CNBC’s Cramer Spits Into Wind On Clawbacks Of Fraudulent Bonuses
CNBC’s JIm Cramer went off this week on the JP Morgan Securities settlement with the SEC. In his mind, someone, everyone got off too easy. It’s a familiar lament.
Posts
One Of These Things Is Not Like The Others: How Goldman Sachs and Lehman Brothers Hid The Ball From Investors
/in Food for Thought, Goldman Sachs, Lehman BrothersWhat’s the difference between Lehman/Hudson Castle – the structured investment vehicle (SIV) mentioned in the New York Times last week – and the SEC fraud charges against Goldman? Aren’t both about disclosure?
Two Wildly Different Stories About Deloitte: Or Are They?
/12 Comments/in Latest, Pure Content, The Case Against The AuditorsIn the last few weeks, I’ve written two very different stories about Deloitte. Both stories bothered me, but in different ways, so I was compelled to write about the firm both in unsympathetic and sympathetic terms. In the end, neither story says much about the state of the audit industry and the pre-2011 regulation of the audit firms.
Being Expedient: PwC Settles Satyam U.S. Class Action
/6 Comments/in Latest, Pure Content, The Case Against The AuditorsIt was a quiet almost-end to a sordid chapter in PwC’s history. Last week I wrote about PwC’s settlement of their Satyam class action lawsuits in New York for Forbes. Here’s some additional commentary and analysis, including links to all the stories I’ve written about the scandal since it broke in January 2009.
McKenna Quoted in American Banker re: Second-Lien Mortgages
/2 Comments/in Fair Value, Regulators, Laws, Standards, Regulations, SEC, Subprime, You Can Quote Me On ThatI was quoted on May 2 in an article in American Banker by Alex Ulam entitled, “Why Second-Lien Loans Remain A Worry”. My quote focused on disclosures and transparency – for the loans and the reserves for losses. It’s a subject I’ve written about extensively.
Slippery People: Corporate Governance at Berkshire Hathaway
/9 Comments/in Food for Thought, Latest, Pure ContentStanford University Graduate School of Business Professor David Larcker and his research associate, Brian Tayan, have developed a case study on the recent David Sokol – Berkshire Hathaway corporate governance slip-up. They emphasize, “The success of this system is predicated on the expectation that Berkshire Hathaway managers operate with high levels of integrity.” I don’t think Berkshire Hathaway’s leadership defines corporate governance the way everyone thinks they do. The bigger question is: Should that matter to their investors or anyone else?
Will Auditors Be Held Accountable? The PCAOB Has A Plan
/9 Comments/in Latest, Pure Content, The Case Against The AuditorsI was in Washington DC to attend the March 24 meeting of the new Standing Advisory Committee (SAG) of the new PCAOB. I was surprised twice by a report presented by the PCAOB’s Investor Advisory Group at last week’s meeting. First surprise: Chairman Doty was right. Good people are looking at the issue of auditor effectiveness, especially during the crisis. Second surprise: The report quoted me.
@ Forbes: Chinese Reverse Mergers: The Auditor Angle
/10 Comments/in The Big 4 And GlobalizationMy Forbes column today is about the Chinese reverse merger market and recent reports of potential frauds – plural. I waited for the inevitable case that implicated a Big 4 audit firm. When it came I got two for the price of one and a bonus – a great new research paper from the PCAOB on the Chinese reverse merger phenomenon.
@Forbes “Auditors Abandon Investors On Liability Limits”
/in Audit Quality, Food for Thought, Fraud, Liability Caps, Pure ContentTammy Whitehouse over at Compliance Week does a thorough job on the largest audit firms and their fear of catastophic litigation. Yes, they’re admitting it – Tammy says they’re pleading with legislators – and fighting any legislative urges to open more avenues for lawyers and their clients to sue them. The Dodd-Frank Act gave the Securities […]
@Forbes “Charlie Sheen And Public Company Disclosure”
/in Follow Me On Twitter, Food for ThoughtYou may think I’m stretching, but this post has garnered quite a few hits and several comments on Twitter, including from my Forbes boss, Dan Bigman, the Executive Editor for Business News. Is Charlie Sheen big enough to have a material effect on either CBS Corporation (CBS) or TimeWarner, Inc financial results? Warner Brothers (WB), a division […]
Summary of Posts on Disclosure of Litigation Contingencies
/7 Comments/in Pure Content, You Can Quote Me On ThatI’ve written extensively on the subject of disclosure of litigation contingencies, most recently for Forbes. My feelings about any clashes between auditors and accountants over disclosures for contingencies were outlined, with no subtlety, when the idea of tightening the requirements was first proposed in 2008.
Barney Less Than Frank About Auditor Reform
/9 Comments/in Food for ThoughtWhat do you get when you mix public pressure, lobbyist money and legislators that think doing anything is better than finally doing the right thing? Not one provision of either current House or Senate financial regulatory reform legislation touches the accounting industry.