PCAOB revokes firm registration, bars partner

The Public Company Accounting Oversight Board today announced it settled a disciplinary order sanctioning Weinstein International CPA and its sole partner, Idan Weinstein, for audit and quality control failures.

The PCAOB found that during three different audits, the firm and Weinstein committed multiple violations, including failing to obtain sufficient audit evidence, exercise due professional care and professional skepticism, and resolve inconsistencies with respect to related party transactions, intangible assets and cash balances. 

Courtesy of the PCAOB

"To protect investors, the PCAOB will not hesitate to take enforcement action against auditors who fail to perform audits in accordance with PCAOB rules and standards," PCAOB chair Erica Williams said in a statement.

The firm also failed to establish, implement and monitor adequate quality control policies and procedures to ensure firm personnel would comply with professional standards. Weinstein, as the firm's owner, directly and substantially contributed to the violations. 

"This case highlights the PCAOB's continued commitment to hold auditors accountable for failures to approach their audits with due professional care and professional skepticism, particularly when the failures involve multiple audits and inconsistent audit evidence," Robert Rice, director of the PCAOB's Division of Enforcement and Investigations, said in a statement.

The sanction is the latest in a long line of increased enforcement efforts by the PCAOB, including sanctioning five firms for reporting violations last month. In September, it settled sanctions against four firms for failing to make required communications with audit committees, as well as one firm for violating reporting requirements. The board previously sanctioned Baker Tilly, Grant Thornton Bharat, Mazars and SW Audit in February, as well as three firms in November 2023 and five firms in July 2023.

Without admitting or denying the findings, the firm and Weinstein consented to the disciplinary order, which:

• Censures them;
• Bars Weinstein from being an associated person of a registered public accounting firm, with a right to petition to re-associate after three years;
• Revokes the firm's registration, with a right to apply to re-register after three years; and, 
• Requires the firm to review and certify its quality control policies prior to submitting any future registration application.
  

The PCAOB would have imposed a joint and civil money penalty of $75,000 but did not do so after considering the firm and Weinstein's financial resources.