Accountants’ Employment Remains Secure - In the midst of rising unemployment rates, it seems as though accountants’ jobs are secure. Although the U.S. unemployment tops 6%, accounting professionals have only a 2.5% jobless rate. Trends indicate that there’s a gap of people with four to five years of experience, giving those professionals unprecedented leverage - particularly when it comes to negotiating life/balance issues.

We peruse the Internet headlines so you don’t have to. Here are the recent SOX and GRC headlines (and links) we felt are newsworthy:

SEC Outlines Compensation Disclosure Challenges Resulting from Bailout - John White, who directs the Corporate Finance Division of the Securities and Exchange Commission, warned that companies participating in the $700 billion rescue package might face disclosure challenges when it comes to executive compensation. The bailout’s restrictions on so-called "golden parachutes" - now limited to $500,000 per senior executive - may even impact non-participating companies, in that their disclosures may need to include salary restructuring that resulted from the economic crisis. White also noted that the SEC would examine the annual reports of the nine largest U.S. banks as part of its SOX-mandated selective review program.

PCAOB Proposes New Risk Rules - In an effort to highlight the integral nature of fraud and risk assessment to the auditing process, the PCAOB has proposed seven new auditing standards. The standards incorporate improved risk assessment methodologies and integrate risk assessment standards, while coming into greater alignment with those developed by the International Assurance Standards Board and the U.S. Auditing Standards Board. The proposed standards are open for public comment until February 18, 2009.

U.S. Firms Pressured to Reduce Power of CEOs - Among corporate governance activists, there’s an increasing demand for a "separation of powers" in the CEO and chairman roles. While European companies typically have a different person filling each role, in slightly over half of U.S. and Canadian companies, the same person is both CEO and chairman. The activists, who are looking to mutual funds to take the lead in urging the split, argue that many of the companies that have gone under or faced problems during the stock meltdown had dual-role leaders at the helm.

Employee Ghosts Haunt Your System - Just as the Powell Doctrine calls for a threat to national security, use of overwhelming force, and a clear exit strategy before going into battle, those engaged in IT risk management need to develop and implement a plan to mitigate the risk left behind by former employees. Deleting accounts and files poses a minefield of legal compliance issues; removing access and tracking data access provides no meaningful information; and the unknown detritus of employees gone bad could derail you. The solution? A centralized ID management strategy that defines roles and privileges ahead of time. This gives you the force and exit strategy you need to mitigate threats to your company’s security.

The recent securities pact between the United States Securities and Exchange Commission (SEC) and the Australian Securities and Investment Commission is seen as a step towards the SEC’s goal of globalizing investing. In another step towards achieving this goal, the SEC has now floated a plan that could require U.S. companies to switch to international accounting standards starting in 2014 and permit others to make the switch even sooner. The switch to international standards could be staggered starting with large U.S. companies in 2014, followed by mid-sized companies in 2015, and small companies in 2016.

A small group of large companies could begin using the standards as early as next year. To qualify, the company must be among the 20 largest companies in its industry and a large number of its competitors would have to already be using the international standards.

Companies switching to international accounting standards would make it easier for investors to compare companies operating in different regions. It also makes it easier for companies to raise capital in whatever market seems most attractive.

There could be many roadblocks which the SEC will have to overcome before the plan can be implemented. There are already concerns about how the transition will occur and how uniform the accounts will be. U.S. companies and auditors will have to learn new accounting rules.

The international accounting standards are set by the International Accounting Standards Board. Whether all countries accept the standards set by the Board is a different issue. Countries have asserted that they have the right to approve or modify the standards issued by the Board. The European Union has allowed banks to ignore parts of the standard. The SEC hopes to deal with this by accepting filings using international standards only if it complies fully with the Board issued standards.

Problem would crop up if the Board issues a rule that the SEC believes is wrong. If the U.S. Financial Accounting Standards Board considers such a rule, the SEC can overrule it.

The plan, if approved, could result in a wholesale change in the U.S. accounting rules. There are many issues on which the international rules are silent. In many cases, the international rules will require more professional judgments from auditors.

Accounting firms have welcomed the SEC’s plan. They look upon the plan as the best opportunity to achieve the goal of a single set of high quality standards around the world.

Until the Sarbanes Oxley Act was passed in 2002, the U.S. Financial Accounting Standards Board was financed by contributions from companies and accounting firms. The Sarbanes Oxley Act gave the Financial Accounting Standards Board the right to levy charges on public companies. This was necessary to assure its independence. Now where does the International Accounting Standards Board get its financing? The answer – the same sources where the U.S. Financial Accounting Standards Board got its financing before the Sarbanes Oxley Act. The switch could depend on the Board getting an independent and stable source of financing.