The International Federation of Accountants has pulled together some of the issues that can and do arise when companies release financial information through their Web sites. The issues are described in a discussion paper that was circulated for comment this week.
The list of issues includes:
- The need for an agreed-upon level of auditor involvement. Should management discuss and agree with the company's auditors exactly which information on the Web site will be audited?
- The need for policies covering authorization by management. At what level of the organization must information of various types, both financial and non-financial, be approved prior to posting on the Web site?
- The need to differentiate reliable financial data from non-financial, unaudited or marketing information. Should information be clearly designated as audited or unaudited? How should non-financial (but objective) information intended for use by investors be distinguished from marketing or promotional literature?
- The need for warnings on hyperlinks to third party information. Should any special disclaimers or warnings be used to ensure the user understands certain links go outside the company's Web site to sites maintained by third parties?
- The need to clarify management's responsibility for dating (and/or updating) information. What steps should management take to ensure that information posted on the company's Web site is up-to-date - or at least provides a date at which the information was last perceived to be accurate and complete?
The full paper can be downloaded for free from IFAC's Web site after a brief registration process. Jim Sylph, director to IFAC's International Auditing and Assurance Standards Board, explains, "This paper is issued to stimulate discussion regarding issues faced by enterprises that, in addition to communicating financial information through the traditional paper medium, also choose to communicate financial information on their corporate Web site." Comments may be e-mailed directly to firstname.lastname@example.org.