Error Corrections – A Look at Adjustment and Restatement Trends

Accounting corrections are arguably one of the most important metrics in understanding trends in financial reporting. In some of our previous blogs, we discussed the differences between material and immaterial errors, and different regulatory requirements associated with different types of … Continue reading

EBay Reports Material Weakness: Second Control Deficiency in Three Years

Last week on February 6, in its Fiscal 2016 10-K, eBay (EBAY) disclosed a material weakness in its internal controls over financial reporting (“ICFR“). The deficiency related to a failure to properly apply tax accounting and affected the Deferred Tax Asset and Income Tax Benefit … Continue reading

Literature Review: “Qualitative Characteristics of Financial Reporting Errors Deemed Immaterial by Managers”

In this post, we look at a recent paper titled “Qualitative Characteristics of Financial Reporting Errors Deemed Immaterial by Managers” by Preeti Choudhary, Kenneth Merkley, and Katherine Schipper. The authors use Audit Analytics’ databases on restatements and immaterial error corrections to provide an in-depth analysis of the … Continue reading

Non-GAAP Metrics in SAB 99 Materiality Analyses

The pros and cons of non-GAAP metrics have been discussed in more than a few recent articles. Proponents of non-GAAP frequently claim that GAAP contains many ambiguities and loopholes, and that non-GAAP metrics can be more current and relevant. Opponents sometimes … Continue reading