Cox warns US not to drop accounting rules

Cox warns US not to drop accounting rules

SEC chief says that the US should learn fom the mistakes of the 1987 stock market crash and not consider drastic accounting changes

Christopher Cox has warned against making a knee-jerk reaction to the
financial crisis and bowing to pressure to change accounting standards.

The SEC chairman made the comments as he testified before the House of
Representatives’ Committee on Oversight and Government Reform in relation to the
financial crisis gripping the global economy.

‘If we continue to do what we were doing, and just do more of it, we will
undoubtedly repeat history. I remember working in the White House in 1987,
helping to determine how to respond to a 25% drop in the markets in one day,’
said Cox.

‘I see the very real similarities to current events — institutions borrowing
short and lending long, housing bubbles in California and Florida, pressure to
change accounting rules to give savings and loans time to right their balance
sheets. The nation subsequently spent upwards of $150bn to clean up the
wreckage.’

In his
testimony
Cox also said that the SEC would be tougher on company’s accounting and
auditing.

‘In strengthening the role of the SEC,[the watchdog will] build on these
traditional strengths — law enforcement, public company disclosure, accounting
and auditing, and the regulation of exchanges, broker-dealers, investment
advisers, and other securities entities and products.’

Share

Subscribe to get your daily business insights

Resources & Whitepapers

Why Professional Services Firms Should Ditch Folders and Embrace Metadata
Professional Services

Why Professional Services Firms Should Ditch Folders and Embrace Metadata

3y

Why Professional Services Firms Should Ditch Folde...

In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...

View resource
2 Vital keys to Remaining Competitive for Professional Services Firms

2 Vital keys to Remaining Competitive for Professional Services Firms

3y

2 Vital keys to Remaining Competitive for Professi...

In recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...

View resource
Turn Accounts Payable into a value-engine
Accounting Firms

Turn Accounts Payable into a value-engine

3y

Turn Accounts Payable into a value-engine

In a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...

View resource
Digital Links: A guide to MTD in 2021
Making Tax Digital

Digital Links: A guide to MTD in 2021

3y

Digital Links: A guide to MTD in 2021

The first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...

View resource