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January 28, 2023

Accounting News Roundup: Monsanto’s Rebates; Deloitte Exec Capable of Decent Interview; Voluntary Job-Quitting | 02.10.16

Monsanto to Pay $80 Million to Settle Charge of Improper Accounting [NYT]
Do you remember the matching principle? You know, one of the most basic guidelines in accounting that says that expenses should be recognized in the same period as revenues? It rings a bell, I'm sure. Monsanto seems to have had some trouble remembering it, though:

Monsanto will pay $80 million in penalties to the Securities and Exchange Commission to settle claims that it misstated earnings after failing to properly account for the costs of a sales rebate program for its flagship herbicide product, Roundup.

The S.E.C. said Monsanto, an agribusiness giant based in St. Louis, had insufficient internal controls to properly track millions of dollars in rebates it offered to Roundup retailers and distributors. The rebates were part of a promotion that Monsanto ran after sales of a generic version of the product undercut its business in 2009.

Monsanto booked substantial revenue as a result of the sales promotion from 2009 through 2011, but it did not recognize related costs, which led it to misstate corporate profits over a three-year period. 

"Monsanto devised rebate programs that elevated form over substance, which led to the booking of substantial amounts of revenue without the recognition of associated costs," said Scott Friestad, an Associate Director from the Division of Enforcement   Two accountants, both CPAs, and a sales executive were at the heart of this thing, which you can read about in excruciating detail in the SEC order. Also, Monsanto's CEO and CFO reimbursed the company nearly $3.9 million in cash and stock bonuses they received during the period in question, so SEC didn't have to "pursue a clawback action under Section 304 of the Sarbanes-Oxley Act." 

How following 'plan C' put Janet Foutty on track to become Deloitte Consulting’s first female CEO [Bizwomen]
I like to kid that one of the services we provide around here is reading bad interviews with accounting firm executives. I kid, but I kid seriously because most of the interviews are not worth reading and are filled with empty cliches and corporate speak that you get enough of in your day-to-day work lives. But I have to say, this one with Janet Foutty isn't that bad. The bar is low, I realize, but I guess I appreciate honesty like:

My mom made it very clear that summers were not for being idle. I think that’s mostly because I was driving her crazy with my energy level.


My husband, we’ve been married almost 25 years, and he still says it’s his greatest disappointment because the idea of going out for coffee and enjoying coffee with me is something that he still to this day, 25 years later, has not convinced me [to do].

And when she got the Deloitte Consulting CEO job, her son responded to her text with: "So mom may be a CEO, but I vacuumed my room last night. Who should we be more proud of?" The kid has a point! 

London accountant describes ‘hell on earth’ of 14 months without charge in notorious Burmese jail [Telegraph]
It's worth mentioning that if you're traveling abroad, don't get caught up in any funny business like this poor guy:

Niranjan Rasalingam, 29, an accountant from Croydon, was arrested in Rangoon in Dec 2014 as a suspected member of a ring of foreign nationals that allegedly stole nearly £14,000 using cloned bank ATM cards.

Mr Rasalingam denies the allegations and has languished without charge in the city’s infamous Insein prison where thousands of political prisoners were jailed and tortured under the old military regime.

Previously, on Going Concern…
I explained how to use hashtags. (If your Mom's an accountant, forward it to her.)

In other news:

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