This is the story that never ends

Nicolas Cage Must Not Have Heard About the Fiscal Crisis in California

We really thought we had heard the last of Nicolas Cage and his tax problems. The man has eight films at various points in production including the next editions of both the National Treasure and Ghost Rider franchises.

With that kind of cinematic lineup, you’d think the State of California would give him the thumbs up and say, “Oh, it’s cool Nic. Just cut us a check as soon as you have the cash. NO worries.”


Then we remembered that this is California, home to the budget projection experts that misfired on their tax revenues by $3 billion, so you bet your repossessed-mansion ass they’ll take that $3.8 mil.

National Treasure’ actor Nicolas Cage owes another $3.8 million [Tax Watchdog]

SEC Votes to String this IFRS Thing Along

AS PREDICTED. And It was unanimous. Sure, it wasn’t the boldest call we’ve ever made here at GC but we thought it was worth pointing out that the SEC really didn’t have much of a choice.

The good news is that the Commission doesn’t need to sweat this for now. They’re just letting everyone know that they’re tepidly re-re-committing to International Financial Reporting Standards but ONLY if the IASB and FASB can pull off meaningful convergence and the IASB stops being a bunch of lily-livered bean counters and tells the pols to BTFO.


Web CPA reports, “In the commission’s vote Wednesday, the SEC reiterated its cautious support for IFRS, contingent upon reaching a number of milestones, including convergence of U.S. GAAP with IFRS and improved governance of the International Accounting Standards Board.”

And even if that happens, the SEC staff has to check everything out so that everyone knows exactly what will result from the U.S. adopting IFRS (probably the rapture). Once that’s settled then we can talk about how this will get done.

Mary Schapiro’s words:

“In 2011, upon conclusion of the fact-gathering and analysis set forth in the work plan – and assuming completion of the convergence projects – the commission will then be in a position to determine whether to incorporate IFRS into the financial reporting system for U.S. public companies. Until that time, we will expect staff to provide periodic written public reports to the commission on the progress of its efforts.”

Back to work everybody. There are future meetings to be planned.

SEC Votes on Work Plan for Incorporating IFRS [Web CPA]
Earlier: SEC Meeting on Roadmap Will Likely Lead to More Meetings on Roadmap

SEC Meeting on Roadmap Will Likely Lead to More Meetings on Roadmap

We hope! Remember how James Kroeker said how the Commission was “turning our focus back to the proposed roadmap”? No? Well, he did. And apparently he was serious because the SEC is having a meeting tomorrow about said roadmap. The whole time we’ve been reading about this map to godknowswhere, we just figured it was a figment of our imagination.

But a meeting! A meeting to decide whether or not the SEC will publish a statement! That’s somewhat encouraging, isn’t it? Here’s exactly what’s on the docket for the Sunshine Act Meeting:

“The Commission will consider whether to publish a statement regarding its continued support for a single-set of high-quality globally accepted accounting standards and its ongoing consideration of incorporating International Financial Reporting Standards into the financial reporting system for U.S. issuers.”


Okay, so if we’re reading this right, this particular sit-down will be to decide whether or not the Commission will put out an official statement regarding global accounting standards and if IFRS is good enough for us here in the US of A. Since everyone seems to be doubting the SEC’s ability to play nice with the rest of the world on the whole issue, they figured a hippie-ish sounding meeting should help calm everybody down.

We can only foresee two outcomes from this meeting: 1) the SEC decides that they will publish a statement (after more meetings) and give an approximate date that the statement will be released and it will be delayed for an indeterminable amount of time, or 2) the Commission decides it will not publish a statement that the IASB can take its self-righteous double-entry accounting attitude back to London-town and we’ll just do whatever the hell we want. THE END.

SEC to Meet Wednesday on IFRS Roadmap [Web CPA]
SEC considers reaffirming commitment to global standards [Accountancy Age]

Nicolas Cage’s Catastrophic Financial Situation May be Coming to End

God willing friends, this may mark the end of the financial tragedy that has plagued our hero for we’renotsurehowlong.

It only took putting homes from every continent, both poles, and a bungalow on the moon all on the market. He got sued by his ex-girlfiend, his former business manager and had more liens slapped on his ass than MC Hammer.

But NC is going to pay $14 million to the Service and he’s free and clear. Done. No more troubles. He’s confident this time. You know why? Because he told People about it:

While the government recently placed a tax lien on his real-estate holdings, including an additional $6.7 million from 2008, “over the course of my career I have paid at least $70 million in taxes, unfortunately, due to a recent legal situation, another approximate $14 million is owed to the IRS,” Cage tells PEOPLE in an exclusive statement. “However, I am under new business management and am happy to say that I am current for 2009, all taxes will be paid including any to be determined state taxes.”

$84 million is all it took friends and now that’s he’s got new business management, nothing like this will ever happen again. Plus, the next edition of the National Treasure franchise appears unstoppable. BACK. IN. THE. GAME.
[via the TaxProf]

Happy (Belated) First Anniversary Satyam Fraud!

One.jpgTechnically it was last week but dang, it’s been a helluva year for Satyam and PwC.
Two auditors in jail, the PwC Chairman resigned, Jim Quigely couldn’t wait to tell everyone that Deloitte was the new auditor and P. Dubs would really, really be stoked if everyone just forgot the whole thing ever happened.
Despite the non-existent coverage in the U.S., our contributor Francine McKenna has covered this story from the beginning so we got her thoughts:

What do we know about the scandal one year later – its causes and how to prevent similar frauds in the future? Not much. The experts we should look to for answers, Satyam’s auditors Price Waterhouse India, are accused of being complicit and are still in jail. Who’s guarding the guardians? We’ll have to wait for the shareholders’ lawsuits and the SEC here in the US to hear what really happened, who all benefitted, and who is ultimately responsible.

Judging by the pace of things, we’re guessing the lawsuits won’t be resolved in our lifetime. While we are around however, we’ll keep you updated on what does happen whether it’s reasonable requests from PwC to jailhouse brawls (please God).

Chairman of PwC India Steps Down, Wants Time to ‘Look at Other Things’

Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for pwclogo.thumbnail.jpgThis is the latest development in the Satyscam that P. Dubs hasn’t been able to wish away.
Ramesh Rajan still had a ways to go in his current four year term as the India Chair which might suggest that someone told Ram that his services were no longer needed:

Rajan, who was at the helm of affairs when the Satyam scam broke early this year, had about one-and-a-half years remaining of his four-year tenure as the chairman of PricewaterhouseCoopers India network of entities (PwC India). When contacted, he refused to divulge exact reasons behind his sudden exit, and said he wanted time to “look at other things” within the firm and “allow someone else to take charge of the operations.”

Gosh, that’s a little mysterio. Apparently he was having such a good time that he wanted someone else to experience the fun? Okay then. The new lucky duck is Gautam Banerjee, and he is coming over from Singapore pronto to take the wheel.
We’re confident he’ll do a bang-up job but we’ll take this opportunity to remind him that he’s still got some auditors in jail and a lot of pissed investors that want PwC to pony up. Probably should get crackin’.
Satyam effect? Chairman of PwC India steps down [Times of India]

Ernst & Young Is Thankful for Lawyers, Possibly Toblerones

Thumbnail image for madoff-sentenced.jpgJust when we think the Madoff beat has quieted down, we’re reminded that the tentacles of the Ponzi scheme of our lifetime reach far and wide and for that we are thankful.


Not because we enjoy the carnage that has come about from this particular scheme. No, that would be in bad taste. We’re mostly thankful because we’re certain that today, 90% of you will spend the entire day gabbing about turkey-lurkey-do instead of sending us details on your firm’s cost saving initiative du jour, thus making it a slow news day.
So, thank you Berns, for providing us a story on this most non-productive day of the year:

Private and institutional investors who lost money through Access International Advisors LLC’s LuxAlpha Sicav-American Selection are suing UBS and Ernst & Young for “seriously neglecting” their supervisory duties of the fund. A Luxembourg court will decide in hearings that started today whether investors have the right to bring direct claims against the fund’s custodian and auditor.
“These cases are very important,” Pierre Reuter, who represents clients in six of the lawsuits being reviewed over four days of hearings, said by telephone before the hearing. “They could set the course for some 100 pending cases and many more to come.”

Since these are simply “test cases” the plaintiffs will be anxious to see the results, especially since the Swiss are involved. A pallet of Toblerones will certainly find their way to the offering table at some point. Whether UBS allows E&Y to squeeze in on this valuable bargaining chip remains to be seen.
UBS, Ernst & Young Face Test Cases Over Madoff Funds [Bloomberg]

Madoff Auditor Pleads Guilty, Solidifies ‘Worst Auditor Ever’ Status

That’s not an official title but if you’ve got suggestions for someone else, please, enlighten us.


Reuters:

He told the court that he did not conduct any independent auditing or verification of financial statements or tax returns provided by Madoff and “others” at Bernard L. Madoff Investment Securities LLC in New York.

Friehling did not state who the ‘others’ were but the U.S. Attorney hinted that we’ll get to know sometime. For now, Friehling is a free man, out on $2.5 million bond until his sentencing which is tentatively set for February.

He faces up to 114 years in prison but similar to Madoff’s chief bald-faced liar, Frank DiPascali, his cooperation should result in a lighter sentence. And by lighter we’re guessing that means he’ll still leave prison horizontally.

Madoff Accountant Pleads Guilty [WSJ]