HIH had all the mechanisms of good governance external directors, audit committees, and so on in place, yet they were ineffectual.
Late today, another Congressional committee investigating Enron's downfall, the House Energy and Commerce Committee, said both Mr. Skilling and Mr. Fastow would testify next Thursday, along with Enron's chief accounting officer, Richard A. Causey; its chief risk officer, Richard B. Buy; and the board of directors' audit committee chairman, Robert K. Jaedicke.
That means the auditors will be hired and fired by the board of directors' audit committee.
That simple process blew up when it became known that Webster sat on the board of directors' audit committee of an outfit called U.S. Technologies, now essentially defunct, that lately billed itself as an Internet incubator.
Any company these days is bound to be on the borderline of violating some antitrust statute, some environmental regulation, or some other law.If auditors do find clear instances of payoffs to government officials, or violations of other regulations, they should report them to the board of directors' audit committee and see that proper action is taken that, Seidler says, is their duty.
Dr Sied Sadek, Managing Director of auditing firm, DQS CFS and DQS Middle East, says: "international best practices are frequently thought of as universal, but they seldom are.
Question: Our association recently elected a new board of directors and audited the association's financials.
While there's nothing to stop businesses continuing with the operating system, Mark Brown, director of information security at auditing firm Ernst & Young, warns that doing so leaves them increasingly vulnerable to hacking.
The New York Stock Exchange is considering a requirement that directors on audit and compensation committees be independent.
"Outside directors and audit committees have gotten a scare," said Jennifer Arlen, a law professor at New York University.
