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College of Business
October 21, 2002 -- News Brief
Robert Herdman (photo right), chief accountant of the Securities and Exchange Commission, offered his perspective on recent events in his keynote address to the two-day Symposium on Auditing Research, sponsored by the Department of Accountancy. The Symposium was sponsored by The KPMG Foundation and attracted faculty participants from across the country as well as Australia, Japan, and Singapore. It was held on October 17-19 in Champaign.
Appointed in September 2001, Herdman had minimal time to adjust before the Enron and other business scandals broke out. "The self-auditing strategy of the profession has to be considered a failure," Herdman told Symposium attendees. He also emphasized the Sarbanes-Oxley Act of 2002. Among other requirements, this legislation requires members of management to certify that their financial statements fairly present the financial condition and results of operations and to assess the effectiveness of their internal controls for producing financial information. Herdman also advocated a move towards principled-based accounting standards as a means to reduce the engineering of complex transactions that are in technical compliance with rules but that circumvent the intent of standard setters.
The Chief Accountant also met privately with undergraduate and graduate students from the College's nationally ranked Department of Accountancy. The department is internationally known for its Project Discovery curriculum.
Additional coverage of the chief accountant's remarks can be found online in:
The biennial Symposium also featured presentations of six research papers on various topics such as whether non-auditing services impair auditor independence, ways to improve auditors' assessments of the risk of financial-statement fraud, and the impact of the 1995 Private Securities Litigation Reform Act.
The Symposium was organized by Department of Accountancy faculty members A. Rashad Abdel-khalik, Paul Beck, Kathryn Kadous, Ira Solomon, and Mark E. Peecher (Chair).