Audit

'Truth" and "accounting" should not be concepts that are terribly hard to reconcile - unless you're also trying to bring "government" into the formula.Uniting those three ideas has been Sheila Weinberg's goal ever since she had a baby. Not that the baby had anything to do with it, but motherhood gave her some time off from her career as a CPA.

IBC JETTISONS KPMGFinancial holding company International Bancshares Corp. said that its audit committee has dismissed KPMG as its auditor and replaced the Big Four firm with McGladrey & Pullen.

We are long-time critics of generally accepted accounting principles' historical cost tradition in financial reporting. We argue for providing market values to give users the up-to-date information they need to make rational investment and credit decisions.We have had some fun in the past describing the limitations in cost-based GAAP by offering other acronyms: PEAP (Politically Expedient Accounting Principles), WYWAP (Whatever You Want Accounting Principles) and POOP (Pitifully Old and Obsolete Principles). Despite the humorous undertone, our ultimate point is serious: The current financial reporting system needs to provide better support for the capital markets. After all, they are the foundation of our economy, and work best when market participants are quickly and fully informed.

Leave it to the guys from Harvard, eh? Right now, when everybody and his cat are trying to figure out what’s happening in the stock market, three entrepreneurs out of Cambridge, Mass. are gathering the best financial minds in the business to figure it all out for you. It’s called Fantasy Investing and it can be found at www.updown.com. This is a Web site launched by these Harvard Business School students. Each partner, it is said, has a significant start-up experience, and shares a common vision to revolutionize the investing world. In effect, The UpDown is a community for stock investors.

Tennessee accounting firms Petty & Landis and Lattimore Black Morgan & Cain have merged their practices, giving Nashville-based LBMC a physical presence in the Chattanooga market.

The International Auditing and Assurance Standards Board issued new requirements for auditing group financial statements.

Ernst & Young Chairman and CEO James S. Turley has been appointed chair of the governing board of the Center for Audit Quality to help improve investor confidence in the audit process.

Tax technology vendor Vertex said it planned a major hiring initiative that would double the size of its consulting group over the next six months.

Software developer Rivet Software is introducing software to convert financial reports and documents into the interactive format that the Securities and Exchange Commission has been promoting.

AICPA CEO Barry Melancon and other accounting profession luminaries have been appointed to the Treasury Department's new Advisory Committee on the Auditing Profession.

The trend toward convergence of accounting standards seems to be picking up speed after a bumpy start, but there are still plenty of hurdles ahead.

Robert Herz, chairman of the Financial Accounting Standards Board, has said he is in favor of a single set of global accounting standards.

Deloitte Consulting, Cisco Systems, SAP and the Open Compliance and Ethics Group have released a study indicating the dangers of fragmented approaches to governance, risk and compliance.

Internal auditors should begin adopting more of a risk management mindset, recommends a new report from PricewaterhouseCoopers.

M&A deals built around cash transactions involving companies with below-average price-to-earnings ratios are the most likely to increase shareholder value, according to a new study.

This past January, Jack Lynch, our director of advertising sales, and I were at a trade show and watching what has become a growing phenomenon: copies of CPA Wealth Provider were flying off the racks and tables at this show and subsequent various accounting conferences and shows around the country--more so than any other publication. We also noticed that we were getting tons of responses from readers as to how well they liked the magazine. And, I was receiving inquiries upon inquiries from the leading experts in financial planning looking to contribute articles for the magazine. By the same token, Jack was being asked about advertising in this publication because of its enormous reach into the accounting/financial planning community. Of course, all this is coupled with what has been happening today in the financial planning area and the fact that CPAs are literally flocking to financial planning especially now that the Baby Boomers are hitting retirement age. Furthermore, we realized that no one seemed to have produced a ranking of assets under management (AUM) of CPA/financial planning firms, at least not that we were aware. So, we embarked on putting together such a ranking. Keep in mind that AUM is a term originally employed by financial services companies in the mutual fund and money management or investment management business to gauge how much money they are managing. Many financial services companies used this as a measure of success and comparison against their competitors; in lieu of revenue, they had total assets under management. A survey was sent out and the response was staggering. Responses poured in. We had, of course, two criteria for consideration: They must be a CPA firm that has a financial planning practice, even as a subsidiary or affiliate, and the financial planner in the office must hold a CPA credential. In the top list are 11 firms that are in “The Billion Dollar Club” while another 41 firms are in “The $100+ Million Club.” Then there are those in the eight-figure category listed as “Rising Stars.” Not content with just a ranking, we delved beneath the surface and unearthed what affiliations each firm had, such as broker/dealers, wire-houses, financial services companies, and the like. Going even deeper, the survey reveals the financial planning products that each firm recommends in basic categories such as IRAs, 401(k)s, mutual funds, life insurance, bonds, 529 plans, to name a few. We believe the information in our charts, pie charts, graphs, and the like will shed some important light on this burgeoning field of financial planning. So then, here you are. CPA Wealth Provider, the leading national publication for CPAs involved in financial planning, is now presenting the first-ever ranking of CPA/Financial Planning firms by Assets under Management in its October issue. We expect this to be an annual event so if you didn’t turn in your survey form for this one, 2008 is right around the corner. And, if you would like a complimentary copy of the publication, just let me know.

Securities and Exchange Commission Chairman Christopher Cox said that data tags had been developed for the entire system of U.S. generally accepted accounting principles, advancing the use of the Extensible Business Reporting Language for automating financial reporting information.

The October issue of our sister publication CPA Wealth Provider has some information which will shock most. It is a ranking of CPA firms with financial planning practices by assets under management. Eleven have over one billion dollars under management. Yes, I said one billion dollars each with Plante and Moran Financial Advisors leading the pack with $5.255 billion. There are 41 firms listed with $100+ million of assets under management.

RSM McGladrey said it would consolidate four of its consulting services lines into a single organization.

Alight Planning introduced financial planning and analysis software with collaborative budgeting, forecasting and financial reporting features.