Denver Accounting Firm Settles SEC Case

Denver-based Levine Hughes & Mithuen settled a Securities and Exchange Commission complaint related to its audit work, paying a $50,000 fine and neither admitting nor denying wrongdoing, the Rocky Mountain News reported.

The firm was accused by the SEC of destroying documents and altering work papers as the SEC investigated Sport-Haley Inc., a client of Levine Hughes & Mithuen, which is ranked as the 19th largest accounting firm in the Denver area.

As part of the settlement, the firm agreed not to practice accounting before the SEC, but it can apply to be reinstated in three years. It cannot, however, audit public companies any longer.

The SEC is suing Denver-based sportswear maker Sport-Haley, alleging the company overstated its inventory in 1998, then tried to minimize the problem by writing off the overstatement over time, rather than recognize the loss all at once, the Rocky Mountain News reported. The SEC also makes allegations about improper recording of expenses and other special charges.

The SEC alleges that Sport-Haley overstated 1998 fiscal year income by $1.5 million, or 41 percent, and its 1999 fiscal year income by $311,000, or 22 percent, the Rocky Mountain News reported.

Levine Hughes & Mithuen partners and staff were accused by the SEC of "improperly altering" its Sport-Haley work papers. The SEC also claimed that says a staff accountant for the firm disposed of Sport-Haley documents that remained in the firm's office after the 1999 audit, among other allegations.

Sport-Haley terminated Levine Hughes & Mithuen in July 2000 and replaced the firm with Denver's Hein & Associates, the Rocky Mountain News reported, adding that Levine Hughes & Mithuen re-signed its two last public-company clients in the last two years.

You may like these other stories...

Here's a CPA who truly walks the walk. On March 15, Frank Ryan, CPA, departed San Diego, California, with plans to be in Ocean City, Maryland, by July 2 to teach a course at the Maryland Association of CPAs’ (MACPA...
When Theodore J. Flynn first joined the Massachusetts Society of CPAs (MSCPA) in 1970, it was a different world and a different profession.  The "Big Eight" were still headquartered in Boston. Vietnam War...
Accountant Rickey Charles Goodrich had it a little too good. Many bean counters would kill to serve as financial guru to the likes of Pearl Jam. Goodrich was hired in 2005, and the following year, he became the CFO of Curtis...

Already a member? log in here.

Upcoming CPE Webinars

Aug 26
This webcast will include discussions of recently issued, commonly-applicable Accounting Standards Updates for non-public, non-governmental entities.
Aug 28
Excel spreadsheets are often akin to the American Wild West, where users can input anything they want into any worksheet cell. Excel's Data Validation feature allows you to restrict user inputs to selected choices, but there are many nuances to the feature that often trip users up.
Sep 9
In this session we'll discuss the types of technologies and their uses in a small accounting firm office.
Sep 11
This webcast will include discussions of commonly-applicable Clarified Auditing Standards for audits of non-public, non-governmental entities.