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CAQ Snapshot: February 2015

Friday, February 27, 2015

Harvey J. Goldschmid Remembered as “True Leader and a Great Friend to the CAQ”

At the passing in February of CAQ Governing Board Co-Vice Chair Harvey J. Goldschmid, the CAQ Executive Director Cindy Fornelli issued a statement honoring “a true leader and a great friend to the CAQ.”

In a separate LinkedIn Influencer post, Fornelli further commemorated Goldschmid, who over a distinguished career was Commissioner and General Counsel at the U.S. Securities and Exchange Commission, a professor at Columbia Law School, an author of numerous works on corporate and securities law, and an attorney in private practice.

“An essential part of Harvey’s influence was his ability to work with others toward a common good,” Fornelli observed, citing Goldschmid’s extraordinary talent for making difficult concepts clear and accessible to others.

Fornelli also discussed Goldschmid’s role as a founding independent member of the CAQ’s Governing Board. Goldschmid, she writes, was “key to establishing the CAQ as a policy organization not only dedicated to enhancing the quality of the audit, but also, more broadly, to building investor confidence and public trust in the global capital markets.” 

CAQ Salutes Historic Appointment of Engelbert as Deloitte U.S. CEO

CAQ Executive Director Cindy Fornelli hailed the announcement of Cathy Engelbert, CPA as the new CEO of Deloitte, LLP. “[Cathy] is a proven leader who has earned the trust and respect of her colleagues across the profession,” said Fornelli. “We wish her well in her new role and look forward to benefitting from the perspective she will bring to the CAQ’s Governing Board.” 

Fornelli marked the historic nature of the appointment, as Engelbert is the first female chief executive to lead a major U.S. accounting firm. “This is an important step in the profession’s unrelenting drive to continuously improve,” she said.

Introducing, Version 2.0

Since its formation in 2010, the Anti-Fraud Collaboration has continued to add to its collection of free and publicly available resources related to deterring and detecting financial reporting fraud. To improve access to these resources, and to better accommodate future additions, the Collaboration re-launched in February 2015. updated website organizes anti-fraud content from both the Collaboration and others by key thematic priorities—corporate culture, skepticism, and communications—as well as by content type: articles, case studies, reports, and videos. In addition to clearer navigation and a refreshed design, the website makes it easier to learn about the Collaboration, to sign up for Collaboration updates, and to find Collaboration contacts. 

The CAQ is a founding member of the Anti-Fraud Collaboration, along with Financial Executives International, the National Association of Corporate Directors , and The Institute of Internal Auditors.

The CAQ Helps Judge Anti-Fraud Case Study Competition 

Schuyler Simms, CPA and Senior Technical Manager of Professional Practice at the CAQ, helped judge a February 13 fraud and internal control case competition, held by the Department of Accounting at Drexel University’s LeBow College of Business, featuring the Anti-Fraud Collaboration’s “Hollate Manufacturing” case study. Top honors at the competition were taken by students Jin Li, Wanzhou Xu, Justin Maslin, and Brandon Marder.

Inspired by the Harvard Business School case study method, Hollate Manufacturing was released in March 2013 to raise awareness of environments in which financial reporting fraud might flourish. By describing a potential material fraud in a fictional company, the case study serves as a catalyst for an interactive discussion about what audit committees, financial executives, and internal and external auditors could do to mitigate the risk of fraud. A second case study, “Carolina Wilderness Outfitters” was published in February 2014. 

“It was great to see Hollate Manufacturing in action,” says Simms, herself a graduate of Drexel University in accounting and international business. “Both the energy of the students and the engagement of those in attendance demonstrated the value of these case studies as anti-fraud resources.” 

The Anti-Fraud Collaboration is currently developing a third case study that will focus on the proper application of skepticism.

Deadline Ahead for Submitting Research Grant Proposals 

Reminder: applicants have until March 20, 2015 to respond to the CAQ’s call for research grant proposals on key auditing topics. As noted in its December 2014 request for proposals, the CAQ is especially interested in proposals addressing priority areas for the public company auditing profession, including audits of internal control over financial reporting, audit quality indicators, audit committee effectiveness, communication and information technology, financial reporting fraud, professional skepticism, and value of the audit. The CAQ will consider research proposals with a domestic or international dimension on these topics or others that would be helpful to practice. Any appropriate research method can be employed.