ADMINISTRATIVE PROCEEDING
File No. 3-20256

August 16, 2021 - The Securities and Exchange Commission announced today that Texas-based CPA Christopher E. Knauth has agreed to settle charges, instituted in April 2021, that he failed to register his firm with the Public Company Accounting Oversight Board (PCAOB) and failed to comply with PCAOB standards in his audit and reviews of a public company client's financial statements.

The SEC's order finds that Knauth falsely represented to a public company audit client that his firm was registered with the PCAOB, which resulted in violations by the public company of the reporting requirement that auditors of public companies be registered with the PCAOB. The order further finds that, although Knauth eventually filed an application for registration with the PCAOB, the PCAOB repeatedly informed Knauth that the application was incomplete, but despite this, Knauth performed the 2018 audit and three interim reviews for the public company. The SEC's order also finds that Knauth's audit and interim reviews failed to comply with multiple PCAOB Auditing Standards, including failing to properly plan the audit, failing to exercise due professional care and professional skepticism, and failing to obtain sufficient appropriate audit evidence.

The SEC's order finds that as a result of his actions, Knauth engaged in improper professional conduct, willfully aided and abetted and caused his firm's failure to register with the PCAOB, and willfully aided and abetted and caused his public company audit client's reporting violations.  Without admitting or denying the SEC's findings, Knauth has agreed to cease and desist from future violations of Section 102(a) of the Sarbanes-Oxley Act, Rule 2-02(b)(1) of Regulation S-X, and Section 13(a) of the Exchange Act and Rules 13a-1 and 13a-13 thereunder, pay a $20,000 penalty, and be denied the privilege of appearing or practicing before the Commission as an accountant.

The investigation was conducted by Jonathan Shapiro, Edward Reilly, Adrienne Adkins, and Jeffrey Anderson and supervised by Amy Friedman, Peter Rosario, and Carolyn Welshhans. The litigation was conducted by Paul Kisslinger and supervised by Stephan Schlegelmilch. The SEC appreciates the assistance of the PCAOB.