The U.S. Public Company Accounting Oversight Board, which regulates audit firms, says it sees many problems in the work that audit firms do on companies' internal controls, and adds that the number of problems is growing, Reuters reports.
Auditors' checks on companies' internal controls fell short in 22% of the audits the PCAOB checked in 2011, up from 15% in 2010, the regulator says. Its inspections cover the Big Four audit firms and four smaller auditors: BDO Seidman, Grant Thornton, Crowe Horwath and McGladrey.
PCAOB Jay Hanson says the report does not mean that companies' internal controls were faulty, but that auditors were doing a bad job of checking them.
See the full Reuters story here and the PCAOB report here. See more coverage from the Journal of Accountancy and Accounting Today.
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