Role of Auditors in Crisis Gets Look [WSJ]
Until this week when civil-fraud charges were brought against Ernst & Young LLP for its role in the collapse of Lehman Brothers Holdings Inc., auditors had largely side-stepped blame for the financial crisis.

Yet auditors had to pass judgment on some of the practices that caused the big losses that led to government bailouts. The case against Ernst highlights the roles accounting firms played and raises questions about whether reforms enacted after the last financial crisis went far enough.

Ernst & Young’s jujitsu defense [Colin Barr/Fortune]
The Ernst & Young statement suggests the firm will argue that it can’t be prosecuted under the Martin Act because Lehman, not E&Y, was the outfit actually producing the financial reports, and because it was Lehman, not E&Y, that was peddling billions of dollars of securities just months before its implosion. In this view, E&Y was just a gatekeeper hired to vouch for Lehman’s books, something it will claim it did well within the confines of the law. This strikes lawyers who are familiar with the law as an eminently reasonable approach, if not exactly a surefire recipe for success.

Crocs CFO resigns; shares slip [Reuters]
And the rubber shoes remain.

Monsanto names Courduroux to CFO post [Bloomberg]
And the bizarro food products remain.

Clifton Gunderson Acquires LA Forensic Practice [AT]
CG acquires Durkin Forensic with the deal effective January 1.

Paul Basso Joins PwC’s Risk Assurance Services Practice [PR Newswire]
PwC US today announced that Paul Basso has joined the firm as a partner in the Internal Audit Services practice. Basso joins PwC from Ernst & Young, where he was a principal leading the US Insurance Process and Controls practice. He will be based in Boston and will serve clients in the Northeast, which includes the firm’s offices in Boston, Hartford, Conn. and Albany, N.Y.

BDO signs firm partnership deal in Japan [Accountancy Age]
Toyo & Co and BDO’s existing firm Sanyu & Co will merge to form BDO Japan KK, the new member firm. Sanyu & Co was established in 1986 and joined BDO in 1996, while Toyo & Co was founded in 1971. The combined firm is expected to generate a fee income of €61m (£51.9m) for the year ending 2010.

Entrepreneurs Ask Santa for Loans, Lower Taxes [WSJ]
Loaded quote from the Journal, “Mark W. Smith, a founding partner of New York law firm Smith Valliere PLLC, has just one wish: lower taxes. ‘I lose half of my profits every year to taxes,’ he says. ‘They’re way too high and they’re hurting the growth of my business.’ “

Deutsche Punished On Bogus Shelters [WSJ]
Deutsche Bank AG agreed Tuesday to pay $553.6 million and admitted criminal wrongdoing to settle a long-running probe over fraudulent tax shelters that allowed clients to avoid paying billions of dollars in U.S. taxes.

Under a nonprosecution agreement with the U.S. Attorney’s office in Manhattan and the Internal Revenue Service, the German bank won’t be prosecuted for its participation in about 15 tax shelters involving more than 2,100 customers between 1996 and 2002, including shelters marketed by accounting firm KPMG LLP and defunct law firm Jenkens & Gilchrist PC.

Have audit rules been subtly rewritten? Three questions for the Big 4 [AccMan]
More questions after the revelation of the ‘secret talks’ in the UK.

Grant Thornton LLP elects one new member to Partnership Board [GT]
At Grant Thornton LLP’s Annual Partners Meeting in November, the partners and principals elected San Jose-based Jacqueline Akerblom, Audit partner, national managing partner of Women’s Initiatives and West Region North International Business Center director, to the Partnership Board.

Smith & Wesson Names Jeffrey D. Buchanan Chief Financial Officer [PR Newswire]
Smith & Wesson “a leader in the business of safety, security, protection, and sport,” names Jeffrey D. Buchanan as EVP, CFO and Treasurer (all positions require you to be strapped at all times).

Accounting Is a Sewer [JDA]
Sayeth perpetual accountant critic, Charlie Munger.

Christmas Gifts for that Special Tax Person [TaxProf Blog]
Three shopping days left.

CPAs in 49 states might meet experience requirement by working in industry [AW]
Michigan became the 49th state to accept industry experience for original CPA certification, leaving New Hampshire, Wyoming, and the U.S. Virgin Islands as jurisdictions that still do not accept industry experience.

Most state boards now accept experience gained by working in industry, government, and academia, as well as public accounting – a development that has received little attention in comparison with the movement to CPA mobility or changes in education requirements.

Audits of Bell were ‘rubber-stamp,’ state controller says [Los Angeles Times]
Seems to be going around.

Forensic Accounting and Al Qaeda [Freakonomics/NYT]
Getting to the bottom of the terrorist business.