The Board of Directors ans Audit Committee Guide to Fiduciary - Ten Critical Steps to Protecting Yourself and Your Organization

More than three million people serve on boards and audit committees in the U.S. alone. But huge risks come with these coveted jobs. SEC scrutiny is at an all-time high, with boards and audit committees now held liable to for acts of fraud and other corporate malfeasance-even if they had no knowledge of wrong-doing in the organization.This essential guide mitigates the risks and dramatically increases the effectiveness of boards and audit committees by uncovering 10 crucial steps every governing body should take, including: . Cultivate independence . Build a balanced team . Leverage independent advisors . Address stakeholder concerns . Direct the external audit . Approach risk proactively . Spearhead fraud deterrence initiatives . Promote accountability . And more Comprehensive and practical, this book simplifies complex corporate governance standards, and helps readers satisfy the requirements of board service while protecting themselves and the organization.

List of contents

Contents

Introduction 1

CHAPTER ONE:Nominate Independent Directors 6

Nominating Committee Perspective 6

Candidate Perspective 15

CHAPTER TWO:Establish a Culture of Action 18

Expectations of Audit Committees 18

Essential Audit Committee Proficiencies 22

CHAPTER THREE:Evaluate the Audit Committee 28

Why Should Evaluations Be Considered? 28

Who Is Best Positioned to Conduct the

Evaluation? 30

When Should Evaluations Be Performed? 31

What Should Be Evaluated? 32

How Should the Evaluation Be

Performed? 34

CHAPTER FOUR:Direct the External Audit 36

The External Audit Process 37

Potential Roles of the Auditor 45

Hiring, Evaluating, and Replacing the

External Auditor 47

CHAPTER FIVE:Scrutinize the Financial Statements 53

Types of Financial Misstatements 53

Governance Protocols 61

CHAPTER SIX:Leverage Internal Audit and Outside Resources 87

The Internal Audit Mandate 87

Internal Audit Oversight 89

Internal Audit Administration 97

Signs of an Ineffective Internal Audit

Function 100

CHAPTER SEVEN:Satisfy Regulators and Other Stakeholders 104

Regulators 105

Other Stakeholders 121

CHAPTER EIGHT:Address Risk Proactively 124

Risk-Management Frameworks 125

Risk Identification 126

Risk-Ranking Tools 128

Risk Response 132

Reporting Risk 137

Risk-Assessment Follow-Up 142

CHAPTER NINE:Spearhead Fraud-Deterrence

Initiatives 148

Types of Fraud 149

Fraud-Deterrence Tools 163

CHAPTER TEN:Expect the Unexpected 186

The Need for Crisis-Management and

Crisis-Media Plans 186

Board-Level Fraud Response 191

The Need for CFO and CAE Succession

Plans 201

Conclusion 205

Forty Key Action Items 205

Notes 213

Index 223

About the author

SHEILA MORAN, CPA, CFE is CFO at Professional Power Products and serves on the faculty of the Association of Certified Fraud Examiners.RONALD KRAL, CPA, CMA, CGMA is managing partner at public accounting firm, Candela Solutions LLC.

Summary

You took the highly coveted position on the board or audit committee--now it’s time to figure out what you’re doing. And with SEC scrutiny at an all-time high, there is little room for growing pains. Boards and audit committees can now be held liable for acts of fraud and other corporate malfeasance even if they had no knowledge of wrongdoing in the organization.But relax! This comprehensive and practical guide greatly simplifies complex corporate governance standards, while mitigating the risks involved in the arduous work and increasing dramatically the positive effect over the enterprise that motivated you to take the position you did. Inside these essential pages, discover 10 crucial steps every governing body should take, including:• Cultivate independence • Build a balanced team • Address stakeholder concerns • Approach risk proactively • Spearhead fraud deterrence initiatives • And moreYou should be commended for taking on the duties you have, not intimidated. With this invaluable resource by your side, you can learn how best to satisfy the requirements of board service while also protecting yourself, the other board members, and the organization you have committed to lead to success.

Product details

• Authors: Ronald Kral, Sheila Moran, Sheila Kral Moran
• Publisher: Amacon Book Division
• Languages: English
• Age Recommendation: from age 18
• Product format: Hardback
• Released: 01.07.2013
• EAN: 9780814431665
• ISBN: 978-0-8144-3166-5
• No. of pages: 224
• Series: Agency/Distributed
• Subjects: Social sciences, law, business > Business; BUSINESS & ECONOMICS / Corporate Governance, BUSINESS & ECONOMICS / Business Law, BUSINESS & ECONOMICS / Auditing