Sound Bites From Around The Profession - Audit Reform
AccountingWEB presents our favorite funny, quirky quotes of the year to give you a good feeling for the debates and discussions that have gone on around the accounting profession in 2003 related to audit reform.
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- "Outrageous!" - Ernst & Young’s response to the SEC’s recommendation to ban the firm from new client acquisition for six months as a result of alleged independence issues with E&Y client PeopleSoft in the late 1990s. FULL STORY
- "The FASB, SEC and accountants have gone absolutely wacko on us. I'm a Stanford MBA, I went to most of my classes. I took accounting. I can't read annual reports, income statements and SEC filings any more. They are absolutely undecipherable," Sun Microsystems CEO Scot McNealy lashes out at the accounting profession in a speech in Toronto. FULL STORY
- "If it's a small [accounting firm], they slam the hell out of them. If it's a big accounting firm, it's a different equation," an SEC member tells the Washington Post in revealing the propensity of the Commission in avoiding Big Four action. FULL STORY
- "Bartering away a piece of our professional soul to gain some hoped-for public approval," a concerned William G. Paul, former American Bar Association president, lamented after the ABA passed a rule giving corporate attorneys whistleblower permission. FULL STORY
- "Another work of fantasy, concealed in lawyerly bombast, but fantasy just the same." The SEC, comparing E&Y’s version of events regarding independence issues at PeopleSoft to the Harry Potter fantasy. FULL STORY
- "We must increase our ability to detect fraud." Joseph Berardino, former head of Arthur Andersen, offering practice management guidance to the profession at an AICPA conference in November 2002. FULL STORY
- "Provide moral and ethical leadership. Bring a dose of reality to your hard-charging CEOs." Former SEC Chairman Arthur Levitt speaking to senior financial officers. He implored the audience to resist the "culture of seduction" to fudge the numbers in favor of personal gain, and to let investors really know how a company is doing, without bending to Wall Street's expectations. FULL STORY
- "Market forces are not likely to result in the expansion of the current Big Four." The conclusion of a July 2003 report by the GAO highlighting the obstacles to become a dominant player in public company auditing. FULL STORY
- "Unlimited liability on auditors is a quality driver," the European Commission stated, which killed a proposal to cap law suits against accounting firms. FULL STORY
- "Audit committees can’t audit. Only a company’s outside auditor can determine whether the earnings that a management purports to have made are suspect. Reforms that ignore this reality and that instead focus on the structure and charter of the audit committee will accomplish little." Investment guru Warren Buffett speaks out on audit reform. FULL STORY
- "For too long, the public interest voices in the accounting industry have been overwhelmed by corporate pressures." Consumer crusader Ralph Nader, in announcing the formation of his new group, the Association for Integrity in Accounting. FULL STORY