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Tag: beefs

Thanks to the IRS, Republican Presidential Candidate Herman Cain Only Made Enough Money to ‘Buy New Golf Clubs and Move to Atlanta’

Soon-to-be failed Presidential candidate Herman Cain is best known for being the former CEO of Godfather’s Pizza. When he took the job in 1986, the Journal reports “Mr. Cain cut costs and closed unprofitable locations and said that he returned the business to profitability in just 14 months.” An impressive feat to be sure and he continued to sling pie as the CEO until 1996 when he presumably figured he could cash in nicely.

Unfortch for Cain things didn’t really work out. And whose fault would that be? The IRS, of course!

Mr. Cain said that in 1996 he struck a deal to sell his stake in Godfather’s to his partners. That’s when the IRS showed up and commenced an audit of his tax return for the year 1994, coincidentally the year he publicly challenged President Clinton on the impact of his health-care reform plan. Simultaneous audits of Godfather’s and Mr. Cain’s partners were quickly concluded, but Mr. Cain said that the audit of his personal finances dragged on until 1999.

When he finally concluded the sale of his Godfather’s stake, Mr. Cain said that its value had fallen by 75% and yielded only enough money for him to “buy new golf clubs and move to Atlanta.” As for the IRS, they claimed he owed $1.8 million in back taxes, but he said that as soon as he appealed this decision, they immediately dropped the claim and asked only for $40,000 to cover interest on “the money I didn’t owe.” Outraged, he nevertheless paid the bill to resolve the matter. He said that such treatment at the hands of the IRS happens all the time.

Godfather vs. Tax Man [WSJ]

BDO Is Not Impressed with KPMG’s Business Tactics in Brazil

BDO announced a new member firm in Brazil today because…well, KPMG kindasorta poached their last one. Well, BDO Global CEO Jeremy Newman has had it up to here (i.e. eye-level) and wanted to point out that A) this not uncommon:

“BDO is not the first firm to have suffered as a result of our larger competitors using their dominant financial position to buy market share and we have expressed our concerns about this in BDO’s recent submission to the European Commission’s Green Paper on the role of the audit profession,” said Newman.

B) this is some shady dealings:

“These tactics are not driven by client needs but by one firm’s wish to buy market share and presumably achieve further economies of scale. We are concerned that when one firm looks to dominate it reduces choice for clients and leaves the market worryingly dependent on just a few players.

and C) these aren’t just fightin’ words. The most interesting accounting firm in the world will be taking action:

“BDO will be lodging an objection to this deal with the Brazilian competition authorities.”

Challenge extended.

BDO lines up complaint against KPMG Brazil [Accountancy Age]