PCAOB Sanctions Three Firms for Disclosure Violations

On August 11, 2023, the PCAOB issued three settled orders (without the respondents admitting or denying the findings) sanctioning firms for allegedly failing to report required information to the Board:

• The Board alleged that, in 2021, BDO Taiwan submitted its Annual Report on Form 2 to the PCAOB but failed to identify, as required by the form, that it had played a substantial role in the audit of an issuer—a fact the PCAOB allegedly discovered from a Form AP submitted by the different auditor.  According to the order, the firm did not file an amended Form 2 correcting the failure until June 2023, in response to a notice of deficiency sent by the Division of Enforcement and Investigations (“DEI”) after four notices from the Division of Registration and Inspections went unanswered (“DRI”).  The Board censured the firm and imposed a penalty of $35,000.
• The Board alleged that, in 2021, Jendrach Accounting and Professional Services also filed an Annual Report on Form 2 that failed to identify its substantial role in the audit of an issuer, which the Board allegedly discovered from SEC filings.  The firm filed an amended Form 2 only after multiple notices from DRI went unanswered and DEI sent notices of deficiency.  The Board censured the firm and imposed a penalty of $25,000.
• The Board alleged that Brazil-based Moore MSLL Lima Lucchesi Auditores e Contadores Ltda. failed to timely notify the PCAOB of a change to its legal name on Form 3 and instead filed multiple Annual Reports using its new name.  The order alleges that the firm filed an untimely Form 3 only after failing to respond to emails from the DRI and receiving a notice of deficiency from DEI.  The Board censured the firm and imposed a penalty of $25,000.

The three orders can be found here: BDO Taiwan, Jendrach Accounting, and Moore MSLL.