AccountingWEB Weekly News Wrap-Up - Issue 132
1. AICPA Statement on New Auditor Independence Position
2. Grant Thornton Weighs in on Accounting Reforms
3. Global Companies Tackle Auditor Independence and Oversight
4. D&T Ends Holdout - Will Split Off Consulting
5. Andersen Records Subpoenaed; Astros' Stadium May Change Name
6. IRS Extends Deadline for Household Employees' W-2 Forms
7. NYSSCPA Testifies Before State Senate Committee in Post-Enron Era
8. Pitt Tells Congress, "Much More Needs to be Done"
9. Andersen CEO Outlines Vision for a New Era of Accounting
10.Moody's, S&P Ask Companies to Disclose Rating Triggers
For obvious reasons, everyone is talking about ethics these days. We would like to encourage all AccountingWEB members to join others in the profession in a live video Webcast next Tuesday February 12 from 2-3pm EST for a special debate entitled "Ethics: Our Joint Responsibility" hosted by Tax Talk Today. The Webcast will feature panelists from the legal profession, the IRS, and the enrolled agent community discussing the role of ethics in practice before the IRS. The Webcast is free, but requires advanced registration to confirm your space. Please go to www.taxtalktoday.org for details and to register.
Additionally, we would encourage you to mark your calendars for Wednesday February 20 at 3:00 pm EST to join AccountingWEB members in an online discussion of the Future of the Profession, in a session hosted by the National Conference of CPA Practitioners. This session is also free to AccountingWEB members, and further details will be forthcoming.
We'll see you there!
The AICPA distributed an e-mail message to members on Friday, February 1 outlining a change in position. The AICPA now opposes the practice of a firm providing certain kinds of consulting and internal audit services to a public client which the firm audits. The message outlines plans for a significant public relations campaign in the next few weeks, and includes the commitment to go forward with the student outreach campaign without delay.
Chicago-based Grant Thornton added yet another side to the multi-dimensional debate about the reforms needed to restore confidence in the accounting profession. "As the leading global firm dedicated to the needs of middle market companies," the firm feels that "growth should never be at the expense of public trust." The firm proposes to restore the profession’s credibility with a five-point program.
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In the U.S., the Enron collapse continues to be the subject of investigations by at least ten congressional committees. But the fallout has grown increasingly global in scope, and global companies are taking action to achieve the needed reforms without waiting for U.S. lawmakers. Find out how Unilever, CGNU, and Disney are responding to the current climate of change in the accounting profession.
Seven months ago Deloitte & Touche was adamant about not separating its consultancy from the rest of the firm. But a lot has changed in seven months, and the Big Five firm has now announced plans for separating its audit from its consulting services. In so doing, it joins Andersen, KPMG, PricewaterhouseCoopers and Ernst & Young, making support for this audit reform unanimous among the Big Five.
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Connecticut Attorney General Richard Blumenthal received permission from the State Board of Accountancy Tuesday to subpoena records from Big Five firm Andersen in relation to an investigation that could lead to sanctions against Andersen and the removal of Andersen's license to practice in the state. Meanwhile, The Houston Astros have filed a motion with the U.S. Bankruptcy Court for the Southern District of New York asking that the court revoke the club's naming rights agreement with Enron Corp.
The IRS has announced that W-2 forms for household employees are due this year on February 15 instead of the original January 31 deadline. The change is due to the fact that the booklet that contains the forms and instructions for household employee W-2 forms, Package H, was not mailed until January 25, giving employers little time to meet the January 31 deadline.
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The New York State Society of Certified Public Accountants testified Wednesday at hearings conducted by Senator P. LaValle, chair of the New York State Senate Higher Education Committee. The testimony addressed CPA independence and regulation in light of the recent bankruptcy of the Enron Corporation. In its testimony, NYSSCPA called for "raising the quality bar" and made specific recommendations for changes in New York State regulation, disciplinary systems, enforcement, and peer review.
Ethics: Our Joint Responsibility
Coming next Tuesday, February 12, at 2:00–3:00 pm EST, the IRS is sponsoring a FREE on-line Webcast. The subject on "Tax Talk Today" will be "Ethics: Our Joint Responsibility". Register Now.
Testifying under oath at Congressional hearings, Harvey Pitt, Chairman of the Securities and Exchange Commission, gave his views on possible legislative actions and responded to a series of pointed questions, including, "Are there any more Enron's out there?" A quick review of the questions and answers will give you a good indication of the types of changes being discussed on Capitol Hill.
Andersen's CEO, Joseph Berardino, spoke to the House Committee on Financial Services Tuesday, further explaining his firm's role in the restatements of Enron's financial statements and describing his vision of the direction accounting should take in the future.
AccountingWEB Live Online Discussion
Please join us on Wednesday, February 20 at 3:00 pm EST for an online discussion sponsored and hosted by the National Conference of CPA Practitioners. The leadership of NCCPAP announced their concerns regarding the fallout from the events surrounding Enron. The leadership of the organization believes that this situation has the potential to permanently tarnish the reputation of this country's Certified Public Accounting community. The leadership of NCCPAP pledges to continue to speak out about issues that adversely affect the public and the accounting profession. Mark your calendars and join us for this informative open session live on the AccountingWEB site.
Faced with the prospect of increased scrutiny by the Securities and Exchange Commission, Moody's Investors Service and Standard & Poor's said yesterday they have expanded the types of information requested from companies. Both agencies are now asking companies to disclose rating triggers. These are clauses in agreements that can adversely affect a company's liquidity if and when the company's rating is downgraded.