Regulatory actions and programs

Intuit has introduced a light-hearted online rock-and-roll jingle generator for small businesses, featuring an Austin Powers look-alike named Tommy Silk.

Prudential Financial has settled with the Securities and Exchange Commission over charges that it engaged in improperly accounting for reinsurance agreements.

Ernst & Young has settled charges with the Securities and Exchange Commission for $2.9 million alleging a conflict of interest in its audits of three companies.

The Financial Accounting Standards Board has issued a revised exposure draft of a proposed standard on earnings per share, along with a staff position on endowments for nonprofit organizations.

The National Small Business Association has debuted a Web site intended to educate small-business owners about what it calls "the myriad harmful proposals being promoted by the IRS and Congress to raise revenue."

The Internal Revenue Service and the Treasury Department have issued a ruling to discourage companies from transferring pension plans to unrelated firms.

The Securities and Exchange Commission has issued a warning about the use of 401(k) debit cards that allow employees at some companies to borrow money from their retirement plans.

Admissions of material weaknesses in internal controls have declined in the filings of large U.S. companies in the past two years, showing the positive effects of Sarbanes-Oxley compliance, according to a newly released analysis.

The European Commission has decided to cut some of the red tape to allow audit firms from other countries, including the U.S., to operate in Europe.

One of the speakers at the New York State Society of CPAs’ ethics conference last week told a series of alarming stories about accountants who had been sued by their own clients for not doing more to warn them about their own risky financial activities.

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The Institute of Internal Auditors has published a pair of Global Technology Audit Guides discussing business continuity management and information technology audit plans.

The Securities and Exchange Commission held a roundtable discussion on the performance of International Financial Reporting Standards and U.S. generally accepted accounting principles during the subprime crisis.

When I am a loss for the subject of a column, all I have to do is go to the Internet and I quickly find something to write about. What I found is a SEC press release that states the SEC has charged a mutual fund manager with violating socially responsible investing restrictions in socially responsible mutual funds that investors were told would not contain securities issued by companies involved with producing weapons, alcohol, tobacco, or gambling products.

MAXXAM JETTISONS DELOITTE

This fourth of four columns on mythbusting is aimed at an old chestnut that has been repeated so often that virtually no one ever casts a wary eye in its direction. Here is a quote from a standard intermediate textbook (italics in the original): "Cost has an important advantage over other valuations: It is reliable."

The Securities and Exchange Commission’s Advisory Committee on Improvements to Financial Reporting has released a draft of its final report.The draft report updates a progress report released in February. Among the committee’s proposals are putting executive summaries at the beginning of annual and quarterly financial reports. The committee also wants to increase investor representation on the Financial Accounting Standards Board and the Financial Accounting Foundation. The committee proposes creating a Financial Reporting Forum to coordinate the efforts of FASB with the SEC, the Public Company Accounting Oversight Board, investors, auditors and other parties.

The fourth stage of the pending UCITS directives, which sought to introduce a complete “passport” allowing fund managers based in one European Union member state to run and trade funds in another in a pan-European format, has been temporarily tabled following outcries from Ireland and Luxembourg.The controversy surrounds Version IV of the “Undertakings for Collective Investment in Transferable Securities,” or UCITS — a set of EU directives that allow collective investment schemes to operate freely throughout the EU on the basis of a single authorization from one member state.

In a time of volatile energy prices and economic uncertainty, the Governmental Accounting Standards Board has issued a standard that should allow state and local governments to more easily use derivative financial instruments to hedge against changes in prices and interest rates.

Many aspects of business organizations today are challenged to do more with less, and the internal audit activity is no exception. As executive management and boards are increasingly recognizing the criticality of managing risks throughout their organizations, they are expecting more of their internal auditors than ever before.