December 18, 2018

KPMG Adds Another Independent Warm Body to Its Board of Directors

KPMG has given retired Air Force General Janet Wolfenbarger a friend on its board of directors.

KPMG LLP, the U.S. audit, tax and advisory firm, is pleased to announce the appointment of Linda L. Addison as an independent director to its U.S. Board of Directors. Addison is the second distinguished independent director the Firm has announced, joining General (ret.) Janet C. Wolfenbarger, who was appointed in October.

Linda Addison

The recent influx of outside directors “is an important change to our governance model, and demonstrates our ongoing commitment to quality, innovative thinking and a values-driven culture,” said KPMG Chairman and CEO Lynne Doughtie in a Nov. 12 press release.

But let’s be real. You wouldn’t be seeing Wolfenbarger, Addison, or any other “outside perspective” joining the firm’s board if a handful of KPMG partners weren’t indicted earlier this year for stealing inspection information from the Public Company Accounting Oversight Board.

Doughtie said as much in an article she wrote for Accounting Today last May:

In 2017, certain events, and the actions of a few former colleagues, caused us to take a deeper dive into examining our culture and values, and to assess with fresh eyes how we could improve and best position our more than 100 year-old firm for future success. What has emerged from that ongoing exercise is not surprising. We have been reminded of the cardinal rule in our business, namely that trust is paramount and, as such, must inform all that we do.

Three of those former colleagues have pled guilty to wire fraud and conspiracy charges, while two other ex-KPMG partners are scheduled to go to trial in February 2019.

Addison, the newest independent KPMG director, is the immediate past U.S. managing partner of global law firm Norton Rose Fulbright. Here are her credentials:

For more than three decades, Linda has worked with CEOs, corporate boards, and corporate executives across multiple industry sectors, both regulated and unregulated, including some of the world’s leading multi-national companies. Linda is a global business leader with expertise in compensation, M&A, risk management, regulatory/compliance, technology, governance, and crisis management. She has extensive knowledge of a complex partnership structure and culture like KPMG’s, and brings vast experience defining and implementing a firm’s global strategy and overseeing business operations worldwide.

KPMG is one of only two Big 4 firms that have independent directors on its U.S. board. The other is PwC, which also has two, according to Compliance Week.

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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’.

Deloitte Throws Up its Hands Regarding Missing Gold

deloitte.jpgThe Royal Canadian Mint (RCM) had a discrepancy between their book inventory of precious metals and the actual count, so natch, they called in a Big 4 accounting firm to do an audit and get to the bottom of this.
Deloitte got the honor of investigating and…wait for it…determined that there is gold missing. 17,500 ounces to be precise, worth about 15.3 million Canadian Dollars (approximately $13.2 USD). Oh, and there’s probably some silver missing too.
In classic auditor fashion, Big D issued a recommendation to the RCM to review its security.

Audit fails to find missing gold
[BBC]