Audit & Accounting

The Financial Accounting Standards Board appointed Judith H. O’Dell, CPA, as chair of the standard-setter’s newly formed Private Company Financial Reporting Committee.

In an effort to foster dialogue between auditors and those who govern non-public companies - including not-for-profits and governmental entities - the Auditing Standards Board has issued a standard requiring auditors to communicate certain issues with whomever is charged with corporate governance.The board has also established a formal attestation hierarchy and fine-tuned a few existing standards.

In search of a happy medium for the smaller public companies that have loudly complained about the cost of audits of their internal controls, Securities and Exchange Commission Chairman Christopher Cox said a new auditing standard is on the way.According to published reports, Cox said that he has been in regular contact with the chairman of the Public Company Accounting Oversight Board to develop and propose the auditing standard. Right now, Cox said that the timetable would be for the SEC to hopefully approve the standard by the spring.

The 2006 elections saw the Democrats taking control of both the House and the Senate for the first time in 12 years. The shift in the House is probably the most significant.In the House, the majority party controls the agenda: what hearings are held, what legislation gets taken up by committees. The Democratic majority is a narrow one, just as the Republican majority had been a narrow one. Many of the newly elected Democrats were chosen to appeal to moderate voters, so it is far from clear that there has been a major shift in the view of House members on tax issues. Still, control of the agenda will tend to mean that Democratic proposals, rather than Republican proposals, will emerge from the House Ways and Means Committee.

I noted a few weeks ago that the "Joy of Cooking" celebrated its 75th anniversary with the publication of its ninth edition.

Home mortgage giant Fannie Mae announced that it will reduce its earnings by $6.3 billion to correct accounting problems dating back to 2001.

A new federal reports says that the National Strategy for Financial Literacy needs to contain some measures of accountability.The strategy belongs to the Financial Literacy and Education Commission, which was created by December 2003 legislation. The Government Accountability Office says that while the strategy is comprehensive in identifying the breadth of issues involved, the plan does not serve as a plan of action designed to achieve specific goals.

The Public Company Accounting Oversight Board will meet on Dec. 19 to consider exactly what changes to Sarbanes-Oxley’s internal control measures it will issue for public comment.

Robert N. Anthony, an honored member of the Harvard Business School faculty for more than 40 years and a prolific scholar, author and innovator in the field of management accounting and control, died Dec. 1 in New Hampshire.

Deloitte & Touche is the first of the Big Four to have its annual inspection posted by the Public Company Accounting Oversight Board this year.The PCAOB’s Nov. 30 report was posted to the board’s Web site late last week and cites Deloitte for failing to obtain sufficient evidence to back up decisions in a number of audits of public companies. The firm disagreed with the board's conclusions in nearly two-thirds of the audits cited, offering a rebuttal of many of the board's criticisms as part of a response letter included with the PCAOB's report