Accounting News Roundup: Chief Accountant ‘Cautiously Optimistic’ on Convergence; Grant Thornton Auditors Barred by PCAOB; PwC’s front row seat at AIG, Goldman Dispute | 02.19.10

James L. Kroeker [Web CPA]
The Chief Accountant sat down for a Q&A with Web CPA to talk about the Tiger Woods press conference, the upcoming Oscars, and how his own “situation” is far more impressive than anything you’ve seen on Jersey Shore.

Actually, no he didn’t. He talked about what you’d expect him to talk about including the so-called SEC roadmap that we’ve been wondering about:

We’ve been turning our focus back to the proposed roadmap. The staff has spent innumerable hours over the late summer, throughout the fall, and now the beginning of this year turning our attentiomment letters. It’s not that the volume of comment letters is extraordinary, but the depth of thought is particularly impressive

So in other words, those of you that took the time to write the letters, it’s your fault the Commission is so far behind. Sounds to us like your 50 page, single-space masterpieces aren’t exactly breezy reading. But don’t worry, they’re muscling through.

When asked about the June 2011 convergence “deadline”, Kroeker said that he was “cautiously optimistic” that the FASB and IASB will get the lion share of the work done even though the IASB has been sending mixed signals lately. At least someone is confident.


PCAOB Disciplines Grant Thornton Auditors [Compliance Week]
The PCAOB layed the smackdown on two Grant Thornton auditors this week for not questioning some the accounting policies of Imergent, Inc., a Salt Lake City tech company.

Partner Ray O. Westguard and manager Jennifer Nakao, were barred from practicing public company audit work for two years and one year respectively for their lack of auditorness.

According to the PCAOB, the two failed to question the revenue recognition policies and the allowance for doubtful accounts of Imergent, despite the fact that these two issues were addressed by the concurring review partner. Regardless of those concerns, the issues eventually led to an SEC investigation, the restatement of the financial statements for FY ’03 and ’04 and the firing of GT as the auditor. Maybe Grant Thornton should just avoid Salt Lake City clients altogether.

A Prisoner’s Dilemma: AIG and Goldman Sachs Game Each Other And PwC [re:The Auditors]
Our contributor Francine McKenna describes PwC’s front row seat for the negotiations between AIG and Goldman Sachs while the two were attempting to sort out their differences:

Why did PwC decide to point the finger at AIG? Neither AIG nor Goldman Sachs had been willing to defect or betray each other thus far, per the prisoner’s dilemma, even to save them both. The dispute had been going on for more than a month, more than a quarter, more than a year. It may have been excusable for PwC to allow a mismatch in valuation on the same assets in two of their clients for a month or a quarter due to timing differences in access to information. But a serious, contentious mismatch for more than a year, through several 10Q’s, and now going on two 10K’s?

The rest over at RTA.

James L. Kroeker [Web CPA]
The Chief Accountant sat down for a Q&A with Web CPA to talk about the Tiger Woods press conference, the upcoming Oscars, and how his own “situation” is far more impressive than anything you’ve seen on Jersey Shore.

Actually, no he didn’t. He talked about what you’d expect him to talk about including the so-called SEC roadmap that we’ve been wondering about:

We’ve been turning our focus back to the proposed roadmap. The staff has spent innumerable hours over the late summer, throughout the fall, and now the beginning of this year turning our attention to the 200-plus comment letters. It’s not that the volume of comment letters is extraordinary, but the depth of thought is particularly impressive

So in other words, those of you that took the time to write the letters, it’s your fault the Commission is so far behind. Sounds to us like your 50 page, single-space masterpieces aren’t exactly breezy reading. But don’t worry, they’re muscling through.

When asked about the June 2011 convergence “deadline”, Kroeker said that he was “cautiously optimistic” that the FASB and IASB will get the lion share of the work done even though the IASB has been sending mixed signals lately. At least someone is confident.


PCAOB Disciplines Grant Thornton Auditors [Compliance Week]
The PCAOB layed the smackdown on two Grant Thornton auditors this week for not questioning some the accounting policies of Imergent, Inc., a Salt Lake City tech company.

Partner Ray O. Westguard and manager Jennifer Nakao, were barred from practicing public company audit work for two years and one year respectively for their lack of auditorness.

According to the PCAOB, the two failed to question the revenue recognition policies and the allowance for doubtful accounts of Imergent, despite the fact that these two issues were addressed by the concurring review partner. Regardless of those concerns, the issues eventually led to an SEC investigation, the restatement of the financial statements for FY ’03 and ’04 and the firing of GT as the auditor. Maybe Grant Thornton should just avoid Salt Lake City clients altogether.

A Prisoner’s Dilemma: AIG and Goldman Sachs Game Each Other And PwC [re:The Auditors]
Our contributor Francine McKenna describes PwC’s front row seat for the negotiations between AIG and Goldman Sachs while the two were attempting to sort out their differences:

Why did PwC decide to point the finger at AIG? Neither AIG nor Goldman Sachs had been willing to defect or betray each other thus far, per the prisoner’s dilemma, even to save them both. The dispute had been going on for more than a month, more than a quarter, more than a year. It may have been excusable for PwC to allow a mismatch in valuation on the same assets in two of their clients for a month or a quarter due to timing differences in access to information. But a serious, contentious mismatch for more than a year, through several 10Q’s, and now going on two 10K’s?

The rest over at RTA.

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