In its first disciplinary action, the Public Company Accounting Oversight Board (PCAOB) on Tuesday revoked the registration of a public accounting firm, barred the managing partner of the firm from association with any registered accounting firm and censured two former partners of the firm.

New York accounting firm Goldstein and Morris CPAs, P.C. was notified in September 2004 that the firm would be inspected by the PCAOB in November 2004. The Board found that after managing partner Edward B. Morris and two partners Alan J. Goldberger and William A. Postelnik attempted to conceal, by omitting requested information from their response to the inspection request, that they knew the firm had prepared financial statements for two public company audit clients in violation of federal law requiring auditor independence. Further, the Board found that all three partners created back-dated documents and placed them in the firm’s files in order to conceal the firm’s failure to comply with certain auditing standards.

Messrs. Goldberger and Postelnik notified the PCAOB of the omitted and falsified information. Both have resigned from the firm. The Board limited the sanctions of the two men to censures because they “promptly and voluntarily brought the matter to the Board’s attention, disclosed their own misconduct and the misconduct of others, and made affirmative efforts to provide the Board with relevant information.”

“Registered accounting firms and their associated persons have a duty to cooperate in PCAOB inspections,” said Claudius Modesti, director of the PCAOB’s Division of Enforcement and Investigations. “The findings in this case demonstrate that the Board will not tolerate conduct aimed at thwarting the Board’s inspections.”