I don't really buy that. If CFO and auditors are doing their job any reasonably competent business professional can provide adequate oversight. If the board member isn't capable of adequate oversight the problem lies with the financial information they are being given, very rarely the board members.
You're not really providing much oversight if you're only able to detect problems when they're pointed out to you.
Enron's audit committee was later criticized for its brief meetings that would cover large amounts of material. In one meeting on February 12, 2001, the committee met for an hour and a half. Enron's audit committee did not have the technical knowledge to properly question the auditors on accounting questions related to the company's special purpose entities. The committee was also unable to question the company's management due to pressures placed on the committee.[59] The Permanent Subcommittee on Investigations of the Committee on Governmental Affairs' report accused the board members of allowing conflicts of interest to impede their duties as monitoring the company's accounting practices. When Enron fell, the audit committee's conflicts of interest were regarded with suspicion.[60]
I think Enron is actually a good example of what I mean. I maintain that any generally competent professional can have any legitimate accounting practice explained to them. "I don't get it, tell me where these numbers are coming from," will pretty much suffice. Enron's audit committee simply failed to ask the questions (due to laziness or conflicts). Enron's special purpose entities were sitting in the SEC filings waiting to be found by anyone. As soon as the WSJ reporters asked about them Enron started to implode. The SPEs did not make sense and they fell apart without much more than "wtf?"
Needing financial engineers on your audit committee is a giant red flag that your financials don't make sense.
I think you make a good point, but it still leaves open the idea that groupon may have made these changes to combat a (perceived) weakness in the committee.
"Groupon needs a new audit committee with much more financial expertise," said James Post, a management professor at Boston University.
http://articles.chicagotribune.com/2012-04-12/business/chi-g...