Internal Controls

This profile is the latest in a series of weekly conversations with executives at U.S. public companies who are currently involved in establishing and developing compliance programs. An index of previous conversations is available here. So your job revolves solely around Section 404—how did that happen? I’ve been with Boston Scientific for nine years. When […]

Auditors, analysts, and managers long assumed that there was a threshold of materiality, below which errors and omissions did not have to be restated. Usually, this was held to be 5 percent, although some users of financial statements preferred a lower cutoff. No longer. Taube “The tripping point for what constitutes a material event is […]

A newly released study of the costs associated with Sarbanes-Oxley compliance shows that Fortune 1000 companies have seen their auditing expenses skyrocket by more than $1.5 billion—with much of the increase attributable to SOX. The study, conducted by researchers at the University of Nebraska at Omaha, compared the 2003 auditing costs of 648 companies with […]

Racetrack operator Magna Entertainment backed the wrong horses when it chose third parties to handle its pari-mutuel betting. When two of its three totalisator service providers, Scientific Games Racing and United Tote, failed to deliver Type II SAS 70 reports despite what its 10-K called “management’s timely requests,” Magna had to report a material weakness […]

This profile is the latest in a series of weekly conversations with executives at U.S. public companies who are currently involved in establishing and developing compliance programs. An index of previous conversations is available here. You head both internal audit and governance. How did the position evolve? I’ve been with the company for eight years […]

Most accelerated filers who received failing grades from their auditors in the Section 404 filings under Sarbanes-Oxley had material year-end adjustments or had restated their financials, according to an analysis of nearly 3,000 filings by AuditAnalytics.com of Manchaug, Mass. Cheffers Of 360 material weakness opinions reviews, 192—or 53.3 percent—had material year-end or auditor-initiated adjustments. 152 […]

A review of internal control disclosures made during the month of May 2005 shows that companies are successfully remediating internal control weaknesses disclosed in prior months, while others are amending opinions from “effective” to “ineffective.” Some of the disclosures—including excerpts and the original filings—are available to subscribers in the box at right. As was the […]

The three-martini lunch might soon get audited out of existence. Thanks to The Sarbanes-Oxley Act of 2002, corporate America already feels the compliance heat in core departments such as finance and payroll. Now that same efficient attention to detail is extending to the rest of corporate operations, and a prime target is the receipt-riddled function […]

Now that the first deadline related to Section 404 of The Sarbanes-Oxley Act has come and gone, companies are focusing on quarterly disclosures of changes in internal controls over financial reporting mandated by Item 308(c) of Regulation S-K. A provision somewhat forgotten amid the chaos of 404, Item 308(c) requires companies to “[d]isclose any change […]

This profile is the latest in a series of weekly conversations with executives at U.S. public companies who are currently involved in establishing and developing compliance programs. An index of previous conversations is available here. ‘Director of corporate processes’—what’s the origin of that title? We decided when we began the Sarbanes compliance project that ‘compliance’ […]