Accounting standards

Harley-Davidson announced that the Securities and Exchange Commission is investigating shareholder complaints that the motorcycle manufacturer engaged in channel stuffing.

California Rep. Christopher Cox, President Bush's nominee for chairman of the Securities and Exchange Commission, disclosed his stock, mutual fund and other assets on Tuesday, the value of which could range from $2.7 million to $5.9 million.

The executive stock option settlement initiative launched in February has received a strong turnout, according to the Internal Revenue Service. The initiative provided corporate executives and their companies a means to resolve an abusive tax transaction involving the transfer of stock options to family controlled partnerships.

After nearly two years of deliberation, the Securities and Exchange Commission dismissed an administrative proceeding against two former partners of Arthur Andersen & Co. last week.

DreamWorks Animation SKG Inc., the studio behind "Shrek" and "Shark Tale," announced on Monday that the Securities and Exchange Commission has launched a probe into trading of its stock and the release of its first quarter results in May.

Krispy Kreme Doughnuts Inc. named Douglas R. Muir, a consultant to the company since December 2004, as the company's new chief accounting officer on Friday.

Better than one in every eight U.S. corporations that have undergone the more rigorous audits mandated by the Sarbanes-Oxley Act during the past year have been flagged for ineffective internal controls over their financial reporting, officials at the Public Company Accounting Oversight Board disclosed during a recent meeting with the organization's Standing Advisory Group.

Since Sarbanes-Oxley regulations went into effect for large enterprises, holding executives accountable for their company's financial records, the spotlight has been slowly turning towards nonprofits.

The Financial Accounting Standards Board has taken a long look at an international standard on accounting changes, found it better than the American standard, and promptly adopted the gist of the international position.

Some taxpayers apparently believe that the ability to claim a charitable deduction for donation of an automobile ended on Dec. 31, 2004. The advertisements on the radio would make one believe that nothing has changed, and that you can still claim a deduction for donated automobiles just as before Jan. 1.

One of contemporary accounting's most persistent issues has taken a turn toward resolution as the American Institute of CPAs and the Financial Accounting Standards Board agreed to consider creating some kind of generally accepted accounting principles for privately held, for-profit companies.

Every so often, people and organizations mistakenly become so self-satisfied that they stumble into assuming their own infallibility, often accompanied by smug statements. Inevitably, events turn these boasts to dust.

An online filing error has revealed that the Public Company Accounting Oversight Board authorized a probe into a 2003 audit performed by Big Four accounting firm Deloitte & Touche LLP.

The U.S. Chamber of Commerce filed paperwork last Thursday to again challenge a U.S. Securities and Exchange Commission rule requiring that a mutual fund's chairman and three quarters of its directors be independent of the company.

A top litigation counsel for the Securities and Exchange Commission will step down in August to become head of regulatory affairs for Merrill Lynch in New York.

The Public Company Accounting Oversight Board will host a forum in early August, "Auditing in the Small Business Environment," in Orlando, Fla., designed for registered accounting firms and public companies working in the small business community.

The International Auditing and Assurance Standards Board, a unit of the International Federation of Accountants, has released ISRE 2410, a standard to assist auditors in reviewing interim financial statements.

Former Securities and Exchange Commission Chairman Arthur Levitt has been named as a special advisor to insurer and financial services provider American International Group Inc.

Barely a week after a federal jury found HealthSouth founder Richard Scrushy not guilty of participating in a massive accounting fraud, the Securities and Exchange Commission is preparing civil charges against the former chief executive.Scrushy was the first CEO charged under the Sarbanes-Oxley Act and had faced 36 counts of fraud, false corporate reporting and making false statements to regulators after prosecutors said that he led a $2.7 billion earnings overstatement at the medical services company beginning in 1996.After a five-month trial and nearly another month of jury deliberations, he was acquitted on all counts.According to a report from The Washington Post, the SEC will file the formal paperwork on Thursday to retry Scrushy and seek $786 million in penalties and disgorgement. The HealthSouth founder would also not be allowed to serve as an officer or director at any public company if found guilty. Scrushy remains a member of HealthSouth's board of directors.In bringing a civil claim, the SEC most show "a preponderance of the evidence" that Scrushy was involved in and had knowledge of the fraud, a lower burden than the "reasonable doubt" standard required for a criminal conviction.Two other former executives, including HealthSouth's first finance chief, Aaron Beam, and former vice president Will Hicks, who both pleaded guilty and testified against Scrushy, are set for sentencing this summer. Another pair of indicted executives are awaiting trial in Alabama.

Senators Connie Mack and John Breaux, chairman and vice-chairman of the President's Advisory Panel on Federal Tax Reform, respectively, announced that the panel's 10th meeting will be held on Wednesday, July 20. The meeting will be held at the Renaissance Hotel here. The panel has held nine meetings in which witnesses testified about problems with the current tax system and various options for reform. At this meeting, panel members will discuss issues associated with reform, but there will not be any testimony presented. The President's Advisory Panel on Federal Tax Reform was established by President Bush in January and charged with recommending reforms to the tax code that would make the U.S. tax system simpler, fairer and more growth-oriented. The panel's final recommendations are due by Sept. 30, 2005.