Disney To Split Audit and Consulting Firms, Despite Shareholder OK
In a landmark vote that was ordered by the Securities and Exchange Commission, Disney shareholders voted to reject the proposal that would have prohibited the company from using the same firm to provide auditing and consulting services.
Shareholders voted 648.4 million against the proposal to 473.1 million for the proposal. Shareholders also voted to approve the return of PricewaterhouseCoopers as the company's auditor for fiscal 2002.
In spite of the shareholder vote giving the company the right to seek auditing and consulting services from the same firm, Disney Chairman and Chief Executive Michael Eisner announced company plans to separate audit and consulting services among outside providers. In a prepared statement, Mr. Eisner noted that the decision was made to reassure shareholders and the market in general. "We've never had a problem," Mr. Eisner told shareholders. "Nevertheless, we thought this was an appropriate thing to do."
"We've been very prudent in this area over the years, with close and active oversight by the audit committee," Mr. Eisner said. " But, in the current world, it's become more important than ever to make sure that our shareholders -- and the market as a whole -- have full confidence in our financial reports, including the integrity of the auditing process."