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Footnotes: H&R Block’s New Biz; PwC Likes Its Bad Clients; SEC Teed Off | 08.18.14

Posted on by Adrienne Gonzalez

H&R Block launches small business accounting services [Kansas City Business Journal]

McDonnell defense emphasizes his openness to accountant Former Virginia Gov. Bob McDonnell's lawyers called their first witness this morning as they opened their case. First up for the defense: Brenda Chamberlain, a Suffolk-based accountant who kept the books for the Sandbridge real estate company McDonnell ran with his sister. [HamptonRoads.com]

PwC Didn't Want to Say Mean Things About Its Client An excellent summary of important events [Bloomberg View]

More UK companies reviewing their auditors – PwC Britain's top companies are reviewing early who checks their books ahead of new rules to increase competition introduced to counter concerns about accounting, figures from auditor PwC showed on Monday. [Reuters]

The SEC is really teed off about insider trading on golf courses [Fortune]

Fed says SEC money-market rule could spark, not reduce, runs [MW]

Related Posts

Charlie Rangel Needs Your Help

charlie-rangel.jpgFor those of you that don’t concern yourselves with civics nonetoomuch, Chuck is the chair of the House Ways and Means Committee. Ways and Means writes the tax laws for this fair land of ours. Get it?
Anyhoo, Rangs has a bit of a problem. People are shouting from the rooftops that this guy has to go. Why? A small matter of forgetting to list some assets on his disclosure forms.
Minor omissions, after the jump


Web CPA:

…in the Washington Post today decrying some of the newest revelations from last week, including a Merrill Lynch account valued between $250,000 and $500,000, tens of thousands in municipal bonds, and between $30,000 and $100,000 in rent from a Harlem brownstone that he owns, all of which he failed to list on his congressional disclosure forms from 2002 to 2006.

And if you remember:

This comes on top of the news last year about the four rent-stabilized apartments he rented at below-market rents, his use of government stationery to raise money for a pet project, his failure to report income from his sale of a Florida condo, and his failure to pay taxes on rental income from another home in the Dominican Republic.

According to the WaPo piece, Rangs’s net worth doubled-ish, “from between $516,015 and $1,316,000 to between $1,028,024 and $2,495,000”.
Yeah, so, that’s kind of a big change. We’re thinking that Chuck is way too busy being a tax wonk to track all this stuff. Or maybe he’s just too tired. Either way, it’s way easier to forget about four rent-controlled apartments than you think.
Rangel Under Pressure to Step Down [Web CPA Debits & Credits]

Because There is No Shortage of Criminals

fraud.jpgEditor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
Over the weekend, I had the pleasure of speaking with Sam Antar of White Collar Fraud. I won’t give him too many props (lest he think his wily criminal charms got to me) but our conversation was both relevant and disconcerting.
In case you aren’t acquainted with Sam, he’s the ex Crazy Eddie CFO who ripped them off and now does speaking tours talking about, well, crime. But there’s a lot more than that at work here, that’s just his schtick.


So what did I learn?
I believe my editor thinks I’m a doom and gloomer so here’s some good news: besides suggesting we start training more qualified forensic auditors fresh out of school, Sam insists there is a chance for real financial reform.
Do you take your reform advice from an ex-criminal? I remind you here that a tax cheat is in charge of the IRS, do with that information what you will.
Anyway, the point here is that financial statements lack integrity. Without integrity, investors are groping in the dark and criminals are able to execute their schemes. Foreign investors are scrambling to leave US capital markets, could that be because our statements are – generally speaking – unreliable?
So. Sam’s 3 step plan to restoring sanity to financial statements. Take it for what it is.
1. Redefine audit committees as truly independent. No member of the audit committee should derive a salary or other compensation from stock options or stock holdings. Period.
2. Committee members should be qualified. CPAs and securities lawyers are qualified to sit on an audit committee, not marketing managers and other “average” sections of the corporate population.
3. Forensic accounting should be standard curriculum in university accounting programs. Don’t eliminate 404(b), if a corporation can’t afford the audits required to be a public company, then don’t become one.
We’ll have to agree to disagree on that final point, I don’t think tedious audits are the solution. However, perhaps if we had more qualified auditors out in the trenches, I might be inclined to be slightly less skeptical about the effectiveness of more softcore audits.
Stay tuned as we’ll be picking Sam’s brain again soon.
GC Posts Referencing Sam Antar:
Grant Thornton: Patrick Byrne’s Pants Are on Fire
Obvious Sign of Fraud: You’re Having Sex with the Client

Footnotes: EY Looking to Do Some Law; Citigroup FAIL; AirBnB Begs to Pay Taxes | 03.28.14

Forget consulting, EY wants to provide legal services in the UK It said in a […]