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January 27, 2023

Accounting News Roundup: Awful Clients and Lease Accounting Procrastination | 03.29.17

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Aren’t you glad there are so many insects for me to eat?

Awful clients

If you’re still cranking out 1040s, bless your heart. Clients that show up from now until mid-April, will more or less take this form:

There are the shoeboxers, who haul in shoeboxes or cartons brimming with every wayward item they received during the year, usually at the last minute. The people who bring the most stuff tend to provide the least necessary information. They’ll include receipts for buying their kid a Happy Meal at McDonald’s but forget the W-2 they received electronically. Shoeboxers can get stressed out and a little combative.

You just know that Happy Meal/W-2 story is true.

I think most accountants who still have clients that roll in with shoeboxes should either a) fire them or b) keep portable incinerators right by their desks as an implicit threat. I really don’t know how else these people will learn that the shoebox method is NOT okay.

The only other solution is for IBM to build a receptacle attachment for Watson that could eat the receipts and spit out a tax return. And now that I’ve written that, how is this not at the top of their priorities? Even the chintziest accountant would spring for the IBM Watson Receipt Eater 2000 if it guaranteed to make their life easier 2-4 weeks a year.

Lease accounting procrastination

The new lease accounting standard goes into effect for public companies in 2019 and in 2020 for private ones, but most of them seem pretty chill about preparing for it.

Twenty-two percent of the biggest businesses have started the transition, compared to 17 percent of the smallest. A bigger percentage of the largest companies have at least started writing new accounting procedures and policies and developed a project plan to deal with gaps found in their diagnostic work.

I think we can all agree that, with basically 2 years to go, the 22% of “the biggest businesses” and 17% “of the smallest” are the overachievers in the group. I wouldn’t be surprised if December 2018 gets here and 25-40% of all companies still hadn’t looked at the text of the new standard.

Bad busy seasons

Perhaps I’ve mentioned this before, but I think you can apply the Anna Karenia principle to busy seasons. That is, all good busy seasons are alike, while all bad busy seasons are bad in their own way. I don’t know how the busy season for the Grant Thornton team on U.S. Concrete went, but this Wall Street Journal article has some clues:

[CFO] Joseph Tusa, Jr. resigned Friday, according to a company filing. U.S. Concrete also said it dismissed its auditor, Grant Thornton LLP, replacing it with Ernst & Young LLP.

The move comes nearly comes three weeks after the Texas company said there was a lapse regarding “the completeness and accuracy of computations relating to income tax accounts and disclosures.”

U.S. Concrete had the same problem last year and amended its 2015 annual report. Grant Thornton also issued an “adverse opinion” regarding the company’s internal controls over financial reporting for both 2016 and 2015.

Or maybe everything has been fine this whole time and this resignation and firing all came as a huge surprise.

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Previously, on Going Concern…

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