Sarbanes-Oxley
Enron. Tyco. Global Crossings. Adelphia. Reports of corporate scandals evoke strong emotion from shareholders and government officials alike. What do they mean for university administrators? A briefing paper from the National Association of College and University Attorneys suggests that the federal law enacted by Congress in response to these corporate accounting scandals will impact colleges and universities.
In short, the authors of this briefing paper anticipate the following:
- closer scrutiny of institutional transactions and relationships by board members
- more vigilant enforcement and oversight by state agencies
- more rigorous review of financial statements by institutional auditors
- significant impact on the ethical obligations of all corporate counsel
The authors conclude with the recommendation that "institutions may also wish to apply specific review procedures to major transactions to ensure compliance with applicable law governing non-profit organizations, and strengthen procedures for monitoring the application of restricted gifts and endowments."