Cornerstone Research Connects: 2021 Accounting and Auditing Enforcement Activity

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Cornerstone Research Connects is the firm’s podcast series in which we interview Cornerstone Research staff and in-house experts about their research and what the data can tell us about litigation trends. The authors discuss this latest report and some of its key findings.

Elaine Harwood, Alison Forman, and Simona Mola, coauthors of the report Accounting and Auditing Enforcement Activity—2021 Review and Analysis, discuss their recent findings, including:

  • The overall level of enforcement activity during 2021.
  • An analysis of enforcement activity at the SEC in the months after Chair Gary Gensler took office in 2021, compared to the enforcement activity in the months after his predecessor took office in 2017.
  • The sharp decline in total and median monetary settlements in SEC enforcement actions.
  • Penalties at the PCAOB imposed on firm respondents and individuals.
  • Expectations at both agencies for 2022.
About Accounting and Auditing Enforcement Actions

In this report, accounting and auditing enforcement actions include (1) SEC Accounting and Auditing Enforcement Releases (AAERs) listed in the SEC Division of Enforcement Annual Reports and available on the SEC’s website at https://www.sec.gov (“SEC actions”), and (2) PCAOB settled and adjudicated disciplinary orders available on the PCAOB’s website at https://pcaobus.org (“PCAOB actions”). SEC actions exclude follow-on administrative proceedings. SEC and PCAOB auditing actions exclude actions unrelated to the performance of an audit or the firm’s system of quality control (e.g., failure to register with the PCAOB or to timely disclose certain reportable events to the PCAOB).


The views expressed herein are solely those of the speakers, who are responsible for the content, and do not necessarily represent the views of Cornerstone Research.

Accounting and Auditing Enforcement Activity—2021 Review and Analysis

Speakers

  • Los Angeles

Elaine M. Harwood

Senior Vice President

  • Chicago

Alison M. Forman

Principal

  • Washington

Simona Mola

Principal