Category: News

FASB to Make Heads or Tails of Repurchase Accounting Soon Enough

Back in April when he was testifying before the House Financial Services Committee, FASB Chairman Bob Herz couldn’t really say one way or another what he thought about the repurchase accounting that Lehman Brothers was using.

At the time, Herz just said that FASB would work diligently with the SEC (no porn allowed), that Lehman skirted the disclosure rules and that they were going to get to the bottom of this, come hell or Barney Frank’s shrewd disposition.


In a recent meeting with his fellow double-entry wizards in Norwalk, Herz said that he was opening up ‘a very targeted scope project’ that will get to the bottom of this pile:

“Once we’re made aware that people are trying to structure around specific provisions in the accounting literature, it makes you think about whether those provisions need to be looked at,” he told the board. “We’ve asked the staff to take a look at that and come back with some recommendations in the pretty near term,” he said.

FASB Plans New Rules Around Repurchase Agreements [Compliance Week]

Fulltime Offer Watch ’10: Big 4 Class of 2011

Now that it’s officially August, that means a few things:

1) Everyone around starts bitching how summer is almost over

2) The tax compliance folks take a field trip to the nearest Radio Shack to stock up on their batteries for the two and a half month stretch and

3) This year’s interns starting getting their offers for fulltime employment.


This of course means that your coffee jockeys and Xerox operators will start stressing over everything that they’ve ever done this summer and whether it’s good enough to be blessed with the honor and privilege to attain fulltime Big 4 employment.

So if you veterans out there have been doing your job, you’ve shaped some fine, young, booze-drenched minds into someone that is going to your new associate next fall. If you feel like giving them some credit below. And interns, if you’ve gotten some good news (official or otherwise) jump for joy below and share your experiences – the good, the bad, the truly mortifying (extra bonus points here).

UPDATE: Straight out of the rumor mill, we’ve heard that some E&Y interns have already found out that they won’t be partying with Mickey & the Gang:

There was a round of interns who were let go on Friday. They were told to come in to the office and terminated, offers not given. Saves the expense of sending them down to Disney (the interns that remain leave this Wednesday). There were at least 3 let go in NY.

Happy Birthday Sarbanes-Oxley!

Eight years ago on this this glorious day, the ‘Public Company Accounting Reform and Investor Protection Act’ (in the Senate) and ‘Corporate and Auditing Accountability and Responsibility Act’ (in the House) came together to bring us Sarbanes-Oxley.

Most of you didn’t realize it at the time but this particular piece of legislation created thousands of new jobs at Big 4 firms, only to find those people out on their asses a few years later. Oh, well. Luckily, there are plenty of options with you holders of the accounting degree.


We perused the SOx Wikipedia page to find out some things worth noting:

• The final version passed the House 423-3 – Jeff Flake (R-AZ) and Ron Paul (R-TX) were two of the three voting ‘nay,’ but Flake and Paul pretty much vote against everything.

• It passed the Senate 99-0 but our friend Jim Peterson has said, “the inability of Sarbox to reach global-scale problems shows the futility of legislation so politically anodyne that it passed the US Senate [unanimously].”

• GWB called SOx, “the most far-reaching reforms of American business practices since the time of Franklin D. Roosevelt.” This, many will argue, has now been trumped.

• The PCAOB! If it wasn’t for Sarbanes-Oxley, there would be no PCAOB. Well, and some recent help from the SCOTUS.

Anyway, we’ve probably said enough. If you have fond wishes or memories of Sarbanes-Oxley that have transpired over the last eight years, cut loose in the comments.

Got Thoughts on Dodd-Frank?

No, Dodd’s hair and Barney’s thriftiness are not at issue here.

Mary Schapiro needs constructive comments from the peanut gallery because this thing is a week old and since some people at the Commission have the attention of Tom Petters, they can’t afford to lose focus.

Just jump over the Public Comments page and let ‘er rip. Any section you want get down with your wonky financial reform knowledge is welcome.

It has not even been a week since the President signed the regulatory reform legislation into law, but at the SEC we are already working to fully implement the dozens of studies and rulemakings required of our agency,” said Chairman Schapiro. “We recognize that the process of establishing regulations works best when all stakeholders are engaged and contribute their combined talents and experiences. We look forward to preliminary public comments in these areas.

Not only that! The SEC needs more people. This 2,000-some odd page behemoth is putting asses in cubes and more of the kicking ass and taking names will be had. Just two ways you can join the good times going on at the SEC.

SEC Chairman Schapiro Announces Open Process for Regulatory Reform Rulemaking [SEC]

Dennis Kozlowski Would Like to Know Why More People Aren’t Outraged About These Epic Tyco Parties

A couple of weeks ago we told you about fired Tyco accountant Jeff Weist who wasn’t really into, among other things, mermaid greeters and costumed wenches. Whether or not he’s not a fan of starfish bikinis wasn’t the issue, it was the principle of the matter.

You see, some Tyco executives got into a bit of trouble back in the day for some accounting fraud but the kicker was the footage of a four-day “Roman orgy” rager in Sardinia. The jury didn’t have much problem throwing the book at former CEO Dennis Kozlowski and former CFO Mark Swartz after concluding that awesome party = crooked execs. Weist figured the company didn’t really need more trouble so he raised a fuss over the expenses for another epic bash that was being planned for execs in the Bahamas.


FOX Business Network’s Neil Cavuto got wind of this and had Weist on his program only to do most of the talking. When Weist was able to squeeze a word in, he didn’t exactly come across as a fun-loving guy but more like your typical accountant that would probably frown on these types of shenanigans. Nevertheless, Weist was given the boot and that has caused a bit of stir – specifically, Weist filing suit against Tyco.

Anyway, a guy that knows a little something about awesome parties – Dennis Kozlowski – caught Cavuto’s little program and felt obligated to write a letter (a copy follows in the following pages) expressing his disappointment.

Koz writes, “As I write this letter in my 6′ x 9′ cell jail cell, all I can muster in response to your show is ‘My, how things have changed.’ “

Right! Like, how on Earth can you justify stingray feedings? COME ON. You want sexy men and women running around in togas, that’s understandable. You just raid your linen closet and you’re good to go. But can you believe someone would throw a corporate bash in the Western Hemisphere? Shameful.

He goes on to hem and haw that if it wasn’t for some idiot deciding to tape his little bash in Sardinia, which was later shown to 12 Manhattan jurors, he wouldn’t even be in this predicament. Further, DK would like to know where the outrage is re: the mermaids, wenches, tattoo artists, bonuses and so forth, “With the Tyco extravaganza where employees were paid ‘bonuses’ to attend, you have to ask where is the outrage?”

Well? Outrage? Anyone? The man is in a prison upstate and he can’t hear you!



Talking Social Media With the New Jersey Society of CPAs

From the very first day we swapped our totally unprofessional Twitter account for one with less F-words and started finding accountants to follow, we have been constantly impressed with the concentration of accounting folks in social media. But in the constantly-evolving world of Internet communication, there are always a few bright spots that stand out as ahead of the curve, and the New Jersey Society of CPAs’ communications strategy sets itself apart as one such bright spot.

We were able to get a few moments with NJSCPA’s Don Meyer to discuss their strategy, successes and the drive behind their major social media push of the last three years. Operating with three goals in mind – driving member retention through a greater level of engagement for current meorking and learning opportunities for current members; supporting existing membership acquisition programs – the NJSCPA has learned to use the power of blogs and social networking to reach potential, new and long-time Society members as well as CPA exam candidates across the country. Turns out that we got way more insight into the NJSCPA social media brain than we can share here and were terribly impressed by their varying campaigns, daring strategy and dedication to delivering information.


AG: First things first: let’s talk about your social media campaigns. What sort of things are you heavily involved in and why?

DM: We launched our first blog, NJSCPA Exam Cram, about three years ago to help guide student members and exam candidates through the exam process. We’ve been on Facebook for almost two years and have attracted more than 1,800 fans. We developed our page to maintain contact with student members who sometimes change mailing addresses and emails following graduation, but we now find that the page is a valuable source of professional and Society information for members in all age groups. Our LinkedIn group, launched almost two years ago, serves much the same purpose, providing information for our members and a place for them to connect. We jumped into Twitter about a year ago. We currently have more than 700 people following us. Our Twitter page is linked to our news blog, CPA Observation Post. We use those tools to provide daily professional and Society updates, but we also use Twitter and the blog to help NJ accounting firms promote themselves.

AG: Is there anything you’ve tried that hasn’t worked out as well as you’d hoped?

DM: We tried a financial literacy blog, but we couldn’t generate much interest. I think there may be too much competition out there and we couldn’t find the right niche. Our financial literacy Facebook and Twitter pages have not taken off as quickly as we had hoped.

AG: Anything that really surprised you when it comes to social media?

DM: I was not a believer in Twitter before we started using it extensively last year. Now I think it’s my favorite social media site. I think it’s a great tool for disseminating news and information quickly and easily. I’m also surprised how successful our Facebook advertising has been. I was skeptical that anyone on Facebook would click on ads promoting our page, but it’s played a key role in helping us promote our presence.

AG: The NJSCPA Exam Cram blog has been around for awhile (we noticed it quite some time ago) and seems to get a great response. Can you tell us more about how this came about and how you select exam candidates to participate? Do you follow them after they’ve successfully completed the exam?

DM: Many of us involved in the Society’s student outreach programs have never taken the exam, so we felt we needed to get the perspective from aspiring CPAs who had experienced the ups and downs. This way if a student or candidate asked us a non-technical exam question (e.g. in what order should I take each section, how should I study, how do you feel when you fail one part of the exam, etc.) we could refer them to the blog. We started out with one blogger but soon discovered that work and personal commitments would preclude any blogger from posting as often as we would like. So we gradually added more bloggers. At the moment, we have five CPA Exam candidate bloggers and one staff person blogger, Janice Amatucci. We don’t have a set procedure for how we pick our bloggers. We ask student members who have been involved with the Society through one of our various student programs or simply ask for volunteers via email or at events. The first five bloggers all passed the CPA Exam and continue to contribute to the NJSCPA by writing articles, serving as team leaders at student events or attending other Society events. To date, we’ve attracted more than 72,000 pageviews.

You can find the NJSCPA all over the place online here.

NASBA Gives Its Accounting License Library a Makeover

For those of you that aren’t already aware, we implore you to check out NASBA’s incredibly useful Accounting Licensing Library – a comprehensive, continually-updated database that can help future CPAs find a state in which to be licensed and offers accounting firms access to important state data to assist in their efforts across state lines. In other words, the tool’s main goal is to facilitate mobility by bringing all 55 jurisdictions together in one easy-to-use area while offering a one-stop shop for those considering CPA licensure.

We recently got a chance to chat with NASBA General Counsel and Director of Business Development Maria Caldwell about the new ALL.


The new ALL tool features a new section for accounting students, an enhanced state requirement comparison research tool and expanded product information. The refreshed ALL website offers the same features and benefits as the previous site in a more user-friendly format. Users can find detailed licensing information and even use their research tool to determine if their educational requirements meet any state’s licensure requirements without having to click through each state board’s website individually. This is huge for candidates and for NASBA, as it allows them to spend more time dealing with candidate issues and less time pointing candidates in the right direction.

The birth of the ALL actually began within NASBA four years ago as they wanted a single resource for internal use that would take each state board’s requirements and aggregate them into one place. “There really wasn’t one source to go to and look up all these different rules, so that was the impetus for putting the tool together,” Caldwell told us. “We wanted to offer it to firms at first but once it was out there we realized there were several different audiences using it. Students use it as a licensing tool and international candidates use it as well.”

With over 700 candidates accessing the tool per year (before the makeover) and a significant leap in CPA exam applications since the first whispers of an economic downturn in 2008, interest in the tool and CPA licensure does not appear to be waning any time soon.

Beyond the licensure aspect of the tool, the ALL gives both individuals and firms a way to improve their own economic outlooks by reaching across state lines to find clients. “In this kind of environment, the firms are looking to neighboring states if their state is suffering from a lack of business,” Caldwell said. The tool allows for mobility without firms wasting countless hours combing through state requirements and allows CPAs in a specialty practice to meet the needs of clients who may be in areas that lack qualified accountants who offer their specialized services.

As the CPA exam prepares to go international, NASBA is counting on increased interest in not only the ALL but the all-important CPA designation. Let’s face it, not every industry can say it has weathered the economic downturn as well as CPAs have and passing the exam is still considered a prestigious accomplishment across the globe.

Great job, NASBA, we definitely approve!

What Would the Nonprofit Sector and Community Solutions Act Accomplish?

Representative Betty McCollum is upset that small businesses have the Small Business Administration but nonprofits don’t get a Nonprofit Administration to evaluate, build and monitor the capacity of America’s vital nonprofits. She believes nonprofits are an invisible but vital part to the economy and overlooked by Washington, DC except when it comes to tax issues.

She writes in the Hill:

This legislation represents a significant step toward creating a more effective partnership between the federal government and the nonprofit sector. H.R. 5533 establishes a new United States Council on the Nonprofit Sector. The Council will be a forum for leaders of nonprofits, foundations, businesses and government to discuss strategies for strengthening the nonprofit sector. The bill also creates an Inter-agency Working Group on the Nonprofit Sector. This group will ensure that high-level representatives from cabinet agencies and other key agencies coordinate and improve federal policies pertaining to nonprofit organizations. Finally, the legislation directs Federal agencies to collect and publish better data on nonprofits AND to support research that will lead to smarter Federal policy.

The goals of the Nonprofit Sector and Community Solutions Act are to build a stronger nonprofit sector, craft smarter federal policy, and create more vibrant communities in every state across the country.

Listen, we love working groups as much as the next cube-dweller but haven’t yet seen a copy of the Bill so can’t say either way at this point. What we do know is that the nonprofit sector is large enough to be in need of some help beyond whatever pestering they get from our friends at the IRS.

According to a 2009 Congressional Research Service report, nonprofits (mostly charities) make up over 5% of U.S. GDP. Charitable organizations are estimated to employ more than 7% of the U.S. workforce, while the broader nonprofit sector is estimated to employ 10% of the U.S. workforce. In 2009, nonprofits filing form 990s with the IRS reported approximately $1.4 billion in revenue and nearly $2.6 billion in assets.

Those numbers do not include the estimated 215,000 charities who have neglected (or completely blown off) their 990 responsibilities.

Update: Ms McCollum’s office was kind enough to get in touch and provide us with more information and a direct link to the Bill. We look forward to seeing how this works out.

More Than a Few People Didn’t Heed the ABA’s Advice re: “Fair Value Sucks” Letters to the FASB

Just last week we mentioned the American Bankers Association and its efforts to undermine the FASB’s latest fair value proposal that, in the ABA’s mind, could bring down civilization as we know it.

Because of this danger, the ABA encouraged “investors” through email and on its website to write individual letters to the FASB, expressing their displeasure with the worst idea in the modern history of double-entry accounting. We say “investors” because the ABA not-so-subtly asked everyone (i.e. who felt the overwhelming urge to write Bob Herz & Co.) to refer to themselves as such.

Further, the ABA provided a template of a letter to send to the Board for the “investors,” however, it did warn to resist using the example as their own because A) this is far too important and telling the FASB that fair value pains you in the deepness of your soul and takes food out of your children’s mouths will be a far more effective narrative; and B) the FASB hates form letters. HATES. So much so that Bob Herz rips up all his gold stars that he gives for the constructive letters he receives and then your unoriginal ass gets negative points.

The group urges investors to “write your own letter — the FASB does not appreciate ‘form’ letters, and often discounts them in their analyses.”

Simple enough, right? Well, maybe. But In his column today, Jonathan Weil gives an example of one ABA soldier that wasn’t very good at following instructions:

Among the letter writers was Terry L. Stevens of Francesville, Indiana, who identified himself as a bank investor, as the ABA had suggested. He didn’t mention that he also is chief financial officer and executive vice president of Alliance Bank, a closely held lender in Francesville with $270 million of assets.

“As a bank investor, of utmost importance to me regarding the banks in which I own stock is their financial position, and transparent financial reporting is key in order for me to make investment decisions,” Stevens’ letter said. “With this in mind, I am writing to express my deep concerns and opposition to the portion of the proposal that requires all financial instruments to be marked to market.”

Stevens didn’t write those words himself. He copied them verbatim from a sample letter the ABA posted on its Web page. So, too, did a bunch of other bankers who submitted comment letters to the FASB opposing its proposal, notwithstanding the ABA’s warning that they shouldn’t do cut-and-paste jobs.

This had to be a mistake, right? This is far too important of an issue to the banks of this country that a mishap like this could just happen. Bankers are responsible people that take this stuff very seriously and would never risk going through the motions just to serve at the whims of their lobby’s voice…would they?

Stevens told me he didn’t have time to write his own letter from scratch. “The points that I grabbed out of their paragraphs did a good job of explaining how I felt about the situation,” he said.

Oh.

Stealth Bankers Bomb as Anti-Reform Crusaders [Jonathan Weil/Bloomberg]

Job of the Day: AllianceBernstein Needs a Senior Auditor

AllianceBernstein is looking for an experienced auditor to join its internal department in New York.

Ideal candidates have a minimum of five years experience with exposure to alternative investment products. Advanced degree or certifications are preferred.


Company: AllianceBernstein

Title: Senior Audit Associate

Location: New York

Description: We are seeking a seeking a Senior Audit Associate with strong business and/or audit experience in Alternative Investments to join our Internal Audit Department. This position is an opportunity for experienced professionals to join a dynamic team to deliver value added audit services.

Responsibilities: Assist Audit Management in carrying out the annual audit plan; Assess the accuracy and adequacy of financial information and the Company’s internal control structure; Assist Audit Management in accomplishing certain administrative tasks; Supervise and work with junior auditors; Through continuous monitoring, keep current as to the development of relevant industry, regulatory and corporate matters that may affect the Internal Audit Department’s audit scope.

Skills: Our ideal candidate will have 5 to 10 years of broad capital markets experience with an emphasis in alternative investment products and services. College degree required. Advanced degree and/or certification preferred. Candidates should have demonstrated leadership capability, strong team work capabilities, solid written and oral communication skills and excellent, analytical skills. Candidates must have the ability to interact with all levels of management; Knowledge of the buy-side investment management business is a plus. Prior audit experience is preferred, but not required. Candidates should demonstrate a firm grasp and good working knowledge of the suite of Alternative Investment products and services including: Hedge Funds – direct investments and Fund of Hedge Funds.

See the entire description over at the GC Career Center and visit the main page for all your job search needs.

Accountant Claims That She Has Trouble Controlling the Volume of Her Voice

This is understandable. We know a few people that have been accused of being “angry” when, in fact, they are just being “loud.”

Negros Occidental Provincial Accountant Merly Fortu denied on Sunday that she acted with arrogance and hostility when she met with the elected provincial government officials on July 1.

Fortu, who faced administrative charges for grave misconduct and gross insubordination for allegedly shouting at elected provincial government officials during the meeting, explained that her normal speaking voice was “a little bit louder” than others.

It is similar (albeit the opposite) to having shy/asshole confusion.