As I prepared to assume the editor's mantle here four years ago, I was cautioned by my former employer that "nothing" - and he emphasized nothing - "ever happens in the accounting profession," and I'd be back within six months begging for my old position. (FYI: He's still waiting.)In the four years since then, I have traditionally reserved this space in our final issue of the year to recount and reflect on the events that have impacted the profession.
In 2004, we witnessed another round of mega-fines and sanctions levied against several Big Four and national-tier firms, which only proved that there remains a pressing need to hone internal controls and corporate governance.
The Public Company Accounting Oversight Board released the results of the inspections of the Big Four firms that it conducted in 2003. Although the oversight body thanked the firms for their cooperation, glaring weaknesses emerged in many of the audits put under the microscope. The problems - such as failures to identify generally accepted accounting principles exceptions, audit documentation deficiencies, departures from PCAOB standards and violations of the firms' own internal quality control policies - probably did not come as a surprise to those who monitor the accounting profession closely.
However, PCAOB Chairman William McDonough diplomatically softened those stark results with a vote of confidence that he believed the firms were more than capable of delivering the highest quality of audits.
Both the House and the Senate passed the 600-page, $137 billion American Job Creation Act of 2004, which was signed into law by President Bush. The measure was designed to eliminate the cause of tariffs that European Union members have imposed on U.S. products since March 1, 2004. But the bill is also a lobbyist's dream, in that it has more special interest provisions than the National Press Club lounge has house accounts.
The Internal Revenue Service ended 2004 on a positive note, revealing that its enforcement activities brought in a record $43.1 billion, a 15 percent jump from the previous year after several years of declines.
We saw the resurrection of stock option expensing, a debate that seems to be brought back more often than those Friday the 13th movies. (I always wanted to know why, after the second or third Friday the 13th installment, did it not dawn on parents to stop sending their kids to that summer camp? But I digress.)
This issue also spotlights our final Top 100 installment for the year - the Top 100 Technology Products. As with our Top 100 Firms and Top 100 Most Influential People issues, our in-house staff did a Herculean job of compiling lists of potential inclusions throughout the year before we began to whittle down to the finalists. This year's theme, "Problem Solved," no doubt strikes a favorable chord with practitioners whose information technology needs have grown exponentially over the past several years.
On a personal note, our trio of accounting publications are now under new ownership, as many of you may already be aware. Our editorial mission remains unchanged, as do many of our systems and personnel. But in the coming year I think you'll see some exciting changes regarding the look and design of the publication.
As always, the staff at Accounting Today extends our best wishes for a healthy and happy holiday season.
On to 2005!
