Corporate auditing is broken. Here’s how to fix it – CapX

Can any auditor be truly independent if it is selected by the management it is supposed to review without conflicts? The corporation’s shareholders – key users of the audit report – nominally have the authority to choose auditors. But this authority is usually exercised upon the recommendation of the corporation’s board of directors, which customarily…

Why Shareholders Should Be Cautious of These KPMG Audits, Despite SEC Assurances

SEC Chair Jay Clayton basically told investors “nothing to see here” when five KPMG partners were indicted for unlawfully using prior knowledge of confidential information from their regulator, the PCAOB. Francine McKenna quoted VEA Vice Chair Nell Minow in an article for Marketwatch: Corporate governance expert Nell Minow, the vice chair of ValueEdge Advisors, said…

Non-GAAP Measures: Questions and Insights

Cindy Fornelli of the Center on Audit Quality writes about perspectives from a series of roundtables with audit committee members, management, investors, securities lawyers, and public company auditors on non-GAAP reporting:   If GAAP is the bedrock, why do companies present non-GAAP measures? Participants were asked to share their views on what drives the presentation…

Are Auditors Reliable?

A new report from the International Forum of Independent Audit Regulators shows that global accounting watchdogs identified serious problems at 40 per cent of the audits they inspected last year involving companies in “riskier” situations, such as M&A deals. These included conflicts that compromised objectivity, and widespread failures to test the accuracy and reasonableness of…

New ABA Report on Climate Change and Sustainability Financial Reporting

VEA Vice Chair Nell Minow co-wrote one of the articles in this new American Bar Association report with 5050 Climate Project Executive Director Edward Kamonjoh. Also included, George Dallas on “Climate Change as a Matter of Corporate Governance: An Investor Perspective.” “Climate Change and Sustainability Financial Reporting”

The Danger Of Not Embracing ESG

According to Rivel Research Group, a firm that specializes in delivering actionable insight based on in-depth measurements of the investment community, ESG has six pillars: enhancement of market and accounting performance; lowering the cost of capital, a means to engage key shareholders; improving business reputation; fostering new revenue growth through product innovation; and aligning company…