It’s been a year-and-a-half since the Securities and Exchange Commission codified requirements that companies disclose information regarding shareholder communications with directors, including whether a company has such a process, and whether the communications are screened. And though most companies have not modified the processes they originally instituted, a review of recent proxy statements shows that […]
Karr Susan Schott
Posted inFrom the Archive
Companies Stick With Black-Scholes For FASB Expensing
So far, approaches to handling the Financial Accounting Standards Board’s stock option expensing rule—known as FAS 123R—have been varied, as companies set out to determine when and how to apply the standard, as well as how to communicate where they are in the process. Though the Securities and Exchange Commission is expected to defer the […]
Posted inBoards & Shareholders
Compensation Committees Hiring Their Own Consultants
At a February 2005 conference hosted by the Investor Responsibility Research Center, Charles Elson—director of the University of Delaware’s Center for Corporate Governance—stressed the idea that boards should engage their own executive compensation consultant who does nothing but work with the board itself. In other words, the consultant doesn’t work for management. The move, seen […]
Posted inFrom the Archive
SEC: Notification Of Late Filing Demands Full Disclosure
On Feb. 14, the Securities and Exchange Commission sent a message to public companies on the need for full disclosure when filing a “Notification of Late Filing” form. The SEC brought a case against Forth Worth, Texas-based FFP Marketing Company, its former CFO, and its former controller, for poor disclosure related to the filing of […]
Posted inFrom the Archive
Guide To Proxy Advisory, Vote Recommendation Services
PROXY FIRMS Egan-Jones Proxy Services Glass Lewis Investor Responsibility Research Center Institutional Shareholder Services Proxy Governance Over the past year, Compliance Week has published numerous articles about proxy voting and its implications for public companies and institutional investors. However, public company executives know surprisingly little about the firms that are making voting recommendations to institutional […]
Posted inInternal Controls
404 Disclosure: Experts Say Get In Front Of The Issue
Get in front of it while you can. That’s the message from experts regarding the disclosures of potential adverse opinions stemming from Section 404 of The Sarbanes-Oxley Act of 2002. As we covered last week in our analysis of internal control disclosures made during the month of January 2005 (see box at right), companies are […]
Posted inAccounting & Auditing
Auditor Bandwidth Affecting Clients, Big 4, Second Six
A “perfect storm” in the accounting industry is exacerbating a shortage of auditors that has extended beyond the Big Four and is beginning to impact the next tier of accounting firms. And though small public companies are the ones hardest hit by the shortage, the impact on large enterprises may increase as they seek to […]
Posted inRegulatory Enforcement
Case Shows Detail With Which Frauds Must Be Described
Arecent lawsuit involving the California Public Employees’ Retirement System and The Chubb Corporation took an unexpected turn—one that may have implications for other public companies that become subject to civil securities fraud suits. In 2000, CalPERS was the lead plaintiff in a class action accusing Chubb of falsely reporting the success of certain business initiatives, […]
Posted inBoards & Shareholders
Swingvote Takes On Proxy Voting Account Handler ADP
Come January, Swingvote—an Atlanta-based startup—plans to go head to head with ADP Investor Communications Services in the proxy voting service marketplace. Currently, the shareholder services group at $7.4 billion ADP holds a virtual monopoly for the distribution of proxy material. The development may be important to public companies, as it will impact costs associated with […]
Posted inAccounting & Auditing
Audit Fees Are Up, But The Story May Not Be Complete
Audit fees are up, but if you consider the increase in revenues plus inflation, the fees appear not to have gone up dramatically, according to a recent study published in June 2004 by Glass Lewis, an analytical research firm. In its report, Glass Lewis concluded that “the amounts paid to auditors for the audits of […]