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February 3, 2023

Accounting News Roundup: Too Much Tax Cuts; ‘Baller’ Stock Offerings; Pot Banking | 02.06.18

accounting news carillion jobs act, ipos

Investors Fear the Tax Cuts Will Work Too Well [NYT]
Andrew Ross Sorkin writes that “Investors believe his policies to stoke growth are going to work so well that they will overheat the economy, and force the Federal Reserve to try to slow things down by raising interest rates faster than expected.”

IPO Shortcuts Put Burden on Investors to Identify Risk [WSJ]
The JOBS Act, passed in 2012, allowed “emerging” companies to file for IPOs confidentially and bypass a lot of Sarbanes-Oxley’s requirements. The majority of companies listed under the JOBS Act in 2017 are underperforming “trading an average 42% below their offer prices.” And then there are the loosened rules under Regulation D that “lifted a ban for general solicitations” which allow for the Scott Disicks of the world to hype companies on their Twitter accounts:

Mr. Disick tweeted to his 6.9 million followers Jan. 24 about the IPO, encouraging them to “live large & own the next MTV with me.” Also in the tweet: “NO RISK! NO REWARD!”

In describing its use of Regulation D for the maniaTV offering, CEO Drew Massey said he views the rules as a way to sidestep venture capitalists and bankers, while enriching individual investors.

“We almost called it a baller stock offering because Scott is a baller,” he said.

Carillion’s former finance boss denies ‘being asleep at the wheel’ [Reuters]
Zafar Khan believes he “did everything that I could have done essentially,” but MP Rachel Reeves wasn’t having it:

“Four months after you left, the company went into liquidation with just 29 million pounds left, leaving thousands of people potentially without jobs, and thousands of people saving for pensions without the pensions they’d expected, but you did everything right at the right time,” she said.

“Well done Mr Khan.”

Related: KPMG chief bans firm from ‘Carillion profiteering’ amid backlash

Fed Backs Marijuana-Focused Credit Union [WSJ]
Fourth Corner Credit Union in Colorado got the Fed’s blessing only after it “agreed to step back from its original plan to serve state-licensed dispensaries” and to focus on “individuals and companies that support legalized marijuana,” such as accountants, lawyers, and other vendors.

Previously, on Going Concern…

In Open Items, “I’m almost at the point where I’m about to give up on public accounting. What can I do differently? Should I try something else?”

From the archives: CPA’s Story of Quitting His Crappy Job Harkens to a Simpler Time When We Didn’t Have to Endure Verbose, Self-Absorbed Emails

In other news:

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