Two more corporate shareholders filed a legal claim against Toshiba, linked to the the 2015 accounting scandal, seeking $5.08 million in compensation for damages. This brings the total damages sought to $1.2 billion!
A few month’s ago UK’s Financial Reporting Council (FRC) levied the then largest ever penalty on PWC, for 5 Million Pounds, related to misconduct over its audit of Connaught Plc, a FTSE 250 company that went into administration in 2010.
Now PWC is fined 5.1 Million pounds related to misconduct over its audit of RSM Tenon Group Plc., a professional services firm that went into administration in 2013.
FRC is also investigating PWC’s audit of the BT Group Plc following an accounting scandal in the carrier’s Italian unit.
Definitely a record breaking year for PWC, definitely not the kind the firm is looking for.
Alere, a Waltham based diagnostic firm, agreed to pay $13 million to the Securities and Exchange Commission (SEC), to settle charges that it committed accounting fraud. The charges state that the company, through its subsidiary in South Korea inflated their revenue by recognizing revenue for products that were still being stored in the company’s warehouse or otherwise not delivered to the customer.
Another charge on the company is that the company’s subsidiaries in India and Colombo obtained or retained business by making improper payments/bribing government officials in those countries. The company failed to maintain adequate internal controls to prevent such payments and the company also inaccurately recorded the payments in its books.
The company neither admitted nor denied the findings but has agreed to pay $13 million, out of which $9.2 million is the penalty amount.
The question though is, isn’t the fact that they are paying the SEC accepting guilt?
One of the big 4 accountancy firms, Deloitte is one of the victims of the hacker attacks of the recent times. The attack that dates back to November 2016, was a breach of Deloitte’s email systems that gave the hackers access to all the areas of the firm.
What is interesting is that the attack went undetected till March 2016. After the detection though, the firm implemented security protocols, began intensive review of their cybersecurity, and contacted the affected parties and notified the government authorities and regulators.
The hack attacks of the last few years have made us aware of the vulnerability of companies and countries. It will be interesting to see what technology can do to protect against these attacks, it will be technical minds of hackers vs the technical minds of another set of hackers!
Luca Pacioli, known as the “Father of Accounting and Bookkeeping” was an Italian mathematician, who published the first book on double entry accounting in the year 1494.