PCAOB Sanctions SS Accounting and Auditing Inc. and Partner for Multiple Violations of PCAOB Rules and Standards

The Public Company Accounting Oversight Board (PCAOB) today announced a settled disciplinary order sanctioning SS Accounting and Auditing Inc. (the “Firm”) and Saima Sayani, CPA (“Sayani”), a partner and the sole owner of the Firm, for violations of various PCAOB rules and standards in connection with two audits of an issuer, China Green Agriculture, Inc., and for violations of PCAOB quality control standards. The PCAOB also found that Sayani, as the Firm’s sole owner, directly and substantially contributed to the Firm’s quality control violations.

“The misconduct in this matter presented significant risks to investors, including failing over two years to obtain sufficient appropriate audit evidence supporting the audit opinion on a public company’s financial statements,” said PCAOB Chair Erica Y. Williams. “When auditors put investors at risk, the PCAOB will take enforcement actions to hold those auditors accountable.”

The violations committed by the Firm and Sayani include:

• Failing to obtain sufficient appropriate audit evidence and to perform sufficient audit procedures for multiple significant accounts, including revenue and inventory;
• Failing to perform sufficient audit procedures to test journal entries in response to the risk of fraud;
• Failing to make certain required audit committee communications;
• Failing to determine critical audit matters; and
• Failing to identify significant findings and issues in an engagement completion document.

Additionally, the PCAOB found that (1) the Firm’s system of quality control failed to provide reasonable assurance that the work performed by the Firm’s engagement personnel would meet applicable professional standards and regulatory requirements and (2) the Firm failed to conduct any monitoring of its quality control system.

“The Firm and its partner violated PCAOB standards in the conduct of the audits and failed to implement quality control policies and procedures to safeguard against these violations. The sanctions imposed by the Board on the respondents reflect the seriousness of those failures,” said Robert E. Rice, Director of the PCAOB’s Division of Enforcement and Investigations. 

Without admitting or denying the findings, Sayani and the Firm consented to the PCAOB’s order. The order:

• Censures both respondents and imposes a $65,000 civil money penalty, jointly and severally, upon them;
• Revokes the Firm’s registration with a right to reapply after two years;
• Bars Sayani from associating with a registered public accounting firm, with a right to petition the Board to terminate her bar after two years;
• Requires the Firm to undertake remedial actions to improve its system of quality control before reapplying for registration; and
• Requires Sayani to complete 50 hours of additional continuing professional education and training before seeking to terminate her bar.

PCAOB enforcement staff members Robyn Baggetta and Tina Bell conducted the investigation, with assistance from K Lynn Dunston, and were supervised by Kyra Armstrong, William Ryan, and John Abell.

The PCAOB oversees auditors’ compliance with the Sarbanes-Oxley Act, provisions of the securities laws relating to auditing, professional standards, and PCAOB and SEC rules.

Further information about the PCAOB Division of Enforcement and Investigations is available on the PCAOB website. Firms or individuals wishing to report suspected misconduct by auditors, or to self-report possible misconduct, may visit the PCAOB Tips and Referrals page.

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About the PCAOB

The PCAOB is a nonprofit corporation established by Congress to oversee the audits of public companies in order to protect investors and further the public interest in the preparation of informative, accurate, and independent audit reports. The PCAOB also oversees the audits of brokers and dealers registered with the Securities and Exchange Commission, including compliance reports filed pursuant to federal securities laws.

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