Wonky Accounting Insight in 140 Characters or Less: The FASB Is Now on Twitter
Technically it’s the Financial Accounting Foundation that has the handle: @FAFNorwalk and it also includes anything the GASB but really the FASB is who we expect to go on the offensive here.
They’ll be able to take on the haters with pithy commentary, give us the latest on their (less) ambitious convergence efforts and maybe, if we’re really, really, really lucky Bob Herz will spin off his own version of @CrankyKaplan. @DisturbedHerz, perhaps?
We have hope.
Friday Footnotes: KPMG’s ESG Conflict; PwC Fails to Deliver; FASB Turns Attention to AI | 3.3.23
Big 4 How auditing giant KPMG became a global sustainability leader while serving companies accused of forest destruction [International Consortium of Investigative Journalists] The firm vouched for an Indonesian company with a supply chain beset by deforestation allegations and a project in Canada that led to an Indigenous forest’s “death by a thousand cuts”. ‘Happy […]
BKD Poaches Someone From FASB and Issues a Press Release
It’s fairly common for midtier accounting firms to raid the Big 4 to fill managing director, principal, and partner positions. We’ve seen it happen several times since May. Dixon Hughes Goodman did it, not once but twice. Blumshapiro did it. So too did Andersen and Mazars USA. Hell, even RSM and Grant Thornton have done […]
Sorry, Public Companies, the FASB Isn’t Giving You Any More Time to Get Your Shit Together on Lease Accounting
The chairman of the Financial Accounting Standards Board crushed any hopes public companies might have that the FASB would delay the Jan. 1, 2019, start date for its new lease accounting standard. At #AICPA conference, FASB Chairman Russ Golden is asked: Considering system challenges, new guidance, auditor concerns about #internalcontrols, will #FASB delay #leases standard? […]
Accounting News Roundup: GE’s Non-GAAP Accounting and Turnover at the FASB | 11.16.16
Non-GAAP worries It seems that some people are still worried about non-GAAP accounting, but they're not as worried as they used to be. This Wall Street Journal story reports that the SEC looked at GE's non-GAAP reporting and decided they should point out a few things: In correspondence between the SEC and GE from June […]
FASB Vows to Hit the Gym, Stop Smoking, and Stick to Other Resolutions in 2015
Alright so I lied, FASB isn't going to quit smoking. What they are doing, however, is laying out their goals for 2015 for all of us to see. Chairman Russ Golden writes: I’d like to share with you how we plan to “get it done” in 2015—how we’ll build upon the successes of 2014 while […]
Accounting News Roundup: Deloitte on Top Again; Farewell, KPMG; FASB Delays a Delay | 01.29.15
Deloitte retains top spot among "Big Four" accountants-survey [Reuters]Bragging rights go to Uncle D: "Deloitte has retained top spot among the world's "Big Four" accountants, a survey showed on Wednesday, noting those leading firms had so far retained their grip on the audit market in the face of regulatory changes designed to boost competition." Yahoo's […]
Twitter’s Latest 10-Q Is a Perfect Example of Why No One Wants New Lease Accounting
We all know Twitter — like a lot of "successful" tech companies — isn't exactly making profits hand over fist despite decent revenue but did you know how bad their lease situation is? Spoiler alert: it's bad. In their latest 10-Q filed with the SEC a few days ago, we find the following: So total […]
IASB Chairman to Take His Accounting Standards and Go Home If FASB Doesn’t Want to Play
Hans Hoogervorst doesn’t sound at all passive aggressive here or anything:
Accounting News Roundup: New York Hits PwC Subpoena; Twitter and the JOBS Act; Grant Thornton CEO Gets a Close-up | 09.13.13
2 Consultants to Banking Industry Come Under Scrutiny [DealBook]New York State has subpoenaed two consulting firms as part of a broader investigation into the industry’s perceived coziness with Wall Street, according to people briefed on the inquiry. The two firms that received the subpoenas in recent months — Promontory Financial Group and PricewaterhouseCoopers — are […]
Footnotes: A Revenue Recognition Transition Group; Twitter’s Tweet Break; Will Tax Reform Come to Blows? | 07.26.13
London court orders Grant Thornton to release reports in Tchenguiz suit [Reuters] Twitter Getting $22 Mil Tax Break for Helping Charities Tweet [VW] FASB and IASB to Form Revenue Recognition Transition Group“Revenue is a key performance indicator and is important to every business,” said IASB chairman Hans Hoogervorst in a statement. “Our joint transition group […]
Footnotes: You May Now Follow Tax Reform on Twitter; Jim Turley on the Boy Scouts’ Gay Ban; Let’s Go 990 Hunting | 05.09.13
Taxreform.gov and @simplertaxes are here for your viewing and following pleasure. [via DMWT] Ernst & Young's Jim Turley on the Boy Scouts Reassessing Their Gay Ban There are many challenges to the current policy. It’s not in keeping with the thinking of the majority of Americans. And I don’t think it will lead the Scouts […]
Accounting News Roundup: FASB Joins New Club; PwC Slips in UK Auditor Ranking; MID Reform Options | 03.19.13
Cyprus Set to Reject Bailout, Citing Tax on Bank Deposits [NYT]Cyprus’s Parliament is likely to reject an international bailout package that involves taxing ordinary depositors to pay part of the bill, President Nicos Anastasiades said Tuesday, despite a revision that would remove some objections by exempting small bank accounts from the levies. Lawmakers were scheduled to […]
ANR: Basel Gets Butthurt By FASB Loan Loss Rules; Eat the Rich; Sokol Gets Off | 01.04.13
Acting Ed. note: Guess what, kids? NO COLIN TODAY! YAY!!! I'll be holed up at the Secret Lair surrounded by cats pumping out accounting news for your entertainment all day so feel free to shoot me an email or harass me on Twitter to keep me company. It gets real lonely on troll duty around […]
Accounting News Roundup (Observed): More on PwC and Colonial Bank; FASB Assigns GC Responsibility; Making the Jump From Controller to CFO | 11.12.12
Just like your friends at NASBA, we're observing Veterans Day here at GC so posting will be on the light side. If anything interesting happens while we're gone, be sure to get in touch. Grover Norquist: Mitt Romney painted as ‘poopy head’ [Politico]“The president was elected on the basis that he was not Romney and […]
Surprising Absolutely No One, FASB Pushing Back Their Convergence Timeline
Floored. Just floored.
Financial Accounting Standards Board chair Leslie Seidman said that many of the priority projects slated for convergence with the International Accounting Standards Board probably will not be settled until next year at the earliest.
Les will have all you haters know that this adjusted timeline has been well received by those that are taking this shit seriously:
This is a real process with real outreach and real consideration of the issues that have been raised. And the fact of the matter is that it takes time to work through these issues. The changes which we have made to the timetable, which we have made jointly with the IASB, have been very well received among the constituents who take this process seriously. They are very supportive of our strong commitment to making sure that we end up with improved standards here that are going to stand the test of time.
So if you were expecting Fisher Price accounting rules, you can forget it. These beautiful babes will be used to line up the debits and credits when Spacely Sprockets finally breaks ground.
FASB’s Convergence Timeline Moves to Next Year [AT via Jim Peterson]
Accounting News Roundup: More Convergence Drama; Washington’s Crackhead Accounting; Twitter’s New Digs in the Heart of San Francisco Dope Fiend Territory for a Tax Break | 08.02.11
Moody’s: IASB, FASB Accounting Standards Proposals Hitting Delays [PropertyCasuality360]
Proposed changes to insurance-contract accounting standards are running into delays amid vocal opposition, but whatever final conclusions ultimately emerge, they are unlikely to have a broad impact on credit ratings since new rules, by themselves, do not alter the economic position of an entity, according to Moody’s.
Official Washington’s Crackhead Accounting [The American Spectator]
There is no evidence that this bizarre deal of questionable e.g. the “Super Congress”) will actually lead to any real cuts. Nor is there any evidence that it will prevent the U.S. government from losing its long held triple-A credit rating. There is a promise of spending cuts, but overall federal spending will continue on its upward trajectory because Official Washington operates in the make-believe world of “baseline budgeting.” According to this crackhead accounting, both a cut and an increase may count as cuts.
State faults Binghamton’s accounting system [Sun-Bulletin]
The City of Binghamton’s accounting system lacks adequate controls to provide an accurate picture of city finances, an audit by the state comptroller’s office found. The 33-page report, released Monday, said the municipality has, among other things, overstated its general fund balance, has a city comptroller that hasn’t properly monitored certain accounts and has more than $13,000 in unaccounted funds from its parking operations.
Barclays to cut 3,000 jobs as profit drops [Reuters]
Barclays is set to cut about 3,000 jobs this year to reduce costs after a drop in bond trading and an insurance mis-selling charge cut first half profits by a third.
Money Funds Have Biggest Redemptions This Year Amid Debt Talks [Bloomberg]
Investors last week pulled more money from money-market mutual funds than any week this year as U.S. lawmakers failed to resolve the impasse over raising the debt ceiling. Withdrawals reached $37.5 billion, with about 70 percent of the redemptions coming from institutional funds that invest in U.S. government securities, according to data from the Investment Company Institute, a Washington-based trade group.
Accounting Departments Drive Demand for Electronic Document Management Solutions to Improve Bottom Line, According to IntelliChief [Benzinga]
IntelliChief LLC, the leading provider of document management and imaging solutions for the IBM i (System i, iSeries, AS/400), reports accounting department personnel are often both primary drivers and first adopters of paperless solutions in their companies. “Because of the cost savings to be gained by going paperless in accounting, and the bottom-line responsibilities that are top-of-mind with financial professionals, it makes sense that the demand for paperless solutions most often originates from within the accounting department,” says Brian Smith, IntelliChief Marketing Director.
No Day in Court for Bank Clients [WSJ]
Some small and regional U.S. banks are prohibiting unhappy customers from taking their complaints to court or joining class-action lawsuits, instead requiring them to resolve disputes through arbitration.
Preparing for New ‘Bottom Line’ on Leases [Memphis Daily News]
Obviously, the more significant a company’s leasehold interests are, the greater the impact of the new guidelines; for example, airlines, manufacturers and retailers. Additionally, regulatory rules will likely be impacted for banks and insurance companies. And, because the new guidelines deal with the accounting for leases on the balance sheet, the greatest impact will be on companies issuing audited financial statements.
How Not to Get Unfollowed on Twitter
The last time I attempted a “How Not to Be a Total Asshat on the Internet” public service message in this arena, I was torn apart for being too harsh so I’ll leave out the specifics and stick to the suggestions. You know who you are.
Keep in mind that what works for some doesn’t work for others and vice versa; we’re specifically talking about how to fit in with the accounting crew, not alienating clients, not come off as too spammy and/or maintain a reasonable professional profile using your Twitter account as a point of contact to your brand. All of you are more than welcome to do whatever you want with your Twitter accounts, the following is meant for professionals or brands.
Actually interact – No one is suggesting you follow every person who follows you or go on some mass following spree to artificially inflate your Internet popularity for appearance’s sake but a good balance of @s with following shows some level of interaction. A lot of firms miss this one and organizations can make the mistake of focusing strictly on their own message and ignoring what others are saying. Don’t do that, jump in and say something.
If the thought ever crosses my mind that you might be a robot, you’re probably not doing it right – You know the one; they have the same not-quite-normal headshot as their avatar and profile shot for every hot social media service available and not a single candid pic of this person “in action.” We don’t suggest drunken Facebook shots to remedy this but it would be nice to confirm that the person behind the account is, in fact, a person with a tweet that doesn’t seem prefabricated or a picture that deviates from the Headshot Series 1. When it’s a little too perfect, it appears suspect. People are less likely to enjoy your message if they are too busy wondering whether or not you’re a machine when reading it.
There is a such thing as TMI – I’m guilty of this one and it’s because I’m really not trying to masquerade as a total professional. Nor am I representing my company when I’m out there tweeting about the crackheads hitting on me at the gas station or meter maids terrorizing me with parking tickets. For some, interacting goes too far and gets way too personal. If you are attempting to represent or have at all associated yourself with your company, be aware that there is still a such thing as privacy. Even if you are only followed by a handful of people, your tweets reach the entire Internet.
RTs and FFs – And please for the love of Bob Herz don’t thank everyone for every RT, nor be the “all day #FF” guy. If you’re spending half your Friday #FFing everyone, you’re A) making unnecessary noise and B) diluting the value you add by suggesting helpful people to follow. Stick to a handful if you’re going to do it all instead of spewing out half your following list.
Oh and auto DMs? They were never really cool and to me they say that you’re too busy to actually say anything to me and inconsiderate of how cluttered my inbox can get. Sorry if this offends anyone who is in love with their own “brilliant” auto DM but I see them as obnoxious. Add to the conversation, not the noise.
FASB Chair: Yeah, We’re Not Meeting That June 2011 Convergence Deadline
Yes, that’s your shocking headline of the day. Despite the retripling of efforts via videoconferencing and other fancy-schmancy technology, some Frenchman losing patience, and having a Knight spearheading 50% of the efforts, they will utlimately fall short of the June ’11 goal.
We know. Catch your breath or place yourself back in your chair, and then you can read Emily Chasan’s account from Reuters:
The Norwalk, Connecticut-based FASB and the London-based International Accounting Standards Board expect to announce changes to their convergence work plan in the next week or so that would delay the completion date by about six months and allow for greater public comment on the boards’ proposals, FASB Chairman Robert Herz said in an interview with Reuters.
“We’ve been working on a revised work plan with the IASB,” Herz said.
“We’d all like to see the work done as expeditiously as possible, but we don’t want to sacrifice proper due process.”
Herz said that to issue final standards by June 2011, the boards would have to release about 10 proposals in the next two months and rush through the public comment process.
It was nice of the FASB and IASB to say, “June? No problemo,” to the G20 BSDs but many organizations, including Financial Executives International, and even Chief Accountant Kroeker said that the overachieving might lead to some shoddy accounting standards.
Mr Herz is still optimistic about finishing up before 2012 telling Reuters that the two Boards will “get most if not all of [the accounting standard proposals] done by the end of 2011,” which is probably enough time for IFRS to be adopted by everyone. But then the world is on a strict deadline to end in 2012, so why are we bothering with this again?
FASB’s Final Word on Fair Value Disclosures?
Editor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
Of the 111 comment letters FASB published on Fair Value Measurements and Disclosures: “Improving Disclosures about Fair Value Measurements”, this one was my favorite:
Please don’t require Companies not SEC registered to spend any more money on reports under this rule.
Lloyd Amundson
Amen, brother.
The usual suspects left the usual complaints; BDO said excessive disclosures would be both costly and useless, Uncle Ernie implied it was an interesting concept but an expensive flop in practical application, and PwC prefers once a year disclosures instead of quarterly.
Verizon even got in on the action, insisting, “proposed additional extended sensitivity disclosures would unnecessarily complicate financial statement disclosures without providing any meaningful benefit to financial statement users.”
I think it is entirely reasonable to point out that FASB is feeling the pressure to converge and the IASB is encouraging slightly less optimistic financial statements. The IASB openly admits that it is under outside pressure to adopt such a stance:
Responding to requests by the G20 leaders and others, in June 2009 the IASB published a Request for Information on the practicalities of moving to an expected loss model. The responses have been taken into account by the IASB in developing the exposure draft.
The IASB continues:
The IASB will also cooperate closely with the US Financial Accounting Standards Board (FASB) with a view to agreeing a common approach to the impairment of financial assets.
Since when is this for the IASB to decide?
Political influences are nothing new to accounting rulemakers but what happens when those influences come from foreign bodies far outside of our control? It is a known fact that the European Union has a large stake in IASB, so how can we be sure their intentions are pure as we move forward at their urging?
The Financial Crisis Advisory Group, an international body set up by the IASB and FASB to advise them on standard-setting issues related to the financial crisis, warned recently that that political pressure on accounting standard-setters posed a threat to “the very existence of international accounting standards.”
Integrity in financial statements? Keep looking, not going to find any of that here.
A FASB Override Button?
Editor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
Over the weekend, I covered an obscure financial reform proposal that may mean taking away final responsibility of accounting standard-setting from FASB a f “emergency” switch for use solely in situations of undue financial stress. This type of “escape hatch” might be familiar; the practical application of the Fed’s 13(3) rule left the door wide open for Bear Stearns and AIG.
In regards to Meet the FASB Override Button, I received a note from reader Ron with the simple rhetorical question:
Do you think a system this corrupt can survive in its present form?
He even gave me an out, qualifying the email with “No need to reply.”
Well thanks, Ron, but how in the hell am I supposed to ignore a loaded question like that?
In the article, HuffPo calls it “Civil War in Corporate America”:
Amid the ongoing financial regulation overhaul, the banking industry is hoping to pull off a quiet power grab that has eluded its grasp since the Great Depression, by stripping the independence of the board that sets financial accounting standards.
The mechanism is contained in an amendment set to be introduced in mid-November by Rep. Ed Perlmutter (D-Colo.) that would move final authority over the Financial Accounting Standards Board (FASB) from the Securities and Exchange Commission to a new body, a so-called “oversight” board, that would include the officials charged with managing systemic risks to the financial markets.
The Center for Audit Quality came back with a nasty letter to Barney Frank — among others — insisting that accounting setters must remain independent (implying that they have been all along). I assume that the CAQ has forgotten about FAS 157-e by now.
So do I believe in financial reform at this point? No, and I can’t say I ever did. Did I ever believe we could duct tape our way through recovery with a little accounting magic and some confident words from Tim Geithner? Yeah right.
And that therefore betrays my opinion on saving our financial system in its current form. FASB merely exists under the guise of independence, and while European accounting standard setters have a far worse reputation when it comes to allowing themselves to be politically swayed, something must change moving forward.
I doubt that an emergency FASB override button is a step in the right direction to that end.
But if they’re trying to sneak in accounting standard escape hatches, that means something must be working correctly with the currently regulatory framework – they wouldn’t be looking for ways to bypass it if it was totally useless.
Past GC coverage of Congress meddling in accounting rules:
Congress Needs More Testimony on Accounting Stuff They Won’t Understand
Barney Frank Doesn’t Legislate Accounting, He Only ‘Exerts Pressure’
Newt Gingrich Doesn’t Like the FASB
FASB Does Apple a Giant Solid
Editor’s note: Adrienne Gonzalez is founder and managing editor of Jr Deputy Accountant. You can see all of her posts for GC by going here. By day, she teaches unlicensed accountants to pass the CPA exam, though what she does in her copious amounts of freetime in the evening is really none of your business. Follow her adventures in Fedbashing and CPA-wrangling on Twitter @adrigonzo but please don’t show up unannounced at her San Francisco office as she’s got a mean streak. Her favorite FASB is 166.
Holy crap, wait a minute, is FASB trying to do something useful?
If you’re the sort of person annoyed by having to pay for software updates for your iPod, then perhaps. As with anything FASB does, intention and practical application are always two distinct and not necessarily related items. It remains to be seen whether or not this frees Apple of the strange accounting noose critics of the FASB rule claim has stifled sales.
Continued, after the jump
If you’ve ever been irked at the small charges you’ve had to pay for an iPod touch software upgrade, this may be about to go by the wayside. According to Ars Technica, a rule governed by the Financial Accounting Standards Board, that’s been heavily lobbied for by Apple and other electronics companies, may be enough to lift the charge that iPod touch owners have had to pay for updates of significant features to their devices. The rule focuses on “subscription accounting”, or devices that gain “significant new functionality” after their sale, like the iPhone, have to be reported over a series of years rather than all at the same time (presumably because the revenues associated with the product were the result of a series of updates, not just one lump sum).
(source)
Those same critics (or the financial reporting nerds, we’re not sure) claim that Apple has technically been underreporting its iPhone earnings as a result of this rule, a reversal of which would fortify Apple’s balance sheet of steel. That’s great for Apple, I suppose.
The rule is as yet in comment draft form, so go nerd on over to FASB and tell them what you think.
Does this mean billions in iPhone revenues will have to be restated going back to 2008? Rub it in, why don’t you?
This is where it gets really magical.
Stefan Sidahmed via Seeking Alpha:
The projected EPS really shows the true impact of the iPhone on Apple’s earnings. The FY10 EPS of $16.80 includes $4.02 in deferred income, so the ‘real’ EPS would be $12.78, more than double FY09 projected GAAP earnings. Likewise, the FY11 EPS contains $1.92 of deferred EPS. This should not be interpreted as Apple doubling their EPS, but rather that their current EPS is artificially suppressed by subscription accounting.
Good news for them and maybe FASB has at last done some good. Guess we’ll see when the deferred earnings run out.
Dear FASB, I’m Breaking Up With You
Editor’s note: Adrienne Gonzalez is founder and managing editor of Jr Deputy Accountant as well as regular contributor to leading financial/investment sites like Seeking Alpha and GoldmanSachs666. By day, she teaches unlicensed accountants to pass the CPA exam, though what she does in her copious amounts of freetime in the evening is really none of your business. Follow her adventures in Fedbashing and CPA-wrangling on Twitter @adrigonzo but please don’t show up unannounced at her San Francisco office as she’s got a mean streak. Her favorite FASB is 166.
I can’t take it anymore. I’m serious, this is BS. It has been nothing but up and down, agony and ecstasy for as far back as I can remember on fair value and I want off this ride.
More agony, after the jump
The Financial Accounting Standards Board’s updated fair-value rules will require companies to fully understand fair-value and mark-to-market concepts and extensively document their analysis of illiquid assets, as this article notes. The FASB gave companies some new latitude in applying fair-value principles but stood firmly behind the importance of fair value in preparing meaningful financial statements.
Stop, please. This is getting to be abusive.
Remember when you whispered in our ear, “Certainly, to those who say that accounting should better reflect true economic substance, fair value, rather than historical cost, would generally seem to be the better measure” in 2003, Bob Herz? We totally fell for it. Who wouldn’t? Swept off of our feet and still hurting from Enron, we needed a rebound and fair value totally worked.
Now what?
I truly wish you and IASB the best of luck in whatever you two decide to do with your miserable little lives.
WebCPA:
While FASB may be pushing back in the other direction and mulling the use of fair value and mark-to-mark with bank loans in addition to assets like mortgage-backed securities, the IASB seems to be tacking in an alternative direction. That could be leading them on the road to divergence, not convergence.
And I’m defriending you on Facebook, Bob. At least you know your new girlfriend does fair value.
Love,
AG
Friday Footnotes: CPA Exam Scares Accounting Majors Away; EY Loses Fees in China | 5.12.23
Footnotes is a collection of stories from around the accounting profession curated by actual humans and published every Friday at 5pm Eastern. While you’re here, subscribe to our newsletter to get the week’s top stories in your inbox every Tuesday and Friday. See ya. Talent Why Graduates Aren’t Hot on Accounting Careers: Low Starting Pay, […]
Monday Morning Accounting News Brief: KPMG Vet Quits on Christmas; PwC Resigns; ‘A Veil of Legitimacy’ | 1.16.23
An accountant used his position in the accounting department of the Volunteer Energy Cooperative (VEC) in Tennessee to steal nearly a million dollars, he used a refund scheme to transfer money into his personal checking account and make payments to his credit cards and his wife’s credit cards. A discussion about money laundering in Australia: […]
Friday Footnotes: EY Money Troubles; Fast Food > Public Accounting; From Athlete to Associate; | 12.16.22
Big 4 EY Looks at Backup Plans on Split Amid Higher Costs, Slower Growth [Wall Street Journal] Ernst & Young’s leaders are looking at backup plans for the firm’s split to address rising funding costs and a potential slowdown in growth that could imperil the rich payouts promised to partners, according to people familiar with […]
Friday Footnotes: Behemoth Big 4 Firms Get Behemothier; Audits Get Harder; Eliminate Clients! | 11.11.22
Ed. note: if you like accounting news, which you clearly do because you are reading this, we encourage you to sign up for our newsletter for even more accounting news. Oh and a hearty thank you for your service to the veterans out there. Hopefully some of you got the day off. Hiring ‘There’s definitely an […]
Monday Morning Accounting News Brief: The Diversity-est Big 4 Firm; An EY Record; PCAOB Stream | 10.17.22
EY’s Manchester office hired the most students of all EY’s UK offices; the Manchester office recruited 104 new students, the firm recruited a record 1,473 students into its UK business this year (up 35% compared to 2021). 32 leading industry commentators, CEOs, CFOs and board members from across the world have contributed their views on […]
Friday Footnotes: Crippling Staff Shortages in Consulting; Hold Auditors Accountable; AICPA is Mad | 8.12.22
Ed. note: fans of accounting headlines are encouraged to sign up for our newsletter to get headlines delivered to your inbox twice a week. Looking for a remote accounting job? We encourage you to sign up to get job alerts for remote accounting positions from our friends at Accountingfly. Now, the news. How to follow up […]
Friday Footnotes: A World Without Accountants; GAO Finds a Big Mistake; ‘Fazbie’ | 8.5.22
Ed. note: are you obsessed with accounting news? Yeah, us too. Sign up for our newsletter to get headlines in your inbox twice a week. Looking for a remote accounting job? We encourage you to sign up to get job alerts for remote accounting positions from our friends at Accountingfly. If the world had no accountants […]
Friday Footnotes: A CPA Grindset We Can Get Behind; The Klynveld Krypto Team; Firms Still Desperate (For People) | 6.24.22
Accounting Firm EY Grapples With Partner Pay, Bear Market in Breakup [Wall Street Journal] Ernst & Young’s leaders, trying to persuade partners to split up the firm, said windfalls would be spread evenly, but a bear market threatens to cut the value of a potential initial public offering of its consulting business, according to an […]
Friday Footnotes: Accounting AI Explodes; SOX Compliance Sux; KPMG Gets on a List | 6.17.22
The 2022 Client Advisory Services (CAS) Benchmark Survey is now open for participation [CPA.com] Participation in the CAS Benchmark Survey provides an opportunity for you to work on your business – first, by reviewing the data about your practice in preparation to take the survey, and later, when you can review your practice’s data compared […]
Friday Footnotes: EY Gets Extra Empathetic; Broke KPMG Partner Sues; Auditor Pay Cuts? | 5.27.22
Accounting Giant EY Created A Chief Wellbeing Officer To Uplift And Empower Their People [Forbes] EY investing in that empathetic leadership everyone loves so much. Bankrupt former KPMG partner sues law firm over job loss [Financial Times] A former KPMG partner who went bankrupt after investing in French ski chalets is suing law firm Herbert […]
Friday Footnotes: ‘KPMG Did Not Know What They Were Doing’; Are You Boring?; PCAOB Warns About Confirmations | 3.25.22
These are the 5 most ‘boring’ — and exciting — jobs in the world, according to a recent study [CNBC] You’ll be happy to hear accounting made #2 on the most boring list. Don’t feel bad, MY job ranked #3 most exciting and I assure you it absolutely is not, I write about accounting after […]
Friday Footnotes: Deloitte’s Naughty Workpapers; Audit Reform Critics; Clients Getting Dropped Like Mics | 3.4.22
Deloitte considers Russia pull out as pressure grows on western firms to exit [Financial News] Deloitte is considering pulling out of Russia, becoming the first Big Four audit firm to do so as pressure grows on Western companies to cut ties with the country following its invasion of Ukraine. The firm is reviewing its “business […]
KPMG Poaches Someone From Deloitte and Issues a Press Release, Part I
Competitive poaching of PPMDs among midtier accounting firms has been rampant lately, whether they are taking people away from the Big 4 or from other midtier firms. Even the FASB isn’t immune from being poached. While watching the hiring games these firms are playing is fun and all, we’ve been patiently waiting for some Big […]
RIP James Schnurr, Former SEC Chief Accountant
The SEC confirmed last night some sad news we saw being shared on Twitter yesterday that former Chief Accountant James Schnurr has passed away. SEC Chairman Jay Clayton said in a statement: “Jim was a dedicated and respected public servant who left us far too soon. While at the Commission, he was committed to establishing […]
Get Yer Pointin’ Fingers Ready, We’re Looking Back on the Financial Crisis Ten Years Later
I got a notification from Twitter the other day reminding me that it’s been 10 whole years since I joined. Wow, that long? I realized that I’d done it the week the economy started swirling down the drain in earnest back in 2008. Unlike my Twitter anniversary, we can argue all day over the actual […]
Accounting News Roundup: Insurance Fraud and Tax Reform Gets Harder | 11.16.17
Accountants behaving badly Here’s an interesting diversion in the ABB section from the usual “Accountant Embezzles Funds” story: insurance fraud! An Atlanta-area CPA, Earle Turner Sr., allegedly took out 19 life insurance policies on his clients, naming himself as the beneficiary: Mutual of Omaha notified Georgia officials of suspected fraudulent activity by Turner after finding […]
Accounting News Roundup: Tax Reform; GM Dumps Deloitte for EY; Fax Machines | 09.28.17
How’s tax reform coming along? The Trump Administration is making progress on tax reform, people. Back in April, officials released a one-page set of bullet points. Yesterday, after months of hard work, Trump and Congressional Republicans presented “Seven pages of general highlights and a disturbing absence of detail” according to Tony Nitti. No matter how you […]
Accounting News Roundup: Rhode Island Is Mad at Deloitte and WWDJTD About Non-GAAP Accounting? | 01.13.17
Rhode Island is mad at Deloitte The Boston Globe reports that Deloitte has run aground on another state government project, this time in Rhode Island where a new system "has been beset by technical problems, causing thousands of delays in distributing food stamp benefits." This has gotten the attention of the governor, Gina Raimondo: "Clearly […]
Accounting News Roundup: Talent Solutions and PwC’s Diversity Training | 12.08.16
Accounting firms are worried about talent What's a non-Big 4 accounting firm desperate for warm bodies to do? Excellent question! Although not being an awful place to work is a pretty good idea, a few firms are trying more practical things. According to this Accountingweb article by Jeffrey McKinney, some are finally using internships while […]
Accounting News Roundup: Cloud Revenue, Leases and Bank Fraud | 06.06.16
Accounting for cloud revenue One of things that's been established is that creative accountants get ahead. That is, when someone asks, "What was net income?" the accountant who responds, "Net income was X," gets a "Thanks." The accountant who responds, "What do you want net income to be?" gets a promotion. This seems to be […]
Accounting News Roundup: EY Guy Gives Advice and CFO Worries | 03.31.16
EY! EY's global CEO Mark Weinberger gave an interview to Australia's Financial Review where he dropped some wisdom about skills and stuff. The global professional services firm, which is holding its global partner meeting in Sydney this week, is bracing for a major upset in its workforce and marketplace over the next decade. "Whatever you're […]
Friday Footnotes: Another Andersen?; What Employees Want; Bald(ing) Accountants | 12.11.15
May the footnotes be with you, capital market servants. Drop us links and tips over the weekend by hitting the button at the top of the page or emailing us directly. Follow us on Twitter, Facebook and Pinterest. Submit questions, career conundrums and #AuditorProud moments to Open Items. Jim Peterson's book is out and he […]
Accounting News Roundup: Non-Audit Services; Brutal Work Competition; Internal Auditors Suck at Tech, Too | 08.18.15
Non-Audit Services Fee Cap: How Would U.S. Companies Measure Up? [Audit Analytics]Pretty well, actually! Audit Analytics found that fewer than 200 companies in the Russell 3000 exceeded the 70% threshold. Work Policies May Be Kinder, but Brutal Competition Isn’t [NYT]In my imagination, a clever NYT editor's first suggested a title of: "People Trying to Get […]
Friday Footnotes: Accounting for Derivatives; Grant Thornton’s People People; Dealing with Downtime | 08.07.15
Have a great weekend, capital market servants. Send us tips, comp info and epic farewell emails by hitting the button at the top of the page or emailing us directly. Follow us on Facebook, Twitter, Pinterest and post your questions, conundrums and rants in Open Items. FASB Proposes Changes in Accounting for Derivatives [AT] Intent, […]
Friday Footnotes: Gay Marriage Wins; How Uber Conquers; Rand Paul vs. IRS | 06.26.15
Have a great weekend, double-entry mavens. Drop us stories and tips by hitting the button at the top of the page or emailing us directly. Follow us on Facebook, Twitter, Pinterest and write your accounting opus in Open Items. Supreme Court Rules in Favor of Same-Sex Marriage [AT] Sexism & Public Accounting [r/accounting, Earlier] Deloitte […]
Friday Footnotes: More AMA with Halliburton Whistleblower; Disrupting Lease Accounting; Nice Dadbod | 05.01.15
Have a great weekend, capital market servants. I'll be on vacation for most of next week but you'll still get content from the likes of Greg, Leona and others. Send tips and stuff we should know to our inbox, follow us on Twitter, Facebook and remember that Open Items is like 7-11. Reddit Recap: A Q & A […]
Accounting News Roundup: Good-Bye to the Indirect Method?; Like-Kind Exchanges in the Art World; Info for Your Next EY Trivia Night | 04.27.15
FASB Proposal May Foreshadow Changes to Cash Flow Rules [CW]The new non-profit rules just issued eliminate the indirect method for the cash flow statement. FASB Vice Chairman James Kroeker wants to do the same for businesses. Tax Break Used by Investors in Flipping Art Faces Scrutiny [NYT]You can't stop Section 1031 like-kind exchanges, you can […]
Friday Footnotes: PwC Settles Over MF Global; EY on Big Data in Auditing; Late-Night Emails | 04.17.15
PwC to pay $65 million to settle suit over MF Global [WSJ] Post-Busy Season Quiz: What Would You Do Differently? [AWEB] House votes to repeal estate tax [The Hill] Noble Group Shareholders Challenge Management on Accounting [WSJ] New FASB standards keep focus on simplification [JofA] House quietly passes tax exemption for megadonors [Politico] EY Sees […]
Accounting News Roundup: FX Accounting Saves the Day; ‘All the strippers wanted to study accounting’; Dealing with Interruptions at Work | 02.03.15
Russian accounting changes soften the earnings blow at BP [Fortune]In Mother Russia (and anyhwere using international standards), foreign currency exchanges accounting: "Analysts had expected a massive write-down of the value of BP’s Rosneft stake to reflect both the collapse in oil prices at the end of 2014 and the equally dramatic collapse of the ruble […]
Accounting News Roundup: KPMG’s New Atlanta Boss; No One Wants Simpler Accounting; Treasury Secretary Gets Bogus IRS Calls | 01.23.15
Americans' Satisfaction With Federal Taxes on Low Side [Gallup] This required a survey? "Americans' satisfaction with the amount that Americans pay in federal income taxes roughly ties the lowest percentage Gallup has seen in the past 12 years. Thirty-two percent are now satisfied, down from 38% a year ago, but similar to the 33% found […]
Accounting News Roundup: Talk About Culture Some More; Deloitte Fights Back; KPMG’s Latest Money-Making Plan | 10.01.14
SEC Charges Two with Insider Trading on Pershing Square’s Announcement on Herbalife [SEC]The SEC’s orders find that Filip Szymik of New York City and Jordan Peixoto of Toronto engaged in insider trading in Herbalife securities in advance of hedge fund manager William Ackman’s December 20, 2012 announcement of the views of his hedge fund, Pershing […]
Accounting News Roundup: KPMG Scrutinized for Espirito Santo; Going Concern Disclosures; Life at Deloitte Includes Getting the Gym All to Yourself | 08.28.14
KPMG Faces Criticism for Espírito Santo Audit Work [WSJ]Given BDO's experience, maybe the HoK should've seen this coming: "In KPMG LLP's Lisbon office, few clients provided as much audit work as the Espirito Santo Group, whose business interests ranged from banking to mining. Now the collapse of the family-owned empire is raising questions about whether […]
Accounting News Roundup: Lew Wants Inversion Party Stopped; FDIC Claims Against PwC Over Colonial Bank; Unplugging on Vacation | 07.16.14
U.S. Seeks Legislation to Curb Offshore Tax Deals [Bloomberg]Treasury Secretary Jacob Lew would like Congress to get on this, chop chop: "The Obama administration called for immediate congressional action to stop U.S. companies from using cross-border mergers to escape the country’s tax system, the latest trend in corporate deal-making. In a letter calling for a 'new […]
Accounting News Roundup: Grant Thornton’s Next CEO Has a Plan; When Accounting Inspired Art; Get Yourself a Cheerleader | 06.09.14
A Risk-Taker’s Game: Insider Trading [DealBook]I wonder if Phil Mickelson knows the over/under on KPMG's PCAOB failure rate: "Mr. Mickelson has been dogged for years by speculation about whether his gambling is a passion or a problem. 'Phil’s the kind of guy who will bet you his luggage comes off the airport carousel first,' Bob Verdi, […]
Footnotes: Speeches, Awards, and Beards OH MY | 05.29.14
Speech by Hans Hoogervorst: 'Charting progress towards global accounting standards' A highlight: "The new Revenue Standard replaces American standards that contain thousands of pages of application guidance and IFRS Standards that provide too little guidance. The fact that we managed to stay converged with our colleagues of the FASB is very important and we intend […]
Investors Want Disclosures That Make Sense; Also a Pony, World Peace
This according to Compliance Week: “Investors pretty much said to a person they're not turning down disclosure,” says Kenneth Daly, president and CEO of the National Association of Corporate Directors, which recently convened an investor summit to hear from major investor groups. “At the same time, they made it abundantly clear, there are lots and […]
Footnotes: Thar Be Jobs, Kids!; Regulators Heart Big Data; Another Celebrity v Accountant | 02.21.14
Securities Regulators Go Big on Big Data [CFO Journal] TGIF for normal people, this for Footnoted [Twitter] Help! My filings cup runneth over! — footnoted (@footnoted) February 21, 2014 If you're looking to get hired in Portland, maybe check here [Portland Biz Journal] And hey look, they're doing it in Baltimore too. [Baltimore Biz Journal] […]
Footnotes: Bring on the 10Ks; Don’t Bet on Herbalife; HFTs Need a New Source | 02.20.14
GrubHub Seamless Joins the Tech IPO Crush GrubHub Seamless Inc., the online restaurant-menu and takeout-ordering service, has made a confidential filing for an initial public offering, according to people familiar with the matter. Company officials have met with investment banks and could launch the IPO as soon as the first half of the year, one […]
Accounting News Roundup: Tax Shaming Corporations; Grant Thornton Explains Busy Season; Mount Rushmore, Tax Prof Edition | 02.19.14
Blaming Big Corporations Is Not the Answer [Tax Analysts]David Brunori is sick of the tax shaming: "American companies making profits overseas have little reason to bring the money home. Their keeping money overseas to escape taxation is rational. Making IBM out to be the bad guy — which other media reports also have done — […]
Accounting News Roundup: Goodwill Testing for Private Companies; Detroit’s New CFO; Who Loves Key Shortcuts? | 11.22.13
Goodwill Testing May Soon Get Simpler for Private Companies [CFOJ]Emily Chasan writes that the FASB is trying to squeeze some things before the holiday, "The Financial Accounting Standards Board is set to decide on Monday whether to endorse changes proposed by its new Private Company Council that would let private firms choose to amortize so-called […]
Accounting News Roundup: Get With It, Audit Committees; States That Cut Taxes in 2013; Newsflash: Bank Execs Are Paid Well | 11.21.13
Audit Committees Urged to Be More Transparent [CFOJ]If the National Association of Corporate Directors, Center for Audit Quality and Association of Audit Committee Members are to be believed, "there is a 'growing trend' among audit committees to provide more information," and if committees are slacking on that, "they should regularly offer investors details about their […]
Footnotes: A Dirty Accountant; PwC’s Lipper Problem; Crowe’s Chief Innovation Officer | 11.08.13
An Italian named Paolo Oliverio might be the most corrupt accountant in history. [Economia] PwC ordered to face fraud claim over Lipper hedge fund collapse [Reuters] Here's an exposure draft from the AICPA on changes to compilation engagements. [AICPA] Make donations to typhoon victims via U.S.-based nonprofits [DMWT] I don't know why I think this pictures is […]
Accounting News Roundup: Rich People Tax Problems; Big 4 Mad Men; Secret PCAOB Investigations Protects Bad Auditors | 11.08.13
Strategic moves [Economist]The Economist gets all smarty pants on auditors acquiring consulting shops. Higher Tax Rates Give Top U.S. Earners Year-End Headaches [Bloomberg]Shucks. That's too bad. Thanks to audit firms, Math Men are taking over Madison Avenue [Quartz]Someone else noticed the two acquisitions by Deloitte and PwC in the past month or so. Bad auditors […]
Footnotes: SEC Gets Around to Sherb & Co.; New Revenue Recognition in the Final Stretch; Decent Internships | 11.07.13
CFOs Need to Learn About Tax Credits [CFO] FASB Finishes Talks on Revenue Recognition [CW] Gerald A. Poynter, also known as "Brother Jerry Love," admitted to leading a tax fraud conspiracy in which co-conspirators from eight states filed fraudulent tax returns seeking $96 million in refunds. The IRS mistakenly paid out $3.5 million of those refunds […]
Footnotes: It’s Goin Down in Brazil; PriceBoozHouse FTW; Are You Drunk Or Are You Just Dumb? | 10.30.13
OGX Bankruptcy Filing Caps Batista’s $30 Billion Demise [Bloomberg] HEY YOU GUYS! We recorded the tiniest budget deficit in 5 years thanks to record revenue! Um. Wait… what? [Businessweek] Which iPhone you choose says a lot about you, but mostly it says whether you pee standing up or sitting down [Mashable] This piece tries to […]
Footnotes: Duke and Deloitte; Crtl+Alt+Del; ‘An exceptional enforcement record’ | 09.26.13
UHY Advisors is looking for auditors in Houston, Texas. [GCJ] Duke and Deloitte, together. If this doesn't make you naseous then see yourself out. Welcome back, @lifeatdeloitte! Together we're helping students become future business leaders. #MBA #recruitment — Duke Fuqua (@DukeFuqua) September 26, 2013 Bill Gates admits Control-Alt-Delete was a mistake [The Verge] "Any objective […]
Accounting News Roundup: See? Fair Value for Loans Isn’t So Hard; Stock Options on Life Support; How Capital Gains Fight Figure in Tax Reform | 08.28.13
EBay-Style Lender Has Better Way of Keeping Books [Bloomberg] [A] few years ago, the U.S. Financial Accounting Standards Board issued a proposal to require fair-value accounting for loans on corporate balance sheets. The banking industry howled that it was too difficult to come up with market values for loans, that the numbers wouldn't be reliable […]
Footnotes: NASBA Grant Winners; California Hasn’t Imploded; Can’t Spell ‘Emmy’ Without EY! | 08.22.13
Tough Mudder has an open Senior Business Analyst position in Brooklyn. [GCJ] Nasdaq Resumes Trading After Outage [WSJ] The IASB’s Quixotic Attack on Disclosure “Boilerplate” [Accounting Onion] Tyco Challenges $3 Billion IRS Adjustments for Loans [Bloomberg] Researchers at Notre Dame, Bryant, and Mississippi State Universities have been awarded grants by NASBA. […]
Footnotes: Sour on Cider Taxes; Tesla Has a Non-GAAP Revenue Line; Building a Worthwhile Career | 08.07.13
Avid needs a Corporate Accounting Manager. Seven years experience, CPA preferred. [GCJ] Hard Cider Treated Like Beer Becomes Endeavor of Senators: Taxes [Bloomberg] FASB Proposes to Define Public Business Entities [AT] Elon Musk Does Not Accept Your Accounting Principles [Slate] TSLA non-GAAP to GAAP reconciliation: http://t.co/GWiwCPM3fA — zerohedge (@zerohedge) August 7, 2013 How to Build […]
Accounting News Roundup: Koss Settles with Grant Thornton; Deloitte’s Summer Shopping; Max & Dave Start Their Road Trip | 07.08.13
Koss settles claims against former auditor Grant Thornton [MJS]Koss Corp. collected $8.5 million from Grant Thornton, the accounting firm that audited Koss' books during a portion of the time that Sujata "Sue" Sachdeva was stealing millions from the company. […] "I don't think it is possible to look at the size of the settlement and conclude […]
Footnotes: Andrew Fastow’s Confessions; Spain Putting the Screws to Deloitte; AICPA Is Just Trolling PCC, Now | 07.02.13
Greenlee needs a Financial Analyst in Rockford, Illinois. [GCJ] The confessions of Andy Fastow [Fortune] FASB and IASB Plan Roundtables on Leasing Proposals [AT] Spain Presses Deloitte on Bankia Work [WSJ] FASB Fine-Tunes Footnote Disclosure The board proposes to make management responsible for assessing whether a company can continue as a going concern. But how […]
ANR: Madoff’s Suggestion for Improving Audits; More PCAOB-China Progress in the Works?; Old Public Accounting Ideas That Don’t Work | 06.06.13
Madoff’s 5 best ideas to make markets fair [MW]Includes: "Accounting firms should audit other accounting firms. — Accounting firms should be enlisted to check on their peers, which would make sure audits have been conducted properly, suggested Madoff. 'But these firms use the excuse of competition. If accounting firms keep each other in check, a proper […]
Accounting News Roundup: Apple’s Irish Star; Lots of Support for Special Prosecutor in IRS Scandal; Virginia’s Sheep Tax | 05.30.13
The US/China audit deal: will it work? [FT]Signing the MOU (which can be terminated by either party on a mere 30 days’ written notice) is a clever and diplomatic way to separate the wheat from the chaff. Those Chinese companies with truly nothing to hide will be the ones that remain publicly listed on US […]
Accounting News Roundup: The New Lease Accounting Exposure Draft Is Here; PCAOB Deal with China?; This Accountant Love KFC More Than You | 05.16.13
IASB and FASB Propose Changes to Lease Accounting [FASB, ED]The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) today published for public comment a revised Exposure Draft outlining proposed changes to the accounting for leases. The proposal aims to improve the quality and comparability of financial reporting by providing greater transparency […]
Footnotes: Acting Commish Knew About Targeting in 2012; A Pirate Accountant; Banks Have a Suggestion for Loan Loss Accounting | 05.13.13
IRS: Top Official First Told of Targeting in 2012 [AP] I.R.S. Focus on Conservatives Gives G.O.P. an Issue to Seize On [NYT] Europe Eases Corporate Tax Dodge as Worker Burdens Rise [Bloomberg] CAQ Advises PCAOB on Audit Quality Indicators [AT] Sales Tax Talk and Reality [Economix/NYT] Germany Arrests Alleged Somali Pirate Accountant German police arrested a […]
Accounting News Roundup: ‘Stupid is as stupid does’; Takin’ It Easy with New Revenue Recognition; PCOAB’s Hanson Looking for Perfect Auditors | 05.03.13
U.S. Economy Adds 165,000 to Payrolls [WSJ]U.S. job growth picked up in April and the unemployment rate ticked down again, suggesting steady but still-measured economic growth. Employers added 165,000 jobs last month, the Labor Department said Friday. The unemployment rate, obtained by a separate survey of U.S. households, fell one-tenth of a percentage point to 7.5% […]
Footnotes: Boy Scouts Coming Around to Jim Turley’s Point of View; Read Bob Herz’s Book; Taxing Ice Cream Cakes in Wisco | 04.19.13
The Boy Scouts seem to have come around to Jim Turley's point of view on their "no gays" policy. [ABC] Ex-FASB chairman Bob Herz wrote a memoir. [AICPA] Frank Kurre, the new OMP of GT's New York office is getting a masters in pastoral studies. [GT] Here's Wisconsin's explanation of how/when the sale of ice […]
Footnotes: Tax Cheats Not Interested in Personal Responsibility; Connecticut’s Mature Video Game Tax Proposal; Frugal to a Fault | 02.08.13
Posner: Tax Cheats Suing UBS for Not Stopping Them From Cheating Like Suing Parents for Not Raising Them to be Honest [TaxProf] (VIDEO) Move to an S Corp to Save Taxes [Blumer & Associates] Connecticut State Representative Proposes 10 Percent Tax On Mature Video Games [ATL] IIA and Robert Half Present 7 Attributes of Highly […]
Footnotes: California Gov Predicts a Surplus; Illustrating the Fiscal Cliff Deal; We Speaking the Same Accounting Language? | 01.10.13
“I think it is about time [the SEC] took action against the gatekeepers,” said John Coffee, a Columbia University securities-law professor. The SEC has been “somewhat egregious and far less than aggressive” in taking action against auditors, attorneys and other outside professionals who may have abetted the conduct that led to the crisis, he said. [WSJ] […]
Footnotes: The Fiscal Cliff, Dude; Stamford Knows BDO; Resolutions for the Boss | 01.02.12
From NASCAR to rum, the 10 weirdest parts of the ‘fiscal cliff’ bill The fiscal cliff bill renews “special expensing rules for certain film and television productions,” at a cost of some $75 million per year. Studios in Hollywood and elsewhere can deduct up to $15 million of their costs if more than three-fourths of the […]
Footnotes: Most Disappointing Apocalypse EVER | 12.21.12
Oregon Promises Not to Change Tax Code in Nike Agreement [Tax Foundation] As Confusion Reigns, IRS Issues Statement To Employers On 2013 Withholding [Forbes] SEC Names Beswick Top Accountant [Compliance Week] Seidman hopeful for converged expected loss approach despite differing FASB, IASB proposals [Journal of Accountancy] Stone Resigns From Accounting Oversight Board After SEC Claims […]
IASB Chairman Asks G20 Task Force To Turn Up Their Hearing Aids
Accounting rule convergence is dead. I know it. You know it. Hans Hoogervorst knows it. Everyone has accepted the fact that the SEC managed to tell IFRS supporters to stick their principles-based rules where the sun don't shine in the most passive-aggressive way possible. Yes, the IASB is still coming up with pathetic ideas to […]
To Whom It May Going Concern: Looking For a Husband and a Few Good Going Concern Readers
To Whom It May Going Concern is a feature of some of the more, shall we say, interesting messages that come across the wire. If you get the urge to tell us exactly what you think about this here website, email [email protected] with "To Whom It May Going Concern" in the subject line, @ us on […]
Lease Accounting Survey Highlights Growing Demand for Competent Survey Writers
Thank you, readers, for forwarding your spam to us. @going_concern Kindly help me complete this survey on the proposed lease reforms surveymonkey.com/s/LKFDN8P — MachO (@bakersavi) September 24, 2012 The best way to complete the survey is to click the delete button located near the top of your Outlook window. But don't worry. A less optimal […]
Footnotes: Neil Barofsky on Auditors, Tax Credits in Chart Form, IRS Keeps ‘Em Honest | 09.12.12
Neil Barofsky On Bailouts, TARP, and Whether It Was All Worth It “The auditors have proven themselves to me, over and over again, to be more concerned about the steady stream of fees than in doing their job.” [Forbes] SEC whistleblower program stricter than IRS bounty which paid $104 million to felon, former official says [Reuters] […]
The Accounting Ethicist Goes Off the Reservation
If there is a single thing I enjoy about this job, it’s definitely not my esteemed colleague Colin or whatever his name is, but the fact that I get to hang out – and subsequently, get to know – CPAs. Sometimes that’s on Twitter, or speaking at a Stanford class or scurrying through the secret tunnel underneath the Senate and House office buildings. I get to show up late (sorry, the BW Parkway sucks) to Tom Hood addressing a room of young CPAs, asking their opinions on how they want to shape the future of the industry. Somehow I even got invited to Council, and got to see the entire machine in action from the inside, surrounded by CPAs. It’s a pretty awesome gig.
So with that in mind, esome for me to watch a contact sort of deviate from the program. I’ve seen it happen here on GC, the “accounting industry standards” come wandering over here because they want to seem clued in to whatever it is we’re talking about. They’re both fascinated and mortified that we’ve taken accounting to this horrible place. They can’t look away. But they are also so distanced from what we’re doing that they can’t quite grasp the program. Still, they try.
I’m not narcissistic enough to take credit for this but let me just tell you what I saw.
Accounting Ethicist was a project by Seton Hall University Chair of the Department of Accounting and Taxation Mark Holtzman. The project is still there it’s just… uh… changed.
This all started when I inadvertently trolled Mark with a piece by Accounting Onion that accused accounting professors of being poorly assimilated to the idea of blogging. Mark wrote:
I’m sorry to say that accounting doesn’t make for very interesting blogging. See any interesting tax footnotes lately? How ’bout that new FASB proposal? IFRS is already a joke – how many bloggers do we need to point that out? Here comes “Little GAAP.” Is there anything interesting to say about “Little GAAP?” And while I’m at it, have you ever seen the list of topics at a AAA meeting? There could be more accounting professor blogs, yes, but who would want to read all that cr@p?
Right. Who would want to read this bullshit?! To me that’s offensive, I’ve somehow spent the last two years writing about this crap (just swear, Mark, it feels good. You’re allowed to say crap on an accounting blog) and he basically said that my shit is a joke. I know I’ve written some bullshit in my day but every now and then I do genuinely care about what I’m writing about, so it’s shitty to imply that everything I do is too boring for any human being to digest. You CAN make more IFRS jokes, bro, they’re never-ending. It doesn’t have to play out like a fucking AAA meeting, though we’re not against showing up at one of those either. That’s the benefit to having a single location (here) for the profession to behave at its worst (you guys) and just get it out of their systems so they can effectively check those boxes (your job, sorry).
So, at the time Mark got trolled by us, his blog was pretty tame. He asked questions within the agreed-upon “respectable” limit hoping for a reaction. As anyone who isn’t us can tell you, talking about ASCs is not going to make for very lively convo with anyone, even people who are kind of into that tedious shit.
But then just now, Mark has reappeared (as FreakingCPA) dropping such headlines as “Hans off our GAAP!” That’s pretty epic.
In “Why do smart people do stupid nasty things?” he writes:
This obviously has many parallels to the accounting profession. Unfortunately, many accountants and executives have chosen to procrastinate and perpetuate frauds, rather than reveal them. Dr. Kahneman’s research shows that, when confronted with this choice, many people can’t accurately measure the risks.
He admits to reading GC so maybe we did have a small part of this transformation. I can only hope.
Rebranding can be dangerous but sometimes it’s exactly what a non-believer has to do to realize that there are people who do care about this tedious shit, you just have to package it in a way that makes them feel as though they are actually enjoying it.
Accounting News Roundup: Debt Ceiling Deal Delay; IRS Rings Up Bell; IASB Mooving on to Post-Convergence Projects | 07.27.11
Vote on Boehner Plan Delayed Amid Opposition [NYT]
House Republican leaders were forced on Tuesday night to delay a vote scheduled on their plan to raise the nation’s debt ceiling, as conservative lawmakers expressed skepticism and Congressional budget officials said the plan did not deliver the promised savings.
What’s Wrong With America’s Job Engine? [WSJ]
Between the end of 2007 (when American employment peaked) and the end of 2009 (when it touched bottom), the U.S. economy’s output of goods and services fe number of workers fell by a much sharper 8.3%. Today’s puzzle: How and why employers managed to boost productivity, or output per hour of work, like never before during the worst recession in decades?
Americans ‘Disgusted’ as Politicians Fail to Compromise on Debt [Bloomberg]
“They’re not in touch with reality,” said Cheryl Carroll, 51, who lives in Tinton Falls, New Jersey, with her two daughters. She has been applying for jobs in retail and subsisting off her family’s investments since her husband died last year. “They should really get an average American in Congress who knows how to balance their checkbook,” Carroll said. “It would be fixed in a week.”
Obama’s ‘70 million checks’ per month: Actually, it’s even more than that. [WaPo]
The mind-boggling number challenges a common critique of the federal government as a creaky apparatus where tax dollars are lost in the bureaucratic cracks. From the vantage point of the 70 million or 80 million checks, the government is a finely tuned machine that brings in revenue and disperses it back out across the country.
IRS is investigating Bell finances [LAT]
The Internal Revenue Service has opened an investigation into the handling of bonds and employee compensation packages in the financially struggling city of Bell, according to sources familiar with the ongoing probe. At least two IRS agents have been assigned to the investigation and have been in and out of Bell’s red-brick city hall since February, one source said. “They’re sifting and combing through everything,” the source said. The sources requested anonymity because they were not authorized to talk about the investigation.
CPA: Can’t Prepare Anymore [Tax Update]
Definitely not “Current Power of Attorney.”
Employees Can’t Use IRS Computers for Craigslist, eHarmony, Facebook, Foursquare, Gmail, TaxProf, Twitter, Yelp [TaxProf]
Or simply, “Any use that reduces productivity or interferes with the performance of official duties.”
Next Accounting Standard Project: Dairy Cows? [CFOJ]
Bovines at fair value?
ICAEW helps US focus on global standards [Accountancy Age]
International financial reporting standards are in focus at the ICAEW, which is to chair an American Accounting Association debate on the future of the global standards in the US. The panel will include former chairman of US regulator the FASB, Robert Herz, and forms part of the AAA’s annual conference from 6 – 10 August.
Cops: Calif. man tries to fix hernia with butter knife [MSNBC]
The man’s wife called police to say her husband was sick and tired of waiting to get surgery for his rupture and decided to take matters into his own hands on Sunday evening, Glendale Police Sgt. Tom Lorenz told msnbc.com. When officers arrived at the couple’s apartment, they discovered the man, naked and sprawled out on a lawnchair, with a butter knife protruding from his abdomen, Lorenz said. The man was cooperative and even pulled out the knife when asked, he said.
Accounting News Roundup: PwC’s ‘Comply or Explain’ Approach on Female Promotions; Frightening SALT Rates on Cell Phones; Grant Thornton Names CMO | 02.23.11
Private-Share Trade Is Probed [WSJ]
The Securities and Exchange Commission is investigating potential conflicts of interest in the fast-growing market for buying and selling shares of private companies such as Facebook Inc. and Twitter Inc. The move is part of a broadening probe by the U.S. agency, still at an early stage, of the thriving bazaar that has sprung up largely beyond the reach of regulators and traditional securities firms. Trades handled by SecondMarket Inc., SharesPost Inc. and other market makers specializing in privately held shares are conveying eye-popping valuations on some companies while disclos ir financial results.
PwC to proactively promote women [Accountancy Age]
The Big 4 firm will implement a “comply or explain” approach, which will ask division leaders to proactively consider women for promotion or explain what the blockers to progress there are. It said that the emphasis will initially fall on achieving proportionate promotion rates at manager and senior manager levels.
Wells Fargo CFO ‘Well Equipped’: Analyst [The Street]
“Not only is Mr. Sloan personable and candid, but also he is very conversant in many key areas of investor focus,” said Morford in a note describing Wells Fargo’s CFO Tim Sloan after meeting with him last week. Morford said that the 10-K for the company should be filed on time next week and that the company said there were no financial or accounting related issues to the sudden retirement of former CFO Howard Atkins.
Robert Herz, Former FASB Chairman, Joins WebFilings as Senior Advisor [Business Wire]
WebFilings, developer of the first and only end-to-end solution for external financial reporting, announced today that Robert Herz, former Chairman of the Financial Accounting Standards Board (FASB), has joined the company as Senior Advisor. “As a forward-thinking accounting industry leader, Bob brings a unique and valuable perspective to our team,” said Matthew Rizai, CEO of WebFilings. “We are extremely excited to leverage his knowledge and experience as we continue to evolve our industry-leading product and service offerings.”
‘Can you hear me now?’ Your cell phone’s state and local taxes are huge! [DMWT]
Nebraska is your big winner with a state and local rate of 18.64%. New York comes in at #3 with 17.78%.
Harry Reid Says Nevada Should Outlaw Prostitution, Gets Bitchslapped by Whores [JDA]
The lede from TLP, “Did you hear the one about the politician and the hookers? Turned out to not be so funny. Maybe that was because he was trying to fuck the hookers and take their money at the same time.”
Emanuel Wins Big in Chicago [WSJ]
Almost five months after resigning as President Barack Obama’s chief of staff to enter this city’s mayoral race, Mr. Emanuel received 55% of the vote with more than 97% of the precincts reporting, more than the simple majority needed to avoid a run-off campaign against second-place finisher Gery Chico. Mr. Chico, a onetime chief of staff to Mayor Richard M. Daley, received 25% of the vote.
Tricia Conahan named Chief Marketing & Sales Officer at Grant Thornton [GT]
“It is exciting to be joining an organization with a renewed focus on growth,” Conahan said. “I am a passionate believer in the discipline of marketing, and the value that it brings to help grow businesses. I am looking to bringing Grant Thornton’s dynamic vision to the marketplace.”
Archstone Looks Likely to Go Public Again [WSJ]
The sharp rise in the value of rental-apartment buildings is raising the likelihood that Archstone, one of the companies that became a symbol of the commercial real-estate downturn, will be resold to the public this year in what could be the largest real-estate initial public offering ever.
Accounting News Roundup: KPMG’s Hiring Spree in Europe; Herz Gets Nostalgic; Stalemate on Estate Tax Could Benefit States | 10.05.10
KPMG joins Big Four hiring spree [FT]
The FT gives us the scoop on the Radio Station hiring bonanza in Europe (if you’re experienced go here), “KPMG is hiring 8,000 new staff across Europe over the next three years, signalling a recovery in the corporate services industry.
The hiring includes 3,000 staff in Britain, even though the UK government has pledged to cut its consultancy bill amid growing public unease over the billions of pounds spent on professional fees in the past decade.
The recruitment drive will take KPMG’s workforce from 30,0 Europe, excluding France and Italy, and from 11,000 to 14,000 in the UK. KPMG also has ambitious hiring plans in France and Italy.
The corporate services industry had been hit by the global downturn, with the Big Four accountancy firms – KPMG, Ernst & Young, PwC and Deloitte – criticised for their role in signing off financial statements stuffed with assets that plummeted in value during the crisis.”
After Eight Years at FASB, Herz Looks Back [CFO]
Q&A with the man himself. Can you guess which accounting pronouncement he’s a big fan of?
Two Accounting Firms To Pay $1.7 Million To Settle CFTC Charges [Dow Jones]
“The charges stemmed from audits of Sentinel that were conducted between 2004 and 2006. The firms, McGladrey & Pullen LLP and Altschuler, Melvoin & Glasser LLP, agreed to pay $400,000 and $800,000, respectively, in restitution to Sentinel’s customers who suffered losses as a result of the Illinois-based futures commission merchant’s bankruptcy.
They were also required to pay civil monetary penalties of $150,000 and $350, 000, respectively, according to an order that was filed Monday. McGladrey & Pullen acquired assets related to Altschuler, Melvoin & Glasser’s audit practice in 2006.”
Ex-SocGen Trader Kerviel Convicted of Trading Fraud [WSJ]
” Paris court sentenced former Société Générale trader Jérôme Kerviel to three years in prison for his role in one of the biggest trading scandals in history, ordering him to repay a whopping €4.9 billion ($6.69 billion) loss suffered by the French bank.”
Investor Feedback Summary May Foretell FASB Retreat [Compliance Week]
“The Financial Accounting Standards Board may be sending up a smoke signal with an unusual missive describing how investors aren’t entirely in love with the board’s proposed new rules on financial instruments.
The board published a nine-page description of its interaction with investors regarding the FASB’s controversial proposal to call for more fair value in accounting for financial instruments. It opens with a reminder that FASB writes accounting rules to assure that financial statements produce information useful to investors, then explains how investors are reacting to the proposal when the board conducts face-to-face meetings with investors.”
State Estate Taxes: Windfall Gold in Expiring Tax Cuts [TaxVox]
States make out pret-tay well if Congress bumbles the estate tax.
U.S. hits AmEx with antitrust suit [WaPo]
“The Justice Department announced Tuesday that it had filed an antitrust suit against American Express for preventing retailers from offering customers discounts for using rival credit cards with lower processing fees.
Federal officials added that they had reached a proposed agreement with Visa and MasterCard over the matter.
The issue of ‘swipe fees’ has long been a thorn in the side of the retailing industry, which complained that it has little power to inform customers of the differences in card costs. In its complaint, the Justice Department estimated that the fees cost merchants $35 billion each year – resulting in higher prices for shoppers.”
LinkedIn and PwC Launch Breakthrough Career Mapping Tool for College Students [PR Newswire]
“LinkedIn, the world’s largest professional network with more than 80 million members globally, today launches Career Explorer in collaboration with PwC US, one of the largest employers of college graduates in the United States. The new LinkedIn Career Explorer tool provides current college students with unique, data-driven insights to help them build their careers.”
A Shift at the Top of Twitter [DealBook]
“Evan Williams, the co-founder and chief executive of Twitter, is stepping down to lead product strategy at the company, Twitter announced on Monday. Dick Costolo, the chief operating officer, will succeed Mr. Williams.”
Accounting News Roundup: 1099 Reporting Is the Latest Political Football; Financial Reporting Overhaul in the Works?; Zynga’s CFO Hire Spurs IPO Talk | 08.02.10
Parties Play Politics With Unpopular Tax Measure [WSJ]
The new 1099 reporting requi a bit of belly aching to point of many groups asking for a repeal. Too bad the members of Congress are the ones with the power to actually make something happen:
“The House rejected a bill Friday that would have repealed the provision. The two parties disagreed on how to make up the lost revenue.
‘This foolish policy hammers our business community when we should be supporting their job growth,’ Sen. Mike Johanns of Nebraska said in the Republicans’ weekly radio and Internet address Saturday. ‘It’s only one example of how the administration’s promise to support small businesses really rings hollow.’
Democrats blamed Republicans for Friday’s failure.
‘Despite all of their rhetoric about the need to eliminate this reporting requirement, Republicans walked away from small businesses when it mattered most,’ said Rep. Sander Levin (D-Mich.), chairman of the House Ways and Means Committee.”
FASB Alumnus Trashes GAAP (and IFRS) [The Accounting Onion]
“I suspect that the folks being paid the big bucks to make the tough calls on accounting standards don’t pay a lot of attention to to the likes of Tom Whatshisname, even were I to announce that the sky is falling. But, I don’t take it personally. Over the past 40 years, any PhD not drawing a salary from the Big Four has been viewed with more suspicion than respect by the standard setting establishment.
I mention all of this now, because there is a new voice, whose credibility and qualifications cannot be so easily dismissed. That voice belongs to FASB alumnus David Mosso, who has written an 80-page monograph entitled Early Warning and Quick Response: Accounting in the Twenty-First Century). If you don’t want to believe me, take it from him: GAAP is broken.”
Group formed to overhaul financial reporting [Accountancy Age]
Meanwhile: “A project to overhaul company reporting has been launched by a high level group of accountants, businesses, regulators and market participants.
The International Integrated Reporting Committee will look at the wider concerns about financial reporting, in terms of addressing risk, and presenting a clearer and broader picture of companies’ performance, including governance and environmental issues.”
Goldman Details Its Valuations With AIG [WSJ]
“How did Goldman come up with the mortgage-securities prices it used to extract cash from AIG?”
Before There Can Be An IPO, First Comes A New CFO For Zynga [Tech Crunch]
Dave Wehner comes in from Allen & Co. taking the spot of Mark Vranesh who is becoming Chief Accounting Officer. What does all this mean? First, it gives most MSM outlets a day or two worth of stories about when Zynga will go public but mostly it means the business of Farmville, no matter how you hate it, is serious business.
Facebook Would-Be Owner Says He Owes His Claim to Arrest [Bloomberg]
“Paul Ceglia, who claims in a lawsuit that he owns 84 percent of Facebook Inc., said his case wouldn’t have been possible if state troopers hadn’t come to his house in October to arrest him for fraud.”
Forced Employee Engagement and the Overworked Employee [The Exuberant Accountant]
“In my many interactions with business owners, I have heard some speak of employees as being ‘lucky to still have a job.’ While that may be true, thinking (and acting) in such a manner is very short sighted.”
Twitter, Facebook, LinkedIn? [AccMan]
Got business model?
Accounting News Roundup: Bankruptcy Examiner to Investigate WaMu Failure; Ex-KPMG Tax Principal Pleads Guilty; UK Inspector Says Audits Need ‘Significant Improvement’ | 07.21.10
WaMu Shareholders Win Court Investigation of Biggest U.S. Bank Failure [Bloomberg]
WaMu gets their very own Anton Valukas! Colorful claims to come? “Shareholders of Washington Mutual Inc. won court approval of a new investigation of the biggest U.S. bank failure, further delaying the company’s effort to reorganize in bankruptcy.
U.S. Bankruptcy Judge Mary F. Walrath in Wilmington, Delaware, agreed that an examiner should be appointed to review WaMu’s assets, including the value of a potential lawsuit against JPMorgan Chase & Co. and the Federal Deposit Insurance Corp. for their role in the 2008 collapse of Washington Mutual Bank.”
Ex-IRS agent pleads guilty [WaPo]
John Venuti was also with KPMG from 2002 to until this past January. WaPo reports that he was a “tax consultant and principal.”
“According to the plea agreement, Venuti did not file federal tax returns from 2001 to 2006. Each year, though, he requested and was granted a six-month extension, and made a total of $97,060 in payments along with the extension requests. Authorities said he owes more than $789,000 in back taxes.”
Reckitt to Buy Durex Maker SSL [WSJ]
“Pushing further into the lucrative over-the-counter medical market, U.K. consumer-goods firm Reckitt Benckiser PLC agreed on Wednesday to acquire health-care-product company SSL International PLC, in a deal that values the world’s biggest condom maker at £2.54 billion ($3.88 billion).”
FASB Reveals Second Attempt at Standard on Contingencies [Compliance Week]
“The standard differs from one the FASB published in June 2008, which called on companies to use some conjecture and provide estimates of possible outcomes. Corporate counsel in particular buried FASB with objections that the proposed approach would force disclosure of privileged information, especially by giving legal adversaries access to information that would compromise the outcome of disputes. The current proposal steers clear of any requirement for companies to make any predictions or estimates about possible outcomes.”
FTSE 100 audits require “significant improvement”, inspectors find [Accountancy Age]
“Auditors have also been accused of altering documents before handing them to regulators and putting cost savings ahead of quality, in the review by the Audit Inspection Unit (AIU).
The report raised a number of concerns following its inspection of 109 audits from AIM and the FTSE 350.
The report also found some cases where partners signed audit reports before the audit was complete and one instance when an auditor tried to alter an internal file after the AIU requested it. Auditors had also changed internal materiality thresholds, which effectively reduced their workload, and had also not applied enough scepticism to internal asset valuations.”
Fed Governor Duke: Accounting Should Come With Incentives
Editor’s note: Adrienne Gonzalez is founder and managing editor of Jr Deputy Accountant as well as regular contributor to leading financial/investment sites like Seeking Alpha and GoldmanSachs666. You see all of her posts for GC by going here. By day, she teaches unlicensed accountants to pass the CPA exam, though what she does in her copious amounts of freetime in the evening is really none of your business. Follow her adventures in Fedbashing and CPA-wrangling on Twitter @adrigonzo but please don’t show up unannounced at her San Francisco office as she’s got a mean streak. Her favorite FASB is 166.
What do you get when you cross a Federal Reserve governor and the AICPA? Well I wish I could say unicorns and rainbows but really all you get is Fed Governor Elizabeth Duke on, what else, regulation.
Regulatory Perspectives on the Changing Accounting Landscape doesn’t exactly sound like a party but what do you expect? Unemployment is up, revenues are down and let’s face it, things aren’t looking too good for the short term. You’ve got to give Duke some level of credit for trying.
More, after the jump
Firstly, we feel it prudent to point out that Duke is no CPA. She couldn’t tell a debit from a credit if her life depended on it, at least in j/e form, but we’re willing to bet as a banker she’s probably better at sniffing out capital requirements than, say, that brainiac Bernanke.
Given my background as a community banker, I feel it is crucial that an accounting regime directly link reported financial condition and performance with the business model and economic purpose of the firm. It is difficult for me to comprehend the value of an accounting regime that doesn’t make that link.
To be frank, it has been frustrating to try to assess that viability when the value of an asset is based on the nature of its acquisition rather than the way in which it is managed or the way in which its economic value is likely to be realized.
What’s so frustrating about assessing an asset? Either it’s worth something or it’s worthless. Any idiot can figure that out, even yours truly.
Duke implies in her speech that fair value is only useful if the instrument (read: creative and probably entirely made-up security) is being sold or desired by some third party (read: those gullible Chinese who bought all of our weak ass mortgage-backed securities back in the good old housing bubble days) and entirely useless for anything else. In other words, the proof is in the cash flows.
Leave it to a banker to assume that balance sheets are so easily manipulated by instruments passing from buyer to seller and somehow entirely irrelevant in the time in between. As a banker, we expected better from her. Surely she understands that capital requirements dictate those “useless” securities on the “assets” side of bank balance sheets count towards the bank’s overall viability? Apparently not.
In fact, Duke seems to think that fair value can backfire on smaller institutions who may not have the borrowing leverage of, say, a beast like Goldman Sachs. Or better, Lehman Brothers. Before they went bankrupt that is.
All in all, interesting thoughts from the Fed Board on this one but until they pull out someone with practical accounting experience, it might as well have come from Perez Hilton for all I care. Next!
Don’t Raise Those Taxes Just Yet, Timmy!
Editor’s note: Adrienne Gonzalez is founder and managing editor of Jr Deputy Accountant as well as regular contributor to leading financial/investment sites like Seeking Alpha and GoldmanSachs666. You see all of her posts for GC by going here. By day, she teaches unlicensed accountants to pass the CPA exam es in her copious amounts of freetime in the evening is really none of your business. Follow her adventures in Fedbashing and CPA-wrangling on Twitter @adrigonzo but please don’t show up unannounced at her San Francisco office as she’s got a mean streak. Her favorite FASB is 166.
I don’t know about you guys but when I’m trying to avoid spilling the beans, I’ll skirt around the issue as much as possible. God forbid my words come back to haunt me later, it’s so much easier to be as vague as possible.
Turbo Tim Geithner obviously subscribes to this method as well. Skirting around the issue of a tax increase? Our Treasury Secretary has that little song and dance down.
More after the jump
Treasury Secretary Timothy Geithner said in an interview aired Sunday that the administration will do “what’s necessary” to revive the economy, and didn’t rule out new taxes as a means to do so.
“We’re going to have to look at – we’re going to have to do what’s necessary,” Geithner told ABC’s George Stephanopoulos, host of “This Week.”
“Remember the critical thing is people understand that when we have recovery established, led by the private sector, then we have to bring these deficits down very dramatically. We have to bring them down to a level where the amount we’re borrowing from the world is stable at a reasonable level. And that’s going to require some very hard choices. And we’re going to have to do that in a way that does not add unfairly to the burdens that the average American already faces.”
Well what the hell is that supposed to mean? Sounds like a tax increase to me. With our Chinese credit card already cut and record-blowing amounts of Treasury auctions flopping week after week, one can only wonder where we’re going to be forced to make those “hard choices” Geithner is talking about.
Well instead of an across the board tax increase, we have some other ideas for raising the United States’ revenue. Hope you’re listening, Timmy!
• Obama Cabinet bikini car wash on Pennsylvania Ave. – Listen, no one wants to see Larry Summers in a bikini, so maybe the fundraising will come from paying him to keep his clothes on.
• White House yard sale -Taking a cue from California, the White House could put up all those black Secret Service helicopters up for a deep, deep discount. I’m sure they could pull at least $20 a pop for cardboard cutouts of Bill Clinton that have been gathering dust in the basement
• Rent out Ben Bernanke’s industrial strength money printing machine by the hour – Listen, we already know the thing works, why not rent it out to other nations engaged in quantitative easing? I’d say rent it out to Zimbabwe but they might not be able to cover the bill
• FOMC cage match fights at Fedquarters – We’ve all heard about dissent at FOMC meetings but what if we kill two birds with one stone – bring new transparency to the monetary policy-setting process AND pull in $75 a ticket to see “El Jefe” Jeff Lacker take on “Helicopter Ben” Bernanke in spandex and Luchador masks? I know I would pay to see that.
If you’ve got other ideas, we’re all ears. And if none of these work, I guess there’s always legalized prostitution. Though I’m not quite sure how well Tim “Eraserhead” Geithner would do as a man whore… Oh well. Tax increase here we come!
The CPA Exam for Commitmentphobes
Editor’s note: Adrienne Gonzalez is founder and managing editor of Jr Deputy Accountant as well as regular contributor to leading financial/investment sites like Seeking Alpha and GoldmanSachs666. You see all of her posts for GC by going here. By day, she teaches unlicensed accountants to pass the CPA exam, though what she does in her copious amounts of freetime in the evening is really none of your business. Follow her adventures in Fedbashing and CPA-wrangling on Twitter @adrigonzo but please don’t show up unannounced at her San Francisco office as she’s got a mean streak. Her favorite FASB is 166.
The first time I addressed the CPA exam here on Going Concern, I may have given the firms a little too much credit. Keep in mind that I write from the perspective of a CPA Review Project Coordinator; in other words, I’ve heard every excuse in the book.
I need more time on my course. Work got really busy and…
Continued, after the jump
Listen, I understand that the CPA exam is a serious commitment. I also understand that first and second year new hires get worked like slave labor. What I do not understand is why this should be my problem 2 years after the student’s course expired with not a peep in between. Can you use this excuse in college? “Yeah, sorry I didn’t make it to my Final… um, I know it was 3 years ago but can I just take it again? I got really busy.” I dare you to try.
What I’ve learned from my time in the CPA Review trenches – something that I will take with me for the rest of my life – is quite simple. In the time it takes to come up with reasons why you don’t have the energy, time, knowledge, or ability to pass the CPA exam, you could have already passed it.
Yes, you. You could have passed this thing years ago. All of a sudden you’re staring down a promotion and realize that there’s no way you’ll be able to make the leap with that obnoxious colleague who passed the exam in 4 months. How can you possibly compare?
Well you can’t, first of all. Second of all, I’m willing to bet my entire inventory of Wiley CPA Review books that he’s full of shit. So is the guy who said he had an hour and a half left when he walked out of FAR, as is the chick who says she got a 95 on BEC (she’s our student, you know, and she got three 60s before that, not to mention cussed out by me for an hour before she finally passed). They are not you. And you, little CPA exam candidate, are the only person who matters in all of this.
Not your parents, not your boss, not your firm and not even your significant other. You. Is this what you want to do with your life or not?
If it was, you’d be at the Prometric center in full war paint ready for battle 45 minutes before they open, not calling me trying to explain how complicated your life got in the two years since I’ve heard from you. Apparently you forgot that you friended me on Facebook and I can see you filling out 79 quizzes in just three short hours.
What exactly are you waiting for? Time? Trust me, you’ll never have it.
The FDIC May Have to Seize Itself
Editor’s note: Adrienne Gonzalez is founder and managing editor of Jr Deputy Accountant as well as regular contributor to leading financial/investment sites like Seeking Alpha and GoldmanSachs666. By day, she teaches unlicensed accountants to pass the CPA exam, though what she does in her copious amounts of freetime in the evening is really none of your business. Follow her adventures in Fedbashing and CPA-wrangling on Twitter @adrigonzo but please don’t show up unannounced at her San Francisco office as she’s got a mean streak. Her favorite FASB is 166.
In honor of Bank Fail Friday, let’s take a look at our doubt over the FDIC continuing as a going concern. Sure, we know it’s technically a government agency and therefore not subject to the same sorts of worries as public companies but there is certainly something brewing here.
We are not in the business of auditing the financial statements of the FDIC, even if they provided such information. Frankly, if they did, we really aren’t equipped to analyze said statements. Be that as it may, you don’t need to be an expert to see that the FDIC is in a whole shit ton of trouble (yes, that is our qualified opinion).
More, after the jump
Remember Colonial Bank? Surely Sheila Bair has been up late since the news broke on Monday that they’d cooked their books, or something about TARP fraud (though the bank never received TARP funds after that TBW deal for $300 million fell through Friday). Maybe it was undercapitalization? Who keeps track of these things?
Anyway, the point here is that the FDIC well has run dry and there’s no magically conjuring up a Treasury line of credit. While Congress has offered up a $500 billion “line of credit” to our friends at the FDIC, that money technically does not exist. (Psst: hate to break it to Congress but yours truly is only a tad concerned that there may be trouble in the bond market ahead).
I’m no mathlete but this should be fairly simple to understand:
Colonial has about $25.5 billion in assets, while the FDIC has about $13 billion remaining in the fund. According to Sheila’s math, new FDIC fees levied against Too Big to Fail will net the fund about $27 billion this year. To put this into perspective, the FDIC lost $33.5 billion in 2008 to cover 25 bank failures. Add it up, as we’ve had 69 bank failures in 2009 to date. Carry the 1 and I believe we arrive at the following figure: the FDIC is screwed.
Like I said, someone might want to check my numbers but it doesn’t look good.
I could also point out that perhaps the FDIC should have chosen the “proactive” route and collected insurance premiums for the last 10 years instead of assuming the good times would last forever but again, not my jurisdiction.
Disclosure: the author has long since diversified her “investments” in the First National Bank of Her Mattress, thankyouverymuch.
Review Comments | 01.07.10
• Kumar Pleads Guilty in Galleon Case – Anil Kumar says he got $1.75 million for his inside dish from Raj. [WSJ]
• FASB Finalizes Changes on Consolidation, Equity – Subtopic 810-10 updates FAS 160, Noncontrolling Interests in…oh to hell with it. [Compliance Week]
• Cell Phones are Good for Your Brain – Gab away. [The Atlantic]