Category: News

The Waning Days of Tax Season Are Wearing Thin on at Least One Accountant

Michael Grossbach is taking it out on the help.

Michael Grossbach, 32, surrendered himself to police when he learned of his impending arrest for allegedly assaulting his office assistant on March 5, police said.

“Apparently there was an argument and he lunged at her, grabbing her hand forcefully,” said Sergeant Michael Buck of Irvington Police. “There were injuries, but nothing serious.”

Sergeant Michael Foley arrested the Garrison resident for having illegal physical contact with his 31-year-old employee at his accounting firm at 106 North Broadway. The defendant was charged with assault in the third degree, a misdemeanor. According to police, if convicted he is facing anything from a fine to one year in prison.

Irvington Accountant Charged with Assaulting His Assistant [RP]

Marcum Has Some Doubts About American Apparel’s Ability to Continue Selling Gold Lamé Leggings

Bad news for Dov Charney’s hipster retail paradise as Marcum – who replaced Deloitte last summer – has issued its auditor’s opinion with the language that no one likes to see.


But before we get to that, if you take a quick glance at the balance sheet you’ll see that the company barely has enough money to keep the lights on as their working capital is a measly $3 million (current assets of $216 million, current liabilities of $213 million). This shockingly bad number is mostly due to the $138 million in revolving credit facilities the company has included in its current liabilities. The company is also shows an accumulated deficit of over $73 million in its equity section. APP also bled over $32 million in cash from operations, according to its cash flow statement. All this bad news has lots of people talking about bankruptcy and that doesn’t touch the thirteen (that’s Gawker’s count, I only saw twelve) ongoing lawsuits against the company. Plus there’s the subpoena the company received from the U.S. Attorney General for SDNY last August over their auditor switcheroo.

We could go on and on but you get the pic. Here’s the final paragraph from Marcum’s opinion in APP’s 10-K:

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has incurred a substantial loss from operations and had negative cash flow from operations for the year ended December 31, 2010. As a result of noncompliance with certain loan covenants, debt with carrying value of approximately $138.0 million at December 31, 2010, could be declared immediately due and payable. Notwithstanding the foregoing, the Company has minimal availability for additional borrowings from its existing credit facilities, which could result in the Company not having sufficient liquidity or minimum cash levels to operate its business. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plan in regard to these matters is also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Obviously the bad news is that investors are really spooked but the good news is that there could be a serious fire sale on hoodies and t-shirts in our future. Silver lining!

Congress Continues to Successfully Drag Out the 1099 Repeal

If only somehow they could kill it completely, could we fully revel in the disfunction of the legislative branch:

What is clear is that nothing is certain with moving a 1099 repeal. The House passed a standalone measure on March 3 and the Senate tacked on an amendment to the Federal Aviation Administration (FAA) authorization bill, which passed the upper chamber, each with different offsets to cover the costs of the repeal.

The White House and House and Senate lawmakers across both parties back the elimination of the 1099 provision from the healthcare law but are at odds over how to make up for $22 billion in lost revenue as projected by the Joint Committee on Taxation.

Fate of 1099 repeal still up in the air [The Hill]

Earlier: How Will the Senate Screw Up the 1099 Repeal Bill This Time?
Even Earlier: Vastly Unpopular 1099 Requirement Survives Thanks to the Reliable Dysfunction of the U.S. Senate

Going Concern March Madness: Moss Adams, Rothstein Kass Battle for the Title of the Coolest Accounting Firm

Well, we’ve finally reached the championship match-up and it’s a battle of the coasts. , NJ-based Rothstein Kass will take on Seattle-based Moss Adams for what will no doubt be the crowning achievement for either firm’s busy season. Moss Adams disposed of their rumored dancing partner Grant Thornton while Rothstein dismantled McGladrey. Rehash over; let’s get to the bracket.


Will Rothstein be the ultimate Cinderella? Will Moss spoil the ball? Will Reznick Group mount a firm-wide attack on MA just out of spite? WTFK? But vote so we can wrap this up. If I have to look at another bracket in next 365 days it will be too soon. Poll is open until FRIDAY at 11:59 PT.

Johnson Jacobson Wilcox Ups the Bar on Good Times to Be Had During Tax Season

During tax season, many accounting firms attempt to provide their employees with “fun” things to do. Ordinarily a boss would rather you just qwitcherbitchin and do your job than take you to Dave & Busters or splurge for pizza but when employees are suffering from exhaustion, Excel-induced eyestrain and pants that grow tighter with each passing day, sometimes violence has ensued (or, at very least, passive-aggressiveness so frightening that it borders on assault). While we applaud the effort by firms to make things more pleasant, many of them suck at “fun.”

Las Vegas-based Johnson Jacobson Wilcox, for one, is trying to not suck in the fun department and it appears that they’ve been successful since they were named Best Accounting Firm to Work For in 2010 (15-49 employees) by Accounting Today.


JJW’s managing partner Gary Johnson realizes that most people are still hung up on the old accountant stereotypes and he’d like to debunk those (after rehashing them, of course), “Most people think of accounting firms and accountants as dull, without much of a personality — people with their heads down and green eyeshades on, who work all day long and don’t talk to too many people unless the phone rings. We’re just not like that. We like to have fun once in a while.”

In this particular case, fun includes a $500 clothing allowance for new hires, free lunch during tax season and a Wii bowling tournament.

Johnson Jacobson Wilcox runs a stress-busting Wii bowling tournament every tax season — 2011’s edition kicked off Monday — complete with a trophy. During the 24-employee firm’s busy season from mid-January to April 15, the company brings in free lunch for employees every day. The company also sends new hires an orientation binder complete with business cards two weeks before they start, and a $500 clothing allowance awaits them as soon as they walk through the door.

Obviously the $500 clothing allowance would come in handy for most of you (especially the fashion-handicapped types) but this bowling tournament – and the trophy – is what really got our attention. Of course the Wii hasn’t been around forever and prior to such technological miracles, JJW had actual bowling tournament every tax season. And fortunately for you all, we were able to obtain some footage of two JJW partners from the late 80s in an especially competitive match:

Trade journal chooses Las Vegas accountant best place to work in U.S. [LVRJ]

New Website Allows You to Rat Out That Tax Cheater in Your Life Without Fear of Being Identified

Do you happen to know for an absolute fact that a former co-worker was taking their threadbare clothes to the Salvation Army and claiming them as being in “good condition”? Does your ex-girlfriend/boyfriend exaggerate the expenses they incur from their side business? Does your neighbor’s six-year old underreport their lemonade stand profits? Are you looking for a way to get back at them without the fear of a confrontation? Good news! Taxsqueal.com will let you snitch on them anonymously and you don’t have to deal with any scary IRS forms.


Al Drucker – a former IRS agent – founded Taxsqueal because he thought there was lots of opportunity for Joe or Jane Whistleblower to do their part in closing the tax gap but were maybe hesitant because the idea of being on hold was too much to bear (that and the Big Brother thing):

He said the IRS once manned a toll-free telephone number, but callers to that number now are met with an automated message that directs them to the IRS website. Other potential callers are uneasy about contacting the government and worry they won’t stay anonymous.

Drucker’s idea: Develop a website in which informants can fill out an easy-to-use form written in plain English. TaxSqueal.com then forwards the information to the IRS and erases from its computer system information about the person making the allegation.

The catch is you have to be willing to do it as an act of patriotic duty or hateful spite as opposed to landing a tidy reward for narking out a tax scofflaw:

Whistleblowers would miss their chance to collect. But Drucker figures most people aren’t eligible for a reward anyway, because most of the cases that come into TaxSqueal.com are for less than $2 million.

What’s in it for whistleblowers? Not much. “This site is not designed for people seeking rewards,” Drucker said.

Sweet revenge awaits.

People can report tax cheats on new website [Daily Record via AT]

Man Who Found $9 Million Lotto Ticket While Preparing His Tax Return Thinks Everyone Should Get Some Perspective

Last Irvin Przyborski found a year-old lotto ticket while he was preparing his tax return and wouldn’t you know, it just so happened to be winner worth $9 million. As if winning the lotto wasn’t lucky enough, Irv managed to cash it in just a few days before it expired. Now you might think to yourself, “$9 million! What a lucky guy! He must be feeling extremely lucky and grateful!” but then you wouldn’t know Irv Przyborski.

Przyborski, reached Thursday afternoon and weary from the day’s constant media attention, was unimpressed with the development. “What’s the big deal? It’s not even worth putting in your paper,” Przyborski said outside his East Side home. “It’s like watching paint dry.” Despite his nonchalance, the 61-year-old retired truck driver admitted he would have been upset had he missed the deadline. Nevertheless, he said the prize was hardly life-changing and he had no grand plans for the money. “Look at the people who are out of work,” he said. “People with Ph.D.s can’t find work. There’s nothing joyful about winning money in a situation like this.”

This seems appropriate.

Under the wire and into the money — $9 million winner: ‘What’s the big deal?’ [CT]

Going Concern March Madness: The Coolest Accounting Firm – The Final 4 Sans Big 4

Now that we’ve reached the Final 4 without any Big 4 firms (all bounced in the first round), some of you may have lost interest in Going Concern March Madness: Coolest Accounting Firm. Well, that would make you a loser and anyway, we must press on! Face it, you’ll go for anything to distract you from the fact that you’re stuck inside whispering sweet nothings to Microsoft Excel while spring is slowly emerging outside. And it’s a pretty compelling Final Four anyway. Let’s take a look shall we?


So you’ll notice that we have the very interesting match-up between Moss Adams and Grant Thornton, the two firms that have subject of merger rumors (unfounded!) since January. Obviously the winner here will enjoy the upper hand in any future negotiations between the two firms, so anyone from either firm wishing to upset the leverage here would be wise to take a page from the Reznick Group strategy book.

Speaking of Reznick, we briefly mentioned the fact that their first round magic was nowhere to be found in round two. A tipster filled us in as to why:

I think the higher-ups were embarrassed by the public calling out and subsequent mockery in the comments, not a single other email went out about it – reminders about the competition or the beatdown they suffered at the hands of the commenters 🙂 Serious loss of billable hours that day too, everyone kept checking the site all day long for more comments, emailing and IMing each other about it.

So make a mental note – if your firm’s leadership has a thin skin and isn’t down with wasting a number of billable hours, the Reznick strategy may not be the way to go after all.

Moving on to the second match-up we have the perennial dark horse Rothstein Kass against McGladrey. Rothstein continues their hot streak in GCMMTCAF after their impressive performance in this year’s Vault rankings and McGladrey is…well, we’re pretty surprised to see McGladrey in the semi-finals, to be honest. Perhaps there are sweet incentives being offered internally but right now we haven’t been made aware of any such temptations. Anyway, McG has quietly made a run, so it makes for a decent showdown.

All right, enough with pleasantries. Let’s get to the voting. Polls close tomorrow night at 11:59 PT.

First up – GranMA

Cinderella vs. Mickey G’s.

And Now…CPAs Acting Out a Scene From Casablanca

Following the ingenious reenactment of the beginning of Luke Skywalker’s father issues, the Pennsylvania Institute of CPAs has delved into the classics, bringing us a scene from Casablanca.


Personally, I’m not crazy about this one. It’s bad enough that most of you haven’t seen the film but from an artistic integrity perspective, it really should have filmed it in black and white. However, I have to admit that the overwhelming smoke and horrendous French accent were nice touches. Other commentary is welcome at this time.

More PICPA videos:
And Now…CPAs Acting Out a Scene from the Empire Strikes Back
PICPA: You Need a CPA to Get Your Breathlessly Judgmental Friend to Shut Up
Latest PICPA Video: CPAs Are Like Snuggies
Pennsylvania CPAs Insist Accountants Are Funny in New Videos. Which Are Funny

Going Concern March Madness: The Coolest Accounting Firm – Round 2

Okay people, after a crazy first round, we’re here to present round two of Going Concern March Madness: Coolest Accounting Firm. With all of the Big 4 sent home with their spreadsheets between their legs, the title is up for grabs, although it’s abundantly clear that Reznick Group isn’t taking this shit lightly (they did get their Indian office involved, after all).

With that setup, let’s check out the match-up href=”http://www.goingconcern.com/2011/03/going-concern-march-madness-the-coolest-accounting-firm-round-2/picture-8-11/” rel=”attachment wp-att-27437″>

As you can see, Grant Thornton is now the highest seed left making them the new favorite but judging by how things went in the last round, seeds are basically meaningless.

Voting will start tomorrow morning at 5 am PT tomorrow morning and will end at 11:59 pm PT (don’t ask, that’s just Vizu does) Friday night. Check back here tomorrow to start the voting but in the meantime, place your bets and discuss round 2 below. As always, check with your local bookmaker for actual odds.

UPDATE:
Since I have no plans to get up extra early, I’ve added the polls to the post but you won’t be able to starting voting until tomorrow morning. I realize that many of you will stay up all night and refresh until voting begins but I need my beauty sleep.

The comeback kids vs. the left coast kings (or queens).

Team purple vs. a murder of Crowes.

The most interesting accounting firm in the world (but the coolest?) takes on Arnold Rothstein’s firm…oh, wait…not really, that guy fixed baseball games.

Rounding out with Mickey G’s and BKD.

Lindsay Lohan Probably Costing California Taxpayers Millions Albeit Less Than Real Fiscal Problems

You may have heard that California is having some budget issues. Sure there’s this Wisconsin business and all that but seriously folks, Californ-I-A is really in the fiscal shithouse. There are a number of reasons for this, most of which we won’t get into here but it should be noted that ill-behaved celebrities haven’t been receiving their fair share of blame in the press.

Luckily we have the real America’s news network going to great lengths to inform us about Lindsay Lohan’s role in fiscal catastrophe:

Factoring in all the court dates, court postponements (like when she was partying in Cannes and couldn’t get back to the U.S for a hearing), arraignments, judge and prosecutor fees, jail visits (she has had three stints in the slammer – 84 minutes, two weeks and one evening before posting bail, mug shots (four and counting), probation officers, random drug testing resources, SCRAM bracelets (these generally cost over $100 to install and have a daily fee of about $18) and LAPD security to and from court, how much is Lohan costing the taxpayer?

“It has been four years, and we’re talking about quite a few county law enforcement professionals, so it is probably safe to say several million dollars,” California-based civil law trial attorney David Wohl told FOX411’s Pop Tarts.

And given that Lohan has thus far refused to enter into a plea deal regarding the theft incident, her current theft case could potentially go to trial, costing Californians much more.

MILLIONS! It’s been a while since your humble editor had to make any materiality calculations but taking a quick look around, California’s budget deficit is currently in the nabe of $25 billion. So apparently if LiLo was shipped off to the Dakotas, Wyoming, or some other state that was in a less dire financial situation, things in Cali would be plumb-dandy? Strange thing however, there doesn’t appear to be an “elimination of celebrities that are a burden on society” on the L.A. Times’s budget balancer.

Perhaps Fox is onto something here? Jerry Brown would probably appreciate the other help. Pro bono of course.

Experts: Court-Prone Lindsay Lohan Costing Taxpayers Millions [Fox News via Jezebel]

BREAKING: Accountants Work Long Hours, Get Stressed During Tax Season

Not only that but another shocking revelation is that they use caffeine to help them pull through this tough stretch.

They work 60-hour weeks this time of year, relying on pots of strong coffee and late-night dinners to help them calculate an endless swirl of numbers. Accountants are working feverishly to meet the deadline to file their clients’ tax returns this year even though they have extra time to do so.

Also, this just in – things get stressful because taxes are complicated:

The late nights can get intense, according to Carolyn Dolci, a tax partner in the Hackensack office of EisnerAmper. “It is busier than last year, partly because of the complexity of the tax code,” she said.

If you’re experiencing this phenomenon in your office, tell us your story in the comments below. Things will remain fluid for a few more weeks; we’ll keep you updated with any developments.

Accountants burning the candles at both ends [Star-Ledger]