Sarbanes-Oxley

Community News

Oxley Unhappy with SOX; Blames PCAOB for Problems

Former Congressman Michael Oxley is unhappy with implementation of the corporate reform legislation that bears his name.In an interview with CFO.com, he was asked, “Are you happy with the way Sarbanes-Oxley has been implemented?” His answer: “Not really. The law has gotten a lot of criticism.” He noted that the vast majority of the complaints center on Section 404, which requires an audit of internal controls over financial reporting.“It was Auditing Standard No. 2, promulgated by the PCAOB (Public Company Accounting Oversight Board), that started all the problems,” he said.
A&A

SEC Seeks Small Business SOX Relief

In a move designed to benefit smaller companies, the SEC endorsed recommendations to eliminate waste and duplication with SOX compliance.The new PCAOB standard will be submitted for SEC review by early June, in time for the 2007 financial statement audits.The SEC staff will be working closely with the PCAOB to make the internal controls provisions of SOX Section 404 more efficient and cost effective.
Tax

SEC Approves Framework to Ease SOX Rules

The Securities and Exchange Commission approved a framework Wednesday for changes to rules under the Sarbanes-Oxley law that would ease requirements for companies and the auditors responsible for their records. Sarbanes-Oxley, which arose from the 2002 corporate scandal, mandates that public companies assess the strength of their internal checks and balances to guard against fraud. The vote by the five SEC commissioners was unanimous to support building more leeway into the rules, especially rules for auditors being written by the independent board that oversees the accounting industry.
Tax

U.S. Business Leaders Seek Reg. Reductions

A all-star panel of American business and government leaders pushed Tuesday for a rollback in regulations they say are necessary to keep U.S.
A&A

FEI Comments on Proposed SOX Changes

In separate letters submitted to the Securities and Exchange Commission (SEC) and the Public Company Accounting Oversight Board (PCAOB), Financial Executives International’s (FEI) Committee on Corporate Reporting (CCR) and Small Public Company Task Force (SPCTF), voiced concerns with recent changes proposed by the SEC and PCAOB to Section 404 of Sarbanes-Oxley.The letters, which come in conjunction with today’s comment deadline on proposed auditing standards and management guidance by the SEC and PCAOB, emphasize the importance of alignment between both agencies.

Bipartisan Support in New York for SOX 404 Reform

Governor Eliot Spitzer, the Democratic governor of New York who as the state’s attorney general prosecuted Wall Street firms and other companies for corporate securities fraud and earned more than $3.5 billion in penalties and settlements for the state, according to the New York Post, has joined Republican Mayor Michael Bloomberg and Democratic Senator Charles Schumer in calling for reform of the Sarbanes-Oxley Act. At a news conference in New York the three men announced support for reforms recommended in a study report released by McKinsey & Co.
Technology

New Release of SOX Compliance Software

OiWare, a leading provider of Sarbanes-Oxley (SOX) compliance and corporate governance software applications, has announced the availability of its iNTENTcheckT software application which will be offered through its business partner channels. iNTENTcheckT serves as the foundation for company-wide corporate governance through its capacity to join an organization's governance, risk and compliance operations into one single software management solution and help management control its intent from the top down approach and to comply with SOX section 404a.
Community News

California Accounting Firms Merge

The Sarbanes-Oxley Act (SOX) has surely increased the workload of the accounting industry overall. The regulation leading from the Act is fueling a merger of accounting firms, the San Francisco Business Times reports.Two of the accounting firms merging are the San Francisco firm Shea Labagh Dobberstein and San Mateo firm Elwood Espina Ferrell. The San Francisco Business Times reports that the new firm will take on the San Francisco firm’s name.
Community News

Arguments Begin Thursday Over PCAOB Constitutionality

A federal judge will hear arguments Thursday in a lawsuit that attacks the Public Company Accounting Oversight Board (PCAOB) as unconstitutional.Advertisement
A&A

Restatements Rise for Companies Bypassing SOX's 404 Provision

In what may be a cautionary notice to auditors of small public companies, recent research shows that financial report restatements are increasing at small businesses that have been exempt from the onerous 404 provision of the Sarbanes-Oxley (SOX) accounting reform act, but dropping for companies that do follow 404.The number of restatements filed by public companies to correct accounting errors during the first nine months of this year versus the same period in 2005, rose 45 percent for small “micro-cap” companies, that have been exempt from 404, according to a recent report.
A&A

SEC Proposes Risk-Based Analysis of Financial Controls

The Securities and Exchange Commission (SEC) voted unanimously on Wednesday to allow public companies subject to the requirements of Sarbanes-Oxley (SOX) to evaluate the design of only those financial controls that might carry the risk of having a material impact on financial statements.
A&A

SEC and PCAOB Still Working on Sarbanes-Oxley Changes

Christopher Cox, the Securities and Exchange Commission (SEC) Chairman, said Monday that regulators were still working on revisions to its rule requiring companies to adopt internal controls and procedures for financial reporting but said he was “confident” that the result would “improve the reliability of public company financial statements and better protect investors,” the Washington Post reports. The SEC will issue its proposed revision on December 13.
Community News

PCAOB Budget Projects Staff Increase of 39

The Public Company Accounting Oversight Board (PCAOB) submitted a 2007 budget proposal of $136.4 million, which would be an increase of $5.5 million or about a half a percent over the current budget.Advertisement
Community News

BearingPoint Faces Delisting From NYSE

BearingPoint, the tech and management consulting firm forced to split off from parent KPMG by the Sarbenes-Oxley Act (SOX), could be dropped from the New York Stock Exchange (NYSE), the company’s 2005 annual report said.Advertisement
A&A

SEC, PCAOB Chairmen Differ Over SOX 404 Changes

Securities and Exchange Commission (SEC) Chairman Christopher Cox and the Public Accounting Oversight Board’s (PCAOB) Chairman Mark Olson were reported to be planning to meet, possibly as early as Sunday, to discuss differences in their approaches to revising Section 404 of the Sarbanes-Oxley Act (SOX), Reuters reports. Early in November the PCAOB sent a draft audit revision to the SEC that did not win SEC approval because it did not meet the concerns of small businesses, unnamed sources told Reuters.
Tax

Corporate America Fighting Back Against Lawsuits, Regulations

Two influential industry groups are developing proposals that would make it more difficult for investors to file civil suits against companies and accounting firms, while also strengthening protections from criminal cases brought by government prosecutors.The groups, which have close ties to the Bush administration, hope to limit the liability of accounting firms for the work they do for clients so that individuals are targeted for wrongdoing, not entire companies, the New York Times reported.One of the groups drafting proposals is the U.S.

Amendments to AS2 Aim To Rethink Auditor’s Role

The Public Company Accounting Oversight Board (PCAOB) submitted a draft of changes for its Auditing Standard 2 (AS2) to the Securities and Exchange Commission (SEC) back in September. AS2 has been criticized for its conservative use by auditors, according to CFO.com.

Skilling Sentenced; Worldcom Investors to Receive Payments

Former Enron Chief Executive Officer (CEO) Jeffrey Skilling was sentenced last Monday to 24 years and four months in prison for his role in the corporate accounting scandal that gave its name to an era. The Securities and Exchange Commission (SEC) announced that it would begin distributions to WorldCom investors from the Fair Fund. And while the Enron and WorldCom corporate accounting scandals set the stage for congressional action and passage of the Sarbanes-Oxley Act (SOX) in 2004, criminal prosecutions in these cases have not lessened the SEC’s work load.
Technology

Corporate Focus Now Meets FAS 123R Option Expensing Regulations

Two Step Software, Inc. introduced its new version of Corporate Focus at the National Association of Stock Plan Professionals’ Conference October 10-13 in Las Vegas. The new software includes option expensing to meet FAS 123R valuation regulations, Two Step said. FAS 123R rules require financial institutions to recognize in their income statement the grant-date fair value of stock options and other equity-based compensation issued to employees.The new Corporate Focus release will now be able to calculate that valuation according to FAS 123R guidelines.
Technology

More Room for Compliance & Control Automation

Approva® Corporation has surveyed 200 high-level finance, internal audit and IT executives at leading public companies and the survey results found that many companies still manually audit a large portion of their organization’s internal controls.Approva, a producer of continuous controls monitoring and audit software, announced the survey results this week.

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