Accounting News Roundup: Morgan Stanley’s CFO Has Some War Stories; Lamar Odom Sues IRS; More on Too Few to Fail | 11.10.10

A Female Wall St. Financial Chief Avoids Pitfalls That Stymied Others [NYT]
Ruth Porat, the CFO at Morgan Stanley, gets a write-up in the Times which doesn’t hesitate to point out all the women CFOs that have failed before her, “In Ms. Porat’s case, she is often reminded about recent Wall Street history. ‘Be careful in everything you do, because we all know how this ended before,’ another stock analyst told her at a cocktail party earlier this year on the 41st floor of Morgan’s Stanley’s headquarters in Midtown Manhattan, according to attendees.

The comment was a not so subtle reference to the last two female chief financial officers on Wall Streehman Brothers and Sallie L. Krawcheck at Citigroup. Ms. Callan resigned from Lehman just months before it filed for bankruptcy and is now under investigation by regulators. Ms. Krawcheck struggled as chief financial officer at Citigroup and was publicly demoted in early 2007.”

But the boys’ club might be able to relax on this one, as Ruthie sounds committed, “In 1992, during the birth of her first son, she was on the phone in the delivery room making client calls.” Oh, and there was this time that she threw her back out finished a presentation on the boardroom table. Legendary!

Ambac Has Stipulation With IRS Over Tax Dispute [Bloomberg]
Ambac Financial Group Inc., the bankrupt holding company for a failed bond insurer, has a stipulation with the Internal Revenue Service over a dispute about whether the agency can seize at least $700 million in tax refunds, an Ambac lawyer said in bankruptcy court today.

Under the stipulation, the IRS has agreed not to take enforcement action against Ambac or its subsidiaries without giving five days’ notice. The agreement will remain in place until Ambac holds a hearing to decide whether it can get a judgment to decide the issue.

Google to Give Staff 10% Raise [WSJ]
Chief Executive Eric Schmidt disclosed the raise in an email to employees, saying the company wants to lift morale. “We want to make sure that you feel rewarded for your hard work,” Mr. Schmidt wrote. “We want to continue to attract the best people to Google.”

The S.E.C., Whistle-Blowers and Sarbanes-Oxley [DealBook]
The S.E.C., led by Mary L. Schapiro, released its proposal last week. Unfortunately for businesses, the S.E.C. must comply with the Congressional directive that puts the interest of attracting tips about corporate wrongdoing ahead of the internal compliance programs that most corporations set up under the Sarbanes-Oxley Act, which passed eight years ago. For businesses, it looks like Congress may be willing to use the new whistle-blower programs to undermine Sarbanes-Oxley.

Lamar Odom Seeks Tax Deduction For NBA Fines and Fitness Fees [Forbes]
Odom is going pro se before a U.S. Tax Court to get back “$12,000 in sports fines and another $178,000 spent getting himself in shape.” His wife, no stranger to tax-related fiascos, must have told him that it was the smart move.

Does the GOP Really Want to Slash Spending in a Weak Economy? [TaxVox]
No doubt the GOP wants to shrink government. And there isn’t much doubt that some voters agree with them. But is this the time? Will voters be quite so enthusiastic once they realize spending cuts mean more than eliminating ever-popular waste, fraud, and abuse? Will they embrace actual reductions to those government services and benefits that they have grown to love? And, most important, will they accept these government spending cuts in the teeth of a still-sluggish economy?


The Big Four: Too Few to Fail [Accounting Onion]
We need at least a fifth firm, but preferably lots more, that are capable of taking on the largest corporations as clients. Surely, the public has learned more than they wanted to know about the concept of moral hazard from the too-big-to-fail banks. And just as surely, the Big Four are too few for financial regulators to let fail. This version of moral hazard is that each of the firms knows the position the financial regulators are in, and they take on more risk as a result.

IRS Announces 2011 VITA Grant Recipients [TaxProf Blog]
Glenn Beck can rest easy, ACORN isn’t on the list.

A Female Wall St. Financial Chief Avoids Pitfalls That Stymied Others [NYT]
Ruth Porat, the CFO at Morgan Stanley, gets a write-up in the Times which doesn’t hesitate to point out all the women CFOs that have failed before her, “In Ms. Porat’s case, she is often reminded about recent Wall Street history. ‘Be careful in everything you do, because we all know how this ended before,’ another stock analyst told her at a cocktail party earlier this year on the 41st floor of Morgan’s Stanley’s headquarters in Midtown Manhattan, according to attendees.

The comment was a not so subtle reference to the last two female chief financial officers on Wall Street: Erin Callan at Lehman Brothers and Sallie L. Krawcheck at Citigroup. Ms. Callan resigned from Lehman just months before it filed for bankruptcy and is now under investigation by regulators. Ms. Krawcheck struggled as chief financial officer at Citigroup and was publicly demoted in early 2007.”

But the boys’ club might be able to relax on this one, as Ruthie sounds committed, “In 1992, during the birth of her first son, she was on the phone in the delivery room making client calls.” Oh, and there was this time that she threw her back out finished a presentation on the boardroom table. Legendary!

Ambac Has Stipulation With IRS Over Tax Dispute [Bloomberg]
Ambac Financial Group Inc., the bankrupt holding company for a failed bond insurer, has a stipulation with the Internal Revenue Service over a dispute about whether the agency can seize at least $700 million in tax refunds, an Ambac lawyer said in bankruptcy court today.

Under the stipulation, the IRS has agreed not to take enforcement action against Ambac or its subsidiaries without giving five days’ notice. The agreement will remain in place until Ambac holds a hearing to decide whether it can get a judgment to decide the issue.

Google to Give Staff 10% Raise [WSJ]
Chief Executive Eric Schmidt disclosed the raise in an email to employees, saying the company wants to lift morale. “We want to make sure that you feel rewarded for your hard work,” Mr. Schmidt wrote. “We want to continue to attract the best people to Google.”

The S.E.C., Whistle-Blowers and Sarbanes-Oxley [DealBook]
The S.E.C., led by Mary L. Schapiro, released its proposal last week. Unfortunately for businesses, the S.E.C. must comply with the Congressional directive that puts the interest of attracting tips about corporate wrongdoing ahead of the internal compliance programs that most corporations set up under the Sarbanes-Oxley Act, which passed eight years ago. For businesses, it looks like Congress may be willing to use the new whistle-blower programs to undermine Sarbanes-Oxley.

Lamar Odom Seeks Tax Deduction For NBA Fines and Fitness Fees [Forbes]
Odom is going pro se before a U.S. Tax Court to get back “$12,000 in sports fines and another $178,000 spent getting himself in shape.” His wife, no stranger to tax-related fiascos, must have told him that it was the smart move.

Does the GOP Really Want to Slash Spending in a Weak Economy? [TaxVox]
No doubt the GOP wants to shrink government. And there isn’t much doubt that some voters agree with them. But is this the time? Will voters be quite so enthusiastic once they realize spending cuts mean more than eliminating ever-popular waste, fraud, and abuse? Will they embrace actual reductions to those government services and benefits that they have grown to love? And, most important, will they accept these government spending cuts in the teeth of a still-sluggish economy?


The Big Four: Too Few to Fail [Accounting Onion]
We need at least a fifth firm, but preferably lots more, that are capable of taking on the largest corporations as clients. Surely, the public has learned more than they wanted to know about the concept of moral hazard from the too-big-to-fail banks. And just as surely, the Big Four are too few for financial regulators to let fail. This version of moral hazard is that each of the firms knows the position the financial regulators are in, and they take on more risk as a result.

IRS Announces 2011 VITA Grant Recipients [TaxProf Blog]
Glenn Beck can rest easy, ACORN isn’t on the list.

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