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COPYRIGHT 2005 American Institute of CPA's
CPAs are beginning to see some familiar faces in corporate boardrooms--including their own. Until recently, most boards were made up largely of CEOs of other organizations. In the past few years though, board members' backgrounds have become more diverse, and more CPAs are serving as directors, in part because of concern over corporate fraud and other accounting and auditing issues. The Sarbanes-Oxley Act requires all public companies to have an audit committee made up solely of independent directors. All members must be financially literate, and the company must identify at least one "audit committee financial expert" or explain why it doesn't have one.
This new rule should have resulted in large numbers of companies adding board members with these skills, particularly former audit partners and current or former CFOs. That hasn't happened yet, but I believe this will change and more such appointments will follow in the next five years. In this article I'll share my experiences as a corporate board member and explain some of the dos and don'ts for CPAs who want to join the ranks of accountants heading to the boardroom.
A SEAT AT THE TABLE
I joined my first board in the fall of 2001, and I'm now a member of three: Kimberly-Clark Corp., Legg Mason Inc. and MCI Inc. (formerly WorldCom). I am chairman of the audit committees of all three companies and also serve on the governance/ nominating committees of two.
Being a board member has been the most interesting experience of my professional career. I get involved with a broad range of business matters and have the opportunity...
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