Compliance
Macy's discloses accounting concealed up to $154 million in delivery expenses
Macy's disclosed ahead of Black Friday that an accountant responsible for accounting for small delivery expenses deliberately concealed up to $154 million in costs, spanning from the fourth quarter of 2021 to the fiscal quarter ending November 2, 2024. The employee has left the company, and an internal investigation found no other employees were involved. The company delayed its third-quarter earnings report originally scheduled for Tuesday and expects to release results and investigation details by December 11.
UPS fined $45 million by SEC for significant financial misstatements
The U.S. Securities and Exchange Commission (SEC) fined UPS $45 million, alleging that in 2019 it failed to perform goodwill impairment testing on its UPS Freight business, leading to inflated valuations and misleading investors. UPS has agreed to settle without admitting or denying the allegations.
Evolv Technologies CFO Departs as Investigation into Misconduct and Revenue Misreporting Nears Conclusion
Evolv Technologies CFO Mark Donohue resigned after an investigation into sales practices, with the company disclosing revenue recognition errors and appointing an interim CFO. The investigation also led to the departure of four employees, and the company faces regulatory scrutiny.
SEC Chairman Gensler to Step Down on January 20, Having Strengthened Rulemaking and Enforcement During Tenure
U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler announced he will step down on January 20, 2025, coinciding with President-elect Trump's inauguration day. During his tenure, Gensler drove multiple major rulemakings, including central clearing for Treasury securities, climate risk disclosure, and cybersecurity rules, while also strengthening enforcement, initiating over 2,700 enforcement actions and securing more than $2 billion in penalties and disgorgement returned to investors.
Audit Committee Responsibilities Expand to ESG, Cybersecurity, and AI: EY Report
A report released by EY on Monday indicates that audit committees of S&P 500 companies have expanded their oversight to areas including cybersecurity, sustainable development, and artificial intelligence. Since 2021, the proportion of companies listing sustainability as an audit committee responsibility has jumped from 6% to 22%, while the proportion related to cybersecurity has risen from 25% in 2019 to 77%.
Study: GAAP Asset Measurement Rules May Allow Anticompetitive Mergers to Bypass Regulatory Review
Researchers from Stanford University and the University of Chicago note in a new paper that because current merger review thresholds are based on asset value measurements under Generally Accepted Accounting Principles (GAAP), which largely ignore intangible assets, hundreds of transactions each year, particularly in the technology and pharmaceutical sectors, may go unreported to the U.S. Federal Trade Commission (FTC) and the Department of Justice (DOJ). The researchers estimate that if intangible assets were taken into account, the number of reported transactions would increase by approximately 263 per year.
How to Strengthen Cybersecurity Defenses in the AI Era
The rise of generative artificial intelligence (GenAI) has brought powerful, accessible, and scalable tools that can be exploited by fraudsters, leading to a range of cybersecurity issues from data breaches to malware, and resulting in various forms of theft. This article analyzes the current threat landscape of GenAI fraud through real-world cases and industry forecasts, and proposes defensive recommendations such as learning about technology, identifying vulnerabilities, training employees, cross-departmental collaboration, and sharing experiences to help enterprises mitigate risks.
Trump Media CFO Plans to Sell $13.4 Million in Stock by December 2025
Phillip Juhan, Chief Financial Officer of Trump Media and Technology Group (parent company of Truth Social), has adopted an SEC Rule 10b5-1 trading plan to sell approximately $13.4 million worth of company stock from this month through December 2025. The plan was filed with the SEC on November 5. Juhan plans to sell 400,000 shares, with Monday's closing price at $33.41. Previously, Juhan sold approximately $1.9 million in stock in August to pay taxes.
Study: Consumers May View Fed as Republican Ally During Trump's Presidency
A recent paper by the National Bureau of Economic Research (NBER) indicates that if Trump returns to power, 84% of consumers may no longer believe in the Fed's political independence and instead perceive it as leaning toward the Republican Party. This conclusion is based on a survey of 5,025 consumers and raises concerns about central bank credibility and inflation expectations.
ADM Reports Another Accounting Error, Cancels Earnings Call and Lowers Full-Year Guidance
ADM announced on Monday that it will correct newly discovered internal sales accounting errors, restate its fiscal 2023 and first and second quarter 2024 results, and cancel its scheduled Tuesday earnings call. The company lowered its full-year EPS guidance to $4.50-$5.00, and shares closed down 6% at $51.99 that day.