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Sarbox and Troubled Assets Relief Program Mean More Reviews for Big Banks

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Just like the economic crisis and the federal bailout package produce interesting twists for public company auditors, they also present new review requirements for the country's larger banks.

 

Jim Kim at FierceSarbox points out that the Troubled Assets Relief Program (TARP), a Department of Treasury fund authorized by the Emergency Economic Stabilization Act of 2008, passed early this month, requires those receiving bailout dollars to "restrict so called 'golden parachutes' and reduce the tax deduction on executive pay."

 

Since Sarbox requires review of public company earnings statements on a regular basis, bailout recipents can expect a review soon. Citing Reuters, Kim says the Securities and Exchange Commission wants to look at disclosures to "make clear exactly how pay practices have changed."

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