Tuesday, May 24, 2005
The Trust Buster
Trust. That's the point of the Sarbanes-Oxley Act: making sure investors can trust our financial statements. Of course, for anyone involved in Sarb-Ox compliance projects, it feels more like trust has been hanged, drawn, quartered, electrocuted, run over by a steamroller, then stood up against a wall and shot, just for good measure. With Sarb-Ox, it seems as if nobody in corporate America will ever be allowed to trust anyone ever again.
So there may not seem to be much comfort in the Sarb-Ox guidelines issued last week by the SEC [QuickLink 54486]. The agency's staff now says we can trust each other -- just a little bit.
That means not every single piece of financial data has to be rigorously controlled at every step in its life cycle; corporate management is allowed to use a little discretion. And auditors don't have to be grim, silent inquisitors; they're allowed to tell management what's wrong, explain why it's wrong and even suggest ways of fixing problems.
It's only a little ray of trust in what's become a very dark Sarb-Ox world. But right now, we can use all the hopeful signs we can get.
posted by Brian Moran @ 11:34 AM