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September 25, 2023

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Monday Morning Accounting News Brief: UK Big 4 Firms Overhired, Dump Staff; KPMG Bracing For (Another) Big Fine | 9.25.23 Friday Footnotes: Remembering Legend Sid Kess; Andersen’s Doing Great; Poland Banned Deloitte From Auditing? | 9.22.23 Now the Profession Is Losing Experienced Accountants Too Opinion: On-the-Job Experiential Learning Credit to Meet the 150-hour Requirement Makes Sense Look What PwC Made the Australian Government Have to Do

AICPA Council

CPA Exam

AICPA Seeks to Better Weed Out Losers, Misfits with Evolved CPA Exam

by Adrienne Gonzalez

We heard they want to make BEC an 8 hour marathon just for kicks.

Career Center

Here Is Why You Should Care About What Went Down at AICPA Spring Council This Year

by Adrienne Gonzalez

When I attended my first AICPA Council meeting in 2011, I remarked that the room seemed to be filled with the same "old white guys" that have been "leading" the profession as far back as we can all remember. I asked out loud why I seemed to be the only person under the age of […]

Audit

Audit Leaders Use AICPA Council to Vent About ‘Crisis’ at Partner Level

by Adrienne Gonzalez

Knowing you guys as well as I do, I realize it's pointless to bore you with details from Council; like how Tom Hood got snapped at by a very frustrated Maryland senator in her office or what people wore to last night's black tie gala. However, I will share with you an interesting panel yesterday […]

Financial Reporting

Kroeker Gets Cranky With the AICPA’s Private Company Accounting Ideas

by Adrienne Gonzalez

Apparently SEC chief accountant James Kroeker does not appreciate the AICPA’s disapproval of the FAF’s new proposal to set up a Private Company Standards Improvement Council, calling the disapproval “a clear threat to the independence of the FAF.”

Accounting Today has the entire story but the short version is that Kroeker went off at Monday’s Standard & Poor’s Accounting Hot Topics Conference in New York, calling the AICPA’s resolution “egregious.”

In case you forgot, at last month’s fall meeting of AICPA Governing Council, members overwhelmingly approved a resolution that sent the Financial Accounting Foundation (FAF) a strong message: either FAF moves to adopt the Blue Ribbon Panel on Standard Setting for Private Companies’ (the Panel) recommendations for a separate board— which is the AICPA’s preference— or the AICPA will consider other options.

At that time, the AICPA made it clear that if FAF continued to pursue its current proposal, the AICPA board of directors would look at other solutions for addressing the needs of private companies. This could include creating a separate standard setting body to develop private company generally accepted accounting principles (PCGAAP) or a comprehensive private company-specific basis of accounting that would deliver meaningful, lasting improvement to private company financial reporting consistent with the Panel’s recommendations.

Maybe Kroeker should go hang with the AICPA and cuddle up to watch the upcoming webcasts that outline FAF’s proposal?

We’re not sure why Kroeker is so butthurt, nor why he would dare take on 350,000 CPAs by calling their wishes “egregious” but that’s a different matter entirely.

News

Turns Out I Wasn’t the Only One Under 40 at AICPA Governing Council After All

by Adrienne Gonzalez

When I wrote Why Am I the Only Person Under 40 at AICPA Spring Council? last week, I knew that my tongue-in-cheek exaggeration would get people talking, which was mostly the point of saying something like that. As I think we all know, whenever someone implies that the profession is still represented mostly by middle-aged men in suits, everyone gets worked into a lather. My goal wasn’t to offend said middle-aged men in suits, most of whom I admire for their leadership, but to bring the issue of under-representation of the younger demographic to the table for discussion.

I didn’t actually believe I was the only one under 40 there (creative license people, dealtand that there is a hierarchy that young CPAs have to work their way up, starting on the state level. As a reporter, I had to do exactly the same, first covering MACPA’s CPA Day in Annapolis to get a feel for how visits with legislators work before being sent to cover Council. Cruising through the Maryland State House was a lot like attacking the Hill except on a smaller scale, and certainly prepared me for what to expect at Council.

As it turns out, I really wasn’t the only one under 40 there (as suspected). Evidenced by the following email I received from a young Washington State CPA shortly after Council wrapped:

Hi Adrienne,

I’m sorry I missed you! Thank you for your article. I am 2 years fresh out of college (work for an international firm), and was fortunate enough to be sponsored by the Washington (State) Society of CPAs to attend the AICPA governing council. I had a chance to meet with my representative, another representative’s office and my senator’s office today to discuss these issues with them and/or their staff. Tomorrow I’ll be meeting with the other senator from my state. The state society had the same view as you, in that it is important to start including accountants of my generation in the advocacy role, because these issues that are being introduced today will transform the profession for years, potentially decades, to come. The AICPA Governing Council has exposed me to numerous leaders in the accounting profession that serve as a great resource for the younger crowd to learn from. All it takes is the interest of young CPAs to become involved. It’s important now more than ever to have young CPAs step up to the challenge. Thank you for urging all young CPAs to contact their state society or nearest member on the governing council for more information.

“I found that for whatever reason, most state societies use their Council seats as ‘rewards’ for their (usually senior–both in experience and often age) members–so the ‘free’ attendance that Council members receive are not generally available to people our age. So I don’t blame most of the young CPAs, since without this free ticket, I wouldn’t be able to afford to attend this meeting either,” said Donny Shimamoto, CPA, CITP, founder and director of IntrapriseTechKnowlogies and the only young CPA we were able to track down at Council. Does that tell me that the system is rigged to keep middle-aged men in suits at the top of the food chain? No, it tells me that perks like comped trips to DC for Council are earned through demonstrated leadership, which is a commitment of both time and energy toward advancing the greater good of the profession.

As I said last week, if you are interested in legislative issues and want to get involved, you can start by contacting your state society of CPAs and checking out the AICPA Leadership Academy, which will be meeting in October in Durham, NC.

Here’s the bottom line: no one is going to approach you and ask if you want a free trip to our nation’s capital just because you have a pretty face (sorry, Joe Carey). You can position yourself as a leader by staying on top of important legislation that impacts the profession and even if you couldn’t make it to Council, there’s nothing keeping you from writing your Congressmen to share your feelings on this year’s key issues.

Tax

This Year’s AICPA Council Issues Are (Mostly) All About Taxes

by Adrienne Gonzalez

Let’s all keep in mind here that the repeal of burdensome 1099 rules buried in the Affordable Care Act of 2010 (or “Obamacare” for my fellow right-wing nutjobs out there) can be directly traced to efforts by the AICPA and its members, including a few angry letters sent by the AICPA to Congress. It’s a perfect example of legislative action at work, for those of you out there with little faith in the process.

Here are this year’s key issues:

Tax Strategy Patents S 139 The Equal Access of 2011
The bill would stop the granting of patents for tax strategies. Which basically means your next door cube-dweller won’t be able to patent his favorite spreadsheet.

Tax Due Dates S 845 Tax Return Due Date Simplification and Modernization Act of 2011
This bill would amend the Internal Revenue Code of 1986 to provide for the logical flow of return information between partnerships, corporations, trusts, estates, and individuals to better enable each party to submit timely, accurate returns and reduce the need for extended and amended returns, to provide for modified due dates by regulation, and to conform the automatic corporate extension period to longstanding regulatory rule. The short version: it seeks to change the dates on which tax returns are due to a more sensible pattern.

Simplification of the tax code
The AICPA has a long history of advocating sound tax policy; this year, it’s all about simplifying the tax code, starting with the repeal of AMT and consolidating education provisions.

Workforce Mobility HR 1864 Mobile Workforce State Income Tax Simplification Act of 2011
Unlike previous mobility initiatives, this one would limit the authority of states to tax certain income of employees in other states. Thanks to the Internet, many companies are able to staff employees around the country, some of which only do a few hours of work a month. That means the company must register and withhold state taxes for these employees in each state.

“Our tax laws are a vital component of the economic health of our nation as evidenced by the discussion in Washington about tax reform,” Barry Melancon, president and CEO of the AICPA, said. “We think it’s important for members of Congress to talk taxes with CPAs as they consider changes to the law. CPAs can provide objective advice, based on real-world experience.”

The goal of Congressional visits is to exchange information with our Congressional members on legislative issues of concern to CPAs (and, directly related to CPAs’ concerns, those of their clients) and to garner support for the profession’s position on these issues, as well as to position CPAs as resources and thought leaders. To call it lobbying would be a misnomer as lobbying would imply a one-way relationship, beneficial only to the special interest doing the lobbying. So don’t even go there; we’re talking about providing professional analysis, opinion and expertise in exchange for a voice in legislation that could potentially impact hundreds of thousands of CPAs and CPA firms around the country.

For the CPAs on the Hill yesterday, they not only presented their issues but offered themselves as experts in areas many Congressional offices are unfamiliar with. Tweaking the tax code is a delicate issue, and one that shouldn’t be approached without expert analysis of any proposed legislation. This is where the two-way street comes in, and another reason why these visits are important for all involved parties.

We’ll update later with specifics on the day we spent meeting Maryland Congressional members with the MACPA Council and Executive Committee, including former MACPA Chair and amazing storyteller Larry Kamanitz, who made 60 cents an hour when he first got into public. Stay tuned!

News

Why Am I the Only Person Under 40 at AICPA Spring Council?

by Adrienne Gonzalez

So I’m here in downtown Washington, D.C. for three days of awesomeness that is AICPA Spring Council 2011. While today’s session started just past the asscrack of dawn (breakfast at 7am) and goes through evening, the first day was mostly cocktails and schmoozing, as these events tend to  be.

Here’s my question: where the hell are the young CPAs? Of the attendees, every single state is represented, some more than others. CPAs from across the country have descended upon Washington in their best monkey suit to listen to speakers like George Will and Eleanor Clift, as well as to get an update on the legislative issues that impact the profession. On Tuesday, they’ll be taking to the Hill to bring these issues directly to their Congress(wo)men.

But there is only ONE attendee (from Hawaii) who falls into our age bracket (your humble reporter excluded, of course). ONE.

Listen, I get it. You spent your last college years dealing with this kind of shit, putting on a tie and sucking up to partners and recruiters, all the movers and shakers of the industry. You worried about using the wrong fork at banquets and sat through symbolic awards ceremonies just to appear as though you are passionate about your industry. Now that you actually have a job, what’s the point?

The point is that these issues impact the profession which you will inherit one day. I’ve got nothing against middle-aged men in suits (hell, I’ve been dating one for the last two years) but one day soon, they’ll be retired and it will be up to us to take the reins and move the profession forward. How on Earth are we supposed to do that if we don’t figure out how it is done now?

There are endless opportunities here for mentoring and, better, for young CPAs to have a voice. Yes it’s somewhat symbolic. Yes you will have to wear a tie. Yes it can be stuffy and dull and a bit tedious. Guess what? It’s still important and one day, when all the middle-aged men are living their retirements out on yachts in the middle of the Pacific, you’re going to have to step up and do it anyway.

If you’d like to get involved (it’s not too late to start planning for next year), get in touch with your state society of CPAs for more information. You can find out more about AICPA Governing Council on their website.

You can follow #AICPAGC11 hashtag on Twitter to check out what we’re all up to for the next two days and please, don’t make me yell at you again. I didn’t put this monkey suit on this morning for nothing.