The Big 4 audit firms have lost more audit clients this year than they have gained, and second-tier firms seem to be picking them up. That churn is probably due to a variety of factors, from cost to PCAOB inspection reports to ease of working relationship, but the overall trend is clear. “It’s a big unknown,” says Joe Carcello of the University of Tennessee. “It’s hard to make any strong inferences.” More inside.
For all a company’s efforts to preach anti-corruption compliance worldwide, one ugly fact endures: Too many people in too many countries still need to pay bribes simply to survive. Ethics training has virtually nothing to do with the problem, editor Matt Kelly writes. The real challenge is how we help to nurture economic systems that aren’t built on the necessity of paying bribes. More of his thoughts inside.
That the SEC endures its share of politics is not exactly news—but the amount of politics, and the sheer partisan in-fighting at the agency? That’s rising. Split votes are more common, published dissents from commissioners more frequent. “Sometimes when I see what’s going on now, I’m sorry I ever dissented on anything,” laments Roberta Karmel, an SEC commissioner in the 1970s. Inside, a closer look at the causes of the dysfunction.
The Federal Trade Commission has finally spoken (for the first time in 100 years) about how it defines the scope of its enforcement authority for anti-competitive business practices. The bad news: Its guidance is short reading and slim on specifics. The lack of detail “may have opened the floodgates for more, not less, litigation,” says Carl Hittinger of the law firm Baker Hostetler. More inside.
One of the great challenges for U.S. compliance officers as they build global programs is the basic lack of transparency into enforcement information in other countries. Two new reports give a better scope of the problem, even if the picture revealed is not terribly encouraging. “Getting access to information is not becoming easier,” says Adam Foldes of Transparency International, author of one report. More inside on how to work through that challenge.
The push to adopt a new ISO standard for financial transactions is gaining momentum on a global scale—even as the United States continues to weigh the business case for it. “It’s important because it is seen as the standard that all new financial transactions will move to over time,” says Barry Kislingbury at consulting firm ACI Worldwide. Compliance technologists in the U.S. banking sector, however, remain unconvinced. Details inside.
The world’s second-largest economy threw the rest of the world a huge curveball this summer, with crashing stock markets and unpredictable regulatory reactions. Better corporate governance might help, but the truth about China is this: Its institutions are still weak, efforts to improve them difficult. Inside, columnists Stephen Davis and Jon Lukomnik review what has happened in China, and what still needs to happen.