Yesterday the Journal got into the ranking act with their list of colleges based on recruiters’ preferences. The accounting program rankings aren’t too surprising but we called in the friendly HR professional and recruiting maven Dan Braddock to discuss the rankings. First things first however – the pecking order:
5. Penn State
10. Ohio State
What follows is my chat with Dan-o as he tries to break this do rong>: Okay, let’s kick this off. You sent me a link to some WSJ article about the school rankings based on recruiter opinions.
CJN: I did. Personally, I find it hard to take the list too seriously without Texas-Austin or Notre Dame on it.
DWB: It makes perfect sense as to why they’re not on the list.
CJN: Explain, that sounds like crazy talk.
DWB: This isn’t based on caliber of program; it’s a list of what recruiters find to be the “best” schools. Take a look at the list of Best Accounting Schools. First, those schools are huge; many of them are state schools. Recruiters get the most “bang for the buck” out of schools like this. Second, if you mapped these out, they’re schools that can can service as feeder programs for multiple offices. For example, Deloitte can visit UCLA and find potential candidates for their California and west coast offices. This removes the necessity to visit several smaller schools across the same geogrpahic region. Penn State services Philly, Pittsburgh, D.C., Baltimore, New Jersey, and New York City. Lehigh University in eastern PA is a much better accounting program than Penn State, but has a smaller geographic reach and a smaller pool of students.
CJN: But doesn’t the #1 school, BYU, buck that idea completely? Their enrollment is small by comparison and Salt Lake City is a relatively small market
DWB: BYU has more than 25,000 undergrads from every state in the country – again, national reach.
CJN: Fine but why no UT? The Texas market is huge and has national reach.
DWB: I admit, Texas is the one school that I was shocked not to see on the list – on the surface, it is large in size, has a well respected business program, and is nationally known. But dig deeper and it makes sense. Of their 38,000 undergraduates, only 8.5% are from outside the state of Texas. So applying that same percentage to the number of undergrads in the business school (4,500) that’s about 380 students. How many of them study accounting? My guess is not many. That said, accounting students interested in offices elsewhere (Chicago, LA, NYC) should have no problem landing interviews, as the local Texas recruiters from the Big4 blanket UT at Austin.
CJN: And Notre Dame? Why are they MIA? John Veihmeyer has to be pissed. And not just about the choke against Michigan.
DWB: Hahaha. I’m sure he voiced his frustration about both. He’s probably having nightmares about the most recent flop in South Bend. Again, it’s all about size of program. National name, yes, but when your business program is ~2,500 students in total…Also, remember that these rankings for best accounting programs is not just by Big 4 recruiters. This is everyone. Johnson&Johnson, regional mortgage firms, Disney, etc.
DWB: Obviously there is some kind of balance in play here. As a whole, all of these schools are nationally known and well respected in the industry; there are no schleps on the list. For recruiters, it’s all about efficiency of time and finances. A hotel room and flight to visit a school where hundreds of accounting students are salivating at the opportunity to work for you is impossible to pass up.
CJN: So everyone on this list belongs on it or are there other schools that are missing that should be in the top…11 (?)
DWB: Considering their proximity to one another I was suprised to see both the U of Minnesota and U of Wisconsin on the list but no, nothing too surprising. Since it is college football season, the Big Ten definitely has the SEC beat when it comes to accountants (6 v. 0 on the list). Maybe that’s why they’re better on the gridiron.
CJN: OR maybe it’s because it’s the SOUTH. My guess is that people don’t go to Vandy to get an accounting degree.
DWB: I am surprised not to see a school from the South – no UNC Chapel Hill
CJN: Fair point.
DWB: In closing, I think it goes to show that US News & World Report rankings are not the end all be all for recruiters. Nationally known names, established programs, and large alumni bases go a long way.
CJN: Right. And a good football team doesn’t mean shit (read: Alabama).
DWB: Below the belt, CN.
CJN: Whatevs. Can you explain the pachyderm? B/c I sure as hell can’t.
If the GOP took the “think of all the trees you’re killing” angle, maybe they could have convinced more Democrats to kill the 1099 free-for-all. Unfortunately, they stuck to the usual “red tape is un-American and stealing our freedom” narrative and it didn’t impress.
Senate Democrats defeated an attempt by Republicans to lift a tax-reporting requirement that small businesses face in a move that would have stripped away $17 billion earmarked to help pay for the sweeping health-care law.
In a 46-52 vote, the majority overcame an effort by Senate Republicans to scrap the reporting requirement which was inserted to the health-care legislation that was signed into law by President Barack Obama earlier this year.
The Republicans would have needed 60 ‘yes’ votes to be successful. Seven Democrats sided with the Republicans to support removing the requirement.
The Republican effort was led by Sen. Mike Johanns (R., Neb.), who has argued it is simply piling on unnecessary red tape on small-business owners at the same time as the federal government looks to them to lead the job-creation recovery.
The rule requires businesses to report to the Internal Revenue Service payments to suppliers and service providers that exceed $600 in a single year. It is set to be implemented in 2012.
Continuing on with “list season” Accounting Today’s Top 100 Most Influential People in Accounting launched late last week and while there are plenty of new names, it’s still a bit of a snoozer since this particular list isn’t a ranking like say, the Vanity Fair 100. See, the VF100 establishes a pecking order that can be antagonized over for days and weeks and just about when everyone is done giving a shit (or long after), the new edition comes out and people can rage on how last year’s list was so much better.
No, the AT100 is more like People’s 50 Most Beautiful issue. Not in the sense that you want to see these 100 accountants, politicians, professors, etc. etc. in the buff (or do you?) but that the influence (or the beauty) is subject to your own, er, tastes. Anyhoo, enough with the fluffing, let’s get on with it.
Rick Anderson, Chairman and CEO, Moss Adams (new to list in 2010)
C.E. Andrews, President, RSM McGladrey (new to list in 2010)
Bob Bunting, President, IFAC
Paul Caron, Dean of Faculty and Charles Hartsock Professor of Law at the University of Cincinnati College of Law
Stephen Chipman, CEO, Grant Thornton (new to list in 2010) – All the blogging paid off!
Dan Goelzer, Acting Chair, PCAOB (new to list in 2010)
Michelle Golden, Founder, Golden Practices Blog
Tom Hood, CEO and Executive Director, Maryland Association of CPAs
Jack Weisbaum, CEO, BDO (new to list in 2010)
Dropped from last year’s list:
The list has its usual suspects including all the big dogs from all of the Big 4, Tim Geithner (get over it AG), Doug Shulman, Barney Frank, etc. etc. but there were some interesting honorable mentions (so to speak) on page 11 right next to Dennis Nally’s picture. Just so you know.
Accounting Today 100 Most Influential People In Accounting [Digital Version (registration required)]
While Wes continues to fight his conviction (sometimes using unorthodox methods) on tax evasion tooth and nail, Ken Starr is ready to get on with it and pleaded guilty today to charges related to his Ponzi to the Stars.
Government sentencing guidelines have Starr looking at 10 to 12.5 years which is long enough to outlast the appeals that Willie Mays Hayes has out there.
Since we’re not at all familiar with how convicts are assigned their prison quarters, our desire for an awkward reunion between Snipes and Starr that includes debating over who gets the top bunk is merely wishful thinking. If it lightning stirkes, we’ll just chalk it up to the gods smiling down on us all.
Many finance departments would grind to a halt if forced to do without spreadsheets. They’re quick, easy and inexpensive tools for manipulating and analyzing data that just about anyone can master.
However, these attributes also mean that spreadsheets create a tremendous risk, particularly if their results are incorporated into the company’s financial reports or used to support a business’ operations.
With this in mind, the Institute of Internal Auditors (IIA) in June issued GTAG (global technology audit guide) 14, a guide for auditing what it calls “user-developed applications,” or UDAs. While spreadsheets are the most visible type of UDA, the term also can include applications like user-developed databases and reports. UDAs are “…created and used by end users to extract, sort, calculate, and compile organizational data to analyze trends, make business decisions or summarize operational and financial data,” the IIA states.
By their nature, UDAs present three types of risk. One is data integrity – the old “garbage in, garbage out.” User developed applications don’t follow a structured application development cycle, and lack any sort of change management or version controls – that is, any number of individuals may be able to update a spreadsheet. All this increases the risk of inaccurate data making its way into the application.
Next is the risk that confidential data is compromised. Many UDAs can easily be attached to an email and sent to someone who shouldn’t have access to the data.
Finally, there’s what the IIA calls “availability risk.” Because many UDAs reside on flash drives and individual PCs, they’re easy to overlook when the company is backing up data. Or, the information can easily be lost altogether.
Internal auditors can take several steps in their audits to reduce the risks any UDAs in use pose to their firms. A starting point is identifying key UDAs. These typically are those that are part of the financial or management reporting processes, or use to comply with regulations. One-off spreadsheets used on an ad-hoc basis probably aren’t key.
The auditors also need to assess the risks posed by the key UDAs. To understand this, they’ll need to know who uses the applications, and how. From this, they can estimate the financial, operational and regulatory risks the UDAs present. The more complex the applications are, the more embedded they are in organizational processes, and the greater their complexity, the more risk they present.
Next up is examining the controls in place around the UDAs to determine if they reduce the risks to an acceptable level for the organization.
Spreadsheets and other user-developed applications play a valuable role in many organizations. At the same time, they can expose companies to a great deal of risk. Appropriate management and control is critical to mitigating the risks they present.
A US pastor says he is not “backing down” from plans to burn copies of the Koran on the anniversary of 9/11, despite international outrage.
“We are not convinced that backing down is the right thing,” said Terry Jones of 50-member Florida church, the Dove World Outreach Center.
Actually, we have no idea if Terry Jones has an accountant in his congregation but IF HE DID you would hope he would consult an expert on these matters. May we recommend this:
“Wally” Bock isn’t sure what you want from him, MSNBC, New York Post, Daily News et al. He’s trying to run a half billion dollar fortune of a lady who doesn’t want to leave the friendly confines of Beth Israel Hospital.
He can’t be bothered with trivial matters like whether Irving Kamsler pleaded guilty to sending porn to adolescent girls. And besides! It wasn’t even his call.
In his statement to appease the haters, Bock wrote, “I was never in any position to fire Mr. Kamsler; that decision was Ms. Clark’s alone. I did insist that he disclose his conviction to Ms. Clark, which I understood he did.”
How about that for an awkward conversation? It’s not like going door to door in North Hollywood telling everyone you’re a pederast but explaining to a 100+ woman that you sent porn to some teenage girls might make for a few uncomfortable silences. But Bock claims Clark was cool with it, so you best not get all judgey about it.
Plus, he got to keep his CPA. Although the past has show that the New York Office of Professional Discipline isn’t really too concerned with timely action.
As you’re no doubt aware, this past Saturday the college football season began and on Sunday the NFL kicks off their season. For many of you with a pigskin-crazed significant other, this means that you won’t be seeing much of him or her on the weekends for the rest of the year.
This also means that thousands of hours will be wasted by (primarily) men at work and in their free time, antagonizing over the players on their rosters* and coming up with lame trash talk for their upcoming opponents. For the most part, the gajillion of dollars lost in productivity and the strain put on relationships is accepted by society (there are exceptions).
Football is more of a religion than any of the faiths these days anyway. Plus, we’re fairly certain that men sitting on their asses while ingesting meat and watching freakishly obsese men (and a few athletes) sacrifice life and limb is all but guaranteed by The Constitution. Fantasy football is a mere extension of this phenomenon.
Anyway, there has to be a king of this geekfest of stats, laptops and greasy food and his name is John Rozek. And he is an accountant.
More technically, Rozek is “king of fantasy football by the World Championship of Fantasy Sports, the big dog in big-money, faux-football leagues.” The World Championship of Fantasy Sports (“WCOFS”) will be awarding $2 million in prize money this year which should allow some of the big winners to actually get laid.
Rozek (who won $25k last year in various leagues) doesn’t claim to be a guru, just smarter than the born losers he plays against, “You have to take advantage of people not making the best picks,” he told the Trib. “And you can’t fall in love with players.”
This really shouldn’t surprise you one iota. Looking over a mess of seemingly meaningless numbers, maintaining objectivity, impervious to distractions like spouse, kids, etc. when its busy and/or football season is what accountants so good at their jobs in the first place. It’s like revealing that an accountant is the best at stamp collecting (we’re sure it’s a fine hobby) or a World of Warcraft champion. Most people’s reaction would be, “Meh. I could’ve guessed that.”
*Full disclosure: I am in one league and my team will be dominating this year.
A couple weeks back the AICPA gave its members the go-ahead to Crtl+C, Crtl+V its letter to the IRS about how certain parts of the proposed tax preparer regulations were a load of crap.
We just assumed that everyone in the accounting biz was on the same page here but boy we’re we wrong. The National Society of Accountants sent this letter to Treasury honcho Geithner stating that they don’t want any tax preparers exempted from obtaining a PTIN (among other complaints):
What’s especially interesting is that the AICPA is not named in this letter once, however they are named specifically in the NSA’s press release:
Now, at the 11th hour, just before the registration process is scheduled to begin, some – including the American Institute of CPAs – are demanding that staff members of ‘CPA firms’ be exempted from the registration requirements. This flies in the face of why this registration program was set up. The point of the new regulations is to ensure that all tax preparers are accountable for their work in preparing returns, and that should include anyone who paid to prepare all or substantially all of a return, no matter where they may work.
The basic tenet here is that big firms will get away with letting the underlings preparing the returns not be held accountable for their (apparently) shoddy work. The NSA’s position is that if every single legit tax professional is registered then they can track down the shitty ones and the IRS can act accordingly. The NSA claims that the “loophole” proposed by the AICPA will let these amateurs skate the testing and registration requirements and thus won’t be serving taxpayers one iota.
On the one hand you might have been totally against the tax preparer regulations from the start but now that they’re unavoidable, the AICPA’s request for exemptions in some cases may burn the unlucky bunch that wouldn’t get to enjoy waiver.
~ Calling it a day people. We’ll be back Tuesday to help you cope with the post-holiday depression.
Why the SEC Won’t Flip the IFRS Switch [CFO]
We approve of prognostication in all its forms.
Bernanke Says He Failed to See Financial Flaws [NYT]
About as close to a “my o get from the Beard.
Who is short selling Medifast stock? [Fraud Files Blog]
A show of hands, please.
H&R Block Surges as Chief Says Firm Can Handle Mortgage Refunds [Bloomberg]
“Concern about potential losses tied to buybacks of home loans ‘is not based on fact,’ and reserves to protect the company against claims ‘are adequate,’ Chief Executive Officer Alan Bennett said yesterday during a conference call about fiscal first-quarter earnings. The call included repeated queries about claims, which have totaled more than $680 million.
‘There’s nothing that we’re seeing anywhere that would lead to the kind of phone calls we just listened to other than speculators that, in my mind, have probably sold our stock short and then stirred this up,’ Bennett said in an interview after the call. Mortgage buyback claims ‘are getting better,’ he said.”
The Truth About SAS 70 [CFO]
They’re worthless. Well, not completely.
I.R.S. Looks at Finances of Planned Parenthood [NYT]
“The criminal division of the Internal Revenue Service is looking into the finances of Planned Parenthood Golden Gate, while the organization has brought in forensic accountants to evaluate its books.
The local nonprofit became Golden Gate Community Health on Friday, as the national Planned Parenthood organization stripped the Bay Area clinics of their affiliation, citing financial and administrative problems.”
Paul Hogan cleared to return to U.S. [CBC]
Mick is safe.
Peter Orszag Goes From the Obama White House to the New York Times [Daily Intel]
“Apparently, what that Times opinion section needs is another liberal-leaning economist to cheerlead for progressive economic policies from the White House — or one who provides another visible tie between the two institutions.”
Under the hood [NYP]
Tim Geithner gets the giggles and might have Tourette’s; Larry Summers called the shots on GM/Chrysler fiasco and NEWSFLASH: Rahm Emanuel says “fuck” a lot.
Finally some good news for KB Home.
The homebuilder said the Securities and Exchange Commission has concluded its investigation into the company’s accounting and disclosures and does not plan to recommend any enforcement action. The letter from the regulator concludes the SEC’s investigation, which began in October 2009.
“We are pleased to announce that the SEC has concluded its investigation,” said Jeffrey Mezger, president and chief executive officer of KB Home, in a statement.
There are no details about the nature of the allegations.
Same was true in October 2009 when the company first announced in its quarterly report that the staff of the SEC notified the company that a formal order of investigation had been issued regarding possible accounting and disclosure issues. At the time, it stressed that the probe should not be construed as an indication by the SEC that there has been any violation of the federal securities laws.
And this is exactly how it turned out.
What were the allegations? What prompted the SEC to look into the matter? Was it a disgruntled whistle-blower?
The answers would be instructive to other companies that could wind up as targets of SEC probes. Guess we’ll never know.
The good news here is that the SEC informed the company that the investigation was closed. Sounds basic, right?
Believe it or not until a few years ago the regulator did not often communicate to companies under investigation that the probe was completed and that no further action would be taken, leaving the company hanging and suspicion hovering for all potential customers and investors to speculate.
Their attitude at the time was that as a policy, the Commission does not disclose the existence of an investigation in the first place, so it typically won’t announce that one has ended.
KB Home, however, is no stranger to controversy.
The company was embroiled in the options backdating scandal. In April, former chief executive officer Bruce Karatz was convicted by a federal jury of four felony counts, including two counts of mail fraud, one count of lying to company accountants and one count of making false statements in reports to the Securities and Exchange Commission. He was acquitted on 16 other charges.
In September 2008, Karatz agreed to pay $7.2 million to settle civil charges for his role in the stock-option backdating scheme that benefitted himself and other KB Home officers and employees.
Last November, a Texas homeowner filed a class-action lawsuit today against KB Home, Countrywide Financial and LandSafe Appraisal Services, claiming the three conspired to rig housing prices in Texas and Colorado, costing home purchasers millions of dollars and pushing homeowners into dangerous loans.
Earlier, a lawsuit filed against the same parties alleged they fraudulently inflated sales prices of KB homes in Arizona and Nevada.
Or a loudmouth neighbor depending on your political preference. Either way you look at it, 5 Times Square won’t be the same.
Giuliani Partners, the consulting business formed by the former mayor shortly after he left City Hall, has vacated the flagship office it had on a floor of the Ernst & Young offices in Times Square for nine years, consolidating space with the ex-candidate’s law practice, sources confirm.
Giuliani Partners closes Times Square office [Maggie Haberman/Politico]
This means you PricewaterhouseCoopers. You’re acting like this convergence/IFRS adoption is just happening too fast, well, Tweeds isn’t having it.
As for you companies out there that actually have to keep their books in tiptop shape, Sir Tweeds isn’t so amused by your bellyaching either. And for the love of God, would everyone quit playing dumb:
“Let’s look at what we’ve got out there at the moment – leases, revenue recognition and insurance. If you’re not an insurance company you’ve got two. Big deal,” he said.
“I’m not terribly sympathetic. It’s not as thought these have sprung out of no where, we’ve been working on these, they’ve seen the drafts coming, they know what we’re doing.
Furthermore, maybe if you got some of your people on this instead of writing a comment letter every two seconds, this wouldn’t seem like such monumental task.
“It’s tough, but goodness it’s tough for us too. We can’t keep getting all this advice. We always get conflicting advice. ‘You must have these done by June 2011, but don’t give them to us all at once’,” he said.
Tweedie “not terribly sympathetic” to concerns of standard-overload [Accountancy Age]
[caption id="attachment_16785" align="alignright" width="260" caption="He's a pervert, dude"][/caption]
Maybe! That’s what the Manhattan’s DA office would like to know.
In a story that Dick Wolf is certain to get ahold of, an accountant – who is admitted perv – and a lawyer are being “probed” for their management of a wealthy heiress’s fortune.
You see, Irving Kamsler – the accountant – apparently got bored managing multi-millions for copper heiress Huguette Clark and got to poking around on the Internet. He ended up pleading guilty in 2008 and was sentenced to probation, “for engaging in sexual Web chats with detectives whom he believed were girls as young as 13 and sending porn to one of them,” (plot-line twist!).
Presumably Kamsler was out of hobbies and he refocused his energy on managing the money of Ms. Clark.
Kamsler, along with Clark’s attorney, Wallace Bock, have been overlooking the heiress’s fortune for years but now the Manhattan District Attorney’s office was curious why the “elderly eccentric” had spent ‘forever’ (according to one aide) at Beth Israel hospital.
This all came about after MSNBC got to wondering aloud about Huguette’s whereabouts. More or less asking, “Why on Earth is she in a dingy hospital (have you been to Beth Israel?) and not in her 42-room 5th Ave. apartment or sprawling estates in Santa Barbara or Connecticut?”
The DA’s probe into whether Kamsler and Bock were properly managing Clark’s money is ongoing but if you’re going by Kamsler’s looks alone, you can easily conclude that they’ve got every reason to be suspicious.
I.R.S. to Drop Suit Against UBS Over Tax Havens [DealBook]
UBS is finally dropping those 4,450 names it owes the IRS and skates past the civil charges.
3PAR Accepts Revised Dell Takeover Bid [WSJ]
“3PAR Inc. on Friday accepted an increased, $1.8 billion takeover offer from Dell Inc., a day after Hewlett-Packard Co. raised its offer in a bidding war for the data-storage company.
Dell’s revised offer matches H-P’s Thursday bid of $27 a share for 3PAR, whose software helps companies manage and store data more efficiently.
The fight over 3PAR illustrates how important it has become for tech companies to dominate the emerging technology known as cloud computing, in which data are managed and accessed over the Internet. Dell and H-P both sell storage products and see 3PAR’s assets as important additions to their portfolios as large technology companies seek to serve all the needs of corporate-technology departments.”
When Litigation Kills the Accounting Profession-Don’t Say You Weren’t Warned! [FEI Blog]
Jim Peterson of Re:Balane guest posted over at FEI Blog where he discussed his speciality – risk surrounding the Big 4.
PricewaterhouseCoopers Trying To Buy Consulting Revenue Again With Diamond Deal [Re:The Auditors]
Francine McKenna discusses PwC’s recently announced purchase of Diamond Management & Technology including whether some of Diamond’s consultants bailed early to avoid becoming a cog in the another public accounting firm, “Did some of the employees bail out before they were signed on as sterile strategists for an ineffective firm struggling under the weight of consulting ‘leadership’ with audit-shaped heads? I know for sure that there were significant groups of BearingPoint consultants that would have rather masticated glass shards than work for a public accounting firm again.”
Official Statement [Roni Deutch: The Tax Lady Blog]
Roni Deutch says Jerry Brown, California’s Attorney General-cum-Democratic nominee for Governor, is playing election year politics. Seems plausible.
Finance Execs React to Herz’s Retirement [CFO]
No one is panicking.
SEC vows more actions over crisis [FT]
The FT is finally getting to the story about the SEC bringing more actions, changing the culture with new teams, yada, yada, yada. Except not everyone is buying it, “[S]everal judges have questioned the SEC’s deals with Citigroup and Bank of America, and some plaintiffs’ lawyers believe the regulator has been too soft.
‘There’s no real difference now to what it was like before Mary Schapiro became chairman,’ said Jacob Zamansky, a lawyer for investors and longtime SEC critic.”
Boeing Postpones Dreamliner Delivery Until 2011 [WSJ]
You’ll have to come up with a different Christmas gift for the boss this year.
It was revealed this week that Facebook is valued by its private shareholders at over $33 billion, more than Ebay, Yahoo and Dell. For a private company with little more than a year of revenue this is extraordinary.
When the company goes public it will have a hard job living up to this valuation without a significant increase in revenue streams.
One option may be for it to do a transformational transaction prior to its listing. In this way it could incorporate a pumped up revenue stream into its high IPO valuation. One such deal could be for it to buy ING Direct US, the largest online bank in the country.
Under the terms of the Dutch government bail out, ING has to sell ING Direct in the US and Canada by 2012. They will have no shortage of bidders from the financial world, but could it make sense for a non-bank to actually buy the company? And if so, what about Facebook?
Half a billion people now live their online lives through Facebook. It has huge brand value and customer loyalty. For it to generate revenue streams it needs to do more than just offer up ads and sell games.
To get from being a social network site to a commercial network site it needs to drive business, and one of the biggest impediments to online retail business is payments. By owning a bank-and thus a payment platform–Facebook could make it very easy to transact online.
Clearly there would be lots of legal hurdles for such a deal to happen, not least because regulators do not like non-banks owning banks. More specifically, Facebook has had difficulties in the past respecting people’s privacy.
But by allying the huge number of people on the site with an easy to use payments and banking business, Facebook could revolutionize its business and the way that 500 million conduct personal commercial activities on the web.
It could also learn from the clever people at ING Direct about how to protect customer data. It may be a long shot, but the two companies could complement each other very well.
From the mailbag:
Thought you’d be interested in hearing that today RK had a few last minute “transitions” or as most know them “lay offs”, these happened in the FS practice in New Jersey about 6 weeks after the official “transition date” in which upper management stated that the “transitions” were over for the year and everyone was safe and could get back to work and not worry. Today we lost 1 supervisor, 1 pending manager and 1 manager all having started their careers home grown at the firm.
Performance reasons were quoted but no one seemed to have a clue it was coming and a pretty big bummer day. Rumor has it that it’s not yet over as some others were not in the office today, doesn’t help the extremely negative morale issue going on at this firm with doom and gloom expectations of raises coming post labor day.
Would love to see some more RK news hit the site from time to time if you get it, not really sure where the firm is heading, up or down and would be great to see what others think??? FS practice is getting demolished in NY and NJ appears to be getting more antsy with every move that management makes.
A voicemail and email to Rothstein Kass spokesman Robert Solomon were not immediately returned.
If you’ve got more info on cuts or other news at RK, get in touch.
Fox Business Network’s ace news-breaker Charlie Gasparino reports that Citigroup’s management team, including CEO Vikram Pandit and CFO John Gerspach will not meet with CLSA banking analyst Mike Mayo since he’s been telling investors that the big C should be writing down their $50 billion in deferred tax assets.
Carlito reports that Mayo states that this refusal to write down the DTAs amounts to “cooking the books by inflating its earnings through an accounting gimmick.”
Simple question from Mayo via CG, “I’d like to know why all my competitors get meetings with Pandit and the key people there and I don’t.” It’s not like the guy is one of the top banking analysts in the entire world. It’s not like Citigroup has a solid track record of transparent financial reporting. Or did everyone forget that C has the U.S. Treasury as its backstop?
The KPMG audit team can weigh in on this at any time. Or just email us the details.
~ Update includes comment from IFAC President Robert Bunting of Moss Adams
Maybe! After all, anything’s possible. The Herz retirement wasn’t exactly expected but since Roberto had two years left in his terms but it’s been suggested that it’s been a rough two years since Barney Frank gave him the tongue lashing of his life over the whole mark-to-market thing.
Regardless, The Journal put it out there that the timing of Herz’s departure causes hella handwringing, most notably on the convergence efforts:
FASB will now have to replace Mr. Herz at the same time that the IASB is already cessor to its chairman, David Tweedie, whose terms expires in June 2011. This means that both bodies will have new heads as they enter what could prove to be the end game for the often-thorny process of converging two accounting standards.
This, of course, causes the U.S. GAAP Hawks to squeal with glee and those in pro-IFRS camp to get anxious and will likely lead to heavy lobbying for a replacement that will keep Tweeds dream alive for “one high quality set of global standards” or whatever they’re calling it these days.
Despite the Journal’s anxiety, International Federation of Accountants President Bob Bunting sees the change as an opportunity and things will continue to progress, “While the changes of leadership at the FASB and the IASB offer the opportunity for a fresh look at the convergence process, I would be surprised if any radical change in direction occurs,” Mr Bunting wrote in an email to GC, “The financial market forces and public interest arguments for convergence of the two standards, and possible eventual adoption of IFRS as a single standard continue to be very strong.”
However, since the FASB is expanding back to seven members, that will likely slow the process down (which makes some people happy) even further, especially with empty seats at the table:
The lack of a full board is likely to slow many of FASB’s projects, particularly the move to converge with international rules, said former FASB Chairman Dennis Beresford. “They’re not going to issue anything important on the basis of having only four board members,” he said, adding that Mr. Herz’s departure came as “a complete surprise.”
So, with those seeds of doubt planted, let’s put it to a vote.
Yesterday we learned that FASB Chair Bob Herz would be ending his spectacular 8 year run as the head of our favorite accounting standards setting agency.
What we have not learned is who will be replacing him permanently when he escapes next month. In the interest of helping FASB come up with a qualified replacement, we have a few suggestions. Do we need to submit these in comment letter form or can someone just email over for us?
Patrick Byrne Listen, we know there’s something just not right about the guy and it’s entirely possible that he lacks the actual paper qualifications required of the FASB chair. But to his credit, he can do wonders with financial reporting, especially when it comes to using magical fantasy models very similar to FASB’s own mark-to-Disneyland initiatives. He’d be great for coming up with all sorts of helpful guidance (except when it comes to internal control, he might have to contract out to the IASB on that one) and if the IASB decides to get too lippy, Byrne can simply send Judd Bagley after Tweedie’s ass to “straighten him out,” ifyoufeelme.
Willie Nelson Okay, so we’re pretty sure you have to take a drug test before you’re allowed to run the FASB but assuming Willie can get his hands on some goldenseal, we think we have a winner here. He’s laid back enough to handle hard ribbings by Barney Frank in the event of another bank accounting debacle and who knows, we could put off convergence another 15 years if we can send Nelson over to the IASB with some goodies. They’ll be too busy watching Chapelle’s Show and hunting down Doritos to start messing with the sanctity of GAAP. Win.
The hot chick who got fired from PwC Let’s be real about it, the FASB chairman job used to be an esteemed position but now that we’re trudging ever-forward towards convergence (or, rather, total IASB domination), we don’t actually need anyone with more than half a brain in that position. So why not offer hot chick a job? Qualifications include: standing there looking pretty, keeping your trap shut and ignoring Tweedie’s midnight sexting.
If you have a suggestion, why not let us know? We’ll be sure to include it as an aside in our next comment letter. Whoever they get, can we please PLEASE make sure they slightly more photogenic than our buddy Bob? Seriously, we’re going to miss you, Herz, but man did you make us all look bad.
Eight “successful” years is a helluva run, Bob. Not sure if he’s upstaging Tweedie’s exit next year or what. They’re buds and all. So now the speculation should probably start as to who will replace Roberto. Leslie Seidman will be running things as the “Acting” Chair and if you take the PCAOB’s as example, that “Acting” Chair can sit tight for awhile. Dan Goelzer has been “acting” as the Chair for over at the Board for over a year now.
So the important question is, who’s next to fly this ship? Taking shit from bank lobbies enerally being known as being the biggest double-entry nerd in a gray suit this side of the pond is not an easy gig. We’d suggest a deputy accountant but there’s probably some silly qualifications that she will disqualify her. Does Tim Flynn put down the bag at KPMG? Do we finally get serious and get a knight to run this thing? Suggestions welcome.
NORWALK, Conn.–(BUSINESS WIRE)–The Board of Trustees of the Financial Accounting Foundation (FAF) today announced that the Financial Accounting Standards Board (FASB) will grow from five to seven members. The FASB previously operated with seven board members from its inception in 1973 until 2008. In addition, Chairman Robert Herz has decided to retire from the FASB after more than eight years leading the standard-setting board. FASB member Leslie Seidman has been appointed Acting Chairman, effective October 1, 2010.
“Returning the Board to the seven-member structure will enhance the FASB’s investment in the convergence agenda with the International Accounting Standards Board (IASB), while addressing the unprecedented challenges facing the American capital markets in the months and years ahead”
“Returning the Board to the seven-member structure will enhance the FASB’s investment in the convergence agenda with the International Accounting Standards Board (IASB), while addressing the unprecedented challenges facing the American capital markets in the months and years ahead,” said FAF Chairman Jack Brennan. “The FAF Trustees believe this is the right investment in the standard-setting process at the right time that will enable it to accomplish the many duties that are so critical to the organization’s constituents.” The transition to a seven-member board will occur as soon as the process to recruit and evaluate candidates is complete, which is expected in early 2011.
Mr. Brennan added: “On behalf of the Board of Trustees and, especially, all investors and others affected by the FASB’s work, I want to offer my sincere thanks to Bob Herz for his strong leadership of the FASB in, arguably, the most challenging period in its history. We greatly appreciate his service and congratulate him for a job well done. Moving forward, we are very fortunate to have a highly respected, experienced leader like Leslie Seidman to assume the duties of Acting Chairman.”
Robert Herz, Chairman of the FASB, said: “My more than eight years as Chairman of the FASB have been among the most professionally challenging and personally satisfying of my career. There are hundreds of people I need to thank for their strong support and invaluable contributions to our standard-setting activities. First and foremost, I offer my deep appreciation to my fellow board members and our dedicated and talented staff. I’m very proud of our accomplishments, and I’m confident the board will continue to successfully meet the challenges ahead.”
Ms. Seidman has been a FASB member since July 2003. She has also served the FASB in various staff roles. Prior to joining the board, Ms. Seidman managed her own firm, providing consulting services to major corporations, accounting firms and other concerns, and previously served as vice president of accounting policy at J.P. Morgan & Company. Ms. Seidman started her career as an auditor in the New York office of Arthur Young & Company (now Ernst & Young LLP) and is a certified public accountant.
Last month we told you about how the American Bankers Association encouraged anyone that disagreed with the FASB’s proposed fair value rule to write a letter telling Herz & Co. how much the proposal su ind enough to provide a template for said “FASB Blows” correspondence so the anti-fair value crowd could get the gist of what needed to be said.
The ABA did warn, however, that the FASB hates, loathes, DETESTS form letters, so in order to make a valid point, it was advisable to not simple slap your name in the appropriate place but to articular your own special brand of hatred for the FASB.
As you may recall, many ABA groupies did not heed this warning, which no doubt resulted in Bob Herz and the rest of the Norwalk team using the letters to stoke their mid-summer weenie roast bonfire.
As disappointed as the ABA must have been with the lack of originality, we were sent this shining example that has been making the rounds at the Big 4 (or so we’re told). Our guess is that this is more of what the ABA had in mind:
Bravo, James C. Blaine. Bravo. You are most definitely into the brevity thing. You have, presumably, made the ABA proud. But wait, there is a pro-fair value letter worthy of these pages.
Granted, it was written back in May but Brian Cowell is no less passionate than Mr Blaine:
Nicely done, both of you. Everyone take note.
This morning we mentioned the Deadspin story that presented leaked financial statements of several Major League Baseball teams. This included the Pittsburgh Pirates who have had 18 straight losing seasons yet remain profitable – making $14.4 million and $15 million in net income for the fiscal year ended October 31, 2008 and 2007 respectively.
The Seattle Mariners financials are also now available and the Texas Rangers numbers will be rolling out tomorrow, so there’s plenty of financial analysis treasure hunting for you to engage in, if that’s your thing.
F is is unprecedented access to the teams’ financial position and performance, PLUS! all the wonky details of their Summary of Significant Accounting Policies – everything from revenue recognition to prepaid signing bonuses, guaranteed contracts, so on and so forth.
However, it also includes details that give insight into MLB controversial revenue sharing program, such as the Pirates using $44 million in ’07 and ’08 to develop players, as reported by the New York Times. With the lowest payroll in baseball and perpetual loserness, baseball fans in the Steel City might rather see that money spent on some free agents so they have something to discuss between the hockey and football seasons.
But perhaps more importantly, the Times reports that MLB is not taking this breach lightly. Since these teams are privately held, the information is not widely shared and the suspects are few:
Access to the teams’ audited financial statements is usually limited to the commissioner’s office; baseball’s lead bankers, Bank of America and JPMorgan Chase; and two accounting firms, Ernst & Young and PricewaterhouseCoopers. But [Florida Marlins President David] Samson said that “in the course of business, other entities have access.” Teams do not see one another’s financial reports, but receive a general accounting of where they rank compared with the other 29 clubs in profitability.
Of course this is the point in the post where you’d expect us to point the finger at E&Y or PwC but in reality, it seems unlikely that the leak would come from either firm. Likewise, it doesn’t make much sense for it to have come from BofA or JP Morgan. All these firms no doubt boast the services they provide to Major League Baseball and any professional servicing those clients wouldn’t dare risk damaging their firm and their career by exposing sensitive financial data of such a high profile client. Does it really make sense for an E&Y/PwC/BofA/JPM employee to leak the financials to Deadspin on a whim?
The leak has to be from within the commissioner’s office. First of all, someone there has the access to all these records and it is extremely more likely that Deadspin has sources in the commissioner’s office that would be willing to leak the information (especially teams no one gives a shit about). Secondly, we shouldn’t forget that baseball has had its share of squealers. There’s no reason to believe that the whole sport isn’t infested with them.
And as we mentioned – who gives a shit about the Pirates, Mariners or Marlins? These are low payroll teams whose financial information doesn’t cause much of a stir other than the fact that this is first time the data has been available to the public at large. If someone really wanted to bomb the hell out of us, the Yankees, Red Sox and Cubs financial statements would have been leaked and then the disparity (financial and thus, competitiveness) between the teams would really on display.
Recent data suggests that most of you sending emails regarding the person most likely to sleep their way to partner, the hot piece of ass that isn’t pulling their weight or a recruit from a certain school that asks less-than flattering questions about your firm, are getting way with passing it along to their friends and/or colleagues.
That being said, it does happen. One in twenty to be precise. Speaking from personal experience, sometimes people are reading your emails, especially if something goes viral within a firm and happens to sneak outside the firm. That’s when TPTB get on the horn and demand that people are held responsible.
Hey, nobody’s perfect right? When my particular reprimand came down, all I could do was laugh and say, “Yep, I did send that. Hell, it’s says “From: Caleb Newquist” right there. It was a bad decision on my part and I understand you have to do what you have to do.” And I moved on. Besides, I wasn’t the only one. It was communicated to me that literally hundreds of people were being reprimanded for forwarding the message so it was largely a damage control project and plenty of people were being told, “Don’t do that again. Ever.”
But for the most part, it sounds like most of your “inappropriate messages” fly beneath the radar, including:
Inappropriate jokes, angry messages sent in the heat of the moment, and scathing email replies forwarded to the wrong people are among some of the email gaffes that have landed office workers in hot water with their employers or clients.
One in five of those questioned said they had sent an inappropriate email in the heat of the moment, while almost a third said they had accidentally hit “reply all” instead of “reply”.
More than one in 10 of the 2,000 people surveyed admitted they had mistakenly sent an email criticising a colleague to the person they were insulting.
So while the Telegraph makes a point to note that 1 out of 20 people have been reprimanded for accidentally saying “God, can you believe the partner’s B.O. today?” in the “heat of the moment” it also shows that 19 people are having a great time sending inappropriate emails and not having any problems at all.
However, if you’ve been caught red-handed sending a dirty joke and/or discussing your booze-fueled business trip that may or may not have involved a party back at the hotel room, and were later asked to explain yourself, we’d love to hear about it below. And of course, send us any and all future inappropriate emails that would be 100% appropriate for these pages.
Not that we’re suggesting that you use your work email in an inappropriate manner. You’re representing your firm after all. Have the common sense to use a different email address.
Recent data suggests that Wall Street types are still doing drugs with unsurprisingly regularity but their tastes have changed with the seriousness of the times.
That is, they’ve traded in the hard-charging llelo fueled days of ’06 – ’07 with a more reserved and apathetic ganja attitude of ’09 – ’10. Trading coke for pot. Blow fo e all know that accountants follow/chase the money so we can safely assume that their proclivities for drug usage have followed suit.
However, you rarely hear about drug abuse problems at accounting firms. So where is all this drug use happening? Apparently, it’s going down at REITs:
The highest levels of abuse seem to be at real estate investment trust companies, a sector that, incidentally, does more random testing than others.
But the test results generally capture drug use among new hires, candidates who knew that they would likely be tested. Random drug testing is rare, according to a spokesman for a bulge-bracket bank who asked to remain unnamed.
Among existing employees, psychologists and counselors say that drug abuse has not slackened. Some even say it is peaking, exacerbated by the credit crisis and the volatile and tenuous recovery that has ensued.
As the article states, random drug testing is already rare but where it happens the least isn’t mentioned.
But like we said, you rarely hear about the drug use that goes on at accounting firms. Which makes us wonder if it’s because it’s not happening period. To our knowledge – accounting firms don’t give employees drug tests as a condition of employment and simply defer to clients who require them (a certain Swiss Bank with proximity to shroom burgers comes to mind).
We’re not suggesting that every Big 4 office is like Bernie Madoff’s north pole but there’s enough of it happening that there is a presence within the firms.
It’s no surprise. You Big 4 types (and anyone at a CPA firm for that matter) go through your personal hell on a seasonal (or maybe a constant) basis so there’s probably a direct correlation with your usage and the time of year. For example – that tax manager that manages to work night after night after night with amazing focus as the final 2010 deadlines draw near? You think they just plug themselves in when they finally go home to recharge for the next day?
Plus, as you’re acutely aware, it’s not just the illegal drugs that are popular, “[T]he rage these days is a Pez dispenser with the head of a red devil. Inside? Pills of Oxycodone or Percocet.” And don’t forget the people that have been popping Adderall since college so they can study for 12 straight hours. That has simply carried over into the 14-15 hour days for X amount of consecutive days during busy season.
And don’t get us started on people who get addicted to fast food (a drug in its own right) in order to save time and eat at their desks. The chemicals in the food from [pick your chain] are just as addictive as any drug off the street or from the pharmacy and cause just as much damage to our bodies.
But as you’ve no doubt heard over and over in the peanut gallery, getting your work done is ultimately what matters. Come hell or high water. Come dependancy, insane weight loss or insane weight gain. And lots of people do whatever it takes to cope with that reality.
So? What’s the scoop these days inside your firm? Are drug tests just a section of your offer letter that you agree to, only to be never reminded of it again? Anyone every been tested? We understand that no one is operating heavy machinery out there but bad things can still happen, quite possibly in the name of client service.
The Beckhams were concerned that “ordinary people were tightening their belts,” so what did they do? They fired a bunch of ordinary people! All it took was a shrewd accountant to tell them, “You’re pouring money down the drain.”
The fun-killing accountant is then quoted by a source in The Sun that employing 50 people around the word isn’t necessary, ” ‘You CAN afford to employ all of these people. But why the hell DO you?’ ”
Vic took it to heart, so she cut 14 people off the payroll. This included a housekeeper that worked for them for eight years who was replaced by “two ‘cost efficient’ foreign staff,” so things aren’t completely falling apart.
As for the gardening, they’re down to one and now that poor bastard has to double as a chauffeur. Can you imagine the hell that must be having that guy track muddy shoes into the car? The horror.
Last week we touched on the shockingly sensitive subject of charging time while traveling. You see, apparently it was (at one time) a-okay in some KPMG offices (Southeast) while in others, the mere idea of charging time while traveling was utter nonsense.
So that got one reader to thinking – what the hell else is being cut out these days?
Please consider a post related to fringe benefits. I’m curious in knowing whether the larger firms are allowing their employees to keep points for dollars spent on company credit cards. But there are other points programs (i.e., frequent flyer miles) and fringe benefits (i.e., gym memberships, cell phones, etc.) that may be declining on top of all of the poor raises.
Big 4 firms have been quite generous with the fringe benefits (e.g. elderly parent care, subsidizing public transit passes, etc.) and they make a point to remind you of it from the day you interview with the firm to the day you leave. However, since we’re living in unprecedented times, nothing is unheard of.
If your firm has recently gotten stingy on fringe benefits, from the vastly important (401k match) to the less crucial (discounts at Brooks Brothers) discuss or shoot us the details.
As the State Controller of California, John Chiang arguably has one of the worst jobs on Earth. Public service is a fine calling and working for the Terminator probably has its moments of awesomeness but he still presides over one of largest fiscal nightmares you could possibly imagine.
For starters, it doesn’t help when you overshoot tax revenues for the month of April by $3 billion. Plus, you’re dealing with a state legislature that is probably incapable of agreeing on what ocean serves as the border of their state.
So take that and a bunch of other stuff that’s not really worth rehashing, you get this, “[W]ithout a new spending plan that closes a $19 billion shortfall, the state would run out of money by late October. ‘We will run out of money if everything remains the same,’ [Chiang] said in an interview.”
Of course the state Assembly’s Republican leader, Martin Garrick, finds this to be a load of crap since what it comes down really is your political party “[He] didn’t represent the fact that it is his party’s own lack of leadership that have led to these delays.”
Look, we’ve all accepted the fact that California is the brokest-ass state of the union and is completely inept when it comes to doing anything about it. Sure New York is a pathetic loser that manages to embarrass itself on a regular basis and most of the rest of the states out there leave a helluva a lot to be desired but Cali really outdoes everyone on a regular basis. This will make two years straight of issuing IOUs at the expense of citizens and yet the diaper-wearing California reps do nothing.
If Whitman gets in there, her first act as Guv could be to auction them off one by one (or just list them all as “Buy It Now” for $1). Of course the take wouldn’t be nearly enough to fix the budget but at this point a symbolic gesture will do.
Jeff Kollin, Camille Asaro, Frank Attalla and Navin Sethi come on down!
Asaro and Kollin rep the New York office, Attalla in Roseland, NJ and Sethi gets the nod in San Fran.
Ms. Asaro and Mr. Attalla are members of the Rothstein Kass Financial Services Group. Mr. Sethi, a tax Principal is a member of both the Financial Services Group and the firm’s Commercial Services Group. Mr. Kollin has been named Principal and Head of the Financial Services Advisory practice within Rothstein Kass Business Advisory Services, LLC, a Rothstein Kass affiliate. Rothstein Kass simultaneously announced the promotion of Rich Sumida to Senior Director at Rothstein Kass.
Son of the Kass (presumably, the firm is 50-ish) takes the mic:
“The collaborative culture at Rothstein Kass has ensured that our professionals are able to continually enhance their skills and expertise throughout their careers. Our ‘one-firm, one-floor,’ philosophy remains a cornerstone for our success. Staff at all organizational levels gain invaluable experience working side-by-side with seasoned industry veterans in support of our clients. The companies we serve, in turn, benefit from the continuity, proficiency and knowledge that result from our ability to hire and retain superior talent across practice areas and office locations,” said Steven A. Kass, Co-CEO and Co-Managing Principal of Rothstein Kass. “Camille, Frank, Navin and Jeff are engaged, insightful and dedicated members of the Rothstein Kass team, and have demonstrated exceptional leadership qualities during their time with our firm. On behalf of our entire organization, we would like to congratulate our new Principals on their achievements and thank them for their contributions to our success.”
Not much to add here other than 1) congrats to the new RK principals and 2) the “one-firm, one-floor philosophy” could have really helped a certain Crowe Horwath partner.