CAQ to Senators Dodd and Shelby: Don’t Screw with Sarbanes-Oxley
“We are writing to urge you in the course of your efforts to reform the financial sector to resist efforts to weaken protections for investors in the Sarbanes-Oxley Act of 2002 (SOX). Specifically, we oppose exempting smaller public companies from compliance with Section 404(b) of the Act. Further, we are troubled by evidence of a proposal to roll back to an arbitrary market capitalization point strengthened internal controls requirements for larger companies that are already in compliance with the provision.”
~ The Center of Audit Quality, in a letter to Senate Banking Chairman Chris Dodd (D-CT) and Ranking Member Richard Shelby (R-AL).
Harry Markopolos Knows What to Do About Off-Balance Sheet Accounting
“[E]liminate all use of off-balance sheet accounting–for any use whatsoever. Everything must be on balance sheet.”
~ Harry Markopolos, on one aspect of financial reform.
Lehman Whistleblower on Ernst & Young’s Reaction to His Letter
“They certainly didn’t support it. On the Repo 105 issue, they knew about it; they did not appear to know that the number was so large.”
~ Matthew Lee, the Lehman Brothers whistleblower, in testimony today.
Pandering to the Teetotalers with Sin Taxes | 04.19.10
“The honest way to raise more revenue would be to raise income tax rates. But it is more politically attractive to tax these kinds of things. No one can get mad at you for taxing people who drink too much.”
~ Peter L. Faber, tax attorney, on sin taxes.
The Tax Code Became a Religious Experience
“I started to read the Internal Tax Code like I used to study the Bible.”
~ Bob Gorman, religious teacher turned tax professional.
Quote of the Day: Dear Abby Should Not Be Giving Advice About Taxes | 04.14.10
Dear Ms. Van Buren:
Your response to “Phobic” about her boyfriend’s tax returns contained a significant error. You characterized enrolled agents as “the only tax specialists licensed to practice before the IRS,” which is not true. The fact is, certified public accountants and attorneys are federally authorized to represent clients before the IRS.
The CPA has long been synonymous with reliable, objective tax preparation and ranks as the preferred tax professional among millions of U.S. taxpayers.
On behalf of the many CPAs who prepare tax returns every year, we would be appreciative if you would print a correction in your column.
~ Tom Ochsenschlager, Vice President – Taxation American Institute of Certified Public Accountants, in response to this.
Quote of the Day: Ted Danson Is Not Better Than You at Taxes | 04.13.10
“I haven’t prepared my taxes since I was — good Lord, in my twenties. I’m really inept. I’m not good at that.”
Quote of the Day: From ‘Rockstar’ CFO to Mowing Lawns | 04.12.10
“Before the fraud broke, people would ask me what I did before I retired and I’d say I was founder and former CFO of HealthSouth. But today when people ask me what I did before I retired I kind of look away and say I was an accountant and hope they don’t ask me any other questions.”
~ Aaron Beam, former CFO of HealthSouth and current lawn-care business owner, at the University of Texas-Dallas Fraud Summit, earlier this month.
Quote of the Day: Tom Petters Will Start Paying You Back in 2060 | 04.08.10
“Every day, I am fraught with pain and anguish for those affected by my actions. For those who lost money, I will work to repair and replace what has been lost.”
~ Convicted Ponzi Schemer Tom Petters, at his sentencing where Judge Richard Kyle sentenced him to 50 years in prison.
Quote of the Day: Rich People Unite for Higher Taxes | 04.07.10
“We’re calling on other wealthy taxpayers to join us to send the message to Congress and President Obama that it’s time to roll back the tax cuts on upper-income taxpayers.”
~ Mike Lapham, paper-mill heir, would like to pay more taxes.
Quote of the Day: That Profit Really Put Patrick Byrne in a Good Mood | 04.01.10
“Dear Sam, I apologize. Sincerely, Patrick”
~ Patrick Byrne, finally responding to Sam Antar.
In bizarro world.
Quote of the Day: Never a Dull Moment in Accounting | 03.31.10
“Accounting can be exciting — exciting like finding out you are going broke, or exciting like driving a big profit.”
~ Jay Goltz, entrepreneur and contributor to You’re the Boss.
Quote of the Day: A Banker’s Feelings Are Nothing to Me | 03.29.10
“The ability to not worry about whether bankers’ feelings are hurt.”
~ Vanessa Wittman, CFO of Marsh & McLennan Cos., on what skills got her through a tight credit market.
Quote of the Day: Sam Antar Is Ready to Rumble | 03.26.10
I challenge John Thomas Financial CEO Thomas Belesis to a match on the Jerry Springer show. To even the odds, he can bring Overstock.com CEO Patrick Byrne. Two crooks versus a convicted felon born in Brooklyn. They can bring actor turned stock pumper Shia LaBeouf for added muscle, too.
~ Sam Antar, reacting to Thomas Belesis calling him an idiot after Antar suggested that Shia might be able to shed some light on the goings-on at John Thomas Financial involving InterOil. And if you forgot, Sam and Patrick have a bit of a history.
Quote of the Day: If Felix Salmon Was on an Audit Committee | 03.25.10
“If I was on the audit committee which received this letter, I would certainly be shopping my account right now.”
~ Felix Salmon, on Ernst & Young’s “hilariously disingenuous” letter to various audit committee members.
Quote of the Day: Bank of America’s Statement Sounds Familiar | 03.24.10
“Efforts to manage the size of our balance sheet are routine and appropriate, and we believe our actions are consistent with all applicable accounting and legal requirements.”
~ Bank of America statement on the allegations that they engaged in balance sheet manipulation. A statement not so different from Ernst & Young’s on their final audit of Lehman Brothers.
Quote of the Day: Ms. Schapiro, Your Response? | 03.23.10
“The S.E.C. seems more interested in needlessly investigating market participants rather than uncovering corporate malfeasance and protecting investors.”
~ Greenlight Capital Press Release addressing the Commission’s failed investigation of Allied Capital.
Quote of the Day: Kansas Jayhawks Fans Can Quit Crying at Any Time | 03.22.10
“It is most accurate to say that prior to the game, most people thought that KU would win the game. Many, though, thought [that] UNI’s chance of winning was at least reasonably possible. If KU supporters didn’t think enough of UNI to … acknowledge its chance[s], it just shows they weren’t thinking.”
~ Professor David Albrecht, on why Northern Iowa’s “upset,” at least from an accounting perspective, wasn’t really an upset.
Quote of the Day: Did the Ernst & Young Webcast Mention This? | 03.19.10
“I believe the manner in which the Firm is reporting these assets is potentially misleading to the public and various governmental agencies.”
~ Matthew Lee, former Lehman Brothers Senior VP in charge of consolidated and unconsolidated balance sheets, in a letter to certain LEH executives. He was fired.
Quote of the Day: Mary Schapiro Is Being Coy | 03.18.10
“It is safe to assume that we are looking at the conduct of a number of firms.”
~ Mary Schapiro, to a House appropriations subcommittee, not specifically naming Lehman Brothers or Ernst & Young.
Quote of the Day: Accountant Argues for Naked News | 03.17.10
“She would be prepared to read the news without clothes and only wears the clothes because her employer requires it.”
~ An accountant representing Sian Williams, co-host of BBC Breakfast one, trying to convince a tax tribunal that her clothes should be tax deductible because she has “to look good on screen.” He failed.
Quote of the Day: Five Words on Big 4 Audits | 03.15.10
“Our whole industry is useless.”
~ Unnamed Big 4 Auditor and GC reader
Quote of the Day: Ernst & Young Partners Losing Sleep? | 03.12.10
“A successful lawsuit against E&Y could result in a court finding that the failure to properly advise the audit committee prevented Lehman from taking genuine steps to substantially reduce its leverage, which may have saved the firm from bankruptcy. Which is to say, E&Y could find itself blamed for all the losses to Lehman shareholders. That would be a stretch – such a claim would be speculative – but it still should be scaring the heck out of the partners.”
Quote of the Day: No Ponzi Scheme Bailouts | 03.11.10
“[I]t is hard to justify giving special compensation to the investors of Mr. Madoff and Mr. Stanford just because they lost significant amounts of money with little prospect of any recovery.”
~ Peter J. Henning, on Madoff and Stanford victims lobbying members of Congress for a law that would compensate them for some of their losses.
Quote of the Day: We Will Tax Those Love Handles Right Off | 03.10.10
“While such policies will not solve the obesity epidemic in its entirety and may face considerable opposition from food manufacturers and sellers, they could prove an important strategy to address overconsumption, help reduce energy intake and potentially aid in weight loss and reduced rates of diabetes among U.S. adults.”
~ Researchers from the University of North Carolina, who concluded that an 18% tax on pizza and soda could help adults lose an average of 5 pounds a year.
Quote of the Day: Help Doug Shulman Help You | 03.09.10
“A lot of people think of the IRS and have a little bit of fear of the IRS and we want to make sure they know that our doors are open, our people are empowered to make decisions and our goal is to resolve your problem.”
~ Doug Shulman, IRS Commish, who doesn’t prepare his own taxes but wants to help you with yours.
Quote of the Day: March Madness Pools Are an Important Busy Season Distraction | 03.08.10
“This year of all years, the importance of camaraderie and bringing employees together is greater than ever. If people are talking about March Madness, they’re not talking about the state of the business, or the pay cuts, or the layoffs, or things like that”
~ Jonathan Shapiro, partner at labor and employment firm Fisher & Phillips, on why betting pools and even game-watching are good morale boosters.
Quote of the Day: PwC Just Better Make Sure The Dude Wins Best Actor | 03.05.10
“We just don’t tell anyone. Not even our wives.”
~ Brad Oltmanns, PricewaterhouseCoopers partner, on keeping the Oscar results secret.
Quote of the Day: Is Michael Koss a Sad or Happy Clown? | 03.04.10
“Michael Koss is a clown. He does not belong on the board of directors of any company. He needs to be minding his own company, and until he can clean things up there, he should not be allowed to go outside and play.”
~ Tracy Coenen, on Mr Koss’ resignation as the Audit Committee Chairman of Strattec Security Corp.
Quote of the Day: How’s This for CFO Optimism? | 03.03.10
“I’m encouraged by the fact that things are at least not getting worse.”
~ Gayle Anderson, CFO of Match.com, on the economy.
Quote of the Day: Big 4 Lowball | 03.02.10
“What they’re doing is buying some work to keep the staff busy.”
~ Gary Boomer, on the Big 4 low bidding smaller clients.
Quote of the Day: Did Someone Suggest That Google Wasn’t Big? | 03.01.10
“We shouldn’t pretend we’re not a big company.”
~ Patrick Pichette, Google CFO.
Quote of the Day: Mary Schapiro Will Not Be Rushed | 02.24.10
“This is a logical process. But it is slow.”
~ Thomas Jones, Director of the Center for the Study of International Accounting Standards at Pace University and former vice chairman of the IASB, on the SEC’s announcement that it’s sorta on board with the move to IFRS.
Quote of the Day: Doug Shulman Speaks in Austin | 02.23.10
“They do hard work on behalf of the American citizens, and an act like this won’t stop us from doing our jobs with dignity and respect for Americans.”
~ Doug Shulman, the Commish, on IRS employees.
Quote of the Day: Witness of the Austin Plane Crash | 02.18.10
“I thought half the first floor would be dead.”
Quote of the Day: Giving Up Spreadsheets for 10-mile Runs | 02.17.10
“Some days, I’d think, this 10-mile run isn’t so bad. At least I’m not stuck in a conference room staring at a spreadsheet!”
~ Rebeccah Wassner, CPA and USA Triathlon’s Athlete of the Year in 2009.
Quote of the Day: Let’s Hope He Doesn’t Mean Bombings at J.P. Morgan | 02.16.01
“We’re not Greece but we could end up with their same problems down the road if we don’t get spending under control and start dealing with our structural deficit soon.”
~ David Walker, CEO of the Peter G. Peterson Foundation and former U.S. Comptroller General on the US of A.
Quote of the Day: So We Should Expect That SEC Filing Any Day Now? | 02.08.10
“In my opinion, KPMG will resign the engagement if there is reason to doubt management integrity, and will not be rushed into issuing an audit opinion by NASDAQ-listing deadlines needed to avoid Overstock.com becoming a Pink Sheet or Bulletin Board stock.”
~ Howard B. Sirota, former lead counsel in Crazy Eddie class action suits
Quote of the Day: Does 1,800 Visits in 17 Days Constitute a Porn Addiction? | 02.04.10
“If you go to HR and tell them you have a drinking problem, they’ll give you hotlines and help. If you say you have a porn problem, they’ll get security to throw you out.”
~ Michael Leahy, the author of “Porn @Work” and “Porn Nation” on porn addiction, which may be rampant at the SEC.
Quote of the Day: He’s Also Good at Stalking | 02.03.10
“I suspect he takes much more pleasure in baiting opponents than he does in running a company. The evidence he is good at baiting is much clearer than the evidence he is good at managing.”
~ Floyd Norris, New York Times Columnist on the Farmville obsessed, Segway Cowboy Patrick Byrne.
Quote of the Day: What About the Paper Clip Exchange? | 01.29.10
“High speed and commuter rail are a key part of growing our economy here in Florida, and today’s announcement couldn’t come at a more important time for our state”
~ Alex Sink, Chief Financial Officer for the State of Florida and cost-saving guru on her state receiving $1.25 billion in federal funding for a high speed rail system.
Quote of the Day | 01.28.10
“Bernanke fiddled while our markets burned”
~ Richard Shelby, Republican Senator from Alabama during the Senate debate on Ben’s second term as Fed Chairman.
Quote of the Day | 01.27.10
“You give lame excuses then, and you’re giving lame excuses now.”
~ Representative John L. Mica, Republican of Florida to Tim Geithner on his role in the bailout of AIG.
Quote of the Day | 01.26.10
“The problem with dumping him at this stage is that it won’t really get to the heart of the matter, which is that he’s just one of a cast of characters who need to be ousted. The problem is the ensemble. I think it’s a bit like you’re not liking the cast of Seinfeld, and just getting rid of Elaine.”
~ Gary Weiss on Ben Bernanke, et al.
Quote of the Day | 01.25.10
“An auditor’s report tells less about a public company’s health than a doctor’s report tells about an individual – in scope, detail and precision. And if investors and other financial information users are not happy, they are doing nothing to make their dissatisfactions effectively known.”
~ Jim Peterson, from his post “Medical Check-Ups and Annual Audits: What if Your Doctor Reported Like Your Accountant?” at Re:Balance.
Quotes of the Day | 01.22.10
“They’re never afraid to print rumor and innuendo. They’re keeping accountants and auditors honest, never afraid to write about the idiocy frequently displayed by finance professionals and executives.”
~ Tracy Coenen, of BloggingSuits and Fraud Files Blog on a certain website
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“It is self-debasing greed. It is avarice of the corrupted soul.”
~ Professor David Albrecht, Concordia College on those who will profit from a switch to IFRS from U.S. GAAP.
Quote of the Day | 01.21.10
“But Byrne is evil. I’ll stand by that. More than evil, he’s soul-less evil. That said, I hope you understand that I don’t have anything against Byrne per se. I have things I want, and he stands in the way, so I now I’m removing him. At the same time, there’s no reason we can’t co-exist under specific circumstances.
~ William K. Wolfrum, on Farmville junkie and Overstock.com CEO Patrick Byrne.
Quote of the Day | 01.20.10
“The White House should take note from the Massachusetts Senate election that making life harder for small and medium-size businesses is not the right answer.”
~ Dean Zerbe, National Managing Director of alliantgroup on the Obama Administration’s urging of Congress to crack down on corporate tax cheats.
Quote of the Day | 01.19.10
“Audits are of limited usefulness – the scope of work is so small and is done in such a compressed time, usually at the end of the year. And the work that auditors do is predictable.”
~ Tracy Coenen, of Fraud Files Blog, in regards to the how Sue Sachdeva allegedly pulled off a $31 million embezzlement at Koss under the nose of Grant Thornton (Steve Chipman may need a pair of these to drown out the attorneys). [Milwaukee and Southeastern Wisconsin Business News]