Category: News

McGladrey Gives Thanks with News of Bonuses, Extra Holidays and Babysitters

C.E. Andrews and Dave Scudder interrupted McGladrey employees regularly scheduled spreadsheets a short time ago to share all kinds of good news. For starters, Mickey G’s is letting all employees blow off December 23rd and 30th which is pretty nice. Secondly, concierge services will be available starting January 1st, as well as a new arran”http://www.sittercity.com/”>Sittercity for in-house care caregivers.

And yes, there are bonuses.

But not just the year-end bonuses, mind you. No, C to the E and Scuds heard your incessant bellyaching and in addition to the year-end pool they are implementing “a new program to provide real-time recognition and monetary rewards” for those of you that go above and beyond the call of duty.

[caption id="attachment_21691" align="alignright" width="105" caption="Scuds"][/caption]

Our tipster was pleasantly surprised and told us, “McGladrey matches PWC – well not quite but certainly more than expected.”

True, McG isn’t hosting Thanksgiving up in Minnesota Nice country to our knowledge but it seems like a nice little surprise from the punch and cake crowd.

With Thanksgiving just around the corner, we’d like to take time to reflect on the things we are thankful for this year. The last twelve months haven’t been easy, but we have made some important changes in our organization that will create a solid foundation for our future success. We are thankful to have made it through this time of transformation, and we are beginning to see early signs of new growth for our firms, which will be aided by our new brand, growth strategies and the improving economy.

We have only accomplished this because of your tremendous efforts, and we are grateful to lead such a dedicated group of people. Today we’re happy to share some of the things we plan to do to show our thanks to you and to help you experience our people promise.

A gift of time
We’ve asked a lot from you during the last year, and we are truly thankful for the time you’ve invested to make our firms and our clients successful. To show our gratitude, we are giving you two extra paid holidays on December 23 and 30 to relax and spend time with friends and family. If you have conflicting client obligations, you may consult with your work team leader to find alternate dates.

Support for your busy schedule
You have a lot on your plate at work and at home, and we’re pleased to offer two benefits to help offset some of the stress you might be feeling. Starting January 1, all offices will offer concierge services to help you complete a variety of errands and personal to-do’s. We also will provide access to Sittercity, a new client whose business offers a program that connects you to local in-home caregivers for your child, elder, pet or home. Look for more details and information from your regional leaders in the weeks ahead on how you can take advantage of these programs.

Recognition and rewards
We know that you’ve been wondering about the bonus pools for year end, and we want to confirm that we have planned for bonuses this year to reward eligible employees for exemplary performance in support of our firms and our clients. We’ll commit to a baseline funding level in dollars, and the pool will grow based on our year-end performance.

But you’ve told us that year-end rewards alone aren’t enough – you also want to be rewarded throughout the year for your important contributions. In January, we will be introducing a new program to provide real-time recognition and monetary rewards to those of you who go above and beyond to serve clients, develop colleagues and support our strategic objectives. It will be similar, but not identical, to our former SPOT bonus program that many of you may remember. You will be hearing more specific information about both of these plans from your region after the Thanksgiving holiday.

We are truly thankful to have you on our team, and we hope that these things help demonstrate our appreciation. They are just the beginning of more good things that will come as we continue to strengthen our business. We look forward to reconnecting with you via our quarterly webcast on December 16 to discuss the progress we’ve made so far. Watch for an invitation next week.

In the meantime, we hope you have a relaxing holiday and that you enjoy reconnecting to the people and things that are important to you.

Happy Thanksgiving!

Can We Get a Recommendation for an International Accounting Group Up in Here?

The following post is republished from AccountingWEB, a source of accounting news, information, tips, tools, resources and insight — everything you need to help you prosper and enjoy the accounting profession.

A few years ago we were members of Affilica – an international association of accounting and legal firms, who had a global presence, but not in North America. This was a particular concern because we specialise in helping US companies enter the UK market as their entry into Europe, and are seeking an alliance with a group that has a substantial North American membership.

But we are having trouble finding the right group.


Yes – we are members of BritishAmerican Business Inc, and do get referrals from the UK Trade & Industry, and from the UK /US Advisory Network, and from firms of CPA’s in the US who may not have in-house international expertise (Kevin Beare is an Associate member of the MSCPA), but we are growing and can see the mutual benefits of belonging to an international association.

We recently enquired about membership of CPAAI. To our surprise they said that our niche practice was considered too small.

However they were unable to say what size criteria a firm providing complementary services to their members needed to be.

We currently receive referrals from all 4 of the Big 4 firms, because they recognise that our total outsourced accounting and UK payroll service complements their own higher value services. We also get similar referrals from second tier firms. We do not have Chinese walls whereby one Partner does the accounting and tax and another partner does the audit of that work. For true independence and to enable us to act as trusted advisor to our clients we gave up our audit registration.

That is the background to this request.

Have other firms come across these difficulties?

Suggestions and advice regarding other suitable groups to join would be welcome.

Surprisingly, Glenn Beck Doesn’t Understand How the 1099 Requirement Works

Everyone agrees that the 1099 requirement in the healthcare overhaul sucks. It’s so unpopular that Max Baucus has taken it upon himself to ride in on the Senate chamber on a horse clad in shining armor with an amendment that will repeal the requirement pronto and single-handedly save small businesses everywhere.

But in the meantime, area man-cum-national fruitcake Glenn Beck thought he needed to warn all the eBay junkies out there that if don’t hock their stuff this year, they’ll be subject to the requirement next year:


Of course this is bullshit. Despite what GB might think about the national media, if this were in fact true, every outlet on the planet would have reported it already. The headlines would have screamed “WAR ON EBAY” and Meg Whitman could have campaigned on that (but probably still would’ve lost).

Anyhooo, just for good measure, The Hill’s Healthwatch also points out that Beck’s “exemption” claim is also false:

Beck also told his viewers on Tuesday’s show that “at least 111 companies have been declared exempt from having to use Obamacare.” In fact, the firms he refers to have been granted a one-year waiver from the requirement that their annual limit on coverage be at least $750,000.

“Exempt” versus “a one-year waiver.” Yeah, that’s almost the same thing.

A Walmart Sticker Leads to California Lawsuit Against Overstock.com

~ UPDATE includes link and quote from Overstock.com’s press release responding to the suit.

Gary Weiss is all over the $15 million lawsuit brought by seven California counties against Overstock.com today, noting that this could be a helluva problem for our fave SLC problem-child:

The counties had offered to settle with Overstock for as little as $7.5 million, but Overstock refused. No wonder: if the company had coughed up such a substantial amount of cash, it probably would have been driven into bankruptcy.

The suit came out of some alleged false comparative advertising claims (e.g. think Crazy Eddie commercials) including this one that got investigators on the case:

It was a Cottonwood man’s complaints about the firm that persuaded prosecutors to investigate the matter, said Erin Dervin, a Shasta County deputy district attorney.

In 2007, Mark Ecenbarger bought a patio set for $449 on Overstock. The website claimed the list price other companies were charging for the set was $999.99.

But when the furniture was delivered, there was a Walmart sticker on the side of the box showing the set was really worth $247.

Naturally, Overstock is saying that this one big misunderstanding and that isn’t how they do business. The prosecutors aren’t convinced:

The suit claims Overstock often outright makes up its list prices and compare-at prices based on arbitrary markups over the firm’s cost for the product. In many cases, Overstock entirely fabricated a fictitious comparison price and then claimed it was discounting that price, even when it was the only seller of the product, prosecutors allege.

You would think that such a troublesome lawsuit would cause havoc on the company’s stock price, wouldn’t you? Nope. Gary explains:

The reason for that is simple: fraud is already incorporated into the share price. This company is under SEC investigation for systematically cooking its books. Why should consumers be treated any differently than shareholders?

UPDATE: Full statement from Overstock is available although Patrick Byrne is MIA:

“Overstock.com stands by all our advertising practices, including providing comparison values which we thoroughly explain on our site. We have been singled out for standard industry practices, which we look forward to demonstrating in court,” said Jonathan Johnson, President of Overstock.com.

Apple’s New Audit Committee Chairman Is a Rocket Scientist

No, a for-real rocket scientist.

Apple Inc. named former Northrop Grumman Corp. Chief Executive Officer Ron Sugar as a director, adding an aerospace-technology expert to a board that includes leaders in retail, cosmetics, software and politics.

Sugar, 62, will serve as the board’s audit and finance committee chairman, Cupertino, California-based Apple said today in a statement. Sugar headed Northrop, the third-largest U.S. military contractor, from 2003 until last year, helping the company consolidate $26 billion in acquisitions.

Okay, accounting/auditing isn’t the most mind-bending of trades, so why does Steve Jobs feel the need to appoint someone who has spent most of their careers putting things into space as their audit and finance chairs? We’re sure Mr. Sugar is an extremely smart man – c’mon, A ROCKET SCIENTIST! – and is obviously good with numbers but doesn’t this level of irrelevant expertise seem a tad ridiculous? Just wondering out loud.

Is Accounting Rule Anarchy a Good Idea?

John Carney comments on Sheila Bair’s bellyaching about mark-to-market today by simply wondering why there has to be a debate at all. That is, couldn’t accounting rules just be served up – presumably buffet style – and the banks would choose which treatment they like best and then regulators could judge their health based on their choices:

Here’s what I don’t get: why do we need one set of accounting standards at all? To put it differently, why should banking regulators feel obliged to judge the safety and soundness of financial institutions according to any measure that they do not like? If Bair doesn’t think fair value is appropriate to the banking sector, can’t she just ignore fair value when judging whether banks satisfy regulatory requirements?


It’s an interesting question. Why does the FDIC care what fair value says when determining bank health? Analysts use and refer to non-GAAP data all the time, so what difference does it make if regulators rationalize their analysis on similar non-GAAP measures?

After explaining that, despite the complaints of a certain billionaire (among others), transparency is actually a good thing, Carney floats an idea:

My truly radical proposal is that we should probably do away with this argument altogether by allowing banks—and every other company for that matter—to choose which accounting standards they want to use. If amortized cost is truly a better standard, banks using that will surely be rewarded by higher stock prices and cheaper access to credit. On the other hand, if fair value is appropriate, the market will reward that. Why not let banks choose and bear the costs of their choice?

While we’re with John in spirit (especially for the banks, they run things after all), the BSDs in the accounting will never let this fly. The idea of letting individual companies determine what accounting rules to follow is enough to cause Big 4 partners to set themselves on fire in the middle of Union Square in protest.

However, if you’ve got thoughts on we could put this thing in motion, it might be kind of fun to see how it works out.

The AICPA Teaches Congress What “Burdensome” Really Means

On July 19, the AICPA sent a letter to the House and Senate condemning new 1099 reporting requirements (said requirements being carefully hidden inside The Patient Protection and Affordable Care Act a.k.a. Obamacare) as burdensome and annoying. Apparently the AICPA must feel quite strongly about this matter as it is now November and they have sent a very similar letter to Congress, perhaps to show them just how burdensome extra paperwork can really be.


The House letter may be found here.

The AICPA doesn’t like that rental property owners could now be required to keep extensive records and bother with tax issues in typically tax-free January, among other things:

This would be the first time that individual taxpayers owning rental property who are not “engaged in a trade or business,” would be required to provide Forms 1099-MISC. For example, many individuals, who own a vacation property that is rented part of the year to help defray their costs, would be subject to the provisions of the SBJA. We are concerned that (1) keeping records to track expenses by provider, (2) obtaining tax identification numbers and other information from providers of property and services, and (3) providing Forms 1099-MISC during January, a month when taxpayers would not normally be focused on tax issues, would be extremely burdensome. Additionally, the AICPA questions the need for sending information forms to certain providers of services, such as utility companies.

Thankfully the AICPA has everyone’s back and feels as though business owners should be allowed to focus on growing their businesses instead of worrying over filling out massive amounts of paperwork. We’ve got to appreciate that attitude as any other professional organization might salivate over the idea of plenty of billable hours to go around as CPAs line up to hook up business owners with the right paperwork but not the AICPA, who said “businesses do not need the added cost of more regulatory requirements at a time when their efforts must be focused on profitability and sustainability.” Word!

We look forward to the next round of angry letters from the AICPA on this matter and hope that they don’t find fighting Congress too burdensome.

(UPDATE) Ex-Grant Thornton Partner Gabriel Azedo Arrested in Spain

~ Updated includes statement from Grant Thornton International in final paragraph.

The South China Morning Post is reporting that former Grant Thornton partner, Gabriel Azedo was arrested in Spain, citing “people with knowledge of his detention.”

Gaby was on the lam for over year and has allegedly stolen HK$91 million (around USD$11.7 million) from those close to him, although one of his alleged victims doesn’t see this as a half glass full situation:

Yesterday one of his alleged creditors, racehorse owner Archie da Silva, said: “I don’t know whether to be happy or not. Just because he has been arrested doesn’t mean we will get our money back. It could be a very tedious process to get him back to Hong Kong.”

Arch’s concerns about bureaucratic nightmare that is extradition seem to be well-founded, as the article explains that getting Gaby back to Hong Kong really isn’t going to be easy:

“There is no bilateral agreement between Hong Kong and Spain but a transfer under multilateral treaties the two jurisdictions are signatories to, or under provisions in Spanish domestic law, are two areas that can be looked at,” the person said.

However, it is likely extradition could involve a lengthy legal and diplomatic process because Hong Kong has no Surrender of Fugitive Offenders Agreement with Spain.

Another officer linked to the case said: “It’s really up to Spanish authorities to decide whether to hand over the man to us. They could ignore our request as there is no legal obligation for them to hand over Azedo.”

We contacted Grant Thornton International to see if they wanted to comment but have yet to hear back. It goes without saying that this story is pretty strange/intriguing so, we’ll continue to follow the developments.

UPDATE, circa 10:45 am ET: A Grant Thornton International spokeswoman provided us with the following statement regarding the matter:

“We understand from media reports that Gabriel Azedo has been arrested in Spain and that he may be the subject of extradition proceedings to Hong Kong. He was a member of the global leadership board of Grant Thornton International until his dismissal in October 2009. Immediately following his disappearance, Ms. Angela Gardner, a close relative of Mr. Azedo, filed a lawsuit in Hong Kong against Grant Thornton International Ltd but this was subsequently dismissed by the Hong Kong court.

While the situation is highly regrettable for the individuals concerned, this is now a matter for them and for the Hong Kong courts.”

Here’s What Charlie Rangel Missed at His Ethics Trial

He really should have stuck around. He won on a couple of ’em, which is probably better than most people were expecting.

 


Of course Chuck isn’t going quietly:

How can anyone have confidence in the decision of the Ethics Subcommittee when I was deprived of due process rights, right to counsel and was not even in the room? I can only hope that the full Committee will treat me more fairly, and take into account my entire 40 years of service to the Congress before making any decisions on sanctions.

[…]

The Committee’s findings are even more difficult to understand in view of yesterday’s declaration by the Committee’s chief counsel, Blake Chisam, that there was no evidence of corruption or personal gain in his findings.

From here forward, it is my hope that the full Ethics Committee will take into consideration the opinion of its chief counsel as well as the statement by Rep. Bobby Scott, a member of its investigatory subcommittee who said that any failings in my conduct were the result of “good faith mistakes” and were caused by “sloppy and careless recordkeeping, but were not criminal or corrupt.”

Earlier:
Charlie Rangel Has Heard Enough

Clifton Gunderson Plays Hardball with KPMG, Other Audit Firms By Pitching a Low Ball

Meanwhile, back in the world of where people actually do work – a friend of GC sent us the following:

I heard an amazing price war story from a very reputable source. Thought you would enjoy.

A KPMG audit client in the Virginia Beach area went out to bid. KPMG bid approx $85K, a regional firm bid mid-60K, another firm approximately 40K, and Clifton Gunderson undercut everyone by bidding $19K on the audit. 19K! How in the hell is that possible? This is a prime example of what is happening out there.

Don’t know if this is SOP at Clifton but that price has to make for some horrendous realization or it’s simply staffed by an entry-level associate and a partner. Other theories on how they plan to pull this off without completely losing their shirts are welcome.

To Keep People From Nodding Off, Stephen Schwarzman Reminded Everyone How Much He Hates Mark-to-Market Accounting

The Blackstone Group co-founder, chairman and CEO is in Seoul hobnobbing with various other titans of industry, finance and politics for the G-20 Business Summit and as you might expect, things can get a little drab.

Dark suits, heavy lunches, important people trying to one-up each other’s stories and so on and so forth can really get tiresome so in order to “keep people awake,” SS brought up a topic near and dear to his heart:

[I]n the United States, we eliminated mark-to-market accounting in 1937, and why did we do that? We completely bankrupted our system before, and for some reason, somebody who liked something called transparency decided to have mark-to-market accounting come back, around the turn of the last century. So it in no way surprises me that we had a catastrophic collapse as a result of implementing mark-to-market accounting.

Not exactly sure who “somebody” is but one guy has retired and another is on his way out, so this could be Schwarzman’s reminder to the outgoing MTM cheerleaders that he hasn’t changed his stance that the whole thing just sucks.