APRIL 11, 2017 RECENT DEVELOPMENTS
Today's Wall Street Journal reported that KPMG fired six (6) employees, including the firm's audit practice leader, national managing partner in charge of audit quality and professional practice, and three (3) other partners, over information leaks regarding audits the Public Company Accounting Oversight Board (PCAOB) planned to inspect at the firm. The information reportedly came from a PCAOB employee (now former employee) to a KPMG employee. According to the article:
The KPMG employee who received the leak formerly worked at the accounting board, according to the audit firm. The company said the person received “improper advance warnings of engagements to be inspected,” and shared it with other KPMG executives. KPMG says it told both the accounting board and the Securities and Exchange Commission, which oversees the board, about the leak as soon as it was discovered.
The PCAOB, which hired a law firm to investigate the incident, is taking steps to ensure the integrity of its inspections process. Lynne Doughtie, KPMG’s chairman and CEO, said the firm is taking additional steps to ensure that such a situation should not happen again.