I wasn’t gonna write anything today and I definitely wasn’t going to write up something I found on Reddit, but when I spotted this post on r/accounting, you know I just had to. I’m passionate about two things when it comes to content on this website: cats and creeper dudes who can’t keep it in […]
On Wednesday, a bunch of people stood in stupidly long lines to eat unhealthy food to demonstrate appreciation for a company whose president expressed a personal opinion about gay marriage. Some idiots took this personal opinion and extrapolated it to the employees of a company, some of whom, no doubt disagree with Chick-fil-A president Dan […]
A blind item from the front: It has come to my attention that a manager in the [redacted] office of [redacted] is leaving the firm. Her last day is officially this Friday. The two partners have asked her to come in the Saturday and Sunday after her official last day, and she has agreed. I […]
It's been quite some time since we checked in with our friends across the pond and since many of you may be dealing with client relation issues yourself, this seems like as good of an opportunity to discuss all the fun you're having. I know it's our busiest time of year and maybe that's making […]
Speaker of the House John Boehner and President Obama spoke on the phone earlier today and both men seem pretty eager to get something accomplished re: the payroll tax cut. The Hill reports that Boehner reportedly told Obama, "Let’s get this done today,” while White House spokesman Jay Carney later said, "The ball is in the […]
Everybody admires a CPA who is willing to stand up to the IRS for a client. To a point.
A New York CPA went past that point, according to the IRS Office of Professional Responsibility. If the testimony of an IRS agent before an administrative law judge is to be believed, the CPA, George Diehl, is at least guilty of a social faux pas in a conversation with IRS Revenue Officer Miamouna Diakite when she refused to put a 45-day hold on collection of a client account.
From the ALJ opinion:
Diakite stated that Diehl refused to enter into an installment agreement. Diakite testified that he became irate and loud, saying that he had obtained holds on accounts routinely, and asked to speak to Diakite’s supervisor. Diakite told him that, pursuant to IRS procedure, her supervisor would call him within 24 hours. He insisted on talking to her supervisor immediately. Diakite then, also pursuant to protocol, told him that the account was then in “collection status” whereby the IRS “will” levy against Taxpayer 1’s bank account, garnish her salary and obtain liens on her real and personal property.
Diakite testified that Diehl became very upset and said “do you know what I do to people like you. I kill them.” Diakite replied “you don’t mean that, sir” and Diehl replied “I do. I do. I’ll kill you.” Diakite then sat at her desk repeating to herself aloud that Diehl said that he would kill her and he is in New York. She became frightened and then heard a male voice, not Diehl’s, saying “what are you doing?” and the phone was then disconnected.
The opinion never does say who the “male voice” belongs to. Somebody with better manners, perhaps.
The ALJ did believe the agent:
I find that Diehl threatened Diakite. His credibility was shaken by first stating that his words to her was that you are “killing me with your stupidity and then changing that testimony to state that you are “killing me with your bullshit.”
So for all of you aspiring CPAs out there, some lessons:
• Try not to let client tax matters get to a point where you have to argue on a hold for collection.
• Don’t threaten to kill the agents. They don’t like that, and it tends to make it more difficult to get them to help your client.
•Don’t be a pottymouth. That bad language completely blew it with that nice administrative law judge.
[R]esearchers examined “agreeableness” using self-reported survey data and found that men who measured below average on agreeableness earned about 18% more—or $9,772 more annually in their sample—than nicer guys. Ruder women, meanwhile, earned about 5% or $1,828 more than their agreeable counterparts. [WSJ]
All families have individuals who seem to rub everyone the wrong way. Whether it’s that deadbeat brother-in-law who seems to owe everyone money or the bratty grandmother that threatens to cut you out of the will if you get another tattoo, there’s always someone who nobody can seem to stand. Despite these and other proclivities of your grade-A dick relatives, they’ve got some work to do to top this guy:
A 48-year-old Hilo man is going to federal prison for 17 months for duping his cousin out of $19,250 in an elaborate swindle involving a fictitious Internal Revenue Service employee in Honolulu and fake correspondence from the IRS in California and Utah.
Hua told his cousin she was being audited by the IRS and that she could pay a lower auditing fee if she hired him to do the audit rather than have the IRS do it when he knew the IRS does not charge taxpayers to audit them, according to federal court records.
At the time, Hua offered professional accounting and tax services under the business name Tri-Y Enterprises.
To persuade his cousin to continue paying him for auditing services never performed, Hua sent his cousin threatening mail and email purportedly from the IRS in Fresno, Calif., and Ogden, Utah, and from a fictitious IRS employee in Honolulu, said Tracy Hino, assistant U.S. attorney.
Hua also had his wife and daughter sign documents stating that they too were auditors working on the cousin’s tax case, Hino said.
Go hug your bitchy grandma.
Some clients treat their auditors like dirt. Given. To these haters, the financial statement audit is an onerous task that is mandated by the SEC and it amounts to an assault on liberty, capitalism and Ayn Rand’s genius. Accordingly, some clients try to push auditors around because typically they can. Today we bring you a rare example of a pushy-ass client going too far and an auditor standing up for themselves.
Ernst & Young resigned at the auditor of Life Partners Holdings Inc. in a letter dated June 6, 2011 after the CEO, Brian Pardo, WROTE IN A MEMO that he would “take action” against the firm if they did not sign off on the financial statemen t committee got wind of this little soapbox moment and promptly told E&Y about it.
From the 8-K Filing:
On June 6, 2011, Life Partners Holdings, Inc. (“we” or “Life Partners”) received a letter from Ernst & Young LLP (“Ernst & Young”) addressed to the Chairman of our Audit Committee (the “Resignation Letter”) confirming that it had resigned effective June 3, 2011, as our independent registered public accounting firm, as had been orally communicated to the Chairman of the Audit Committee on June 3, 2011. The resignation means that Ernst & Young will not certify our financial statements for the fiscal year ended February 28, 2011 (“Fiscal 2011”), which is necessary for completing and filing our Annual Report on Form 10-K for Fiscal 2011 (the “2011 Annual Report”).
The resignation follows a letter from Mr. Brian Pardo, our Chairman and CEO, to our licensee network (persons who refer purchasers to us) commenting upon the delayed filing of our 2011 Annual Report. The letter stated that it was Mr. Pardo’s position that we would “take action” against Ernst & Young if it did not promptly complete its audit and sign off on our financial statements without adjustment. Our Audit Committee wrote to Ernst & Young disclaiming the letter’s statements and asserting that the letter did not speak for the Audit Committee. Notwithstanding the Audit Committee’s disclaimer, Ernst & Young stated that the letter compromised its independence, and when considered with other recent developments, that it was no longer able to rely upon management’s representations, and that it was unwilling to be associated with the financial statements prepared by management.
Just for good measure, E&Y also stated that the company’s revenue recognition policy sucks, needs revised and they pulled their unqualified opinion over the 2010 financial statements. How’s that for “action”?
As noted by the first comment below, the second comment on a post over at Deal Journal has what appears to be the memo in question from Brian Pardo.
Message From Brian Pardo
Yesterday we filed for an extension of the time to file our annual10K which should have been filed by May 15th because the Auditors have not yet completed their part. Quite frankly I am confident that the SEC is interfering with us by trying to unnerve the Auditors (by asking frivolous questions) which has added to the delay in getting out the 10K which is done and ready to release. They are trying to force us to “restate” our revenue recognition criteria; one that has been in use for ten years now.
Restating for any period, for any reason is viewed by the market as an implicit admission that prior quarters were probably misstated, which they were not. We do expect to file shortly, but the WSJ called last night to print another negative article.
There is no reason to restate because any proposed adjustment is immaterial under GAAP guidelines. E&Y signed off on our revenue recognition criteria policy last year and every other audit firm has as well since we went public in 2000. However some of your clients will probably read about it in the WSJ or in some other supposedly legitimate news media. And, the shorts will no doubt make a big deal about it.
My position is we either ratify the 10k as is very soon or we will take action against E&Y as well as with the SEC in Washington. It is time to put an end to this nonsense! I believe E&Y is trying to mitigate problems they may have with the SEC at our expense. For instance, we were never told by E&Y that they audited at least one large organization in the Madoff matter.
We are well within GAAP boundaries regarding every of aspect of our financial statements including all materials created, used or reviewed in relation to our published financial statements. We have ten years of doing this the exact same way and every Auditor from every firm for the entire time has signed off on every single 10k over those last 10 years.
Brian D. Pardo
PS You are authorized to share my statement with concerned clients and Licensees, but, not the press although the matter is in the public domain now.
Stephen Siddell’s dishonesty led to 16 people losing their jobs while he and his wife, Louise Siddell, took luxury foreign holidays. They even posted photographs of their stay in a six bedroom villa in Cyprus on Facebook boasting, “because we’re worth it”. Liverpool Crown Court heard the couple had lock-up garage in Bromborough, which was an “Aladdin’s cave” full of their expensive furniture and designer goods. 24-year-old Louise Siddell had also used their ill-gotten gains to pay for jewellery and breast enhancement. [Wirral Globe]
Michael Grossbach is taking it out on the help.
Michael Grossbach, 32, surrendered himself to police when he learned of his impending arrest for allegedly assaulting his office assistant on March 5, police said.
“Apparently there was an argument and he lunged at her, grabbing her hand forcefully,” said Sergeant Michael Buck of Irvington Police. “There were injuries, but nothing serious.”
Sergeant Michael Foley arrested the Garrison resident for having illegal physical contact with his 31-year-old employee at his accounting firm at 106 North Broadway. The defendant was charged with assault in the third degree, a misdemeanor. According to police, if convicted he is facing anything from a fine to one year in prison.
This was sent to me by my 69-year-old landlord who is spending his winter in Florida and we humbly present it to you now for your reading pleasure during this lovely busy season.
At the end of the tax year, the IRS office sent an inspector to audit the books of a local hospital. While the IRS agent was checking the books he turned to the CFO of the hospital and said, “I notice you buy a lot of bandages. What do you do with the end of the roll when there’s too little left to be of any use?”
“Good question,” noted the CFO. “We save them up and send them back to the bandage company and every now and then they send us a free box of bandages.”
“Oh,” replied the auditor, somewhat disappointed that his unusual question had a practical answer. But on he went, in his obnoxious way. “What about all these plaster purchases? What do you do with what’s left over after setting a cast on a patient?”
“Ah, yes,” replied the CFO, realizing that the inspector was trying to trap him with an unanswerable question. “We save it and send it back to the manufacturer, and every now and then they send us a free package of plaster.”
“I see,” replied the auditor, thinking hard about how he could fluster the know-it-all CFO. “Well,” he went on, “What do you do with all the leftover foreskins from the circumcisions you perform?”
“Here, too, we do not waste,” answered the CFO. “What we do is save all the little foreskins and send them to the IRS office, and about once a year they send us a complete dick.”
The big winner in this morning’s auction of some primo seats at Texas Stadium went to Hank Wendorf of Dallas-based Ticketsource.com.
There was only one other registered bidder at the IRS auction and the total damage ended up being $311,000 which was in Wendorf’s range and he’s pretty flippin’ stoked, “These seat options are not available from the Cowboys. I think it’s a great opportunity for me to add to my inventory,” he told the Dallas Morning News and saying, “In my opinion, these are the best seats in the stadium.”
The package includes seasons tickets for this year plus options to buy the same seats – located behind the Cowboys bench near the 50 yard-line – for the next 30 years, hence, you’ll never get them.
Since the starting bid was around $180k, Wendorf wasn’t too concerned about too much competition showing up to today’s auction but at least he wasn’t smug about it, “If fans want to judge the seat quality for themselves, ‘they can buy tickets from me,’ he said with a laugh before heading off to sign lengthy legal documents.”
Prime Dallas Cowboys seats go to ticket broker for $241,000 in IRS auction [Dallas Morning News]