Auditing

Auditor Resigns from Subprime Lenders

Grant Thornton is quickly distancing itself from the embattled industry.
Stephen TaubApril 3, 2007

Grant Thornton has resigned as auditor of at least two subprime lenders, Accredited Home Lenders Holding and Fremont General.

In separate regulatory filings, both companies disclosed that Grant Thornton had advised them of the “need to significantly expand the scope of its audit” of their financial statements.

Accredited stressed that since it hired Grant Thornton on June 14, 2005, there have been no disagreements between the company and the auditor “on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure.”

Drive Business Strategy and Growth

Drive Business Strategy and Growth

Learn how NetSuite Financial Management allows you to quickly and easily model what-if scenarios and generate reports.

The company also noted that there were no reportable events, other than Grant Thornton’s advisory that it needed to expand the scope of its audit, adding that its audit committee is reviewing the circumstances relating to the resignation.

Fremont also stressed that since it hired Grant Thornton on August 8, 2006, there have been no disagreements between the company and the auditor and no reportable events.

The lender did acknowledge that in late February, Grant Thornton asked for additional information and stated that it needed to perform additional procedures and testing to complete its audit. Fremont asserted that it provided all requested information in a timely manner and that it “repeatedly” requested that Grant Thornton complete its audit, without seeking to place any limitations on the firm.

Both Accredited and Fremont stated that they have begun the process of selecting an accounting firm to succeed Grant Thornton.