The Financial Accounting Standard Board’s decision to require stock option expensing as of June 15, 2005, may sting income statements, but it is unlikely to create huge administrative headaches, according to companies that have already taken the plunge. Circuit City Stores went from tracking the pro forma impact of options to voluntarily expensing them last […]
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Posted inInternal Controls
COSO To Address Small Business Internal Controls
A private sector group is answering the U.S. Securities & Exchange Commission’s call for help in offering guidance to smaller companies wrestling to comply with new regulatory requirements. The Committee of Sponsoring Organizations is launching a project to give smaller companies some pointers on how to achieve compliance with new laws and regulations, most notably […]
Posted inFrom the Archive
Disney Settlement Reiterates Importance Of Disclosure
On Dec. 20, the SEC announced that it had reached a settlement with Walt Disney Company for charges that Disney failed to disclose certain relationships between the company and its directors in 1999 and 2000. According to the SEC, Disney failed to disclose that the company employed three children of its directors, each of whom […]
Posted inFrom the Archive
Nortel Giveback Shows Pressures To Return Bonuses
When Nortel Networks last week reported its long-awaited restatement of results from 2001 through 2003 stemming from an accounting scandal, it also announced that 12 senior executives agreed to return about $8.6 million in bonuses awarded in 2003. “While none of these executives was found to have been directly involved in the inappropriate provisioning conduct,” […]
Posted inInternal Controls
582 Weakness, Deficiency Disclosures Made In ’04
THE FILINGS The Disclosures View The Actual Weakness, Deficiency Disclosures Made During December According to a review of regulatory filings, 56 companies disclosed material weaknesses or significant deficiencies in internal controls during the month of December 2004. During the same month in 2003, only 14 companies made such disclosures. The December data bring the total […]
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Importance Of Qualitative Factors Risk Management
Comments by Federal Reserve Board governor Susan Schmidt Bies on “recognizing the importance of qualitative factors in an effective risk management process.” Argues that risk managers should, “encourage continuous improvement in all aspects, including data integrity, legal clarity, transparent disclosures, and internal controls.”
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FASB Expensing Rule Impacting Other Equity Awards
When The Financial Accounting Standards Board last month delivered its final statement on share-based payments, most news accounts focused on the impact on stock options, which now must be expensed in the first annual reporting period beginning after June 15, 2005. Generally overlooked, however, is how the new standard—officially called Statement No. 123: Share-Based Payment—might […]
Posted inFrom the Archive
Defined-Benefit Plans Face New Attacks
Defined-benefit pension plans are encountering a new wave of assaults. In “DB” plans, an employer promises to pay a set amount to a retired employee based on a pre-determined formula, usually tied to the employee’s years of service and salary before retiring. The latest attack on defined benefit plans came last month, when the United […]
Posted inAccounting & Auditing
PCAOB Revises Budget; IAASB, AICPA Issue Standards
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 […]
Posted inBoards & Shareholders
Proxy Access Returns: AFSCME Targets AIG, Kodak
The American Federation of State, County and Municipal Employees pension plan said it will submit binding proxy access proposals at insurance giant American International Group and Eastman Kodak. McEntee “We believe that insider influence on the AIG board has prevented it from effectively monitoring its business practices and providing needed checks and balances on executive […]
