DON'T FIX PEER REVIEW - IT AIN'T BROKEAlthough I find some comments I can agree with in recent opinion articles by Lou Grumet ("Rethinking the 'peer' in peer review," Sept. 26-Oct. 9, 2005, page 6) and Eli Mason ("Quality review and its future vs. peer review and its failure," Oct. 24-Nov. 6, 2005, page 6), I am writing to say, peer review ain't broke - don't fix it, especially if the fix means turning the program over to the government at any level. That will fix (kill) it, for sure.
I have been involved in the program since it has been in existence, as a peer reviewer, state committee member and chair, three years on the AICPA Peer Review Board, and as a state technical reviewer. Over the years, I have seen the accounting and auditing practices of small firms, including my own, improve very much in quality as a direct result of peer review.
I have also seen many examples where firms that did not "rotate" reviewers received modified or adverse reviews when previous reviews were unmodified. That issue was much debated and resolved, I believe correctly, during my term on the PRB. Also, when I was on the PRB, I opposed the change from "Quality Review" to "Peer Review," but I was outvoted. I still think I was right, agreeing with Mr. Mason on this point.
However, I have also seen many other changes over the years that have improved the program. It's not a perfect program, but continuing to fine-tune a good program is the way to go. I believe that imposing standards on small firms similar to what was done with public firms just empowers bureaucracies to the harm of the public and the profession. I do not believe many "thinking CPAs" share Mr. Mason's assessment or conclusions.
I applaud my peers for making the peer review process successful! I prefer to trust you over some "enlightened" bureaucrat. Carry on!
Howard H. Anderson, CPA
Scottsville, Va.
UNFAIR TO BUSH AND THE FEDS
I thought that Glenn Cheney's article ("FASB: Katrina not 'extraordinary;' AICPA offers some guidance," Oct. 10-23, 2005, page 46) in which he took a "shot" at President Bush, was clearly a "cheap shot," and completely unfair and uncalled for.
According to press reports, many, many people much closer to New Orleans, and with much more of a direct responsibility, had considerable knowledge about the levees, and the storm that was approaching, than our governmental organization in Washington, D.C.
Responding in kind, I suggest that you've hired "another snot-nosed kid" somewhat educated at some liberal college, with a 2.5 grade-point average who couldn't get a job with a responsible organization.
Maybe your editors should read - and edit - the material such people write.
David M. Ebner
david_ebner@sbcglobal.net
It was with bereaved amusement that this writer read CPA Gary Konecky's political diatribe against the Bush administration and a Republican Congress thinly disguised as a condemnation for allegedly placing the vote with respect to the estate tax ahead of those parties suiting up and heading to New Orleans to personally rescue the destitute and plug the leaks in the infrastructure (Konecky's throw-away barbs at Democrats notwithstanding) ("Lawmakers' deadly priorities," Oct. 10-23, 2005, page 6).
The bereavement arises from the fact that Accounting Today has apparently now been co-opted by angry liberals for essentially political argument. Certainly nothing essential to the accounting, tax, financial planning or technology segments of the larger profession was mentioned in the article.
The amusement arises from the fact that Accounting Today is so uninformed that it would publish a diatribe so factually incorrect - well, perhaps "factually incoherent" is a better term. Anyone who has legitimately and seriously followed the news with respect to Hurricane Katrina is well aware that a confluence of events - inspired in large part by miscommunications from the local governments of New Orleans and Louisiana - contributed heavily to a delayed federal response. And this included the limitations imposed on the federal government with regard to usurping local and state authority over their own jurisdictions.
It is also arguable that more than enough money was available to Louisiana to improve the levee protection in New Orleans, but that the Louisiana congressional delegation and state and local politicians chose to use the funds for a variety of other purposes - the congressional delegation included, by the way, a member of the Black Caucus. Moreover, any project to secure the city in a Category 5 storm would take many, many years - far beyond 2005, even if the project had been undertaken years and years ago.
Konecky is apparently oblivious to the fact that a project that was undertaken in the 1970s might have preserved much of the washed-out area of New Orleans had it been completed. But, of course, that undertaking was delayed indefinitely by lawsuits initiated by the "environmentalists." After blocking the project as planned, the Army Corps of Engineers threw in the towel and abandoned the plan rather than engage in endless litigation.
Finally, the mainstream media - despite its anti-Bush, anti-Republican, anti-military leanings - has essentially conceded that the deployment of National Guard troops in Iraq was not a significant contributing factor to the lack of National Guard involvement (or manpower needs) in New Orleans. The Louisiana National Guard did not deploy and there were many of them available.
It might also be noted that the "secondary" responders wisely pulled men and material out of harm's way when Katrina's approach pattern was imminent. Mr. Konecky is apparently not familiar with the fact that one does not generally deploy troops underneath a bombing run. It takes time to redeploy in such cases. That is one of the reasons why FEMA has historically not been a first responder and is not structured to operate as one.
Mistakes were made and there is surely plenty of blame to go around. One of those mistakes was Konecky's use of the pages of Accounting Today to launch an ill-informed political rant with little if anything to do with our learned profession. Another was Accounting Today's decision to publish his rant.
Kip Dellinger, CPA
Los Angeles, Calif.
SUPPORT FOR CYNTHIA PAGE
Kudos to Cynthia Page for her truthful and well-written response ("Middle-aged, creative and proud of it!" Oct. 24-Nov. 6, 2005, page 6) to Ron Baker's "Old dogs don't create new tricks" (Sept. 26-Oct. 9, 2005, page 33). Myths abound about age; a serious publication like Accounting Today cannot afford to perpetuate them.
Congratulations to Cynthia for earning her CPA in her mid-50s! I recently obtained an MBA and an MSA, graduating just shy of my 50th birthday. I expect to complete the remaining requirements for my Connecticut CPA license within the year. For me, middle age has been a time of freedom, exploding creativity and joy. I now realize that life is supposed to get better as you get older, but I had to discover that for myself. Hopefully, as the young adults of today reach their mid to later years, this truth will be self-evident.
Carol Elizabeth Dubs
Norwalk, Connecticut
cedubs@optonline.net
Congratulations to Cynthia Page on being a new CPA and doing it at nearing 57.
I certainly agree with her on the ageist article.
Because of my given names, Bertie Jean (Bertie was my mother's name - they were expecting a girl, and in those days they could not tell until I got here, nearly 79 years ago), I have often been thought to be a female. In fact, for years, I was invited to join the American Association of Women CPAs. They would not let me when they found out I was a male.
I am still a practicing CPA. Some have said that I should stop "practicing" and go to work. I just thought it would be a horrible waste to have learned all I knew and not continue to use it as long as I could. My age had nothing to do with it. I have the perfect state of "retirement" - I simply changed gears.
By the way, I learned that Bertie is a revered Irish name for a male when the European Union admitted the Republic of Ireland with a fellow named Bertie as their prime minister. I have known for years that Jean is French for John. My father always told me we were French, Irish, Dutch and "Pole Cat" in our extraction.
B. J. Chenault, CPA
Lubbock, Texas.
PARAKEETS, NOT VULTURES
The cartoon in Accounting Today (Oct. 24-Nov. 6, 2005, page 6) was an attention-getter. The image of the carcass of KPMG being circled by three Internal Revenue Service vultures overstated things a bit. Given that the IRS has a dwindling budget, low morale and serious leadership problems, the cartoon should have depicted KPMG being circled by IRS parakeets.
Our country has a $300 billion tax gap with no realistic plan in place to deal with the problem. IRS vultures? I think not.
Mike Peacher
National vice president
National Treasury Employees Union
Dolton, Ill.
THERE'S MONEY FOR M&A
I am writing in regard to your article, "A mergers and acquisition checklist for firms" (Oct. 24-Nov. 6, 2005, page 24).
I agree with the author regarding the criteria that firms look at when either acquiring or being acquired. I also agree that mergers are no way to fix problems in your firm.
However, I disagreed with the assertion that there is little or no cash available. That may be true when dealing with large firms, but down in the trenches I can assure you there is money available for acquisitions.
For sellers of practices grossing less than $1,500,000, we consistently see 50 percent or more of the purchase money up front. Above $1,500,000, it all depends upon location and whether the buyer or the seller is more motivated.
Do not let small practice sellers believe they have to take the lion's share of the risk in these transactions. There are excellent financing sources available to buyers to help with a down-payment. If a buyer wants the seller to take all the risk on an earn-out-type transaction - the seller should tell them to take a hike and call in the experts.
John R. Ezell, CPA
President
ProHorizons
