Pension Law

In a landmark decision, the U.S. Court of Appeals ruled that participants and beneficiaries can’t sue the sponsor of an overfunded defined benefit plan, even if the plan’s trustees breached their fiduciary duties by making bad investments.The decision could be far-reaching. Forty-eight percent of...

By Joan Urdang • June 28, 2002

Jury Verdict Could Close Andersen by Aug. 31

Regulators won’t have Arthur Andersen to kick around anymore.Management at the Big Five accounting firm acknowledged that its conviction this weekend on an obstruction of justice charge would effectively end the firm’s audit practice. After a week of deliberation, a Houston jury brought back a gu...

By Stephen Taub • June 17, 2002

SEC: Signature Should Mean Something

The stakes could soon be raised substantially for chief executive and chief financial officers when they sign off on their companies’ books.The Securities and Exchange Commission on June 13 proposed rules that would hold a company’s CEO and CFO responsible for certifying the contents of their com...

By Stephen Taub • June 13, 2002

Court Rules against Disabled

The U.S. Supreme Court has given employers the leeway, under the Americans with Disabilities Act (ADA), to refuse to hire or promote disabled workers if the company concerned that the job threatens the employee’s health or safety.The High Court overturned a lower court ruling regarding a refinery...

By Stephen Taub • June 11, 2002

Rise in Nonfinancial Reports

It’s not always about the numbers.According to a survey released by Big Five accounting firm KPMG, more companies are publishing reports on their environmental, social, and sustainability performance—and an increasing number are having these reports independently verified.To be exact, 45 percent ...

By Stephen Taub • June 3, 2002

Not Insulated from Risk

A common joke among moviegoers in the 1920s was to insist that “asbestos” — the word printed in large letters on the theaters’ fireproof curtains–was Latin for “welcome.”For many companies, however, asbestos just means curtains.That’s no joke. Asbestos litigation has driven more than 50 U.S. comp...

By Tim Reason • June 3, 2002

Corporations Supersize Annual Reports

Talk about putting a new face on financials. General Electric Co.’s 2001 annual report contains no fewer than 84 pictures of people’s faces, most of them employees. IBM’s annual report has 46 — plus snapshots of 16 eclectically shod pairs of feet. “It kind of opens up the company in a way if peop...

By Tim Reason • June 1, 2002

Shareholder Activism

Nine days before Aetna’s annual meeting in April, institutional shareholders of the troubled insurance company were invited to attend or call in to an unusual conference in New York, where Providence Capital president Bert Denton urged them to elect a maverick director–handpicked by Providence–to...

By Tim Reason • June 1, 2002

Houston, We Have a Problem, Too

It almost sounds like a scene from Groundhog Day.Yesterday, management at another Houston-based energy company admitted it inflated revenues—and then saw its share price plummet on the news.Reliant Resources Inc., which provides electricity and energy services to wholesale and retail customers, a...

By Stephen Taub • May 14, 2002

Go West?

Despite rolling blackouts, annual water shortages, and the occasional 7.2 earthquake, California is, apparently, the best state to do business.The Golden State’s cities took 6 of the 10 top spots—and 10 of the 25 highest positions—in the annual Forbes/Milken Institute study of the best places to ...

By Stephen Taub • May 10, 2002

First Auditor Independence, Now Auditor Insurance

An insurance crisis is developing for the major accounting firms.Frightened by the nightmare of unlimited liability evoked by Andersen’s role as Enron’s auditor, insurers are refusing to provide coverage to other accounting firms, insists Jim Copeland, chief executive officer of Deloitte & To...

By Stephen Taub • May 10, 2002

Near the Corner of Church and State

Is Corporate America’s cozy relationship with Wall Street’s sell-side analysts about to come to an end?Possibly. As CFO.com reported in late April, New York State attorney general Eliot Spitzer’s investigation into conflicts of interest at Merrill Lynch is apparently wrapping up. Reportedly, mana...

By Stephen Taub • May 9, 2002

The Needs of the Many

What are the most critical technology needs of finance managers?Not necessarily what you’d think. In the 12th annual Top Technologies list released by the American Institute of Certified Public Accountants (AICPA), respondents rated business and financial applications as their top tech priority. ...

By Stephen Taub • May 8, 2002

Web Spinners

Last December wasn’t the most popular month for an IPO. Still, the time was right for Hong Kong-based Eco-Teck Holdings. The environmental equipment maker went public with a US$6.3 million share offering on Hong Kong’s Growth Enterprise Market on December 5 and did so successfully — thanks in par...

By Yasmin Ghahremani • May 8, 2002

Setting Standards for the Standards-Setter?

Is the Financial Accounting Standards Board’s independence in jeopardy?Congress is mulling a bill that would require FASB to meet certain conditions by the Treasury Department and Congress to continue to receive its funding, according to Reuters, citing a discussion draft. FASB, which is mostly s...

By Stephen Taub • May 2, 2002

Asbestos Litigation

A common joke among moviegoers in the 1920s was to insist that “asbestos”–the word printed in large letters on the theaters’ fireproof curtains–was Latin for “welcome.”For many companies today, however, asbestos just means curtains.That’s no joke. Asbestos litigation has driven more than 50 U.S. ...

By Tim Reason • May 1, 2002

Shakeup at the SEC Corral

The recent reassignment of a top Securities and Exchange Commission official has some SEC insiders wondering if the commission is putting a muzzle on its own members. And it seems one lawmaker may have similar questions about the abrupt transfer of former divisional chief accountant Robert Bayles...

By CFO Asia Staff • May 1, 2002

Proposed: NTSB for Corporate Crashes

The top executive at Big Five accounting firm Deloitte & Touche has called for a number of reforms to improve the capital markets and the auditing profession.“Today, we stand at a crossroads for the U.S. capital markets. As a result of events at Enron and Andersen, we have what we hope is a o...

By Stephen Taub • May 1, 2002

Crime and Punishment

Arthur Andersen LLP’s punishment will hardly matter if it is found guilty in its obstruction of justice trial, scheduled to begin this month. A guilty verdict would deny Andersen, already hemorrhaging clients, the right to audit public companies, easily the final nail in its coffin.But experts sa...

By Tim Reason • May 1, 2002

Incredible Shrinking Assets

If ever there was a company that didn’t have its numbers tied down, it’s Enron.In October, the company was forced to restate revenues by more than $600 million. That unexpected rejiggering eventually forced the once-powerful energy trader into Chapter 11. Now, in the middle of a massive restructu...

By Stephen Taub • April 23, 2002

Bad Boy Scouts: Companies Unprepared for Big Hits

Is your company prepared for a disruption to its major source of earnings? If not, you’re not alone.More than 50 percent of finance executives say their companies are not well prepared for an interruption to their businesses. And around 25 percent concede their contingency plans are not adequate....

By Stephen Taub • April 22, 2002

Companies Not Prepared for Interruptions, Say CFOs

Is your company prepared for a disruption to its major source of earnings? If not, you’re not alone.More than 50 percent of finance executives say their companies are not well prepared for an interruption to their businesses. And around 25 percent concede their contingency plans are not adequate....

By Stephen Taub • April 22, 2002

Reversal Of Fortune: Terror Risk Comes Home

More than seven months after the September attacks on U.S. soil, finance executives still fear domestic terrorism attacks.In fact, about two-thirds of chief financial officers in the U.S. believe their companies’ domestic assets are more of a target than their assets overseas, according to a rece...

By Stephen Taub • April 16, 2002

Going Belly-Up Going Down

About 200 companies will file for bankruptcy in 2002. Half of those will be in the manufacturing sector.At least those are some of the conclusions of a new study conducted by PricewaterhouseCoopers. According to the forecast, the bulk of public-company bankruptcies will come from the telecommunic...

By Stephen Taub • April 10, 2002

Enron Auditor Will Cooperate with Investigators, Say Reports

David Duncan, the former Arthur Andersen partner who was Enron Corp.’s lead auditor, has reportedly agreed to plead guilty to obstructing justice and will cooperate with the government’s investigation.By agreeing to the deal, Duncan will avoid more serious criminal liability, according to publish...

By Stephen Taub • April 9, 2002