Financial Reporting

AICPA Takes Stand on Sarbanes-Oxley Implementation

The American Institute of Certified Public Accountants has submitted comments to the SEC regarding the implementation of three areas of the Sarbanes-Oxley bill, including internal control, the makeup of audit committees and a code of ethics.In a press release issued this week, the AICPA states its case in the three areas:Internal Control ReportingThe AICPA has long supported a requirement that management of a public company report on the effectiveness of internal control over financial reporting.

New York City Hosts Blitz of Post-Enron Conferences

Why are out-of-towners teeming into Manhattan for the holidays this year? It could be the opportunity to do some Christmas shopping along Fifth Avenue, take in a matinee at Radio City Music Hall, or catch a Knicks game at Madison Square Garden... But, no, the hottest tickets in town this holiday season are to the many booming post-Enron conferences.The price tags of these events range from free to $2,000 per attendee. Many are held at posh hotels and clubs.
Community News

Whistleblowing: A New Perspective on an Old Issue - Free Report

"Whistleblowing: A New Perspective On An Old Issue" covers all the hot topics making headlines today by delineating what the courts are saying about whistleblowing cases, how federal and state regulations (like the new Sarbanes-Oxley Act) affect the way you deal with whistleblowing, and what practical steps you can take to make sure your company doesn't get hit with a whistleblowing dilemma.
Community News

WorldCom Reaches Settlement: 'Accounting 101' Trainers Needed

WorldCom, in the midst of the largest fraud case in U.S. history, has reached a partial settlement with the SEC that will allow it to sidestep any fines or penalties for the time being. The partial settlement includes a permanent injunction barring any other securities violations, and government oversight of the telecommunications giant.
Practice

SEC Settles First Cases Involving Fair Disclosure

The U.S. Securities and Exchange Commission announced the results of three test cases involving illegal selective disclosures of material information to analysts or institutional investors. Under Regulation Fair Disclosure (Reg FD), which took effect two years ago, companies are required to release information to the public at the same time they provide it to securities professionals.Highlights of the three test cases and their resolution:Siebel Systems paid a $250,000 fine.
A&A

FASB Tightens Accounting Rules For Loan Guarantees

The Financial Accounting Standards Board

Ex-Peregrine Official Pleads Guilty to Fraud Charges

A former assistant treasurer at Peregrine, has admitted that she and other company officials conspired to disguise the company's financial condition. Earlier this year, Peregrine filed for bankruptcy protection and filed a lawsuit against Arthur Andersen, seeking to blame Andersen for failing to detect the fraud.According to press accounts, the former treasury official said she and others, including the chief financial officer, conspired to sell false and uncollectible receivables to Wells Fargo HSBC Trade Bank to improve the company's financial results.
Tax

NSA Develops Tax Accounting Standards For Small Business

The National Society of Accountants (NSA) has prepared an exposure draft on "Tax Accounting Standards for Small Business." NSA intends for the guidelines to be used by accountants who are involved with financial statements for small businesses.NSA says the standards are based on the principles of accounting used in preparing federal income tax returns, (e.g., the Internal Revenue Code).James H.

Enron's Retirement Fund Trickery is Not Unique

In these weeks leading up to the one-year anniversary of Enron's declaration of bankruptcy, attention is focused once again on what happened and what went wrong at the energy giant. But while last year's Enron collapse grabbed all the headlines, the reality is that thousands of civil cases are reported annually where the issue at hand is alleged retirement and health plan fraud.Speaking at a conference earlier this month, Ann L.
Practice Management

Giuliani to Help Restore Investor Confidence

Former New York City Mayor Rudolph Giuliani said he is committed to help turn around WorldCom because WorldCom represents the "biggest challenge" in returning investor confidence in the capital markets. Mr. Giuliani is chairman and CEO of Giuliani Partners, a New York City consulting firm that formed a strategic alliance with Ernst & Young earlier this year.

New Report Examines Questionable Accounting Practices at United Way

Double booking of revenues, counting revenues targeted to other organizations, and booking volunteer’s time as contribution revenues are all accounting practices that are now being questioned at the United Way, according to a report by the New York Times.Brian A. Gallagher, president of the United Way of America, indicated that while some of the practices in question conform to GAAP, the post-Enron scrutiny of accounting practices require that the organization now respond to the issues in question.Many of the practices result in inflated revenues for the local member organizations.

Top 10 Mistakes in Working Capital Management

In a sluggish economy, working capital management is both a business necessity and a strategic tool.
A&A

Hit List Picked For Fast-Track FASB/IASB Convergence

The Financial Accounting Standards Board (FASB) has reached into its vast reservoir of U.S. accounting standards and drawn up a hit list of 17 topics targeted for fast track convergence with international standards. The winning topics in this lottery are not necessarily the U.S.

PCAOB Head Quits, Signaling New Ballgame for Accountants

Former FBI and CIA chief William Webster resigned as chairman of the Public Company Accounting Oversight Board (PCAOB), signaling the start of a whole new ballgame for the accounting profession. The profession is widely blamed by the media for the sequence of events leading to Mr. Webster's rushed appointment as a "moderate" chairman.

Chairman Pitt Defends Record, Gets Standing Ovation

Acting now as a lame duck chairman following his resignation last week, Securities and Exchange Commission Chairman Harvey Pitt defended his record, received a standing ovation, and offered comforting words to anyone who has ever been in a similar situation. Chairman Pitt, a brilliant securities attorney who has been characterized as "seldom wrong, never in doubt," was speaking at the annual meeting of the Securities Industry Association in Boca Raton, Florida.

SEC Chief Accountant Resigns Amidst Controversy

Securities and Exchange Commission (SEC) Chief Accountant Robert K. Herdman resigned last week effective immediately. He was criticized for his role in the controversial appointment of William Webster as the new Public Company Accounting Oversight Board (PCAOB) chairman.Mr.

Federal Reserve Board Eyes Accounting Weaknesses

Speaking at a national industry conference sponsored by the American Institute of CPAs, Federal Reserve Board Governor Susan Bies said the Fed stands ready to challenge accounting practices it sees as too aggressive, and she gave examples of areas being eyed by the Fed in an effort to help overcome today's accounting weaknesses.

SEC to Hold Hearings on Credit Rating Agencies

The U.S. Securities and Exchange Commission (SEC) will hold two full-day hearings this month on credit rating agencies. Like securities analysts, credit rating firms have come under fire in recent months for not providing sufficient warnings of the downfall of corporate giants like Enron and WorldCom.The hearings will be held on Nov. 15th and 21st at the SEC's offices. Each hearing will cover the same topics but with a different set of participants.

PCAOB Challenged, Chair Implicated in Fraud Case

The U.S. Securities and Exchange Commission (SEC) asked the agency's inspector general to review the selection process for the Public Company Accounting Oversight Board (PCAOB) following press reports that newly-appointed Chairman William Webster is implicated in a fraud case involving past corporate ties.The press reports raise questions about the extent to which the facts of the case were disclosed and appropriate inquiries made. Mr.

SEC Moves to Curb Reporting and Trading Abuses

As part of its efforts to restore confidence in the capital markets, the U.S. Securities and Exchange Commission (SEC) tentatively approved several new curbs aimed at the types of reporting and trading abuses involved in recent accounting scandals. The curbs will be formalized in releases and exposed for a 30-day comment period.

Pages