The Public Company Accounting Oversight Board (PCAOB) took disciplinary action against a firm and individuals tied to it for violations of its rules and standards.
Specifically, the actions were taken against Haynie & Company, Haynie partner Tyson Holman and former Haynie partner Anna Hrabova, and Haynie partner Steven Avis and former Haynie partner Richard Fleischman.
The PCAOB found that they each violated PCAOB rules and standards while serving as either engagement partner or engagement quality review partner on Haynie’s audit of the 2019 financial statements of George Risk Industries or Haynie’s audit of the 2019 financial statements of Investview. The PCAOB also found that Haynie violated PCAOB rules and standards on these 2019 audits, as well as PCAOB quality control standards.
“The PCAOB means business when it comes to enforcing our standards to meet our mission of protecting investors,” PCAOB Chair Erica Williams said. “Where audit deficiencies reflect a deeper failure of a firm’s quality control system, the PCAOB will take action to impose accountability at both the firm level and the engagement team level.”
PCAOB found that Holman and Avis — the engagement partners on the George Risk and Investview audits, respectively — failed to exercise due professional care and professional skepticism, failed to obtain sufficient appropriate audit evidence to support Haynie’s opinions, and failed to evaluate whether the financial statements were presented in conformity with the applicable financial reporting framework.
Hrabova and Fleischman, while serving as engagement quality review partners on the 2019 George Risk and Investview audits, respectively, failed to exercise due professional care and professional skepticism.
The PCAOB further determined that Haynie violated PCAOB quality control standards.
“The multitude of audit deficiencies in this case demonstrates that, where a firm’s quality control system is lacking, audit quality suffers,” Robert Rice, director of the PCAOB’s Division of Enforcement and Investigations, said.
Without admitting or denying the findings, the respondents consented to the PCAOB’s orders. Specifically, the respondents were all censured. Further, Holman and Avis were hit with $65,000 civil money penalties each and two-year bars from being associated persons of a registered public accounting firm. Hrabova and Fleischman received $30,000 civil money penalties each and one-year practice limitations. Haynie was given a $400,000 civil money penalty and is required to engage an independent consultant.