Category: ANR

Accounting News Roundup: Dutch Minister Replacing Tweedie as IASB Chair; REMINDER: Nonprofit Deadline Is Friday; Panel Recommends Separate Board for “Little GAAP” | 10.12.10

Former Dutch minister picked as IASB chairman [FT]
“The head of the Dutch financial markets regulator has been given the pojob of running the body that sets the accounting rules followed in the European Union and an increasing number of other countries.

Hans Hoogervorst, a former Dutch finance minister, was on Tuesday named chairman of the London-based International Accounting Standards Board, which sets the IFRS accounting norms.

He will take on the job at the end of June 2011, succeeding Sir David Tweedie, the Scot who has occupied the post for a decade.

Mr Hoogervorst, chairman of the executive board of the Netherlands Authority for the Financial Markets, is not an accountant.”

I Can Afford Higher Taxes. But They’ll Make Me Work Less. [NYT]
Wherein we discover one more example of how tax cuts (or lack thereof) will affect someone.

Gap scraps new logo after online outcry [Reuters]
“GAP Inc scrapped a new logo on Monday just a week after launching it following an “outpouring of comments” online and from customers in support of the original blue box design it’s had for more than 20 years.

Gap rolled out an updated version of the logo last Monday on its website and planned to include it in its holiday marketing, a spokeswoman said.

But the company saw more than 2,000 comments on its Facebook page on the issue, with many people railing against the new logo and calling for a return to the old.”

Friday Is the Drop-Dead Date for Small Charities Wanting to Stay Tax-Exempt [Tax Update Blog]
You’ve been warned.


One Step Closer to Little GAAP [CFO]
“A blue-ribbon panel has recommended that a new set of accounting standards be drawn up for private companies based on U.S. generally accepted accounting principles. The panel also recommended that a private-company rulemaking board be established, separate from the Financial Accounting Standards Board, which currently writes and revises U.S. GAAP.

The details of how the rules will be developed — and how FASB and its parent organization, the Financial Accounting Foundation (FAF), will be involved in the process — will be outlined in a report issued in December, said panel chair Rick Anderson, chairman and CEO of accounting firm Moss Adams, during the panel’s fourth and final public meeting on Friday. The final product, often dubbed “little GAAP,” will be a pared-down version of the full set of rules, requiring fewer disclosures and less-detailed measurements of some assets and liabilities.”

Wal-Mart Lands Agreement to Sell iPad [WSJ]
“Wal-Mart Stores Inc. said it will start selling Apple Inc.’s iPad on Friday at hundreds of stores throughout the U.S.

Wal-Mart landed the tablet computer a little later than two of its largest retail rivals: Best Buy Co., which has been selling the iPad since its launch in April, and Target Corp., which began carrying it this month.

The Bentonville, Ark., retail giant said that what it lacked in timeliness it will make up for in sales heft. It vowed to slowly ramp up the number of U.S. stores carrying the iPad to more than 2,300 by the height of the holiday season in mid-November.

There will also be no Wal-Mart “rollback” price cut on the iPad: The tablets will sell for Apple’s suggested retail price, which starts at $499 for the cheapest version with 16 gigabytes of storage and wireless internet access but no 3G mobile connection.”

Accounting News Roundup: Chris Columbus Edition | 10.11.10

Ed. note: In observance of a day that reminds Italian-Americans and Native Americans that they are sworn enemies, we’ll be posting on a lighter schedule today. Let us know if anything exciting happens (shouting matches, faux-holiday layoffs, etc.) and we’ll manage to get something up. Back with a full slate tomorrow.

PwC clients asked to reveal information on internal accounting judgments [Accountancy Age]
“PwC auditors will ask audit chairmen to reveal more detail about internal accounting judgments on a voluntary basis. Andrew Ratcliffe, senior audit partner with PwC, said he was unsure how the audit chairs would react, but hopes to have more sensitive information in the public domain by February.

‘We will ask what are the key judgments and assumptions that the auditor discusses with the audit committee when he completed his audit,’ he said.”

Deloitte’s Phoenix partner moving to Los Angeles post [Phoenix Business Journal]
Michelle Kerrick makes a break for the L.A. OMP gig.

The Tragic Decline of Business Casual [Bloomberg BusinessWeek]
The bosses have had it up HERE with your liberal interpretation of the business casual dress code.

The Future of Fraud Investigations: A Guest Post From Tracy Coenen [Re: The Auditors]
Tracy Coenen drops in at RTA for a guest post.

Deloitte & Touche settles Kentucky Central suit for $23 million [Business First of Louisville]
“The Kentucky Department of Insurance has reached a $23 million settlement with Deloitte & Touche LLP, ending a lawsuit the state brought against the accounting firm for its dealings with the now-defunct Kentucky Central Life Insurance Co.”

Tax Masters [TaxProf Blog]


Is Obama Raising Taxes on the Middle Class? According to Joe Biden, Yes [Tax Foundation]
The Veep escaped and managed to say some things that aren’t so helpful with the President’s tax rhetoric.

Accounting News Roundup: Big Names Oppose Proposed Washington Tax; American Apparel Names Acting President; Oregon Gubernatorial Candidate Donates Home and Gets Burned | 10.08.10


SEC Accuses CHiPs Actor, Others Of Securities Fraud [Dow Jones]
“In complaints made public on Thursday, the SEC alleges that the actor, Larry Wilcox, and more than a dozen other penny stock promoters engaged in a series of kickback schemevolume and price of microcap stocks and illegally generate stock sales.

Wilcox, who starred as Officer Jon Baker on the long-running television show “CHiPs”, lives in West Hills, Calif., and is president and chief executive of The UC Hub Group, according to an SEC complaint filed in U.S. District Court for the Southern District of Florida.”

Microsoft, Boeing, Amazon Line Up Against New Washington Tax [Janet Novack/Forbes]
“The Washington State fight over whether to impose a new income tax on well-to-do residents heated up Wednesday, as the group opposing the tax released a list of employers that have joined the anti-tax cause. Companies on the list include Microsoft, Boeing, Amazon, Weyerhaeuser and Safeco Insurance.

The tax, which will appear as Initiative 1098 on the state’s November ballot, would impose a 5% tax on income of more than $400,000 per couple and a 9% levy on income exceeding $1 million per couple.”

Rep. Levin: Fate of Bush tax cuts unknown [On the Money/The Hill]
This does not sound good: “The Senate is expected to move first on the issue, but Levin said even that was not certain.

‘It’s preferable that the Senate act first because we’ve seen that if they can’t act first they won’t act second because the Republicans block it and don’t provide the 60 votes,; he said, adding, ‘I think we’ll have to wait and see.’ “

American Apparel names Tom Casey as acting president [Reuters]
Tom Casey just left the terminal case known as Blockbuster in August.

SBA Loans Jump, Despite Unsteady Year [WSJ]
“Small-business lending still hasn’t bounced back to pre-recession levels. But despite a rocky year, the number of loans backed by the Small Business Administration jumped about 30% in 2010.

The agency, which ended its fiscal year Sept. 30, says it approved $16.84 billion, or 54,826 small business loans, in the past 12 months. That’s up from fiscal 2009, when the SBA backed about $13.03 billion during the depths of the credit crunch. In 2007, the agency backed about $20.61 billion.”


Oregon Gubernatorial Race Roiled by Candidate’s Charitable Deduction for Donation of Home to Fire Department [TaxProf Blog]
You try and do something nice…

FASB Advances EITF Proposals on Goodwill, M&A [A&A Update/Compliance Week]
“The Financial Accounting Standards Board is proposing new updates to the Accounting Standards Codification around goodwill write-downs, business combinations, and revenue recognition for health care entities based on recommendations from its Emerging Issues Task Force.

In the proposal titled Intangibles – Goodwill and Other (Topic 350): How the Carrying Amount of a Reporting Unit Should Be Calculated When Performing Step 1 of the Goodwill Impairment Test, FASB and the EITF want to settle on one starting point for all companies to follow in deciding if goodwill needs to be written down.”

U.A.E. Drops Threat to Suspend BlackBerry [NYT]
Your vacation is back on.

Accounting News Roundup: Congress Delay on Taxes Could Hit January Paychecks; KPMG Settles with Hollinger; PwC Asking Clients to Share Internal Info | 10.07.10

Republicans See a Political Motive in I.R.S. Audits [NYT]
“Leading Republicans are suggesting that a senior official in the Obama administration may have improperly accessed the tax records of Koch Industries, an oil company whose owners are major conservative donors.

And the Republicans are also upset about an I.R.S. review requested by Senator Max Baucus, the Montana Democrat who leads the Finance Committee, into the political activities of tax-exempt groups. Such a review threatens to “chill the legitimate exercise of First Amendment rights,” wrote two Republican senators, Orrin G. Hatch of Utah and Jon Kyl of Arizona, in a letter sent to the I.R.S. on Wednesday.
ick to point out that the I.R.S. was put under tight restrictions about access to Americans’ tax returns as a result of political shenanigans by the Nixon administration involving tax audits.”

AIG’s Real Numbers Still Shrouded in Secrecy [Jonathan Weil/Bloomberg]
“Two years ago when the government seized control of AIG, the Treasury in effect took a 79.9 percent ownership stake in the company, through preferred shares and warrants it received as part of AIG’s $182 billion bailout package. By keeping its stake below 80 percent, the government ensured that a financial-reporting method known as push-down accounting wouldn’t be permitted under U.S. accounting rules.

The reason that was so important? Had AIG chosen to implement push-down accounting, it would have had to undergo a complete re-assessment of all its assets and liabilities. And, with a few possible exceptions, the company would have been required to begin showing them on its balance sheet at their fair market values, which may have left AIG’s books looking a lot worse.”

Delays to Tax Tables May Dent Paychecks [WSJ]
“Lack of congressional action on 2011 income taxes may force the Treasury Department to make unprecedented moves to prevent U.S. workers from seeing large tax increases in their January paychecks.

The issue: 2011 tax-withholding tables. Treasury officials usually release the tables, which determine the take-home pay of millions of wage-earners, by mid-November because it takes payroll processors weeks to adjust their systems before Jan. 1.”

Steven Bandolik Joins Deloitte’s Distressed Debt & Asset Practice [PR Newswire]
“Deloitte announced today that Steven Bandolik has joined its distressed debt and asset practice. Bandolik’s hire marks the latest in a series of strategic growth initiatives executed over the last 18 months to expand Deloitte’s distressed debt and asset practice.

‘Challenges need to become opportunities in order for borrowers, lenders and investors to move forward, and get back to their core business of making positive returns on investments. Despite lower interest rates, obtaining new financing regardless of loan performance continues to be an issue unless properties and financial positions are extremely strong,’ said Bandolik. ‘In this environment, clients require intellectual capital to re-structure transactions, and design sensible underwriting, due diligence and risk management procedures. Their debt may need to be structured more conservatively, requiring higher equity levels that could withstand future stress, with a focus on deleveraging over the holding period.’ “

Hollinger Inc.: Settlement of Claims Against KPMG LLP [Marketwire]
“The Litigation Trustee of Hollinger Inc. (“Hollinger”) announced today that he has entered into a settlement agreement with KPMG LLP to resolve all claims against Hollinger’s former advisor advanced by the Litigation Trustee on behalf of Hollinger. The settlement entails no admission of liability on the part of KPMG LLP. The terms of the settlement include releases in favour of KPMG LLP from Hollinger and its subsidiaries, as well as from third parties involved in related Hollinger litigation. The settlement and the releases are subject to court approval, which will be sought on notice to other affected parties. The rest of the terms of the settlement agreement are confidential.”


CAQ Reports on Fraud Best Practices, Launches New Effort [Compliance Week]
“The CAQ conducted five roundtables and 20 in-depth interviews to develop consensus on how companies can best create a financial reporting environment where fraud has little potential to seed or take root. The CAQ published the findings as a cornerstone to further collaborative efforts with other professional groups to share ideas and best practices on how to derail fraudulent financial reporting.”

PwC audit clients asked to give up internal information [Accountancy Age]
“Ian Powell, chairman of PwC told an audience of 300 business professionals, the audit model needed reform, and believed some internal discussions, now privately held between an auditor and company, needed to be made public.

‘It may well be that by making more of those discussions public, the value of an audit can be collectively improved,’ he said.

‘I have asked our lead audit partners to discuss this idea with audit committee chairs of PwC clients to see if we can work together on a voluntary basis to improve the disclosure of such matters over the next reporting cycle.’

The comments come as the European Commission prepares to release a green paper on audit competition, due later this month, and the House of Lords prepares to hear evidence on the issue, next week.”

Greenspan: Financial overhaul to have ‘significant impact’ on economic growth [On the Money/The Hill]
Some people are still listening to this man.

Madoff clan denies fraud role, seek suit dismissal [Reuters]
A consistent message may actually convince someone, some day.

Accounting News Roundup: Ernst & Young Reports Sluggish Revenues; Obama Shifting Tax Rhetoric; Wipfli Makes Another Acquisition | 10.06.10

Ernst & Young revenues fall slightly to $21.3 bln [Reuters]
“For the full fiscal year ended June 30, revenues were down 0.9 percent to $21.3 billion from $21.4 billion in fiscal year 2009, Ernst & Young said.

Revenues from advisory services grew by 2 percent, but other areas of the firm, including tax and audit services, posted declines.”

Goldman Sachs Says U.S. Economy May Be `Fairly Bad’ [Bloomberg]
Or ‘very bad.’ Either way, it’s there’s no good to be found.

Deloitte 2010 Annual Review: Reaching new heights, As One [Deloitte]
In coordination with the “We are the champions” announcement, D rolled out its annual glossy detailing what a bang-up year it was.

Obama’s Tax Pitch: Income Gap That Millionaires Should Fill [Bloomberg]
“President Barack Obama has shifted his central argument against the Bush-era tax cuts to make the income gap as much a voter concern as the budget gap.

Since Sept. 3, Obama has chided Republicans for wanting to extend tax cuts for “millionaires and billionaires” — a line he repeated in a morning television interview, a weekly radio address, backyard chats in Des Moines and Albuquerque, and three times during one speech at a community college in Cuyahoga County, Ohio. Before then, administration economists cast taxing the wealthy largely as a matter of fiscal prudence — a way to free up $700 billion from the deficit over the next 10 years.”


Wipfli acquires Illinois firm [The Business Journal of Milwaukee]
“Wipfli LLP, a CPA firm headquartered in Milwaukee, said that officers and associates of Rockford, Ill.-based Lindgren Callihan Van Osdol & Co. Ltd have joined Wipfli through an acquisition.

The transaction was effective Oct. 1 but was announced late Tuesday. Terms of the deal were not disclosed.

Lindgren Callihan Van Osdol, which was founded in 1963, specializes in audit, accounting and consulting services to businesses and to individuals. The acquisition is one of the largest in Wipfli’s history, said managing partner Rick Dreher.”

Karl Rove group, other tax-exempt orgs under fire for alleged political activities [Don’t Mess with Taxes]
Hard to believe that Karl Rove would be involved in anything shady.

Sun Chips Bag to Lose Its Crunch [WSJ]
YOUR LUNCH WILL BE QUIETER SOON.

Accounting News Roundup: KPMG’s Hiring Spree in Europe; Herz Gets Nostalgic; Stalemate on Estate Tax Could Benefit States | 10.05.10

KPMG joins Big Four hiring spree [FT]
The FT gives us the scoop on the Radio Station hiring bonanza in Europe (if you’re experienced go here), “KPMG is hiring 8,000 new staff across Europe over the next three years, signalling a recovery in the corporate services industry.

The hiring includes 3,000 staff in Britain, even though the UK government has pledged to cut its consultancy bill amid growing public unease over the billions of pounds spent on professional fees in the past decade.

The recruitment drive will take KPMG’s workforce from 30,0Europe, excluding France and Italy, and from 11,000 to 14,000 in the UK. KPMG also has ambitious hiring plans in France and Italy.

The corporate services industry had been hit by the global downturn, with the Big Four accountancy firms – KPMG, Ernst & Young, PwC and Deloitte – criticised for their role in signing off financial statements stuffed with assets that plummeted in value during the crisis.”

After Eight Years at FASB, Herz Looks Back [CFO]
Q&A with the man himself. Can you guess which accounting pronouncement he’s a big fan of?

Two Accounting Firms To Pay $1.7 Million To Settle CFTC Charges [Dow Jones]
“The charges stemmed from audits of Sentinel that were conducted between 2004 and 2006. The firms, McGladrey & Pullen LLP and Altschuler, Melvoin & Glasser LLP, agreed to pay $400,000 and $800,000, respectively, in restitution to Sentinel’s customers who suffered losses as a result of the Illinois-based futures commission merchant’s bankruptcy.

They were also required to pay civil monetary penalties of $150,000 and $350, 000, respectively, according to an order that was filed Monday. McGladrey & Pullen acquired assets related to Altschuler, Melvoin & Glasser’s audit practice in 2006.”

Ex-SocGen Trader Kerviel Convicted of Trading Fraud [WSJ]
” Paris court sentenced former Société Générale trader Jérôme Kerviel to three years in prison for his role in one of the biggest trading scandals in history, ordering him to repay a whopping €4.9 billion ($6.69 billion) loss suffered by the French bank.”

Investor Feedback Summary May Foretell FASB Retreat [Compliance Week]
“The Financial Accounting Standards Board may be sending up a smoke signal with an unusual missive describing how investors aren’t entirely in love with the board’s proposed new rules on financial instruments.

The board published a nine-page description of its interaction with investors regarding the FASB’s controversial proposal to call for more fair value in accounting for financial instruments. It opens with a reminder that FASB writes accounting rules to assure that financial statements produce information useful to investors, then explains how investors are reacting to the proposal when the board conducts face-to-face meetings with investors.”


State Estate Taxes: Windfall Gold in Expiring Tax Cuts [TaxVox]
States make out pret-tay well if Congress bumbles the estate tax.

U.S. hits AmEx with antitrust suit [WaPo]
“The Justice Department announced Tuesday that it had filed an antitrust suit against American Express for preventing retailers from offering customers discounts for using rival credit cards with lower processing fees.

Federal officials added that they had reached a proposed agreement with Visa and MasterCard over the matter.

The issue of ‘swipe fees’ has long been a thorn in the side of the retailing industry, which complained that it has little power to inform customers of the differences in card costs. In its complaint, the Justice Department estimated that the fees cost merchants $35 billion each year – resulting in higher prices for shoppers.”

LinkedIn and PwC Launch Breakthrough Career Mapping Tool for College Students [PR Newswire]
“LinkedIn, the world’s largest professional network with more than 80 million members globally, today launches Career Explorer in collaboration with PwC US, one of the largest employers of college graduates in the United States. The new LinkedIn Career Explorer tool provides current college students with unique, data-driven insights to help them build their careers.”

A Shift at the Top of Twitter [DealBook]
“Evan Williams, the co-founder and chief executive of Twitter, is stepping down to lead product strategy at the company, Twitter announced on Monday. Dick Costolo, the chief operating officer, will succeed Mr. Williams.”

Accounting News Roundup: Investigation of E&Y Over Lehman Begins in UK; Study: Mortgage Interest Deduction Doesn’t Increase Home Ownership; PwC Announces Revenue Numbers | 10.04.10

E&Y auditors investigated over Lehman Brothers [Accountancy Age]
“The Accountancy and Actuarial Discipline Board (AADB) has begun an investigation of E&Y in its role in reporting to the FSA on audit client Lehman Brothers International Europe’s compliance with the authority’s client asset rules, which govern the protection of client money.”

And since they were on a roll, the AADB is also investigating PwC for its role in J.P. Morgan’s misuse of client assets.

Study Finds the Mortgage Interest Deduction to be Ineffective at Increasing Owneref=”http://www.taxfoundation.org/blog/show/26762.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+TaxPolicyBlog+(Tax+Foundation+-+Tax+Foundation’s+%22Tax+Policy+Blog%22)”>Tax Foundation]
“Proponents for the MID often offer the justification that it increases homeownership rates, which they say has positive benefits for society. But most economists seriously question the benefits of MID and many believe homeownership is greatly over-subsidized.”

Visa, MasterCard Antitrust Decision by U.S. Said to Be Near [Bloomberg]
“The U.S. Justice Department may decide as early as this week how to resolve its two-year antitrust probe of merchant restrictions imposed by Visa Inc., MasterCard Inc. and American Express Co., three people briefed on the matter said.

The department still hasn’t decided whether it can reach a deal with the three biggest U.S. payment networks or challenge their policies in court, one of the people said. The department likely will file a lawsuit, and MasterCard and Visa are expected to settle, people familiar with the matter said.

The talks focus on rules that bar merchants from charging extra to customers who use credit cards and steering them to competing cards, and require retailers to accept every type of card banks issue, said the people, who requested anonymity because the discussions are private. The department is leaning toward allowing the companies to maintain prohibitions against surcharging, two of the people said.”

Will KPMG Ever Wake Up and Finally Learn Its Lesson after Being Duped into Completing Crazy Eddie’s Audits Too Early Twenty Three Years Ago? [White Collar Fraud]
Today’s lesson in duping auditors – Sam Antar explains exactly how he fooled KPMG (then Peat Markwick Main) into signing off on incomplete audits back in the 80s.

PwC takes $26.6bn in global revenues [Accountancy Age]
Thanks to the miracle of rounding, $26.6 billion puts P. Dubs in a tie with Deloitte for largest firm in terms of revenues, who reported the same number last month. This obviously will not stand and we will investigate the matter further to the appropriate number of significant digits to determine who the top dog is.


Citi says CEO, CFO “rebutted” Mayo’s criticisms in meeting [Reuters]
On Friday, banking analyst Mike Mayo met with Citi execs including CEO Vikram Pandit and CFO John Gerspach and they discussed, among other things, why Citi hasn’t been writing down their DTAs. Citi says that successfully rebutted the Mayo Man who is issuing a report today with his thoughts on the sit-down.

Accountant gets year-and-a-day in Petters scam [Minneapolis Star-Tribune]
“Harold Katz, the hedge fund accountant who doctored financial statements to hide the Petters Ponzi scheme from investors, was sentenced Friday to 366 days in prison after apologizing to family, friends and investors.

Katz, 43, will be eligible for parole in about 10 1/2 months. He was sentenced for conspiracy to commit mail fraud.

‘I made a colossal error in judgment,’ Katz told U.S. District Judge Richard Kyle. ‘I hope I can use this horrific experience to help others not make the same mistakes as I have.’

Katz created false financial statements at the behest of Gregory Bell, manager of Lancelot Investment Management, a Chicago-area hedge fund, to mislead investors about the stability of Petters Co. Inc., which was defaulting on various promissory notes as its decadelong Ponzi scheme unraveled in 2008. Katz also assisted Bell in making phony banking transactions with Petters Co. Inc. to make it appear the Petters Co. was paying off notes it owed to Lancelot.”

Accounting News Roundup: SEC at “Bottom of the Barrel” When it Comes to Diversity; More on Competition (or Lack Thereof) in the Audit Market; Define “Rich” | 10.01.10

SEC Plans to Hire More Women and Minorities Amidst Poor Rankings [FINS]
“At a recent panel discussion and networking event at the agency, Commissioner Luis Aguilar spoke about the need to hire ‘the best and brightest,’ while acknowledging that in the past it hasn’t done a good job of recruiting women and minorities.

In his speech, Aguilar said that as of FY 2009, 89% of the SEC’s senior officers were white, 4% African-American, 3% Hispanic and 2% Asian. Along gender lines, 67% of the officers were male and 33% were female.

Moreover, in a recent survey published by the Partnership for Public Service, the SEC fell from 11th to 24th place on a list of the ‘Best Places to Work’ rankings. With regard to diversity, the SEC ranked 24th out of 28 agencies when it came to diversity. In other words, the bottom of the barrel.”

PCAOB Fires Shot on Audit Issues, Calls for Enforcement [Compliance Week]
“The Public Company Accounting Oversight Board has published a report summarizing its observations after inspecting audits performed while credit market seized and the economy plunged into depression. The report says auditors generally didn’t adhere adequately to PCAOB standards when it came to some of the toughest areas in financial reporting through the credit crisis – namely fair value measurements, goodwill impairments, indefinite-lived intangible assets and other long-lived assets, allowances for loan losses, off-balance-sheet structures, revenue recognition, inventory and income taxes.”

Viacom Names New CFO [WSJ]
Controller James Barge succeeds Tom Dooley who jumped over to the COO seat.

Accounting niches [AccMan]
Are accountants doing enough to leverage their professional expertise?

Investors unhappy with lack of competition in audit market [Accountancy Age]
“The Association Of British Insurers (ABI), whose members account for almost 15 per cent of investments in the London stock market, is worried about the audit structure and said it has made its views known in a submission to a House of Lords inquiry into audit competition.”


H&R Block sees 5-cent hit from IRS policy change [AP]
Fewer rapid refunds doesn’t seem like a bad thing.

KPMG’s Fuzzy Math on Atlantic Yards [NYO]
The completion of the Atlantic Yards project remains on a timetable that runs parallel to the adoption of IFRS in the United States.

Tax the rich, whoever they are [Don’t Mess with Taxes]
Come out with your hands up!

Accounting News Roundup: AIG Rolls Out Repayment Plan; Wal-Mart Names New CFO; IRS Files Lien Against Sharpton | 09.30.10

AIG to Convert Preferred Shares Into Common to Repay U.S. [Bloomberg]
“American International Group Inc. agreed with U.S. regulators to repay its bailout by converting the government’s holdings into common shares for sale, a step toward independence for the insurer whose near collapse two years ago threatened the global economy.

The U.S. Treasury Department will convert its preferred stake of about $49.1 billion for 1.66 billion shares of common stock and then sell the holdings in the open market, AIG said today in a statement. Common shareholders, who hold about 20 percent of the company, will have their stake dilutent, the insurer said. Those investors will receive as many as 75 million warrants with a strike price of $45.”

Spain loses AAA status, stands firm on austerity [Reuters]
“Spain lost its final top-line debt rating on Thursday as the government sought backing from lawmakers for a budget it hopes will be austere enough to convince markets it can slash the deficit at a time of economic weakness.

Moody’s become the third and last rating agency to cut Spain out of the highest AAA category which has helped it finance its debt relatively cheaply. The one-notch cut had been expected and the agency said it hoped not to have to cut again soon, bolstering Spanish debt markets.

But the agency also said a poor growth outlook meant Madrid would have to take further steps to meet its deficit targets in years to come. The Bank of Spain said a sluggish recovery would slow further in the third quarter.”

IASB head knows all about cross-channel frictions [FT]
“In a decade spent overseeing international accounting standards, Sir David Tweedie has become an amateur student of French psychology.

The Scot has locked horns with France several times as head of the International Accounting Standards Board, the body that sets the International Financial Reporting Standards rules followed in the European Union and other countries.

His fascination for his adversary is such that he recently thrust into my hands an academic paper entitled “France and the ‘Anglo-Saxon’ Model: Contemporary and Historical Perspectives”. The article explores the hostility often felt in France towards the British and American way of doing business.”

McDonald’s May Drop Health Plan [WSJ]
“While many restaurants don’t offer health coverage, McDonald’s provides mini-med plans for workers at 10,500 U.S. locations, most of them franchised. A single worker can pay $14 a week for a plan that caps annual benefits at $2,000, or about $32 a week to get coverage up to $10,000 a year.

Last week, a senior McDonald’s official informed the Department of Health and Human Services that the restaurant chain’s insurer won’t meet a 2011 requirement to spend at least 80% to 85% of its premium revenue on medical care.”


Wal-Mart picks successor to longtime CFO [Reuters]
“Wal-Mart Stores Inc (WMT.N) named Charles Holley to succeed Chief Financial Officer Tom Schoewe, who will retire on November 30.

The world’s biggest retailer said on Wednesday that Schoewe, 57, will stay at Wal-Mart until January 31 to help with the transition.

Holley, 54, joined Wal-Mart in 1994 and is treasurer and executive vice president of finance.

Those credentials should make him a capable CFO, said Wall Street Strategies analyst Brian Sozzi, though Wall Street could view the transition negatively since it adds uncertainty.”

All We Are Saying Is Give Dick Fuld a Chance [Jonathan Weil/Bloomberg]
Names being floated to replace Larry Summers as the National Economic Council include Citigroup Chairman Dick Parsons and Xerox CEO Anne Mulcahy. Jonathan Weil sees where Obama is going with this:

“There’s much we can learn about the kind of person the president is looking for by studying these two contenders’ credentials. In addition to CEO chops, it seems Obama is seeking someone who also has served on the board of directors of at least one company that either had a massive accounting scandal, blew up so spectacularly that it threatened to take down the global financial system, or both.”

…and doesn’t think he’s aiming high enough. He has some of his own suggestions.

Memo to Media Departments: Here Are Three Ways to Make My Job Easier – rebuttal [AccMan]
Dennis Howlett’s rebuttal to Adrienne’s plea to PR types.

Sharpton faced with fresh tax woe [Tax Watchdog]
The Rev. owes around $538k to the IRS for 2009. His lawyer is a tad confused by the whole thing and says everything will paid up by Oct. 15th.

Accounting News Roundup: Grant Thornton Calls for ‘Regulatory Intervention’ in the UK Audit Market; FASB Member Betting on ‘Hyrbid’ Mark-to-Market Model; SAP Acquiring Sage? | 09.29.10

GT seeks limit on Big Four market share [Accountancy Age]
“Grant Thornton is calling for direct regulatory intervention in the audit market that would limit the number audits a firm could hold among public companies.

The call comes in a submission to the House of Lords economic affairs committee which is conducting an inquiry into the dominance of the Big Four firms and constitutes the most emphatic public demand yet for regulators to directly intervene in the market.

Among the other proposals made by Grant Thornton are a code of conduct for investors urging them to promote the use of auditors outside the Big Four. Grant Thornton also wants to see so called restrictive covenants – clauses placed by banks in credit agreements insisting that only Big Four firms be used on an audit.”

How Not to Create New Jobs [TaxVox]
“I suppose the Senate’s debate today may serve some useful purpose as a show vote. Endangered Democrats can go home and argue that while they care deeply about American jobs, Republicans–who voted en masse to kill the bill–do not. But partisan politics aside, this is a classic example why Congress should not be allowed anywhere near tax policy during election season.”

Mark-to-market plan could be modified: FASB member [Reuters]
“Strong opposition to a controversial proposal to expand fair value accounting could sway rulemakers to modify the plan, a member of the U.S. accounting rule-making board said on Tuesday.

The proposal by the Financial Accounting Standards Board calls for loans and other financial assets to be valued based on what they would fetch in the market, known as mark-to-market, or fair value. That change is intended to give investors a clearer picture of assets held on banks’ books.”

The banking industry has opposed the measure, saying it does not make sense to assign market prices to loans that will never be sold.

‘Thus far, I think the count is up to about 1,500 or so comment letters,’ said Lawrence Smith, a board member of FASB, which sets U.S. accounting rules. ‘I think I’ve read one that supports what we propose.’

Smith added that board members will probably be influenced by the opposition. ‘If I were a betting person, I would bet on some type of hybrid model being adopted,’ he said.”

BP to Create New Safety Division in Wake of Spill [NYT]
Now here’s an idea! ” BP will set up a new global safety division and make other changes to the way it operates as it seeks to absorb some lessons from the explosion of a oil rig in the Gulf of Mexico earlier this year, the soon-to-be chief executive Robert Dudley said Wednesday.

BP said the new division would aim to improve risk management and safety, and also review how the company manages agreements with contractors. The plans were announced as Mr. Dudley prepares to take over as chief executive on Friday.”

Investors, Regulators Laid Path to ‘Flash Crash’ [WSJ]
“A report by the SEC and the Commodity Futures Trading Commission on that day’s steep decline, which saw the Dow Jones Industrial Average collapse 700 points in minutes before rebounding, is expected as soon as this week. SEC Chairman Mary Schapiro has called the day’s events “clearly a market failure.”

Staff from both agencies, which provided an initial joint-account in May, continued Tuesday to negotiate how certain events would be described in the report, according to people briefed on the discussions.

One area of discussion, one person said, concerns the so-called “E-mini” futures contract, which mimics movements in the Standard & Poor’s 500 index and was a source of heavy trading that day when liquidity dried up. Part of the discussion concerns whether to disclose the number of contracts exchanged in the E-mini contract, which could show the size and impact of the trades.”


SAP to buy Sage? [AccMan]
Dennis Howlett mulls over the latest SAP/Sage rumors.

Voting on Bush Tax Cuts Divides Democrats in Congress Before Election Day [Bloomberg]
We realize it might be tough to get your head around this, “Democrats worried about defending congressional majorities are divided over voting on income taxes before Election Day. Party strategists warn they are missing an opportunity to define themselves against Republicans.

After Senate Democrats postponed action on President Barack Obama’s proposal to extend middle-class tax cuts until after the Nov. 2 election, House Speaker Nancy Pelosi suggested members still may vote this week before leaving Washington to campaign. Two days later, House Majority Leader Steny Hoyer said that would be a ‘specious act’ without the chance of a Senate vote.”

College Graduates’ Top Employers [BusinessWeek]
The latest from Universum: 1) Google 2) KPMG 3) E&Y 4) PwC 5) Deloitte. It’s really not fair if you let the cool company jump in the mix.

Accounting News Roundup: ‘Won’t Somebody Think of the Small Businesses?!?’; Facebook’s New Arbitrary IPO Date; Debunking The ‘Failure’ of Bush Tax Cuts | 09.28.10

Analyzing the Small-Business Tax Hysteria [You’re the Boss/NYT]
“The rhetoric on this subject has become counterproductive. It can’t be helping consumer confidence, and it’s certainly not creating any jobs. In what used to be a running joke on ‘The Simpsons,’ whenever trouble arose, Reverend Lovejoy’s wife would shriek, ‘Won’t somebody please think of the children?!!!’ The emerging counterpart to that cry in our real-life politics seems to be, ‘Won’t somebody please think of the small businesses!’ “

AOL in Talks to Buy TechCrunch [WSJ]
“A deal would mark a high-profile marriage between the Internet giant and one of Silicon Valley’s most high-profile blogs, which has often been discussed as a possible acquisition target.

It would also be the latest in a series of alliances between content and Internet companies, which are seeking to draw more users and advertisers by pumping out inexpensive articles on popular topics like fashion, news and sports.”

Facebook IPO likely after late 2012: board member [Reuters]
“Facebook, the world’s largest online social network, is likely to go public sometime after late 2012, a board member said, satisfying investors’ appetite for a slice of one of the Internet’s biggest growth stories.

A stock market debut by a company valued in the tens of billions of dollars would be one of the most highly anticipated initial public offerings of the decade.

But Facebook board member, venture capitalist and PayPal co-founder Peter Thiel stressed on Monday that will not happen until after late 2012, and would depend on the company hitting certain revenue targets and how its business model develops.”

Auditors Aren’t Forcing Full Repurchase Risk Exposure Disclosure [Re:The Auditors]
Auditors looking the other way for their banking clients. Again.

BlackBerry Maker RIM Enters Tablet Scrum [WSJ]
“RIM Co-Chief Executive Mike Lazaridis on Monday showed the device, dubbed the PlayBook, at a conference for BlackBerry developers in San Francisco. The PlayBook has a seven-inch touch screen and high-definition cameras on the front and back sides, but the device won’t connect directly to cellular networks.

RIM said its tablet won’t go on sale until early next year in the U.S. and the second quarter elsewhere in the world, meaning it will miss the key holiday season. The timing also puts RIM behind iPad competitors from Samsung Electronics Co., Dell Inc. and others.”


IRS won’t be mailing tax forms next year [AP]
They’re saving $10 million a year, presumably on stamps and envelopes.

News Corp. SVP Kevin Halpin named Dow Jones CFO [AP]
Kevin Halpin is taking the reins from Stephen Daintith.

Correlation Proves Causation, David Cay Johnston Edition [Tax Foundation]
“I agree with Johnston that tax cuts are not the correct response to every economic situation, and I do not believe that letting the Bush tax cuts expire would cause an economic armageddon. If the federal government’s proclivity for deficit spending can’t be curbed by reducing tax revenue – the ‘starve-the-beast’ approach – then permanently extending the Bush tax cuts for any and all taxpayers is a worse policy than letting the cuts expire because the country will drive off the fiscal cliff even sooner.”

Accounting News Roundup: Southwest Loves AirTran; PCAOB Starts Negotiations with European Counterparts; Debunking the ObamaCare Tax on Home Sales | 09.27.10

Southwest Airlines to Buy AirTran [WSJ]
“Southwest Airlines agreed to acquire AirTran Holdings Inc. for $1.4 billion in cash and stock, the first major merger among healthy U.S. discount carriers.

The proposed deal follows Southwest’s failed effort to acquire Denver-based Frontier Airlines earlier this year and would revive its stalled efforts to launch international services by accessing AirTran’s network to the Caribbean.”

Troubling Trades Found Ahead of Flash Crash [DealBook]
“The Chicago data firmed strange patterns — dubbed “crop circles” — in stock market data around the flash crash on May 6 has put together a new analysis that it says backs the theory that one or more trading firms was intentionally trying to flood exchanges with orders.

The firm, Nanex, hopes the Securities and Exchange Commission and the Commodity Futures Trading Commission will be able to address its analysis in their long-awaited report on the flash crash due to be published before the end of this month.”

Treasury Said to Prepare AIG Exit, Repayment Plan [Bloomberg]
“The U.S. Treasury Department may announce plans as early as this week to return American International Group Inc. to independence and recoup taxpayer money from the insurer’s bailout, according to three people with knowledge of the talks.

The biggest part of that strategy is for Treasury to begin converting its $49 billion preferred stake into common stock for sales by the first half of next year, said the people, who declined to be identified because the negotiations are private. The timing of an announcement depends on the pace of talks between regulators and the New York-based insurer, and discussions may extend beyond this week, the people said.”

PCAOB Begins Negotiations With European Regulators [Compliance Week]
“Now that Congress and the European Union have removed a big obstacle to international audit inspections, the Public Company Accounting Oversight Board is trying to forge some new relationships with its counterparts overseas to get back on track.

PCAOB spokesman Colleen Brennan said the board is beginning to negotiate with various audit regulators in Europe to see how it can proceed in each country inspecting audit firms that audit financial statements in U.S. capital markets. The board is hopeful it can reach bilateral agreements with individual regulators to perhaps gain access to work papers that will enable the board to fulfill its inspection mandate under the Sarbanes-Oxley Act.”

IRS Offers Olive Branch to Business [CFO]
“The Internal Revenue Service has taken taxpayers’ comments to heart and revised its proposal on uncertain tax positions, in a way that is much more favorable to corporations. The final Form 1120, called Schedule UTP, and its instructions eliminate two draft requirements that companies argued were particularly onerous: the calculation and inclusion of a maximum tax adjustment for each position, and disclosures around positions that are not subject to an accounting reserve.

IRS Commissioner Douglas Shulman announced the release of Schedule UTP on Friday, in a speech delivered to the American Bar Association in Toronto. The agency has instituted a five-year phase-in period for filing the schedule, said Shulman.”


Job Interview Is Where Most Mistakes Are Made, According to Survey [FINS]
If you make a faux pas during an interview, rather than faint consider five suggestions that FINS has to keep your hopes alive.

PwC names industry leaders and academics as non-execs [Accountancy Age]
“Dame Karen Dunnell; Sir Ian Gibson; Professor Andrew Hamilton; Sir Richard Lapthorne; and Paul Skinner and come from the fields of business, academia and the public and professional services sectors.

They will sit on a newly-formed public interest body where they will be joined by partners fo [sic] the firm but have a majority.”

Cloud Computing: What Accountants Need to Know [JofA]
A crash course.

Finding Surprises in the Small-Business Jobs Bill [You’re The Boss/NYT]
“Most of the controversy surrounding the small-business jobs bill that cleared the House of Representatives on Thursday — after nearly a year of discussion — concerned a $30 billion small-business lending fund to be established by the Treasury Department.

But like most of the legislation, the lending fund is a temporary fix. It will make investments in banks for just one year. The tax breaks in the bill, worth about $12 billion, are mostly good for a year or two.”

Dodd-Frank Lets Small-Company Auditors Off the Internal Controls Hook: Putting a Partial Lid on the Sarbox [Re:Balance]
Jim Peterson reflects on Dodd-Frank’s ‘get out of jail free’ for small company filers.

Would “ObamaCare” (Health Care Reform) Tax the Sale of Your Home? Probably Not. [Tax Foundation]
“There has been a story and an e-mail floating around for some time claiming that the recent health care reform bill (PPACA) would impose a 3.8 percent “sales” tax on the sale of every home. The e-mail has been rightfully debunked by the usuals (Factcheck.org and Snopes), but here is what the bill would actually do regarding taxation of the sales of homes.”

Pastors Defy IRS On ‘Pulpit Freedom Sunday’ [ABC News]
“The pastors, along with the Scottsdale, Ariz.-based nonprofit Alliance Defense Fund, planned today’s event as a reaction to a law stating that churches are not allowed to support politicians from the pulpit, according to the ADF.

The growing trend is a challenge to the IRS from the churches, and may jeopardize their all-important tax-exempt status. But some pastors and church leaders said they are willing to defy the law to defend their right to freedom of speech.”