Accounting & Auditing

The Internal Revenue Service is chasing down scores of companies and their executives who participated in a stock option tax shelter scheme to settle up their tax bills. In many cases the tax service was sold to corporate officers by audit firms attesting to the financial statements, representing just the kind of tax service that […]

One-third of the limited number of inspection reports so far published by the Public Company Accounting Oversight Board have identified deficiencies in select audit engagements. In two cases, reports note that the inspection process ultimately led to an issuer’s restatement of financials. Fewer than a dozen inspection reports completed in 2004 have been posted online […]

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 […]

Non-U.S. companies may get some relief on the deadlines and reporting redundancies for complying with new U.S. requirements, but no leniency on the requirements themselves. That’s the message from William H. Donaldson, chairman of the U.S. Securities and Exchange Commission in a recent speech at the London School of Economics and Political Science. Donaldson Donaldson […]

As Sarbanes-Oxley begins affecting corporate reporting, companies should focus not merely on the tasks and costs of compliance, but on improving finance processes to bolster investor confidence. That was the advice of Alan Beller, director of the Corporate Finance Division of the U.S. Securities & Exchange Commission, at a recent Stanford Law School symposium on […]

Analysis of “free cash dividend payouts,” which are calculated by dividing common dividends by adjusted free cash flow, and which provide “useful insight into the relationship between cash flow and dividends and a company’s ability to pay them in the future.”

The Public Company Accounting Oversight Board has revised its budget for 2005, reducing its projected expenditures by some $15.4 million by reducing its hiring projections, reducing travel and consulting fees, and delaying implementation of information technology projects. The Board had approved a budget in October assuming $152.5 million in revenue; however, nine weeks later the […]

In the past month, two companies announced they had tapped their new chief financial officers from the auditing firm with which they were doing business. At the surface, the move appears to be a violation of Securities and Exchange Commission rules regarding auditor independence. But closer inspection shows that—though the new executives were indeed employed […]

The Public Company Accounting Oversight Board begins deliberations today on whether to draft rules that would restrict accounting firms from providing their audit clients with tax services. Regulatory direction and public remarks by members of the Board and the Securities and Exchange Commission have hinted for months that accounting firms should brace themselves for the […]