With an advisory panel poised to formally propose that the Securities and Exchange Commission relax the internal controls provisions of the Sarbanes-Oxley Act for some public companies, the panel's chairman is seeing audit troubles of a company on whose board he serves dragged into the spotlight.
Recent published reports have discussed in detail the trials of Telephone and Data Systems Inc., the parent company of U.S. Cellular. Herbert Wander, the chairman of the SEC's Advisory Committee on Smaller Public Companies, has sat on the company's board for three decades, and also served for a time on the board's four-person audit committee.
TDS, which has a market value of more than $4 billion, would not be subject to any of the changes being proposed by the advisory committee, which affect only companies with less than $787 of market capitalization.
Wander, a Chicago lawyer at Katten Muchin Rosenman, was appointed to lead the advisory panel in 2004 by former SEC Chairman William Donaldson. He has told the press that TDS's accounting problems are not due to fraud, but just errors within the company's accounting system.
TDS recently announced that it had received a delisting notice from the New York Stock Exchange and would be unable to file an annual report until it restates its annual reports dating back to 2000, and with its quarterly reports dating back to 2003.The advisory panel is due to deliver the final version of its report this weekend, and the SEC will hold a roundtable discussion in May to hear from businesses and investors before making a final decision.
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