On June 5, 2023, without admitting or denying the findings, Israel-based audit firm Barzily & Co. Certified Public Accountants settled with the PCAOB and consented to a disciplinary order. The order alleges that Barzily & Co. failed to establish quality control policies and procedures to provide reasonable assurance of compliance with applicable PCAOB standards, and, as a result of the firm’s inadequate system of quality control, failed to comply with several PCAOB rules and standards in connection with its audits of the year-end 2018 through 2020 financial statements of two issuer clients. The alleged violations of PCAOB rules and standards included: failing to file, or filing late, Form APs for subsequent audits for the two clients, in violation of Rule 3211; accepting a tax engagement for one audit client without sufficiently discussing the engagement, and its potential independence effects, with the client’s audit committee, in violation of Rule 3524; failing to disclose in one audit report the absence of critical audit matters, in violation of AS 3101.16; and failing to maintain audit documentation, in violation of AS 1215 and AS 1301. The Board censured the firm, ordered it to pay a monetary penalty of $50,000, and required the firm to undertake certain remedial measures with respect to its system of quality control. As a part of the remedial undertakings, the Board ordered the firm to provide certain training to its employees and to retain a Board-approved independent consultant to review, and to recommend changes to, the firm’s quality control policies and procedures.

The order is attached.