November 15, 2018

Accounting News Roundup: Revenue Recognition and Exxon’s Emission Costs | 06.05.17

revenue recognition exxon emissions

New revenue recognition rules

The new revenue recognition rules go into effect later this year, so everyone is working like mad to get ready for it. Unfortunately, the Wall Street Journal reports that not everyone is going to be ready, which means people’s lives are terrible now. The story cites an EY study that found that “More than a fifth” wouldn’t be ready by the end of the year deadline and would have to rely on “manual workarounds” at the outset

Maybe I’m wrong, but I can’t think of a better way to get artificial intelligence skeptics to reconsider how they feel about the technology than a massive accounting rule change that requires an even more massive technology overhaul. This just sounds awful:

“It starts as an accounting exercise and ends up as an IT project,” said Tony Skiadas, controller for the New-York based company. “It uses up a lot of resources and puts pressure on the team.”

Verizon began the work three years ago, he said. He wouldn’t reveal how much the effort has cost, but employees have already spent thousands of work hours on the project. As the finance staff determined how the accounting needed to change, Verizon’s software programmers wrote new code to transcribe information from the contracts to the financials.

“Doing it all on a spreadsheet is not tenable,” said Mr. Skiadas.

I mean, obviously. But having a computer read a new accounting rule and then asking it to reprogram all the systems based on that accounting rule wouldn’t only be tenable, it’d be ideal! It wouldn’t even ask to take a break. Then you could focus all your time on finding those accountants and programmers other things to do with their time. They’ll likely be bored.

Exxon’s emission costs

One idea for keeping all those accountants and programmers busy would be to help ExxonMobil figure out how to account for all their emission costs. The New York Attorney General isn’t convinced that the company knows what it’s doing or is trying to pull a fast one:

[A]ccording to court filings by the New York State attorney general’s office, there is new evidence that the company has not actually followed that course, potentially overstating the value of its assets and defrauding its shareholders.

According to the filings, made by the state on Friday, “evidence suggests not only that Exxon’s public statements about its risk management practices were false and misleading, but also that Exxon may still be in the midst of perpetrating an ongoing fraudulent scheme on investors and the public.”

It boils down to whether or not Exxon’s unextracted assets are worth as much as they say they are. The company has been using a “proxy-cost of carbon” which “may be a sham” according to one of the AG’s reports.

But if you go back to my original thought — It makes sense for accountants whose jobs are going to be automated to find jobs that aren’t going to be automated. GAAP for emissions, as an example, isn’t really a thing yet, so it’s conceivable that quite a few people could work on that awhile. Unless the machines start writing the accounting rules and implementing them into the software. If that ever happens, then we’ll have to think harder about how to spend our working hours.

Previously, on Going Concern…

I wrote about the new PwC partner class that the firm announced on Friday.

In other news:

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Image: David Ooms /Wikimedia Commons

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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.