AccountingWEB Weekly News Wrap-Up - Issue 145
1. Department of Justice v. Arthur Andersen LLP
2. PwC Consulting Files SEC Registration For IPO
3. SEC's EDGAR Goes Global to Meet Investors' Needs
4. Missouri Stops Sending Refund Checks to Taxpayers
5. Volcker Ends His Role as Andersen Savior
6. AICPA May Ban Reports on Hypothetical Transactions
7. SEC Hears of Alternatives to Faster Filings
8. Microsoft to Buy Navision For $1.33 Billion
9. AICPA Issues Update on State Legislative Proposals
10.Andersen Reaches Settlement in Baptist Foundation Lawsuit
National attention is again focused on the accounting profession this week as the Andersen trial in the Enron affair began in Houston. For the tens of thousands of other CPA firms who were not involved in the Enron unraveling, now would be a good time to put your best face forward in your local community to shed some positive light on the profession. Volunteer your services to a charity. Volunteer your office facilities for a meeting of a not-for-profit group. Speak at your local college campus about how your firm is being proactive in the community. Adopt a high school class and teach them about the accounting profession. Provide tax assistance to low-income taxpayers. Opportunities abound, and your input is desperately needed.
1. Department of Justice v. Arthur Andersen LLP
The U.S. Department of Justice and Big Five firm Andersen faced off in the courtroom this week as The Trial began. Andersen has been charged with one count of obstruction of justice stemming from the firm's destruction of documents relating to its Enron audit. These stories recap the week's events:
Big Five firm PricewaterhouseCoopers has announced that its consulting arm, PwC Consulting, has filed a registration statement with the Securities and Exchange Commission for an initial public offering of Class A common shares. The float is expected to occur sometime in mid-August.
Starting November 4, 2002, the Securities and Exchange Commission will take its EDGAR (Electronic Data Gathering Analysis and Retrieval) system global by requiring non-U.S. as well as U.S. issuers of securities to file certain documents electronically.
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Missouri taxpayers will have to wait a little bit longer to receive refunds this year. Facing an unexpected budget crunch, Missouri officials have stopped mailing refund checks to taxpayers who are owed refunds from their 2001 state income tax returns. Approximately one-third of Missouri's refund-expecting taxpayers are affected.
Former Federal Reserve Board Chairman Paul Volcker, leader of the independent oversight board created to help Andersen find its way through its struggles since the Enron situation came to light, announced that he can do no more for Andersen and is giving up his effort to save and reform the firm.
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Auditors may soon be prohibited from playing a controversial role in structuring transactions to achieve a desired effect on financial statements. The change would take effect under a draft of an auditing standard proposed by the AICPA's Auditing Standards Board. The ASB's proposal would limit the role played by accounting firms by banning reports to underwriters on the application of accounting principles to transactions known as "hypothetical transactions."
The deadline for comment letters on its proposed rules for faster filings and Web postings doesn't come due until May 23, but already the SEC is hearing of alternatives that might be better for both companies and investors. A variety of comments and letters are available on the SEC Web site.
Microsoft has taken another step forward in its quest to become the dominant solutions provider to the small to mid-size business market by announcing the acquisition of Navision, the software company providing accounting and HR solutions to mid-sized enterprises. The deal is valued at $1.33 billion.
State legislative initiatives for post-Enron accounting and audit reforms are proliferating and proceeding at rates comparable to federal initiatives. As a service to its members, the AICPA has worked with the state societies and its Regulatory Affairs division to compile an update of the Enron-related legislative proposals now under consideration at the state level.
Big Five firm Andersen has agreed to a $217 million payment to end litigation brought against the firm relating to its audit of the now-bankrupt Baptist Foundation of Arizona. The settlement resolves all pending litigation brought against Andersen by the BFA investors, the BFA bankruptcy trustee, and Arizona state regulatory bodies.
Visit our Q&A Forum to post your questions and share your ideas with the members of AccountingWEB! Simply click on the "Add Comments" option at the bottom of any question to add your response and comments.
Here is a sample of the questions that have been posted this week. Post your own questions or see if you can lend a hand to others looking for help.
1. Excel Formatting: Is there a way to automate a large quantity of calculations by formatting a spreadsheet so that the = sign will automatically be entered in the cells that will contain formulas and the user only has to enter the various operations on the numbers?
2. Nil Paid Share Issue: A Holding Company acquired a subsidiary by issuing shares in exchange with subsidiary shareholders' shareholding. What are the investment cost and the accounting treatment with share capital?
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Voice of the Editor
Which isn’t completely true. I mean, occasionally I drop by when I manage to sneak out of the nonstop frat party over at Going Concern, but I’m mostly a wallflower over there. I’m happy to say that I’ve been given express permission (or explicit orders, if you like) to wander over here to AccountingWEB more often.
Why is that, you might ask? My job is to replace the irreplaceable Gail Perry as Editor-in-Chief. What does that mean? I don’t really know! I think it’ll be fun getting a feel for things, throwing in my own thoughts here and there, and listening to the discussions you’re having about the accounting profession.