All this IFRS hubbub is going to be expensive and time consuming anyway so let’s just forget it, shall we?
Eh, not so fast, IFRS haters. The remaining 60% of the respondents did state that they thought that IFRS should be required at some point in time, including 7% that want it ASAP, thanks.
Part of the resistance may be that lots of CFO/controller types have got no idea how IFRS is going to affect their company’s reporting. GT’s survey shows that 90% of the respondents don’t use IFRS currently and earlier this summer another survey cited that many CFOs weren’t even sure how IFRS would affect their reporting.
The IASB is clearly serious about the whole thing, and the FASB, while less excited, seems to be on board, along with big shots like Jim Turley. Finance execs can stall all they want but eventually IFRS will be all up in their business. Probably should get crackin’.
40% of U.S. senior financial executives don’t want IFRS to replace GAAP [GT Press Release]
Category: Uncategorized
Today in Bad Decisions: Borrowing Money from Your Ex-Mother-in-Law
Do you have a mother-in-law? How well do you get along with her? Not good, huh? Whatever differences you may have, surely it’s not this bad:
When a former son-in-law in Illinois failed to settle an asserted loan by his ex-mother-in-law to her satisfaction, she gave up on collecting but issued a 1099-C reporting the amount as debt forgiveness income.
Ex-Son-in-Law took it badly, and fought back. He sued Ex-Mom, claiming that because she wasn’t required to issue a 1099-C, it was fraudulent for her to do so.
Borrowing money from your mother-in-law, let alone your ex-mother-in-law is not what we would consider a good life decision. Jesus, especially if you’re a deadbeat. We understand that times are tough but hey, next time around he’ll know.
So this guy is in a tough spot. Solution? Sue her for fraud, of course! The judge in the case said someone issuing an unnecessary 1099 did not constitute fraud so the son’s only remedy now is to argue that the contents of said 1099 were fraudulent. Good luck with that, man. You’re finished.
A Victory For Bitter Ex-Mother-In-Laws Everywhere [Tax Update Blog]
We’d All Appreciate It if Grant Thornton Got Involved in a New Lawsuit
Grant Thornton just isn’t able to shake Parmalat, the freaky-ass extended-life milk company. Parmalat appealed the latest dismissal of its lawsuit against GT and Bank of America that accuses the two companies of helping set up phony transactions so “insiders could steal from the company.”
Parmalat’s Chief Milk-Magician, Enrico Bondi, is obviously not satisfied with the $100 million that he twisted away from BofA and will continue to hassling both companies until long past the expiration date on his product.
Parmalat appeals BofA, auditor lawsuit dismissals [Reuters]
Employee Satisfaction Survey: GC Edition
In the spirit of what appears to be survey week, we’re honoring requests to do our own survey. Plus we’ve been inspired by some questions that we’ve seen in the comments.
We’ve presented a few questions for you to answer, after the jump. Feel free to add your more appropriate “D” answer to any of them. We also encourage you to keep submitting your questions with multiple choice responses.
Question 1 – I feel that I am recognized for my performance:
A. Too frequently by ass-grabs.
B. Not frequently enough by ass-grabs.
C. I prefer to not be recognized for my performance because I don’t like anyone talking to me and if I have one more conversation with one of these idiots I’m punching that idiot in the face.
Question 2 – Leadership’s communication:
A. Is jamming up my inbox to the point that I can’t locate my porn newsletters.
B. Is helpful when I’m having trouble vomiting.
C. Would be much more tolerable if it was a show tune sung by Hugh Jackman.
Question 3 – I feel that my compensation:
A. Is about as fair as getting kicked in the genitals on a daily basis.
B. Is appropriate if I had not finished high school.
C. Makes my friend, who delivers newspapers, laugh.
Grant Thornton Survey: Financial Statements Are Still Too Complex for the Average Shmo Investor
That’s right! Way too complicated. GT’s survey states that 73% of the finance bigwigs surveyed believe financial statements are too complex for the average investor to understand. That’s bad because even more respondents (82%) said that financial statements should “be prepared to meet the needs of the average investor”.
Strangely, this survey’s respondents, “CFOs and senior comptrollers”, are directly responsible for the still-too-confusing financial statements. Unless, of course, everyone that responded to this survey already has easy-to-understand financials and thus, is thinking, “NMFP”.
Also, average investor is not explicitly defined which doesn’t help us put the survey in context. So we’ll put it out there that if “average investor” is anything remotely similar to the “average American”, the solution to this whole problem may be to get Fisher-Price and reality TV producers involved.
Nearly three-quarters of senior financial executives say financial statements too complex for investors [Press Release]
$500k Will Not Satisfy One CPA’s Quest for Vindication
A CPA in Redmond, Washington is receiving $500,000 from the state’s board of accountancy after battling with them for nearly five years over a disciplinary action that probably should have been NBD.
D. Edson Clark had claimed that the state Board of Accountancy was improperly pursuing unwarranted charges against him in retaliation for complaints he had made about the handling of another case. He requested tens of thousands of pages of public records and launched seven lawsuits against board employees over the past two years.
Clark was very determined to clear his good name. So much so that the Board of Accountancy claimed, “it has been disrupted by Clark’s requests, and that his demands for public records are burning up its budget and limiting its ability to function.” Apparently, the Board was so overwhelmed that it threatened Clark with an anti-harassment complaint because the volume of emails he was sending was disruptive.
This brings up some questions: A) How many emails does it take to disrupt an office? B) Did they try hiring a temp? C) Was Clark spending his entire day copying and pasting the same email over and over or was he drafting individually scathing rants? D) At what point does a person cross the line of crazy-ass obsession?
Despite the metric asston of emails received by the Board, a judge in one of Clark’s lawsuits was not impressed with the Board’s handling of the situation:
In an oral hearing in June, Judge Thomas McPhee, a judge in Thurston County Superior Court, said that the board had “developed a pattern of incompetence in answering these discovery requests that is just difficult to believe for a state agency.”
We’re all familiar with governments’ inability to do much of anything but for a judge to put the situation in this context might be a new low for bureaucratic inefficiency.
Don’t worry though, the saga isn’t over as Mr. Clark has indicated that he plans further litigation in order to FULLY EXONERATE himself. Nevermind that the $500,000 is over a third of the Board’s budget. This is obviously personal. We admire the gusto.
Redmond CPA to get $500K settlement from state board [Puget Sound Business Journal]
Redmond accountant, Washington regulator at odds [Puget Sound Business Journal]
Bonus Watch: Follow-up on Grant Thornton
According to a tip we received, less than “special” people at GT are receiving bonuses too:
Based upon my salary [the bonus is] about 2%….[I’m] assuming the criteria for a bonus wasn’t as stringent as Nusbaum made it out to be, or the pool was larger than we were led to believe. Based upon the call with Nus, I figured only 5.0 would get a bonus.
A pleasant surprise for some. This particular tip came out of the Southeast region. Apparently these conversations are occurring circa now so continue to keep us updated for your city or region.
IASB: You Want a New Fair Value Rule? You Got It. Just Don’t Ask Us About Convergence
There’s no doubt that you’ve been awaiting the IASB’s new fair value rule with feverish anticipation. Well, your wait is nearly over because when Sir David Tweedie says he’s going to do something, by God, he means it:
In an address to a meeting of European Finance Ministers, which have in the past been critical of the IASB’s response to the financial crisis, Tweedie has sought to ease concerns by announcing that he is on track to deliver a new fair value standard by the end of this year.
“I gave a commitment to deliver on this timetable. We will publish the new standard in November,” he said.
This is all very exciting for Tweedie and the IASB since it feels pretty damn good anytime you stick it to your critics but…
Small problem: The new rule still won’t require loans to be marked to fair value which is the exact opposite plan of Bob Herz and the FASB, “FASB’s proposal will see all assets measured at fair value. The IASB’s mixed measurement model would see banks’ loan books valued on an amortised cost basis.”
Obviously the two rulemakers, fresh off the tongue lashings they received from their respective governments for their part in the worldwide economic meltdown, decided that they had no choice but to put out the fair value fire pronto. Meanwhile, convergence of accounting standards (what the IASB is really serious about and could be the next Big 4 gravy train) remains a pipe dream.
Fair value standard will be released next month: Tweedie [Accountancy Age]
‘Your Regular Conspiratorial Conversations May Resume Tomorrow’
From one of the usual suspects earlier this week:
DATE: October 14, 2009
TO: All Personnel, Washington, DC office
FROM: [Redacted]
SUBJECT: Outside visitors in the DC Office- October 14.
We have visitors in the DC office tomorrow October 14th in the 6th floor main conference room from 8am – 4:30pm which include senior partners and government officials from various agencies. Please be mindful of your conversations in and around the office.
Thank you.
So, Ixnay on the Project Dark Wing talk.
Arnie Signs 150-Hour Rule for California
No one panic, if you get licensed before 2014, you’re grandfathered in as substantially equivalent. So if you feel like procrastinating, don’t let us stop you but maybe keep the date in mind.
In addition to the new credit hour requirements, Ah-nuld also signed bills requiring mandatory peer review for CPA firms starting next year and requiring non-active CPAs to disclose their status. We thought those were both standard operating procedure but a couple more laws won’t hurt anything.
If you can’t bear the thought of 25-30 extra credit hours in college, move to Colorado, Puerto Rico, or the Virgin Islands as they’re the holdouts on the 150 credit-hour requirement.
California Adopts 150-Hour Rule [Web CPA]
Let’s Try and Forget About Money
We realize that might sound like kooky-talk but we said try you twerps.
Ajilon Professional Staffing released its salary guide for 2010 and is predicting a decrease in salaries of 0.85% overall. CFOs and Treasurers are expected to take the biggest hit with an expected drop of 7.7%.
Now before you all start belly-aching about less money, the report does indicate that because of regulatory and compliance changes the scope of positions for those with backgrounds in accounting and finance will broaden.
More survey results after the jump
Additional findings:
• The majority of accountants (86%) believe that the convergence from U.S. GAAP to International Finance Reporting Standards (IFRS) will have a positive impact on the finance/accounting profession.
• The demand for financial analysis, budgeting and forecasting due to the recession will be the #1 driver of job opportunities for accounting professionals, followed by the transition to IFRS and the economic stimulus package.
• No surprise, nearly 60% of accountants say they have been spending more time on cost-cutting initiatives as a result of the recession and financial crisis. Some of the things they have been doing to reduce expenses include: cutting discretionary spending; taking a harder look at business lines, product and sourcing; and increasing attention to driving reported earnings and cash flow.
• Fifty-one percent (51%) of accountants said they have imposed across-the-board spending and capital freezes as a result of the recession.
So the last two bullets probably are of most interest because, you know, some of you are intimately familiar with them.
Nevermind that though, it’s in the past. IFRS, even if it’s a DeLorean ride away and government overhaul fever will create jobs for you and you’ll all be back in your McMansions in no time. At least attempt to channel some of that Tony Robbins shit.
Or continue being bitter, whichever.
Ajilon Professional Staffing releases 2010 Salary Guide [Press Release]
Codification Will Affect You Whether You Like It or Not
In case you’ve forgotten, the new FASB Accounting Standards Codification is all up in your shit since it is effective for all financial statements dated after 9/15/09. One source is already less than enthused about the whole thing:
[From] what I can see it requires you to go through your financials and any place you referenced something like FAS 142 you have to change it to reference one of the like 5,000 topics, subtopics, sections, paragraphs, and subparagraphs within the standard. I think Operating Leases (Lessee) will now be labeled as follows (I am serious): “840-20-a”
After we got the vomit out of our mouths, we realized that this new reference has an uncanny resemblance to IRC referencing but maybe that’s just us. This is especially disheartening for those partners who spent their entire careers committing SFASs, EITFs, and APBs to memory so that they could be the go-to technical accounting wonk. So if that’s you, consider your life’s work completely ruined.
And the PCAOB has kindly reminded you that you get NO SAY in this matter, so just accept it. On the bright side, new associates will be starting or have already so replacing all those references on workpapers should keep them busy chargeable in between making copies and calling/emailing India to check on the cash reconciliations.
This will probably give more than a few of you heartburn this season but some of you may remain clueless about it until the eleventh hour which will make for some excitement. Discuss your excitement/melancholy in the comments.
UPDATE: We had short chat with one Big 4 auditor who summed it up this way, “its fuckin retarded espcially if convergence is happening soon.” Very poignant. Convergence and soon are obviously subjective but the point is duly noted since any sort of global standards would no doubt torch the FASB’s codification.