ADMINISTRATIVE PROCEEDING
File No. 3-19368

August 21, 2019 - The Securities and Exchange Commission today announced that Michael Filkoski and Scott Magnuson, two senior audit partners formerly employed by GHP Horwath P.C., an independent public accounting firm, agreed to settle charges that they engaged in improper professional conduct in connection with their audits of Agria Corporation, a multinational agricultural company. Filkoski, the engagement partner, and Magnuson, the engagement quality review partner, both deviated from standards of the Public Company Accounting Oversight Board and ignored red flags indicating that Agria's financial statements and public filings contained material misstatements.

According to the SEC's order, Filkoski and Magnuson each approved the issuance of GHP's 2012 and 2013 audit reports containing unqualified opinions when they knew or should have known that GHP's audits were not conducted in accordance with PCAOB standards. The SEC's order finds that Filkoski and Magnuson failed to perform adequate audit procedures to determine whether and how Agria had assessed the potential impairment of a significant asset and failed to address red flags indicating prior period impairment. The SEC's order finds that Filkoski and Magnuson engaged in improper professional conduct within the meaning of Exchange Act Section 4C(a)(2) and Rule 102(e)(1)(ii), and willfully aided and abetted and caused GHP to violate Rule 2-02(b) of Regulation S-X.

Without admitting or denying the findings, Filkoski and Magnuson each agreed to be suspended from appearing or practicing before the SEC as accountants, which includes not participating in the financial reporting or audits of public companies. The SEC's order permits Filkoski to apply for reinstatement after three years and permits Magnuson to apply for reinstatement after one year. Filkoski agreed to pay a penalty of $20,000, and Magnuson agreed to pay a penalty of $10,000.

The SEC's investigation was conducted by David Kagan-Kans, Michael Catoe, M. Shahriar Masud, and Kristen Dieter, and supervised by Robert I. Dodge.

For information on the related Agria Corporation matter, see Release No. 34-84763 (Dec. 10, 2018).