Studies

Credibility International Releases Inaugural Study of SEC and PCAOB Financial Reporting Enforcement Matters

July 23, 2020

Washington D.C., July 8, 2020 – Credibility International is pleased to release its inaugural study of U.S. Securities and Exchange Commission (“SEC”) and Public Company Accounting Oversight Board (“PCAOB”) enforcement activity related to public-company issuer accounting, disclosure, audit failure, and auditor independence enforcement matters.

The preparation of the study was led by Credibility International’s President Michael Maloney, who served as Chief Accountant of the SEC’s Division of Enforcement from 2014 through 2018. Mr. Maloney’s unique expertise in SEC and PCAOB enforcement matters is reflected in the study’s data analysis, observations, and insights.

The study is based on SEC Accounting and Auditing Enforcement Releases and PCAOB Disciplinary Orders issued during the period July 1, 2019 through December 31, 2019. Among other things, the study includes analysis of:

  • Case activity levels and matter types
  • Case resolution and respondent types
  • Primary case issues, including specific GAAP Accounting, Disclosure, Audit Failure, and Auditor Independence issues alleged
  • Fraud vs. non-Fraud charging decisions
  • SEC and PCAOB accountant and auditor suspensions/bars, including:
    • Segregation between individuals vs. firms, and internal accountants vs. external auditors
    • Length of SEC suspensions and PCAOB bars
  • PCAOB auditing standards alleged violated in audit failure matters
  • Discussion of notable issues and trends across the cases evaluated
  • A Case Spotlight exploring unique cases in more detail in each key area, including GAAP Accounting, Disclosure, Audit Failure, and Auditor Independence

For highlights of the study findings and to download the study itself, please click here (PDF)