Auditors

Auditors

Postby winston » Sat Nov 06, 2010 12:47 pm

Does the auditors verify whether announced contract wins are genuine or not?

Example:

I have seen some companies regularly announced contract wins. However, I dont see the corresponding increase in their reported Revenue and reported Net Profit.

Does an auditor has the responsibility to ensure that the public announcements are genuine or not?
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Re: Auditors

Postby kennynah » Sat Nov 06, 2010 7:14 pm

depends on whether in malaysia or singapore 8-)
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Re: Auditors

Postby winston » Sat Nov 06, 2010 7:18 pm

How about chinese companies listed on sgx ?
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Re: Auditors

Postby winston » Fri Jun 24, 2011 6:45 pm

China accounting scandals put Big Four auditors on red alert by Rachel Armstrong

HONG KONG (Reuters) - The string of accounting problems and stock plunges at publicly traded Chinese groups has sparked deep concerns across the world's biggest audit firms, putting the so-called Big Four on alert from worries that their reputation could be brought down along with a growing list of stricken companies.

Auditing Chinese firms preparing to go public on overseas exchanges is a lucrative business and one that plays into the strengths of the top, international auditing partnerships known as the Big Four: KPMG, Ernst & Young, Deloitte Touche Tohmatsu and PricewaterhouseCoopers.

Yet fears are growing that the struggle to find enough high-quality auditors in China and Hong Kong means it may only be a matter of time until one of the top firms finds itself caught in a blow-up rivaling Enron, which brought down their old rival Arthur Andersen.

"Costs have gone up, fees have gone down, as competition for fees is enormous. You can easily see there is a real risk of an audit firm failing," said Paul Winkelmann, the partner in charge of risk and compliance for PWC in Greater China.

The Big Four are also getting nervous about work with existing Chinese clients, turning to lawyers at an earlier stage if they think something might be amiss.

CHINA BOOMING BIZ

The big four have basked in China's emergence as an economic powerhouse. In 2009 their revenue from work on the mainland stood at 9.1 billion yuan ($1.41 billion) according to the Chinese Institute of CPAs (CICPA), around half of China's accounting industry's revenue. Last year's figures were not immediately available.

Last month, Deloitte quit as auditor of Longtop Financial Technologies after working on the company's books for six years, citing "recently identified falsity" in their finances.

Ernst & Young was named in two class action lawsuits over its work on Sino-Forest, the Toronto-listed company accused by short-seller Muddy Waters of accounting fraud.

In Hong Kong, KPMG said in January that it had found possible irregularities in the books of China Forestry, leading to a suspension of its shares.

STAFF SHORTAGES

Two of the biggest challenges facing the big four are staffing and the type of companies they audit.

Together the firms now employ just under 40,000 people in mainland China, Hong Kong and Taiwan. While that's a relatively high number compared to other regions, it's not enough to handle the huge demand created by the rapid economic growth of the world's most populous country, experts say.

"We are in tremendous need of experienced accounting professionals and graduating college students," said a spokeswoman for Ernst & Young, which plans to recruit 1500 new staff this year.


Source: Reuters US Online Report Business News
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Re: Auditors

Postby winston » Sat Jun 25, 2011 6:51 pm

Longtop Financial, a maker of banking and insurance software said on May 23 that Deloitte Touche Tohmatsu CPA Ltd. resigned as its auditor after finding falsehoods in the company’s financial records.


Source: Bloomberg
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Re: Auditors

Postby winston » Mon Jul 11, 2011 9:59 am

S- chips - Confusion remains over China guidelines on choosing auditors

There remains confusion over guidelines issued by Chinese regulators on choosing auditors, with some market watchers still mulling over the possible impact on S-chips though there could well be none.

The timing of the notice from China's Ministry of Finance (MOF) on July 1 likely contributed to the confusion as it came hot on the heels of some accounting scandals among Chinese listings in Singapore and the United States.

One apparent misunderstanding is how the approved list of 12 auditors for Hshares (mainland-incorporated companies listed in Hong Kong) could be applied to other overseas listings. But as mentioned in an earlier BT report, there is no
restriction on other overseas Chinese listings to engage only auditors in the sanctioned list for H-shares.

Source: AM Fraser
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Re: Auditors

Postby winston » Mon Oct 10, 2011 7:40 am

Corporate Audit Fees Up? Beware of Trouble Ahead

(Reuters) - Elevated audit fees can be a red flag of problems to come for a company, say three recent academic studies that together warn about increased chances of fraud, stock price declines or financial restatements.

http://www.newsmeat.com/news/meat.php?a ... &buid=3281
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Re: Auditors

Postby winston » Thu Oct 20, 2011 5:49 am

Audit giants quizzed over work on US-listed China firms

CHINA'S financial regulators have asked the world's biggest audit firms to conduct an urgent review of their work on US-listed Chinese companies and provide them with details on information they may have provided to overseas regulators.

The move is set to ratchet up tensions between the financial regulators of America and China following a string of accounting scandals at US-listed Chinese companies.

http://www.businesstimes.com.sg/sub/new ... 39,00.html?
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Re: Auditors

Postby winston » Sun Nov 27, 2011 11:19 am

Has anyone succeeded in suing the auditors ?

What's the point in auditors' reports? by Jonathan Weil

Six months ago, the accounting firm PricewaterhouseCoopers LLP said MF Global Holdings and its units "maintained, in all material respects, effective internal control over financial reporting as of March 31, 2011". A lot of people who relied on that opinion lost a ton of money.

MF Global filed for bankruptcy on Oct 31. This week, the trustee for the liquidation of its United States brokerage unit said as much as US$1.2 billion (S$1.58 billion) of customer money is missing, maybe more. Those deposits should have been kept segregated from the company's funds. By all indications, they were not.

What is the point of having auditors do reports like this? And are they worth the cost? It is getting harder to answer those questions in a way the accounting profession would favour.

http://www.todayonline.com/Commentary/E ... rs-reports
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Re: Auditors

Postby winston » Fri Dec 23, 2011 7:49 am

Watchdog faults Ernst & Young on audits

(Reuters) - A 2010 inspection by the U.S. audit industry watchdog faulted accounting giant Ernst & Young for a range of audit issues, including not getting enough supporting evidence and problems with testing the fair value of financial instruments.

http://www.reuters.com/article/2011/12/ ... Name=usdai
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