Is Transparent and Accurate in Financial Reporting

Is financial reporting transparent? According to our 2015 Survey, respondents shared that accurate (93%), clear (88%) reporting was important in measuring JUST investor/shareholder treatment.


SEC Filings Review

Description: Transparency and accuracy in SEC filings, comprising assessments of whether:

  1. a regulator initiated enforcement action against the company in the past two years; a regulator initiated enforcement action against a director or officer of the company in the past two years; or the company, or any of its directors and officers, are currently under investigation by a regulatory body. Enforcement action covers a wide breadth of circumstances, for example, freezing of a company's assets, fines, probationary periods of any sort, or any other action taken by any regulatory body under any jurisdiction in which the company operates.  The value shown here will be True even if the cause of the action has been remediated;
  2. the company's independent auditor issued an adverse opinion in the past year;
  3. the company disclosed any material weaknesses in its internal controls in the past two years;
  4. the company made non-timely financial disclosure filings in the past two years; and
  5. the company restated financials for any period within the past two years.

Each of these five data points awarded a value of 2 if True and summed.

Data Source(s): Institutional Shareholder Services (ISS)
Metric Type: Performance
Geography: Global
Unit of Measurement: Score (0-10)