Sam Antar has often referred to Overstock.com and CEO Patrick Byrne as the gifts that keep on giving. And he sure is right! There is never a dull moment when it comes to wacky conspiracy theories and accounting woes that never end.

Last week, Overstock (NASDAQ:OSTK) announced that it wouldn’t be filing its 10-Q for the third quarter on time. The reason? Patrick Byrne had created another clever (but completely wrong) accounting treatment for another accounting error recently discovered, and the auditors wouldn’t sign off on it.

And this week, Byrne announced that those auditors were just dismissed. How dare they refuse to go along with Byrne’s accounting shenanigans???

This is hilarious. Earlier this year, Overstock fired its auditors, PricewaterhouseCoopers (PwC) and replaced them with Grant Thornton (GT). All was going well until the SEC reopened an investigation into Overstock.com’s questionable accounting practices. There was some back and forth between the SEC and Overstock, and Overstock conferred with both PwC and GT in drafting responses to the SEC. That seemed to go fine until GT decided that there was a problem with these issues:

“… n November 3, 2009 the SEC responded with a follow-up comment letter which requested additional information or clarification regarding, among other matters, a fulfillment partner overpayment (which the Company recovered and recognized $785,000 as income in 2009 as it was received), fulfillment partner under billings (which the Company recovered and recognized $580,000 as income in 2009 as it was received), overbillings by a freight carrier in 2008 (which the Company recognized $301,000 in income in 2009 when the refunds were received) and an adjustment related to redeemable shares of the Company’s common stock (which the Company reclassified $705,000 in 2009 from stockholder’s equity to redeemable common stock).”

Overtsock.com came up with a phony “gain contingency” treatment for these items, and not surprisingly, Grant Thornton disagreed with them. GT has said that the company should restate the December 31, 2008 financial statements to account for these items, rather than using the phony accounting treatment that causes Overstock to report them in 2009.

And so GT was fired by Overstock.com, and the auditors have said that no one should rely on the 3/31/09 or 6/30/09 financial statements. (Those of us who have been following the saga of Overstock.com for any length of time already knew, however, that none of the company’s financial statements can be relied upon.)

And in a move that that is almost never done…. the clowns at Overstock filed their 3rd quarter 10-Q without any auditor review. I’ll be the first to say that auditor reviews are almost worthless. They offer a very low level of assurance to a reader of the financial statements, with the assurance being “almost none.” So the fact that Overstock couldn’t get even that minimal level of approval for their financial statements is a big red flag. As Gary Weiss points out, any time a company is late with filings and doesn’t have proper auditor blessings, you’re looking at a very bad company. (After all, even Bernie Madoff was able to keep up with his SEC filings and get an auditor to bless them!)

But the story gets better as the unreviewed 10-Q was made public with a press release that included comments from nutty CEO Patrick Byrne, explaining the “quandry” they are in. Apparently PwC agrees with Overstock but isn’t the company’s auditing firm. GT doesn’t agree with Overstock, so they’re not allowed to be the company’s auditing firm.

It comes as no surprise that Grant Thornton agrees with Sam Antar’s assessment of the financial issues. That would be the same Sam Antar who has been repeatedly smeared by Overstock and its executives.

The problem here is simple: Overstock.com has repeatedly tried to use cookie jar reserves to manipulate their financial statements. The auditors said NO. And it will be interesting to see what auditing firm in their right mind would ever accept this company as a client. There’s not enough liability insurance in the world to make that a worthwhile business endeavor.