Post Enron/Worldcom - Sarbanes-Oxley law... are corporate

[salin]

filings more accurate? Has corporate America cleaned up its act? If not - will there be another round of corporate implosions in the future (ala - faked earnings and massive debts can only be hidden for so long).

Recall that there was a board formed to shepherd in revision to major accounting practices shortly after the bill became law. Respected figure Paul Volker led the effort. After six months (or less?) he resigned publically stating that key reps from the accounting firms made it clear there was NO will to change anything and that the normal operating procedures that were prevalent and that allowed huge corporate fraud from occuring undetected - were going to remain the normal operating procedures.

But somehow - this is rarely discussed.

One of the very disturbing issues that became clear in the reporting in the aftermath of the 02 corporate implosions was the very high level of risky debt carried by major financial institutions such as JP Morgan; the issue of note (in the stories) another series of major implosions could have huge ripple effects upon said financial institutions - and that the situation almost pushed bad investments to follow bad investments (as in pouring money in to try to salvage previous investments). Again - hard to find in the follow up in the MSM per the shape of these institutions today. Have they "corrected" - or did they, too, go back to 2002 standard operating procedures?

Anyone still paying attention at all?

[UpInArms]

1. JMHO

the corporatists will fight the Sarbanes-Oxley forever.

here's what the bizness district says:

State of American Business 2006 Press Briefing

Thomas J. Donohue
President and CEO, U.S. Chamber of Commerce

U.S. Chamber of Commerce
Wednesday, January 4, 2006

excerpt:

Our Institute for Legal Reform will educate voters in states where there are important elections for Supreme Court judges and attorneys general.

And our law firm, the National Chamber Litigation Center, will aggressively represent the interests of the business community in court.

The Chamber’s effort to stop overreaching regulators and abusive prosecutors in the aftermath of Sarbanes-Oxley will continue full speed ahead.

We have formed an independent Capital Markets Commission to address the role that federal and state regulations, as well as trial lawyers, are having in driving companies and capital away from our markets.

Look for some interesting activities from the Commission in the coming months.

[salin]

2. er.... what regulators let alone overreaching ones?

yet folks are still gambling on the stock market like there is no tomorrow. For a minute, after the second round of implosions, it appeared that the public "got" the problem. Earnings reports that have so many gimmicks in them that are almost impossible to understand, are absolutely meaningless. With no meaning, there is no real way to judge investing in x company over y company. A complete crap shoot. There is also no incentive for the gimmickery to stop - and thus making sound long-term business planning decisions that may divert some earnings into reinvestment - is more likely to be viewed as frivolous - as it doesn't help the quarterly earnings report. *sigh*

[UpInArms]

3. in posting to the SMW, I constantly see where

reports are not filed on time, are revised for years back, have estimated and incomplete information, ad nauseum..

I don't think that the SEC regulators have a grip on any of it and the business lobbyists are busy busy busy making certain that real regulation and enforcement doesn't happen evenly.

Oh yeah, there are a few (and I mean few) cases (McAfee yesterday) where someone comes clean and pays a hefty fine and all is forgotten and swept under the rug and the market ignores what happened and they do their lemmings antics.