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Financial Statement Fraud Casebook: Baking the Ledgers and Cooking the Books by Joseph T. Wells

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Chapter 3

Trust Us . . . We Wouldn't Lie to You

Independently and Objectively Research Every New Client

Stephen Pedneault

Inland Distributors was a new client of Shipman Calabrese, a regional public accounting firm where I worked as a manager. Josh Addison, a well-respected banker with Family Bank and a good friend to Shipman Calabrese, had recommended that the owners of Inland, who were seeking new auditors, contact our firm. Shipman Calabrese had a great reputation with Josh and Family Bank. According to Josh, the owners of Inland Distributors, a large distributor of machinery with annual revenues of approximately $25 million, were in discussions with him to restructure the company's financing and potentially move their borrowing and banking relationships over to Family Bank. Leading Inland was Sam Forde — a primary shareholder who was also the president and chief executive officer. Brad Crossman was Inland's chief financial officer and, working under Brad, Evan Bowers was the controller.

My role at Shipman Calabrese was one of a utility player with significant experience. When there were risky or new engagements, our engagement partner would frequently add me to the traditional audit team, to complement the skills and experience brought by the other firm members. Frequently the firm would have a scheduling need and place me on a traditional audit team simply to ensure an engagement was adequately staffed, even if it was an engagement outside of my specialty, the forensics field. ...

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