August 21, 2018

Auditor Musical Chairs: 99¢ Only Stores Splurges on Ernst & Young, Dumps BDO

With a business name like "99¢ Only Stores," no one would blame you if you assumed the company and would try to pinch some pennies on their auditor. It's a commodity service that is just asking to be squeezed, after all. However, sometimes as a public company, you'd like a big name brand on your auditor's opinion. A Tiffany diamond, if you will. That seems to be desires of team 99¢:

The Audit Committee (the “Audit Committee”) of the Board of Directors of Number Holdings, Inc., the parent company of 99¢ Only Stores (the “Company”), has completed a competitive process to review the appointment of the Company’s independent registered public accounting firm for the fiscal year ending March 30, 2013. The Audit Committee invited several firms to participate in this process.
 
As a result of this process and following careful deliberation, on November 5, 2012, the Audit Committee approved the dismissal of BDO USA LLP (“BDO”) and the engagement of Ernst & Young LLP (“E&Y”) as the Company’s independent registered public accounting firm, in each case effective November 7, 2012.
While this is probably just another notch on the bedpost for E&Y, according to our tipster who provided the link to the 8-K, this is a much more painful event for Bravo Delta Oscar. 
This was BDO Los Angeles' largest client.
It's probably safe to assume that E&Y just hustled a little harder. 
 
8-K [SEC]

Related articles

SHOCKER: Doesn’t Appear that Stanford Auditors were Doing Any Auditing

allen-stanford_1018295c.jpgLast week’s indictment of Allen Stanford has brought up the always popular question when fraud, occurs: “Who are the auditors that were asleep at the wheel of this disaster?”
Well, in this case, the auditors were a local UK two-person shop, CAS Hewlett, which must be Queen’s English for Friehling & Horowitz.
It doesn’t appear that CAS Hewlett has a website, but they’ve been doing the Stanford “audits” for at least 10 years, so obv they’re legit. PwC and KPMG both have offices on Antigua but Stanford preferred to stay with its “trusted firm”. Totally understandable.
And the best part? The founder of the firm, Charlesworth “Shelly” Hewlett died in January, approximately a month before the story broke on the Ponz de Stanford.
This all adds up to who-the-fuck-knows if audits were even occurring and for us to speculate if Shelly needed to get got because Stan knew that the poo and fan were coming together. Just sayin’.

Jeremy Newman Just Wants to Be Clear, We are NOT Declaring Victory Over Banco Espirito…YET

BDO_International.pngAfter throwing an all night rager last week when BDO International Global Coordination skated on the $521M verdict, Jeremy Newman, BDO Boss, wants everybody to chill.

Newman said he had always been confident that BDO International’s arms-length approach would be proved but added: ‘There is still the risk of a further appeal, as well as the appeal by the US firm.’

See? Staying cool. Not out of the woods yet. But when we beat those bastards on appeal, then we are getting down.

Newman stays cool after BDO victory
[Accountancy Age]