Audit

The American Institute of CPAs outlined plans to simplify the plethora of auditing standards and eliminate any that had no clear objective.

CPAs spend many hours studying accounting and tax rules and become very knowledgeable, with CPE insuring that they are fully conversant with any changes. In the very large firms, the training and education offered has a very interesting mix, as a good deal of it doesn’t deal with technical knowledge but on the softer skills that can actually contribute more to the success of the individual and the firm. This is readily apparent in the structured way mentoring is conducted in these larger firms. Mentors are trained, mentoring processes and procedures are established, the details of the mentoring program are communicated, and staff members participate in a prescribed manner. And why do larger firms spend so much time and money on mentoring? They see the success in the performance of those who complete the program, and are very happy with the ROI. Because of the limited resources of small firms, ROI on spending is extremely important and gets very close scrutiny. The problem is, in new areas like mentoring small firms, because of their lack of familiarity, often overspend and don’t get a good ROI. Small firms therefore need to be creative. I recently came across Mentoring Process for CPA/CAs--Third Edition, by Rex Gatto, that can be helpful in that regard. There is a roadmap to creating structured processes quickly, tools and tips for mentors, and advice for mentees on getting the most from mentoring. The book doesn’t pull any punches, such as when it is pointed out that the mentees’ best role is that of the listener, and warns mentors not to be sidetracked by the mentee who is an analyzer (overanalyzes facts), a whiner (complainer), a rejecter (not me!), a victim (poor me!) or a controller (talks too much). Equally important, the book tells mentees what they should look for when selecting a mentor. “When choosing a mentor, a mentor should be someone:

KPMG is donating $250,000 to the nonprofit organization First Book to distribute more than 200,000 books this year to needy children.

The preliminary report of the U.S. Treasury Committee on the Auditing Profession was released in March.It’s a well-prepared wish list of how to improve the auditing profession. Unfortunately, the report envisions solutions that have little or no chance of being instituted any time soon.

AICPA REVISES PEER REVIEWThe American Institute of CPAs has issued revised standards for performing and reporting on peer reviews, along with interpretations of those standards.

We’re not sure if we’re having another epiphany, or merely looking at the world a little bit differently, but we have some thoughts on an area of accounting practice and theory that we’d like to share with you.Specifically, we’re looking deeper at the worthiness of comparability as a goal for financial reporting information. As we described in a recent column questioning the wisdom of merging all standard-setting authority in one body, it has been traditionally assumed that useful information helps users compare competing investment opportunities. Think of this notion of comparability as Company A and Company B balanced on a seesaw, suggesting that the investor’s decision is between buying one company’s stock or the other’s.

Ernst & Young is developing a curriculum to help accounting students learn about International Financial Reporting Standards.

A White House memo directing agencies to finalize their rules before the fall election could have an impact on plans for the use of Extensible Business Reporting Language and International Financial Reporting Standards in filings with the Securities and Exchange Commission.

The financial advisor of the future must go beyond today's conventional wisdom to favor a more complete risk management framework that better recognizes the retirement income needs of millions of retirees, says The Retirement Income Industry Association (RIIA), a national, not-for-profit organization whose members are defining the future of retirement security in the United States. RIIA's chairman and executive director Francois Gadenne, points out that the association has already developed a job description for financial advisors that he believes is more relevant to the practical challenges that retirees are now beginning to confront. "In order to be effective in the future, financial advisors seeking to provide the best possible results for their clients must embrace a host of new responsibilities and personal professional skills. And, based on feedback that financial advisors have brought to RIIA, they are concerned about helping investors plan, implement, and manage their retirement to achieve and maintain a desired standard of living over the long term. That's a complex task which calls for new insight and education." The association’s director, David Macchia, explains that the advisor's job description has expanded significantly. "The advisor must have the skills to not only help investors accumulate financial capital--such as savings, investments, insurance, annuities, and IRAs--but also to understand the changing roles of financial capital combined with human capital (wages and earnings) and social capital (social security, support from family or friends, defined benefit plans) as investors address their retirement income security needs." RIIA says foresees a new dimension of professional advisor education that will be called for in light of the shifting challenges confronting retirees. To support advisors in maintaining a high degree of proficiency in retirement income planning, including specialized professional education that provides the skills and insights needed in the years ahead, RIIA is developing a Retirement Income Management Body of Knowledge. This curriculum, it notes, will match specific learning objectives with practice management skills derived from a Retirement Management Professional job description and leading to a Retirement Management Analyst™ (RMA) designation. Elvin Turner, its director, asserts that the association’s expanding body of knowledge is the key to addressing financial advisors' concerns about delivering comprehensive retirement income planning to their clients. "Ethics and practice management skills are foundational elements of RIIA's body of knowledge. The reason is to help RMA designation candidates sharpen their ethical behavior and practice skills needed to address retirement needs in an effective and objective fashion." According to Gadenne, the ability to identify the vital attributes of tomorrow's successful financial advisors is attributable to what he feels is the association’s unique perspective in the financial services industry. "RIIA and its members have been able to view across silos by pulling down barriers between product and process, manufacturer and distributor, academic and business, to achieve a needs-based perspective that would otherwise not be possible. It is this perspective that is driving the definition of prudent retirement planning, including the skill set that advisors must maintain and refine over time." For more information, visit www.riia-usa.org.

Richard Vitale, co-founder of accounting firm Vitale Caturano, resigned after allegations emerged that he assisted ticket brokers with getting favorable legislation passed in Massachusetts without first registering as a lobbyist.

Deloitte has formed an International Financial Reporting Standards University Consortium to help bring IFRS into more college classrooms.

The Internal Revenue Service has published the 2009 inflation-adjusted deduction limits for health savings accounts.

The Securities and Exchange Commission voted at an open meeting to propose that companies begin filing financial statements in an interactive tagged format as early as next year.

Nearly 75 percent of CFOs and senior comptrollers have no experience using International Financial Reporting Standards, while 55 percent are unfamiliar with the Extensible Business Reporting Language, according to a new survey by Grant Thornton.

With convergence to a single set of global accounting rules an inevitability as opposed to a possibility, it’s up to standards setters and regulators to put forth guidelines that are not only the best that can be written, but also ones that shed unnecessary complexity.

The Securities and Exchange Commission is expected to announced a proposed rule Wednesday mandating the filing of SEC reports in Extensible Business Reporting Language format.

Accounting firm Moss Adams has named Rebecca Pomering CEO of its wealth management division.

The Treasury Department's Advisory Committee on the Auditing Profession on May 5 issued a draft of its final report. It is broken down into a number of sections, each with detailed recommendations with regard to auditing and the auditing profession.

If you haven’t heard by now, there’s a big conference coming up in July. It’s being billed as “How CPAs Can Make Money in Financial Planning” and it’s being held on July 20-22 at the Chicago Fairmont. Why this conference? Because the Baby Boomers, as we all know, are hitting retirement age with the Barely Boomers right behind, and they are certainly looking for financial planners to advise them. In the interests of full disclosure, the conference is being offered by the premier publications in this field: CPA Wealth Provider, Accounting Today, and Practical Accountant. The conference will detail exactly what it takes to be really successful in such a practice area, which includes estate, tax, retirement, insurance, and succession planning and, of course, wealth management. This breakthrough conference is also targeted at those firms not yet in financial planning as well as those who have not been successful. In fact, the conference will allow you to determine how deeply your firm should be in this growth area and in what capacity. You will also learn how to select the right strategic partner and how to get financial planning up-to-speed quickly. Moreover, you will hear success stories from financial planners and learn the challenges of those CPAs who entered the business without the proper training, analysis, and understanding and therefore, failed or had a number of false starts. Incidentally, the conference will offer 16-18 CPE credits. Most importantly, a number of the preeminent people in the field will be conducting sessions at this conference including the keynote speaker, Stuart Kessler, considered by many as the “Godfather” of financial planning and including, as of this date, Garrett D'Alessandro, Sidney Blum, Mitchell Freedman, Peter Jaworski, Rebecca Pomering, Larry Swedroe, Enrique Vasquez, Troy Waugh, and Clare Wherley. For more information, contact Julie.Dienes@sourcemedia.com.

Sage Software's U.K.-based parent company, the Sage Group, reported revenue of $1.29 billion for the half-year ended March 31, 2008, a 9 percent increase over the same period last year.