Trump’s Accountants Sever Ties, No Longer Stand By Statements
A declaration by an accounting firm that it is dropping a client and backing away from prior financial statements is historically a red flag for investors, lenders or other parties that a company’s financial condition is not what it appears. It can also be a signal to regulators and other authorities that wrongdoing may have occurred, and is often the basis for launching -- or expanding -- enforcement investigations.
“This is bad news for Trump,” said John Moscow, a former prosecutor for the Manhattan District Attorney’s office. “He can’t say, ‘I had top-level accountants doing this work.”’
The letter should be read in the context of James’s filing last month that focused on inflated valuations of Trump Organization assets based on aggressively optimistic assumptions, said Moscow, who is now at Lewis Baach Kaufmann Middlemiss.
“The accounting firm does not say that its work product was false, but they tell the client that it can’t be relied on as accurate,” he said. “If there are unstated assumptions that went into those numbers, and you realize that you may have been played by those unstated assumptions, this is the sort of letter you might want to write.”
Read the full article here: https://www.bloombergquint.com/politics/trump-accounting-firm-no-longer-stands-by-financial-statements