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e-Book: New Risks, Strategies in the Fight Against Corruption
In this e-Book, co-sponsored by BDO and The Network, we look at increased enforcement of corruption, bribery laws and new regulations, and the associated risks for companies. In response, companies are beefing up their anti-corruption programs and looking for new strategies to ensure they are in compliance. Read here.

Latest News

Walmart Outlines Sweeping
Reform of Compliance Operation

Walmart published its "Global Compliance Program Report" on Wednesday, outlining a dramatic overhaul of its worldwide compliance operations after allegations of extensive bribery in overseas markets. Global compliance chief Jay Jorgensen sat down with Compliance Week to discuss what he's done in his first year on the job. First order of business: centralizing compliance oversight among 2.2 million workers worldwide. More inside.

FASB’s Revenue Recognition
Release Pushed to Late May

Companies waiting for the final standard on revenue recognition will have a few more weeks to wait as the Financial Accounting Standards Board now expects to release it in late May or June. The standard was expected in the first quarter of 2014, but FASB's Website now indicates that it expects to issue the standard in the second quarter of 2014, which gives the board until the end of June. More inside.

To Tweet or Not to Tweet?
The SEC Has Some New Guidance

New guidance from the Securities and Exchange Commission says that hyperlinks can be used when character counts on Twitter or other social media sites don't provide enough room for issuers to otherwise provide required disclaimers and disclosures to investors and potential investors.

McGladrey's PCAOB Inspection Shows Improvement in 2012

The Public Company Accounting Oversight Board found fault with seven of the 16 audits inspected at McGladrey in 2012, a slight improvement for the firm over the eight-of-16 failed audits in the 2011 inspection cycle. Inspectors called out only one deficiency in its audit of internal control over financial reporting, a departure from much higher instances found by inspectors at other firms.

GlaxoSmithKline Bribery Probe Expands to Jordan, Lebanon

GlaxoSmithKline has confirmed it's investigating bribery allegations at its Jordan and Lebanon operations. The global pharmaceutical giant is investigating claims into whether some of its employees bribed doctors to promote and prescribe its drugs. The company faces similar bribery probes in Poland, Iraq, and China.

MoneyGram CCO Could Face
$5M Fine for Compliance Lapses

The Treasury Department's Financial Crimes Enforcement Network notified a former chief compliance officer of MoneyGram that he could face personal fines of up to $5 million for anti-money laundering compliance failures. In November 2012, MoneyGram agreed to forfeit $100 million and enter into a deferred-prosecution agreement with the Justice Department to resolve money laundering charges. Details inside.

FASB, IASB Plan to Resume
Talks on Lease Accounting

The Financial Accounting Standards Board will resume talks this week with the International Accounting Standards Board to see if the two boards can agree on how to revise their joint standard on lease accounting. The boards plan to focus on lease modifications, contract combinations, and determining the discount rate. More details inside.

SEC Charges Audit Committee
Chairs for Turning a Blind Eye

The Securities and Exchange Commission recently delivered enforcement actions to two audit committee chairs, rare enforcement targets, accusing both of failing to act on obvious red flags of fraudulent accounting and financial reporting. The cases involve two China companies, AgFeed Industries and L&L Energy, where the SEC says audit committee chairs continued to oversee the filing of financial statements they knew were faulty. More inside.

In-Depth Coverage

Internal Audit Struggles as It Attempts to Serve Many Masters

Internal audit is under a market-driven mandate to look beyond internal controls, but it is finding it tough to determine just where to leverage its expertise and how to act as an advocate for the business, while still preserving independence to provide unvarnished assurance. "Internal audit has to be a master to all. That creates problems," says Jason Pett, U.S. internal audit services leader for PwC.

What Now for Conflict Minerals
Disclosure? Stay the Course

The timing of a recent court decision rejecting part of the SEC's rule on conflict minerals could not have been worse: Many companies were already straining to meet the June 2 deadline. With no further guidance from the SEC, as of yet, some companies are stuck on how to proceed. "People should be doing all of the same things they have been doing," says Michael Littenberg, a partner at law firm Schulte Roth & Zabel.

Rethinking the Role of Free Speech in Corporate Disclosure

A Federal court decision to invalidate an SEC disclosure requirement related to conflict minerals on the basis that it violated the First Amendment may open the door to a slew of legal challenges questioning the constitutionality of disclosure requirements. "The D.C. Circuit's opinion strikes a potentially significant blow to the securities regulation regime and the integrity of the U.S. capital markets," says Michael Siebecker, professor of law at the University of Denver's Sturm College of Law.

Beware of Bizarre and Far-
Fetched Whistleblower Claims

Most companies do an adequate job of investigating serious whistleblower claims and protecting those who make them from illegal retaliation. It is the bizarre, far-fetched claims, or claims from problematic employees and serial reporters, however, where many companies get tripped up. "That's where some companies run into legal trouble," says Heather Sager, a member of the labor and employment group at law firm Vedder Price. "They reach a conclusion before they do the investigation."

When Non-Poaching Deals
Cross the Line Into Collusion

To stifle bidding wars for top talent and to stem the tide of employee defections, some companies reach non-solicitation agreements with industry peers that prohibit them from recruiting workers already on the other company's payroll. Yet such arrangements can easily violate anti-trust laws. A class-action lawsuit against several technology companies has already netted $20 million in settlements. More details inside.

Managing Third-Party Bribery
Risk in Decentralized Companies

When Hewlett-Packard settled for $108 million to resolve charges of Foreign Corrupt Practices Act violations, the Justice Department detailed an elaborate bribery scheme that involved resellers, vendors, and shell companies. According to EY's recent global fraud survey, some 90 percent of reported FCPA cases have involved third-party intermediaries. Inside, we look at how some companies are improving their monitoring and due-diligence systems to get a handle on such risks.


The Shareholders Are Coming!

Major shareholders have long pushed for expanded communication with their portfolio companies, but now corporate directors are witnessing an intensification of that trend. Large institutions are demanding to be heard and even teaming up with activist investors to amplify their message. Inside, columnist Richard Steinberg considers what the trend means for boards and how they communicate with shareholders.

Compliance Week now has a companion group on LinkedIn, where members can network and discuss the compliance and governance news of the day. Open to all compliance professionals, free to join.

Thought Leadership

Data: The Tail That Wags the Stress Test
Sponsored by Trillium Software

Conflict Minerals Webcast Series
Sponsored by 3e Co., iPoint, Schulte Roth & Zabel and Source Intelligence

Compliance Week Podcasts ...

Every week we chat with leading thinkers in compliance, auditing, risk management, public policy and more. These short (10-15 minutes) interviews are free to all. Follow Compliance Week podcasts on iTunes.