Posts Tagged ‘control environment’
More Thoughts on Policies
Today I want to return to that study we discussed last week, questioning whether corporate policies make much difference to encourage employees’ compliance behavior. There is still a lot to discuss from that study, and compliance professionals’ reaction to it, in the pursuit of good insights about policy management and employee training. For those who…
Read MoreFood for Thought From Kraft Heinz
We have a fascinating enforcement action from the Securities and Exchange Commission to study, this time against Kraft Heinz Co., which is paying $62 million to settle charges that it committed accounting fraud with a bogus cost-savings scheme. The case is a glimpse into how strategic imperatives can pressure internal controls — and at least…
Read MoreSEC Straps Leather Company on Control Failures
The Securities and Exchange Commission has charged a Texas leather goods company with failing to maintain an effective inventory accounting system, which ultimately led the firm to restate two years’ worth of financial results and send its CEO packing. It’s a cautionary tale for the rest of us about how a poor control environment can…
Read MoreOther Lessons in Verwaltung Case
You may have seen news last week that a Swiss bank, LLB Verwaltung, paid $10.7 million to the Justice Department to settle charges of tax evasion. The deal is notable because the bank’s compliance officer had warned senior executives about the risks they were taking — warnings that senior bank executives chose to ignore. So…
Read MoreBad Control Environments Ruin Everything
The compliance and audit worlds like to rely on lingo such as “control environment” and “control activities” all the time. The scandal of Corporate America’s payments to Michael Cohen, personal lawyer and fixer to President Trump, reminds us what those words really mean, and why a bad control environment can sour all the control activities you…
Read MoreAnd the Oscar for Control Failures Goes to…
Internal control enthusiasts everywhere are performing a root cause analysis of what went wrong at the Oscars this weekend, so Radical Compliance might as well get a piece of that action too. After all, when was the last time a control failure was household news? The debacle, for those last few who haven’t yet heard…
Read MoreOf Contract Labor and Your Control Environment
The KPMG Audit Committee Institute recently published its annual survey of audit committee worries—and don’t die of shock, but maintaining high ethical rigor across the extended enterprise was a big concern. KPMG phrased the issue as “maintaining the control environment in the company’s extended organization.” It ranked third among audit committee worries, tied with cybersecurity and…
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