Author: Adrienne Gonzalez

Adrienne is a 15-year veteran of the accounting industry, if by "veteran" you mean "vulture prowling the periphery of the profession waiting for something exciting to happen." She has been spewing vitriol on Going Concern since the site was founded in 2009. A former CPA review employee, she has sat through more FAR classes than any CPA exam candidate ever could -- even one who has failed FAR seven times -- and can still recall most of the mnemonics all these years later.

Credentials for Accountants: Chartered Financial Analyst

Need help deciding what you want to be when you grow up? Check out the rest of our posts on credentials for accountants.

Into investments and looking to secure a credential that is recognized the world over as a standard of professional excellence? Getting the Chartered Financial Analyst (“CFA”) credential might be for you. You won’t be alone as 139,900 candidates in 160 countries have enrolled for June CFA exams this year.

Here’s the rest of the skinny on the CFA:

Education Requirement
To obtain a CFA, all you need is a bachelor’s and four years of relevant work experience, or a combination of education and experience that totals at least four years.

Professional Requirements
CFAs must have 48 months of qualified work experience to qualify to take the exams.


CFA Exam
The exam is administered only in English by the CFA Institute in June and December. The Candidate Body of Knowledge is the playbook from which all CFAs derive their moves; those who have recently passed the CPA exam can think of it as the opposite of the CPA exams, whereupon BEC is the largest section. Topics include the time value of money, corporate governance, equity investments and portfolio management.

The exam consists of three levels and Each has its own emphasis, with all of them weighing ethics heavily.

Level I emphasizes tools and inputs, and includes an introduction to asset valuation, financial reporting and analysis, and portfolio management techniques.

Level II emphasizes asset valuation, and includes applications of the tools and inputs (including economics, financial reporting and analysis, and quantitative methods) in asset valuation.

Level III study program emphasizes portfolio management, and includes strategies for applying the tools, inputs, and asset valuation models in managing equity, fixed income, and derivative investments for individuals and institutions.

All levels must be passed in order to secure the CFA designation. Each exam is 6 hours. There is no passing score, only pass/fail and candidates are given score reports that explain their performance according to other candidates. The exam uses a psychometric grading system similar to the CPA exam.

Studying takes about 10 – 15 hours per week for 18 weeks. Unlike the CPA, CFA candidates can take the exams as many times as they need to pass and there is no time limit to do so.

Career Options
A large number of CFAs end up as portfolio managers however other career options include research analyst, consultant, financial advisor or investment banking analyst. 7% of CFAs are actually chief executives.

Compensation and Other Benefits
Portfolio managers can make $77,443 – $144,360 (national average) so the obvious incentive to obtaining a CFA is the money. CFAs are overwhelmingly male, about 82% according to PayScale. For CPAs, the CFA designation offers quite a bit of flexibility in one’s career to work outside of accounting with a focus on financial products and investments.

Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor . You can see more of her posts for GC here.

Will a CMA or CFM Get You Some Kind of CPA Exam “Credit”?

The short answer is no. The medium answer is hell no and the long answer is the rest of this post but first, let’s address the reader question, shall we?

Will any of the sections passed for the CMA and/or CFM count against the requirements for the CPA examination? In other words, can I avoid taking certain sections of the CPA examination because I have passed the CMA and CFM?


ALL candidates have to pass all four parts of the exam and for the lucky ones, there’s even a fifth part to worry about called ethics but that’s not all of you so we won’t get into that. There is no credit given for life experience, other letters after your name, certifications, and/or letters from your Mom attesting to your good moral character. You don’t get extra credit for making your written communications 15 paragraphs long, nor do you get a bonus for having the prettiest scribbles on your scratch paper. Nothing. Sorry kid but them’s the breaks.

CMAs are not automatically eligible to sit for the CPA exam simply because they are CMAs however required coursework for both credentials are similar so if you are eligible to pursue one, you may be eligible to pursue the other without additional education. This career track is best accomplished by getting an MBA or Masters in accounting, not completing your Bachelor’s and simply picking up a few extra units to fulfill the CPA’s 150 hour requirement.

If you are into it, check out some recent IMA numbers on salary potential for CMAs and CPAs. So while you won’t be able to get out of any of the usual CPA exam gruntwork, it still might be worth it to pursue anyway. And bonus, you might just be able to count your CPE units twice for both designations.

Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor . You can see more of her posts here and all posts on the CPA Exam here.

PwC May Have Overlooked Billions in Illegal JP Morgan Transactions. Oopsie.

Now £15.7 billion may not seem like much to you if you are, say, Bill Gates or Ben Bernanke but for PwC UK, it may be the magic number that gets them into a whole steaming shitpile of trouble.

UK regulators allege that from 2002 – 2009, PwC client JP Morgan shuffled client money from its futures and options business into its own accounts, which is obviously illegal. Whether or not JP Morgan played with client money illegally is not the issue here, the issue is: will PwC be liable for signing off on JPM’s activities and failing to catch such significant shenanigans in a timely manner?


PwC did not simply audit the firm, they were hired to provide annual client reports that certified client money was safe in the event of a problem with the bank. Obviously that wasn’t the case.

The Financial Reporting Council and the Institute of Chartered Accountants of England are investigating the matter, and the Financial Services Authority has already fined P-dubs £33.3 million for co-mingling client money and bank money. That’s $48.8 million in Dirty Fed Notes if you are playing along at home.

Good luck with that, PwC. We genuinely mean that.

Inquiries mount after PwC ‘failed to notice’ mistakes [Times UK]

Does Anyone Have a Crayon for Mary Schapiro?

“The SEC’s efforts are, and will always be, a work in progress. We will continually refocus our energies as circumstances warrant, as new ideas are offered and considered, as we consider your opinions and suggestions. But the outlines are emerging, the colors are being filled in, and I am hopeful that a portrait of a financial marketplace more stable and efficient than the one we saw in 2008 is beginning to emerge.”

SEC Chair Mary Schapiro at CEO Quarterly Meeting of the Business Roundtable on the SEC’s ongoing efforts to color inside the lines. Apparently the Commission was free-handing all this time.

Convio Users Indicate That Things in the Nonprofit Sector Aren’t So Bad

Convio provides technology solutions to nonprofits and recently released a bit on its user base, showing pretty reassuring data that things are not that bad in the nonprofit sector.

When the Nonprofit Finance Fund released its 2010 outlook earlier this year, a nice calming Xanax was recommended before reading. So this is certainly a bit of good news for nonprofits, at least for the customer base from which the data was compiled.

Online giving grew 14 percent despite a difficult economy. Overall, 69 percent of organizations raised more in 2009 than 2008, while 31 percent saw declines in their online fundraising.

An increase in gifts drove fundraising gains. Of those that grew fundraising in 2009, 92 percent saw an increase in the number of gifts in 2009 compared with just 43 percent of organizations seeing an increase in their average gift amount.

Small organizations grew fastest. Organizations with fewer than 10,000 email addresses on file, many of which are participants in the Convio Go! program, grew online revenue by 26 percent, and gifts by 32 percent.

Web traffic growth continued for most, but at a slower rate. 60 percent of organizations grew their website traffic from 2008 to 2009. Web traffic growth in 2009 was in the single digits at 6 percent compared with double digit growth seen in previous years.

Web traffic was strongly correlated with email file growth. 38 percent of an organization’s success building large email files could be directly attributed to the amount of traffic to the organization’s website.

This year’s study analyzes data compiled from 499 nonprofit organizations that have at least 24 months of data to compare. The study aggregates results into benchmarks that nonprofit organizations can compare against their peer group and the industry as a whole. In addition the study provides separate benchmarks for 15 nonprofit industry sub-groups, or verticals across 19 key metrics. In total Convio’s clients raised more than $920 million online in 2009.

Convio Releases Annual Study of Nonprofit Sector’s Online Fundraising and Marketing Trends [BusinessWire]

Jury Awards $30 Million to Nonprofits That Alleged Fraud Against Wells Fargo

The Minneapolis Foundation, the Minnesota Medical Foundation, the Robins Kaplan Miller & Ciresi Foundation for Children and the Minnesota Workers’ Compensation Reinsurance Association have won $29.9 million from Wells Fargo in a Minnesota case that alleged investment fraud and breach of fiduciary duty based on investments the non-profits made that were deemed safe by Wells Fargo.


While similar cases against banks have mostly been settled out of court, this is the first time one such case has gone to trial.

Though the non-profits lost $14.1 million to these shoddy investments, Wells Fargo attorney Robert Weinstine blamed it on the financial crisis and insisted it was not Wells’ fault that funds were lost. The 10-member jury felt otherwise based on internal memos, e-mails and handwritten notes admitted as evidence in the trial.

The jury determined last Thursday that the bank would not be subject to additional payments for punitive damages. Attorney for the four non-profits Mike Ciresi had requested $100 million. Mathlete and Wells Fargo attorney Larry Hofmann told jurors that “zero is the correct number here” in terms of punies.

Four Time Management Tips for the CPA Exam

The subject of time management can be a sore one for CPA exam candidates, mostly the ones who have taken and failed at least one part knowing this was largely due to blowing too much time on a particular section or dedicating too much time to one component, like MCQ, and not nearly enough on simulations.

In order to combat this problem, it’s critical to set yourself a little countdown clock on your scratch paper as soon as you sit down at the computer to make sure you are leaving yourself plenty of time when you need it most.


Always allow 45 minutes for each simulation – Be sure to do each written communication first as only one is graded but you don’t know which and it’s an easy 10 points if you at least manage to scribble something down, even if you don’t have time to get through all the simulation tabs you can still pass if you have done the communications. It’s a crapshoot but stranger things have happened.

No more than a minute and a half on each multiple choice question – Add up the number of MCQ in a testlet and count up, writing the time you should be finished on your scratch paper. Let’s say you’re taking FAR and started at 10 am; you will need 45 minutes for each testlet if you are going to have 45 minutes left over for each simulation. So by 10:45, you should be on testlet 2, by 11:30, you’re on to testlet 3. That leaves you plenty of time for the sims. For REG, you’ve only got about 1.25 minutes per MCQ as you’ve got 3 hours total to get through the entire thing. If you’re doing well on time, go back and check the MCQ you marked for review (if any) otherwise trudge on to the next part and never take a break! You don’t have time!

And remember: never leave any questions blank! GUESS! – If you get it wrong, it’s wrong. If you get it right, you’re smarter and/or luckier than you thought and are that much closer to your CPA. The exam is a plus-point basis exam meaning you don’t lose points for wrong answers, you can only add points as you go.

If you’re short on time, forget the research – If you are running out of time on the simulations, try to complete as much as you can in each tab and blow off the research, as yet it isn’t worth much. This may change when CBT-e hits in 2011 but for now, it’s not worth it if you don’t have the time. You’d be better off reviewing your written communication if you only have two or three minutes to spare.

You learned all about time management when studying for the exam so take that knowledge into the testing center and knock ’em dead!

Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor . You can see more of her posts here and all posts on the CPA Exam here.

Legal Pot in California Won’t Change Much, Other Than the Taxes Of Course

Legalization of gay marriage didn’t go over very well in the Golden State but come November, my fellow Californians and I will be deciding whether or not we’re up for taxing the hell out of the chronic to save our state’s sad fiscal sitch with an estimated $1.4 billion in revenue a year by making marijuana possession legal. According to the bill, an ounce would bring in $50 in revenue .

Now, we’re not promoting huge grow rooms in grandma’s Pomona basement but the law would allow an ounce for personal use (some of you might question that amount as a tad large) and for anyone over the age of 21 to have 25 square feet of plants growing in their residence.


As is, California is pretty loose with the definition of “medical use” and if you’ve ever been to Venice Beach, you already know that pot has been a big business round these parts since Proposition 215 made medicinal use legal. Everyone from depressed shlubs to Mr Magoo-sighted grandmas can head to the cannabis club for their medicine and some smart cities like Oakland already tax these sales.

Some of you may not realize this but pot is essentially legal in San Francisco anyway. I’ve never heard of cops asking for a prescription if you get busted toking on a blunt in the FiDi (hey, work is stressful) and the rumor is that the SFPD has actually made it an unofficial policy not to hassle pot smokers as long as that’s all they’re doing.

So if you’re smoking a joint on the street, you’re fine. If you’re smoking a joint AND killing someone or smoking a joint AND not wearing pants, you might have some trouble but for the most part, you can trot around town puffing away without having to worry about getting hassled. Of course, driving under the influence is still illegal so I would not recommend puffing away from behind the wheel, no matter how lax the locals are towards the green stuff.

The state seems divided equally on the issue, with the LA Times reporting that a recent poll left the state split 49/41, with 49% in favor of the legislation. Listen, if it’s between legal weed and paying $989 to register my car, I’ll take the weed tyvm.

So? Smoke ‘em if you got ‘em and if you don’t got ‘em, feel free to tax ‘em. Get used to the sin taxes, it might be the only way to bring my fine state (and others in equally dismal fiscal situations) back from the brink of financial Armageddon. And if that doesn’t work, at least we’ll be too high to notice.

Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor . You can see more of her posts for GC here.

How to Avoid ID Problems at the CPA Exam

Although the instructions are pretty clear, this question comes up fairly often so let’s make sure everyone is on the same page when it comes to ID that works at Prometric when taking the CPA exam.

Prometric is very clear about what you should have before you get to the testing center (at least half an hour early, of course, and smokers should make that an hour so they can get in as many as they can before they start – you don’t want to waste those breaks).


First and foremost, check in with them 24 hours before your exam to confirm your appointment. The night before your exam date, set out your NTS and make sure you have two forms of exactly matching ID ready so you aren’t scrambling to find it in the morning.

At least one of your forms of ID must have a recent photograph and both must be valid (i.e. not expired) and signed. Try a credit card and a driver’s license, forget about a Social Security card or a student ID as Prometric will not accept these. A passport is OK but must be accompanied by a secondary ID (like a credit or debit card).

The name on your primary photo ID must match your Notice to Schedule exactly. If you show up and both names are different (foreign candidates who use both an English name and their native name sometimes run into this problem), Prometric will not allow you to test and you will forfeit exam fees. If there are any issues with your ID, contact them in advance to see if an exception can be made or make sure you will be okay come test day. Make sure to do this within your NTS timeframe and no less than 15 days before your exam date so you can at least reschedule without losing your exam fee if need be.

Got it?

Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor . You can see more of her posts here and all posts on the CPA Exam here.

Credentials for Accountants: Certified Valuation Analyst

Need help deciding what you want to be when you grow up? Check out the rest of our posts on credentials for accountants.

The CVA isn’t like other certifications in that if you’re going for one, you’re probably trying to add to your arsenal of professional credentials and have a few days to spare for the intensive training.

What’s it take?
This is directly from the National Association of Certified Valuation Analysts (NACVA):

The Business Valuation Certification and Training Center’s compact five-day intermediate level curriculum is comprehensive and substantive, providing value from beginning to end. A good understanding of accounting, taxes, economics, finance, and a basic understanding of business valuation fundamentals are prerequisites. The BVTC’s primary goal is to provide you with information that will serve as a solid foundation for your professional valuation endeavors, whether or not you plan to pursue a designation.

The five-hour CVA exam is administered in a rotating yearly schedule in 13 U.S. cities (twice yearly in Chicago) following the five-day training.

The NACVA is a NASBA-recognized CPE provider, meaning the training and certification can satisfy CPE requirements for CPAs. State boards have the final say on what counts for CPE purposes so check with yours if you are interested in completing this program to satisfy CPE requirements. The NACVA has trained 15,000 CVAs since its inception in 1990 and its members are subject to the same sort of ethical standards as CPAs.

The entire program – not counting the exams and any study materials – runs about $3,555 (by comparison, the CPA exam costs around $1000 – $1500 just to sit, excluding CPA review fees or retakes) and the exam itself is $595.

Who would want a CVA?
Tax professionals, for one, but also M&A consultants, investment professionals, financial analysts, financial officers and of course accountants interested in valuation and providing this service to their clients.

Why would you want a CVA?
Businesses need to be valued for all sorts of reasons. Mergers and acquisitions make up a large part of this but the CVA also comes in handy for estate taxes, employee stock ownership plans, divorce, and partner break-ups. This makes it an always-in-demand credential in a constantly-evolving marketplace.

Compensation
Salary is impacted according to one’s position or other credentials. For example, a CFO with a CVA can expect to make a median salary of $125,000 according to PayScale. On the other side of the spectrum, a senior tax accountant with a CVA weighs in at an average of $60,000. But we knew tax was a thankless gig to begin with, didn’t we?

Since CVAs can also unravel bankruptcies and liquidations, the career options may be just about endless moving forward. Better start saving your pennies for that 5-day excursion.

Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor . You can see more of her posts for GC here.

GAO Audit Uncovers Fraud at Head Start Programs

The Head Start Program, under the Department of Health and Human Services, provides child development services to mostly low-income families and their children. Up to 10% of Head Start-enrolled families can be over-income, with an income 130% above the poverty line.

Of course, things don’t always work out as they are supposed to and the GAO has discovered problems with about half of the centers it examined through the investigation, just a small sample of the 1,600 nonprofit centers running 3,000 Head Start programs.


From the GAO:

GAO received allegations of fraud and abuse involving two Head Start nonprofit grantees in the Midwest and Texas. Allegations include manipulating recorded income to make over-income applicants appear under-income, encouraging families to report that they were homeless when they were not, enrolling more than 10 percent of over-income children, and counting children as enrolled in more than one center at a time. GAO confirmed that one grantee operated several centers with more than 10 percent over-income students, and the other grantee manipulated enrollment data to over-report the number of children enrolled. GAO is still investigating the other allegations reported. Realizing that these fraud schemes could be perpetrated at other Head Start programs, GAO attempted to register fictitious children as part of 15 undercover test scenarios at centers in six states and the District of Columbia. In 8 instances staff at these centers fraudulently misrepresented information, including disregarding part of the families’ income to register over-income children into under-income slots. The undercover tests revealed that 7 Head Start employees lied about applicants’ employment status or misrepresented their earnings.

GAO managing director for special investigations Gregory Kutz told a House education committee last month that “the system is vulnerable to fraud.” No kidding.

While unable to determine the motivation of Head Start employees to commit fraud by adjusting income levels on applications, Kutz theorized that management of nonprofit agencies receiving Head Start funds pressured staff to fudge, fiddle with, or straight up fake figures on applications in order to keep federal funds coming in.

Head Start has served over 25 million children since 1965 and there are currently over 1 million children enrolled in Head Start programs.

Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor . You can see more of her posts here.

The CPA Exam Application Timeline

Since graduation season is once again upon us, we thought we’d revisit a time tested favorite question from CPA exam candidates: When should I apply for the CPA exam?

First, find out when your school posts degrees to transcripts and whether or not the state you are applying to requires a degree before you can apply. If you are unsure of your state’s requirements or which state you might qualify in, NASBA has a really handy search tool you can use ($10 for 24 hours of access). Or just check out the website to read up on your state’s requirements. If you need a degree before you can apply, you’re going to need to know how long you’ll be waiting for your school to post it. Don’t apply any earlier as your application will be rejected and you’re out the initial exam fee.


If you’re planning on jumping right in to studying, you can generally apply to sit for the exam right after your degree posts. Remember, at this point you want to have tied up all the loose ends in your life that will keep you from studying; crazy ex-girlfriend, slave-driving boss, roommate drama… you get it. Sweep all that aside and submit your application (and fees!) as soon as you can. Don’t forget, just because they cashed your check does not mean you have been approved to sit so don’t get excited if you see it clear a week after you sent it in. That’s usually the first thing they do since you’re out the fee whether or not you qualify and hey, who doesn’t want money?

Now, should you start studying right away? It depends on how long your state takes to process applications. If you are looking at a 6 – 8 week wait, you may want to hold off on cracking the books, especially if you plan to start with something small like BEC. If you start studying too soon, you run the risk of being denied to sit for the exam and losing precious CPA review time (many programs have expiration dates – always ask!) catching up on units you need to qualify. Don’t invest in a review course until you’re absolutely sure you will be able to start sitting for exams right away. If you come from a quick processing state (usually a search through the CPAnet forums can reveal more detailed information from other candidates in your shoes) and are absolutely certain you meet your state’s requirements, you can start studying as soon as you send in the application.

Congrats to the spring grads and feel free to get in touch if you’ve got any questions about the CPA exam!

Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor . You can see more of her posts here and all posts on the CPA Exam here.