FORM 10-K/A GAMCO Investors, Inc. - Gabelli

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Directors and Stockholders
GAMCO Investors, Inc. and Subsidiaries
We have audited the accompanying consolidated statements of financial condition of GAMCO Investors, Inc. and Subsidiaries (“GAMCO”) as of December 31, 2006 and 2005,
and the related consolidated statements of income, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2006. These financial
statements are the responsibility of GAMCO’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of GAMCO Investors, Inc. and Subsidiaries at
December 31, 2006 and 2005, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2006, in
conformity with U.S. generally accepted accounting principles.
As discussed in Note A “Changes in Accounting Policy” to the consolidated financial statements, in 2006 GAMCO changed its method of accounting for management fee revenue
on closed-end preferred shares and incentive allocation or fee revenue on investment partnerships. Accordingly, as discussed in Note A to the consolidated financial statements, the
2004 and 2005 consolidated financial statements have been restated. In addition, as discussed in Note A “Material Weakness” to the consolidated financial statements, the
accompanying 2005 consolidated financial statements have been restated for the accounting treatment and financial statement presentation of certain proprietary
investments. Moreover, as discussed in Note A “Restatement” to the consolidated financial statements, the accompanying 2005 and 2006 consolidated financial statements have
been restated to reflect the reversal of certain previously accrued expenses for investment partnership compensation.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of GAMCO Investors, Inc. and
Subsidiaries’ internal control over financial reporting as of December 31, 2006, based on criteria established in Internal Control—Integrated Framework issued by the Committee
of Sponsoring Organizations of the Treadway Commission and our report dated March 16, 2007 (except for Note A Restatement, as to which the date is August 8, 2007),
expressed an unqualified opinion on management’s assessment of the effectiveness of GAMCO’s internal control over financial reporting and an adverse opinion on the
effectiveness of GAMCO’s internal control over financial reporting because of material weaknesses.
New York, New York
March 16, 2007
except for Note A Restatement, as to which the date is
August 8, 2007
ERNST & YOUNG LLP
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