Shareholder Management

In this market you wouldn’t expect companies to turn investors away, but that’s exactly what some are doing. Why? To save money, of course, says Scott T. Gallagher, senior vice president at Georgeson Shareholder, a New York shareholder-communications firm. “Public companies are looking under ever...

By Kris Frieswick • Nov. 1, 2002

SEC Implementing Sarbanes-Oxley

The Securities and Exchange Commission took another big step toward implementing provisions of the Sarbanes-Oxley Act.On Wednesday, the commission proposed a number of critical rules regarding pro forma results, off-balance-sheet entities, and executive stock-trading.The commission is seeking pub...

By Stephen Taub • Oct. 31, 2002

Mo’ Better Blues

When it comes to filing financial reports, will faster be better?The Securities and Exchange Commission seems to think so. To give investors more to go on than pro forma earnings statements at the end of a quarter, the SEC will require publicly traded companies to speed up their 10-K and 10-Q fil...

By Jennifer Caplan • Oct. 9, 2002

Oops, Lost the Insurance

The high price of directors’ and officers’ (D&O) insurance is bad enough. But there may be a bigger anxiety: Can an insurer pull a company’s existing coverage if an executive or board member makes a reporting miscue?To be sure, court-ordered D&O policy cancellations, also known as “rescis...

By David Katz • Oct. 1, 2002

New Liabilities, New Policies

As restatements go these days, it seems a pittance.What’s more, the change reported by Westaff, a temporary-staffing company with $110 million in second quarter revenues, looked like a positive one.Partly because of tax law changes in the federal economic stimulus bill enacted in March, the compa...

By David Katz • Oct. 1, 2002

Investor Relations

Regulatory reform from Congress and the stock exchanges has forced companies to undertake a raft of changes in their audit processes and corporate governance. But companies in varying states of compliance are struggling with what to communicate to Wall Street.“Clearly the landscape has changed,” ...

By Joseph McCafferty • Oct. 1, 2002

Securities Suits

Many of the new reforms look to make companies sitting ducks for more and costlier shareholders’ lawsuits. The federal statute of limitations on such cases has jumped from one year to two, and accounting fraud is now labeled a crime, which makes it uninsurable. So how can companies stem the tide ...

By Alix Stuart • Oct. 1, 2002

Legal Unease

The Sarbanes-Oxley Act of 2002 requires corporate lawyers to report evidence of misconduct to the CEO or independent directors. The new law also gives the Securities and Exchange Commission the obligation to set guidelines for company attorneys. The rules have provoked the ire of some lawyers, wh...

By Joseph McCafferty • Oct. 1, 2002

Regulation: Pitt and the Pendulum

It’s not that the Securities and Exchange Commission wasn’t working hard during the years that Enron, WorldCom, and others were allegedly submitting fictional financials. In many instances, the agency, overburdened and lacking strategy, was simply working wrong.Consider the case of Ants Software ...

By Alix Stuart • Oct. 1, 2002

Paper Jam: Xerox Reassigns Treasurer

Xerox Corp., which is facing a criminal probe of its accounting practices, on Friday reassigned its treasurer to the company’s unit in Canada.The copier company’s management said Gregory B. Tayler, a Canadian, has accepted a position at Xerox Canada, effective immediately.Chief financial officer ...

By Stephen Taub • Sept. 30, 2002

Homestore’s Ex-CFO Settles Charges

As expected, Homestore’s former CFO and two other former senior executives settled charges by the Securities and Exchange Commission and the U.S. Attorney’s office that they inflated advertising revenues in 2001.The commission Tuesday filed charges in U.S. District Court in Los Angeles against Jo...

By Stephen Taub • Sept. 27, 2002

Homestore on the Range

As expected, Homestore’s former CFO and two other former senior executives settled charges by the Securities and Exchange Commission and the U.S. Attorney’s office that they inflated advertising revenues in 2001.The commission Tuesday filed charges in U.S. District Court in Los Angeles against Jo...

By Stephen Taub • Sept. 26, 2002

Insurance

The assault on executive-compensation schemes continues. The latest victim is split-dollar life insurance arrangements. The IRS recently proposed regulations that would tax executives more heavily on the benefits of such plans, which could make them obsolete.Split-dollar life insurance, in which ...

By Alix Stuart • Sept. 1, 2002

Contingency Planning

For the past year, New York Board of Trade (NYBOT) CFO Walter Hines has been grateful for a trading floor that is less than half the size his company had 13 months ago and a 50 percent longer commute from his home. Grateful, because the exchange’s original trading floor and offices, along with al...

By Alix Stuart • Sept. 1, 2002

Legislation

Congress passed sweeping corporate reform in July, and President Bush signed the Sarbanes-Oxley Act, which contains a host of measures intended to prevent corporate fraud and restore investor confidence in financial reports. While politicians heralded the event as “historic,” corporate executives...

By Joseph McCafferty • Sept. 1, 2002

The Uncertainty of Surety

In a trial guaranteed to embarrass both sides, J.P. Morgan Chase & Co. will square off in court this December against 11 insurance companies to demand payment of almost $1 billion in commercial surety bonds. The insurers have refused to pay, claiming the gas trades they thought they were guar...

By Tim Reason • Sept. 1, 2002

Closing the Books on Arthur Andersen

When a reporter from Reuters recently called Aldo Cardoso, chief executive officer of Andersen Worldwide SC, all Cardoso had to say was, “Andersen is dead.” He refused to answer any more questions.While Andersen has been headed towards oblivion following a string of high-profile auditing scandals...

By Joseph Radigan • Aug. 30, 2002

Price of Shame? Andersen Pays $60 Million to Enron Claimants

Andersen Worldwide SC, the Swiss-based coordinating entity for Arthur Andersen’s global operations, has agreed to pay $40 million to former investors and employees of Enron Corp. and $20 million to the bankrupt energy trader’s creditors.The settlement is the first exchange of funds in $29 billion...

By Joseph Radigan • Aug. 28, 2002

Fastow: The Heat is On

By now, the heat Andrew Fastow is feeling is probably more than just the scorching temperatures that bake Houston every August.How the former Enron CFO reacts to that heat is anybody’s guess.Last week, Michael Kopper, the former managing director of Enron Global Finance, pled guilty to two counts...

By Joseph Radigan • Aug. 26, 2002

House Warming, Texas Style

The deal struck between former Enron Global Equity head Michael Kopper and the SEC is apparently providing a wealth of information to government investigators. In fact, Kopper’s cooperation will likely help the Commission and the Justice Department’s Houston-based Enron Task Force in their joint ...

By Joseph Radigan • Aug. 23, 2002

For Kopper, a Different Kind of Roll-Over

Michael Kopper, who was a close aide to former Enron CFO Andrew Fastow, pled guilty to two counts of conspiracy in U.S. District Court in Houston on Wednesday. The court documents submitted on Wednesday by the Securities and Exchange Commission and the Justice Department never cited Fastow by nam...

By Joseph Radigan • Aug. 22, 2002

Plea Kopper?

The latest reports out of Houston indicate that Michael Kopper, the former managing director of Enron Global Finance, will plead guilty to wire fraud and money-laundering charges. If true, Kopper’s plea will mark the first criminal indictment in the landmark investigation of the once-powerful ene...

By Joseph Radigan • Aug. 21, 2002

Run from Cover?

Here’s a surprise.Less than a year after the 9/11 terrorist attacks, businesses cut their liability insurance for the first time in six years. This, according to a new report by Marsh Inc.The insurance broker and risk management services firm reported that companies cut their liability insurance ...

By Stephen Taub • Aug. 2, 2002

Insurance

Blame the insurance cycle. After years of palatable increases and even some decreases, workers’ compensation costs are jumping up again. Fueled by an increase in underlying health-care costs and a higher number of claims–not to mention the impact of September 11–workers’ comp costs bumped up an a...

By Joan Urdang • Aug. 1, 2002

Shareholder Activism

CFO Bud Robertson got a rude shock in April when investors at the company’s annual meeting voted down his plan to replenish Progress Software Corp.’s stock-option pool. He now faces a dilemma about how to compensate his employees, many of whom normally receive options. “We have enough options to ...

By Tim Reason • Aug. 1, 2002