backOn December 3, 2024, the PCAOB announced settled orders sanctioning New York accounting firm Raines & Fischer (“Firm”) and three of its partners (William Fischer, Brian Uhlman, and Steven Sarrel) for violating PCAOB rules and standards.
The PCAOB determined that the Firm violated audit documentation standards and failed to cooperate with the PCAOB’s 2020 and 2022 inspections because Firm personnel improperly created and modified workpapers after the relevant documentation completion dates and in advance of the inspections. Upon learning of the inspections, Firm personnel backdated signoffs and changed the clocks on their computers to make it appear that the newly created workpapers were timely, among other things. The PCAOB also determined that the Firm’s quality control system was deficient and that the Firm violated PCAOB Rule 2201 by failing to file its Form 2 on time for four consecutive years.
With respect to Sarrel and Uhlman, the PCAOB found that they (and personnel acting under their direction) improperly altered workpapers in advance of the inspections of engagements for which they were the engagement partner. The PCAOB found that both failed to inform inspectors of these improper alterations despite meeting with PCAOB staff during the inspections. With respect to Fischer, who oversaw the Firm’s Audit Department and quality control, the PCAOB found that he directly and substantially contributed to the Firm’s violations because he was aware of the improper alterations prior to the inspections but failed to act. Additional violations included Uhlman’s failure to test key internal controls, Fischer’s failure to perform adequate engagement quality reviews, and their contributions to the Firm’s noncooperation for the inspections.
Respondents consented to disciplinary orders with the PCAOB that (1) censured each Respondent; (2) permanently revoked the Firm’s registration; (3) barred the individuals from associating with a registered firm with a right to petition the Board to terminate the bar after five years for Uhlman and three years for Fischer and Sarrel; and (4) imposed civil penalties of $200,000 on the Firm, $125,000 on Uhlman, $75,000 on Fischer, and $65,000 on Sarrel.
The settled order related to the Firm is available here; the Uhlman settled order is available here; the Fischer settled order is available here; and the Sarrel settled order is available here.