June 20, 2006

The PCAOB Gets a New Chair: Mark Olson

Yesterday, SEC Chairman Cox named Mark Olson as the new Chair of the PCAOB, replacing Acting Chair Bill Gradison (who continues on as a Board Member). In addition, Kayla Gillan got her wish and was reappointed for a second term as a Board Member (after waiting more than six months for the news!).

As this press release indicates, Mark has served as a Federal Reserve Governor since 2001 – before that he served as the Staff Director of the US Senate Securities Subcommittee of the Banking, Housing, and Urban Affairs Committee for two years, was a Partner at E&Y for 11 years and a CEO of a state bank for over a decade. It must feel peculiar for the SEC Chairman to appoint someone to a position that pays over 3x what he makes…

PCAOB’s Chief Auditor Weighs In: Evaluating Internal Controls

A few weeks back, the PCAOB’s Chief Auditor, Tom Ray, delivered this speech with a notable message: hop onto that learning curve, auditors. His speech directly addressed the “over-documentation” complaints making the rounds. Learn more about the speech from the AAO Weblog.

More on Harmonization (Or Lack Thereof) of Global Regulations

Not soon after I blogged on Friday, the SEC issued this warm and fuzzy fact sheet that globalization and merger of exchanges would not ultimately lead to mandatory registration of non-US exchanges (here is a related WSJ article from yesterday). Not surprising given SEC Commissioner Nazareth’s recent comments on this topic.

What is curious about this development is that the SEC put out its message via a “fact sheet.” This “fact sheet” is posted on the SEC’s website under “Press Releases” rather than the seemingly more appropriate “Other Commission Orders, Notices, and Information.” The question remains: do we now add “fact sheets” to the dozen or so other vehicles by which the SEC provides guidance to market participants?

DOL Panel Backs Order of Whistleblower Reinstatement

As noted in this Washington Post article, the Cardinal Bankshares whistleblower saga continues as the Department of Labor’s Administrative Review Board ruled that the company must reinstate its former CFO. The DOL panel denied a request by the company to stay a Labor Department judge’s earlier order that it take the CFO back – and afterwards, the company said it would not bring the CFO back until it is compelled to do so by the US District Court for the Eastern District of Virginia (ie. Welch v. Cardinal Bankshares Corp, as I first blogged about well over a year ago; see these law firm memos to follow the saga to date). So this is not over until it’s over.

In my mind, a reinstatement remedy is simply unworkable; there has got to be some other way. Can you imagine firing your CFO and then being forced to rehire him? That wouldn’t seem to bode well for overall company morale, not to mention collegiality among senior officers…

[Will you still read me…when I’m 64? So much craziness over Paul McCartney’s 64th birthday. That’s twenty years away for me – God willing – and if I’m still blogging at 64, I vow to do something spectacular for those of you still reading this dribble…not sure what, but I promise it will be glorious and you will be thankful for having patiently waited. Maybe something that Nacho would do…]