SEC Suspends Former BDO Accountants for Improperly “Predating” Audit Work Papers

The Securities and Exchange Commission today suspended three former BDO USA LLP accountants for their improper professional conduct during an audit of an exchange-listed insurance company. According to the SEC’s order, BDO fell behind schedule while conducting its 2013 integrated audit of AmTrust Financial Services Inc. and ultimately failed to complete necessary audit procedures before AmTrust’s deadline to file its annual report with the SEC. To create the appearance that BDO’s audit was in fact complete, the senior manager on the audit engagement, Lev Nagdimov, instructed BDO’s audit team to sign off on all work papers and audit programs regardless of whether its work was finished. Nagdimov further instructed BDO’s audit team to load and sign blank or placeholder work papers in BDO’s electronic files.