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Accounting News Roundup: Mickelson Didn’t Trade Clorox Shares; PCAOB Rebukes EY, Again; When Success Feels Empty | 06.12.14

Mickelson Role Said to Be Overstated in Insider Inquiry [DealBook]
Phil didn't even trade in Clorox, apparently. However, the Feds are still looking into his trades in Dean Foods: "Recent reports in The New York Times and other news organizations said that Clorox was among the stocks that federal authorities were examining as part of a two-year investigation into well-timed trades made by Mr. Mickelson and the sports gambler William T. Walters. Initially, authorities pursued a theory that Mr. Icahn shared private details of his Clorox bid with Mr. Walters, who then traded on the information and passed on the tip to Mr. Mickelson. Although Mr. Icahn and Mr. Walters remain under investigation over Clorox, the F.B.I. and the Securities and Exchange Commission have found no evidence that Mr. Mickelson traded Clorox shares."

Audit Regulator Rebukes Ernst & Young [WSJ]
EY's second. Their first came in May 2013. "The PCAOB unsealed parts of an inspection report on Ernst & Young it had issued in November 2011, saying the firm had problems in its internal 'engagement quality review' process that provides a second set of eyes on each of the firm's audits. The firm wasn't performing those reviews 'at a sufficient level of rigor and detail,' the PCAOB said. In addition, the board said, Ernst & Young auditors sometimes relied heavily on evidence that supported a company's own position on its accounting and didn't sufficiently take new or contrary evidence into account."

Watchdog drops probe into PwC’s Berkeley audit [FT]
Nothing to see here: "
When the investigation was started, the FT reported that the case related to Glyn Barker, a PwC partner who became a non-executive director on Berkeley’s board during the year in question. The FRC was investigating whether Mr Barker was in a “chain of command” role at PwC when the firm was auditing Berkeley’s accounts, in the run-up to him joining Berkeley’s board in January 2012. Berkeley subsequently dropped PwC as auditor, ending a relationship stretching back almost three decades, and hired KPMG. Commenting on the Berkeley case on Thursday, PwC said: 'We co-operated fully with the FRC in its investigation and are pleased that, having investigated the matter, the FRC has closed it without any action.' "

The failure of HKICPA regulation [China Accounting Blog]
Paul Gillis offers an example of the accounting profession's poor self-regulation in Hong Kong: "I offer as evidence the case of former EY senior partner Anthony Wu. Wu was found to have violated auditor independence rules because he was a member of the client’s executive committee, authorized signer on 13 client bank accounts, had significant personal dealings with client subsidiaries, loaning the client money, and having EY collect a retainer for his services as a financial advisor.  The client, New China Hong Kong Group collapsed in 1999, spawning a series of claims. Eventually complaints were filed with the HKICPAs about Wu, another EY partner and EY itself. […] [T]he case was finally heard by a HKICPAs disciplinary committee in May 2013, making it the longest running case in HKICPA history by a huge margin."

Accounting Firms Kennedy and Coe to Merge with Matson and Isom [CPAPA]
Together, the two firms will have 375 professionals and nearly $60 million in revenue.

Some Financial Professionals More Pro than Others [NY1]
Avery Neumark is not shy about discussing his credentials: "I had to learn a lot to become a certified public accountant," the partner at Rosen Seymour Shapss Martin & Company LLP told NY1. "And just to let you know i also am a lawyer and I took the bar exam. The bar exam is two days. The CPA exam is three days."

What to Do When Success Feels Empty [HBR (Free registration)]
When that promotion doesnt't feel as good as it should.

Woman Who Shot Missile Into Car Has Most Florida Name EVER (EVER) [Jezebel]
Crystal Metheney.

Posted in ANR