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"We're going to account for it as best we can,"
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Auditor Disputes Report About $6.6 Billion in Iraq Money Being Stolen
The U.S. watchdog on the Iraq reconstruction disputed a report this week that quoted him as suggesting $6.6 billion in Iraqi oil money may have been stolen, which would be the biggest theft of funds in national history. (AP)
The U.S. watchdog on the Iraq reconstruction disputed a report this week that quoted him as suggesting $6.6 billion in Iraqi oil money may have been stolen, which would be the biggest theft of funds in national history. (AP)
The U.S. watchdog on Iraq reconstruction is disputing a report quoting him suggesting that $6.6 billion in Iraqi oil money entrusted to U.S. hands may have been stolen.
The charge, if true, would make the theft of funds the largest in U.S. history, and has already angered Iraqis reportedly debating whether to sue over the missing funds.
The Pentagon refuses to endorse the charge that the disappearing dollars were stolen -- either by greedy U.S. contractors or others involved in its movement from U.S. holdings to Iraq. And now, Special Inspector General for Iraq Reconstruction Stuart Bowen said he never said that $6.6 billion in missing money was swiped.
"What we concluded in our previous audits is that it's been virtually impossible to account for what happened to that money," Bowen told Fox News in a telephone interview Monday, adding that criminal cases have led to the convictions of people who have stolen money from a special fund set up by the U.N. Security Council.
But Bowen said he did not mean to imply anything more when he answered a Los Angeles Times reporter's question about whether it would be serious if billions of dollars was stolen from the Development Fund for Iraq.
"I said, yes, it would be a very significant serious crime," he said. "So yes, the reporter was correct that some of it, and perhaps a lot of it, has been stolen. But we don't have a factual basis to reach that conclusion. What we said over and over again is that the lack of controls created vulnerabilities to fraud, waste and abuse."
Bowen did not say where the Los Angeles Times derived the $6.6 billion figure in question, a figure that he didn't use.
After the U.S.-led invasion of Iraq in 2003, the Bush administration airlifted to Baghdad a total of $12 billion that was carried by tractor-trailer trucks from the Federal Reserve currency repository in New Jersey to Andrews Air Force Base in Maryland for reconstruction of the country.
Bowen said most of the money was deposited in Iraq's central bank for distribution to Iraqi ministries and contractors, but he doesn't know how much.
"Iraq could have it all," he said. "They probably do have most of it."
The Pentagon has been unable to properly account for the $2.8 billion that it controlled under the Commander's Emergency Response Program, which allowed military commanders to spend money for reconstruction projects. Bowen said the Pentagon's comptroller asked him last year to help audit the flow of money.
"More important, we're trying to work with the Iraq government to find out what happened to the rest of the money," Bowen said.
Bowen emphasized that the missing money is not U.S. taxpayer funds. The revenues in the DFI come from among other sources -- Iraq's oil and gas exports, as well as frozen Iraqi assets and surplus funds from the now-defunct, Saddam Hussein-era oil-for-food program.
But previous audits have shown the Defense Department didn't do a good job of tracking the money and Iraqi officials told The Los Angeles Times that under a 2004 legal agreement, Washington is responsible for the missing funds.
Iraq's chief auditor and president of the Iraqi Board of Supreme Audit has warned Washington that Baghdad will sue if necessary to recoup the money.
"Clearly, Iraq has an interest in looking after its assets and protecting them," the newspaper quoted Iraqi Ambassador to the United States Samir Sumaidaie saying.
Bowen said the U.S. needs Iraq's assistance to obtain the bank data regarding the disbursal of the funds so that his office can close the books on jurisdiction over DFI by the end of the summer since it's been years since the U.S. has had control over it.
"We're going to account for it as best we can," he said.
Read more: http://www.foxnews.com/politics/2011/06/14/auditor-disputes-report-about-66-billion-in-iraq-money-being-stolen/#ixzz1PIbS1fln
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Read more: http://www.foxnews.com/politics/2011/06/14/auditor-disputes-report-about-66-billion-in-iraq-money-being-stolen/#ixzz1PIb9iCcZ
original post by bob41
Looking forward to the trial later this year. Patrick Byrne is a true American hero who is going to fell the giants and expose them for the crooks they are! Go O!!!
Gold to Reach $5,000 Due to Supply Shortage
http://www.cnbc.com/id/43396080
An exhaustive report by Standard Chartered predicts that gold [GCCV1 1519.30 -5.10 (-0.33%) ] will more than triple to $5,000 an ounce because of a lack of supply, not just because of a surge in demand that most bullion bugs cite in their bullish calls.
AP
“There are very few large gold mines set to commence operation in the next five years,” said Standard’s analyst Yan Chen in a report Monday. “The limited new supply comes at a time when central banks have turned from being net sellers to significant net buyers of gold. The result, in our view, will be a gold market in deficit, even assuming flat growth in demand. With the supply-demand balance so out of kilter, we see the gold price potentially going to US$5,000/oz.”
The London-based firm is among the first to focus on the supply-side of the gold equation amid the many bullish forecasts out there on the metal. After analyzing 345 gold mines and 30 copper/base metal gold mines around the globe, the team estimates annual gold production will be just 3.6 percent over the next five years.
100 OZ GOLD AUG1
(GCCV1)
1519.30 -5.10 (-0.33%%)
CEC:Commodities Exchange Centre
“They make a pretty compelling argument, especially when it comes to mine supply,” said Brian Kelly, head of Brian Kelly Capital and a ‘Fast Money’ trader. “Most analysis focuses on demand from China and India, which of course can disappear as quickly as it materialized.”
But that’s unlikely to happen over the next five years as central banks look to further diversify their holdings of U.S. dollars and as emerging countries buy more gold in the aftermath of the global paper currency crisis.
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“Currently, only 1.8 percent of China’s foreign exchange reserves is in gold,” wrote Chen and the Standard team in the 68-page report. “If the country were to bring this proportion in line with the global average of 11 percent, it would have to buy 6,000 more tonnes of gold, equivalent to more than 2 years of gold production.”
Beyond the money
The bold call is among the most bullish out there. In a Bank of America/Merrill Lynch survey of global money managers released Tuesday, just about a third of money managers felt gold was overvalued. However, that is the highest reading in that survey in more than a year.
Standard Chartered recommends that clients buy shares of smaller gold miners to get the most upside from its prediction but also said clients could buy physical gold and gold exchange-traded funds.
original post by Mattyhoho
SevenTenEleven: Just incredible the number of folks who lack integrity and will do almost anything for a buck these days. Pump and dumps, short and distort, paid liars, bribes, insider trading, selling that which does not exist, selling instruments to investors knowing that those supposed investments will fail.
A huge group of miscreants. Pathetic.
SEC Probes $1.5 Billion Merrill CDO Sale
Published: Tuesday, 14 Jun 2011 | 8:22 PM ET
http://www.cnbc.com/id/43402844
It also marks a broadening of the SEC’s investigation into the role of collateral managers, institutions that help select the assets included in CDOs.
NIR Capital Management, a Roslyn, New York firm run by Corey Ribotsky, served as manager for the security under scrutiny, a $1.5 billion CDO known as Norma. Neither Mr Ribotsky nor his attorney returned calls seeking comment.
Regulators are looking at whether collateral managers, which are supposed to serve CDO investors’ interests, fulfilled their obligations, these people say.
According to Rabobank’s lawsuit, Merrill allegedly created Norma as a “tailor-made way to bet against the mortgage-backed securities market”. The suit said: “Merrill Lynch hand-picked a beholden collateral manager that was willing to ignore its fiduciary duties to Norma’s investors by selecting Norma’s collateral pool at Merrill Lynch’s behest rather than on the basis of the rigorous independent analysis.”
original post by hugh jackoman
EIGH ETRADE SHAREHOLDERS..PLEASE SEND IN YOUR INFO AS REQUESTED!!!
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=64140381
FYI
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Currently, E*Trade will be the focus of the Company’s actions being the only brokerage to admit short positions held by them in EIGH.pk, but the Company is now undertaking further examination of an additional 12 brokerage firms it is convinced hold short positions.
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Ref
Shareholders who have shares held within E*Trade accounts should send the following as proof of ownership together with the completed, attached Application Form directly to (i) 8000 Inc., Attn: Thomas Kelly, President, 10432 Balls Ford Road, Suite 300, Manassas, Virginia 20109 or (ii) e-mail directly scanned copies to enquiries@8000inc.net. The Application Forms require a shareholder to submit the following (a) a copy of their account detailing the number of shares held in their E*Trade account and (b) a signed approved application form attached below. These documents will be compiled and sent to the TA.
http://www.facebook.com/notes/8000inc/shareholder-statement-board-meeting-and-board-decisions-june-3-2011-relating-to-/10150199077752844
http://www.facebook.com/notes/8000inc/application-form-just-print-this-off-or-paste-it-in-to-an-email/10150200722527844
APPLICATION FORM
8000 INC. (a Nevada Corporation)
APPLICATION FOR REPLACEMENT OF STOCK CERTIFICATE PURSUANT to NRS 78.250 APPROVED CANCELLATION OF CURRENTLY ISSUED COMMON SHARES
Applicant: ______________________________________________________
Address: ________________________________________________________
Contact tel, fax, e-mail:________________________________________
The Applicant submits herewith the attached documents in support of the Certificate/stock replacement agreeing to the Company placing a stop on their currently held shares in EIGH.pk identified and held at E*Trade, and their ultimate cancelation to be replaced with new certificates if required at the conclusion of the share count undertaken by the Company’s TA.
(a) a copy of their account detailing the number of shares held in their E*Trade account; and
(b) this Application Form as executed below.
This Application Form should be filed with the Company no later than by 4pm EST, June 20, 2011.
Date: _______________, 2011
Registered Name on the Certificate: _____________________________
Authorized Signature: ____________________________
Thanks 100 mph!
My one allowed EIGH post for the day!
RocketMan: Spot on, its coming! Go FFGO!!!
EarnestDD: Of course the transfer agent has a list of shareholders that own shares in certificate form. Those certificates are not however on either the OBO or NOBO lists and that is the point. Those totals when combined were about 3 million shares short of equalling the tradable float. We know a single shareholder owned a 12 million share cert. How many others hold shares that are part of the tradable float? Do the math and you can't help but come to the conclusion that if in fact the free trading certed shares were 4 million or greater a short existed even if it was not talked about in the PR. Some posters here only want to look at the negative side and are making judgements accordingly. All the facts are not yet known.
I will reserve making judgements until they are. Go CDIV!!!
My final allowed post for the day.
P.S.Earnest: I have a recent email from management stating that the outstanding has not increased by a single share.
The transfer agent is not gagged to the SEC. No judgements made by me until the facts are public.
EarnestDD: If you recall we were never provided the total for the shares held in certificate form. The totals we were provided with were a little more than 3 million shares short of equaling the float. We have since learned that one shareholder owned shares totaling 12 million. If in fact those shares were all free trading shares that he purchased that single shareholder's holdings would be indicative of a large short position and that is merely a single shareholder, no doubt many more than one shareholder holds their shares in certificate form. We also know that the total number of shares outstanding had not increased by a single share in well over a year. Lets get all the facts out in the open and let the chips fall where they may. I will not make any judgements until that happens. Go CDIV!!!
dalla: IMHO that is done for show and not a real offer. My last purchase of a little more than 8 million shares took hours to fill. Go FFGO!!!
RocketMan: Even though I do not qualify I am very excited for the long longs to be getting their long overdue compensation. I would think that many of those long longs are no longer even following what is going on with the former Great West Gold. Can you imagine what a pleasant surprise it will be for many of them?
In our present economic situation I am sure it will prove helpful to many. Go FFGO!!!
RocketMan: As management told us the length of the wait was uncertain but that most shareholders would be pleased with a return of 3400%+. Truer words were never spoken. Go FFGO!!!
Canada: Like you I am hoping Monk is vindicated. I have never met nor spoken to the man but do know several folks who have and they continue to believe in him. I know that most of the posters posting here are doubtful and have already judged him to be guilty. They believe he was selling as he encouraged folks to buy and hold. We know for a fact he made one sale but for all we know that could have been part of a set up. Then again, he could be guilty of doing what many who post here are claiming. Time will be the teller and the truth will eventually be out in the open. Until all the facts are in all we can do to help our cause is to encourage any and every Etrade customer to promptly file the signed affadavit and screen shot of their holdings with the company as requested. Go EIGH!!!
goalpost: You ask a question that is impossible to answer. Our country and the rest of the world is in trouble because of financial fraud committed by many. We have the rules and regulations in place that would prevent much of what is happening if they were being followed and enforced. Naked shorting could be stopped overnight if regulators had the courage and will to do it. FTD's could and should be eliminated. I believe it was former SEC Chairman Cox who asked "how much fraud are you willing to accept?" Until enough investors in our markets make it clear that they have a zero tolerence for fraud and demand its elimination it will persist. I hope every person invested in our markets is reading the expose by Jeff Mitchell chapter by chapter.
I purchased shares of CDIV because I believed a large number of non existant shares had been sold into our markets. I still believe that to be the case. Regardless of the consequences I want justice to be served and let those who deserve it face criminal charges and prosecution. The SEC is doing exactly what was asked of them by those on both sides of this battle. Hopefully the SEC investigation will be led by an honest regulator whose mission is to protect and serve. Go CDIV!!!
It's getting interesting!!!!!!
http://domasjefferson.com/news/ctrl-alt-bernanke-anonymous-releases-2nd-video-calling-for-fed-chairman-ben-bernanke-to-resign
original post by ezaltheladiespa
That post is "priceless"! Thanks and go BCIT!!!
This is one of my favorite posts by Vianna:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57609132
She has spelled everything out very clearly and I love the $3,454. return per million shares owned. Risk $100.00 for an almost $3,500.00 return? Sure makes having to wait easier when the payday provides that kind of return. Go FFGO!!!
That opens the door to lots of possibilities. It also provides an opportunity for all trades to settle. Did the EIGH investigation spill over into CDIV as many of us requested? I would think all the trading records would be looked at. What will those records reveal? How many CDIV shares are held in certificate form? Is the float still less than 66 million shares? Is the outstanding unchanged in over a years time? What will the OBO and NOBO lists combined with the shares held in certificate form total? Find the truth SEC and bring civil and criminal charges against those who are deserving of them. Go CDIV!!!
RocketMan: I am seeing price up 50% at the moment on volume of a little under 8000 shares. Go NMGL!!!
Until our markets have been cleaned up "some" their is no point in having BCIT trade imho. Progress is being made to that end but it is slow. Read this sentence takend from GS most recent quarterly report and then think about it for a bit.
"In its quarterly report, Goldman said the Commodity Futures Trading Commission's staff has "orally advised" the bank that it "intends to recommend" that the agency file "aiding and abetting, civil fraud and supervision-related charges" against Goldman's trade-clearing unit."
http://online.wsj.com/article/SB10001424052748703864204576314850051371180.html
Will criminal charges be forthcoming? Set the example with the biggest and show them that fraud in our markets is no longer going to be allowed. Send some folks to jail and let it be known this is just the beginning and watch how quickly things will change.
Slap on the wrist fines won't cause the real changes we need to see but jail sentences will imho. Go BCIT!!!
Will GS disclose their stock trading problems I wonder?
"The U.S. regulator for commodities trading threatened Goldman Sachs Group Inc. with possible civil-fraud charges over the firm's role in clearing trades for a client." Will anyone be charged criminally?
In its quarterly report, Goldman said the Commodity Futures Trading Commission's staff has "orally advised" the bank that it "intends to recommend" that the agency file "aiding and abetting, civil fraud and supervision-related charges" against Goldman's trade-clearing unit.
Criminal charges need to be brought imho!
Chas: BCIT is like a time bomb and because it could go off at any time is being watched continuously. Everyone connected to this crime scene is locked in. When the time is right exposure will come as will restitution. Until that happens we wait. Go BCIT!!!
UkPeter: No problem at all, you may have missed this PR:http://www.marketwire.com/press-release/ASPA-Gold-Corp-Announces-the-Appointment-of-an-Investor-Relations-Firm-1405331.htm
Go RENS!!!
The Miscreants’ Global Bust-Out (Chapter 15): Ali Nazerali in Aruba, and an Al Qaeda Financial Weapon Called PTech
by Mark Mitchell
12 June 2011
The ties that bind a Russian arms dealer, a dangerous mobster, Osama bin Laden's favorite financier, a destructive financier, and the former chief of FBI counter-terrorism
http://www.deepcapture.com/the-miscreants-global-bust-out-chapter-15-ali-nazerali-in-aruba-and-an-al-qaeda-financial-weapon-called-ptech/
The Miscreants’ Global Bust-Out (Chapter 15): Ali Nazerali in Aruba, and an Al Qaeda Financial Weapon Called PTech
by Mark Mitchell
12 June 2011
The ties that bind a Russian arms dealer, a dangerous mobster, Osama bin Laden's favorite financier, a destructive financier, and the former chief of FBI counter-terrorism
http://www.deepcapture.com/the-miscreants-global-bust-out-chapter-15-ali-nazerali-in-aruba-and-an-al-qaeda-financial-weapon-called-ptech/
Where there is smoke there is often fire:
http://content.usatoday.com/communities/theoval/post/2011/06/china-says-the-us-is-already-defaulting-on-debt/1
Duke: You said "is Cascadia Investments (CDIV)
still on the way...
...to Its Goal of Becoming the Largest Apple Game App Distributor?...
...I've got ten million dollars burning a hole in my pocket...Duke... "
As far as I know that is still the goal and as you know Apple growth is off the charts. If you use some/all of that ten million to either aquire shares and/or make a tender offer it sure would make things interesting! The outastanding has not increased by a single share in over a year according to management. Go CDIV!!!
The EIGH issue is all about "airshares". Presently a call has gone out to all who have EIGH "markers" in their account at Etrade to fill out the simple affadavit the company has provided, sign it and forward it along with a screen shot of your Etrade account reflecting those "markers". The goal is to provide undeniable proof that cannot legally be ignored by regulators.
Once provided, regulators should have no choice but to enforce existing rules and regulations or look foolish for not doing so.
If those rules and regs are enforced and Etrade is ordered to buy back the non existant shares they sold it will cause an increase in shareprice. That action should cause others who also sold non existant shares to do the same. Every person who wants fraud eliminated from our markets should be in favor of this happening.
How can anyone claim to be against fraud by company management on one hand and for fraud by those selling non existant shares on the other? Some folks have repeatedly claimed no short position existed or if one did it was minimal. Here is an opportunity to show your support of ferreting out the truth by encouraging all Etrade clients to file the affadavit and screen shot as requested.
Go EIGH!!!
My one allowed post for the day!
tenn: Both the longs, those who purchased shares, and the shorts, those who sold non existant shares, are trapped and the records of both are available for regulators or legal eagles to examine should they choose to. When the time is right all will be freed from being trapped and then hopefully those short will be forced to buy back the non existant shares they sold at a premium price to those who had purchased them. Go BCIT!!!
Tom: You made the claim that Dave sold the stock he had been granted and that the sale of his shares was responsible for the price drop that occured. Are you now claiming you called him prior to making this assertion or that you asked him if he did or did not sell any/all of his shares? Go FFGO!!!
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=64020611
onehundredmph: Thanks for posting the links. Mine are on the way as of yesterday but no doubt some Etraders who don't post will appreciate your effort. I hope every Etrade client makes the time to do this since it is an opportunity to expose the corruption in our markets that we little guys don't often have. Everyone who takes the time to post here should be supportive of this effort being made by Etrade EIGH shareholers without exception. Go EIGH!!!
My one allowed post for the day!
Some very interesting news covered here:
http://www.offshorealert.com/
SevenTenEleven: Spot on! We have way way to many folks who sold their souls for a few pieces of silver as well as those who are too weak to stand up and be counted. These message boards serve as a good example with those in control limiting what can be said and by whom and at the same time intimidating the majority who are afraid to speak up and express their opinions for fear of being attacked. Sadly we have few patriots as well. Look at how truthtellers like Patrick Byrne are attacked and portrayed by some as being crazy all for a few pieces of silver. We badly need leaders with integrity and courage.
fourkids_9pets:
I don't own this one but it too is one of the 17 suspended by the SEC. I wonder what the trading records would reflect here:
The NASA Penny Stock That Has Come Crashing To Earth
http://blogs.forbes.com/nathanvardi/2011/06/07/the-nasa-penny-stock-that-has-come-crashing-to-earth/
SEC now turns the spotlight on SAC?
http://money.cnn.com/2011/06/09/news/companies/insider_trading_sec/index.htm?iid=HP_LN
High & Low Finance
Troubled Audit Opinions
By FLOYD NORRIS
Published: June 9, 2011
On one side is an assessment of a company with a clean audit opinion from the Toronto office of Ernst & Young, and with bonds rated just below investment grade by Standard & Poor’s and Moody’s. It has raised billions in capital markets.
On the other is an investment research firm using the name Muddy Waters Research. It says the company, the Sino-Forest Corporation, is a fraud, and that its shares are worthless.
As this is written, there is no definitive answer as to who is right. But the initial reaction of the markets seemed to be that they had more trust in the short-seller — a company whose Web site gives no address — than in the auditor’s opinion.
The shares, traded in Toronto, lost more than 70 percent of their value in two days, shaving $3 billion off its valuation. Bond prices also plunged. Prices had to fall sharply before speculators could be found who were willing to bet that the financial statements really did, in the boilerplate words of the auditor’s letter, “present fairly, in all material respects, the financial position of Sino-Forest Corporation.”
If there was a fraud, there is no doubt that Ernst & Young will be sued, and there is even less doubt that it will deny responsibility. After all, its letter did make clear that management was responsible for the internal controls needed to assure the statements are “free from material misstatement, whether due to fraud or error.”
To the auditing industry, the fact that investors tend to blame auditors when frauds go undetected reflects unrealistic expectations, not bad work by the auditors. The rules say auditors are supposed to have a “healthy degree of skepticism,” but not to detect all frauds.
“There is a significant expectations gap between what various stakeholders believe auditors do or should do in detecting fraud, and what audit networks are actually capable of doing, at the prices that companies or investors are willing to pay for audits,” stated a position paper issued in 2006 by the chief executives of the six largest audit networks.
Note that last part. They suggested that if investors were really worried about fraud, they should consider paying more for a “forensic audit” that would have a better — but not guaranteed — chance of spotting fraud. Don’t like our work? Pay us more.
There is no doubt that some companies are easier to audit than others, and that Sino-Forest falls on the harder side. While it has headquarters in Toronto and Hong Kong, its operations are — or at least are claimed to be — spread out over much of China. The company says it manages nearly two million acres in forest plantations across China. Muddy Waters says that is a lie, and that its actual operations are much smaller.
Investors trying to decide whether to believe the Muddy Waters report, with its detailed assertion that the company’s claims are contradicted by Chinese records, would love to know just what Ernst did to check. What records did it inspect? Which tree plantations did it visit? Who did the work? Was it people from Ernst’s Toronto office, which signed the report, or people from a Chinese affiliate? How many auditors did the work, over what period of time?
Ernst’s audit opinion does not say, which is no surprise. Virtually every audit opinion in the world says almost the same thing, with no details about the company being audited. Auditors are paid millions of dollars to produce a report that no one thinks is worth reading.
On June 21, the Public Company Accounting Oversight Board, which regulates auditors in the United States, plans to ask for public comments on whether to require auditors to do more and say more.
One idea the board is expected to consider is requiring auditors to disclose more about what they did, and did not, do. Ideally, auditors would point to things that they could not audit. There are a lot of them now, and sometimes they are crucial.
“The foundation” of the Sino-Forest fraud, stated the Muddy Waters report, “is its convoluted structure whereby it runs much of its revenues through ‘authorized intermediaries.’ ” Those organizations supposedly process tax payments owed to China on wood production, the report said, thereby assuring the company “leaves its auditors far less of a paper trail.”
Auditors could be called upon to specify where they thought fraud was most likely in a given company or industry, and what they did to confront the risk. Investors could have a chance then of comparing the work of differing audit firms, as one firm disclosed it had checked something other auditors did not mention.
If an audit was expected to call attention to possibly critical information that was not available to the auditors, perhaps there might be pressure from investors on companies to make that information available. In any case, investors could better understand what the auditors knew — and did not know — in reaching their conclusions.
The problems with audits now go well beyond questions of fraud. A critical element for many banks is the valuation of securities that trade infrequently, if at all. There may be a wide range of possible estimates, and the auditor now must simply conclude the estimates are within that range. If so, it signs off.
To make things worse, the estimates may have come not from the company being audited, whose work the auditor can examine, but from a pricing service that views its models as proprietary, making them virtually impossible to audit. That fact is something investors should know, but now do not.
Nor do auditors disclose information about how reasonable an estimate is. In some cases, a wide range might be defensible, and investors have no way to know whether a company was particularly conservative or aggressive in its estimates. The oversight board may consider asking that companies disclose what they deem to be the range of reasonable estimates, and why they chose the one they did. Then the auditors could comment on that.
If auditors enforced some consistency on ranges, then financial statements of different companies might be more comparable, even though they chose different estimates.
The accounting oversight board is also expected to ask if it is time to end the “one grade fits all” audit model, in which every company is deemed to “fairly” present its results. Perhaps a second grade could be added, like “presents adequately,” for companies that push the envelope but do not violate the rules.
In addition, auditors could be called upon to discuss the risks the company was taking. They could also be asked to call attention to some of the most critical disclosures in the footnotes, something that French auditors already do.
If much of that happened, audit opinions could become a lot more interesting to read. Investors might actually learn something, and they might be able to form opinions about differences in audit firms.
Another long-overdue change would be to have the lead partner on an audit sign the opinion in the annual report. Now, the firm signs, and investors have no way of knowing who was responsible. If an audit signed by a certain partner later blew up, that could be devastating to his or her career if investors shied away from any companies whose audits he later signed. Would that make auditors more careful? Perhaps.
This week, as the controversy over Sino-Forest raged, Canadian regulators began an investigation and the company indignantly defended itself. “I have spent 17 years building Sino-Forest and I can promise investors we are not guilty of the charges levied against us,” said Allen Chan, the chairman. “Our financial statements have been audited by Ernst & Young a leading international audit firm....”
Its board appointed a special committee of three directors, all Canadians who served on the company’s audit committee and including a former Ernst partner, to investigate. The committee hired PricewaterhouseCoopers, another member of the Big Four.
Investors seemed confused. After the plunge of last week, the shares bounced around on extremely heavy volume this week. They rose a bit on Thursday to 5.15 Canadian dollars ($5.26), but were still down 72 percent from the price of 18.21 Canadian dollars just before the charges were aired last week.
Moody’s said it will review its ratings and “seek to assess the veracity of the claims” made by Muddy Waters. It gave details of what it would check.
But Ernst was mute, unwilling to either defend its work or discuss how it had reached its now-questioned conclusion that the financial statements “present fairly” the company’s condition. Investors who relied on the audit will just have to wait.
“It would be inappropriate to make any comment while the work of the special committee is ongoing,” said Amanda Olliver, a spokeswoman for the audit firm in Toronto. “In any event,” she added, “our professional obligations prevent us from speaking about client matters.”
http://www.nytimes.com/2011/06/10/business/10norris.html?_r=1&src=tptw
original post by scion
Tom: I've been telling you for a while now that when you have questions you want answered you should really call Dave. He is easy to talk to and if he doesn't have the answer you seek will inquire about it and get back to you. You seem to have many questions you would like answered so why not pick up the phone and call. Makes a lot more sense than making false assertions.
Go FFGO!!!
Just mailed my affadavit and copy of my Etrade holdings to Mr. Kelly, hope other Etrade EIGH shareholders are doing the same.
Go EIGH!!!
My one allowed post for the day!