There's no doubt lawyers advised the holding companies that there may now be possible legal risks in disclosing individual agency data. Under the new law, and in this climate of financial scrutiny, the holding companies would be required to provide accurate figures in accordance with generally accepted accounting principles. In doing so, some of the pro-forma figures provided in previous years might be exposed as inflated.
A cautious attorney may advise this could expose a company to accusations of having overstated revenue and misled the investing public in the past. But to hide behind the Sarbanes-Oxley Act, which is designed to promote honesty and transparency in financial reporting, claiming it stops the agencies sharing their data does not tell the whole story. Rather some may be hamstrung by the fear that past overstatements would be exposed, while others were simply happy to avoid dissecting ad agency data after a difficult year for the industry.
Given the importance the ad industry attaches to Advertising Age's Agency Income Report, it's clear a blackout on data is no answer. The ad industry needs a commitment from the holding companies to find a new way to report agency financials. A way could be found if there was a will.
There is a will at Advertising Age. We will publish our 59th annual Agency Income Report as planned on April 21, using a proprietary methodology developed over a number of years. In fact, we're excited at the prospect of getting a clearer picture than ever of the agencies' performances.