November 13, 2018

Accounting News Roundup: PCAOB Fines Deloitte; PwC’s New Tax Team; Dueling 8-Ks | 05.25.18

Plus, Lynne Doughtie’s favorite movies, Samsonite’s troubles, stolen crypto, and bad mussels.

PCAOB fines Deloitte $500,000 for faulty audits of Jack Henry [AT, PCAOB]
Jack Henry sounds like someone’s pipe-smoking, whiskey-sipping grandpa, but in this case, it’s a Missouri-based provider of information processing solutions for banks and credit unions, and Deloitte did a lousy job auditing them. Namely:

The PCAOB found that Deloitte was primarily responsible for the violations because none of the engagement personnel it assigned to the audits had sufficient software industry experience and knowledge (including of the relevant generally accepted accounting principles) to properly evaluate and audit the accounting for software license revenue.

This happened over three years of audits. The order notes that Deloitte did find “a number of audit and accounting issues” after it had been notified that the Jack Henry fiscal year 2014 audit would be inspected. Deloitte reported these issues to the PCAOB before its inspection began. So, hey, great job not altering workpapers, Deloitte. Few seem to have that kind of willpower.

PwC announces plan for hundreds of new Connecticut jobs [SA]
The firm is planning to add 400 jobs in Stamford, and if you enjoy public officials gushing over big business, then this article is for you. Anyway, Stamford will be the home of PwC’s “Insourced Solutions for Tax team.” That’s the group that was created out of the deal that saw PwC hire General Electric’s tax department last year.

A Most Unusual Way To Impress KPMG CEO Lynne Doughtie At Your Job Interview [Forbes]
Ugh, yet another interview I’ve read for you. This one isn’t as bad as the “raise-your-hand” nonsense if only because we learn that Lynne Doughtie’s favorite movies include Air Force One, Armageddon, The Help, and The Blind Side.

Samsonite tumbles after short seller questions accounting [Bloomberg]
Blue Orca Capital claims “Samsonite concealed slowing growth with debt-funded acquisitions and inflated profit margins with dubious accounting linked to its takeovers.” Blue Orca also alleges that there are some dodgy related party transactions between Samsonite CEO Ramesh Tainwala and companies controlled by him and his family, as well as  “a revolving door of auditors” in the company’s South Asia business.

Blood Cleaning Company’s Ousted CEO Denies Exit in Filing Faceoff [Bloomberg]
Dueling 8-Ks have caused Rockwell Medical Inc. to have, what Bloomberg’s Matt Levine describes as “different, let’s say, metaphysical statuses.” One 8-K says the CEO has been fired. Another 8-K says that’s not the case. Sounds confusing, right? That’s because it is:

At 9:27 p.m. on Tuesday RMTI-B’s 8-K, announcing that Chioini is still the CEO, arrived at Edgar; at 6:05 a.m. on Wednesday, RMTI-A’s 8-K, announcing that no he isn’t, arrived. Because late-evening Edgar filings don’t actually become public until the next day, the two filings ended up hitting the Bloomberg terminal news feed five minutes apart on Wednesday morning.

Previously, on Going Concern…

I  wrote a farewell post.

In Open Items, WHY CAN’T WE FIX REGULATION?

In other news:

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Accounting News Roundup | 01.21.10

How to find the “best and brightest” [CPA Success]
This may be a better topic for the friendly HR professional but figuring out who these future accounting rock stars are before they show up on their first day is “more art than science”, as Tom Hood notes.
Popular to some old-school thought, GPA does not always indicate who’s going to dominate in the real world and “soft skills” — besides being a terrible term — are in more demand than ever.
Help The The American Red Cross of Greater Chicago Help Haiti [Re: The Auditors]
The American Red Cross of Greater Chicago is having a drive today and since Francine’s friend is the CFO, we’ll be glad pass around the news:

One of my oldest and dearest friends, Guillermo Becerra, is the CFO of the American Red Cross of Greater Chicago. I asked him how I could help him, and the Red Cross, during what must be an incredibly busy time post-Haiti earthquake.


“The Chicagoland community will come together on Thursday, January 21 to give to the American Red Cross as we help the people of Haiti recover from the catastrophic earthquake that devastated their country last week.
The Chicago Helps Haiti media relief drive begins at 5 a.m. and lasts until 11 p.m. Nearly every TV and radio station in our area will be promoting this fundraising effort throughout the day. You can help too, by giving via phone or online, and sharing your thoughts here, on Facebook or Twitter, and by asking others to give.
To give from 5 a.m. to 11 p.m. CALL 1 (877) 565-5000 or visit www.chicagoredcross.org/haiti

Plus, we’re guessing that if you give, your 2009 tax return isn’t much of a concern.
If Your Password Is 123456, Just Make It HackMe [NYT]
The Times is concerned that you have a shitty password which puts you at a huge risk of being hacked by someone sitting in their parents’ basement.

Imperva found that nearly 1 percent of the 32 million people it studied had used “123456” as a password. The second-most-popular password was “12345.” Others in the top 20 included “qwerty,” “abc123” and “princess.”

You know who you are, ye with stupid passwords. Also, don’t even think of changing it to “654321” because that drops in at #19.

Accounting News Roundup: Haiti Relief Passes Senate; Accounting Job Surge? CPAs Basically Control People’s Lives | 01.22.10

Senate votes for faster tax breaks for Haiti gifts [WaPo]
As expected, the U.S. Senate unanimously passed legislation yesterday that allows taxpayers to deduct donations made for Haiti relief efforts. You have until the end of February to donate so that it may be included on your 2009 return.

Maybe it’s bad legislation but we’ve been over that.

CPA Jobs Set for Surge. But When? [CPA Trendlines]
That’s the question, isn’t it? Rick Telberg, who has done a great job of tracking the Bureau of Labor Statistics on accountants, points out that while the latest BLS forecasts a 22% increase (279,400 jobs) by 2018, there’s no indication that it’s happening now:

[M]any tax, accounting and finance professionals are still slogging through the Great Recession. The Association for Financial Professionals, for instance, reported that about one in four respondents say their organizations will contract in 2010. At the same time, a PricewaterhouseCoopers survey of private companies found 43 percent of CEOs and CFOs still budgeting no expansion over the next 12 months to 18 months. The data just seem to reinforce economic uncertainties and a weak outlook.


The BLS is looking past the past the recession for the jump in opportunities but just when the hell will that be? Just because the economy isn’t contracting currently, doesn’t mean it won’t in the future and this “recovery” has been tepid at best.

Theismann to CPAs: You Are the Conscience of America [Web CPA]
Joe Theismann gets it. He knows that without all of you out there in CPA land, your clients don’t stand a chance. They’d be finished. Finished!

“You’re the conscience of America,” Theismann told conference-goers. “You are the survivors in tough times. With accountants, I’m not looking for someone to file taxes and do my financials. I can do that myself online. In your position you can basically control people’s lives.”

So get out there and control somebody’s life. Joe Theismann is expecting it.