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Supreme Court Could Open Door to SOX Changes by ProQuest


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									     proposed corporate penalties. Khuzami, a no-nonsense               NEWS
     former federal prosecutor, told the Senate Banking,
     Housing, and Urban Affairs Committee that he con-
     curred with the recommendations of the GAO report.
     The Cox-era policy essentially allowed individual com-       FASB Issues Two New
     missioners to veto staff enforcement recommendations.
     The drastic falloff in SEC corporate penalties since 2006
     has sent a message to the business community that as         Last month the Financial Accounting Standards Board
     long as a financial reporting transgression, for example,    (FASB) published two new Statements of Financial
     doesn’t hurt shareholders, then there won’t be much of a     Accounting Standards (SFAS). SFAS No. 166, “Account-
     price to pay in terms of an SEC fine. Khuzami said the       ing for Transfers of Financial Assets,” and SFAS No. 167,
     SEC will be making some policy changes in regard to          “Amendments to FASB Interpretation No. 46(R),” change
     corporate enforcement. “To me, the focus of any penalty      the way entities account for securitizations and special-
     policy should be assurance that malefactors get appro-       purpose entities. The FASB says the new standards will
     priately severe sanctions to sufficiently deter them and     impact financial institution balance sheets beginning in
     others from engaging in similar misconduct in the            2010 and that the impact of the new standards has been
     future,” he stated.                                          taken into account by regulators in the recent financial
                                                                  institution “stress tests.”
       GOVERNMENT                                                    SFAS No. 166 is a revision to SFAS No. 140, “Account-
                                                                  ing for Transfers and Servicing of Financial Assets and
                                                                  Extinguishments of Liabilities,” and will require more
                                                                  information about transfers of financial assets, including
                                                                  securitization transactions, and where companies have
     Supreme Court Could                                          continuing ex
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