Internal Controls

Safeguarding assets has been an important objective of all organizations for centuries. In today’s digital age however, what does safeguarding your assets really mean? Who is responsible for it? And how is “protection” actually achieved? The COSO framework for enterprise risk management recognized the importance of safeguarding assets as an implicit component of effective internal […]

Disclosure of Section 404 Weaknesses

Corporate America has cut the number of internal control weaknesses it reports under Section 404 of the Sarbanes-Oxley Act by nearly 45 percent in the three years since SOX went into effect, a dramatic demonstration that companies are learning to tighten their financial reporting processes. Likewise, the number of adverse Section 404 opinions from external […]

My last two columns dealt with the tug of war between boards of directors and shareholders and how boards are best comprised to effectively carry out their responsibilities. Central to these issues is the relationship with the chief executive officer; specifically, how to provide the kind of oversight that enables the CEO to run the […]

Audit regulators have published some preliminary guidance on how the new Auditing Standard No. 5 can be implemented in smaller, less complex companies—the ones that must begin evaluating their internal control over financial reporting at the end of this year. The Public Company Accounting Oversight Board has floated the document for a 60-day comment period. […]

Large companies have had five years of hard-earned experience complying with Sarbanes-Oxley and its dreaded Section 404 provisions about internal controls over financial reporting. Now compliance looms for non-accelerated filers, and I’d suggest leaning on that experience as much as you can. Based on my observations and experience (as the leader of SOX compliance for […]

George Bernard Shaw had it right. When it comes to corporate executives and investors discussing corporate governance, we are, in the great Irish playwright’s phrase: “divided by a common language.” Knowing which interpretation of that phrase is relevant in what situation can mean the difference between success and failure. It can even determine the future […]

The Internal Revenue Service has extended the deadline to document compliance with its Section 409A rules on deferred compensation by a year—and companies still have lots of compliance work to get done right now anyway. As Compliance Week has previously reported, the IRS extended the deadline for making final amendments to deferred compensation plans, but […]

As public companies and audit firms prepare for a new approach to auditing internal controls over financial reporting, a certain trepidation hangs over the process. Regulators have called for a more relaxed audit, but how will the plaintiff lawyers react? The Securities and Exchange Commission and the Public Company Accounting Oversight Board codified their call […]