AA may face litigation over Penguin audit

Article Abstract:

Pearson is investigating the role of accounting firm Arthur Andersen (AA) in the accounting anomalies that caused US-based publisher Penguin to lose 100 million pounds sterling. It found out that an employee at the publishing company, an AA client, has been giving 5% discounts to customers since 1991 but has been entering the original sales figures in the books. The irregularities were discovered during 'routine integration procedures' conducted after Penguin's acquisition of Putnam Berkley. Pearson says that it has found no evidence indicating that Penguin's top management was aware of the fraud. A claim for recovery against third parties, including Arthur Andersen, may be pursued. The accounting firms is reported to be cooperating fully with the investigation.

PRINTING AND PUBLISHING, Publishing, Publishing Industries, Publishing industry, Accounting and auditing, Malpractice, Auditors, Arthur Andersen & Co. (New York, New York), Penguin Books USA Inc.

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Accountant reprimanded

Article Abstract:

The Institute of Chartered Accountants of Scotland (ICAS) has found accountant Gerald Paxton Woolard guilty of professional misconduct for allowing his firm to participate in an international money laundering operation. Glasgow-based accounting firm MacLeod Paxton Woolard & Co was found to have accepted $17.6 million on behalf of a client that turned out to be insolvent, had no assets and had plenty of liabilities. The firm was paid 120,000 pounds sterling for this work, an amount that the ICAS found to be excessively disproportionate to the service it was hired for. The Society has fined Paxton Woolard 6,000 pounds and has ruled that he will no longer be considered a regulated non-member.

Cases, Discipline, Accountants, Powers and duties, Money laundering, Institute of Chartered Accountants of Scotland, MacLeod Paxton Woolard and Co.

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Canada's regulator lashes out at Big Four

Article Abstract:

The Canadian Public Accountancy Board (CPAB) has publicly criticized the auditors in Canada's largest firms. CPAB found serious deficiencies in audits conducted by the country's Big Four audit firms, as well as an unacceptable failure of more than half of the senior managers and partners in those firms to comply with their own auditor independence rules.

Canada, Legal issues & crime, Company legal issue, Auditing, Accounting fraud

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