Colorado Audit Firm Fined $150,000 and Faces Registration Revocation

The Public Company Accounting Oversight Board (PCAOB) has imposed a fine of $150,000 on a Colorado-based audit firm, AJ Robbins CPA, and its founding partner, Allan Jeffrie Robbins, for alleged failures in professional skepticism and improper alteration of audit documentation.

In addition to the fine, the PCAOB has revoked the registration of the audit firm and permanently barred Allan Jeffrie Robbins from being associated with any registered public accounting firm.

The regulatory action comes after an investigation into the firm's conduct between 2016 and 2018. During this period, AJ Robbins CPA reportedly issued multiple audit reports and interim review engagements without obtaining concurring approval for issuance from an engagement quality reviewer. This failure to adhere to proper approval procedures raised concerns about the quality of the firm's audits.

Furthermore, the audit firm was accused of failing to conduct two issuer audits with the necessary professional care and skepticism. The PCAOB also noted that the firm did not cooperate with a PCAOB inspection in 2018. The investigation revealed that both Allan Jeffrie Robbins and the firm altered audit documentation inappropriately and provided misleading information to the PCAOB's inspection staff after receiving advanced notice of the inspection.

The PCAOB also found that the firm lacked independence from one of its issuer clients due to a business relationship with an officer and director of that client. The regulator's decision highlighted that the repeated violations across multiple clients and engagements underscored the firm's failure to maintain a system of quality control that ensured compliance with professional standards.

Robert Rice, the director of the PCAOB's Division of Enforcement and Investigations, emphasized the severity of the case, stating, "As this case demonstrates, for severe misconduct, those consequences can include both sizable civil money penalties and permanent bars and revocations."

AJ Robbins CPA's disregard for fundamental rules and standards has raised concerns about the effectiveness of its quality control system. The regulatory action sends a clear message about the consequences of failing to meet professional standards and maintain the integrity of audit processes.

Allan Jeffrie Robbins, when contacted by phone, declined to provide any comment regarding the PCAOB's decision.

By fLEXI tEAM