PCAOB Sanctions U.S. Audit Firm for Violations That Include Failure to Reasonably Supervise an Unregistered China-Based Firm

The Public Company Accounting Oversight Board (PCAOB) today announced a settled disciplinary order sanctioning a U.S.-based registered public accounting firm, TPS Thayer LLC (“the Firm”).

Violations Found By the PCAOB

As described in further detail in the order, the Board is imposing these sanctions based on the Firm’s conduct in connection with five audits of two public companies that have their principal place of business in the People’s Republic of China.

Specifically, the Firm failed to appropriately plan the five audits and failed to reasonably supervise an unregistered public accounting firm – also based in China – that played a substantial role in those audits.

In addition, the Firm failed to properly disclose the unregistered firm’s participation (1) on the PCAOB’s required Form AP and (2) in communications to the audit committees of the public companies.

Sanctions Imposed by the PCAOB

The order:

• Censures the Firm;
• Imposes a civil money penalty in the amount of $100,000 on the Firm; and
• Requires the Firm to undertake certain contingent remedial actions.

Learn More

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.