Accounting compliance increases investor fears
More than a dozen companies on Thursday reported deficiencies with their internal accounting controls, forcing them to delay the filing of annual reports to regulators and sending investors for the exits.
Names such as Advent Software Inc., Ligand Pharmaceuticals Inc. and auto supplier Collins & Aikman Corp. dropped in trading after disclosing they need more time to file audited financial reports with the Securities and Exchange Commission. The companies said they came up short in efforts to comply with Sarbanes-Oxley Act corporate accountability laws -- and might have to restate earnings all together.
These companies join some 500 others -- from Eastman Kodak Co. to SunTrust Banks Inc. -- who have told shareholders they can't ensure their financial reports are accurate and reliable under rules that will now be enforced by regulators. The more stringent guidelines are being thrust upon public companies in the wake of accounting scandals at Enron Corp. and Worldcom Inc. Read on.