Audit

Securities and Exchange Commission Chairman Mary Schapiro has been under pressure not to appoint a leading critic of International Financial Reporting Standards as a permanent chief accountant, according to a former official who filled that post.

Are you able to get what you need from reviewing financial statements? Do you think there are ways to enhance the usefulness of the presentation of the information?

The International Auditing and Assurance Standards Board has completed a project aimed at updating and clearing up ambiguities in auditing standards.

The American Institute of CPAs has appointed four new members of the Auditing Standards Board.

The town of Fairfield, Conn., has filed a lawsuit against KPMG and an investment advisor after its employee retirement programs lost an estimated $40 million in two hedge funds that invested all their assets with Bernard Madoff.

Berkshire Hathaway chairman Warren Buffett said in his annual letter to shareholders that he endorses mark-to-market accounting, even though it helped produce the worst financial results for his company in the 44 years he has been running it.

Although admittedly many people look upon January 1st as the trigger-point for resolutions, an organization known as Savvy Ladies figures that April 15th is really the better date. “Tax time is often the only time of the year when a lot of people sit down and look at how much they’ve earned and how much they’ve been able to save,” says Stacy Francis, founder of Savvy Ladies and a certified financial planner,. “It’s a bit of a shock for many to see how much cash slips through their fingers every month.” Savvy Ladies is dedicated to providing financial education to women in their quest for financial independence. It has free monthly newsletters, seminars, and teleconferences that are pegged at fostering a sense of community and are specifically designed to educate, amuse, and fulfill savvy women who want to take control of their financial future. There are currently 2,100 members and growing rapidly. The founder of this organization is Stacy Francis who is the president of Francis Financial, a New York City-based firm that specializes in helping individuals create more fulfilling lives through financial freedom.

Rep. Paul Kanjorski, D-Pa., has introduced a bill in Congress to close a legal loophole that allowed Bernard Madoff’s tiny auditing firm to avoid scrutiny.

The Public Company Accounting Oversight Board’s chief auditor and director of professional standards, Thomas Ray, has resigned and plans to return to the private sector on March 6.

CaseWare IDEA and Audimation Services plan to introduce the latest version of their IDEA audit software, including a new project overview feature that presents a graphical representation of the entire audit or investigation process.

Children with investment income may have part or all of this income taxed at their parent’s tax rate rather than at the child’s rate, according to the IRS.

Ric Rosario is stepping into some big shoes at Camico Mutual Insurance Co.

Bankers could start huffing and puffing after a few minutes on the treadmill once Tim Geithner cranks up the dial a few notches.

As the 111th Congress grapples with tax legislation and other issues of concern to CPAs, more than a few House and Senate leaders are likely be feeling a deeper appreciation for the accounting profession.At least that's what political fundraisers for the profession are hoping for after contributing a record $5.5 million dollars to support congressional candidates during the 2008 election campaign.

The American Institute of CPAs’ board of directors has extended Barry Melancon’s term as president and CEO for another five years.

From my vantage point on the other side of the Atlantic, I was delighted to see the Securities and Exchange Commission publish its roadmap to adoption of International Financial Reporting Standards. I just hope the U.S. constituents are as pleased as I am and that we can make some real progress towards global accounting standards.With that hope in my heart, I thought it would be worthwhile exploring what the situation might be post-IFRS-adoption for U.S. GAAP, for the Financial Accounting Standards Board and for the International Accounting Standards Board, drawing on my experience of what has happened in the U.K. and Europe.

Page 330 of our 2002 book, Quality Financial Reporting, includes this comment: "No one should accuse accountants of being glacial; after all, glaciers move."Contrary to our jab, the accounting glacier did actually move in May 2008 when FASB issued Staff Position APB 14-1, ponderously titled Accounting for Convertible Debt Instruments That May Be Settled in Cash Upon Conversion (Including Partial Cash Settlement). This FSP is something of a sleeper because no one's said much about it, even though it kicked in for fiscal years and first quarters beginning after Dec. 15, 2008.

As the debate over adoption of International Financial Reporting Standards heats up in the U.S., KPMG has released a survey indicating support for IFRS among investors, analysts and corporate executives who prepare financial statements.

Despite tightening their wallets, Americans are now further from achieving their retirement goals amidst the weakening economy. That’s the word from Bank of America in its new 2008 Retirement Savings Survey which says that a growing number of Americans are concerned that the current economic crisis is threatening to leave them further behind on their retirement plans. This survey finds that 60 percent of Americans are spending less than they were three months ago as a result of the current economic climate and more than half (51 percent) of the general public and 40 percent of affluent Americans are also saving less than they were, also three months ago; in fact, one in five say it is “much less.” Although the majority of respondents (69 percent) with at least one retirement account say that they have not withdrawn assets from their account(s) prematurely, recent economic conditions have caused 18 percent to withdraw assets prematurely. The leading reasons for these early withdrawals are near-term financial obligations, such as credit card debt (26 percent), and mortgage payments (22 percent), with an additional 22 percent citing recent job loss. Keep in mind that these numbers may increase significantly if the economy worsens because many more people will be dipping into their retirement savings and that could have profound implications for the country’s economic well-being. Moreover, this study shows that many Americans now (a nice 43 percent) believe they face more years in the work force than they expected just a year ago. By the same token, 36 percent of affluent respondents said that the current economic conditions have pushed back their own expected retirement age. The survey also confirms what many of us in the financial planning area already suspected: Americans need better guidance and education regarding how best to plan for retirement and manage their retirement assets. Actually, 59 percent of the general public and 52 percent of affluent Americans don’t know or don’t even have a good idea of how much they’ll need to save in order to maintain their current standard of living in retirement. That’s where the financial planner can enter. Taking it a step further, the findings point out that 47 percent of retired Americans currently do not believe or are unsure if their retirement assets will cover their financial needs throughout their lifetime. And, they are already retired. That’s frightening! So, the bottom line on this latter subject is that many individuals may not be receiving the financial guidance necessary to fully realize the opportunities that retirement presents. Need I say more?

The National Association of State Boards of Accountancy is urging the Securities and Exchange Commission to withdraw its proposed roadmap for transitioning to International Financial Reporting Standards.