Statement Summary
On May 9, 2025, the Securities and Exchange Commission (SEC) issued an order reinstating Timothy Daly, CPA, to practice before the Commission as an accountant responsible for preparing or reviewing financial statements. Daly had been previously suspended in 2020 due to misconduct involving solicitation of exam answers and obstruction during an internal investigation at KPMG LLP. Following a three-year suspension, Daly applied for reinstatement, demonstrating compliance with the terms set by the SEC.
The Commission found good cause for reinstatement, allowing Daly to return to practice, provided he has his work reviewed by an independent audit committee. His CPA license remains subject to disciplinary conditions in New York. The order underscores the Commission’s commitment to upholding integrity in the accounting profession.
Original Statement
UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
SECURITIES EXCHANGE ACT OF 1934
Release No. 103008 / May 9, 2025
ACCOUNTING AND AUDITING ENFORCEMENT
Release No. 4568/ May 9, 2025
ADMINISTRATIVE PROCEEDING
File No. 3-19803
In the Matter of
TIMOTHY DALY, CPA
ORDER GRANTING APPLICATION FOR
REINSTATEMENT TO APPEAR AND PRACTICE
BEFORE THE COMMISSION AS AN
ACCOUNTANT RESPONSIBLE FOR THE
PREPARATION OR REVIEW OF FINANCIAL
STATEMENTS REQUIRED TO BE FILED WITH
THE COMMISSION OTHER THAN AS A MEMBER
OF AN AUDIT COMMITTEE
On May 18, 2020, the Commission issued a consented Order Instituting Public Administrative Proceedings Pursuant to Sections 4C and 21C of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 102(e) of the Commission’s Rules of Practice, Making Findings and Imposing Remedial Sanctions and a Cease-and-Desist Order (the “Suspension Order”) against Respondent Timothy Daly, CPA. The Suspension Order denied Daly the privilege of appearing or practicing before the Commission as an accountant but permitted him, after three years from the date of the Suspension Order and if certain conditions were met, to request that the Commission consider his reinstatement to resume appearing or practicing before the Commission as (1) a preparer or reviewer, or a person responsible for the preparation or review of financial statements that are required to be filed with the Commission other than as a member of an audit committee, as that term is defined in Section 3(a)(58) of the Exchange Act; (2) a preparer or reviewer, or a person responsible for the preparation or review of financial statements that are required to be filed with the Commission as a member of an audit committee, as that term is defined in Section 3(a)(58) of the Exchange Act; or (3) an independent accountant.
This order is issued in response to Daly’s application for reinstatement to appear and practice before the Commission as an accountant responsible for the preparation or review of financial statements required to be filed with the Commission, other than as a member of an audit committee.
In the Suspension Order, the Commission found that Daly, while a partner at KPMG LLP, solicited and received questions and answers to an internal training examination from a colleague who served as the second partner to an audit engagement where Daly served as the lead engagement partner. After learning of KPMG’s internal investigation of its audit professionals’ cheating on internal training exams, Daly deleted text messages with his colleague in which the colleague had relayed the questions and answers to the exam, after receiving a notice from the firm requiring Daly to preserve them. Daly also made a misrepresentation to KPMG’s investigators, which he subsequently self-corrected. As a result of his conduct, Daly failed to meet standards implemented by the Public Company Accounting Oversight Board and American Institute of Certified Public Accountants requiring him to act with integrity and to refrain from committing acts discreditable to the profession.
Rule 102(e)(5) of the Commission’s Rules of Practice governs applications for reinstatement and provides that the Commission may reinstate the privilege to appear and practice before the Commission “for good cause shown,” which determination is necessarily highly fact-specific.
Daly has shown good cause for reinstatement and has met the conditions set forth in the Suspension Order to be reinstated to appear and practice before the Commission as a person responsible for the preparation or review of financial statements required to be filed with the Commission, other than as a member of an audit committee. In his capacity as a person responsible for the preparation or review of financial statements required to be filed with the Commission, other than as a member of an audit committee, Daly attests that he will have his work reviewed by the independent audit committee of any company for which he works, or in some other manner acceptable to the Commission, while practicing before the Commission in this capacity.
Daly is not, at this time, seeking to appear or practice before the Commission as a person responsible for the preparation or review of financial statements required to be filed with the Commission as a member of an audit committee or as an independent accountant. If, in the future, Daly should wish to resume appearing and practicing before the Commission in such a capacity, he will be required to submit an application to the Commission showing, among other things, that he has complied and will comply with the terms of the Suspension Order.
Daly’s license to practice as a Certified Public Accountant is currently subject to a disciplinary order issued by the New York State Education Department Office of Professional Discipline. That order would subject his license to a two year period of probation upon his return to the practice of public accountancy in the State of New York. Daly has attested that he will notify the Commission if he is found to have violated the terms of the probation.
On the basis of information supplied, representations made, and undertakings agreed to by Daly, and for the reasons stated immediately above, it appears that he has complied with the terms of the Suspension Order denying him the privilege of appearing or practicing before the Commission as an accountant. No information has come to the attention of the Commission relating to his character, integrity, professional conduct, or qualifications to practice before the Commission that would be a basis for adverse action against him pursuant to Rule 102(e) of the Commission’s Rules of Practice. As a result, Daly has shown good cause for reinstatement.
Therefore, it is accordingly,
ORDERED pursuant to Rule 102(e)(5)(i) of the Commission’s Rules of Practice that Timothy Daly, CPA is hereby reinstated to appear and practice before the Commission as an accountant responsible for the preparation or review of financial statements required to be filed with the Commission, other than as a member of an audit committee.
By the Commission.
Vanessa A. Countryman
Secretary
