Draft COSO framework defines key components of “enterprise risk management,” and provides standards to help companies assess and improve their processes and procedures.
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Posted inInternal Controls
Where Will The Cops Set The Real Limits?
Questions I sometimes ask students in risk and control assessment training workshops to illustrate the concept of residual risk tolerance include: How many of them have broken a car speed restriction law in the past three months? How many have broken a speed law more than five times over the past three months? More than […]
Posted inBoards & Shareholders
SEC Staff Report: Review of the Proxy Process Regarding the Nomination and Election of Directors
Complete text of the proxy nomination process, conducted by the staff of the SEC’s Division of Corporation Finance in July, 2003.
Posted inRegulatory Enforcement
Discrepancy Between Fraud Perceptions, Incidence
Though asset misappropriation and “cybercrimes” like denial-of-service and virus attacks are among the most prevalent economic crimes, most senior executives are apparently kept up at night by fears of financial misrepresentation, in which company accounts are altered. However, those crimes only constitute two percent of economic crimes, according to a study by Wilmer, Cutler & […]
Posted inBoards & Shareholders
Accounting Violations Linked To Acquisitions, CEO Age
According to a two-and-a-half year study conducted at the Robert H. Smith School of Business at the University of Maryland, firms that violate accounting rules are more likely than their peers to provide extravagant stock options to their CEOs, to have history of making numerous acquisitions, and to have younger CEOs. The study looked at […]
Posted inInternal Controls
Audit: SEC Has Material Weaknesses In Internal Controls
EXAMPLES OF WEAKNESSES Lacks adequate internal control to track, report “sensitive property.” Disgorgement tracking system not current; can’t be relied upon. Inadequate reconciliation, controls for disgorgement receivables. IT office not clearly authorized to enforce IS and security policies. IT office not promptly disabling accounts after users leave SEC. Financial system controls to monitor unauthorized activities […]
Posted inInternal Controls
Documentation, Legal, Seen As Biggest SOX Costs
Senior executives at U.S. multinational companies are somewhat divided over the financial impact of complying with the Sarbanes-Oxley Act of 2002. According to a recent survey by PricewaterhouseCoopers, 56 percent of surveyed executives said initial compliance with Sarbanes-Oxley was not very costly for their company, while the remainder claimed compliance was at least “somewhat” costly. […]
Posted inFrom the Archive
Section 16 Best & Worst Practices — Web Posting
Now that the SEC’s new Section 16 rules are in effect, companies must file all Forms 3, 4 and 5 electronically. The electronic filing process is pretty straightforward — the SEC has a new on-line filing system for all forms, and documents submitted by direct transmission on or before 10 p.m. EST are deemed filed […]
Posted inInternal Controls
Audit Committees Have Role in Section 404 IC Regime
As nearly everyone knows by now, one of the most significant provisions of Sarbanes-Oxley is “Management Assessment Of Internal Controls,” known to most firms as “SOX 404.” Section 404 requires that annual reports be accompanied by a statement clarifying that company management is responsible for creating and maintaining adequate internal controls, and that management has […]
Posted inTechnology
Electronic Filing and the EDGAR System: A Regulatory Overview
Below is the complete text of an outline prepared by staff members of the SEC Divisions of Corporation Finance and Investment Management to aid electronic filers. Compliance Week has also made available a downloadable PDF version of the outline, which can be found in the box in the right-hand column. Overview In early 1993, the […]
