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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Jeffrey D who wrote (2388)	8/14/2002 1:40:50 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 25522

Corporate America Floods SEC with Oaths By Kevin Drawbaugh WASHINGTON (Reuters) - The top brass of hundreds of America's biggest companies flooded the U.S. Securities and Exchange Commission on Wednesday with pledges that their latest financial statements were honest and complete, under a commission order meant to help restore damaged investor confidence. Chief executives and chief financial officers of almost 400 companies had filed personal certifications of results by mid-morning. About 700 of the 947 companies covered by the sweeping order were required to submit oaths in writing and electronically by 5:30 p.m. EDT. As nervous markets watched for companies failing to comply, the SEC was referring investors to the online Edgar filing system (http://www.edgar-online.com) to check whether individual company CEOs and CFOs had filed. Imposed on June 27 amid a wave of multibillion- dollar accounting scandals ranging from Enron Corp. to WorldCom Inc., the commission's order was followed a month later by a raft of new laws for companies from Congress. The laws, contained in a bill drafted by Sen. Paul Sarbanes and Rep. Michael Oxley, will make CEO and CFO certifications routine for all of the 14,000 companies policed by the SEC, not just the 947 large-cap firms targeted by the commission's order. So law firms were advising clients to get in the habit of certifying as of Wednesday, although penalties for failing to do so immediately were not entirely clear. "The Sarbanes-Oxley bill has two somewhat inconsistent certification requirements," said Frank Goldstein, a partner at the law firm of Sidley Austin Brown & Wood in Washington. Laura Unger, a former SEC commissioner, said in a CNBC interview that Wednesday's certifications under Sarbanes-Oxley were "sort of a dress rehearsal for the legislation that's been enacted.... In the future, CEOs and CFOs will have to sign off on all financial statements." SWIFT MARKET ACTION Market punishment for the stock prices of companies that were not in compliance was likely to be swift and certain, however, with investors increasingly wary of corporate book-cooking. Some companies will be allowed to certify after Wednesday, due to their non-calendar fiscal years, and the SEC was willing to grant five-day extensions to some firms facing delays. Fears of a wave of restated results had not materialized, with more than a quarter of filings in, although accounting experts said there was still time for red flags to fly. A few companies were expected not to meet the deadline, such as bankrupt long-distance telephone and Internet traffic carrier WorldCom, which is restating its books after uncovering a $7.6 billion accounting fiasco in recent weeks. Energy company Nicor Inc. said on Wednesday its executives could not certify its 2002 interim results under the Sarbanes-Oxley law. However, executives were able to certify past results in accordance with the SEC order. Nicor is one of many energy companies under SEC scrutiny. The CFO of energy trader CMS Energy Corp. told investors last week he could not certify its books until they were restated to account for more than $4 billion worth of sham trades. Other energy trading groups, under a cloud since the collapse of former Texas energy trading leader Enron last fall, have expressed certification doubts as well. Each CEO and CFO must file a separate certification on a standard SEC form. If unable to certify a company's latest 10-K annual report and subsequent 10-Q quarterly and other statements, the CEO or CFO must tell the SEC why under oath. The SEC, led by Chairman Harvey Pitt, has said it will handle problem filings on a case-by-case basis. A court test of the SEC's authority to impose the order was viewed as possible someday, although lawyers said it was unlikely that any reputable company would challenge the SEC soon.