Compliance Week article: Koss Fraud Spotlights Small Filers’ Internal Control Issues
An article in today’s Compliance Week, Koss Fraud Spotlights Small Filers’ Internal Control Issues (subscription required), quotes me on internal controls and the auditors as it relates to the huge fraud committed by VP of Finance Sue Sachdeva at Koss Corp (NASDAQ:KOSS).
I’m no fan of Sarbanes-Oxley because I believe it was ridiculously expensive, and hasn’t [...]
Sachdeva and Koss Corp.: The indictment, the clothes, and the auditors
The case of the alleged theft of at least $31 million by Sue Sachdeva from Koss Corp. (NASDAQ:KOSS) carries on. Last week, Sachdeva was charged with 6 counts of wire fraud. Experts are saying this indictment came much faster than usual, as the Feds usually spend much more time thoroughly investigating cases. They’re speculating that [...]
The move to IFRS: All about greed
Professor David Albrecht wrote a great piece today about the push to move from U.S. GAAP (Generally Accepted Accounting Principles) to IFRS (International Financial Reporting Standards). His conclusion? The push to switch is motivated purely by greed.
Accounting standards exist so that financial statements have some uniformity. Users of financial statements outside of the companies producing [...]
Koss Corp.: Commit the fraud and cover it up
I’ve been talking here, at DailyFinance.com, and to the media about the massive fraud at Koss Corp. and how I think it may have been committed and covered up. The time has come to get more specific about how I think it happened, and why I think the auditors did not find it.
Disclaimer: I have [...]
Koss Corp. Fraud: Defending Grant Thornton? No.
I have been criticized for “defending” Grant Thornton, the auditors of Koss Corp, which has suffered a fraud loss of at least $31 million at the hands of the company’s Vice President of Finance, Sue Sachdeva. In fact, my comments relating to this case are not a defense of Grant Thornton, in the least. They [...]
Koss Fraud: Losses higher, Grant Thornton fired, Baker Tilly Virchow Krause hired
I’ve had plenty to say about the massive fraud Koss Corp has suffered at the hands of their Vice President of Finance, Sue Sachdeva.
In this news story from Milwaukee’s ABC affiliate, WISN 12, I talk about how a company with annual revenue in the $40 million range can fall victim to a fraud loss of [...]
More on fraud at Koss Corp.
Today’s Milwaukee Journal Sentinel provides additional insights into the alleged fraud committed by Koss Corp. VP of Finance Sue Sachdeva. Initially the fraud was estimated at $4.5 million, but that was quickly revised upward to more than $20 million. It is alleged that Sachdeva spent millions in corporate funds on clothing, jewelry, and other items.
My [...]
PCAOB reports on BDO Seidman and Grant Thornton
Auditing firms are in a world of trouble. Their audit procedures haven’t really kept up with the changing business environment, and the expectations of the users of financial statements are practically impossible for auditors to fulfill. Regardless of the many disclaimers auditors provide about their work (that they don’t provide absolute assurance on the numbers, [...]
Brilliant revelation by PCAOB: CFOs are in charge of the numbers
It’s no secret that I feel that audits are almost completely ineffective when it comes to verifying the validity of financial statements. Sure, an audit checks the math and some of the obvious applications of the accounting rules. But audits don’t guard against fraud and usually don’t find fraud.
Those who want audits to do that [...]
Wondering why frauds at public companies aren’t being pursued by the Feds?
Consumers are often left wondering why the Securities and Exchange Commission doesn’t heavily pursue allegations of fraud against public companies like Overstock.com (NASDAQ:OSTK), Usana Health Sciences (NASDAQ:USNA), Herbalife (NYSE:HLF), and the like. I’ve always said the answer is simple: There are not enough resources devoted to investigating and prosecuting fraud in public companies. Executives are [...]
