Grifco Inc (GFCI)

[cyofish]

Rusty, I'm a CPA. What you're saying is not true. Auditing standards for a public company are governed by PCAOB, which was formed as a result of Sarbanes Oxley. AICPA set the standards prior to Sarb-ox. The only difference is that PCAOB made it an requirement for the mangement and Auditor to give an opinon about the company's Internal Controls based on the COSO Framework.

There are plenty of frims out there that are approved by PCAOB. Auditor's duty is not to prove the capitlization of a public company. That is the sole responsibility of management. The job of the Auditor is to review the financials of the company, and render an opinion if

1. If the Auditor agrees with management's assesment of the company's internal control.

2. The Auditor's own assesment of Internal Control

3. If managements assertion made in the financial statment is presented farily in accordance with GAAP.

The Aduitor's letter is pretty standard language and is only one page long. The Auditor can give one of 5 standard opinions on the management's assertion (presentation) of the financial statements

(from best to worse)
1. unqualified (in accordance with GAAP)
2. unqualified with explanatory language (opinion is unqualifed by further explaination is needed on certain item(s)).
3. Qualified (mostly follows GAAP but there some departures)
4. No Opinion (Auditor refuses to give an opinon usually because of uncertatines in what's presented, information can't be adequately verified etc..).
5. Adverse - financial statement doesn't follow GAAP.


If Grifco's financials are too convoluted for the Auditor to make sense (which I doubt), they would either give it a No Opinion or an Adverse Opinion. Only way an Auditor won't give any opinion is if the company fires the Audit firm in middle of an Audit.