Author: Caleb Newquist

Founding editor, Going Concern.

Life after Public Accounting: Is the Grass (aka Money) Really Greener?

As summer winds down, those of you that are still living the Big 4, et al. life may be wondering if you’ve squandered the last couple of months getting overserved on patios and roofdecks, spending hours by the pool and vacationing to exotic locales. You might say, “All this time I was having FUN, I could have been looking for my dream job. What was I thinking?”

For those capital market servants whose past season was simply too much to bear, you probably aren’t saying these words and have, at some point, spend a few weeks (or several) trying to find that perfect new job. For those who did finally pull the trigger on their public accounting career, a plea from a reader:

Can you guys do an article on the types of jobs (read: salary increases) former Big 4/public accountants have taken in industry (or somewhere else) after leaving this past busy season? I need a reminder of why I still work in audit.

Typically, auditors are in constant “remind me why I do this” mode but for the purposes of this post, we ask that tax and advisory professionals give the lowdown on their new gigs as well. Possible topics of interest to keep in mind when commenting:

• Did you simply leave for a bigger salary or bonus or were there work-life issues? If so, were your expectations in the marketplace met?

• Did you leave for a private company, nonprofit/government or – GASP – another public accounting firm?

• Is anyone going back to school?

• Anyone just saying fuck it and getting out of the numbers game altogether because they realized that money isn’t all it’s cracked up to be?

• Grabbag.

Accounting News Roundup: Coddled Billionaires; An Admission from PwC; What Do Young CPAs Want? | 08.15.11

Stop Coddling the Super-Rich [NYT]
While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks. Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15 percent tax rate. Others own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors. These and other blessings are showered upon us by legislators in Washington who feel compelled to protect us spotted owls or some other endangered species. It’s nice to have friends in high places.

PwC admits JP Morgan audit failings [Accountancy Age]
PwC has admitted a formal complaint over its audit of JP Morgan Securities (JPMSL) for the seven years to 31 December 2008. Accountancy and Actuarial Disciplinary Board chief Cameron Scott welcomed the firm’s “responsible” position, saying: “Those that accept mistakes can learn lessons from them.” PwC failed to report that JPMSL’s Futures and Options business did not segregate client money, in contravention of rules set out by the Financial Services Authority.

Google to Acquire Motorola Mobility for $12.5 Billion [Bloomberg]
Motorola shareholders will get $40 a share in cash, the companies said in a statement today. That’s 63 percent more than Motorola Mobility’s closing price on the New York Stock Exchange on Aug. 12. Both boards have approved the deal. Google, whose Android software runs mobile phones made by Motorola Mobility and companies such as Samsung Electronics Co., gains patents it needs to compete against Apple Inc.’s iPhone.

SEC Reviews S&P Math, Possible Leak of Rating [Bloomberg]
The Securities and Exchange Commission is scrutinizing the method Standard & Poor’s used to cut the U.S.’s credit rating and whether the firm properly protected the confidential decision, according to a person with direct knowledge of the matter. SEC inspectors are examining S&P’s policies for conducting such analyses and whether those procedures were followed when the New York-based firm downgraded the U.S.’s credit rating Aug. 5, said the person, who declined to be identified because the inquiry isn’t public.

What do young professionals want? [CPA Success]
Other than money, of course.

Accountant allegedly stole $241K from law firm[NF]
For two-and-a-half years, an accountant was allegedly using a prominent law firm’s bank account she controlled to allegedly pay her personal bills and even write herself double paychecks. Sharon Lynne Samples, 48, was booked July 31 and charged with taking $241,722 from the law offices of Lipscomb, Johnson, Sleister, Dailey and Smith, LLP, according to a Cumming Police incident report.

Bernie Madoff ditched by his wife of 52 years as she seeks reconciliation with son [Daily Mail]
The wife of Bernard Madoff has severed ties with the disgraced Wall Street financier and not seen him for more than six months, it has been revealed. Ruth Madoff, who has been married to the convicted fraudster for 52 years, has shunned her high school sweetheart as she allegedly seeks reconciliation with her son.

Deloitte Appoints Eric Openshaw to Lead U.S. Technology, Media and Telecommunications Practice [Deloitte]
In his new role, Openshaw will drive industry strategy, research, service development and delivery to the organization’s core [Technology, Media and Telecommunications] clients. Openshaw succeeds Phil Asmundson, who continues to lead Deloitte’s U.S. Media & Entertainment and Telecommunications as well as the Global Telecommunications sectors.

Former IRS Investigator-cum-Accounting Professor Claims He Took Money from 18 Year-old Prostitute ‘To Protect Her,’ Denies Pimp Status

Accounting professors can be a strange lot. This is known. Whether they’re getting ejected from basketball games, taking off their shirts for money or taking their pants for free, there is no shortage of curious behavior.

Then there’s the story of Kemp Shiffer, who was a part-time professor at the University of Nevada-Reno and IRS investigator. Prof Shiffer was arrested on August 3rd when he collected $400 from a 18 year-old prostitute:

The woman told police that before she began prostituting for Kemp Shiffer, he made her “try out” for the job by performing multiple sex acts on him, according to a probable cause affidavit filed in Reno Justice Court to support his Aug. 3 arrest.

After Shiffer took the money from the 18-year-old Eureka, Calif., woman at the Peppermill Resort Casino Spa just before 10 p.m. Aug. 3, detectives of the regional Street Enforcement Team arrested him.

“He spontaneously stated ‘I am not a pimp. I didn’t collect her money as her pimp. I collected it to protect her,’” according to the affidavit filed last week against the 58-year-old.

Apparently this isn’t Shiffer’s first attempt at “protection” as the Reno Gazette-Journal also reports that he quit the IRS after an investigation into his attempt to use “his authority and his badge to secure women to work as prostitutes for him.”

The reader who pointed us to the story simply had this to say, “And he was my favorite accounting professor when I was in school… who knew?”

Hopefully none of your female classmates.

Records: Retired IRS investigator charged with pandering said ‘I am not a pimp’ [RGJ]

Accounting Student Attempts to Explain How He Wound Up in a Looted Computer Store

Saffron Armstrong tried to explain that he had gone into a looted computer store because he was inquisitive – and a freelance journalist.

This drew sniggers from the press bench, but not from district judge Elizabeth Roscoe, who told him he faced a prison sentence. The 22-year-old pleaded guilty to burglary after being arrested in a PC World store in Colliers Wood, south London, the day after it was hit by looters. The accounting student from Mitcham, who also worked for Marks and Spencer, was remorseful and admitted his intentions had “not been for the best”. [BBC via AWEBUK]

Accounting News Roundup: Short Selling Bans in Europe; Zynga’s Material Weakness; Redefining ‘Tax Reform’ | 08.12.11

Short Selling of Stocks Banned in France, Spain [Bloomberg]
France, Spain, Italy and Belgium imposed bans on short-selling to stabilize markets after European banks including Societe Generale (GLE) SA hit their lowest level since the credit crisis. “While short-selling can be a valid trading strategy, when used in combination with spreading false market rumors this is clearly abusive,” the European Securities and Markets Authority, which coordinates the work of national regulators in the 27-nation European Union, said in a statement after talks ended late yesterday. National regulators will impose the bans

When Congressman Dave Camp Says He ‘Doesn’t Want to Rule Anything Out’ He Means Raising Taxes Is Ruled Out

You should know this.

“I don’t want to rule anything in or out,” Rep. Dave Camp (R-Mich.) said, according to Reuters. “I am willing to discuss all issues that might help us reduce our short and long-term debt and grow our economy.”

“Everything is on the table until we as a group rule it out,” added Camp, who is chairman of the tax-writing Ways and Means Committee.

A spokesman for the Ways and Means Committee said Camp’s opposition to raising taxes remains firm.

“Despite a misleading and inaccurate headline that attempts to tell a story when there isn’t one to tell, Chairman Camp’s position on taxes has not changed,” the spokesman said. “When discussing the concept that all potential solutions ought to ‘be on the table’ or that he ‘won’t rule anything in our out,’ he has always emphasized that any potential solution must be looked at through the prism of jobs and whether those proposed solutions would strengthen the economy. Obviously, tax increases wouldn’t make that list.”

Harbin Electric’s Ability to Timely File Financial Statements with the SEC Falls on One Lonely CPA

Today in odd things found in SEC filings, we were pointed to this 10-Q from Harbin Electric, Inc., “a Nevada Corporation, incorporated on July 9, 2003.” However, this gives you a little better idea about what Harbin’s business is:

Through its subsidiaries, the Company designs, develops, engineers, manufactures, sells and services a wide array of electric motors including linear motors, specialty micro-motors, and industrial rotary motors, with focus on innovation, creativity, and value-added products. Products are sold in China and to certain international markets.

There it is! Another reverse merger company operation. Of course, this could be a completely legitimate business that is making money hand over fist but if Roddy Boyd is writing about you, that could be a bad sign. But that’s neither here nor there. One interesting thing we found in the company’s Q is just how much the company depends on their SEC Reporting Manager (I’ve added some italics for emphasis):

We rely on the services of our SEC reporting manager to assist us in researching and resolving certain US GAAP accounting issues and preparing our consolidated financial statements.

We employ an SEC Reporting Manager who is a Certified Public Accountant in the United States to assist our internal accounting and finance personnel in resolving complex US GAAP accounting issues. From time to time we rely on her to conduct research on complex accounting issues relating to US GAAP and to provide advice to the Company as to how to comply with US GAAP. Although our SEC Reporting Manager is not involved in our day to day operations or the management of our accounting functions, she also assists us in our consolidation process and in preparing our consolidated financial statements and footnotes. If we were to lose the services of our SEC Reporting Manager, we would attempt to hire another similarly qualified person to replace her. The loss of the services of our SEC Reporting Manager, in the absence of a qualified replacement, could adversely impact our ability to accurately prepare our consolidated financial statements on a timely basis.

There’s really no way to know who this poor, lonely SEC Reporting Manager is but based on the disclosure, it seems pretty clear that if she were to meet with an unfortunate accident, Harbin would be up shit creek without a paddle (and there’s probably a hole in the boat).

Why, exactly, isn’t there an intern, temp, custodian, someone, ANYONE that serves as the backup QB? This is not immediately known. Perhaps the company broke the piggy bank paying for the reverse merger but it seems prudent that they at least throw in Ms. SEC Reporting Manager’s best girlfriend from high school or something.

Of course if you’re job hunting and have a decent résumé, you could always ring them up.

Going Concern Is Throwing a Party for Beta Alpha Psi Annual Meeting Attendees

Good morning, capital markets servants. Aren’t you glad there are still capital markets to serve? For now, anyway. Despite the doubts around our economy, we have a nice little offer for the future capital market servants who are attending this year’s Beta Alpha Psi Annual Meeting here in Denver. There are details after the jump but basically all you need to know is that it is tonight, attendees will be on a rooftop, there will be free refreshments, and attractive bar and wait staff will be catering to your requests.

So if you’re at this year’s meeting, join us at Spill located at 1410 Market St. in Denver, starting at 6:30 with open bar (beer, wine and well liquor) and appetizers until 8:30. I’ll be around chatting with various people so feel free to awkwardly interrupt to say hello; you never know, you might be getting me out of a bad conversation. Show up to eat, drink and mingle with your fellow attendees.

Fair warning, however, some of our sales people will be milling about chatting up exhibitors and apparently they have a reputation for being “loud” and “unprofessional” but you should know that only means they are FUN. So, unless you have a problem with that it’d be wise for you to show up. Hope to see you there.

ANR: Goodwill Impairment Test Gets Makeover; Social Media Is a Big Pee Party; Ex-Marvell Accountant Charged with Insider Trading | 08.11.11

FASB Simplifies Goodwill Impairment Test [CFOJ]
Bowing to complaints from private companies, the Financial Accounting Standards Board is changing how companies perform their goodwill impairment tests. The changes to the standard, approved Wednesday, will allow companies to do a preliminary assessment based on qualitative factors to determine whether they even need to perform a goodwill impairment test.

Auditor to IRS: Speed it up [The Hill]
Because people are starting to notice this bureaucracy thing.

Tech Blogger Won’t Be Charged in Apple iPhone Case [WSJ]
San Mateo County Assistant District Attorney Morley Pitt said charges were not filed against Gizmodo.com’s Jason Chen or other employees, citing California’s shield law that protects the confidentiality of journalists’ sources. “The difficulty we faced is that Mr. Chen and Gizmodo were primarily, in their view, engaged in a journalistic endeavor to conduct an investigation into the phone and type of phone it was and they were protected by the shield law,” said Mr. Pitt. “We concluded it is a very gray area, they do have a potential claim and this was not the case with which we were going to push the envelope.”

I need to pee [AccMan]
Now I’m just peed I didn’t think of it first.

Behind the Numbers: Critical Financial Analysis in Litigation [Fraud Files Blog]
Tracy Coenen tells you how.

Why did Green Mountain Coffee Roasters miss red flags? [WCF]
Probably because they don’t read Sam Antar’s blog.

Ex-Marvell accountant arrested for insider trading [Reuters]
Former Marvell Technology Group Ltd […] accountant Stanley Ng was arrested on Wednesday as part of the government’s probe into insider trading, an FBI spokesman said. Ng, 42, was charged with conspiracy to commit securities fraud by federal prosecutors in Manhattan, according to a complaint unsealed on Wednesday.

Poll: Americans skeptical Washington can fix economy [The Hill]
Meanwhile, just 1 in 5 thinks Washington is “focused on the right things,” half as many as backed that statement in October 2010.

Bonus Watch ’11: Deloitte Gives Up PowerPoint Presentations After Stellar Going Concern Reporting UPDATE: Audit Practice Didn’t Get the Memo

This just in from the Deloitte FAS comp call that is apparently going down circa now:

7% AIP pool. No slides with details b/c it ends up on GC. Talking about PwC right now.


What, exactly, is being said about P. Dubs is not immediately known but I’m guessing it has something to do with the fact that they’re obviously vulnerable in the Tampa market but actually it’s more like simple trash talk, according to our source:

[PwC] made draconian cuts during the recession. They are making up for it now. They suck, D&T rules. [FAS CEO] David Williams is stressing total comp., not just base salary throughout the call. Base comp is targeted at 50% of the comp survey range.

[PS -] He loves to use the word “granular” as much as possible.

Unrelated sidenote: David Williams’ favorite hobby, according to his firm profile, is yoga.

Of course you’re on the call and have other details you wish to share, you can elaborate below.

Earlier:
Comp Watch ‘11: Deloitte’s New Structure Is Taking Shape

UPDATE:
A little comparison for AIP and merit increases for the opiners appears on the following pages.