Category: ANR

Rick Perry, Texas, and Taxes [TaxVox]
Texas Governor Rick Perry, the latest entrant in the GOP presidential sweepstakes, swaggers into the race as the very personification of a low-tax, small-government, Lone Star politician. But his record on taxes over more than two decades as a legislator and governor turns out to be much more complicated (dare I say nuanced) than that.

Corporate Treasurers Take Turn in Spotlight [WSJ]
Anthony Scaglione was sitting at his desk at his Midtown Manhattan office on Aug. 5 when the news about the downgraded U.S. credit rating flashed on his Bloomberg terminal. “It was an “Oh s*** moment,’ ” says Mr. Scaglione, corporate treasurer for ABM Industries Inc., a janitorial and facility services provider with 100,000 employees. In the ensuing days, Mr. Scaglione would be called on to ensure the company’s liquidity as the lending environment grew murky and the stock market see-sawed. The pressure is on for corporate treasurers like Mr. Scaglione, who typically work behind the scenes under a company’s chief financial officer and are responsible for managing cash flows, acting as a point person with credit agencies and assessing the credit worthiness of banking partners. In recent weeks, they have found themselves working longer hours, frequently meeting with higher-ups, maintaining constant dialogue with their banks and revisiting strategic plans.

Warren Buffett’s Tax Dodge [WSJ]
Barney Kilgore, the man who made the Wall Street Journal into a national publication, was once asked why so many rich people favored higher taxes. That’s easy, he replied. They already have their money. That insight is worth recalling amid the latest political duet from President Obama and Warren Buffett demanding higher taxes on “millionaires and billionaires.” Mr. Buffett is repeating his now familiar argument this week, coinciding with Mr. Obama’s Midwestern road trip on the economy. Since the media are treating Mr. Buffett as a tax oracle, let’s take a closer look at some of the billionaire’s intellectual tax dodges.

Consumption Tax Would Ease U.S. Deficit [Bloomberg]
Make no mistake: The VAT would be a new tax. It would raise the total burden on U.S. taxpayers and, once it takes effect, would almost certainly take a bite out of consumer spending. But done in concert with broader tax reform, it would go a long way toward solving the country’s fiscal crisis.

Kashoo Announces Availability of Accounting App for iPad [Kashoo]
Kashoo’s iPad accounting app gives small businesses and entrepreneurs the flexibility to manage all aspects of their finances on the go, including monitoring key business metrics, creating and delivering invoices, recording expenses, tracking payments, and generating financial reports.

“Big four” safari: Shoot to kill [The Hill]
[G]lobal corporations don’t need global accounting firms, i.e. the big four, anymore. Regional headquarters of Fortune companies have no problem choosing their accounting firm on a regional level. Due to standardized accounting methods and technical capabilities, nowadays a consolidation of regional auditing results at the headquarter level is no problem. The response to the EU’s green paper was huge. 700 companies, associations and auditors participated in the consultation, sending in 10,000 pages of paper — an all-time record, but understandable. Because Barnier’s final goal is not about just breaking the audit oligopoly. It is about the separation of audit and non-audit services eventually.

The dual-taxation meme [Felix Salmon/Reuters]
There appears to be a trend to criticism of O^3.

Company report pace frustrates accounting experts [Reuters]
Author and lawyer Michael Young jokes about the days when it took more time to get some companies’ financial statements than it did for Columbus to discover America. Alas, those days are still here.

Google May Reap $1 Billion Tax Benefit from Motorola Deal [CFOJ]
Robert Willens, an independent tax and accounting expert who is president of Robert Willens LLC in New York, told CFO Journal that the NOLs are “a really significant item.” The former Lehman Bsaid Motorola has about $3 billion in NOLs. While the IRS restricts the entire amount of NOLs that can be applied after a change in ownership, Google should still be able to use a portion of them over time. Willens estimates Motorola could reduce Google’s tax bills by about $1 billion over the next six years, on an undiscounted basis.

PwC faces fine over JPMorgan audit [FT]
After a year-long investigation into the audit firm, the Accountancy and Actuarial Discipline Board is taking disciplinary action against PwC for failing to meet the professional standards expected of it, and failing to report “with due skill, care and diligence”.

Memo to Staff: Don’t Panic [WSJ]
From company memos to “town hall” meetings, corporate leaders are looking at how they can jack up morale in the work place. At the same time, many are dealing with employees already skeptical of management—given the rounds of layoffs in recent years—and must choose their strategies carefully.

Interpublic sells half of its Facebook stake [FT]
Interpublic, the advertising group, sold half of its 0.4 per cent stake in Facebook for $133m to an undisclosed buyer. The sale is likely to put the spotlight back on to the secondary market for private company stock. The loosely regulated market attracted scrutiny from regulators earlier this year after shares in internet companies such as Facebook and Groupon began trading at multibillion-dollar valuations without public listings.

A war tax? It’s still not a bad idea [WaPo]
White House Press Secretary Jay Carney last Wednesday caught my eye when he talked about members of Congress, currently vocal about the deficit, who were on Capitol Hill over the past decade and voted for unpaid large tax cuts but “put two wars on the credit card without paying for them.” That last phrase reflected words used in 2007 by several House Democrats who wanted to institute a war surtax to pay for the then-increasing costs of U.S. activities in Iraq and Afghanistan. These days, one of them, Rep. Jim McGovern (D-Mass.), believes such a levy should be on the agenda of the debt-reduction “supercommittee.”

Corporations are people too! [Tax Update Blog]
Mitt Romney had a great time at the Iowa State Fair.

IRS: Woman claims 19 non-existent children [SVMN]
The IRS says Coronel claimed that all the children had been born to her at a Los Angeles hospital on Dec. 11, 2002, then obtained fraudulent Social Security numbers for them and claimed them as dependents. Hospital records show she gave birth to one child, a boy, on that date.

KPMG Foundation Awards $400,000 in Scholarships to 40 Minority Accounting Doctoral Scholars [KPMG]
The students include 10 new recipients and 30 students whose scholarships have been renewed. Each scholarship is valued at $10,000 and renewable annually for up to five years.

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.

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

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.

Is Obama Smart? [WSJ]
When it comes to piloting, Barack Obama seems to think he’s the political equivalent of Charles Lindbergh, Chuck Yeager and—in a “Fly Me to the Moon” sort of way—Nat King Cole rolled into one. “I think I’m a better speech writer than my speech writers,” he reportedly told an aide in 2008. “I know more about policies on any particular issue than my policy directors. And I’ll tell you right now that I’m . . . a better political director than my political director.”

Sales up at UK arm of Deloitte [FT]
The biggewas the consulting business, which increased its sales by 13 per cent to £517m, aided by the integration of acquired businesses and extra financial services work. Gains in market share lifted auditing revenues 4 per cent higher to £652m, the group said, while the tax and corporate finance divisions posted increases of 5 per cent and 11 per cent respectively. However, the average profit distributed to each partner fell 13 per cent from £873,000 to £758,000 because of the cost of making new hires and increasing pay to retain existing staff.

Markets Sink Then Soar After Fed Speaks [WSJ]
The Federal Reserve sent investors lurching from worry to hope as it warned that the economy would remain weak for some time but said it was prepared to take further steps to shore it up. The Fed’s statement, which included plans to keep interest rates near zero for at least the next two years, ultimately sent the Dow Jones Industrial Average up 4%, its biggest daily gain since March 2009. Yields on Treasury bonds dropped as investor demand pushed up prices.

For Murdoch, a Board Meeting With Friendly Faces [NYT]
One [director] is a former Goldman Sachs president who helped News Corporation broker mega-deals. Another is godfather to one of Mr. Murdoch’s grandchildren. Another ran Mr. Murdoch’s Australian subsidiary, News Limited. And those are just some of News Corporation’s directors who are designated as independent — chosen because they comply with regulations intended to ensure that companies maintain a layer of objective oversight.

NYSE Seeks to Tighten ‘Reverse’ Deal Rules [WSJ]
The New York Stock Exchange wants to toughen the standards that “reverse-merger” companies must meet to list on the Big Board, in the wake of accounting questions at many Chinese companies that have gone public via such transactions. The exchange is proposing a series of “seasoning” requirements that would effectively delay an NYSE listing for reverse-merger companies and set bars they would have to clear to obtain it.

BofA Doesn’t Need to Raise Capital, Finance Chief Thompson Tells Nomura [Bloomberg]
Bank of America Corp. (BAC), the largest U.S. lender, won’t need to raise extra capital to meet new international standards, Chief Financial Officer Bruce Thompson told Nomura Securities International analysts. The bank will be able to comply by cutting expenses, selling assets and letting some holdings decline naturally as they mature by the time the rules become fully effective, Thompson said in a meeting with analysts led by Glenn Schorr in New York.

A Much Needed Accounting Lesson for Two Senators [Accounting Onion]
Namely, Carl Levin (D-MI) and Sherrod Brown (D-OH).

People on the Move: KPMG Taps Chris Goodman as CMO [AdAge]
Goodman comes from Young & Rubicam and also did stints at Accenture and IMG.

Plante & Moran Elects 9 New Partners and One Affiliated Entity Member [P&M]
Six men and four women.

Swiss to Settle Tax-Evasion Dispute With Germany [Bloomberg]
Switzerland and Germany completed an accord to end a dispute over tax evasion by wealthy Germans holding cross-border accounts with Swiss private banks. As part of the settlement, Swiss banks will pay 2 billion Swiss francs ($2.8 billion) to the German government to cover the failure by their clients to disclose undeclared money in the past, the Swiss finance ministry said today in a statement.

Mad As Hell! [ZH]

China, U.S. vow to step up audit oversight cooperation [Xinhua]
Officials from China and United States have pledged to increase cooperation on cross-border audit oversight, China’s securities regulator said Monday, in the wake of a string of accounting scandals of U.S.-listed Chinese companies. The two parties aimed to improve the quality of auditing and accounting information of public companies, protect the rights of investors and assist in safeguarding of financial markets in both countries, the China Securities Regulatory Commission (CSRC) said in a statement on its website.

Damon Dash Talks $3 Million Tax Debt [MTV]
The once-flamboyant Roc-A-Fella Records co-founder Damon Dash is now in debt. In July, The Detroit News reported that the music mogul and Jay-Z’s former business partner owes almost $3 million in back taxes, according to a tax lien filed June 30. On Friday, Dash visited the “Sway in the Morning” radio show on Shade 45 and spoke to host and MTV News correspondent Sway Calloway about his recent troubles with the IRS. After being asked about owing “$2 million,” Dash quickly set the record straight: “I owe way more than $2 million in taxes. That must’ve just been the IRS,” Dash said, laughing, before admitting that he was in a bad space financially. “Nah, nah, I’m f—ed up.”

Rich say wealth managers not worth as much as accountants [Citywire]
Wealth managers and advisers might be dismayed to hear that 60% of high net worth clients would expect to pay an adviser less than their accountant, and do not believe investment management is good value for money. The findings form part of management consulting firm MDRC’s 2011 UK High Net Worth Report, which is based on contributions from more than 4,000 high net worth individuals and 600 ultra high net worths. The report also found that nearly 90% of respondents would expect to pay their financial adviser less than their lawyer.

IRS shows newly married gay couples no love [MSNBC]
For all those same-sex newlyweds in New York, Lawrence S. Jacobs has a message: Enjoy the Champagne and the honeymoon, but expect no gifts from the IRS. Jacobs, a lawyer in Washington, specializes in estate planning for same-sex couples — and in delivering the bad news that their unions aren’t legal in the eyes of the IRS, a policy that will cost them time and money during tax season. Same-sex couples in Washington, which last year legalized gay marriage, must fill out a federal return to make calculations required for their D.C. joint return. But then they must set that work aside and fill out separate federal returns because the IRS doesn’t regard their union as legal, Jacobs says. “You just spent decades getting your marriage recognized, and now the feds say, ‘No, you’re not,’” says Jacobs, who as a partner in a same-sex marriage has firsthand experience of the problem.

Small firms not happy with rising accountancy fees [Fresh Business Thinking]
According to new research 15% of small businesses say that rising fees is their biggest accounting gripe. The survey of 269 businesses by Crunch.co.uk, which questioned attitudes to and experiences of accountants, was carried out in July. Other top gripes were jargon, or ‘accountant-speak’, and charging for communication such as phone calls and emails — 18% combined agreed these were pet hates.

The IRS’ Amnesty Program for Foreign Account Holders: What You Need to Know [Reuters]
In case you have missed the recent press coverage on unreported foreign bank and other financial accounts, the IRS announced a second amnesty initiative earlier this year. The good news, if you have not already disclosed your foreign financial accounts, is that under the amnesty you can avoid criminal prosecution and get back into the system at a relatively low cost.

Almost 1,500 Millionaires Do Not Pay Income Tax [ABC]
At a time when America is borrowing about 40 cents of every dollar it spends because tax revenues cannot keep up with government spending, hundreds of America’s wealthiest households are paying no income tax at all. According to a recently released IRS report, almost 1,500 of America’s 230,000 millionaires avoided paying any federal income tax in 2009.

Cantor urges GOP to resist tax hike pressure after S&P downgrade [The Hill]
House Majority Leader Eric Cantor (R-Va.) told Republican lawmakers to expect — and resist — increased pressure to raise taxes following the downgrade of the U.S. credit rating by Standard and Poor’s. “Over the next several months, there will be tremendous pressure on Congress to prove that S&P’s analysis of the inability of the political parties to bridge our differences is wrong,” Cantor wrote Monday in a memo to House Republicans. “In short, there will be pressure to compromise on tax increases. We will be told that there is no other way forward. I respectfully disagree.”

AIG sues BofA for $10 billion over “massive fraud” [Reuters]
The insurer American International Group Inc (AIG.N) is suing Bank of America Corp (BAC.N) to recover more than $10 billion of losses from a “massive fraud” on mortgage debt, deepening the morass of litigation faced by the largest U.S. bank. AIG, still largely owned by taxpayers after $182.3 billion of government bailouts, is the latest of a growing number of investors filing lawsuits seeking to hold banks responsible for losses on troubled mortgages that contributed to the financial crisis.

US and China Fail to Agree on Cross-Border Auditing Standards [Business Insider]
On July 11-12, US regulators flew to Beijing in part to address the series of financial scandals of Chinese companies listed in America, but failed to agree upon a standard set of cross-border auditing standards with their Chinese counterparts. In an alphabet soup of acronyms, a U.S. delegation from the Securities and Exchange Commission (SEC) and The Public Company Accounting Oversight Board (PCAOB) and Securities and Exchange Commission (SEC) met with Chinese counterparts at the Ministry of Finance and the China Securities Regulatory Commission (CSRC).

Exclusive: Groupon Will Dump Controversial ACSOI Accounting in Amended IPO Filing [All Things D]
According to numerous sources close to the situation and after regulatory pressure, Groupon will amend its S-1 public offering filing to remove references to an unusual accounting treatment that has attracted controversy. Sources said the new filing by the social buying company, which is helmed by CEO and co-founder Andrew Mason (pictured above), will likely occur as early as Monday.

Less than zero: How companies can end up with negative revenues [Globe and Mail]
Even savvy investors are often puzzled at how some companies arrive at the bottom lines on their income statements. Now, as a result of ever more elaborate new accounting standards and complex corporate structures, the top line can be just as bewildering.

IRS auditing Louisville high school booster club [AP via Fox19.com]
The Internal Revenue Service is auditing a high school booster club’s books to find out why it has as much as $480,000 in funds that are unaccounted for.

MetLife Says 30 Jurisdictions Are Auditing Unpaid Benefits [Bloomberg via the SF Chronicle]
MetLife Inc., the largest U.S. life insurer, said more than 30 U.S. jurisdictions are auditing its practices in a review of whether the industry is holding unclaimed funds owed to policyholders, beneficiaries or states. The audits may lead to more payments to beneficiaries, administrative penalties or changes in procedures, New York- based MetLife said today in its quarterly filing with the U.S. Securities and Exchange Commission.

Google App Engine now officially secure [ZDnet]
The announcement got lost in the pre-weekend shuffle, but Google has announced that both the Google Apps cloud productivity and collaboration suite and the Google App Engine application platform have received the SSAE-16 security certification. If you can get past the alphabet soup, this news could open a lot of doors for Google in the enterprise.

SEC, Rajat Gupta Drop Their Cases, for Now [WSJ]
The Securities and Exchange Commission dropped its civil administrative proceeding against former Goldman Sachs Group Inc. director Rajat Gupta, but left the door open to pursue insider-trading charges against him in a civil lawsuit. The agency “is fully committed to the case and will proceed as appropriate,” a spokesman said Thursday. Specifically, the agency said that “it is in the public interest” to dismiss the administrative case but that “dismissing these proceedings will not prevent the Commission from filing an action against Mr. Gupta in United States District Court.”

Employers hire 117,000 in July; jobless rate slips to 9.1% [Washington Post]
Hiring picked up in July, the government said Friday, offering evidence that the nation is muddling through a period of very weak growth but not falling back into recession. Employers added 117,000 jobs last month, the Labor Department said Friday, compared with a revised 46,000 in June and better than the 85,000 net new jobs that forecasters had expected. The unemployment rate ticked down to 9.1 percent, from 9.2 percent in June.

FASB Meetings to Address Private Company Accounting Issues [Journal of Accountancy]
FASB said it is hosting two public round-table meetings in October to discuss issues relating to existing private company accounting and reporting standards. The meetings, scheduled for Oct. 11 and Oct. 17, will discuss issues including accounting and disclosure requirements relating to variable-interest entities, interest rate swaps and level 3 fair value measurements.

The auditing profession in Bangladesh: Turning the tide? [The Financial Express]
There were times when the auditing profession in Bangladesh used to draw a lot of criticism from the company directors, researchers, and popular press for their perceived failure to do their job as auditors properly; the quality of audited financial statements were questioned, and the role of the Institute of Chartered Accountants of Bangladesh (ICAB) in disciplining its members was challenged.

California taxes from businesses decline [The Orange County Register]
California businesses paid $85.4 billion in state and local taxes in the 2010 fiscal year, according to a new report from the Council on State Taxation and Ernst & Young LLP. California’s corporate income tax revenue declined 18% from July 1, 2007 through June 30, 2010, and its property tax revenue plunged 27%, reflecting the state’s real estate woes.

Does Connecticut Really Have Nation’s Lowest Business Taxes? [The Hartford Courant]
Connecticut businesses have the lightest tax burden in the nation, according to a new study that is being hailed by some as proof that companies are overly coddled by the state, and slammed by others as misleading and dangerous. The study done by Ernst & Young for the Council on State Taxation (COST) adds up the total amount of state and local taxes paid by business in each state — which was $6.9 billion in Connecticut in 2010. Each state’s total is then divided by that state’s total private-sector economic output, for a percentage.

E&Y beefs up its insurance team [The Royal Gazette]
Accountants Ernst & Young (EY) has announced three new appointments to its London and Bermuda insurance team. Paul Cooper, Simon Burtwell and Ben Reid have all been appointed to senior roles due to increased demand from its clients.

Audit of Alameda County assistance program reveals gross mismanagement [The Oakland Tribune]
An Alameda County audit of a now-defunct countywide assistance program shows hundreds of thousands of dollars in mismanaged grant money and questionable expenses — including money spent on alcohol, massages and dubious travel.
The audit of the Associated Community Action Program, commonly called ACAP, also confirms what former employees had asserted — a complete lack of oversight by the program’s governing board. That board was made up of one county supervisor and one elected official from every city in the county, excluding Berkeley and Oakland.

Should Internal Audit ‘Do SOX’? [Norman Marks via Sustainable Business Forum]
There is a sharp divide among internal audit professionals as to whether the internal audit function should play a significant role in the SOX program. In the first few years of SOX, management more often than not looked to internal audit as internal control experts to lead the development and implementation of the SOX program.

Rothstein Kass Appoints Three New Principals [PR Newswire]
Leading professional services firm, Rothstein Kass (www.rkco.com), today announced that Arthur Brown, Kashif Hussain and Daniel O’Connor have been named Principals in recognition of their ongoing contributions to the company’s success.

Analysis: Decades-old auditor ties under scrutiny in U.S. [Reuters]
Goldman Sachs has stuck with the same auditing firm since 1926, Coca Cola since 1921, General Electric since 1909 and Procter & Gamble since 1890. That’s going back 85, 90, 102 has relied on a different one of what are known today as the Big Four accounting firms. And now some U.S. accounting reformers are thinking that perhaps enough is enough: the time has come to rotate auditing firms.

IASB Chairman: IFRS Adoption Is in “Economic Interest of U.S.” [Journal of Accountancy]
Adopting IFRS would benefit the United States’ economy, the new chairman of the International Accounting Standards Board (IASB) said July 29 during his first official visit to China. Speaking to a gathering of the Ministry of Finance’s Accounting Regulatory Department in Beijing, Hans Hoogervorst said, “U.S. investors invest globally, and U.S. companies seek international capital, and it is in the economic interest of the U.S. to adopt IFRSs,” according to a copy of the speech posted on the IASB website. “IFRSs support economic growth and establish a high-quality level playing field for globalized markets.”

Audit reveals ‘very significant’ accounting woes in Granger [Yakima Herald-Republic]
Granger’s accounting problems are so serious that if not corrected, the city could miss out on future federal grants, according to the state Auditor’s Office. A state audit showed the city didn’t report $500,000 in federal grants and failed to provide complete and accurate financial reports.

Mergis Group Accounting & Finance Employee Confidence Index Dips [Sacramento Bee]
The Accounting and Finance Employee Confidence Index, a measure of overall confidence among U.S. accounting and finance workers, slipped 2.1 points to 50.0 in the second quarter of 2011, according to a recent survey of 3,833 U.S. adults among which 183 are employed in Accounting and Finance commissioned by The Mergis Group®, the professional placement division of SFN Group, Inc. The survey, conducted online by Harris Interactive®, reveals that fewer workers are confident in the strength of the economy and in the future of their current employer.

China’s Mutant Turtles [FT]
Our research shows that the poor quality of accounting in China is an extension of a poor governance environment, with its origins in China’s cultural, political, economic and legal systems. After decades of communist rule the state is still trying to establish its legal authority and is unable to enforce the law impartially. The result is that people resort to personal connections and private information to protect their business dealings.

Restoring trust and saving the U.S. credit rating [Chicago Tribune]
Our elected officials don’t follow the rules to enforce honesty that they require of the private sector, such as the standards of Generally Accepted Accounting Practices. If voters really understood this, they might remove them from office and put some of them in jail. Washington’s ways have evolved with a veneer of legal legitimacy, when in fact those ways increasingly resemble the corruption we deplore in lesser-developed countries.

Wanted: Missionaries with accounting skills [Baptist Press]
Accountants may not be the first image that pops into people’s heads when talking about missionaries, but that’s exactly how Grece, a Nebraska native, answered his call to missions. He uses his financial skills in the office while also focusing on ministering to those around him — whether it’s frazzled missionaries or local villagers.

Moody’s: IASB, FASB Accounting Standards Proposals Hitting Delays [PropertyCasuality360]
Proposed changes to insurance-contract accounting standards are running into delays amid vocal opposition, but whatever final conclusions ultimately emerge, they are unlikely to have a broad impact on credit ratings since new rules, by themselves, do not alter the economic position of an entity, according to Moody’s.

Official Washington’s Crackhead Accounting [The American Spectator]
There is no evidence that this bizarre deal of questionablee.g. the “Super Congress”) will actually lead to any real cuts. Nor is there any evidence that it will prevent the U.S. government from losing its long held triple-A credit rating. There is a promise of spending cuts, but overall federal spending will continue on its upward trajectory because Official Washington operates in the make-believe world of “baseline budgeting.” According to this crackhead accounting, both a cut and an increase may count as cuts.

State faults Binghamton’s accounting system [Sun-Bulletin]
The City of Binghamton’s accounting system lacks adequate controls to provide an accurate picture of city finances, an audit by the state comptroller’s office found. The 33-page report, released Monday, said the municipality has, among other things, overstated its general fund balance, has a city comptroller that hasn’t properly monitored certain accounts and has more than $13,000 in unaccounted funds from its parking operations.

Barclays to cut 3,000 jobs as profit drops [Reuters]
Barclays is set to cut about 3,000 jobs this year to reduce costs after a drop in bond trading and an insurance mis-selling charge cut first half profits by a third.

Money Funds Have Biggest Redemptions This Year Amid Debt Talks [Bloomberg]
Investors last week pulled more money from money-market mutual funds than any week this year as U.S. lawmakers failed to resolve the impasse over raising the debt ceiling. Withdrawals reached $37.5 billion, with about 70 percent of the redemptions coming from institutional funds that invest in U.S. government securities, according to data from the Investment Company Institute, a Washington-based trade group.

Accounting Departments Drive Demand for Electronic Document Management Solutions to Improve Bottom Line, According to IntelliChief [Benzinga]
IntelliChief LLC, the leading provider of document management and imaging solutions for the IBM i (System i, iSeries, AS/400), reports accounting department personnel are often both primary drivers and first adopters of paperless solutions in their companies. “Because of the cost savings to be gained by going paperless in accounting, and the bottom-line responsibilities that are top-of-mind with financial professionals, it makes sense that the demand for paperless solutions most often originates from within the accounting department,” says Brian Smith, IntelliChief Marketing Director.

No Day in Court for Bank Clients [WSJ]
Some small and regional U.S. banks are prohibiting unhappy customers from taking their complaints to court or joining class-action lawsuits, instead requiring them to resolve disputes through arbitration.

Preparing for New ‘Bottom Line’ on Leases [Memphis Daily News]
Obviously, the more significant a company’s leasehold interests are, the greater the impact of the new guidelines; for example, airlines, manufacturers and retailers. Additionally, regulatory rules will likely be impacted for banks and insurance companies. And, because the new guidelines deal with the accounting for leases on the balance sheet, the greatest impact will be on companies issuing audited financial statements.

Gone Fishing [Going Concern]
After two years of being chained to my desk and staring at my laptop, I’m taking a few days off (seven to be precise) starting Monday. I know, I know. Unacceptable. But after some arm twisting, TPTB figure that some vacation would give me a chance to relax and it offers them some reprieve from my kvetching about EVERYTHING. Plus when the country defaults on Tuesday I thought it might be safer to be in a Paris bistro while the rest of you fight over scraps in the streets.

Debt-Limit Deal to Get Congress Vote Today [SF Chronicle]
Many Californians ignore the “use tax” – the equivalent of sales tax but remitted by state residents for products bought from out-of-state retailers that did not collect sales tax. The state estimates that $1.1 billion in use tax goes uncollected every year. Cash-strapped California is eager to corral that big chunk of change, most notably through the “Amazon tax” bill that took effect in late June. The new law requires Amazon and other online sellers to collect sales tax, but is being fiercely fought by the e-commerce giant and its brethren.

HSBC to Cut 30,000 Jobs [DealBook]
HSBC, the biggest European bank, said on Monday that it was cutting 30,000 jobs as part of a wide-ranging cost cutting program to improve profitability. The job cuts, which would represent about 10 percent of HSBC’s work force, are part of a strategy to reduce expenses by $2.5 billion to $3.5 billion over the next two years.

Debt Ceiling, Spending Cuts to Rise But No Word on Higher Taxes [taxgirl via Forbes]
The agreement also allows for President Obama to raise the debt ceiling immediately up to $400 billion, heading off the “certain” Armageddon that pundits have been warning about (insert a lot of coughing here). An additional $500 billion in debt ceiling headroom has also been authorized although, as part of the deal, Congress specifically reserves the right to vote against that at a later date so that they can dutifully wag their fingers at the President. And the President has reserved the right to veto that vote so that he can wag a finger at Congress (you can pick the finger). Future increases have also been authorized, with limitations.

2011 AAA Annual Meeting [The Summa]
More than 3,000 accounting professors will be packing up this week, and heading for Denver. The American Accounting Association (AAA), the professional association for accounting professors, is holding its annual meeting, August 6-10.

XBRL: What’s It Good For? [CFO]
On July 12, XBRL US, a nonprofit consortium for XBRL (extensible business reporting language) standards, announced a contest with a $20,000 grand prize to be awarded to whoever submits the “most inventive and useful application leveraging XBRL-formatted data from the U.S. Securities and Exchange Commission (SEC) EDGAR database” for business benefit.

Companies Altering Compensation Plans Over Say-on-Pay [Compliance Week]
Many companies are making changes to their compensation plans, especially those that garnered lukewarm support or lower from shareholders and those that saw proxy advisory firms recommend that shareholders vote against their plans.

Accountants Moving From Hourly Rates To Fixed Fees [PR]
Over half of local accounting practitioners surveyed cite fixed fees as their primary means of pricing services, more than double hourly rate pricing.