The Financial Supervisory Authority of Norway has found that BDO breached audit law in its audit of a public-interest entity for the 2025 financial year. The firm’s risk assessment did not justify omitting procedures on the completeness of revenue at several subsidiaries, while its work on a material intangible asset did not provide sufficient appropriate audit evidence and lacked adequate professional skepticism. The subsidiaries omitted from revenue-completeness testing generated 15% of group revenue, an amount equal to about 10 times group performance materiality. For the intangible asset, the auditor did not sufficiently challenge management’s budget assumptions and impairment indicators, including repeated launch delays and information disclosed before the financial statements were issued that raised questions about the product’s commercial viability. The authority also identified a weakness in the engagement quality review because it did not flag the lack of professional skepticism.
2026-09-03Norwegian Finanstilsynet
Financial Supervisory Authority of Norway finds BDO breached audit law in public-interest entity audit
The Financial Supervisory Authority of Norway found that BDO breached audit law in its 2025 audit of a public-interest entity. Deficiencies concerned revenue-completeness testing, evidence supporting the valuation of a material intangible asset and professional skepticism, with a related weakness in the engagement quality review.