(The news featured
below is a selection from the news covered in Federal Securities Law Reporter,
which is distributed to subscribers of Federal
Securities Law Reporter.)
Audit Firm Charged with Independence Violations
The SEC charged a national accounting firm with violations
of auditor independence standards. As alleged, the firm, through one of its
national office partners, compromised its professional independence by assisting
a client in its development and marketing of an accounting-driven financial
product. The firm then allegedly advised an audit client on the accounting
treatment for a version of that product without performing a meaningful analysis
of the accounting. The financial product purported to enable a company to
transfer volatile financial assets to a special purpose entity and remove those
assets from the company's financial statements. The SEC censured the firm and
ordered disgorgement.
Release No. 34-55523 will be published in a forthcoming
Report.
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