AMERICA'S ACCOUNTANCY WATCHDOG has uncovered a series of failures in audit work conducted by the US arms of PwC and KPMG.
In its latest set of inspections, the Public Company Accounting Oversight Board (PCAOB) found a worrying number of deficiencies in the audit work carried out by the two firms.
According to its report both firms were guilty of failing to obtain "sufficient and appropriate" evidence to support their audit opinions on the financial statements and the effectiveness of the issuer's internal control over financial reporting.
For instance, in one audit KPMG failed to evaluate whether certain control deficiencies - some of which related to identified misstatements that exceeded KPMG's established level of materiality - represented material weaknesses individually.
In the case of PwC, one of the deficiencies relates to auditing aspects of an issuer's financial statements that it restated after the primary inspection procedures.
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