SEC

Improving Financial Reporting and Disclosure

The Business and Economic Review has published a thorough report on current SEC reporting requirements and the significance thereof. The article reviews the role of the SEC in financial reporting and discusses recent legislative initiatives on the part of the SEC to improve the quality of business information.Topics covered in the report include: Financial Reporting. According to recent SEC findings, corporations do not release certain types of financial information on a timely basis, nor do they report a sufficient amount of information.

SEC Calls Andersen Case 'Smoking Gun'

In a speech this week to the Center For Professional Education, Inc., acting SEC chairman, Laura Unger voiced renewed concern over auditor independence issues, citing the recent Andersen/Waste Management fracas as a prime example of abuse."This is one very significant case that we can point to," said Ms.
Community News

Andersen Fined $7 Million by SEC

The SEC filed civil charges in federal court Tuesday against Andersen, alleging the firm "knowingly or recklessly issued false and misleading" audit reports for its client, Waste Management, Inc., for the years 1993 through 1996.In a swift response to the charges, Andersen settled with the SEC and consented to be censured by the agency and to pay a fine of $7 million, the largest ever paid by a Big Five accounting firm in an SEC enforcement action.Three Andersen partners also agreed to pay a total of $

New Report May Reopen Auditor Independence Debate

An ongoing battle between the accounting profession and the SEC over the last year has led to a compromise on the question of auditor independence. But some numbers are now in which could re-open that discussion and cause the SEC to again scrutinize the line between auditing and consulting work.According to a recent article in the Washington Post, audit fees of public companies make up only about a quarter of total fees paid to an accounting firm by public companies.
Community News

SEC Accuses Former Andersen Partner of Fraud

The Sunbeam Corporation continued to cast a murky shadow over Andersen this week when the Securities and Exchange Commission sued Andersen's lead partner on the Sunbeam audit in connection with an alleged massive financial fraud. The Big Five firm has already paid out $110 million in a no-blame agreement with shareholders after a class action suit alleged fraudulent financial reporting and accounting practices under former Sunbeam management led by Al Dunlap. Now Mr.

SEC: Bloodthirsty or Just Doing its Job?

At the core of a massive plan to scrutinize up to one fourth of the nation's public companies is a continuation of the SEC's role as financial watchdog.
Community News

John Capone Leaves SEC for Andersen

The Arthur Andersen Financial Services Industry Practice has named John Capone as Partner in its North America Asset Management Practice, effective April 15, 2001. Capone is leaving his position as Chief Accountant of the Securities and Exchange Commission’s Division of Investment Management.
Community News

KPMG Must Face the Music, SEC Style

After receiving a cease and desist order from the Securities & Exchange Commission in January, KPMG filed a motion requesting the SEC to reconsider the order. Once again, the SEC has ruled in this matter, and still, KPMG is required to cease and desist.The issue behind this ruling has to do with the circumstances under which KPMG provided services to Porta Systems, a Long Island company with which KPMG had more than an auditor/client relationship.

SEC Adds 'Information For Accountants' on Updated Web Site

The U.S. Securities and Exchange Commission has significantly reorganized the SEC Web site, including a page for Information for Accountants with, among other things, a section on international accounting and auditing.

Officials Charged in Largest Accounting Fraud Ever

In a civil suit filed by the SEC in federal court Wednesday, the former chairman and vice chairman of Cendant Corporation were indicted for conspiracy and wire fraud and accused of doctoring the books of predecessor company, CUC International Inc., for the purpose of misleading shareholders. The two had resigned from the company in 1998.

Animal Farm Deal on Hold While SEC Looks at Books

Tyson Foods, the nation's largest poultry producer, is planning an acquisition of IBP Inc., the nation's largest beefpacker, as soon as the SEC lets go of IBP's financial statements.Although it might seem like a meat match made in food heaven, late last year the SEC began an investigation into some of IBP's accounting practices, including the recording of IBP's acquisition of DFG Foods, a Chicago hors d'oervre maker. The SEC is analyzing a possible $47 million charge that IBP may take relating to the sale.

FEI Exec Details Agenda for New SEC Chairman

Earlier this week, President Bush appointed Laura Unger as acting chair of the SEC. A permanent successor to departing chair, Arthur Levitt, has not yet been named.Phillip Livingston, President and CEO of Financial Executives International, has identified several key issues that are of utmost importance to financial executives.
Technology

FreeEdgar Will Cost $9.95 per Month

The free e-mail service, FreeEdgar that provides consumers with an e-mail notification of SEC filings of particular companies will begin charging a $9.95 per month fee for customers tracking over five companies. Customers can still look up information for free on the site, noted Senior Vice President Jay Sears.

Stock Exchanges Go Decimal Today

Effective today, fractions are no longer welcome on both the New York Stock Exchange and the American Stock Exchange. Both exchanges will trade all stocks in decimals, the last step in a government-mandated move that has been planned for three years. Close to 5,000 stocks were due to be switched when trading begun today. The switchover will not involve all U.S. stocks, at least not yet.

SEC Ruling Helps Investors Make Decisions

New rules approved by the Securities and Exchange Commission will require mutual funds to report their after-tax performance to investors. Traditionally, mutual fund companies have only disclosed returns before taxes.The new guidelines require mutual funds to report both before- and after-tax performance, with after-tax performance stated at the maximum individual federal income rate of 39.6 percent, thus providing a worst case scenario.

Levitt Provides Guidance to Top 5000 Audit Committees

On January 5, 2001 Securities and Exchange Commission Chairman Arthur Levitt sent the following letter to the audit committee chairmen of the top 5,000 public companies. Dear Members of the Audit Committee: Almost a year ago, the Commission, our major markets and standard setters – building on the work of the Blue Ribbon Committee on Audit Committee Effectiveness – adopted rules that strengthen the audit committee's independence, and give its members the tools and the wherewithal to fulfill their duty to the investing public.

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