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Accounting News Roundup: Reid Warns Baucus on Tax Reform; More Deloitte Humblebragging; PwC’s Newest ‘Strategic Alliance’ | 08.02.13

Posted on by Caleb Newquist

U.S. Added 162,000 Jobs in July; Jobless Rate Falls to 7.4% [NYT]
The job gains reported by the Labor Department on Friday, were concentrated in retail, food services, financial activities and wholesale trade. The manufacturing sector gained 6,000 jobs; government employment stayed basically flat. While July represented the 34th straight month of job creation, the relatively strong employment gains were still not on track to absorb the backlog of unemployed workers anytime soon. At the recent pace of job growth, it would take about seven years to close the so-called jobs gap left by the recession, according to the Hamilton Project at the Brookings Institution.

Reid Warns Fellow Democrat on Tax Talks [WSJ]
"I've explained this to Sen. Baucus," Mr. Reid said, taking the unusual step of speaking publicly about a colleague. "I don't want anyone going into these negotiations with the illusion that they can come back with a small [revenue increase] number, and we'll gobble it up under the guise of tax reform." Mr. Reid said that "it would be a waste of time" to enter into negotiations with Sen. Orrin Hatch (R., Utah), Mr. Baucus's GOP counterpart on the finance panel, and expect Senate Democrats to accept a bill without significant revenue growth. When asked about Mr. Reid's comments, an aide to Mr. Baucus said, "Sen. Baucus has been saying for more than a year now that he is working on a comprehensive tax-reform bill that will raise significant revenue. That has never changed, nor will it."

We're Bullish About July Jobs Report: Deloitte CFO [Bloomberg]
Frank Friedman gets his turn to humblebrag about Deloitte's hiring numbers. But be completely wrong about today's job numbers.

Ross McEwan, New RBS Boss, Failed Accounting Exams Twice [PA]
There's still hope for you!

Baby delivered at L’Enfant Plaza Metro station [WaPo]
Shavonnte Taylor, 23, of D.C., gave birth to her son, whom she named Amir Mason, at 10:30 a.m., according to a witness on the scene. In an interview at George Washington University Hospital on Thursday evening, Taylor said her fourth child was due on Aug. 17. She was actually heading from her home in Southeast to an obstetrician appointment near the Foggy Bottom Metro when she began to experience contractions. […] “It just popped out,” [Saa] Alpha, [a station manager] said. “It was just awesome.”

Deloitte should apologise for its role in Rover farce [FT]
Deloitte’s response to the ruling is “surprise and disappointment”. There’s no suggestion of contrition. Indeed, the firm maintains that it helped to generate value and keep the business alive for five years. This is a travesty. Rover was kept alive by the money paid in by BMW when it gave the company away, to cover generous redundancy payments, and by the time the business finally failed, there was nothing left. The workers were five years older, less able to find other employment, and without the financial cushion that BMW’s money would have provided. Rather than firing back, Deloitte would be better advised to apologise for a disgraceful episode that – entirely predictably – blighted the lives of 6,000 Rover workers.

Galvanize and PriceWaterhouse Coopers form alliance [DP]
PwC US and Galvanize, a Denver-based group that assists entrepreneurs, said Thursday that they have entered into a strategic alliance. Galvanize provides technology innovators and startups with working space, training and access to investors. PwC, also known as PricewaterhouseCoopers, will provide its consulting expertise for free to Galvanize members, who number more than 300.
 
Man Repays $500,000 in Insurance Money With 4 Tons of Quarters [Gawker]
When Roger Herrin learned that a court had ordered him to repay $500,000 he had received in insurance payments for the death of his son, he decided to protest the order in an unusual way: he paid approximately a third of the money back in quarters, which, altogether, weighed nearly four tons. […] The 7,500 pounds of quarters were packed in 50 pound, transparent bags, and transported from the Federal Reserve in St. Louis to the law offices of the attorneys representing the other families on a flatbed truck and in an armored truck. Naturally, the attorneys receiving the quarters weren't pleased.
Posted in ANR

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The Path to Global Standards? [CFO]
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Audit Credibility [The Summa]
From Professor Albrecht, ” ‘Do credible CPA audit firms add benefits to clients that exceed the audit costs?’ It’s an interesting question, I suppose, to narcissists (Big 4 auditors, government regulators and accounting professors) who believe that the world revolves around the audit function. It isn’t a question that floats my boat, for I’m concerned with a different question, ‘Credibility?’ Do credible CPA audit firms add net benefits to investors?”

Finance Chiefs Expand Roles [WSJ]
Long seen as the overseer of a company’s books, finance chiefs have been getting more deeply involved in business strategy, deciding where to invest capital and even looking at a company’s product mix. They’re also taking on new responsibilities: overseeing divisions like information technology, production, customer service and human resources. The change comes as companies put more emphasis on controlling costs, seeking input from finance chiefs as the companies try to manage revenue growth more closely during a tentative economic recovery.

In Financial Crisis Autopsy Auditors Nowhere To Be Found [Forbes]
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Harmonised accounting rules to hit US banks [FT]
US banks could see their balance sheets balloon under new proposals from the accountancy rulemakers that would dramatically reduce their ability to net their derivatives exposure. The Financial Accounting Standard Board and its international counterpart are planning to establish a common approach to the presentation of financial assets and liabilities on company balance sheets.

Big four auditors ’embedded in tax haven world’ [Daily Mail]
The Big Four accountancy firms have come under attack for maintaining on average more than 20 offices each in offshore tax havens despite countries working together to crack down on tax avoidance. The four firms – PricewaterhouseCoopers, KPMG, Deloitte and Ernst & Young – have 81 offices in offshore tax havens, according to new research by Financial Mail. MP Chuka Ummuna, who earlier this month confronted Barclays chief executive Bob Diamond over the banks’ 300 offshore subsidiaries, said: ‘There’s a whole industry out there dedicated to helping people avoid tax that will increasingly come under the microscope.

Accounting News Roundup: CEO Pay > Taxes Paid; Auditors Now Under Heat for Greek Debt; Ripping off the Old People | 08.31.11

Some companies pay their CEOs more than Uncle Sam, study says [WaPo]
It has become a bipartisan article of faith in some quarters that the income tax on U.S. corporations must be lowered. But for many large U.S. companies, the burden of U.S. taxation pales in comparison with what they pay their chief executives, according to a study released Wednesday by the Institute of Policy Studies, a liberal think tank. Of last year’s 100 highest-paid corporate executives in the United States, 25 earned more in pay than their company recorded as a tax expense in 2010.

[Bloomberg]
Memo to Grover Norquist.

GOP Tax Expert to Lead Deficit-Committee Staff [WSJ]
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SEC Lawyer Blew Whistle Before [WSJ]
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Auditors under fire over Greek debt [FT]
Auditors and regulators have come under fire for allowing European financial institutions to take wildly divergent approaches to Greek government bond writedowns. The criticism comes amid claims that some banks and insurers should have reported bigger Greek losses than they had acknowledged in recent first-half results announcements. “Auditors have not enforced a consistent approach among their clients,” said analysts at JPMorgan Cazenove in a report drawing attention to the way that some significant financial institutions had written down Greek sovereign debt holdings by half, while others had cut their value by only a fifth.

SEC recovers bonus from ex-Beazer CFO [Reuters]
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Ex-Rite Aid exec Franklin Brown freed after resentencing on accounting scandal charges [PN]
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