Dr. Avishai Teicher
US Securities and Exchange Commission (SEC) fined EY $ 11.8 million for experts of one of the world’s leading auditing firms supposedly "did not notice" publication of false financial statements from oilfield services company Weatherford International.
According to SEC’s estimation, in a period from 2007 to 2012 Weatherford International overstated figures on its earnings by a total of $ 900 million. In its report, the regulator says that if employees of Ernst & Young would have really followed high standards of audit, they could be able to notice falsification of the oilfield service company’s statements back in 2007.
At the end of September 2016, US Securities and Exchange Commission fined Weatherford International $ 140 million for the abovementioned accounting fraud.
This year, SEC has already brought a charge against the consulting company. Ernst & Young was fined $ 9.3 million for the fact that two of its employees have entered into a romantic relationship with clients, reported Financial Times.
According to the newspaper, SEC fined Ernst & Young for two episodes of violations. First, a senior auditor of EY team, conducting financial audit of a public company in New York, have developed "too close" friendship with financial director of the audited company. He also spent $ 100 thousand for corporate entertainment.
In the second case, another auditor of Ernst & Young’s team entered into a romantic relationship with chief accountant of the audited company. Securities and Exchange Commission believes that management of EY knew about the violations, but did nothing to correct them.
EY’s representative told the FT that these employees are no longer working for the company.
The US is a key market for the consulting company. EY’s revenue there numbered $ 11.2 billion, an increase over the previous fiscal year to 12.5%. This is a record figure for the last decade. Ernst & Young has steadily strengthened its position in the country, not only in all areas of services, but also across all sectors and throughout the US. The company also considers the UK another leader in the growth of revenues in the developed markets. This is primarily obliged to attracting new major audit clients, as well as to increasing volumes of Transaction Advisory Services, Tax and Legal Services.
source: ey.com, reuters.com
According to SEC’s estimation, in a period from 2007 to 2012 Weatherford International overstated figures on its earnings by a total of $ 900 million. In its report, the regulator says that if employees of Ernst & Young would have really followed high standards of audit, they could be able to notice falsification of the oilfield service company’s statements back in 2007.
At the end of September 2016, US Securities and Exchange Commission fined Weatherford International $ 140 million for the abovementioned accounting fraud.
This year, SEC has already brought a charge against the consulting company. Ernst & Young was fined $ 9.3 million for the fact that two of its employees have entered into a romantic relationship with clients, reported Financial Times.
According to the newspaper, SEC fined Ernst & Young for two episodes of violations. First, a senior auditor of EY team, conducting financial audit of a public company in New York, have developed "too close" friendship with financial director of the audited company. He also spent $ 100 thousand for corporate entertainment.
In the second case, another auditor of Ernst & Young’s team entered into a romantic relationship with chief accountant of the audited company. Securities and Exchange Commission believes that management of EY knew about the violations, but did nothing to correct them.
EY’s representative told the FT that these employees are no longer working for the company.
The US is a key market for the consulting company. EY’s revenue there numbered $ 11.2 billion, an increase over the previous fiscal year to 12.5%. This is a record figure for the last decade. Ernst & Young has steadily strengthened its position in the country, not only in all areas of services, but also across all sectors and throughout the US. The company also considers the UK another leader in the growth of revenues in the developed markets. This is primarily obliged to attracting new major audit clients, as well as to increasing volumes of Transaction Advisory Services, Tax and Legal Services.
source: ey.com, reuters.com
