Auditors’ Access To BOD Minutes – A Corporate Counsel.Net Poll
The Corporate Counsel.Net recently asked readers, ” What is the common practice when an independent auditor asks a client to review their board minutes?”
I have answered the poll as I believe one of my former clients would have. Full access.
Per Broc Romanek, there have been 168 responses to the poll, including mine, thus far.
This former client, still completing several years of restatements, having made a fairly recent change in auditors, subject of internal and SEC investigations, defendant in more than a few lawsuits, and the recipient of assorted Sarbanes-Oxley material weakness and significant deficiencies, has no choice but to do whatever their new auditor asks. I believe their auditor has them by the short-hairs.
However, it looks like there are more than a few companies, more than 65% of the respondents to the poll, that believe that keeping information from their external auditors, perhaps under the guise of privilege, is ok and good policy.
Who, in heck’s name, are their auditors?
To take the poll, go to The Corporate Counsel.Net
Amazing. When I was with Deloitte Haskins & Sells, as it was then known, we could get and copy all minutes of all meetings. Anything less was a scope limitation. There was never any discussion on this point.
I’ve always had the same exact experience as Independent Accountant. You have to wonder if a lot of the people who are answering this poll don’t actually know what their companies policy is with regards to minutes.
In 3 yrs at a Big 4 Firm, I have never seen an engagement where BOD Minutes were not reviewed. In fact, YE Audits of all Companies at 12.31.07 appear to require this. SAS 114 (section 17.208) seems to definitively require as a ‘Form of Communication’ the Minutes to be reviewed/included into w/p’s. Also, ‘Independent Accountant’ would be correct (Qualified Opinion – Scope Limitation) unless the entity policy was to exclude all discussion of ‘Materially’ sensitive matters.