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December 1, 2022

Accounting News Roundup: Deloitte’s Global Revenues; Accountants Trying to Be Bankers; Tax Reform’s Effect on Housing Prices | 09.16.13

Deloitte grows for fourth consecutive year, reporting US $32.4 billion in revenue [Deloitte]
The firm also reports "its total workforce now exceeds 200,000 professionals."

When Accountants Act as Bankers [NYT]
Accountants in many countries have suffered from what might be called “banker envy,” in which they contrast their remuneration with that of bankers also involved in putting together deals. In Britain, they have won the right to do transaction advice and to be compensated based on the size of the deal, as bankers are. That is not allowed in the United States. The Financial Reporting Council says Deloitte received £1.9 million for audits and £1.8 million for tax work from MG Rover from 2000 to 2005. It collected £26.7 million in corporate finance advisory fees from the Phoenix entities that controlled MG Rover. In helping the Phoenix Four, Deloitte may have jeopardized that source of profits, not only for itself but for other large accounting firms.

UK watchdog probing PwC audit of Berkeley [Reuters]

Britain's accounting watchdog said it has opened an investigation into whether PricewaterhouseCoopers was acting independently when it checked the books of UK house builder Berkeley Group Holdings. The Financial Reporting Council said on Monday the probe will look at PwC's audit of Berkeley's financial statements for the year that ended April 30, 2012, as a result of a former PwC partner joining Berkeley's board.

Big changes in store for FASB, Golden says [JofA]
“We should listen to our stakeholders across the country who have delivered mixed reviews regarding the codification,” [FASB Chairman Russell] Golden said. “Most agree and applaud the concept of the value of the codification, but they also observe that, as presently constituted, it is very cumbersome and not user-friendly.”

Miami hospital operator settles with SEC over accounting [Reuters]
The U.S. Securities and Exchange Commission alleged that the Public Health Trust misstated current and future revenue due to problems with a new billing system that inaccurately recorded revenue and patient accounts receivable. The trust had projected a non-operating loss of $56 million in a document with its August 2009 bond offering. But later, after the bonds were sold, external auditors discovered problems with the billing system. The Public Health Trust ultimately reported a non-operating loss figure that was more than four times higher, at $244 million, the SEC said. The SEC also alleges the trust did not account properly for an adverse December 2008 arbitration award and misrepresented that its financial statements were prepared according to U.S. Generally Accepted Accounting Principles, or GAAP.

Apparently there's a West Hartford, CT band called the Accounting Crows and they've been together 16 years [WHP]

Startup CEO to Customer: "Fuck off" [ValleyWag]
Seattle resident Erin Boudreau was unhappy with her Postmates delivery experience, so she emailed customer support. At some point along the way, CEO Bastian Lehmann wrote the above message, which was then included in the thread to Erin. Whoops! Corporate transparency is good, and it's always a nice surprise to have the head of the company get his hands dirty in customer support, but not like this. In a pseudo-contrite blog post, Lehmann claimed the email was "a bad joke which was very poor in taste," which is exactly what you would say if you told someone to "fuck off" and it got back to them by accident.

New Estimates of Tax Reform's Effect on Housing Prices [Tax Policy Center]
The impact of tax reform on housing prices has traditionally been studied by examining the user cost of capital— the after-tax cost to the homeowner per unit of housing. This brief summarizes findings from a new “discrete period” approach which considers the time element of housing investment and accounts for one-time transaction costs, such as transfer taxes, settlement fees, and realtor commissions. Under this framework, tax reform yields much smaller estimated house price declines and some reforms are estimated to actually boost housing prices.

Holy Water May be Harmful to Your Health, Study Finds [ABC]
Researchers at the Institute of Hygiene and Applied Immunology at the Medical University of Vienna tested water from 21 springs in Austria and 18 fonts in Vienna and found samples contained up to 62 million bacteria per milliliter of water, none of it safe to drink. Tests indicated 86 percent of the holy water, commonly used in baptism ceremonies and to wet congregants' lips, was infected with common bacteria found in fecal matter such as E. coli, enterococci and Campylobacter, which can lead to diarrhea, cramping, abdominal pain, and fever. Nitrates, commonly found in fertilizer from farms, were also identified in the water. If ingested, water containing nitrates over the maximum contaminant level could cause serious illness, especially in infants younger than 6 months, which could lead to death if untreated, according to the U.S. Environmental Protection Agency.

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