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Friday, July 01, 2005

How To Dig Out From Under Sarbanes-Oxley

The dirty little secret of the first Sarbanes-Oxley audit is that no one really knew what they were doing. Not the auditors, not the consultants, not you.

For Al Schmidt, vice president of IT for Arch Chemicals, that became painfully obvious during a September 2004 meeting in which his internal auditor, PricewaterhouseCoopers (PWC), and his external auditor, KPMG, discussed...auditing standards. (Sarbanes-Oxley mandates that companies have different internal and external auditors to avoid Enron-like conflicts of interest.)

As Arch employees and about five auditors from each firm sat silently, the lead partners of the two firms went back and forth for about 20 minutes, debating the different methodologies that each was using for the Sarbanes-Oxley 404 review of the $1.2 billion specialty chemical manufacturer's internal controls. ››

"Let's just say it was a learned discussion between two parties," Schmidt says.

posted by Brian Moran @ 1:55 PM   0 comments

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