September 26, 2005

PCAOB Chair to Step Down

On Friday, PCAOB Chair William McDonough announced that he will resign his position November 30 or when his successor is in place, whichever is sooner. Here is the related press release. Even though I only heard him speak once, Chairman McDonough was one of the more charismatic speakers I have heard.

SEC Chair Cox has big shoes to fill when he selects a new PCAOB Chair. Here is Chairman Cox’s statement about Chairman McDonough’s departure. The process of selecting new PCAOB Board members is something quite new – it will be interesting to see if Chairman Cox renominates Kayla Gillan for another term, as I hear that she is more than willing to serve again.

SEC Posts 404 Adopting Release/Accelerated Filer Proposing Release

On Friday, the SEC posted the adopting release related to delaying the 404 deadline for smaller companies – as well as the proposing release related to the new accelerated filer definitions and deadlines for such companies.

Go Figure! HealthSouth Whistleblower Receives Longest Sentence of Them All

Last Thursday, the primary whistleblower in the HealthSouth fraud case got a longer sentence than all the other HealthSouth executives that have been dragged through the criminal process so far. US District Judge Robert Propst sentenced former finance chief Weston Smith to 27 months in prison, ordered him to pay $1.5 million in forfeited assets and spend one year on probation after his release – the Judge acknowledged the disparate range of sentences that have been imposed and essentially invited Mr. Smith to appeal his sentence to the 11th US Circuit Court of Appeals.

Meanwhile, former HealthSouth CEO and Chair Richard Scrushy – acquitted for his role in the fraud and who still sits as a HealthSouth director – is angling to get back on the management team (and the company’s Chair recently resigned). Here is the company’s press release responding to Scrushy’s recent criticism of management over the company’s poor earnings. The SEC’s civil lawsuit against Scrushy has yet to come – and odds are he will be barred from serving as an officer or director of a public company once that lawsuit is finalized.