BLOCK TERMINATES MCGLADREY AGREEMENT
Chicago - H&R Block subsidiary RSM McGladrey has terminated its service agreement with McGladrey & Pullen, two months after M&P also moved to terminate the agreement.
In a Securities and Exchange Commission filing, RSM McGladrey said that it had delivered the notice of termination to M&P on September 15. M&P had earlier terminated the agreement in July, prompting RSM to file a lawsuit. The two firms had operated in an alternative practice structure arrangement since 1999, with M&P focused on audit and attest services, and RSM providing other types of accounting and tax services.
RSM had provided accounting, payroll, marketing and other administrative services to M&P for a management fee. The two entities also had a cost-sharing arrangement under which M&P would reimburse RSM for certain costs, mainly the use of RSM-owned or leased real estate, property and equipment.
Either party had the ability to terminate the agreement after giving 210 days' notice. According to Block's filing, "Following such a termination, M&P generally is prohibited for a period of three years from engaging in businesses in which RSM engages or soliciting RSM clients."
THOMSON REUTERS DONATES CPA2BIZ STOCK
New York - The Tax & Accounting business of Thomson Reuters has donated its entire stock holdings in the American Institute of CPAs' CPA2Biz subsidiary to the AICPA Foundation. The donation represents 8.71 percent of CPA2Biz ownership arising from a 2001 investment to help launch the portal.
The AICPA Foundation, which began in 1922, funds five minority programs, along with four accounting education programs, and a Ph.D scholarship program.
MONITORING BOARD DEFENDS INDEPENDENT STANDARDS
New York - The International Accounting Standards Committee Foundation Monitoring Board, which was established as a way to improve the governance and public accountability of the International Accounting Standards Board by providing input from government regulators, defended the need to safeguard the independence of the accounting standard-setting process in a recent statement.
"Financial standards and regulations created or modified in the midst of any crisis should be considered carefully," said the board. "This is particularly true with regard to the current review of accounting standards, because these standards play an important role in public company financial disclosures."
The monitoring board proceeded to outline a set of principles underpinning accounting standards and accounting standard-setting. The standards need to be relevant, reliable, understandable and comparable. The statement also called for independence and transparency in the standard-setting process.
GRANT THORNTON'S PARMALAT WIN
New York - Italian dairy food producer Parmalat said that it intends to appeal after a judge granted summary judgment to Grant Thornton in a lawsuit against the auditing firm for not doing enough to prevent the company's collapse.
The chief executive of the re-organized company and its Parmalat Capital unit had filed lawsuits against Grant Thornton LLP and Grant Thornton International, as well as Bank of America. However, U.S. District Judge Lewis Kaplan tossed out the lawsuits on the grounds that the parties were at equal fault.
Parmalat collapsed in 2003 and filed for bankruptcy after it admitted to having a $5 billion hole in its financial statements.
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