the reform of corporate reporting and auditing

《the reform of corporate reporting and auditing》由會員上傳分享，免費在線閱讀，更多相關(guān)內(nèi)容在教育資源-天天文庫。

1、THEREFORMOFCORPORATEREPORTINGANDAUDITINGTestimonyofBaruchLev*PhilipBardesProfessorofAccountingandFinance,SternSchoolofBusiness,NewYorkUniversity(212-998-0028;blev@stern.nyu.edu;www.baruch-lev.com).BeforetheHouseofRepresentativesCommitteeonEnergyandCommerce(February6,2002)3THEPROBLEMAUDITINGTOO

2、COZYDueto:¨AuditorsEffectivelyAppointed/PaidbyManagement¨LowRotation,ExcessiveConsulting,andJumpingShip¨Information-ChallengedAuditorReport¨AuditingStandardsPromulgatedbyIndustry(AICPA);PeerReviewOversightFINANCIALREPORTINGENFORCEMENTTOOLATE&OPAQUE¨Disclosure/AuditFailuresNotFullyandPromptlyIn

3、vestigated¨DelayedReportingofTradebyInsiders¨InvestigativeMaterialLargelyUnreleased¨LitigationSettlementsKeptSecretTOONARROWReflecting:FinancialAspectsofExecutedTransactionsMissing:¨MostNetworkingActivities¨UnexecutedObligations¨Intangible(Knowledge)Assets¨ComprehensiveDisclosureofRiskExposure

4、3THESOLUTION¨AuditorsAppointedbyshareholdersfora5-YearTerm¨Open-EndedAuditReportonKeyIssues¨ConsultingCappedat25-30%ofAuditFees¨1-YearCooling-OffPeriodforEngagementpartner¨AJointAccounting-AuditingStandardSettingComprehensiveReports,ReflectingFinancial&NonfinancialInformationConcerning:¨Execut

5、edTransactions(currentsystem)¨NetworkActivities¨UnexecutedObligations¨IntangibleAssets¨Riskstress-testsINDEPENDENTASSURANCECOMPREHENSIVEDISCLOSUREQUICK-REPSONSE,TRANSPARENTINVESTIGATIONS¨MandatoryandPromptInvestigationof“Failures”byaNewBody¨TransparencyofInvestigatoryCorrespondenceandFindings¨

6、PromptReportingofInsiderTrading3ELABORATIONSI.CorporateDisclosure:FromFinancialReportingtoComprehensiveDisclosure21stcenturybusinessenterprisesarefastchanging;involvedinacomplexnetworkofalliances,jointventures,partnershipsandotherrelatedentities;andderivetheirvalueandgrowthprimarilyfromintangi

7、bleassets(patents,brands,knowhow,uniqueorganizationaldesigns).Thetraditionalaccountingsystem,anditsmajorproduct—thepublicly-releasedfinancialreports—essentiallyreflectpasttransactions(sales,purchases,borrowing,etc.)only,andrecognizephys