US markets regulator SEC on Friday charged Grant Thornton India llP and Australia-based group firm Grant Thornton Audit Pty ltd with auditor independence violations that occurred when two partners served on the boards of Mauritius-based subsidiaries of their clients.
These partners served on the boards of the companies that were Grant Thornton audit clients and performed non-audit services prohibited under the SEC’s auditor independence rules, the regulator said in a statement.
Without admitting or denying the findings, both entities have agreed to cease and desist from future violations. However, the names of the clients were not disclosed.
“GT India agreed to pay disgorgement of audit fees in the amount of $128,905, plus prejudgement interest of $8,977,and a penalty of $50,000.
“GT Audit agreed to pay disgorgement of $88,683, plus prejudgement interest of $13,520, and a penalty of $75,000,” SEC said.
The watchdog has censured the two audit firms for violating the auditor independence standards besides sanctioning them for causing the issuers to violate the requirement to file annual reports with the Commission.
“The orders also found that the audit firms engaged in improper professional conduct in violation of federal securities laws and the Commission’s Rules of Practice,” SEC noted.