The fox and the henhouse…

September 20, 2004

Krispy Kreme (KKD) , the former Wall Street darling, has been under the gun lately over a series of accounting issues. The SEC is poking around and the company recently disclosed in its Q that its accounting firm, PricewaterhouseCoopers, was unwilling to sign off on its most recent financials until an internal investigation had been completed. So perhaps it’s not so surprising that in that same Q, the company disclosed that the chairman of its audit committee was now the subject of an SEC investigation unrelated to Krispy Kreme. The audit chairman, Robert McCoy Jr., was formerly the CFO for Wachovia Bank (WB) before First Union acquired the bank and adopted Wachovia’s name. Over the summer, Wachovia disclosed that the SEC was looking at stock purchases made by several current and former executives following the April 2001 merger announcement and that the SEC was likely to institute enforcement actions. However, Wachovia never named names. But in the Q filed on Sept. 10, Krispy Kreme disclosed that McCoy, who only joined the Krispy Kreme board in November 2003, was one of the people under investigation.

Leave a Reply

You must be logged in to post a comment.