WASHINGTON-In an address to the Credit Union Executives Society's Public Policy Institute, NCUA Chairman JoAnn Johnson told participants that federal credit unions should consider guidance and periodically evaluate policies and procedures related to corporate governance and auditing. Though the Sarbanes-Oxley Act does not apply to credit unions legally, the non-profit financial cooperatives would be wise to take their cues from it, she said. "As credit unions grow and diversify their operations, governance will continue to emerge as a significant issue for credit union board of directors and management," Johnson explained at the May 5 conference. "It is vital that boards of directors are fully aware of their responsibilities, and likewise, management should maintain operating policies and practices that are fully in compliance with regulations and the Federal Credit Union Act." She outlined that credit unions should consider the provisions relating to accounting, auditor independence, corporate responsibility, and enhanced financial disclosures. "It is not only about practices to comply with the law, but a continuous process to maintain consistent safety and soundness of the member-owned institutions," Johnson stated. The chairman recommended that credit unions go home and bone up on NCUA's Letter to Credit Unions on the provisions of the Sarbanes-Oxley Act of 2002, available at http://www.ncua.gov/letters/2003/03-FCU-07.pdf, as well as the included enclosure. -

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