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Re: Corporate Pollution Prevention Financial Auditing

It is the obligation under law for publicly traded companies not to
misrepresent their assets to shareholders under SEC regulations.

Environmental liability is not the sole criteria for reporting the impact of
pollution prevention infrastructure investments on operating assets .

I disagree with your contention "when it comes to P2, I would guess none of
this would apply."

Corporations investing in pollution prevention infrastructure must report
these expenditures to shareholders and their financial impact on the
depreciation and volatility status of assets.

Companies choosing to depart from full transparency of operating expenses
(including environmental liabilities, toxic torts, depreciation and
volatility estimates for assets) are misrepresenting corporate assets and
violation SEC reporting regulations.

That includes departing from investing in pollution prevention
infrastructures being used in the market place.

Corporations have SEC mandates to report estimated operating costs on long
lived assets for pollution prevention infrastructure investments and not
misrepresent not only corporate environmental financial performance but
overall corporate performance as environmental issues are integrated in all

The issue of financial auditing and liability reporting is not limited to
costs for cleanup programs but to overall corporate operating assets and
their depreciation and volatility estimates.

Best Wishes,
Donald Sutherland

-----Original Message-----
From: Callahan, Mike <Mike.Callahan@Jacobs.com>
To: p2tech@great-lakes.net <p2tech@great-lakes.net>
Date: Wednesday, December 06, 2000 9:08 PM
Subject: RE: Corporate Pollution Prevention Financial Auditing

>You raise some interesting points but I think it's much more complex than
>just a conflict of interest for the auditing firm. It is my understanding
>that environmental liability does not have to be reported unless there is a
>reasonable estimate of the cost. Once a cost estimate has been established,
>then this cost must be reported to the SEC and the company must secure
>funding to cover cleanup costs.
>This creates a major paradox. One company can stick it's head in the sand
>and operate for years with some unknown liability "out there." If they
>establish what their liability is, then they don't need to report and set
>aside cleanup funds. Another company can spend money to study their options
>and to establish what their future liability might be. For this effort,
>get hit with a major operating expense that can put them out of business.
>When it comes to P2, I would guess none of this would apply. Is it your
>contention that companies should report how much they could save if they
>would invest a little more? The issue of auditing and liability reporting
>seems to be much more intended for cleanup programs. I will be interested
>hearing what others say about this subject since it is one that is often