Tag: Technology

Three Important Filing Tips for Luddites

There is an immense body of law governing whether last-minute tax filings are timely. So often a cheap little postmark is all that stands between a taxpayer and tax catastrophe. With the IRS herding preparers and taxpayers towards e-filing, timely-mailed, timely-filed cases may seem like an arcane body of law, like piracy cases, but paper filing still has some proud hard-core holdouts, and sometimes only a paper filing will do. At the Tax Court, for example, where the website says “Initial filings, such as the petition, may be filed only in paper form.”

The tax law says that a tax return is considered timely-filed if it is mailed on the due date, but the shift to e-filing can make things awkward for paper filers. For example, few post offices still offer late April 15 hours for last-minute paper filers. Stepping into the last-minute filer void are authorized private carriers of tax documents, like FedEx and UPS. A proper shipping document by an authorized private carrier can document timely filing. That gives taxpayers new ways to meet disaster, as the Tax Court illustrated this week.


A California couple wanting to take the IRS to Tax Court had a July 20, 2009 deadline for filing their petition. They filed by FedEx, perhaps at a FedEx/Kinkos location. They generated a shipping label on their home computer with a July 20 date. But FedEx spoiled everything, as the Tax Court explains:

The petition, which was sent by FedEx Express (FedEx), was received and filed by the Court on Thursday, July 23, 2009. The envelope containing the petition bore two shipping labels. The first shipping label, which had been placed inside a clear plastic pouch adhered to the envelope, had been electronically generated by the sender using FedEx Ship Manager (customer generated label). The second shipping label, which had been affixed to the outside of the clear plastic pouch, had been electronically generated by FedEx (FedEx-generated label).

Of course the FedEx-generated label had a July 21 date. And that, says the Tax Court, is the date that counts, and our couple was out of luck.

So what does that mean to you?

• File electronically if you can. You get a nice electronic confirmation that you can beat up the IRS with, and you don’t have to worry about your valuable tax forms going awry.

• If you must paper-file, Registered Mail or Certified Mail, Return Receipt Requested, are still the best deal in town. They’ll generally be cheaper than a private carrier, and that hand-stamped certified mail postmark has the same effect on IRS agents as sunlight on Dracula.

• If you find yourself at FedEx/Kinkos late on April 15, make sure the clerk knows that you need them to stamp it before midnight. If you use private delivery, be sure to use the proper street address, as the private carriers can’t deliver to post office boxes.

Otherwise, you might find yourself trying to reach Jiffy Express.

Author of “Alan the Accountant” Wants Parents to Talk to Their Kids About Offshore Tax Havens

Last week we told you about the most important contribution to children’s literature since Mother Goose, “Alan the Accountant” (download it here).

Alan the Accountant may not be the most traditional book in the “turn the page” sense but it will no doubt get the kids thinking about double-entry at an early age and you can never get the kids started on the career path too early, amiright?

After downloading this gem and reading it a dozen times or so, we felt prepared to discuss it seriously.

We had the distinct pleasure of tossing a few questions at the book’s author, Jinky Fox, to see what sort of plans he has for Alan, how he managed to skip out on his accounting career and why it’s never too early to talk to your kids about offshore tax havens.


So you planned to become an accountant but got “sidetracked into fine art.” A couple of questions related to this: 1) By “planned” does that mean you enrolled in a class, walked in and saw the people, turned right around and walked out? 2) Does getting “sidetracked into fine art” have anything to do with a) your pursuit of a sexy art student b) drugs c) walking into the wrong classroom d) all of the above.

I started an accountancy class and walked out after a year. Not because of the nightlife which was everything I subsequently found at art school and more. Accountants definitely know how to party. Rather I hadn’t been introduced to creative accounting. Now I see those figures differently. They can tell a tale as exciting as a six volume 19th century novel or a four hour black and white Swedish epic. There is an art in the numbers.

We’re still of the opinion that there was a sexy art student. Moving on…You say “The series of books planned for Alan the Accountant will help me examine the exciting world of Accountancy that I turned my back on.” This begs a few more questions: 1) “Exciting?” 2) What have you learned about the profession that surprised you and how will you get the kids interested? 3) What makes you think the accounting profession will embrace you after you abandoned it? Accountants can be a touchy bunch, you know.

Fiction lets writers and readers live different lives. We might not be able to live the life of a 17th century nobleman, but we can read Les Trois Mousquetaires. We might not be pirates but we can read Treasure Island. I am not an accountant, but Alan allows me to explore my life had it taken a different route.

Artists rarely sit on the boards of large companies, but accountants have the keys to these exciting corridors of power. Art and accountancy might seem to be unrelated but there is an unexplored link between them. This has been expressed most famously by Andy Warhol when he said, ‘Making money is art, and working is art and good business is the best art.’

Will accountants embrace Alan? I hope so, and I don’t think that a teenage indiscretion will blight their enjoyment. And anyway, it’s not too late for me to retrain.

Well, we’re on your team and despite what some might say, that’s a decent endorsement. Anyway, getting more serious…In this book, you examine the possibilities for Alan’s happiness, which include his finding of an offshore tax haven. Is this really the example that we should be setting for children? I mean do we really want to be having the “UBS conversation” with our kids at such a young age?

Offshore tax havens are an important part of life. Is it wrong for children to learn that some kids have to say goodbye to their friends and go and live on a British dependency in the middle of nowhere? No, I say! They might be the ones ripped from their beds and flown to a sweltering island, only allowed to go home 90 days a year. Life’s not all ipods and ice cream, we have to be honest!

Have it your way but don’t come crying to us when Fox News gets ahold of this. Next – Here in the U.S., accountants are nearly as revered as they are in the UK. You guys have an awards ceremony over there for crying out loud. Do you think that your book can help bridge the prestige in the UK over the U.S.?

I hope that my little book will bring accountants to the collective bosom of the people. I see a time when Alan the Accountant is the top rated kids’ show on TV. Children of all ages will dream of becoming accountants. Our universities will be so full of accountancy students they will stop teaching all other subjects. Our shops will sell out of calculators, accountants around the globe will be lauded and admired, statues will be built of senior partners and it will all be thanks to Alan.

Honestly, the idea of a Tim Flynn statue is a tad frightening but we like your enthusiasm. Speaking of…More books featuring Alan are forthcoming – what do you have planned? Adventure? Excitement? Adjusting entries?

Accountancy is a field that has not been mined for children’s books before so there is plenty of scope for stories set in the world of high finance. Accountancy is awash with slang and acronyms that are made for children’s books. Titles planned for future editions of Alan’s book include ‘My first investment account’, ‘Adventures in negative growth’ and ‘Darling, come quickly, Freddie just said his first word – EBITDA’

Just So You’re Aware: There Is Now a Children’s Book Featuring An Accountant…For Your iPhone

No doubt that there’s many a fine accountant that wished there was a children’s book that they could read to their 0-4 year-old to demonstrate that it was an honorable and worthwhile calling.

Similarly there are many parents these days that wished for such a book that could be read without the annoyance of your skin touching paper and also the ability to check in at the local coffeehouse on Foursquare.

The wait is over.

Alan the Accountant is the first in a series of new books starring people in careers that are not usually associated with children’s books. Why should only builders and postmen find fame in children’s books?! Accountants are vital to the world economy, yet children are not encouraged to say I want to be an Accountant in the same way they learn about other careers. This book resets the balance.

[…]

As a student the author Jinky Fox planned to become an accountant, but was sidetracked into fine art. ‘The series of books planned for Alan the Accountant will help me examine the exciting world of Accountancy that I turned my back on,’ commented Jinky.

You see people? Jinky is giving back to the profession he left behind. Admirable to be sure. He’s so committed to the profession that there are plans to have Alan star in future books.

Now for you religious types, you may be disturbed by Alan sans pants but rest assured, this is a book for the whole family and the sanctity of your household is not at risk and it could do wonders for your personal financial management.

[via Accounting Tomorrow]

Accounting News Roundup: Geithner Supports Obama Tax Policy; Reznick Group Announces Principal Promotions; What’s It Cost to Be the Boss? | 08.03.10

Geithner defends Obama policy on tax cut extension [AP]
“Treasury Secretary Timothy Geithner said Tuesday it would be ‘deeply irresponsible’ for the Obama administration to support a wholesale extension of Bush era tax cuts, including breaks for the wealthy.

Geithner said in a nationally broadcast interview that President Barack Obama strongly believes those reductions should be retained for the ’95 percent’ of taxpayers with individual incomes under $200,000 a year and families below $250,000.”

Bank of America, KPMG Settlement With Countrywide Investors Wins Approval [Bloomberg]
“Bank of America Corp. and KPMG LLP’s $624 million settlement with investors in Countrywide Financial Corp. led by New York pension funds won initial court approval.

U.S. District Judge Mariana Pfaelzer in Los Angeles ruled today on the accord. A fairness hearing will be held on final approval for the settlement, first announced in May.”

Snooki Tanning-Bed Protest Splits Sin From Taxes [Bloomberg]
“[P]eople don’t like government moralizing. If there’s one thing people dislike even more than taxes, it’s being told what to do.”

So does that mean that Alabama is imploring reverse psychology?


Reznick Group Promotes Four New Principals [Business Wire]
Reznick Group promoted Dan Fox and Renee Matthews in Bethesda, MD, Eric Jones in Sacramento and Daniel Worrall in Atlanta are the big winners.

Accounting & Consulting Group acquires Roswell’s Miller & Associates [New Mexico Business Weekly]
“With 95 employees overall, Accounting & Consulting Group is now the third-largest accounting firm in the state. Headquartered in Albuquerque, it has offices in Alamogordo, Carlsbad, Clovis, Hobbs and Roswell, and has a member firm office in Lubbock, Texas. The firm specializes in audit and financial reporting, tax compliance, business consulting and trust and estate planning.”

Becoming the Boss Can Cost Plenty [WSJ]
“When starting a business on a tight budget, a single spending gaffe can spell disaster. For this reason, experts in entrepreneurship recommend taking precautions, such as doing research to identify potential hidden fees, focusing only on necessities and setting aside emergency funds.”

SAP Business ByDesign 2.5: time to invest? [AccMan]
Dennis Howlett gives the lowdown on the “general availability of SAP Business ByDesign 2.5,” which means that it is available for any to purchase. Dennis reports that starter packs for as few as ten users are available for CRM, ERP and PSP.

Why Would E&Y Download 100 Million Facebook Profiles off BitTorrent?

Good question! In case you didn’t hear, someone – his name is Ron Bowes – created a “crawler” (resident tech expert Nick told us it’s “a bot that has directives and algorithms based on known patterns in a webpage it ‘visits’ a webpage and pull information from selected places in that structure.”) that pulled data on 100 million Facebook profiles.

Since it only pulled the data that was publicly available, you could claim that this is NBD as Nick told us, “[A]ll the crawler did was collect it and put it into a single place, presumably in a format that is searchable and very ordered.”


And Engadget agrees, “There’s nothing illegal about any of this, of course — we put our information out there into the public forum that Facebook is, after all — but there’s still something creepy about the idea of someone torrenting our profile.”

What may be even more creepy is that lots of corporations – including E&Y – are downloading the data.

Nick told us that any corporation could have done this anyway but since someone else did, these companies figured, “why the hell not?” and downloaded the data. But E&Y? Maybe it’s just some back office guy stalking ex-girlfriends, as Gizmodo suggests, or Zitor collecting names for future abductions but it certainly makes you wonder.

So much so, we emailed E&Y spokesman Charlie Perkins to ask him about it (and if nothing else, we may have introduced him to a new website!) but we haven’t heard back and we don’t have our hopes up.

Major Corporations Are Downloading Those 100 Million Facebook Profiles off BitTorrent [Gizmodo]

Accounting News Roundup: BP’s Tax Break Could Bring Congressional Belly Aching; Steinbrenner’s Will Postpones Decision Estate Taxes; KPMG Foundation Awards Minority Scholars | 07.28.10

BP Seeks Tax Cut on Cleanup Costs [WSJ]
“In releasing second-quarter results Tuesday, the London-based oil giant said it was taking a pretax charge of $32 billion to cover damages, business claims an the next several years.

That total will be offset against its U.S. tax bill, resulting in a $10 billion reduction in taxes, the company said. The tax reduction will cut the company’s anticipated net spill-related losses to $22 billion, the company said.

BP paid $10.4 billion in taxes world-wide last year, according to its 2009 annual report.

Tax experts said that BP’s filing reflected standard accounting practices, even if the sums involved were unusually large.”

The Boss’ will power [NYP]
“The Boss’ will stipulates that an undisclosed portion of his estimated $1.1 billion sports, shipping and racehorse-breeding fortune will go into a trust for his widow, Joan, 74.

And it assigns Steinbrenner’s lawyer, Robert Banker, to decide whether that trust pays federal estate tax for this year, or not until after Joan Steinbrenner dies.

Although there currently is no federal estate tax for 2010, that could change if Congress acts to close the loophole and enacts such a tax retroactively, putting Steinbrenner’s estate on the hook for $500 million or more.

But under the law, Banker would have nine months from Steinbrenner’s July 13 death to decide if the estate should pay estimated estate tax for a 2010 filing — or at the rate in effect whenever Joan dies. Banker can take another six months before deciding to make that move permanent.”

LinkedIn Value Tops $2 Billion After Tiger Global Investment [Bloomberg]
“Tiger Global Management LLC, a hedge fund founded by Chase Coleman, paid $20 million for a stake in LinkedIn Corp., valuing the professional-networking website at more than $2 billion, said two people familiar with the matter.

The purchase, at $21.50 a share for about a 1 percent stake, was from existing shareholders and doesn’t represent new investment, said one of the people, who declined to be identified because the sale has not been disclosed. LinkedIn, based in Mountain View, California, is closely held.”


Sexy SAP? Surely not!! [AccMan]
SAP is known for helping HUGE companies manage all of its resources including CRM, accounting, HR, etc. etc. with enterprise solutions. There’s no chance that a huge company like this with a slew of mega corp clients could have something sleek and flexible for your small business, right? Dennis Howlett would beg to differ:

“SAP has a reputation of being big, heavy, slow and expensive. Fine for the Nestlé’s and Colgate-Palmolive’s of this world but hardly a fit for an SME business. That’s simply not true. ByDesign can be used by companies as small as 10 users. 20 users would be nice but 10 is OK. If you’re moving from say Line 50 then implementation and data transfer can be handled for less than £10K. You’re going to do a good amount of work yourself in learning how this thing works but SAP has provided plenty of guided learning material to help.”

Including a video that DH has up over at AccMan today. So simple, the editor of an accounting blog can understand it. No more excuses, people.

KPMG Foundation Awards $470,000 in Scholarships to 47 Minority Accounting Doctoral Scholars [PR Newswire]
“The KPMG Foundation [on Tuesday] announced it has awarded a total of $470,000 in scholarships to 47 minority accounting doctoral students for the 2010–2011 academic year. Of the 47 scholarships, the Foundation named 12 new recipients and renewed 35 existing awards. Each scholarship is valued at $10,000 and renewable annually for up to five years.”

IRS Demands $45 Million From Billionaire McCombs [Forbes]
Clear Channel founder and former Minnesota Vikings owner, “Red” McCombs finds himself in a similar pickle with the IRS as Phil Anschutz.

Accounting News Roundup: Geithner Is Ready to Let Tax Cuts Die; Hayward on His Way Out?; PwC Wants Glitnir Lawsuit Tossed | 07.26.10

No new recession, let tax cuts die: Geithner [Reuters]
“The economy is not likely to slip back into recession but letting tax cuts for tans expire is necessary to show commitment to cutting budget deficits, Treasury Secretary Timothy Geithner said on Sunday.

In appearances on several Sunday talk shows, Geithner said only 2 to 3 percent of Americans — those making $250,000 or more a year — will be affected when tax cuts enacted under former President George W. Bush end on schedule this year.”

BP Said to Prepare Dudley as CEO as Board Looks for Recovery [Bloomberg]
“BP Plc plans to name Robert Dudley to succeed Tony Hayward as chief executive officer as the board looks to recover the company’s position in the U.S., two people with knowledge of the matter said.

Dudley, the director of BP’s oil spill response unit, is ready to be announced as the company’s first American chief and to take the helm Oct. 1, one of the people said, asking not to be identified because a final decision hasn’t yet been made. The decision was reached in discussions with board members about how best to take BP forward and rebuild its U.S. position, the person said.”

Madoff Investors Brace for Lawsuits [WSJ]
“Irving Picard said he could wind up suing about half the estimated 2,000 individual investors he has called “net winners” from their dealings with Mr. Madoff. Such investors withdrew more from Mr. Madoff’s firm than the amount of principal they invested.

‘The people who made money, who got more, have made money at the expense of the people who didn’t,’ said Mr. Picard, who has the power under federal bankruptcy provisions to pursue money withdrawn from Bernard L. Madoff Investment Securities LLC before it collapsed in December 2008 and redistribute the funds fairly among victims.

Mr. Picard must file any so-called clawback lawsuits by December, the two-year anniversary of Mr. Madoff’s arrest and the filing of regulatory proceedings against him. ‘We’re not going to wait until the last minute,’ Mr. Picard said.”


Change the world or go home [AccMan]
Dennis Howlett implores you that if you want your firm or business to really stand out then it’s going to take more than a catchy slogan or a boilerplate email to get people’s attention. You best recognize an opportunity when you see one.

“I’ve lost count the number of times I’ve said but it is worth repeating. When disruption like SaaS comes along, it represents an opportunity. From a professional standpoint it should mean that firms can further commoditize what they do by using accounting dashboards that show them the status of their clients’ activity. It is a short step to seeing how this might be integrated into fees, billing, customer satisfaction measurement and the like.”

If You’re Going To San Francisco…AAA Will Be There [FEI Financial Reporting Blog]
Edith Orenstein has the lowdown on this year’s American Accounting Association’s (AAA) annual meeting. This year’s event is in AG’s backyard (she loves giving directions, btw) from July 31 to August 4th and will feature Francine McKenna and Professor Albrecht on one of the panels.

Join Me For a Nice Little CPA Exam Chat on August 3rd! [JDA]
Speaking of Adrienne, she’ll be over at CPA Exam Club to take your questions on everyone’s favorite test on August 3rd. Yes, that’s one week from tomorrow.

PwC Demands Dismissal of Glitnir Lawsuit [Iceland Review]
PwC’s lawyers argue that Glitnir and the firm agreed to do any legal wrangling in Iceland if the poo hit the fan. Late last week they requested that the lawsuit in New York be tossed.

Saltzman Hamma firm details merger with RubinBrown [Denver Business Journal]
“Saltzman Hamma Nelson Massaro LLP, a century-old Denver accounting firm, is merging with St. Louis-based RubinBrown LLP to form what’s expected to be among the 50 largest accounting firms in the United States, principals were set to announce on July 23.

The new entity, which will operate as RubinBrown, will employ 375 people in offices in Denver, St. Louis and Kansas City, Mo. The merger will be effective Aug. 1.”

District Court Denies Charitable Deduction for Donation of Home to Fire Department [TaxProf Blog]
Just donate a car next time. It’s a far worse investment than a house.

IRS Proposes PTIN Fees [JofA]
$50 for your very own preparer tax identification number! Of course there’s also a ‘reasonable fee’ on top of that from “a third-party vendor that will administer the application and renewal process,” that gets thrown in for good measure.

My Life as a White-Collar Criminal [White Collar Fraud]
Sam Antar went on Canadian TV last week to talk about how much fun it is to be a crook. Except the whole possibility of prison part.

Accounting News Roundup: Grassley Not Sold on Financial Reform Bill; LeBron Was Probably Considering Tax Implications; Target: Your Spreadsheets | 07.09.10

Grassley Airs Concerns As Vote Nears on Financial Bill [WSJ]
“Iowa Republican Sen. Charles Grassley is ‘very concerned’ about a provision in the financial overhaul bill designed to pay for the leaid Thursday, potentially complicating White House efforts to build a filibuster-proof majority to back the measure.

If Mr. Grassley decides to vote against the bill, Democrats would be left with little margin for error when they bring the bill to the Senate floor, which could happen as soon as next week. Mr. Grassley was one of four Republicans to support an earlier version of the bill when it narrowly passed the Senate in May.”

Number of CEOs Stepping Down is on the Rise [FBN]
It’s hard out there for a CEO. Ask Russ Smyth.

State Jock Taxes: Is LeBron Better Off in Miami? [Tax Foundation]
Of course Florida has no income tax, so every game that LBJ plays in Florida he’ll have a tax liability of $0. What about the other 41 games outside of FLA? That’s another story, “True, if James plays in Miami, none of his neighbors will be paying state income tax, but thanks to the jock tax, LeBron will.

While most people who travel in their jobs pay state income tax only to their home state, which is zero in Florida, athletes get special attention. In the NBA, each player’s per-game salary is computed, and whenever a team is on the road, the players must pay whichever tax rate is higher, the home state’s or the away state’s.”


Facebook Often Not a Job Seeker’s Friend [FINS]
If you’re pounding the pavement for a new job out there, it’s pretty much a given that people are looking at your online activity. But just how much and where? Based on the conversation between FINS’ Kyle Stock asked Michael Fertik of ReputationDefender Inc, you’d better drop those loser friends from high school that have appeared on Cops:

Kyle Stock: Can you speak briefly on to what extent companies are checking up on candidates online?

Michael Fertik: They’re absolutely doing it. It’s somewhere around 70% to 80% of hiring managers. . . And not only are they looking online, they are also looking in really remarkable places like virtual worlds and gaming rooms.

KS: To what extent do people realize this is going on?

MF: Somewhere around 70% of employers are considering online information when evaluating a candidate and only 7% of candidates believe they are doing so. There’s a huge gulf of understanding. . . Everybody has been opted in. There’s kind of a willful ignorance about it. That’s changing, but it’s still there.

And the kinds of information being considered are growing very diverse. It’s not just the photo that you published of yourself with a beer or a bong, it’s also content like who your friends are and what they post on your page and what kinds of groups that you link to. There’s kind of an associative picture that they develop of you and then they make decisions about you based on those associations.

Russian Spies Head Home in Swap Echoing Cold War [Bloomberg]
Defendant #4 and the rest of the gang are going home, making your next conference predictably more boring. Or will it???

Internal Auditors Target Spreadsheets [CFO]
“Last month the Institute of Internal Auditors plugged a gap in its guidance for members by issuing recommendations for the auditing of ‘user-developed applications,’ which generally are spreadsheets and databases developed by end users rather than by IT personnel.

User-developed applications, or UDAs, are subject to a high level of data-integrity risk because there may not be adequate controls over validating their output or making changes to them, the IIA points out. There is also confidentiality risk, because a UDA and its data typically are easy to transmit outside the company via e-mail.”

An Argument for Techie Accountants

My one piece of advice for the next generation of accountants right now is, enroll in some Computer Science courses. Learn to code. Learn how to manage a small server farm. Learn APIs, SQL, HTML5, JAVA, etc.

Drop that Poli-sci course right now.

Technicalntant’s best friend nowadays. It should be self-evident as to why. Data. Data. Data.

My first accounting gig was in a tax firm. We had an old mainframe crunching numbers and all the programming was in COBOL. In industry, reports would have all been generating output as text files; but who cares, there’s no ‘export to file’ function anyways.


Actually, that’s a good test. If you want to know whether your current software vendor is investing in the future of their product, look at the file output from your reports. If they come out as text files (you open Excel and each line of output is just one cell), this means the reporting architecture is really, really old.

It’s kind of like when you and your friends one-time go for an afternoon horseback ride. Inevitably, one person gets plunked on the beatest, tired old nag you ever seen. Yeah, technically she still rides but she ain’t even long in the tooth. All the teeth, they fell out.

Consider it the carbon dating of your accounting system.

You see, just because there has been consolidation in the ownership of companies in the enterprise software space does not mean the units have consolidated their products. Most units (purchased or raised) continue to operate independently. Revenues are generated from new sales obviously; but equally important, from a big, juicy installed base of maintenance contracts within the business units. You know that. And it’s fine. The amount of new investment in the product however, would be a corporate management decision from head office. Some products are the equivalent of that tired old nag.

Back to the point on technical skills though. Unlike back in the day, technology is no longer just auxiliary to what we do. It’s central and 100% pervasive. A commenter last week summed it up really well when I talked about the accounting tools:

“Three letters for you bitches, S to the Q to the mofo L.”

Getting a bit more techie will help you appreciate the humor in this quote. It’ll also help you recognize the tired old nag before you saddle up and ride.

In practice, normally we’re simply subject to whatever system happens to be installed. You deal with it, right? And that’s fine too. Recognition goes hand in hand with acceptance.

The reports kick out to Excel in text files; you find the delimiters, execute a ‘text-to-columns’ command, split up what you can and do your reporting. In the past, I’ve also had to occasionally create an Excel formula for pulling out text that’s really buried using the LEFT, RIGHT, functions. Then, I write a macro to automate as much as possible. Poor tired old nag.

Technology and data are just like riding a horse. With the correct instruction, you can get the horse to do what you want. But you’ll always be limited by what the horse is physically able to do.

If you don’t know anything about horses, this analogy might not make much sense at all. Which, I would say, just proves my initial point. Learn your technical skills now while you’re still in school. Leave all the fluffy horsebackriding and philosophy courses to the guys who’ll be serving you coffee after graduation.

In my view, technology skills are just as important for accountants as debits and credits. You may or may not like it, but it’s time to see how the dog food is made.

Enjoy.

Old farm adage: “If you’re going to have livestock,… you’re going to have deadstock.”

Geoff Devereux as been active in Vancouver’s technology start-up community for the past 5 years. Prior to getting lured into tech start-ups, Geoff worked in various fields including a 5 year stint in a tax accounting firm. You can see more of his posts for GC here.

Credentials for Accountants – Your Wheelbarrow Barrel Needs Tech Tools

Over the last couple months, GC has been profiling various accounting-related credentials. CPA, CFP, CMA, CIA, CFE, CVA, CFA… it’s a veritable alphabet soup of designations and employers are more and more likely to ask for a second helping these days. And you might want to pick up an MBA while you’re at it too. Y’know, in your spare time. In Canada, you can go ahead an//www.cga-canada.org/en-ca/Pages/default.aspx”>CGA, CA, and CBV to the mix as well.

Another day, another designation for yet another self-regulating body.

We’ve all heard of “grades inflation.” Well, in my view, we’re currently subject to “credentials inflation” at a rate that would make a Banana Republic cringe. In contrast, Zimbabwe Ben would likely nod in approval.


Beyond credentials though, there’s another critical piece in the employment puzzle that you would be well advised to consider as you venture into the field. Tools.

What are an accountant’s tools?

I’m not talking about the wheel barrel you’ll need to cart all those credentials to your job interview. I’m talking about the business software that more and more employers want pre-installed on their prospective employees.

At the entry level, it tends to be more of a ‘nice to have’ than a ‘must have’. But more and more, your progressive career path is affected by the type of tools you learn early in your career. There’s just no way to separate accounting and finance from the technology that facilitates accounting and finance work.

In the small business space, this is less of an issue. One small business accounting package is much like another. The “canned” reports (built in) will largely suffice, point and click. Just get yourself a healthy functional skill level with MS Excel and you’re ready to go.

Moving up into the enterprise, it’s a different story. The difference between having experience with Quickbooks versus SAP is akin to the difference between a degree from Eastern Michigan University and Princeton.

Think about that when you are venturing out into the job market for the first time. What are your aspirations? Where do you want your career to take you?

It’s difficult to blame employers for this predilection. Enterprise software is complex, subject to cryptic reporting languages, and training is expensive. The expertise is seldom institutionalized within the enterprise instead residing in the head’s of one or two key people. The “gurus.” Sometimes the expertise just walks right out the front door. It’s just way, way easier for everyone when “the new guy” can hit the ground running.

We may see this sad reality change in time.

Marc Benioff, CEO of Salesforce.com, is a key person leading the charge for change. He is an out-spoken advocate of the “consumerization” of enterprise software. In Benioff’s view, enterprise software should be as easy to use as Facebook and we’re seeing this manifest with every iteration of the Salesforce.com platform.

Unfortunately, Salesforce is the exception rather than the rule and the incumbent systems are deeply rooted in business. The technology “stack” as it’s called is built up over time and choices of enterprise systems are traditionally big, capex decisions. Change is rarely proactive and technology is normally kept well beyond the end of its useful life.

The complex enterprise systems will continue to be persistent for sometime to come. So be prepared to factor this into your career calculations. When you’re out there looking for work, ask the question of prospective employers. What systems do you use? Then, research that system to figure out its prevalence in the market: Are they using some niche software product built upon an ancient architecture? Is it a proprietary system that you’ll never see again? Is it a “legacy system”? Is it vertical specific?

Don’t underestimate the importance of these questions. No one has the bandwidth to learn all the tools currently offered. Examine your career aspirations carefully within the context of these technology tools because it can be difficult to backpedal. The tools you learn have just as much bearing on your career as the credentials you chose.

And inflation is a fact of life.

Geoff Devereux as been active in Vancouver’s technology start-up community for the past 5 years. Prior to getting lured into tech start-ups, Geoff worked in various fields including a 5 year stint in a tax accounting firm. You can see more of his posts for GC here.

Accounting News Roundup: UBS Set to Release More Names as Standoff Ends; SEC Drops Cassano Inquiry; Levin, McCain Want Stock Option Gap Closed | 06.17.10

Swiss Parliament Backs UBS Pact [WSJ]
After a short standoff in Swiss parliament, Swiss lawmakers approved the agreement with the U.S. to turn over the remaining names of UBS clients, per the agreement between the two countries. The lower house dropped the referendum proposal that would have delayed the release of the names and likely caused UBS to miss the August deadline which would have resulted in new charges against the Swiss behemoth.

The Journal reports that a Swiss government is prepared to release an additional 1,200 names following the initial 500 released last year.

Lawmakers Weigh Changes tostor Protections [Bloomberg BusinessWeek]
Congress is kicking around the possibility of an office within the SEC to respond to whistleblower complaints. Brilliant!


McGladrey Mourns the Loss of Former Partner Ray Krause
Mr Krause passed away on Monday after 40 years of service to both McGladrey and the accounting profession. He served on many professional standard setting groups including AICPA’s Accounting Standards Executive Committee, the Financial Accounting Standards Board’s Emerging Issues Task Force, and on the Financial Accounting Standards Advisory Council. H was memorialized by his friend and colleague Jay Hanson, McGladrey’s National Director of Accounting:

Ray died unexpectedly yesterday. He was on vacation in Orlando with his nine-year-old grandson doing what he loved—visiting Disney World.

Before his retirement six years ago, Ray spent more than 40 years with McGladrey. He practiced in a number of locations, including a long stop in the national office as national director of accounting. He retired as partner in 2004 but continued to work for the national office part-time in Rockford, Ill.

During his long career, he served in a number of professional standard setting groups, including the AICPA’s Accounting Standards Executive Committee, the Financial Accounting Standards Board’s Emerging Issues Task Force, and on the Financial Accounting Standards Advisory Council.

Ray is best remembered for being the consummate professional and his easy-going style. He was very well respected in the accounting profession. Comments coming in from those that knew him include: “Ray was one of the true gentlemen of the accounting profession,” and “Ray was about as fine a human being as there is.”

He was a great mentor to many colleagues in the national office. His style of giving his complete attention to whomever he was talking to, providing understandable explanations for complex topics, probing deeply for all the facts, and his uncanny ability to help draw a conclusion with full understanding will be greatly missed. Ray could convey the message to someone that they were getting to the wrong conclusion with such delicacy that you didn’t even feel it, and felt good about the answer. He knew many of the “back stories” about how and why some of the most complex accounting standards came about, which is often important to understand what they mean.

Ray will be greatly missed by his daughter, son, four grandchildren and other family and friends. McGladrey and the accounting profession have also suffered a great loss.

Inquiry Ends on Cassano, Once of AIG [WSJ]
The SEC has dropped its investigation of Joseph Cassano, the former head of AIG’s Financial Products Unit, which means he won’t face civil charges in the unit’s role in financial crisis. The SEC is also declining to pursue charges against another AIGFP executive, Andrew Forster, who was also under scrutiny.

Senator sees big reporting gap in stock options [AP]
Senator Carl “Shitty Deal” Levin and new Snooki BFF John McCain “have proposed legislation that would require that the tax deduction for stock options not exceed the expense for options reported in financial statements.”

The two are a little rankled about the $52 billion gap between the amount of stock option expenses recognized for financial reporting purposes and the expense reported for tax purposes. Guess who’s getting the short end on that one?

Bank auditors were fully involved in developing report [FT]
John Hitchens, head of the Institute of Chartered Accountants of England and Wales (ICAEW) and a PwC Partner would like to dispel any notion that auditors will resist reform after taking it on the chin for the financial crisis:

As chairman of the ICAEW working group that produced the proposals, I would like to correct this impression.

Bank auditors from the six largest audit firms were fully involved in developing the report and supportive of all its recommendations, including the proposal that banks develop summary risk statements which auditors would then give comfort over.

Feel better?

U.K. Scraps FSA in Biggest Bank Overhaul Since 1997 [Bloomberg]
Chancellor of the Exchequer George Osborne will do away with the Financial Services Authority, replacing it with three new regulatory bodies and giving most of its oversight powers to the Bank of England.

Intuit Works to Restore Online Access [WSJ]
Any individuals or small businesses that use TurboTax, Quicken and QuickBooks have been in a world of hurt as online access has been down, down, down. “Some Intuit websites were beginning to come back online late Wednesday afternoon,” according to an Intuit spokesperson. The situation is fluid.

Fannie Mae, Freddie Mac to delist from NYSE [CNN]
Meant to mention this yesterday since it was the DoD but you know how it goes. Anyway, see you another life FNM and FRE.

AICPA: CFOs Want More Input from Auditors on IT Matters

This story is republished from CFOZone, where you’ll find news, analysis and professional networking tools for finance executives.

Certified Public Accountants are increasingly being asked to solve information technology problems for clients and prospective clients, according to a survey by the American Institute of Certified Public Accountants.

But that raises a potential conflict of interest of the sort that led the Securities and Exchange Commission to keep auditing and IT consulting separate. The pressure for auditors to help provide IT solutions will persist nonetheless, says the AICPA.


“The tide has really turned this year with the economy and increasing regulations,” said Joel Lanz, co-chair of the AICPA’s Technology Initiatives task force in a prepared statement.

“As small and medium-sized companies increasingly place IT under their chief financial officers, it’s becoming much more of a broad scope of responsibility,” added Ron Box, Lanz’s co-chair.

With a renewed focus on IT-related issues, the survey makes clear that CPAs need to be literate about information technology in order to collaborate effectively with clients and their IT partners.

Data security clearly is driving the new interest, and CPAs believe the issue will persist in importance for years, the survey suggests.

The biggest surprise from the survey, Lanz told CFOZone, is the fact that “CPAs are not only providing guidance on financial issues, but there is an expectation by audit committees that CPAs could advise on different IT governance issues. CPAs are now commenting to audit committees about business operations in addition to pure financial issues.”

It’s not that CPAs are expected to be the technology expert, but the expectation is that the CPA is able to provide business insight and IT guidance which then enables their clients to effectively leverage their technology to enhance the businesses value, he added.

Is this simply recreating the problem that led to the separation post-Enron and WorldCom of audit services from consulting, much of which was IT oriented? There’s the potential for a conflict of interest here, and a slippery slope toward bad audits as result. SEC rules specifically say audit firms cannot provide IT consulting services on matters that relate to financial reporting for the same client. And the audit committee must sign off on other types of consulting services.

Lanz concedes that CPAs will have to be careful. “It is a fine line,” said Janis Parthun, senior technical manager – IT, for AICPA, but she added that CPAs can help companies avoid problem here. “Sometimes audit committees do need some education in these areas and this is where they can reach out to CPAs that have some understanding of IT to give the audit committee options to make the right decision.”

Lanz adds says that the AICPA has helped on this front with some recent guidelines. “Recent standards provide CPAs with specific criteria for when they need to communicate with audit committees, as well as the type of communication required,” he said.

A spokesman for the Securities and Exchange Commission declined to comment on the trend.