Panel Of Experts Share Their Views On Business In The Post-Enron Era
Accountants, Investors, Employees and Companies Expect More Regulation, More Accountability Says Panel
(RIVERWOODS, ILL., April 30, 2002) – What may well be the immediate "Enron Effect" will be a return to audit quality and an increase in regulations, according to leading financial experts participating in a panel discussion at the Illinois Institute of Technology’s (IIT) Center for Law and Financial Markets.
The 16-page transcript of the talk, "After Enron…A Panel Discussion," appears in a special April 2002 issue of the Journal of Global Financial Markets, a quarterly journal created jointly by CCH INCORPORATED (CCH), a leading provider of tax, securities and business law information, and IIT’s Center for Law and Financial Markets to provide insights into the legal, economic and political implications of market globalization.
The Net Casts Wide: Who’s Affected and How
Jack Wing, Chairman of IIT’s Center for Law and Financial Markets, moderated the panel, which included a well-known fund manager, a former managing partner of Arthur Anderson, a law partner specializing in 401(k) plans and an investments professor.
"The panel participants each bring a depth of expertise to the issues and provide a better understanding of the regulatory and behavioral changes likely to result in the wake of the largest bankruptcy in U.S. history," said Margaret Gilling, editor of the Journal of Global Financial Markets.
Among the areas the panel discussed were new regulation in accounting practices as a result of abuses uncovered during the Enron investigations. Panelists also questioned future use of stock options as a method of executive compensation and the use of special purpose entities as a means of hiding debt. While regulation is likely, the panel also discussed how this may actually exacerbate the situation, as it could be the very complexity of regulations that provides loopholes where misconduct may occur.
The panel examined new approaches investors may take to safeguard themselves in the future, for example, through the return to a preference for dividend stocks as a means of assuring the soundness of the companies in which they invest.
As for employee protection, the panel said revisions to ERISA are very likely as a result of the losses employees suffered in the Enron affair, adding that new regulations may even encompass a return to defined benefit plans.
There may also be an over-cautiousness among companies "not to be the next Enron." The panel discussed the impact of this may be companies reporting lower earnings to avoid having to restate earnings in the future, more companies likely to expense employee stock options, employ stricter adherence to GAAP standards and be less reliant to special purpose entities as a means of hiding debt.
About Journal of Global Financial Markets
Launched in the spring of 2000 by the CCH Securities Group, Journal of Global Financial Markets provides unique insights into the legal, economic and political implications of market globalization, providing readers a deeper understanding of these various markets for better business decisions. The quarterly journal is available online and in print. An annual subscription is $149, plus applicable tax; print subscribers add shipping and handling.
About CCH INCORPORATED
CCH INCORPORATED, founded in 1913, has served four generations of business professionals and their clients. The company produces approximately 900 print and electronic products for tax, legal, securities, human resources, health care and small business markets. CCH is a wholly owned subsidiary of Wolters Kluwer North America. The CCH web site can be accessed at cch.com. The CCH Securities Group site can be accessed at business.cch.com/securities.
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EDITORS NOTE: For members of the press, a complimentary review copy of the April 2002 issue of the Journal of Global Financial is available by contacting Leslie Bonacum at 824-267-7153 or firstname.lastname@example.org.