Going Concern

PwC Partner, Not Wanting to Disappoint Guests, Has Open Call for Courageous Pianist

Caleb Newquist
October 5, 2010

When you become a partner at a Big 4 firm, there are many unexpected challenges that you will face. You may have a trusted senior manager quit in the middle of busy season. You may discover that someone who you thought was your best friend is actually primo inventory from the jerk store. And if you’re really unlucky, you may get bombed at a happy hour (allegedly!), then slug a couple people (allegedly!), kiss a couple more (allegedly!), not remember a thing, claim that you were roofied and have a stranger call you up out of the blue and ask you about it.

Anyway, we’ve been informed of another bitch of a situation that can arise when you become partner – when the entertainment for your little soiree cancels on you at the last minute:

From: [redacted]
To:
Cc: [redacted]
Date: 10/04/2010 01:24 PM
Subject: Are you courageous or just talented?

All —

I am having an event at my home tonight and my normal pianist has canceled on short notice. This is a test of the courage of you as a group of people.

I know someone is out there in our midst who in their spare time is a really good pianist. I would be eternally thankful if those of you to whom this note applies, would volunteer to help me out tonight. I know we hire people with many talents — the question is — do you have the courage to display them? The event is from 6:00 – 9:00 PM in McLean. You will be well fed. If you are interested, please contact [redacted]. Hopefully we’ll get more than one taker, and we will figure out who we should use.

The fact of the matter is, my event this evening will survive the lack of a pianist. What I am really trying to figure out is what we as a people at pwc [Ed. note: nice usage of the low caps!] are made of.

Thank you,

Jesus. Talk about a conundrum. And since Big 4 partners don’t pull down the kind of dough that could afford them a short-notice call to Elton, Harry Connick, Jr., or even a cheap Liberace impersonator, throwing a line out into the employee talent pool was the only option this partner had.

Unfortunately, since this opportunity was on such short notice, anyone with the necessary skills that is now just learning about it is SOL. With any luck however, you can volunteer your services as a solid pinch-hitter for future reference. God knows how that comes in handy.

Presumably you don’t have to be the next Mozart but if you can pull off some singalongs such as “Piano Man,” “Friends in Low Places,” and “Sweet Caroline” that will go a long way to nailing down that “eternal” gratitude (for a future event of course).

Accounting News Roundup: KPMG’s Hiring Spree in Europe; Herz Gets Nostalgic; Stalemate on Estate Tax Could Benefit States | 10.05.10

Caleb Newquist
October 5, 2010

KPMG joins Big Four hiring spree [FT]
The FT gives us the scoop on the Radio Station hiring bonanza in Europe (if you’re experienced go here), “KPMG is hiring 8,000 new staff across Europe over the next three years, signalling a recovery in the corporate services industry.

The hiring includes 3,000 staff in Britain, even though the UK government has pledged to cut its consultancy bill amid growing public unease over the billions of pounds spent on professional fees in the past decade.

The recruitment drive will take KPMG’s workforce from 30,0Europe, excluding France and Italy, and from 11,000 to 14,000 in the UK. KPMG also has ambitious hiring plans in France and Italy.

The corporate services industry had been hit by the global downturn, with the Big Four accountancy firms – KPMG, Ernst & Young, PwC and Deloitte – criticised for their role in signing off financial statements stuffed with assets that plummeted in value during the crisis.”

After Eight Years at FASB, Herz Looks Back [CFO]
Q&A with the man himself. Can you guess which accounting pronouncement he’s a big fan of?

Two Accounting Firms To Pay $1.7 Million To Settle CFTC Charges [Dow Jones]
“The charges stemmed from audits of Sentinel that were conducted between 2004 and 2006. The firms, McGladrey & Pullen LLP and Altschuler, Melvoin & Glasser LLP, agreed to pay $400,000 and $800,000, respectively, in restitution to Sentinel’s customers who suffered losses as a result of the Illinois-based futures commission merchant’s bankruptcy.

They were also required to pay civil monetary penalties of $150,000 and $350, 000, respectively, according to an order that was filed Monday. McGladrey & Pullen acquired assets related to Altschuler, Melvoin & Glasser’s audit practice in 2006.”

Ex-SocGen Trader Kerviel Convicted of Trading Fraud [WSJ]
” Paris court sentenced former Société Générale trader Jérôme Kerviel to three years in prison for his role in one of the biggest trading scandals in history, ordering him to repay a whopping €4.9 billion ($6.69 billion) loss suffered by the French bank.”

Investor Feedback Summary May Foretell FASB Retreat [Compliance Week]
“The Financial Accounting Standards Board may be sending up a smoke signal with an unusual missive describing how investors aren’t entirely in love with the board’s proposed new rules on financial instruments.

The board published a nine-page description of its interaction with investors regarding the FASB’s controversial proposal to call for more fair value in accounting for financial instruments. It opens with a reminder that FASB writes accounting rules to assure that financial statements produce information useful to investors, then explains how investors are reacting to the proposal when the board conducts face-to-face meetings with investors.”

State Estate Taxes: Windfall Gold in Expiring Tax Cuts [TaxVox]
States make out pret-tay well if Congress bumbles the estate tax.

U.S. hits AmEx with antitrust suit [WaPo]
“The Justice Department announced Tuesday that it had filed an antitrust suit against American Express for preventing retailers from offering customers discounts for using rival credit cards with lower processing fees.

Federal officials added that they had reached a proposed agreement with Visa and MasterCard over the matter.

The issue of ‘swipe fees’ has long been a thorn in the side of the retailing industry, which complained that it has little power to inform customers of the differences in card costs. In its complaint, the Justice Department estimated that the fees cost merchants $35 billion each year – resulting in higher prices for shoppers.”

LinkedIn and PwC Launch Breakthrough Career Mapping Tool for College Students [PR Newswire]
“LinkedIn, the world’s largest professional network with more than 80 million members globally, today launches Career Explorer in collaboration with PwC US, one of the largest employers of college graduates in the United States. The new LinkedIn Career Explorer tool provides current college students with unique, data-driven insights to help them build their careers.”

A Shift at the Top of Twitter [DealBook]
“Evan Williams, the co-founder and chief executive of Twitter, is stepping down to lead product strategy at the company, Twitter announced on Monday. Dick Costolo, the chief operating officer, will succeed Mr. Williams.”

Quote of the Day

Citi Failed to Impress Mike Mayo

Caleb Newquist
October 5, 2010

“Citi still seems to have aggressiveness with financial targets (well above historical), accounting (tax credits) and corporate governance. Also, the strategy does not always seem in sync with execution and/or financial reporting.”

~ It isn’t known what the Credit Agricole Securities analyst thinks of the auditors.

News

Hot Aspiring Accountant Loves to Listen, Manscapes, Needs Your Votes

Caleb Newquist
October 5, 2010

Whenever we can, we like to sex things up around here. Sometimes it can be difficult but fortunately, this is not one of those days.

This young chap is Carl Koenemann he’s representing Missouri in Cosmo’s Bachelor Blowout and he just happens to be studying the debit and credit trade.

A few swoon-worthy details on Carl: 1) He plays guitar and writes songs; 2) He craves being told that he’s a good listener; 3) He’s perplexed by a woman who thinks he should be able to read her mind; 4) Affirmative on the manscaping question.

Now some ignorant hack at the Riverfront Times thinks that young Carl is “throw[ing] all [his hottness] away to become a buttoned-down bean counter” but that is just one blogger’s shitty opinion.

We think (and we’re sure you agree) that there’s plenty of room for hot men and women in the accounting field. Not that we’re suggesting that Carl completely dismiss his chance at eating disorders or a career in reality TV but we’re sure he’ll have campus recruiters from all Big 4 firms drooling over him, so his career will be just fine.

Missouri Bachelor 2010 [Cosmopolitan]
Carl Koenemann: Manscaping, Accountant Wannabe Needs Your Vote for Sexy Man Contest [Riverfront Times]

Official New PwC Logo Launch Day: What Are You Doing with Your Old Business Cards?

Caleb Newquist
October 5, 2010

Just in case you forgot gang, today is the official launch date for PwC’s new brand and logo. Despite the fact that everyone knew about this weeks ago, early October seems like the perfect time to remind people of how lovely it is to play Pong amongst the fall foliage, .

The other significant event of this day also reminds us of trees but not in a good way. You’ll remember that Bob Moritz stated in his FAQ (that don’t address color or shapes) that today would mark the day that new stationary would be put into use. This means that metric asstons of old PwC stationary, business cards, pens, tchotchkes, undies and so forth would be rendered completely useless.

This is especially awkward since P. Dubs just got done slapping themselves on the back for getting greener faster than a Whole Foods employee at sustainable living festival.

It’s entirely possible that the firm has undertaken various ideas to stem the amount of waste such as:

1) Encouraging everyone to use letterhead en masse running up to the logo launch
2) Having yard sales at offices nationwide to cut losses
3) They’re talking to the Met about a major donation to a future “Historical Corporate Crap” exhibition.

OR maybe they’re just having a giant weenie roast followed by s’mores for dessert (which we admit, would be pretty fun). If you’re engaging in a ritual of some sort and feel compelled to document the event, do get it touch with us and enjoy your fresh business cards.

Earlier:
Just in Case You Didn’t Think the PwC Rebranding Was Actually Happening

News

Soon-to-Be KPMG Associate Bounces Back From Accountant Hate Crime

Caleb Newquist
October 4, 2010

We just got presenting you with some options for dealing with the occasional dick at your job. It goes without saying that 99% of the time, confrontations at the office don’t resort to fisticuffs but as we’ve detailed in these pages, accountant abuse is all too common – both verbal and physical.

Today’s account of bean counter beat downs is actually a positive one, as Bryan Steinhauer – who is starting at KPMG next month – has recently passed his first section of the CPA exam after suffering an assault in 2008, spending three months in coma and “endured thousands of hours of speech and physical therapy.”

We should clarify that Steinhauer was not not beaten because of his aspiring accountant status but because he was “allegedly dancing” with some dude’s girlfriend (which is punishable by death in some countries):

The 2008 assault near Binghamton University left Steinhauer with severe brain injuries. Doctors didn’t know if he would be able to speak again, let alone if he would live.

Now, two years later, as Steinhauer’s attacker Miladin Kovacevic prepares for prison, the resilient Brooklyn man is poised to pick up where he left off.

Steinhauer, 24, is about to start work at the accounting firm KPMG, capping a comeback that hospital officials call “mind-boggling.”

“I’m ready to move on to the next stage of my life, doing what I was meant to do,” a beaming Steinhauer told the Daily News. “It’s the biggest thing for me – to reclaim my life.”

Steinhauer has reason to be confident. Last week, he found out he passed the first part of the notoriously difficult CPA exam – no small feat for someone who suffered brain injuries so severe his memory was erased.

So, in case you don’t think you’re capable of bouncing back from a 74 on FAR, this guy recovered from brain damage and no memory to pass one part of the CPA exam. Normally, we’d suggest Adrienne chime in with some words of encouragement here but we don’t think it’s necessary.

Bryan Steinhauer reclaims life following brutal 2008 assault by Serbian athlete Miladin Kovacevic [NYDN]

Career Center

How To Deal with a Jerk at Work

GoingConcern
October 4, 2010

The following post is republished from AccountingWEB UK, a source that delivers topical, practical content to accountants and accounting professionals.

Probably one of the worst aspects of being in practice – or indeed of any working environment – is having to deal with difficult people. Sole practitioners who operate without staff and who are very choosy about their clients may only encounter difficult people in HMRC. At the other extreme, a manager in a larger firm might encounter difficult colleagues, junior staff, partnwell as fellow professionals in other firms and employees at all levels in HMRC.

Most of us have to deal with difficult people at work. How difficult a person is to deal with depends on our self-esteem, self-confidence and our professional courage. Dealing with difficult people is easier when the person is just generally obnoxious or when the behavior affects more than one person. The task becomes much tougher when they are attacking you personally or undermining your professional contribution.

Your basic options
One way or another you have to decide whether to ignore the difficult behavior (perhaps you will rise above it); to confront the person; delegate your dealings with them (whether to a colleague, a junior person or a more senior one); or remove the need for interactions (whether by you or them leaving the position that gives rise to the difficult interactions).

Ignore the behavior
This is easier said than done, and may come across as submissive or non-assertive. It is rarely the best solution except on those occasions where you will not need to interact with the person again. In such cases you may get what you need or resolve matters simply by ignoring their challenging behavior.

Confront the person
This requires you to be assertive and to avoid the temptation to be aggressive. This means you must accept that however difficult the other person may be, they still have rights and so do you. When you are assertive you recognize that you are entitled to information, clarification or a reply but that your entitlement is no greater (or less) than the other person’s entitlement to respect, politeness and honesty. When you act aggressively, you deny the other person their rights.

The other option is to act submissively or non-assertively, which means you deny your own rights. If this is your default position then you would probably benefit from some assertiveness training. It’s hard to respect non-assertive professional advisers.

Of course, this is easier said than done. Many of us have worked for an aggressive boss who we think revels in their ability to bully us. This may force us into a non-assertive stance. It will rarely enable us to get the best outcome.

Assertiveness is a skill. It’s not natural for everyone and can take practice to strike the right balance so that you do not come across as aggressive. Being naturally assertive is a skill worth developing.

Delegate or share
I’m a firm believer in keeping the end in mind, by which I mean focusing on the desired outcome.

Let’s say you are having difficulty securing the desired (fair) outcome in negotiations with an inspector at HMRC. Might someone else in the firm have ideas that could help resolve things? Is it more important that you be seen to have resolved things alone or that you/the firm secures the best possible outcome?

If a difficult client is taking too long to produce the necessary papers or to respond to your enquiries, perhaps someone else could go to meet them face to face or simply to collect things?

Removal
The drastic solution is to resign and move on, arrange for the difficult junior staff member to be moved on (following due process of course), or to tell the client that you no longer want to act for them (yes you can!).

News

Vault Accounting 50: #31 – #40 (2011)

Caleb Newquist
October 4, 2010

As we continue to mosey through this year’s Vault Accounting 50, we find a number of well known regionals in the #31-#40 range.

If you have any inside news, gossip, intern chicanery and the like for any of these firms, shoot us a message at tips@goingconcern.com.

31. BKD, LLP – Springfield, MO
32. Weiser LLP – New York, NY
33. Baker Tilly Virchow Krause, LLP – Madison, WI
34. Amper Politziner & Mattia, LLP – Edison, NJ
35. LarsonAllen LLP – Minneapolis, MN
36. Anchin, Block & Anchin LLP – New York, NY
37. Novogradac & Company LLP – San Francisco, CA
38. UHY Advago, IL
39. Wipfli LLP – Milwaukee, WI
40. Beers + Cutler PLLC – Vienna, VA

Here’s the buzz from Vault:

BKD, LLP – “Competitive, well known”; “Opportunities for advancement adhere strictly to a set tenure schedule”

Weiser LLP – “Strong overall”; “In trouble, needed bailout”; “Great place for masochists”

Baker Tilly Virchow Krause, LLP – “They’re moving up”; “Structured, suit and tie, no open-door policy”

Amper Politziner & Mattia, LLP – “Outside-the-box thinking is encouraged”; “Poor work environment, partners will throw you under the bus”

LarsonAllen LLP – “Progressive, growing”; ” ‘They do not reward’ those whose positions require more off-site time than others”

Anchin, Block & Anchin LLP – “Well respected”; “Benefits could [be] better”

Novogradac & Company LLP – “Large competitor in the real estate auditing business; specializes in low-income housing”; “Does awful work”; “Large tax practice, very little audit work”

UHY Advisors, Inc. – ” ‘More collegial and less hierarchical’ than at bigger firms”; “Diversity is ‘virtually nonexistent’ “; “In trouble, on the decline”

Wipfli LLP – “Partners are top tier for a small firm”; “Who?”

Beers + Cutler PLLC – “Pay is ‘well above the Big Four firms’ “; “Needs to have more diversity at the manager level”

And a bit of news on these firms in our pages:

• BKD picked up Grant Thornton’s community hospital practice in Witchita, KS this summer and a partner died of a massive heart attack in his office.

• Weiser announced their merger with Mazars back in the spring and we spoke with Weiser’s Doug Phillips about the combination.

• Baker Tilly Virchow Krause merged with Beers + Cutler last November and they are also picking up the pieces at Koss.

• Amper Politziner & Mattia happily (?) became the second half of EisnerAmper.

• UHY got out of New England

Discuss, deride and whathaveyou for the 31 to 40 crowd.

Grant Thornton

Grant Thornton Is Done Selling: Acquires Huron’s Disputes & Investigations Practice

Caleb Newquist
October 4, 2010

If you had to judge the state of Grant Thornton based on the activity over the past year, you might assume that the firm was headed downhill because of their disposal of several offices around the country. Despite the haters and accent conspiracy theorists out there, Stephen Chipman was confident about the future. So much so that he sent hand-written notes to all of you encouraging you to become GT evangelists.

Now this morning, we learn that this unleashing of dynamic potential clients could be taking shape:

Grant Thornton LLP said Monday it has acquired the assets of Huron Consulting Group’s disputes and investigations practice in a deal that will bring 60 people to Grant Thornton’s offices in Boston, Chicago, New York and San Francisco.

The acquisition is part of Grant Thornton’s strategy to double revenue in the next five years. Huron Consulting has divested itself of its disputes and investigations practice. Huron’s D&I employees will join Grant Thornton’s economic and advisory groups in four cities, including Boston.

Well! This is quite the acquisition. Since GT and Huron are both Chicago-based, there is likely a lot of connections here that helped make this deal happen. Huron’s press release states that the D&I group (the smallest inside the company) had been on the block because the overlords wanted to focus its efforts on “businesses [with] a more substantial market presence”:

The Company stated previously that it was evaluating the long-term prospects of its D&I service line, which had accounted for approximately 5% of the Company’s overall revenue for the first six months of 2010. “The Disputes and Investigations practice has been a part of Huron since our formation in 2002. We recently conducted a comprehensive assessment of all of our businesses and concluded that the divestiture of the D&I practice would enable management to devote more of its energies and financial resources to businesses where we have a more substantial market presence,” said James H. Roth, chief executive officer, Huron Consulting Group.

[…]

Huron is also revising its 2010 revenue guidance based on the divestiture of the D&I practice and other market factors impacting two reporting segments. When the Company announced second quarter results in July 2010, it provided a 2010 revenue guidance estimate between $600-$620 million.

Based on the divestiture of the D&I practice, the 2010 Company revenue guidance would have been reduced by $35-$40 million. In addition to the D&I divestiture impact, the Company is reducing its annual guidance by an additional $25-$30 million to reflect contract and project delays in two of its service lines: Healthcare and Accounting Advisory.

On the surface, it may look like a good deal for both companies but in reality it feels like Huron was desperate to sell a good revenue-generating unit (19% as of June 30, 2010) and since GT is definitely shopping for acquisitions, the firm was more than happy to take it off their hands.

This acquisition will allow GT access to a sexy area of advisory work (D&I consists of “business disputes, forensic accounting and investigative services, tax controversies and intellectual property disputes”) in key markets and presumably, they can hype the new group internally to expand it and compete for more business.

The only possible downside is that some inside GT may be concerned (we’re speculating here) about taking on more Andersen refugees but ultimately it looks like a good move and the first example of the firm making good on its new strategy. If you’ve got a different opinion, chime in below.

Grant Thornton buys Huron operation [Boston Business Journal]
Huron Consulting Group Announces Divestiture of Disputes & Investigations Practice to Continue Focus on Core Businesses [EON]

More KPMG Comp News: For Some In Chicago, Expectations Are More or Less Met

Caleb Newquist
October 4, 2010

Some of you may have heard enough KPMG compensation news but judging by traffic patterns, most of you have not. And reports are still coming in, so it’d be a disservice to keep you in the dark.

The latest news out of Chicago:

This info is for Chicago, Audit. Most of us had our talks Thursday or Friday, however I hear that some are still continuing into Monday.

A2 to SA1, SP+ rating, received 10% raise and 2% bonus. Same level, EP rating, received 13% raise and 5% bonus. I am also finding out that SP vs. SP+ has no difference at all. This is based on a salary of $56,000 which was our original starting salary (also included a $5000 sign on bonus) as we received no raise last year. This is pretty much in line with what the now S2’s received over the past couple years, as they got 5% raise after their first year and 5% raise for being promoted to senior last year when everyone’s salaries “stayed flat” as my partner put it. What I would really like to know is what A1’s to A2’s received, as last year they had the same starting salary and bonus as what I began with, so they were essentially making more than A2’s for an entire year due to the bonus.

SA 2 to SA3, EP rating, 8% raise and 5% bonus. My managers also don’t seem to excited, but I obviously did not ask them what their actual numbers are.

I believe everyone on my team feels this is what they expected raise wise, but are rather disappointed with the bonuses. Some additional information, raise numbers are consistent across all business units within the office.

It’s also our understanding that convos are still going on in New York this week, so continue to keep us updated.

The JDA

Is The AICPA Cheapening the Profession with New Membership Rules?

Adrienne Gonzalez
October 4, 2010

Someone has to ask the question and as a matter of fact Sharon Gubinsky, one of our favorite Maryland CPAs, already has.

Before we get to Sharon’s enlightening comments, however, let’s examine the AICPA’s idea to expand membership to non-CPAs. As is, AICPA membership is limited to those who hold a current CPA certificate. Since the AICPA is a professional organization charged with protecting the protectors, you’d think it would be simple to decide who can and cannot join the organization.

Those of us affiliated with the industry but without CPA certificates are more than welcome to cheer from the sidelines but are rightfully barred from membership in an organization that oversees licensure and sets the overall tone for CPAs across the country. But here are the proposed changes:

In May 2010, the AICPA governing Council unanimously voted for a member ballot on a proposed bylaw amendment to update the requirements for admission to the Institute. This recommendation is a part of the first major comprehensive review of membership requirements since the 1950s. The bylaw amendment would add a provision to the current CPA certificate requirement for voting membership. Therefore, if the ballot measure were to pass, individuals could become voting members of the AICPA if they meet at least one of the following criteria:

1. Possess a valid and unrevoked CPA certificate issued by a legally constituted authority, the present requirement for membership.

2. At any time possessed a valid CPA certificate and the certificate was not revoked as a result of a disciplinary action (i.e., the certificate holder allowed the certificate to lapse because they were not providing public accounting services and therefore the certificate was not required by their state board of accountancy).

3. Fulfill the education, examination and experience requirements of the Uniform Accountancy Act (UAA) for CPA certification (see Appendix B) and are of good moral character but have never been granted a right to practice because they do not hold out as CPAs.

Back to Sharon. Not arguing with the first two requirements (nor am I), she and many others take issue with the third. Why on Earth would someone meet every requirement for licensure and choose not to be licensed but still wish to be a member of a large, influential professional organization like the AICPA?

She says:

An additional sore spot for current members opposed to this amendment is that in order to maintain an active CPA license a required amount of continuing education credit hours is mandatory. For the State of Maryland the State Board of Accountancy requires eighty hours of CPE every two years in order to renew your license. Those without a valid license are not subject to this requirement. Not only is the CPE a scheduling issue at times due to billable client work but it is not cheap. The average cost for eight hours of training is approximately $300.00. The positive note is that the CPE requirement does keep us informed and refreshed.

Having a CPA license keeps CPAs incentivized to protect the public and adhere to the AICPA Code of Professional Conduct that gives that credential such weight. There is some level of prestige in saying one has accomplished it and a level of service to the public interest required by those who hold it. So why open up AICPA membership to anyone who could be a CPA if they put in the legwork but haven’t?

I think an associate membership idea – if additional membership revenue is what the AICPA is after – is an excellent idea and I for one would be one of the first non-CPAs to sign up just to show my commitment to what the industry stands for. But that doesn’t mean non-CPAs should be allowed to vote on issues important to CPAs, regardless of how intimately acquainted with the profession and the industry’s professional standards one might be.

Licensed CPAs? Yes.

Inactive CPAs? Yes. They still put in the work to pass the CPA exam and secure experience, they have simply chosen to drop out of public or move into a different line of work. That does not negate their professional experience.

Non-CPAs? NO.

Accounting News Roundup: Investigation of E&Y Over Lehman Begins in UK; Study: Mortgage Interest Deduction Doesn’t Increase Home Ownership; PwC Announces Revenue Numbers | 10.04.10

Caleb Newquist
October 4, 2010

E&Y auditors investigated over Lehman Brothers [Accountancy Age]
“The Accountancy and Actuarial Discipline Board (AADB) has begun an investigation of E&Y in its role in reporting to the FSA on audit client Lehman Brothers International Europe’s compliance with the authority’s client asset rules, which govern the protection of client money.”

And since they were on a roll, the AADB is also investigating PwC for its role in J.P. Morgan’s misuse of client assets.

Study Finds the Mortgage Interest Deduction to be Ineffective at Increasing Owneref=”http://www.taxfoundation.org/blog/show/26762.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+TaxPolicyBlog+(Tax+Foundation+-+Tax+Foundation’s+%22Tax+Policy+Blog%22)”>Tax Foundation]
“Proponents for the MID often offer the justification that it increases homeownership rates, which they say has positive benefits for society. But most economists seriously question the benefits of MID and many believe homeownership is greatly over-subsidized.”

Visa, MasterCard Antitrust Decision by U.S. Said to Be Near [Bloomberg]
“The U.S. Justice Department may decide as early as this week how to resolve its two-year antitrust probe of merchant restrictions imposed by Visa Inc., MasterCard Inc. and American Express Co., three people briefed on the matter said.

The department still hasn’t decided whether it can reach a deal with the three biggest U.S. payment networks or challenge their policies in court, one of the people said. The department likely will file a lawsuit, and MasterCard and Visa are expected to settle, people familiar with the matter said.

The talks focus on rules that bar merchants from charging extra to customers who use credit cards and steering them to competing cards, and require retailers to accept every type of card banks issue, said the people, who requested anonymity because the discussions are private. The department is leaning toward allowing the companies to maintain prohibitions against surcharging, two of the people said.”

Will KPMG Ever Wake Up and Finally Learn Its Lesson after Being Duped into Completing Crazy Eddie’s Audits Too Early Twenty Three Years Ago? [White Collar Fraud]
Today’s lesson in duping auditors – Sam Antar explains exactly how he fooled KPMG (then Peat Markwick Main) into signing off on incomplete audits back in the 80s.

PwC takes $26.6bn in global revenues [Accountancy Age]
Thanks to the miracle of rounding, $26.6 billion puts P. Dubs in a tie with Deloitte for largest firm in terms of revenues, who reported the same number last month. This obviously will not stand and we will investigate the matter further to the appropriate number of significant digits to determine who the top dog is.

Citi says CEO, CFO “rebutted” Mayo’s criticisms in meeting [Reuters]
On Friday, banking analyst Mike Mayo met with Citi execs including CEO Vikram Pandit and CFO John Gerspach and they discussed, among other things, why Citi hasn’t been writing down their DTAs. Citi says that successfully rebutted the Mayo Man who is issuing a report today with his thoughts on the sit-down.

Accountant gets year-and-a-day in Petters scam [Minneapolis Star-Tribune]
“Harold Katz, the hedge fund accountant who doctored financial statements to hide the Petters Ponzi scheme from investors, was sentenced Friday to 366 days in prison after apologizing to family, friends and investors.

Katz, 43, will be eligible for parole in about 10 1/2 months. He was sentenced for conspiracy to commit mail fraud.

‘I made a colossal error in judgment,’ Katz told U.S. District Judge Richard Kyle. ‘I hope I can use this horrific experience to help others not make the same mistakes as I have.’

Katz created false financial statements at the behest of Gregory Bell, manager of Lancelot Investment Management, a Chicago-area hedge fund, to mislead investors about the stability of Petters Co. Inc., which was defaulting on various promissory notes as its decadelong Ponzi scheme unraveled in 2008. Katz also assisted Bell in making phony banking transactions with Petters Co. Inc. to make it appear the Petters Co. was paying off notes it owed to Lancelot.”

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