PWR - Director Resigns, page-3

re: PWR - Raid Still waiting for details to be posted on the net.


about beeping time............


ASIC raids PWR Tues PM, Director Dealing, KAZ Also mentioned.




other ASIC news
ASIC chairman David Knott has written to chairman of all listed companies inviting them to directly to involve their boards in ensuring their accounts are clean and they comply with accounting standards.

He argues there's no reason to believe that abuses such as those recently uncovered in the USA are prevalent in Australia. But he says targeted surveillance will help maintain confidence in the reliability of public company financial reporting in our market.

ASIC is putting together a special taskforce with representatives from ASIC's Office of Chief Accountant and from its Corporate Finance and Enforcement directorates. It is also likely to outsource some of the work. The taskforce will report preliminary findings by 31 December 2002.
ASIC's going to be paying close attention to companies that capitalise or deferring expenses and whether they're recognising future revenue in the current year.

(On this, there's a legitimate question over whether ASIC has adequate resources. Its yet to replace its Chief Accountant Ian Mackintosh who left in June to join the World Bank. And the federal Government hasn't yet replaced deputy chair Jill Segal who left to run the ACCC competition inquiry.

But where does a bit of massage to put the best shine on the numbers end and out and out rorts begin?
Former Big Four accounting firm auditor and expert witness, John Shanahan says, a partner with Spencer Stuart & Co, says some of our best known companies are adept at massage the numbers to put the best gloss on their results.

One example from John Shanahan: Qantas. It capitalizes software development costs, capitalizes deferred expenditure (which made just under 10% of its after-tax profits last year) and books deferred losses on hedges - (the loss has happened but you haven't recognized the expense as yet) as receivables. Hardly a paragon of accounting virtue, says Shanahan.

Shanahan says the broader issue is that new accounting standards are so "long, complex and barely comprehensible even experienced accountants have difficulty with them." Its debatable he says whether audit committees have the requisite knowledge, let alone shareholders.

Aside from the question of some nifty massage work of the numbers, there's are plenty of companies who will just plain disappoint. The Australian Shareholders Association has sent out a please explain to 40 companies it classes as under-performers over three years. The list is based on those whose total rate of shareholder return (that's the total annualised return, based on a composite of share price, dividends and imputation tax credits) For further information, go to [wwww.asa.asn.au/PoorPerformers.aspÃ