AccountingWEB Weekly News Wrap-up - Issue 32

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The AccountingWEB Friday Wrap-Up Newswire - Issue 32
March 3, 2000

In the news this week:

1. Cap Gemini Merges With Ernst & Young Consulting
2. PricewaterhouseCoopers Fights Back
3. In General, Auditors Are Too Lax on Independence Standards
4. Retirement Plans For The Masses
5. Who You Gonna Call? Stress Busters!
6. Follow Washington’s Lead and Help Feed The Hungry
7. Help Craft The Future of the CPA Exam
8. The IRS Needs a Good Accounting Firm
9. Stress The Importance of Recordkeeping To Clients
10. Tips On Working With The Media

Editor's Note

Big news this week as Cap Gemini merges with the consulting arm of Ernst & Young. This merger continues the trend of the Big 5 separating their consulting arms from their assurance arms, and infusing public capital to power the technology consulting boom. There’s a lot of big money betting on the boom. So whether you’re an investor or a technology consultant, this development should be interesting to watch.

Michael T. Platt
mailto:[email protected]

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AccountingWEB's Online Workshop Schedule
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Be sure to mark your calendars to join us for the upcoming online AccountingWEB workshops. Be sure to tell others in your firm who would benefit from these sessions to join you online too!

Monday March 6 9:00pm EST - Tax Season Q&A

Tuesday March 7 4:00pm EST – More About Adding Value To Your Services

1. Cap Gemini Merges With Ernst & Young Consulting

An $11 billion merger announced this week between French technology services company Cap Gemini and the consulting arm of Ernst & Young will create one of the world’s biggest consulting organizations. An infusion of $365 million to E&Y and issuance of 43.5 million shares will result in E&Y auditing and consulting partners owning a 36% equity stake in the combined organization. This is just the tip of the iceberg according to the experts. Expect many more partnerships of this type to be forged to take advantage of technology consulting opportunities.


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This newswire will be read by thousands of accounting professionals this week. Worldwide, AccountingWEB is a global community of over 60,000 accountancy professionals. For advertising information, contact Ryan Carmen at mailto:[email protected]

2. PricewaterhouseCoopers Fights Back

A public brawl involving the SEC, the news media and PWC has the Big 5 accounting firm up against the ropes denying media allegations that the SEC alerted audit clients that the integrity of their audits may be in question because of breaches of independence standards by the CPA firm. “No one has questioned the reliability of our clients’ financial statements,” said a PWC spokesman. However, Compaq computer is one of those clients who admitted that it had been asked by the SEC to name a new auditing firm, and will be dropping PWC in favor of rival Ernst & Young.

3. In General, Auditors Are Too Lax on Independence Standards

A recent AccountingWEB survey agrees with SEC findings that auditors of public companies are too lax in their adherence to independence standards. 38% felt that auditors are generally too loose with the standards, and 17% feel that there is widespread disregard for the standards. 27% feel that a minority of auditors circumvent the rules; 14% feel the standards are outdated; and a mere 5% believe that the SEC is on a witch hunt against the profession.

4. Retirement Plans For The Masses

401(k) and 403(b) retirement plans just got easier and less expensive due to an alliance between Internet startups and The new service will enable customers to quickly move their client plans onto the Internet, accompanied by a full range of recordkeeping and access to a number of fund families. Costs of administration are drastically lowered, putting 401(k) and 403(b) plans now within the reach of over 3.6 million small businesses, who up until now could not afford to make this benefit available to their employees.

The Five Rules of Finding New Clients: befriend the gatekeeper; meet with the right person; call when it’s quiet; be creative; stick with it. For details on implementing each of these, see:

5. Who You Gonna Call? Stress Busters!

What are you doing this time of year to reduce the stresses of tax season? AccountingWEB’s members shared their thoughts in a workshop this week and came away with some great ideas. Among them: a tax olympics, partner auction, jelly bean counter contest, trivia contests, chair massages, secret buddies, scavenger hunts, and casino nite, just to name a few. What are the tricks to success? Keep it simple and make an impact! For details and more ideas:

6. Follow Washington’s Lead and Help Feed The Hungry

A unique public service project of the Washington Society of CPAs is helping to feed more than 1 million hungry children and adults across the state. From now through April 15, traditionally the slowest time for area food banks, CPA firms are looking to pick up the slack by equating tax season with an organized food drive. Staff and clients are encouraged to participate. You can do your part too. With six more weeks to go until April 15, you can encourage your staff and clients to really make a difference!

7. Help Craft The Future of the CPA Exam

The AICPA is looking for a few good men - and women – who will volunteer to test pilot some new questions for the Uniform CPA Exam. The Institute is revamping the test to better reflect today’s CPA practice. If you are a CPA with 1-3 years of experience and have passed the CPA exam within the past two years, then the AICPA wants you. Testing will be held in New Jersey beginning March 27. Contact Jennifer Kobrin at 201-938-3420 or mailto:[email protected].

8. The IRS Needs a Good Accounting Firm

The General Accounting Office of the US Government has given the IRS failing grades on its ability to keep and manage its own books. The GAO audit highlights the fact that the IRS doesn’t know how much is coming in or how much is going out. The IRS frequently gives improper refunds, is slow in correcting errors, cannot account for its own equipment and property, and is at risk for computer security problems. Despite all of this, however, you still need to send in your returns . . .

9. Stress The Importance of Recordkeeping To Clients

The phenomenon of day trading is something that is affecting more and more Americans as Internet access makes Wall Street access easy. The phenomenon is also causing increased frustrations with the US Tax Code, as the IRS’ Schedule D is seeing dozens, hundreds, even thousands of trades on individual returns. A typical day trader, David Goehl is a 31 year old self employed lawyer who executed over 3,500 stock trades last year for a net profit of $85,000. Although he uses a spreadsheet to track profits and losses, he admits that keeping up with taxes is maddening. His advice? Keep up with recordkeeping on a weekly basis and you’ll save a tremendous amount of time later. That’s advice your clients can use too.

10. Tips On Working With The Media

We are all busy professionals, and time is a precious commodity. That is true with the media as well. As you proceed with your media relations programs, you need to know the rules of the game from the media’s perspective. What works? What doesn’t? How do you get your information through the clutter? What are the pet peeves of reporters? A feature this week on AccountingWEB highlights many of those issues and points you to an information-rich resource to improve your success rate. Don’t miss it!!

Q&A Forum
Several new questions have popped up this week on the
AccountingWEB Q&A Forum. Please take a moment to help
if you have any information that is appropriate on any of the
following issues:

* Capital Gains Issues

* Internet enabled accounting software

* The de-skilling of the accounting profession

For full details of these questions, or to post your own, see:

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