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The Securities and Exchange Commission (“SEC”) recently announced three new enforcement initiatives in its ongoing fight against fraud: “The Financial Reporting and Audit Task Force dedicated to detecting fraudulent or improper financial reporting, whose work will enhance the Division’s ongoing enforcement efforts related to accounting and disclosure fraud. The Microcap Fraud Task Force targeting abusive trading …
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Permanent link to this article: https://betweenthenumbers.net/2013/07/sec-announces-new-anti-fraud-initiatives/
The Federal Trade Commission (“FTC”) is currently distributing $40 million in association with its false advertising settlement with Skechers. The FTC alleged that Skechers had marketed its Shape-up athletic shoes and other toning shoes based on unproven benefits, specifically stating that Skechers “deceptively advertised its toning shoes, including making unfounded claims that its Shape-ups shoes …
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Permanent link to this article: https://betweenthenumbers.net/2013/07/40-million-verdict-in-skechers-case/
In 2011, the Public Company Accounting Oversight Board (“PCAOB”) issued a Concept Release on Auditor Independence and Audit Firm Rotation, seeking public comment on: “ways that auditor independence, objectivity and professional skepticism could be enhanced. One possible approach on which the Board is seeking comment is mandatory audit firm rotation.” Apparently, the House of Representatives had a …
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Permanent link to this article: https://betweenthenumbers.net/2013/07/house-prohibits-mandatory-audit-firm-rotation/
The Financial Accounting Standards Board (“FASB”) recently issued a proposal to improve practices surrounding the responsibility for assessing and reporting whether an entity is a “going concern”. Financial statements prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) have an inherent presumption that the entity is able to continue with its operations, realizing its assets and honoring its …
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Permanent link to this article: https://betweenthenumbers.net/2013/07/fasb-stepping-in-on-going-concern-assessments-and-disclosure/
The Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) has released an updated Internal Control – Integrated Framework in the fight against fraud. It provides expanded practical advice regarding effective implementation of internal controls. COSO is a joint initiative of five private sector organizations with a shared interest in enterprise risk management, internal control and fraud …
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Permanent link to this article: https://betweenthenumbers.net/2013/06/new-guidelines-for-fraud-deterrence/
A recent decision has clarified the reach of the protections offered to whistleblowers under Section 806 of the Sarbanes-Oxley Act of 2002 (“SOX”). In the matter of Lockheed Martin Corporation v. Administrative Review Board, United States Department of Labor, it has been determined that SOX whistleblower protection extends beyond employee reporting of frauds on shareholders. …
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Permanent link to this article: https://betweenthenumbers.net/2013/06/whistleblower-protection-does-not-require-fraud-on-shareholders/
The Securities and Exchange Commission(“SEC”) announced the agency has approved its second Dodd-Frank whistleblower award since the program’s 2011 inception, this time to three individuals who were each deemed to have provided information related to a $7.5 million enforcement action that was (i) voluntary, (ii) original, and (iii) led to the successful result. The SEC’s “fact …
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Permanent link to this article: https://betweenthenumbers.net/2013/06/sec-whistleblowers-rewarded/
The AICPA has issued a new Financial Reporting Framework (“FFR”) for Small and Medium Sized Entities (“SMEs). These smaller enterprises are often not required to prepare financial statements in accordance with Generally Accepted Accounting Principles (“GAAP”). Yet all financial statements are presented in accordance with some financial reporting framework, however defined. This new FFR provides …
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Permanent link to this article: https://betweenthenumbers.net/2013/06/aicpa-issues-financial-reporting-framework-for-small-and-medium-sized-entities/
A recent report by the Federal Trade Commission (“FTC”) entitled “Consumer Fraud in the United States, 2011: The Third FTC Survey” provides some interesting statistics on the prevalence of fraud. The underlying consumer surveys revealed that during 2011 an estimated 10.8 % of U.S. adults (25.6 million people) were a victim of one or more of an estimated total …
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Permanent link to this article: https://betweenthenumbers.net/2013/06/more-than-10-of-us-adults-were-victims-of-fraud-in-2011/
Even after the increased regulation associated with the Sarbanes-Oxley Act (SOX) in July 2002, the audit profession continues to deal with questions of whether they are truly independent from the companies who employ them and overall audit effectiveness. A recent report commissioned by the Center for Audit Quality (“CAQ”) specifically examines Securities and Exchange Commission …
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Permanent link to this article: https://betweenthenumbers.net/2013/05/battling-auditor-enabled-fraud/
