
The Public Company Accounting Oversight Board (PCAOB) has sanctioned Adeptus Partners and Howard S. Krant, a partner at the company, for breaches of rules and standards.
The disciplinary order addresses inadequate supervision and review of engagement teams during the audits of Blockchain of Things and Applied UV.
Adeptus Partners has also been penalised for not adhering to PCAOB quality control standards.
PCAOB chair Erica Williams said: “Substandard audit work and inadequate quality control put investors at risk.
“When violations like these occur, the PCAOB will take enforcement actions to hold auditors and firms accountable.”
The specific violations by Krant include insufficient oversight of the engagement teams for the 2020 audits of Blockchain of Things and Applied UV, as well as a failure to review workpapers or secure computer access to them.

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By GlobalDataAdditionally, Krant did not properly assess the team’s work on deferred revenue during the Blockchain of Things, Inc. 2021 audit to ensure adequate audit evidence was obtained.
The PCAOB found that Adeptus Partners’ quality control system failed to ensure that issuer audits were performed in compliance with professional standards and regulatory requirements.
Krant and the company, without admitting or denying the findings, have consented to the PCAOB’s order.
The order censures both parties, imposes a $75,000 civil money penalty on the company, and a $50,000 penalty on Krant.
It also suspends Krant from associating with any registered public accounting company for one year and expects Adeptus Partners to hire an independent consultant to review and recommend improvements to its quality control system.
The investigation was conducted by PCAOB enforcement staff members Stefan Hagerup, Christina Carroll and Nick Gradone, with assistance from K Lynn Dunston and supervised by Kyra Armstrong, William Ryan and John Abell.
The PCAOB is responsible for ensuring auditors’ compliance with the Sarbanes-Oxley Act, auditing-related securities laws, professional standards, and PCAOB and SEC rules.
Last month, the PCAOB announced sanctions against James Pai CPA and its owner Yu-Ching James Pai for similar violations during audits of an issuer client.
James Pai CPA faced reprimands for not meeting quality control standards, with Yu-Ching James Pai contributing to these violations.