Madoff’s Auditor… Doesn’t Audit?!

AICPA: Madoff’s auditor claimed it didn’t do audits. Ethics probe launched.

Friehling & Horowitz, the small New York auditing firm that certified the financial statements of Bernard Madoff Investment Securities, has been telling the AICPA for 15 years that it doesn’t perform audits.

By denying it did audits, the firm avoided reviews by the AICPA. New York is one of only six states that doesn’t require accountants to be peer-reviewed. “The plain fact is that this group hasn’t submitted for peer review and appears to have done an audit,” said AICPA spokesman Bill Roberts, noting the Institute has now launched an investigation into the firm.

Because of the Madoff scandal, New York State is moving to join the ranks of peer-review states.

Posted on December 18, 2008
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SEC Officially Mandates XBRL [UPDATED]

Welcome to “The Age of Transparency.”

UPDATED: 5:50 pm to add AICPA comments

The Securities and Exchange Commission has officially adopted a rule mandating XBRL filings beginning in 2009.

With this rule, the SEC is effectively mandating that all public companies, beginning with large cap filers, submit their SEC reports in Interactive Data format, specifically in XBRL. XBRL software, an evolution of XML, the code the Internet was built upon, makes it much easier to Read more

Posted on December 17, 2008
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33 Tech Trends CPAs Need to Know

What are YOUR top tech issues?

The AICPA has released a survey, asking members to prioritize into its annual list of “Top Ten Techs” the technology issues that will have the most impact in 2009.

How many of these are you ready for… ?

Audit Process Improvement — This initiative is about auditing, process documentation, and the utilization of appropriate tools for continuous monitoring and collaborative auditing. Strategies include continuous auditing, management control systems, continuous control monitoring, and remote auditing.
Business Continuity Management and Disaster Recovery Planning — Business Continuity Management and Disaster Recovery Planning are the holistic processes organizations use to mitigate the risks to systems and people when unexpected events occur and include the maintenance of a documented plan that is periodically tested. This process includes identification, prioritization, and documentation of key systems, associated risks, and individuals responsible for ensuring the maintenance of these key systems.
Business Intelligence — Business Intelligence solutions supply information to decision makers at all levels using tools such as dashboards, Key Performance Indicators (KPIs), data warehouses, and proactive alerts. Read more

Posted on November 21, 2008
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Bob Bunting on Leadership: Four Crucial Ideas

What you need to know to make your firm more effective.

What are today’s best leadership strategies? Join the study; get the answers.

by Rick Telberg/At Large

In these treacherous and tumultuous times, the difference between winners and losers - survivors and casualties — may well hinge on the qualities of leadership.

Some firms and finance organizations are already falling by the wayside. Others are clearly gaining new and powerful competitive advantages that could last for years. Some will flourish; some will perish.

But how do you navigate this transformational era? And how do you insure your own success and survival?

We took our questions to Bob Bunting (pictured), one of the profession’s most respected authorities on leadership.
Read more

Posted on October 27, 2008
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Barry Melancon explains “the reliability project”

Maybe it’s time to scrap “independence” for comps and reviews.

In this three-minute video, AICPA President and CEO Barry Melancon (pictured) explains the Accounting and Review Services Committee’s Reliability Project. The AICPA says the project

“aims to enable CPAs to perform limited assurance engagements for clients when the external CPA performs certain control services. The accountant would still be precluded from providing any assurance service when he or she has a financial or relationship interest in the company. It is expected that current compilation and review standards will be maintained. The ARSC plans to expose a new standard in late 2008 or in the spring of 2009.”

I first reported on the trend in January, February, March and April. And you can get a comprehensive view of the issue from my August post.

So, is independence dead?

Posted on October 23, 2008
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Is it time to scrap ‘independence?’

For comps and reviews, maybe.

Who really needs or wants an “independent” accountant, anyway?

Leading accounting firms are pushing a revamp of the rules for compilations and reviews that would drop the traditional ‘independence’ requirement and replace it, instead, with a new standard aimed at reliability. The idea has been cooking for a couple years, but it’s only now starting to get some buzz in the profession.

The AICPA’s powerful Accounting and Review Services Committee is now looking at the idea, pushed there by an ad hoc Reliability Task Force of the AICPA PCPS executive committee.

Read more

Posted on August 26, 2008
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New video: Career tips for accountants

Now posted in the CPA Trendlines Videos section.

Click to see our CPA Insider Video Snack: Careers & Accounting - Four Keys to Success

Posted on August 20, 2008
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Ready, Set, Sit!

Keeping CPA exam candidates on track. What are firms doing to help? Join the survey; get the results.

by Rick Telberg/At Large

It’s too early to celebrate, but there are signs that the profession’s talent shortage may be poised to ease.

A record number of new graduates are flowing into the market, CPA firms are hiring more employees than ever and the number of CPA exam candidates is returning to historical levels. To be sure, the talent pinch remains acute and the forecast for headcount growth could yet be clouded by the economic slowdown.

But 203,000 college students are majoring in accounting today, up 19 percent from three years ago, according to the AICPA. Last year, more than 64,000 students graduated with bachelor or master’s degrees in accounting, About two-thirds of those graduates, some 43,000, went to work at public accounting firms. Many colleges and universities are churning out accounting grads as fast as they can, hobbled only by the next shortage — a shortage of instructors. Read more

Posted on August 4, 2008
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Are YOU Ready to Work at Home?

2 in 3 CPAs call it “great!”

by Rick Telberg/At Large

The dog may be barking in the yard, the kids screaming upstairs and the spouse bugging you. But, what the heck, you’re working from home and the odds are you love it.

Two thirds of CPAs who work from home-running full-time practices, side businesses or handling overflow from their office day jobs-classify the experience as “great!”

Just the same, they’re also quick to warn that not everyone is cut out to conduct business in the bosom of their families. Most of the tales that work-at-home CPAs reveal in a new CPA Trendlines study could serve as scripts for happy situation comedies, but some also have the makings of high drama. Read more

Posted on June 16, 2008
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Bill.com, AICPA Form Alliance

Web-based accounting startup teams with CPA2Biz.

Bill.com, a Software as a Service (SaaS) company that provides businesses on-demand accounts payable software, has forged a strategic alliance with the CPA2Biz unit of the AICPA.

The deal provides Bill.com with a one-stop solution to its accounting marketing and gives the AICPA the opportunity to partner with a Silicon Valley star to develop some long-sought-after projects, including a CPA “dashboard.”

For accountants, it provides a simple and innovative accounting service to gain and retain clients.

The announcement was timed for the AICPA Information Technology Conference this week in Las Vegas.

Read more

Posted on June 9, 2008
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Good News on the Staff Shortage

Is the talent crisis over?

Chart: Accounting degrees awarded - 1971-2007 (Source: AICPA)

CPAs rate their jobs. Join the survey. Get the answers.

by Rick Telberg/At Large

Having trouble finding more good accountants? If so, you are far from alone.

For Cheryl Mills, a senior manager at a CPA firm in New York City, retaining qualified staff has become an uphill battle. “We have lost 60 percent of our workforce this year,” says Mills.”The rapid turnover makes investing in staff difficult.”

Echoing that sentiment, Neil Schembre, who works at a small firm in Fanwood, N.J., says, “Staffing is the lifeblood of my business.” Read more

Posted on May 12, 2008
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CPAs Remain Negative on Economic Outlook

Some 57 percent of key AICPA members are pessimistic or very pessimistic about the economic outlook for the U.S. over the next 12 months.

That’s relatively unchanged from 59 percent who held negative expectations in the first quarter. The survey found just under 12 percent of CPAs in executive positions expressed optimism about the economy, virtually unchanged from 11 percent in the first quarter. Read more

Posted on May 1, 2008
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B2B Growth Strategies for a Down Economy

B2B media luminary shares some tips.

Via http://www.aicpalearning.org, Hank Berkowitz writes:

When it comes to B2B e-newsletters for financial professionals, no discussion would be complete without checking in with Rick Telberg, President of Bay Street Group Research in Dobbs Ferry, NY. Arguably the most widely-read journalist and analyst covering the accounting profession, Telberg is the co-author of a new research report: Beyond the Click: Maximizing Advertising ROI in B2B E-Newsletters.

Request a FREE copy of the executive summary of the report, here.

CPA Marketing Insider (CMI): Rick, it sounds like you’re not a big fan of using clicks to measure the success or failure of online ad campaigns, especially in e-newsletters.

Rick Telberg: Correct. I’m just not seeing much of a correlation between advertisers who are continually renewing their campaigns in their favorite media properties and the clicks they’re getting from those campaigns. Several media partners I’ve talked with note that some of their longest-standing clients fall into the middle and even lower tiers in terms of raw click-through rates they’re seeing.

CMI: With marketing departments and ad agencies stretched so thin these days, can media partners really expect their advertisers to develop creative specifically for their own publications and Web properties?

Telberg: I’d flip that around. Read more

Posted on April 17, 2008
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