The Financial Accounting Standards Board has issued a proposed statement to rank authority in generally accepted accounting principles, but in the process is contradicting its stated intention to give professionals more room for judgment. FASB is exposing for comment a draft of its hierarchy of GAAP to rank the order of authority of accounting principles […]
Tammy Whitehouse
Posted inAccounting & Auditing
Should Investors Have An Open Line To Your Auditor?
To further enhance transparency in financial reporting, should investors have direct access to a company’s auditors? How about the engagement letter and other documents related to the audit/client relationship? Should the audit partner be required to take pen in hand and sign the audit? Is there adequate competition among audit firms, or should regulators have […]
Posted inFrom the Archive
Expensing Delay Leaves Door Open For Lobbyists, Congress
The Securities and Exchange Commission fanned the flames of controversy last week when it altered the effective date of stock option expensing to give the vast majority of public companies another six months to comply. Reactions ranged from shock and anger on the part of the investor community to relief and rejoicing on the part […]
Posted inInternal Controls
SEC, PCAOB Promise New Internal Control Guidance
The staffs of the Securities and Exchange Commission and the Public Company Accounting Oversight Board are churning new guidance on how companies can better navigate the internal control provisions of The Sarbanes-Oxley Act of 2002. That’s the promise of those agencies’ respective chairmen, made at a packed SEC roundtable event last week. The PCAOB has […]
Posted inBoards & Shareholders
Extension Of Global Settlement A “Non-Event” For Cos.
The Securities and Exchange Commission is floating rule changes proposed by New York Stock Exchange and the National Association of Securities Dealers to extend the tenets of the 2003 “global settlement” to all registered brokerage firms. The global settlement sought to resolve concerns about conflict of interest at 10 leading brokerage houses in which investment […]
Posted inInternal Controls
SEC Will Act Quickly On 404 Roundtable Findings
The Securities and Exchange Commission will take quick action on what it learns at this week’s SEC Roundtable on Implementation of Internal Control Reporting Provisions. That’s the pledge of Donald Nicolaisen, chief accountant of the SEC, in a written statement preceding the event. “Because many registrants are or soon will be evaluating their internal control […]
Posted inFrom the Archive
SEC Expensing Guidance Hits On Valuation, Disclosure
The Securities and Exchange Commission guidance on the soon-to-take-effect accounting rule requiring companies to expense stock options leaves the door wide open for companies to decide how to establish their costs, but also emphasizes the importance of good disclosure in describing their valuation methods. Turner “The key point the SEC staff guidance reiterates over and […]
Posted inInternal Controls
Rules Not Meant To Erect Wall Between Auditors, Cos.
Standard setters never meant to cut contact between auditors and their clients with the recent wave of rules establishing greater independence for auditors, nor did they intend to create excessive accounting costs for smaller companies. That’s according to Daniel Goelzer, a member of the Public Company Accounting Oversight Board, who spoke at the Washington Economic […]
Posted inAccounting & Auditing
SEC Chair To Directors: Tie Exec. Pay To Performance
While the Securities and Exchange Commission is considering ways to “modernize” disclosure rules regarding executive compensation, corporate directors need to pay closer attention to their duty to investors. That’s according to SEC chairman William Donaldson, who addressed the topic of executive pay at a directors’ forum at Duke University last week. Donaldson Donaldson said he […]
Posted inAccounting & Auditing
Cos. Accelerate Vesting To Avoid Accounting Treatment
As the effective date approaches for the controversial new accounting rule requiring companies to expense stock options, a handful of companies are accelerating vesting to get stock options off the books before they become a drain on earnings. Donaldson The Securities & Exchange Commission has been quiet on whether it would approve or disapprove of […]