The PCAOB has posted the last of its inspection reports to be issued on each of the six largest auditing firms, which cover inspections conducted during 2004 for selected 2003 audits performed by these firms. The latest inspection report is for Grant Thorton.
The report notes numerous auditing deficiencies, as have the five earlier reports. A number of the deficiencies relate to auditing of financial instruments, such as derivatives. In fact, there recently have been over 40 restatements related to errors in accounting for derivatives and hedges.
To learn more about this area, check out the reports and studies on the risks posed by hedging in our new “Risk Management” Practice Area.
Drafting the New Option Expensing Disclosures
For NASPP members, there is a webcast program tomorrow – “Drafting the New Option Expensing Disclosures” – during which SEC Corp Fin Chief Accountant Carol Stacey, Ron Mueller and Keith Higgins will discuss the 10-Q and 10-K (as well as earnings release) disclosures that are now required due to mandatory option expensing. If you are not a NASPP member yet, take advantage of a no-risk trial.
Who is that Masked SEC Staffer?
From Jim McRitchie’s CorpGov.net: “Who says all government employees knock off early because they don’t have entrepreneurial incentives? Shareholder activist John Chevedden writes: Perhaps this is like an urban legend – On the Monday Holiday at 5:00 p.m. I picked up a telephone message from the SEC in Washington, DC and figured there was no reason to call back due to the 3-hour time difference. Then about 10:00 p.m. I decided I would just leave an answering machine message. And the person answered the telephone at 1:00 a.m. in DC!”