Deloitte Report: 475 Reprimands for Internal Noncompliance in 2009

How’s your Thursday morning going Sons and Daughters of Deloitte? Busy? Swamped, you say? Thought so. Well, whatever it is, it can wait.

YES. IT. CAN.

Barry Salzberg needs your full and undivided attention to an important matter today: compliance with internal policies, specifically independence and ethics. During the throes of busy season, you adherence to these important values must not waiver.

Are you trading in client stock in your Scottrade account? Ghost-ticking workpapers? Ramming meaningless numbers into that tax return? Stop it right now. Bar knows that sometimes you can’t just help yourselves, so he dropped a little reminder into your inbox this morning (we were told) with the subject “A must-read for everyone”.

Today, we have an important challenge that we simply cannot ignore. Our level of compliance with our internal policies – specifically our independence and time reporting policies – is not where we need it to be.

Please take a few minutes to read Beyond the Numbers: Our Independence, Ethics & Compliance Imperative from Mike Zychinski, our Chief Ethics and Compliance Officer. The report, which I consider to be a must-read for everyone, addresses concerns from our regulators, what we are doing as an organization to address them, and what you can do to meet your individual compliance requirements.

When it comes to issues of compliance, we must meet the expectations of our clients and regulators. What’s more, we must fulfill our own high expectations of ourselves. Thank you for taking a few minutes to read the report and for your focus on meeting your individual compliance requirements.

Regards,

Barry Salzberg
CEO
Deloitte LLP

Bolding is ours. After this email, a 2,100 (give or take) word report follows from Chieftain of Ethics Mike Zychinski. Despite the high standard that Deloitte holds you to — higher than the SEC, PCAOB, and the AICPA, we might add — this happend, “Based on our own reviews and that of the PCAOB, we believe compliance with our independence policies is not what it should be, and the PCAOB has, in fact, questioned our commitment to adhere to our own policies. This is clearly not acceptable.”

Our contributor Francine McKenna reminded us that Deloitte didn’t think too much of the PCAOB’s report from last year, “They [are] the same firm that famously responded to the PCAOB’s latest inspection report, ‘How dare you second guess us?‘”

Based on the following list of reprimands, perhaps the PCAOB has a leg to stand on?

Four hundred seventy-five total reprimands were issued for noncompliance issues, including:

31 reprimands for independence-related violations of SEC or AICPA rules
174 reprimands for noncompliance with Deloitte independence policy
218 reprimands for failure to meet mandatory training requirements
45 reprimands for CPE noncompliance
7 reprimands for noncompliance with Deloitte CPA Licensing policy

Is 475 a lot or a little? An improvement from last year or is it worse? We’re not really sure. We haven’t received any comment from Deloitte and their Transparency Report doesn’t have more details. But since Barry Salzberg never seems to be satisified with anything, we’re guessing you can do better.

How's your Thursday morning going Sons and Daughters of Deloitte? Busy? Swamped, you say? Thought so. Well, whatever it is, it can wait. YES. IT. CAN. Barry Salzberg needs your full and undivided attention to an important matter today: compliance with internal policies, specifically independence and ethics. During the throes of busy season, you adherence to these important values must not waiver. Are you trading in client stock in your Scottrade account? Ghost-ticking workpapers? Ramming meaningless numbers into that tax return? Stop it right now. Bar knows that sometimes you can't just help yourselves, so he dropped a little reminder into your inbox this morning (we were told) with the subject "A must-read for everyone".

Today, we have an important challenge that we simply cannot ignore. Our level of compliance with our internal policies – specifically our independence and time reporting policies – is not where we need it to be. Please take a few minutes to read Beyond the Numbers: Our Independence, Ethics & Compliance Imperative from Mike Zychinski, our Chief Ethics and Compliance Officer. The report, which I consider to be a must-read for everyone, addresses concerns from our regulators, what we are doing as an organization to address them, and what you can do to meet your individual compliance requirements. When it comes to issues of compliance, we must meet the expectations of our clients and regulators. What’s more, we must fulfill our own high expectations of ourselves. Thank you for taking a few minutes to read the report and for your focus on meeting your individual compliance requirements. Regards, Barry Salzberg CEO Deloitte LLP

Bolding is ours. After this email, a 2,100 (give or take) word report follows from Chieftain of Ethics Mike Zychinski. Despite the high standard that Deloitte holds you to — higher than the SEC, PCAOB, and the AICPA, we might add — this happend, "Based on our own reviews and that of the PCAOB, we believe compliance with our independence policies is not what it should be, and the PCAOB has, in fact, questioned our commitment to adhere to our own policies. This is clearly not acceptable." Our contributor Francine McKenna reminded us that Deloitte didn't think too much of the PCAOB's report from last year, "They [are] the same firm that famously responded to the PCAOB's latest inspection report, 'How dare you second guess us?'" Based on the following list of reprimands, perhaps the PCAOB has a leg to stand on?

Four hundred seventy-five total reprimands were issued for noncompliance issues, including: 31 reprimands for independence-related violations of SEC or AICPA rules 174 reprimands for noncompliance with Deloitte independence policy 218 reprimands for failure to meet mandatory training requirements 45 reprimands for CPE noncompliance 7 reprimands for noncompliance with Deloitte CPA Licensing policy

Is 475 a lot or a little? An improvement from last year or is it worse? We're not really sure. We haven't received any comment from Deloitte and their Transparency Report doesn't have more details. But since Barry Salzberg never seems to be satisified with anything, we're guessing you can do better.

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