Virtas Partners was engaged by a Private Equity-backed company to investigate historical accounting irregularities, transition the current CFO out of the company and prepare for the company’s first audit by a Big 4 audit firm.
Client Background
The incoming Big 4 audit firm for our client identified the need for a consulting firm to investigate historical accounting, replace the CFO on an interim basis and prepare the company for the audit. Within the first three weeks of our engagement the CFO and controller left the company. We investigated, identified and corrected accounting errors spanning multiple years. This required accessing data from multiple systems and locations (including international locations) and re-creating an audit trail without any of the historical knowledge or support from the previous finance team.
In addition, we implemented accounting process improvements to reduce the risk of the same accounting errors in future accounting. For a period of six months, neither the controller or CFO were replaced and Virtas provided interim resources to assist with the ongoing accounting and finance needs. We also participated in the recruiting process sourcing candidates and interviewing candidates for the open finance positions. Virtas participated in the drafting of the financial statements, prepared all data requests for the audit and worked through all accounting/audit issues and findings directly with the audit team.
Scope of Services
- Investigated, identified and quantified historical accounting errors and restatement adjustments
- Complete download of accounting process to allow for transition of CFO and controller out of the company
- Design of accounting processes as controls for future state finance organization
- Operation of the finance function in interim management roles
- Management of the audit process preparing all data requests and directly working with the audit team through their procedures
Significant Milestones
- Transition of CFO and controller roles
- Identified and corrected historical accounting errors
- Implementation of improved accounting processes
- Resolution of all open accounting / audit issues
Value to Client
- Resolution and correction of historical accounting errors
- Transition interim support of key finance positions
- Resolution of accounting/audit issues for first Big 4 audit