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Mr. Gupta goes to Washington

Parveen P. Gupta

It may have taken him a few weeks, but Parveen Gupta is finally beginning to understand how Washington, D.C. operates.

He’ll have the remainder of the academic year to learn a lot about the U.S. Securities and Exchange Commission (SEC), the regulatory agency responsible for reigning in corporate malfeasance.

It’s there, inside the Beltway and within the SEC, where Gupta just began a one-year leave of absence from Lehigh to serve as an academic accounting fellow with the agency’s division of corporation finance.

For Gupta, there’s no better place to be.

“It’s an incredibly exciting opportunity for me,” said Gupta. “The position is designed so that I can explore a lot of different interests, and I certainly don’t want to limit myself while I’m here.”

Gupta’s charge is to help the commission tackle timely business issues like management reporting on internal controls, an issue addressed under the Sarbanes-Oxley Act of 2002. He’s also being asked to investigate unusual corporate accounting, auditing and financial reporting questions.

For example, he’s already begun to scrutinize financial statements and public company filings for financial improprieties.

For Gupta, it’s a natural progression from the classroom to the regulatory environment.

Currently, Gupta is an associate professor of accounting with Lehigh’s College of Business and Economics. He teaches a spectrum of accounting issues ranging from corporate governance, to risk management, to corporate financial reporting (which he teaches to Lehigh’s graduate business students).

A truly innovative professor

He’s been recognized by his peers in higher education for teaching these subjects in rather unconventional ways. This past year, Gupta was honored with the highly prestigious Innovation in Accounting Education Award from the American Accounting Association for his “Corporate Governance and Business Risk” course, taught to students enrolled in Lehigh’s Masters in Accounting Program.

And this spring, Gupta conducted a research study for the Institute of Management Accountants (IMA) on Internal Control Reporting under Section 404 of the Sarbanes-Oxley Act. The research study is scheduled to be published by the IMA sometime during early fall 2006.

IMA plans to use the findings of Gupta’s research to develop a risk and control assessment framework for public companies. It will provide leaders in corporate management with practical and cost-effective guidance on how best to comply with the much talked-about internal control reporting requirement under Sarbanes-Oxley legislation.

If it sounds a little intimidating, it is. That’s why top-notch academics like Gupta are being asked to work more collaboratively with industry and the regulatory organizations.

“In the wake of financial scandals and the recent controversy surrounding stock options back dating, the U.S. accounting profession is under increased scrutiny,” said Gupta. “As academic scholars, we need to pursue more contemporary and managerially-focused research that reveals practical solutions for industry and our regulatory bodies.

“We’re trying to promote and to enhance financial transparency and corporate governance in companies that are raising capital in U.S. markets,” he added.

So Gupta’s appointment with the SEC is especially timely.

“Parveen’s appointment is great news for Lehigh and its College of Business and Economics,” said Tom Hyclak, interim dean at the college. “More than anything else, this is an indicator of the expertise of our faculty and their ability to do state-of-the-art research—research that is meaningful for public policy and business practice.”

But the implications for learning inside the classroom are just as significant to Hyclak.

“It’s really a wonderful learning opportunity that will benefit his students and colleagues on his return,” Hyclak added. “He’ll be in a great position to be a thought leader on corporate governance and Sarbanes-Oxley regulation, two incredibly important and timely issues that future business leaders—our current students—will have to live by.”

Gupta is just one of five academic fellows joining the SEC for the 2006-2007 academic year, but he is the only fellow to partner with the agency’s division of corporation finance.

--Tom Yencho

Posted on Thursday, August 24, 2006

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