As a result of a decision by the hearing panel of the Joint Trial Board, Mr. Brescia was admonished effective June 2, 2012. Mr. Brescia was also directed to provide the Ethics Charging Authority with an attestation every six months for two years, starting in November 2012, that he has not performed any audits or reviews.
Mr. Brescia was found guilty of violating the following rule of the AICPA’s Code of Professional Conduct:
Rule 202 – Compliance with Standards
1. The original auditor’s report on the 2002 financial statements failed to comply in several material respects with the requirements of AU §508. (AU §508.08)
2. A comparative Statement of Net Assets Available for Benefits and a separate or combined statement of plan income and expenses and changes in net assets as required by DOL regulation CFR 2520.103-1(b)(2) was not presented in the original financial statements. (AICPA Audit and Accounting Guide for Audits of Employee Benefit Plans with Confirming changes as of May 1, 2002 (AAG-EBP) 3.10)
3. The original financial statements omitted all required note disclosures. (SAS 32, AU §431)
4. The original and revised financial statements did not attach the required supplemental schedules required by ERISA. (AAG-EBP Appendix A, Exhibit A-1)
5. The revised financial statements failed to disclose the following:
a. Net change in each significant type of investment. (AAG-EBP 3.25)
b. Description of the method and significant assumptions used to determine the fair value of investments. (AAG-EBP 3.27)
c. Identification of investments that represent 5 percent of total net assets. (AAG-EBP 3.28)
d. The use of estimates. (AAG-EBP 3.34, SOP 94.6)
e. The financial statements inappropriately reflected distributions payable. (AAG-EBP 3.28l)