Feb 8 (Reuters) - The U.S. watchdog board for corporate auditors on Wednesday said it has imposed a $2 million penalty, its largest fine ever, on accounting and consulting firm Ernst & Young LLP in a settlement involving past audits of Medicis Pharmaceutical Corp.
The Public Company Accounting Oversight Board said it also sanctioned four current and former Ernst & Young partners for violating PCAOB rules in the audits of Medicis, which sells prescription drugs for asthma and skin conditions.
Ernst & Young settled without admitting or denying the PCAOB’s findings. The audits in question involved Medicis’ 2005, 2006 and 2007 financial statements, the PCAOB said.
“These audit partners and Ernst & Young - the company’s outside auditor for more than 20 years - failed to fulfill their bedrock responsibility,” PCAOB Chairman James Doty said in a statement.
“The auditor’s job is to exercise professional skepticism in evaluating a public company’s accounting and in conducting its audit to ensure that investors receive reliable information, which did not happen in this case,” Doty said.