Trends

Freddie Mac Agrees to Pay $125 Million Fine

Freddie Mac has agreed to pay a $125 million civil fine to settle federal regulator's allegations of mismanagement at the mortgage finance giant that is blamed for a $5 billion understatement of earnings.The Office of Federal Housing Enterprise Oversight (OFHEA), which regulates Freddie Mac and the larger Fannie Mae, also released a report saying that weaknesses existed in every aspect of Freddie Mac's accounting process. The Wednesday report cited "a pattern of inappropriate conduct and improper management of earnings" at the company.
Community News

AICPA Chair, Voynich Calls For More Changes

S. Scott Voynich, Chair of the American Institute of Certified Public Accountants, said today that further changes were necessary to regain the confidence of American investors. Voynich was the keynote speaker at the Institute's 2003 AICPA National Conference on Current SEC Developments, which opened today."It is not enough to embrace change," Voynich said to an audience of nearly 2,000 CPAs, regulators and reporters.
Community News

AICPA Takes Steps to Improve Investor Confidence

Correction: In our item this week headed "New Accounting Standard SAS 99 to Begin December 15, 2003," we indicated that the new standard is effective for audits performed for periods beginning on or after Dec. 15. We need to make clear that this new standard is effective for audits performed for periods beginning on or after Dec. 15, 2002 (not 2003). Audits performed for periods beginning on or after Dec.

Foreign Outsourcing Expected to Grow, but Tough Issues Abound

As outsourcing technology jobs overseas becomes more widespread, businesses are learning they have to be sensitive to their customers’ concerns as well as their bottom line.U.S. companies are becoming increasingly reliant upon contractors in cheaper labor markets abroad to handle customer service calls, programming, processing of forms and other tasks. But companies are also finding that customers sometimes balk at talking to a customer service representative on another continent.
Tax

AICPA Chairman Responds to Foreign Outsourcing Concerns

In a recent letter to Scott Voynich, Chairman of the Board of Directors for the AICPA, the Executive Board of the Texas Society of CPAs expressed concern over the growing trend of CPAs outsourcing services to foreign countries. You may read the AICPA's response below. Nita J.
Community News

Business Readies For Sarbanes-Oxley Compliance

A survey of nearly 400 tax executives regarding compliance with section 404 of the Sarbanes-Oxley Act revealed that 89 percent have begun planning or implementing processes and controls for their company's compliance with this federal law. Conducted by Tax Executives Institute (TEI) as part of its 58th Annual Conference, the October 20 audience survey also showed that a full 85 percent of the respondents had not allocated any additional budget or resources toward that initiative.
Community News

Canada Follows U.S. Lead With Strict Independence Standard

Canada’s chartered accountants have adopted a tougher independence standard that closely follows regulations issued in the United States after a series of corporate accounting scandals."The core principle of the new standard is that every effort must be made to eliminate all real or perceived threats to the auditor's independence," the Canadian Institute of Chartered Accountants (CICA) said Thursday.
Community News

Enron Creditors Allowed to Sue Lawyers, Auditors, Former Execs

The bankruptcy judge in the Enron case has ruled that the energy company’s creditors can sue two Houston law firms, an accounting firm and about three dozen former executives connected with the company’s demise.Creditors were granted permission to add the Vinson & Elkins and Andrews & Kurth law firms, accounting firm Arthur Andersen, and about 30 former executives to a civil lawsuit filed last year in Montgomery County, Texas, Reuters reported. U.S.
Community News

Are Your Employees Responsible For Spam? Is Your Organization Liable?

Hackers, spammers and those bent on using the Internet to exploit others are making inroads in their efforts to overwhelm PC users with unwanted e-mail including pornographic images.Experts are concerned about a new trend of relaying spam through unsuspecting computers left logged on to broadband connections, which are used as a conduit to forward thousands of messages to others without leaving a trace behind.
Community News

HealthSouth Ousts Five Directors to Settle Suit

HealthSouth will replace five of its directors to settle a lawsuit with the Teachers Retirement System of Louisiana, ending one of many lawsuits pending against the country’s leading operator of outpatient surgery centers and physical therapy clinics.Not removed from the board in the settlement is founder and former CEO Richard Scrushy, who was indicted last month on numerous federal counts tied to a massive accounting fraud at the Birmingham, AL-based company.
Practice Management

Survey Reveals More Organizations Detecting Fraud

Spurred by new government regulations and demands by investors, more companies today are working to uncover fraud, finding it, and taking action against those who commit fraud, according to a new survey by U.S. audit, tax and advisory firm KPMG LLP.The survey showed that 75 percent of respondents report they have uncovered fraud in their organizations in the last year, compared with 62 percent of executives responding to a similar survey in 1998. Employee fraud occurred the most frequently, although financial reporting and medical/insurance fraud were much more costly.
A&A

Incorporations Surge Even in Unpredictable Economy

Economic indicators are showing that a sluggish economy and an uncertain world are not stopping Americans from starting their own businesses in record numbers. Over the last year, self-employment has increased by 400,000, according to a Labor Department survey, reported by the Wall Street Journal. In the state of Delaware, an incorporation center, there has been a big increase in start-up businesses.

Board Approves PCAOB's 2004 Budget

The Public Company Accounting Oversight Board today approved a budget of $103 million for the 2004 fiscal year, reflecting planned investments in information technology to support the Board's registration, annual reporting, inspections, and enforcement programs, in addition to a more than two-fold increase in personnel. The Board's budget supports its mission to oversee the auditors of public companies in order to protect the interests of investors and further the public interest in the preparation of informative, fair, and independent audit reports.
Tax

Texas Society of CPAs Speaks Out About Foreign Outsourcing Trends

In a recent letter to Scott Voynich, Chairman of the Board of Directors for the AICPA, the Executive Board of the Texas Society of CPAs has expressed concern over the growing trend of CPAs outsourcing services to foreign countries. You may read and comment on this trend below. AccountingWEB members may add their comments below. Just click on the orange comment button below this article and add your comments and thoughts on this issue. Letter to the AICPANovember 11, 2003S.
Community News

Tips For Creating an Effective Employee Incentive Program

By Lisa A. Rozycki, Marketing Director, Reinsel & Company LLPEditor's Note: In an article published on AccountingWEB, Lisa Rozycki described how employee incentive programs can "Bring out the Best in Your Firm." Following up on this topic, Ms.
Technology

'Operation Cyber Sweep' Nets 125 Arrests and Convictions Nationwide

Attorney General John Ashcroft, Assistant Attorney General Christopher A. Wray of the Criminal Division, FBI Assistant Director Jana Monroe and Federal Trade Commission Chairman Tim Muris announced last week the arrests or convictions of more than 125 individuals and the return of over 70 indictments in a coordinated nationwide enforcement operation designed to crack down on the leading types of online economic crime. The operation targets a variety of online economic crimes that involved schemes including fraud, software piracy and the fencing of stolen goods.
Community News

Survey Reveals Clients Deeply Dissatisfied With Professional Service Providers

Despite efforts at reform brought about by corporate governance concerns and the Enron accounting scandal, corporate executives remain deeply dissatisfied with the work product provided by their accounting, legal, IT and other consultants according to a new survey. As a result, according to the survey, 1 in 9 professional services or consulting relationships could be terminated in the next 12 months.
Technology

Gates Unveils Technology to Fight Spam, Boost Security

Microsoft Chairman Bill Gates has unveiled products that will fight spam, tighten security and eventually allow for “seamless computing,” or the ability to share information among many kinds of devices.Gates, the keynote speaker at the Comdex trade show in Las Vegas Sunday, said SmartScreen technology, already used in the company's MSN network, Hotmail service and Outlook e-mail, will be included "in the months ahead" in Exchange Server 2003, Information Week reported.
Community News

2003 MAP Survey Results Reveal CPA Firm Growth Despite Sluggish Economy

Despite the down economy, 15% of local and regional firms surveyed in this year’s PCPS/Texas Society of CPAs (TSCPA) National Management of Accounting Practice (MAP) Survey reported an increase in client fees of more than 20%. A record-breaking 3,300 firms responded to the survey. The average participant firm employs seven CPAs and reported gross fees earned of approximately $1.4 million.

Professional Costs in Enron Bankruptcy May Hit $1B

AccountingWEB reported in November of last year that the failed energy giant Enron said it may spend close to $1 billion in associated costs with its bankruptcy proceedings by the end of 2006.According to a recent Wall Street Journal report, the 18-month probe has produced a four-volume report, totaling 4,500 pages with 14,000 footnotes referencing hundreds of thousands of pages of supporting documents. The final tab: more than $90 million. "I really believe that we have added value," says Mr.

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