November 30, 2006
SEC Commissioner Campos Fights Back on "SOX Attacks"
In this blog we have repeatedly fought back against those who oppose SOX just because they think it is costing them money. The "facts" they cite are usually self serving and just plain wrong.
As Commissioner Campos correctly states: The rest of the world is more competitive.
In US markets, you can raise more money in many cases. The value of your share price is likely to trade at a premium but it is more expensive to raise money on US markets.
Wall Street needs to look at fees and practices to see where the erosion of US competiveness began. This trend began long before SOX.
Let's face facts: When you charge high prices for your products or services, you leave the other guy lots of room to compete. Wall Street's fees and practices have left a lot of room for other markets to compete and make money.
Here is a an excerpt from an article from Investment News on the details of some facts to consider from SEC Commissioner Campos setting the record straight.
"Campos: Don't blame SOX for IPO woes
By Sara Hansard
December 1, 2006
Securities and Exchange Commission member Roel Campos today defended the extensive accounting regulations of the Sarbanes-Oxley Act of 2002 against criticism that they are harming U.S. competitiveness.Disputing the findings of a report to the White House released yesterday (InvestmentNews, Nov. 30) , Mr. Campos told the Consumer Federation of American annual financial services conference in Washington that the U.S. is losing business such as initial public offerings to foreign markets primarily because of increased competitiveness of foreign markets.
He said the U.S. began losing IPO business to foreign markets, such as the London Stock Exchange, as long ago as 1996, six years before Sarbanes-Oxley was enacted in response to U.S. corporate scandals. "You can't blame Sarbanes-Oxley for that," Mr. Campos said. "It's a trend, a world trend."
Further, he said that, in absolute dollar terms, the money raised by IPOs in the U.S. and elsewhere has been on the rise since 2004.Mr. Campos also said there are problems with lighter regulation in foreign markets that the U.S. would not want.
He cited several examples of Russian companies offered on the London Stock Exchange that offered few investor protections for minority shareholders...
He acknowledged that litigation is a problem in the U.S., suggesting the litigation reform be tied to expanding shareholder rights.Shareholder rights need to be enhanced if shareholders are given less ability to take companies to court for securities law matters, Mr. Campos suggested.
The SEC is in the process of discussing what to do about shareholder access to company proxy ballots for director votes. Without expanded shareholder rights "there is only room for litigation," he said.Mr. Campos suggested a system under which shareholders holding at least 5% of a company's shares would have the right to include their own director nominations on company ballots."
If your company is listed on US or Canadian exchanges and needs to comply with the requirements of Sarbanes-Oxley Section 404 and/or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies headquartered in Canada and listed on Canadian or US exchanges, go the website of our exclusive Canadian distributor, Thomson Carswell, http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
As Commissioner Campos correctly states: The rest of the world is more competitive.
In US markets, you can raise more money in many cases. The value of your share price is likely to trade at a premium but it is more expensive to raise money on US markets.
Wall Street needs to look at fees and practices to see where the erosion of US competiveness began. This trend began long before SOX.
Let's face facts: When you charge high prices for your products or services, you leave the other guy lots of room to compete. Wall Street's fees and practices have left a lot of room for other markets to compete and make money.
Here is a an excerpt from an article from Investment News on the details of some facts to consider from SEC Commissioner Campos setting the record straight.
"Campos: Don't blame SOX for IPO woes
By Sara Hansard
December 1, 2006
Securities and Exchange Commission member Roel Campos today defended the extensive accounting regulations of the Sarbanes-Oxley Act of 2002 against criticism that they are harming U.S. competitiveness.Disputing the findings of a report to the White House released yesterday (InvestmentNews, Nov. 30) , Mr. Campos told the Consumer Federation of American annual financial services conference in Washington that the U.S. is losing business such as initial public offerings to foreign markets primarily because of increased competitiveness of foreign markets.
He said the U.S. began losing IPO business to foreign markets, such as the London Stock Exchange, as long ago as 1996, six years before Sarbanes-Oxley was enacted in response to U.S. corporate scandals. "You can't blame Sarbanes-Oxley for that," Mr. Campos said. "It's a trend, a world trend."
Further, he said that, in absolute dollar terms, the money raised by IPOs in the U.S. and elsewhere has been on the rise since 2004.Mr. Campos also said there are problems with lighter regulation in foreign markets that the U.S. would not want.
He cited several examples of Russian companies offered on the London Stock Exchange that offered few investor protections for minority shareholders...
He acknowledged that litigation is a problem in the U.S., suggesting the litigation reform be tied to expanding shareholder rights.Shareholder rights need to be enhanced if shareholders are given less ability to take companies to court for securities law matters, Mr. Campos suggested.
The SEC is in the process of discussing what to do about shareholder access to company proxy ballots for director votes. Without expanded shareholder rights "there is only room for litigation," he said.Mr. Campos suggested a system under which shareholders holding at least 5% of a company's shares would have the right to include their own director nominations on company ballots."
If your company is listed on US or Canadian exchanges and needs to comply with the requirements of Sarbanes-Oxley Section 404 and/or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies headquartered in Canada and listed on Canadian or US exchanges, go the website of our exclusive Canadian distributor, Thomson Carswell, http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
Unearthing the Challenges of 52-109
There is certainly no shortage of challenges facing the mining industry today. Although recent media attention has focused on the unprecedented growth and resulting M&A activity in the sector, far less has been written about some of the more demanding regulatory compliance requirements.
Let’s face it. It’s not as glamorous to write about commodity price fluctuations, multi-national political risk or a burdensome environmental approval process. And there is nothing sexy about the evolving financial reporting regulations facing Canadian publicly listed mining companies.
For all that has been written about Sarbanes-Oxley (SOX) legislation in the US, the same cannot be said about the similar Canadian legislation put out by the Canadian Securities Administrators - Multilateral Instrument 52-109 (MI 52-109).
This will eventually change however, as I have noticed an increasing hunger among mining company executives to understand the regulatory risks facing their industry, particularly MI 52-109.
So, welcome to the information banquet known as MI 52-109. Consider this your appetizer.
A Taste of What’s to Come
MI 52-109 requires CEOs and CFOs of Canadian (TSX and TSX-V) listed companies (except investment funds) to provide what might be considered their ‘stamp of approval’ on their company’s financial statements. Agree with it or not, these requirements are meant to increase investor confidence and reduce the risk of future Enron-type scandals in the capital markets.
These compliance-related requirements are not only here to stay, I predict they will increasingly occupy the agendas of your company’s senior management.
Case in point: since 2004, CEO/CFO certification requirements have been expanding annually. As of June 30th 2006, CEO and CFO are now also required to certify that they have designed internal controls over financial reporting (ICFR) in the annual certificates filed with securities regulators
It’s also widely anticipated that by December 31, 2007, companies will be required to test and report on the effectiveness of those internal controls in the MD&A section of their annual report.
Yet, as we Canadians are still in the infancy stages of this new compliance regime, practical guidance in this area has been scarce. As a result, a lot of companies struggle to translate the certification requirements into a practical action plan. I suspect many senior executives are left wondering, “Have I got it right?”, or even “Have I done enough?”
For mining companies the challenges of designing and testing the effectiveness of ICFR may be exacerbated by the impact foreign operations have on financial results. Designing and evaluating financial reporting controls over your South American mining operation, for example, may present some unanticipated hurdles.
Mining companies may also need to review their financial controls in areas that require specialized expertise such as reserve valuation, mineral claims or land purchases and leases.
Three Tips on Internal Controls
Here are three basic guidelines to consider as you work through your internal controls certification project:
Map It Out. Even though MI 52-109 doesn’t specifically require it, consider using an internal controls framework to guide your ICFR work. It’s the road map that you’ll follow as you work through your project. For example, the COSO model utilizes a top down, risked-based approach for designing and managing internal controls.
Get Serious. Take the regulations seriously. Securities regulators certainly are. Nothing can send your company’s reputation spiraling south quicker than unfavorable press about your company’s financial reporting.
Be Committed. Continue developing your company’s understanding and overall competencies in the areas of internal controls. It makes good business sense and it’s becoming increasingly relevant in today’s environment.
And finally, stay tuned. You can rest assured they’ll be more to come on this topic in the future.
Let’s face it. It’s not as glamorous to write about commodity price fluctuations, multi-national political risk or a burdensome environmental approval process. And there is nothing sexy about the evolving financial reporting regulations facing Canadian publicly listed mining companies.
For all that has been written about Sarbanes-Oxley (SOX) legislation in the US, the same cannot be said about the similar Canadian legislation put out by the Canadian Securities Administrators - Multilateral Instrument 52-109 (MI 52-109).
This will eventually change however, as I have noticed an increasing hunger among mining company executives to understand the regulatory risks facing their industry, particularly MI 52-109.
So, welcome to the information banquet known as MI 52-109. Consider this your appetizer.
A Taste of What’s to Come
MI 52-109 requires CEOs and CFOs of Canadian (TSX and TSX-V) listed companies (except investment funds) to provide what might be considered their ‘stamp of approval’ on their company’s financial statements. Agree with it or not, these requirements are meant to increase investor confidence and reduce the risk of future Enron-type scandals in the capital markets.
These compliance-related requirements are not only here to stay, I predict they will increasingly occupy the agendas of your company’s senior management.
Case in point: since 2004, CEO/CFO certification requirements have been expanding annually. As of June 30th 2006, CEO and CFO are now also required to certify that they have designed internal controls over financial reporting (ICFR) in the annual certificates filed with securities regulators
It’s also widely anticipated that by December 31, 2007, companies will be required to test and report on the effectiveness of those internal controls in the MD&A section of their annual report.
Yet, as we Canadians are still in the infancy stages of this new compliance regime, practical guidance in this area has been scarce. As a result, a lot of companies struggle to translate the certification requirements into a practical action plan. I suspect many senior executives are left wondering, “Have I got it right?”, or even “Have I done enough?”
For mining companies the challenges of designing and testing the effectiveness of ICFR may be exacerbated by the impact foreign operations have on financial results. Designing and evaluating financial reporting controls over your South American mining operation, for example, may present some unanticipated hurdles.
Mining companies may also need to review their financial controls in areas that require specialized expertise such as reserve valuation, mineral claims or land purchases and leases.
Three Tips on Internal Controls
Here are three basic guidelines to consider as you work through your internal controls certification project:
Map It Out. Even though MI 52-109 doesn’t specifically require it, consider using an internal controls framework to guide your ICFR work. It’s the road map that you’ll follow as you work through your project. For example, the COSO model utilizes a top down, risked-based approach for designing and managing internal controls.
Get Serious. Take the regulations seriously. Securities regulators certainly are. Nothing can send your company’s reputation spiraling south quicker than unfavorable press about your company’s financial reporting.
Be Committed. Continue developing your company’s understanding and overall competencies in the areas of internal controls. It makes good business sense and it’s becoming increasingly relevant in today’s environment.
And finally, stay tuned. You can rest assured they’ll be more to come on this topic in the future.
November 28, 2006
Spitzer Shines a Bright Light on the Truth!
This blog has been consistently shining a bright light on the facts concerning Sarbanes-Oxley, IPO's and appropriate regulations.
Interestingly enough, Elliot Spitzer came out yesterday and backed the truth around regulation, corruption and Sarbanes-Oxley.
An excerpt from the Financial Times, is here:
"Eliot Spitzer, New York’s governor-elect, has hit out at efforts by figures in the Bush administration and business to roll back corporate accountability reforms imposed in the wake of financial scandals such as Enron.
In an interview with the Financial Times, the outgoing state attorney-general, who won fame for tackling corruption in the financial services industry, said diluting such reforms would be “counterproductive” and would fail to tackle the reasons US businesses are falling behind.
“The argument that we are failing in competitiveness because of regulations is incomplete,” Mr Spitzer said. “We’re failing in competitiveness because of failed business models and the lack of smart investment in technology. General Motors is not failing because of regulations but because it hasn’t produced good products....“The lesson of competitiveness is critical but let’s not forget the lessons of integrity,” he said. "
So here is a top-notch attorney who is not really likeable but definitely has guts to pursue the toughest people with real money behind them.
He speaks the truth! There is no turning back. The covers have been pulled back and what is underneath is not too attractive. Transparency is the right way to go. The investing public deserves it.
Hey Elliott, are you running for Prez in '08 already?
If your company is listed on US or Canadian exchanges and needs to comply with the requirements of Sarbanes-Oxley Section 404 and/or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies headquartered in Canada and listed on Canadian or US exchanges, go the website of our exclusive Canadian distributor, Thomson Carswell, http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
Interestingly enough, Elliot Spitzer came out yesterday and backed the truth around regulation, corruption and Sarbanes-Oxley.
An excerpt from the Financial Times, is here:
"Eliot Spitzer, New York’s governor-elect, has hit out at efforts by figures in the Bush administration and business to roll back corporate accountability reforms imposed in the wake of financial scandals such as Enron.
In an interview with the Financial Times, the outgoing state attorney-general, who won fame for tackling corruption in the financial services industry, said diluting such reforms would be “counterproductive” and would fail to tackle the reasons US businesses are falling behind.
“The argument that we are failing in competitiveness because of regulations is incomplete,” Mr Spitzer said. “We’re failing in competitiveness because of failed business models and the lack of smart investment in technology. General Motors is not failing because of regulations but because it hasn’t produced good products....“The lesson of competitiveness is critical but let’s not forget the lessons of integrity,” he said. "
So here is a top-notch attorney who is not really likeable but definitely has guts to pursue the toughest people with real money behind them.
He speaks the truth! There is no turning back. The covers have been pulled back and what is underneath is not too attractive. Transparency is the right way to go. The investing public deserves it.
Hey Elliott, are you running for Prez in '08 already?
If your company is listed on US or Canadian exchanges and needs to comply with the requirements of Sarbanes-Oxley Section 404 and/or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies headquartered in Canada and listed on Canadian or US exchanges, go the website of our exclusive Canadian distributor, Thomson Carswell, http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
November 21, 2006
Secretary Paulson, Your Pedigree is Showing!
Mr. Paulson weeps for the cause of American Capitalism (well maybe for Wall Street Investment Bankers). This is where the venerable US Treasury Secretary Paulson is a former Goldman-Sachs Chairman.
He cries in yesterday's speech at how his buddies on Wall Street are practically impoverished these days with IPO's declining. But the facts show something different.
The IPO record for this year is close to the record of 2000 (the year is not over yet) but the fess are at an all time record. But yet Sarbanes-Oxley has really hurt his pals on Wall Street. It needs to be revised so that the children of Wall Street Bankers have shoes to wear.
Meanwhile, bonuses on Wall Street are at all time highs.
"Despite the blast of $50 billion in mergers announced Monday, the value of U.S. deals still hasn't topped the record in 2000. But don't feel bad for the Wall Street firms arranging the marriages: Their pay has already hit a record. So far this year, investment banks have earned $14.8 billion in fees for helping along the year's deals, says Thomson Financial. That tops the previous record of $14.6 billion in 2000 amid the frenzied AOL-Time Warner (TWX) era.
With five weeks left in 2006, the value of U.S. deals could still hit a record, especially if there are more days like Monday: Private equity firm Blackstone offered $20 billion for office owner Equity Office; Freeport-McMoRan offered $25.9 billion for rival metals producer Phelps Dodge; Bank of America offered $3.3 billion for Charles Schwab's U.S. Trust unit; and Russia's Evraz offered $2.3 billion for Oregon Steel Mills."
Isn't time for a little honesty on this topic, Secretary Paulson:
1. Yes the "Big Four" Accounting firms have been overzealous in their approach to SOX 404. This should be changed. They have been too busy collecting high fees.
2. But the US markets were severely compromised after the Enron scandal. Now that faith has been restored, Wall Street and many public company CEO's seem to want to break that trust. Where there is no trust, there is not market. No trading and no fees.
3. The real problem is that the US process for bringing a company public is onerous and expensive because too many lawyers, bankers and accountants have their "hands in the pockets" of their clients.
4. SOX 404 needs a new audit standard. SEC Chairman Cox is working feverishly on this with the PCAOB. Let them do their work. Cox knows Wall Street too. Let him do his work.
5. If Wall Street were really interested in US capital markets, they would trim their fees to get more business. But that is out of the question. This is all someone's else's fault.
6. AIM and Hong Kong Markets are cheaper to list stocks on. So companies will go there. Standards are lower. Companies will list there. There will be a scandal there just as there was on the much raved about Dubai Stock Exchange which lost all credibility when it was tainted by insider trading scandals.
7. In the end, other countries have become smarter and more competitive. Isn't this capitalism at work!
8. The largest IPO this year, was Chinese state owned. Is it realistic to think the Chinese are going to list on US markets and be subjected to our transparency? Look at their record on human rights and you will have your answer.
Come on Secretary Paulson:
1. Do your job! Be honest about what is really causing US markets to slip - the high costs all around. SOX costs are not the whole picture.
2. Cox and company are doing their job. Give them a break and quit posing for the cameras.
3. Above all, please do not so blatantly lobby for your old pals. It is unseemly.
4. Give it a rest. The work being done is the right work. You cannot shut Pandora's Box now. Once you give investors transparency and they prove they like it, you risk a total collapse of trust in US markets.
5. Grow up and get Global! The rest of the world has caught up to the US.
Time to innovate. That is our spirit and our secret to success.
If your company is listed on US or Canadian exchanges and needs to comply with the requirements of Sarbanes-Oxley Section 404 and/or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies headquartered in Canada and listed on Canadian or US exchanges, go the website of our exclusive Canadian distributor, Thomson Carswell, http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
He cries in yesterday's speech at how his buddies on Wall Street are practically impoverished these days with IPO's declining. But the facts show something different.
The IPO record for this year is close to the record of 2000 (the year is not over yet) but the fess are at an all time record. But yet Sarbanes-Oxley has really hurt his pals on Wall Street. It needs to be revised so that the children of Wall Street Bankers have shoes to wear.
Meanwhile, bonuses on Wall Street are at all time highs.
"Despite the blast of $50 billion in mergers announced Monday, the value of U.S. deals still hasn't topped the record in 2000. But don't feel bad for the Wall Street firms arranging the marriages: Their pay has already hit a record. So far this year, investment banks have earned $14.8 billion in fees for helping along the year's deals, says Thomson Financial. That tops the previous record of $14.6 billion in 2000 amid the frenzied AOL-Time Warner (TWX) era.
With five weeks left in 2006, the value of U.S. deals could still hit a record, especially if there are more days like Monday: Private equity firm Blackstone offered $20 billion for office owner Equity Office; Freeport-McMoRan offered $25.9 billion for rival metals producer Phelps Dodge; Bank of America offered $3.3 billion for Charles Schwab's U.S. Trust unit; and Russia's Evraz offered $2.3 billion for Oregon Steel Mills."
Isn't time for a little honesty on this topic, Secretary Paulson:
1. Yes the "Big Four" Accounting firms have been overzealous in their approach to SOX 404. This should be changed. They have been too busy collecting high fees.
2. But the US markets were severely compromised after the Enron scandal. Now that faith has been restored, Wall Street and many public company CEO's seem to want to break that trust. Where there is no trust, there is not market. No trading and no fees.
3. The real problem is that the US process for bringing a company public is onerous and expensive because too many lawyers, bankers and accountants have their "hands in the pockets" of their clients.
4. SOX 404 needs a new audit standard. SEC Chairman Cox is working feverishly on this with the PCAOB. Let them do their work. Cox knows Wall Street too. Let him do his work.
5. If Wall Street were really interested in US capital markets, they would trim their fees to get more business. But that is out of the question. This is all someone's else's fault.
6. AIM and Hong Kong Markets are cheaper to list stocks on. So companies will go there. Standards are lower. Companies will list there. There will be a scandal there just as there was on the much raved about Dubai Stock Exchange which lost all credibility when it was tainted by insider trading scandals.
7. In the end, other countries have become smarter and more competitive. Isn't this capitalism at work!
8. The largest IPO this year, was Chinese state owned. Is it realistic to think the Chinese are going to list on US markets and be subjected to our transparency? Look at their record on human rights and you will have your answer.
Come on Secretary Paulson:
1. Do your job! Be honest about what is really causing US markets to slip - the high costs all around. SOX costs are not the whole picture.
2. Cox and company are doing their job. Give them a break and quit posing for the cameras.
3. Above all, please do not so blatantly lobby for your old pals. It is unseemly.
4. Give it a rest. The work being done is the right work. You cannot shut Pandora's Box now. Once you give investors transparency and they prove they like it, you risk a total collapse of trust in US markets.
5. Grow up and get Global! The rest of the world has caught up to the US.
Time to innovate. That is our spirit and our secret to success.
If your company is listed on US or Canadian exchanges and needs to comply with the requirements of Sarbanes-Oxley Section 404 and/or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies headquartered in Canada and listed on Canadian or US exchanges, go the website of our exclusive Canadian distributor, Thomson Carswell, http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
November 17, 2006
COX Running Ahead of Recent Political Pressure on Section 404
Hold your breath! The December 13th SEC meeting on Section 404 proves to be interesting. Since the upset in both houses of congress, there has been renewed attention on Section 404. Christopher Cox is hard at work on this topic with the PCAOB.
"Christopher Cox, chairman of the U.S. Securities and Exchange Commission, on Thursday told attendees at a London international securities regulators event that upcoming modifications to the controversial Sarbanes-Oxley Act of 2002 (Sarbox) will be significant, and they’ll be meant to reduce associated costs to businesses while continuing to protect investors.... “Those changes will be aimed at ensuring that the internal-control audit is top-down, risk-based, and focused on what truly matters to the integrity of a company’s financial statements,” Cox said, according to the AP."
Smaller companies will benefit most from the upcoming changes to the Audit Standards. Cox is very impressive in his dealings with all these highly motivated forces. The SEC is doing the right thing. We have financial transparency and there is no going back.
In our work with small to mid-sized clients, we have never seen one instance where there was not improvement in process, fraud prevention etc by going through this exercise. If the SEC can get a grip on external auditors, then I think the legislation has huge benefits.
If your company is listed on US or Canadian exchanges and needs to comply with the requirements of Sarbanes-Oxley Section 404 and/or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies headquartered in Canada and listed on Canadian or US exchanges, go the website of our exclusive Canadian distributor, Thomson Carswell, http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
"Christopher Cox, chairman of the U.S. Securities and Exchange Commission, on Thursday told attendees at a London international securities regulators event that upcoming modifications to the controversial Sarbanes-Oxley Act of 2002 (Sarbox) will be significant, and they’ll be meant to reduce associated costs to businesses while continuing to protect investors.... “Those changes will be aimed at ensuring that the internal-control audit is top-down, risk-based, and focused on what truly matters to the integrity of a company’s financial statements,” Cox said, according to the AP."
Smaller companies will benefit most from the upcoming changes to the Audit Standards. Cox is very impressive in his dealings with all these highly motivated forces. The SEC is doing the right thing. We have financial transparency and there is no going back.
In our work with small to mid-sized clients, we have never seen one instance where there was not improvement in process, fraud prevention etc by going through this exercise. If the SEC can get a grip on external auditors, then I think the legislation has huge benefits.
If your company is listed on US or Canadian exchanges and needs to comply with the requirements of Sarbanes-Oxley Section 404 and/or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies headquartered in Canada and listed on Canadian or US exchanges, go the website of our exclusive Canadian distributor, Thomson Carswell, http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
November 16, 2006
Taking a Risk-Based Approach To Internal Controls
As regulatory groups in the U.S. and Canada wrestle with how best to reduce the cost of financial compliance while maintaining effectiveness, we thought we should bring you this recently published article by Cathy Connally, a leading authority on financial compliance, on a top-down, risk-based compliance approach that was published in the October 2006 edition of The Bottom Line magazine. To go to the article - click here.
Her key points to reducing the cost of Internal Control over Financial Reporting (ICFR) compliance for SOX 404, or MI 52-109, can be summarized as follows:
Step 1 - Ensure executive commitment
Step 2 - Focus on entity-level controls
Step 3 - Scoping of financial accounts on a quantitative and qualitative basis
Step 4 - Mapping of key process to relevant accounts
Step 5 - Identification of process risks and controls
These steps above put your organization on a firmer footing to undertake the follow-on activities of testing, remediation, ongoing monitoring and sustainable compliance.
If your company must achieve SOX 404 compliance, or MI 52-109, and is based in the U.S. or outside of North America, please go to www.issuescentral.com or call 1.800.410.6681 ext 112, to learn more about how the Compliance Playbook(R) family of products can dramatically reduce the cost of ICFR initiatives.
If your company is based in Canada and must achieve either SOX 404 or MI 52-109 compliance, then please visit our exclusive Canadian distributor, Thomson Carswell, at www.compliancepartner.ca to learn more about the Compliance Partner(TM) line of products.
Her key points to reducing the cost of Internal Control over Financial Reporting (ICFR) compliance for SOX 404, or MI 52-109, can be summarized as follows:
Step 1 - Ensure executive commitment
Step 2 - Focus on entity-level controls
Step 3 - Scoping of financial accounts on a quantitative and qualitative basis
Step 4 - Mapping of key process to relevant accounts
Step 5 - Identification of process risks and controls
These steps above put your organization on a firmer footing to undertake the follow-on activities of testing, remediation, ongoing monitoring and sustainable compliance.
If your company must achieve SOX 404 compliance, or MI 52-109, and is based in the U.S. or outside of North America, please go to www.issuescentral.com or call 1.800.410.6681 ext 112, to learn more about how the Compliance Playbook(R) family of products can dramatically reduce the cost of ICFR initiatives.
If your company is based in Canada and must achieve either SOX 404 or MI 52-109 compliance, then please visit our exclusive Canadian distributor, Thomson Carswell, at www.compliancepartner.ca to learn more about the Compliance Partner(TM) line of products.
November 09, 2006
Cox: S.E.C. to ease the financial compliance burden on smaller companies
S.E.C. Chairman Cox is maintaining his course with respect to improving the efficiency and reducing the cost of SOX 404 (internal control) audits.
The New York Times interview can be found here.
The Chairman is seeking to find a sensible middle ground between the advocates of "audit and spank" who want ever increasing accountability and regulation of the corporate world, and the advocates of "compliance tuck and rollback" that fear the competitiveness sky is falling.
Cox is going to need all his considerable political skills to maintain an effective and efficient compliance framework and to focus the discussion on investor confidence and efficient capital formation.
If your company is listed on US or Canadian exchanges and needs to comply with the requirements of Sarbanes-Oxley and/or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook(tm).
For companies headquartered in Canada and listed on Canadian or US exchanges, go the website of our exclusive Canadian distributor, Thomson Carswell, http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
The New York Times interview can be found here.
The Chairman is seeking to find a sensible middle ground between the advocates of "audit and spank" who want ever increasing accountability and regulation of the corporate world, and the advocates of "compliance tuck and rollback" that fear the competitiveness sky is falling.
Cox is going to need all his considerable political skills to maintain an effective and efficient compliance framework and to focus the discussion on investor confidence and efficient capital formation.
If your company is listed on US or Canadian exchanges and needs to comply with the requirements of Sarbanes-Oxley and/or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook(tm).
For companies headquartered in Canada and listed on Canadian or US exchanges, go the website of our exclusive Canadian distributor, Thomson Carswell, http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
Hold on to our Wallets Executives, Dems want more say on your pay!
With the so called "thumping" (per President George Bush) that the Republicans got in the mid term elections, the Dems are already signalling that they will be less kind and gentle to business.
An excerpt from the Miami Herald today has an interview with the incoming Chairman of the powerful House Financial Services Committee , Barney Franks. Franks says some of his first orders of business are executive compensation review.
"Among his promises: to scrutinize executive pay and work for consumers.
Frank, 66, the Massachusetts Democrat, also said he would focus on creating more affordable housing and correcting economic inequalities..."
"Frank said he expected federal regulators to ease some of the costs of complying with the 2002 Sarbanes-Oxley corporate governance law, which set tougher civil and criminal standards for public company accounting."
So it remains unclear with the new democratic majorities in the House and Senate, what will make the list for real action. SOX is currently being tackled by the SEC and PCAOB, so those actions will most likely be allowed to run their course first.
The danger with the Dems is that they have their eye on the White House for 2008, so that executive compensation may become a high priority so that the "common man" can feel that executives are not being treated better than they are. Oh my!
If only, running a public company were so easy that anyone could do it then, we could pay top executives minimum wage. But that is not the case. So look out the Dems may not be too business friendly. Senators such as Hilary Clinton have proven records, back to Bill Clinton's Arkansas days, of anti business agendas.
Stay tuned for more.
If your company is public in the US or Canada and wants to comply with Sarbanes-Oxley or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies based in Canada listed on Canadian or US exchanges, see http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
An excerpt from the Miami Herald today has an interview with the incoming Chairman of the powerful House Financial Services Committee , Barney Franks. Franks says some of his first orders of business are executive compensation review.
"Among his promises: to scrutinize executive pay and work for consumers.
Frank, 66, the Massachusetts Democrat, also said he would focus on creating more affordable housing and correcting economic inequalities..."
"Frank said he expected federal regulators to ease some of the costs of complying with the 2002 Sarbanes-Oxley corporate governance law, which set tougher civil and criminal standards for public company accounting."
So it remains unclear with the new democratic majorities in the House and Senate, what will make the list for real action. SOX is currently being tackled by the SEC and PCAOB, so those actions will most likely be allowed to run their course first.
The danger with the Dems is that they have their eye on the White House for 2008, so that executive compensation may become a high priority so that the "common man" can feel that executives are not being treated better than they are. Oh my!
If only, running a public company were so easy that anyone could do it then, we could pay top executives minimum wage. But that is not the case. So look out the Dems may not be too business friendly. Senators such as Hilary Clinton have proven records, back to Bill Clinton's Arkansas days, of anti business agendas.
Stay tuned for more.
If your company is public in the US or Canada and wants to comply with Sarbanes-Oxley or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies based in Canada listed on Canadian or US exchanges, see http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
November 08, 2006
Wow! What a Night!
It seems that the American public has spoken on Iraq and a general disgust with the political atmosphere and conduct in both houses of congress. While the rout in the House of Representatives was expected, the 50/50 situation in the Senate was a little surprising.
This will be really interesting to see how various issues proceed at this time. Do the Dems have a plan for so many issues they have taken the GOP to the woodshed over? You have to give them credit for a comprehensive campaign to get the message and vote out.
The Clinton team Carville/Begala were hard at work dispensing one message: "It is Iraq, Stupid!".
Nancy Pelosi, the new Speaker of the House promises reform. Now they may have the opportunity to get that done. But will the Dems have the capability to overcome possible presidential vetos on bills unpopular with President Bush?
How will issues such as Sarbanes-Oxley fare? The Dems say they want to route out corruption. You may want to give your head a shake before you let public companies off the hook on SOX. Restatements are at an all time high and corruption is a subject in business these days not just politics.
So before you side with whining business leaders who are making bales of money these days, you may want to look at corruption on Wall Street first. There are many reasons why companies choose to list on other markets:
1. Cost of fees
2. Low standards
3. No minimums on market cap or stock price
4. Other regulations
5. Listing on your own home market
The US has led in the past on high standards. The stats support the US markets are the best in the world with the most liquidity, market faith and uptick on value. So before you throw the baby out with the bath water, let the SEC and PCAOB do their work.
SOX is working. Filter out some of the white noise and do what is right. Do not be so anxious to win in 2008 that you sell your souls!
If your company is public in the US or Canada and wants to comply with Sarbanes-Oxley or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies based in Canada listed on Canadian or US exchanges, see http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
This will be really interesting to see how various issues proceed at this time. Do the Dems have a plan for so many issues they have taken the GOP to the woodshed over? You have to give them credit for a comprehensive campaign to get the message and vote out.
The Clinton team Carville/Begala were hard at work dispensing one message: "It is Iraq, Stupid!".
Nancy Pelosi, the new Speaker of the House promises reform. Now they may have the opportunity to get that done. But will the Dems have the capability to overcome possible presidential vetos on bills unpopular with President Bush?
How will issues such as Sarbanes-Oxley fare? The Dems say they want to route out corruption. You may want to give your head a shake before you let public companies off the hook on SOX. Restatements are at an all time high and corruption is a subject in business these days not just politics.
So before you side with whining business leaders who are making bales of money these days, you may want to look at corruption on Wall Street first. There are many reasons why companies choose to list on other markets:
1. Cost of fees
2. Low standards
3. No minimums on market cap or stock price
4. Other regulations
5. Listing on your own home market
The US has led in the past on high standards. The stats support the US markets are the best in the world with the most liquidity, market faith and uptick on value. So before you throw the baby out with the bath water, let the SEC and PCAOB do their work.
SOX is working. Filter out some of the white noise and do what is right. Do not be so anxious to win in 2008 that you sell your souls!
If your company is public in the US or Canada and wants to comply with Sarbanes-Oxley or MI 52-109 cost effectively, see http://www.issuescentral.com/ to learn more about Compliance Playbook®. For companies based in Canada listed on Canadian or US exchanges, see http://www.compliancepartner.ca/ to learn more about Compliance Partner(tm).
