PracticeAccounting FirmsSEC launches probe into Walt Disney

SEC launches probe into Walt Disney

The Walt Disney Company is currently under investigation by US regulators over employment relationships between the company and relatives of several independent board members.

Link: AOL faces probe over revenue claims

According to Associated Press reports, the inquiry is not related to the company’s finances, but has to do with an August amendment to its 2001 year-end report, which revealed that three Disney’s independent board members had grown children employed by the company in recent years.

A fourth independent board member’s wife is employed at Lifetime Entertainment Television, a cable network half-owned by Disney.

Disney is believed to be co-operating fully with this investigation, according to AP.

At the same time the entertainment group has launched a series of long-expected corporate governance moves designed to strengthen independence, including the appointment of a new independent director and a new presiding director.

In addition, former Seagram vice chairman and chief financial officer Robert Matschullat has been appointed to the board, making him chairman of Disney’s audit committee.

The company has performed poorly of late – its latest film Treasure Island generated just $12m in its opening weekend, after $140m was spent in making it. As a result the value of the film has been significantly reduced

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