Brawl in the Nutmeg State

Unlike hockey or, for that matter, the UFC, there are, as one would imagine, few back-alley-like brawls in the accounting profession. Retaining their full complement of teeth and the contour of their profiles is not one of the bigger challenges faced by CPAs. That said, there is a bona-fide Pier 6 imbroglio taking place in Connecticut (if only figuratively) between the Governmental Accounting Standards Board and the state's comptroller. Basically the battle boils down to this: There is pending legislation before Governor M. Jodi Rell that would allow the state's comptroller to set accounting standards externally as well as internally. The bill, which has already sailed through the House and Senate, would give the comptroller authority to basically bypass GASB - the accounting standard-setting authority for municipal and state governments. Robert DeSantis, head of GASB overseer the Financial Accounting Foundation, has drafted an urgent missive to the governor imploring that she exercise her veto power. DeSantis said that the bill "threatens the integrity and objectivity of the independent standard-setting process and is a step backwards for public trust, government accountability, financial transparency and the state's investors." Joining DeSantis in the letter-writing campaign was American Institute of CPAs' president and chief executive Barry Melancon, who pointed out that should Connecticut prescribe its own standards it would add confusion not only to what standards were being used, but why Connecticut's accounting differs from 49 others. For its part, Connecticut claims that GASB's standards make it hard to achieve a balanced budget, and like other states, Connecticut requires a balanced budget. Fourteen years ago, Connecticut passed a law requiring the use of the standards issued by GASB, but has delayed implementing them due to a lack of money. Since then. the state has accrued a deficit of about $1 billion. Adopting GASB's standards would entail the state paying down that figure at a clip of roughly $150 million a year. The state's current comptroller, Nancy S. Wyman, says she has no intention of setting accounting standards for the state even if the bill is signed into law. But opponents of the measure have posited the uncomfortable question of who is to say that future comptrollers won't avail themselves of the bill's authority? Rell is expected to sign the bill. We'll see. But for now, as ring announcer Michael Buffer is fond of saying, "Let's get ready to r-u-u-u-mble!"