Understanding internal controls over financial reporting (ICFR) is very important for the implementation of the new Dodd Frank Act.
And, who really understands internal controls? Yes, Sarbanes Oxley professionals. Absolutely.
Today we will spend some time to understand the Dodd Frank Act, and the new ICFR environment and requirements.
Some interesting developments:
According to the Sarbanes-Oxley Act, publicly traded companies cannot punish employees that reveal suspected fraud.
Reveal to whom?
Can you reveal suspected fraud to the media?
Today we have a clear answer: No, you are not protected if you reveal suspected fraud to the media.
According to the Ninth U.S. Circuit Court of Appeals, you are protected if you speak to federal regulators, Congress or a workplace supervisor - to those with "the capacity or authority to act effectively on the information" as Judge Barry Silverman said in the court's ruling.
Leaks to the media are not protected.
The ruling has to do with the well known case of two Boeing Co. auditors who were fired in 2007, after telling a reporter that they were being pressured to deliver favorable reports about the security of Boeing's internal computer software.
According to the Boeing spokesman John Dern, the ruling supported corporate policies that require employees to keep internal information confidential.
Another interesting development:
James R. Doty has been appointed by the Securities and Exchange Commission as the Chairman of the Public Company Accounting Oversight Board.
