Monday, April 10, 2006
Fraud Law Spurs Backlash, Integrity
When Carmen Requena's employer asked her to lead internal audits, she quickly learned that the job made her as popular as a meter maid.
Such audits had never been done at her midsize software company, and her team was formed in response to the demands of a stringent federal antifraud law known as the Sarbanes-Oxley Act.
"The very first meetings that I started to attend, people were sort of dragging their feet and not tremendously thrilled at what they had to do," she says.
But during the past 18 months, grudging reluctance has given way to acceptance and even the view that the rigorous new accounting standards entail benefits as well as costs for the company, Micros Systems in Columbia, Md.
It's a story that's been repeated in many corporations in the wake of the scandal at Enron Corp., which symbolized American dynamism until hidden losses forced it into sudden bankruptcy — and prompted Congress to enact the Sarbanes-Oxley legislation of 2002.
posted by Brian Moran @ 9:19 AM