BF Borgers’ Audacious Audits (or how NOT to grow an audit practice)

While signs of the demise of BF Borgers’ public company audit practice had been emerging for years, the US Securities and Exchange Commission (“SEC”) put the final nails in the coffin by issuing a cease and desist order and permanently barring the audit firm BF Borgers CPA PC and its owner, Benjamin F. Borgers (“Borgers”) from practicing before the SEC. The May 3rd, 2024 SEC press release presents a rather jolting headline, “SEC Charges Audit Firm BF Borgers and Its Owner with Massive Fraud Affecting More Than 1,500 SEC Filings”.

As one digests the SEC Order and the actions and inactions of Borgers, the breadth and depth of the egregious fraud is shocking in the deliberate and systemic failures to perform its audits and reviews.  Without detailing all the numerous failures to comply with the Public Company Accounting Oversight Board (“PCAOB”) auditing standards, it may be that the one thing they did right was to obtain engagement letters from their clients, however, even those were misleading as they stated that the audits and quarterly reviews would be conducted in accordance with PCAOB standards. The categories of audit failures include Failure to Properly Prepare and Retain Audit Documentation, Failure to Supervise and Review the Work of The Engagement Team, and Failure to Obtain Engagement Quality Reviews.

Source: BF Borgers’ Audacious Audits (or how NOT to grow an audit practice)