Financial Reporting

DaimlerChrysler Hit with Whistleblower Suit, SEC Investigation

A whistleblower complaint has prompted a Securities and Exchange Commission investigation of DaimlerChrysler AG, over possible violations of federal anti-bribery laws, the Associated Press reported."The investigation follows the filing of a whistleblower complaint with the U.S. Department of Labor under the Sarbanes-Oxley Act by a former DaimlerChrysler employee whose employment was terminated earlier this year," the company said in its third-quarter earnings statement.

EU Proposes New Rules to Prevent Corporate Scandals

Under a new proposal by the European Union, a company's board of directors would be held collectively responsible for the numbers published in financial reports.The commission said EU member states should implement such a rule because lawyers in the Enron case, for example, had a hard time determining where to lay the blame, Dow Jones Newswires reported.Following a long string of corporate scandals in the United States, and the massive fraud discovered at the European dairy giant Parmalat, the EU has proposed a package of reforms to prevent repeats."Recent financial scandals show that
A&A

Sarbanes-Oxley Remains a Force to Be Reckoned With in the Boardroom

Two years after the introduction of the Sarbanes-Oxley Act, corporate reform continues to impact corporate directors, according to a recent study by Corporate Board Member magazine and PricewaterhouseCoopers LLP. The third annual "What Directors Think" study measures the opinions of directors and CEOs of the top 2,000 publicly traded companies.

PCAOB Adopts 2005 Budget of $152M, Proposes Subpoena Rule

Approval of 2005 Budget - The Board approved a budget of approximately $152.8 million for calendar year 2005. The budget will allow the Board to continue to fulfill its statutory mandate under the Sarbanes-Oxley Act of 2002 to oversee the auditors of public companies in order to protect the interests of investors and further the public interest in the preparation of informative, fair, and independent audit reports. The budget supports the continuation of an aggressive hiring effort in order to satisfy the PCAOB’s mandates under Title I of the Act.

Aon Accused in Insurance Scandal; Greenberg Leaves Marsh

In an uproar former Securities and Exchange Commission Chairman Arthur Levitt calls “the scandal of the decade, without a question” the furor unfolding in the insurance industry is getting uglier by the day, with New York Attorney General Eliot Spitzer claiming to have found signs of improper business practices at Aon Corp., the New York Times reported. In another development, Jeffrey W.
Tax

SEC Charges Qwest with Multi-Faceted Accounting & Financial Reporting Fraud

Qwest Agrees to Anti-Fraud Injunction, $250 Million Penalty, and Will Permanently Maintain Chief Compliance Officer Reporting to the Outside Directors of the Board. On Thursday, The Securities and Exchange Commission charged Qwest Communications International Inc., one of the largest

CA's Texas Tycoon Investor Displeased with Settlement

A major investor in Computer Associates International Inc.

Financial Professionals Question Accuracy and Timeliness of Credit Ratings

Corporate financial professionals are questioning the accuracy and timeliness of credit ratings and believe the Securities and Exchange Commission (SEC) must take a more active role in promoting competition among the credit rating agencies, according to a new survey released today by the Association for Financial Professionals (AFP).According to the survey, a third of financial professionals (34%) believe that their company's ratings are inaccurate, while only 42% believe changes in their organization's rating are made on a timely basis.
Technology

SEC Uses New Funding to Enhance Investigation Technology

The Securities and Exchange Commission is putting new cash to good use as it updates its technology to make investigations easier and more efficient.Gone are the days when boxes of documents lined
Tax

Judge Allows Class Action Against Tyco, Strikes Down Another Suit

A federal judge has allowed a shareholder class action lawsuit against Tyco International Ltd. to proceed, but he rejected a related shareholder lawsuit.According to the Wall Street Journal, U.S.

PCAOB Chairman Warns More Restatements Could be Coming

With field work due to end in December on the latest round of auditor inspections, Public Company Accounting Oversight Board Chairman William McDonough cautioned this week that more financial restatements may be coming.The PCAOB was created by the Sarbanes-Oxley Act to oversee the accounting industry and set auditing standards.Advertisement
Community News

SEC Proposes IPO Allocation Reforms

The Securities and Exchange Commission this week proposed amendments to Regulation M that would prohibit certain market activities that undermine the integrity and fairness of the offering process, particularly with respect to the allocation of Initial Public Offerings (IPOs). The amendments would also enhance the transparency of underwriters' aftermarket activities. Adopted in 1996, Regulation M governs the activities of underwriters, issuers, selling security holders, and others in connection with offerings of securities.
Community News

Corporate Boards, Sr. Executives See Shortcomings in Monitoring & Reporting

According to a new survey conducted on behalf of Deloitte Touche Tohmatsu by the Economist Intelligence Unit (EIU), only about one third (34 percent) of board members and top executives polled say their companies are proficient at monitoring critical non-financial indicators of corporate performance.The majority of board directors and senior executives surveyed for the study — called "In the Dark: What Boards and Executives Don’t Know about the Health of Their Businesses" — said that factors such as customer satisfaction, innovation, supplier relations and employee commitment are crit
A&A

FASB Delays Rule on Stock-Options Expensing

U.S. accounting rule-setters on Wednesday postponed implementation of a requirement that companies expense employee stock options.The seven-member Financial Accounting Standards Board unanimously agreed to a six-month delay in the options expensing rule — from Jan. 1, 2005 to June 15, 2005. Technology companies, along with Securities and Exchange Commission's top accountant, have promoted a delay.

Players Line Up Legal Counsel in Fannie Mae Case

As the Justice Department commences a criminal probe into accounting practices at mortgage lender Fannie Mae, the parties involved are retaining some of Washington's top attorneys.Fannie Mae confirmed the Justice Department's investigation in a Securities and Exchange Commission filing, just days after executives testified before Congress that no wrongdoing had occurred, Dow Jones Newswires reported.The U.S.

SEC’s Nicolaisen Wants FASB to Handle Stock-Option Rule

The Financial Accounting Standards Board (FASB) should stick with its plan to issue a new rule on expensing stock options by the end of the year.

SEC: Time May Run Out on Internal Controls Compliance

The Securities and Exchange Commission last week warned that there will not be 100 percent compliance with the new internal controls requirements, with many firms possibly failing to comply, Dow Jones Newswires reported.Public companies are required by the Sarbanes-Oxley Act of 2002 to assure investors that internal controls are adequate.
Tax

SEC Files Charges Against Former Employees of Peregrine for Orchestrating Massive Accounting Fraud

The Securities and Exchange Commission (SEC) this week filed civil fraud and related charges against six former senior officers of San Diego-based Peregrine Systems, Inc. who orchestrated and attempted to cover up a massive accounting fraud at the company. According to the Commission's complaint filed in the United States District Court in San Diego, the Peregrine defendants fraudulently inflated the product revenue Peregrine reported in its filings with the Commission and elsewhere.
Tax

PeopleSoft CEO Ousted for 'Situational Ethics'

The opening of a trial related to Oracle's takeover bid of PeopleSoft featured the revelation that CEO Craig Conway was fired last week for making misleading statements about PeopleSoft's sales.
Community News

Former Grant Thornton Auditors to Stand Trial in Parmalet Scandal

As a turnaround expert tries to relaunch a smaller, streamlined Parmalet Finanziaria SpA in Italy, two former Grant Thornton auditors were ordered to stand trial for false accounting and market rigging in relation to the dairy giant's collapse last year, the Associated Press reported.As part of a closed-door, fast-track legal proceeding, Maurizio Bianchi and Lorenzo Penca, who worked at Grant Thornton's former Italian office, were ordered by Judge Cesare Tacconi to stand trial. The two were arrested Dec.

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