UW's auditor sued by SEC
January 31, 2003
The UW's independent auditor, KPMG, was sued in civil court Wednesday by the U.S. Securities and Exchange Commission (SEC) over its accounting of the Xerox corporation.
The SEC alleges that KPMG knew of and assisted Xerox in manipulating its results to the tune of $1.2 billion between 1997 and 2000.
The company has denied the suit, suggesting it stems from "a disagreement over complex professional judgments."
KPMG has been the UW's independent auditor since it was contracted in 1990, and again in 1996. The University employed no independent auditor until 1990.
According to Max Whisler, director of audits at the UW, there have been no problems with KPMG in the 11 years it has audited the UW.
Whisler had not heard of the lawsuit as of yesterday afternoon and declined to comment on how the suit may impact the UW.
The UW is audited annually by both KPMG and the State Auditor's Office. KPMG looks at the University as if it were a corporation, examining cash flow, revenues and expenses. The state audits the UW largely for compliance with federal and state laws.
Both the state and KPMG gave the UW a clean audit at January's Board of Regents meeting.
KPMG employs more than 100,000 people in more than 150 countries, making it one of the three largest auditing firms in the world.
-- Randy Trick
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