Category: News

Do I Have To Wait To Get My Degree to Apply for the CPA Exam?

For today’s edition of “help me figure out my life even though the answers are pretty much freely available on Google and/or here on Going Concern”, we get a reader question about the CPA exam application process or, more specifically, how to get a jump on the process. Let’s go:

I am a college student I will have 150 credits in May 2010. Do I have to wait until I get my actual diploma before I can start the process of applying to sit for the test? I guess I’ve heard that it take up to 2 months to receive an NTS so I am worried that I will have to wait until August to actually take the CPA exam. Are there loopholes?


Well, dear reader, firstly if you are going to write in asking us a question like this, it really helps to know what state you will be applying in. All jurisdictions have their own rules and their own crap to sift through, so application timelines can vary wildly depending on where you are applying. I know for a fact you can bypass California’s 8 – 10 week application time by applying when you are not eligible to sit for the exam (like your last semester of college) and then just reapply when you ARE eligible as it will only take about a week to get a reapplication processed. If you call the exam unit in California, they might even give you this suggestion themselves. As for other states? Without knowing where you are it’s hard to tell you what to expect.

The general rule is that you must meet your state’s requirements before application. Some states allow you to apply when you are not eligible as long as you will meet their requirements within a set period of time (like 180 days). Call your state board to see if this is an option.

If you’re lucky enough to be in a 120 state, you can apply for the exam with 120 units and just have to reach 150 by the time you have passed all four parts of the exam.

Most states require your degree to have posted to your transcripts before you can apply for the exam. Again, there are always exceptions so your best bet is to talk to your state board directly and ask. Asking “are there any shortcuts to licensure?” won’t get you very far so try instead to ask if there is a way to apply for the exam before you are eligible to sit or if they have any suggestions for speeding up the process.

The best way to accomplish that is to make sure you have all your paperwork in order and, if available at your school, have your degree fast-tracked to appear on your transcripts as soon as possible. Your school may charge you a nominal fee for this service, but ask them if that’s a possibility if you’re trying to get this over with sooner rather than later.

KPMG Partner Doesn’t Understand Why People ‘Are Dropping Like Flies’

From the mailbag:

Hey Caleb,

Was with a [Midwest city] KPMG Advisory partner this weekend. She said that employees are dropping like flies because KPMG finally unveiled raises after 2 yrs without. Only EP’s were awarded (less than 5%). She said the numbers were in the double digits. What the hell did they expect?


If this sounds a little confusing, it was. We asked our tipster to clarify:

[A]re you saying that she’s under the impression that people are just now leaving because they are upset that they didn’t get raises for two years? And she’s surprised because the raises in the double digits when they were actually in the single digits?

And their response:

[S]he is surprised that so many are leaving especially given the unemployment rate in [midwest city] regardless of how long it’s been since raises were given. It’s not a secret that the other big four have not only given raises but as you report, awarded mid-yr bonus/raises as well.

We went back to some of this year’s KPMG comp threads and the 5% sounds a little suspect, as those rated as “exceptional” were pulling much better increases than that but then again, maybe there were some exceptions that weren’t reported. Also, it seems a little strange that a partner would be so clueless about raises but anything is possible, s’pose.

And as far as the gnashing of teeth because mid-year raises and bonuses are being handed out at other firms, keep in mind that KPMG isn’t even out of their first quarter yet. The rest of those firms have fiscal years that end prior to KPMG’s and they know how the first half of the year is shaping up. Expecting KPMG to start throwing money at people with less than three months in the books is a little ridiculous. At this point, the rumors around the idea of a mid-year surprise should keep you hopeful (but don’t go expecting anything).

It’s been no secret that people have exiting the House of Klynveld (and other firms) – regardless of the unemployment situation – prior to the end of the year (as is typical this time of year). Frankly, people we talk to are pretty optimistic about the job situation for most Big 4 types looking for something new, so this partner may be even more clueless than we thought.

Whatever the case, only 17 shopping days until those left will likely settle for sitting tight through another busy season. If we’re way off base here (or right on the money), feel free to jump in.

(UPDATE 2) Bernie Sanders Didn’t Convince Too Many People (Pretty Much No One!)

~ Update includes clarification on vote tally and addition to first paragraph. ~ Update 2 includes finally vote tally.

Despite Friday’s epic speech by Bernie Sanders, the Senate passed elected to finish debate on the tax cut/unemployment compromise this afternoon to set up the final vote before it moves on to the House.


At 4:12 ET, the vote was 62-7 with Sanders, Patrick Leahy (D-VT), Russ Feingold (D-WI), Tom Udall (D-NM) (CSPAN originally showed Tom as voting “no” and has now disappeared), Jeff Bingaman (D-NM), Kirsten Gillabrand (D-NY) and Sherrod Brown (D-OH) voting “no.”

If you’ve got nothing better to do, you can watch the live feed here.

UPDATE, circa 5:00: Vote is 73-10 with John Ensign (R-NV), Mark Udall (D-CO), Kay Hagan, (D-NC), Carl Levin (D-MI) voting “no.”

UPDATE 2, circa 6:30: Finally vote of 83-15.

University Officials Not Impressed with Accounting Professor’s Demonstration of “First in, First Out”

Since many of you are current or former accounting students, you undoubtedly, at one time or another during your depraved days running around the quad, had the thought creep into your mind, “What would happen if Professor Johnson decided to drop trou in the middle of class while discussing accounting for bonds?”

Unfortunately for students at Kennesaw State University, they now know the answer to that question:

Raymond Devaughn Taylor, 57, is accused of taking off his clothes during a class he was teaching, according to an arrest warrant obtained by the AJC. […] Taylor, who worked in the business department on a contract basis, taught an accounting class during the fall semester on Tuesdays and Thursdays, according to the class schedule posted on the university’s website.

“He will not be teaching again at KSU,” interim Provost Ken Harmon told the AJC.

Now, why this particular professor thought that pulling a Brett Favre on the entire class was a good idea is not entirely clear, as this particular method of impressing a target of your lust many years your junior has an abysmal track record. But as we alluded in the headline, maybe this was a unique teaching method on display. Or then again, perhaps students were showing their lack of interest and rather than scream and yell, Taylor figured this would hold the student’s attention better. OR simply, in the words of Cosmo, “Maybe uh, it needed some air. You know sometimes they need air, they can’t breathe in there. It’s inhuman.”

The theories are endless, really. Yours are welcome below and for the love of everything good and uproariously hilarious, if you were in this class, email us immediately.

[h/t TaxProf and The Summa – neither of whom would ever do such a thing]

New Orleans Hornets’ Audited Financial Statements Leaked

While the House of Klynveld is enjoying their town hall circa now, we’ll share you the latest scoop from Deadspin, who has published the audited (courtesy of KPMG) financial statements of the NBA’s New Orleans Hornets.

We’ve skimmed the financials, noting some interesting items here:

• In 2009, the franchise paid $115,000 for their audit, an additional $10,000 for “accounting issues” and $35,000 for tax compliance services.

• The team has a partners’ deficit of over $80 million thanks, in part to $111.5 million in long-term debt at June 30, 2009.

• The team did have operating income of over $5.8 million for the fiscal year ended June 30, 2009, however, paying nearly $9 million in interest (among other things) swung them to a much narrower net income of $1.8 million.

• Net cash from operating activities were a negative $7.4 million for the FYE June 30, 2008 but improved to a negative $1.5 million for FYE June 30, 2009. The team’s cash balance at June 30, 2009 was a mere $650k.

• George Shinn, the team’s owner, owes the franchise approximately $5 million from “various advances” but has also loaned the team over $8.3 million.

• The franchise has various investment associated with the NBA that have negative equity including: NBA Joint Venture; WNBA Holdings, LLC; NBDL Holdings, LLC

• The team has principal payments of approximately $115 million coming due through 2014.

• Guaranteed contracts to players through the 2013-2014 season amount to $247.5 million.

• “Revenue assistance” from the NBA (team is eligible if it has both an actual loss and a pro forma loss) for the FYE June 30, 2009 was $3.4 million.

Whew! So as you can see, the franchise isn’t in the best of shape. Our analysis is just a scratch on the surface so if you’ve got some time, crunch some numbers and share your findings with the group below.

Earlier:
Who Leaked the MLB Financial Statements?

Just So You’re Aware: There Is a Zombie Accountant Video Game

And it has been described as “epic.”


Giving promotions to the white shirt and red tie wearing undead who can’t help but devour their co-workers for their own good? Sounds like a pretty realistic game.

Get to wasting some billable hours on the demo or full version by going to the Zombie Accountant page on Xbox’s website. And if you’re one of the few people that has a Windows phone, you can play it on the go.

You’re welcome.

Some People Are Ready to Vote for a Caribou Killer in 2012, If Necessary

According to of reports, there is a tentative deal on tax cuts, with all of the current rates being extended for two years in exchange for an extension of unemployment benefits.

That has a few people upset with President Obama (notably, the “liberals,” whoever that is):

Daniel Roche, a 2008 Deputy Field Organizer in Nevada for Mr. Obama, is quoted in an email from the Progressive Change Campaign Committee saying that if the president “capitulates on this, there really is no point in voting for him in 2012.”

“The difference between voting for a Republican and voting for someone whose default negotiation strategy is rolling over and dying whenever the Republican Party says mean things is marginal,” he said. “This should be a ridiculously easy fight to win.”

One More Voice For Ending U.S. GAAP

It’s been said before so the argument that GAAP is bulky and pointless is really nothing new but in a WSJ op-ed this morning, guest writer Mike Michalowicz insists that GAAP is wrong… for profits, that is.

The GAAP actually directs us to spend first, then pay ourselves, and call the leftovers profit. How are you going to grow a successful business and accumulate wealth using that method? Generate more revenue, you say? Well, sure. Except that you’re going to spend it. So you’re right back where you started—working with the leftovers, if you have any.

I propose a new type of accounting: Profit First Accounting (PFA). The difference between GAAP and PFA is simple: Deduct profit first, from the top down. On a PFA income statement, the first line item is revenue, followed by a profit deduction, then your salary, followed by cost of goods and all other expenses.

Hey, guess what? We already have an alternative accounting system lurking in the wings. Allegedly IFRS will help companies that spend quite a bit on R&D buff up equity as R&D costs are considered assets, isn’t that an improvement over GAAP? IFRS also allows for financial statements to come together in whatever order, however those preparing the statements feel is most relevant to the entity’s economic picture. So what’s to stop them from slapping them together as the author suggests above?

GAAP is not meant to transform internal accounting departments into psychics and I doubt any U.S. companies use it because they feel it helps construct a useful picture of the entity that can be used for goal-setting and forecasting. That’s just not what it’s there to do and I think we can all agree on that.

Oh and by the way, Mike is the author of The Toilet Paper Entrepreneur, which he will be able to follow up with a sequel if we actually take his suggestion and try this Profit First idea. Yes business is all about profit but I think Mike is forgetting that companies file for the good of investors and regulatory bodies breathing down their necks, not necessarily for their own good or for the good of their almighty profits.

One Man’s Holiday Wish List Includes Tim Geithner and Charlie Rangel Sharing a Prison Cell with Wesley Snipes

Actually, if Wes Benedict, Executive Director of the Libertarian Party, had his way, Wes wouldn’t be doing time at all.

“The three-year federal prison sentence for Snipes’s failure to file tax returns is absurd. Snipes is not a threat to anyone, and the judge who sentenced him clearly just wanted to scare others who might think about resisting federal taxes.

“Maybe it’s worth reminding people that Wesley Snipes was acquitted of tax fraud and conspiracy charges in 2008. He was only found guilty on misdemeanor charges of ‘willful failure to file an income tax return.’


Right, so the ‘willful failure’ part is where we kind of have a problem. If you willfully fail to control your urge to get cop-slugging drunk and then actually slug a cop, you have committed a crime. Mr Benedict doesn’t buy it though:

“Why is a failure to file a tax return a criminal non-act? Should people ever be sent to prison for not doing something? If the IRS wants to come after Snipes and take his money, they have power to do that. Who does it help to send the man to prison?

“The tax code is incredibly vague and open to interpretation [Ed note: UNDERSTATEMENT OF THE CENTURY]. In fact, the ‘law’ is largely written by IRS bureaucrats. If they decide the law says one thing, you’re OK; if they decide it’s something else, then you’re headed for prison.

“The federal tax code also allows for ‘selective enforcement,’ to put it mildly. Why is it that Wesley Snipes gets a prison sentence, but known tax cheat Tim Geithner gets promoted to Secretary of the Treasury? Maybe Tim should be Wesley’s cellmate. Throw tax cheat politician Charlie Rangel in the slammer too for good measure.

Tim Geithner’s poor choice in self-prep tax software and an actor giving the 16th Amendment the middle finger for 10+ years aren’t quite the same thing. Maybe it’s just us.

[h/t Tracy Coenen]