Compliance into the Weeds is the only weekly podcast which takes a deep dive into a compliance related topic, literally going into the weeds to more fully explore a subject. In this episode, Matt Kelly (the coolest guy in compliance) and I take things in a different direction as we welcome Francine McKenna, reporter at MarketWatch. And blogger extraordinaire at Re: The Auditors. After one full week of writing, thinking and talking about the SEC enforcement action against KPMG, we provide our initial reflections.
McKenna discusses:
- Is the total fine only Starbucks money for KPMG?
- Why no one had an inkling of this cheating scandal in addition to the PCAOB scandal.
- Why will the SEC will go out of its way not to put KPMG out of business?
- What are the federal government audit assignments KPMG currently holds?
- How should recalcitrant KPMG employees be disciplined?
- Can the KPMG culture be turned around?
Kelly discusses:
- Who will be the monitor and what will be their scope? What will they do?
- How do you hold accounting firms accountable?
- Channeling his inner Dean Wormer, Kelly asks if KPMG is now on a double Cease and Desist Order?
- Can KPMG keep public confidence going forward?
- Did Jay Clayton’s summer 2018 comments include any knowledge of the cheating scandal?
Fox discusses:
- Was it negligent or intentional conduct involved?
- How heavy is the shadow of Arthur Anderson in this matter?
- Why the government will use all means possible not to put KPMG out of business?
- KPMG in currently involved in multiple scandals, in at least 3 separate continents. Where and when will it end?
- Is it time to break up the Big 4?
- Is this fine really even a meaningful sanction?
For additional reading, check out the following resources:
You should start with McKenna’s great piece on the scandal in MarketWatch, “The KPMG cheating scandal was much more widespread than originally thought”
Matt’s blog post-Questions on the KPMG Ethics Fiasco
Tom’s blog post-Day of Reckoning for KPMG-Failures in Ethics
