Toshiba's Unapproved Finances

Toshiba files delayed financial results without auditor approval!

KPMG Audit of HBOS To Be Probed

Accounting experts seek independent probe into KPMG’s audit of HBOS - https://t.co/iLxuKeS2as https://t.co/nDzZX0CRiE via @FT

— Harriet Agnew (@HarrietAgnew) January 26, 2016

The Stench of Corruption at The Heart of The EU

According to the annual report of the European Court of Auditors, as per the Telegraph, £5.5BN of the EU budget last year was misspent because of controls on spending that were deemed to be only “partially effective”.

The audit report highlights that £109BN out of a total of £117BN spent by the EU in 2013 was "affected by material error”.

This means that the EU's accounts have been qualified 19 years running.

Any business that produced such a dismal set of audit results would be torn to shreds by its shareholders, and subjected to a thorough fraud investigation. Unfortunately the EU is, by its own reckoning, above the law and hence will not change its ways unless forced to.

Given the stench of corruption that emanates from Brussels, it is surprising that its MEPs and Commissioners aren't wearing gas masks!

Ernst & Young Fined Over £1M Re Farepak Audit

Accounting Web reports that the Financial Reporting Council (FRC) has ordered Ernst & Young to pay more than £1M in fines and costs wrt its audit of failed Christmas savings company Farepak.

EY was fined £750,000 and told it had to pay costs of £425,000, while auditor Alan Flitcroft, who worked for EY and was responsible for signing off the audit, was fined £50,000.

Both the firm and Flitcroft were also formally reprimanded by the FRC after admitting their audit of Farepak and parent company European Home Retail (EHR) fell below the expected standard.

The FRC ruled EY and Flitcroft failed to perform adequate procedures to assess all material subsequent events between July 2005 and February 2006.

EY has since said it regrets that aspects of its 2005 audit fell beneath standards, but stressed the regulator did not suggest its conduct triggered Farepak's collapse, or losses to savers.

Farepak collapsed into administration seven years ago, leaving 114,000 people with total losses of £37M.

Spanish Bank Auditors Go On Summer Holidays

The Wall Street Journal reports that the deadline for auditors from Deloitte, KPMG, PwC and Ernst & Young to present full reports on the capital needs of Spain's financial sector has been delayed from July 31 to September.

For why?

Officially the reason being presented is the need for more time to complete the evaluation, and the fact that most of Spain (especially the government) is on holiday during the summer.

Amazingly enough the auditors, and those organisations that have commissioned the auditors to do the work (ie Spain's government, the International Monetary Fund and the European Central Bank), have agreed to a delay in order to allow people to go on holiday.

There are two possible conclusions to be drawn from this absurd excuse for a delay:

1 There is in fact no urgent need for any reform or further funding of the financial sector or, more likely,

2 There is something that has yet to emerge that people want hidden for the time being.


Draw your own conclusions.

Doubtless the "crisis" will not get any worse during the summer recess!