The whole Enron/Global Crossing/Who's Next accounting scandal has caught the public's imagination. Certainly, it points to a need for accounting reform. All of us can envision our 401(k)s sinking in the sunset. To help the public and the profession understand the new terminology and concepts that are emerging, I want to present a guide to the new phrases and concepts you'll need to understand the origins of the current crisis and how the profession is responding.
Bob Scott's New World of Accounting Glossary.
Lauditor. An accountant whose job is to praise the client, not check the underlying accounting.
Plaudit. A financial report issued by a Lauditor.
Lauditing. A quality of crime life performed by a Lauditor. Usually banned as in "No lauditing, ball playing, spitting, or open fires."
Cognitor. A Lauditor who is out of work in several different countries.
Independent Accountant: Somebody who doesn't work for the Big Five.
Multi-disciplinary firm. An organization in which accountants get to boss lawyers around.
Global Credential: A passport
Cooking the Books. A generally accepted accounting principle.
Double-entry Accounting. Two sets of books.
Ongoing Concern. Did the client's check clear?
Prepared in conformity with GAAP. We added the numbers the company gave us.
Golden Parachute. A financial incentive often given to top executives to encourage mismanagement and torpedoing the company's future.
Professional Self-Regulation. We didn't learn anything from the savings and loan mess. Why do you expect us to learn anything from Enron?
AI--CPA. A new Steven Spielberg film about an artificial boy who yearns to grow up to be a Cognitor. A tragedy starring Haley Jo Osmant. "I see botched audits."
Web Assurance Program. A joint AICPA/department of agriculture initiative in which inspectors check between the toes of waterfowl to make sure they can swim.
WebDuck. A new Web Assurance program from the AICPA and international accounting associations.
A Big Bill. The only tangible result of a WebDuck Audit.
But why just deal with new concepts and definitions. Enron has given us a whole new arena of laughs-accounting humor. The profession wants you know that accountants are fun people who can take a joke, no matter how much money you've lost. Here are some modest examples.
Infomercial-meister Ron Popiel is introducing the "Pacioli Home Rotisserie." He figures Pacioli is spinning so rapidly in his grave, it's a great name for a product that cooks chicken in 20 minutes.
I hear the Miss America Pageant is so upset by the auditing scandals it is going to put the accountants in bathing suits and let the contestants count the ballots.
You've heard of Old Navy Fleece Jackets. The company is preparing a new line of "Accounting Fleece" jackets. There's only one size, but they will cover up anything.
Have you tried the new Enron diet? Stay on it for a week and your brokerage account is suddenly lighter.
An accountant, a lawyer, and an Enron executive walk into a bar. The lawyer tells the accountant not to say anything and the Enron executive takes the fifths. (Think about it.)
Jerry Falwell is organizing an association of fundamentalist Christian Accountants. They look at a company's books and pray for the right answer.
My daughter is confused by all this auditing talk. She thought the accounting principal's office is where business people are sent when they are bad.
I hear Playboy cancelled its "Girls of the Big Five" feature. The magazine figured the profession is already over-exposed.
-Robert W. Scott
