AccountingWEB Weekly News Wrap-up - Issue 20

The AccountingWEB Friday Wrap-Up Newswire - Issue 20
December 10, 1999
http://www.accountingweb.com

In the headlines this week:

1. Top Story: E&Y May Sell Its Consulting Group
2. Do Consulting Services Affect Auditor Independence?
3. Success Factors Of M&A Outlined in Extensive Survey
4. Never Thought You Would Deal With OSHA? Think Again . . .
5. Technology Is Changing The Face of Financial & Business
Reporting. Are You Prepared?
6. Can A Virtual Assistant Solve Some Of Your Admin Issues?
7. SEC Continues To Press Revenue Recognition Issue
8. Dare To Get To Know Your Competitor
9. Is An Ethical Assurance Service In Your Product Mix?
10. Neat Must-Have Toy: C-Pen Scanner


Editor's Note

Big news this week as Ernst & Young confirms its interest in selling its consulting arm to Paris-based Cap Gemini. This possible move further confirms the desire for the Big 5 accounting firms to either divest their consulting arms or take them public, while at the same time clearing the path to avoid ongoing SEC scrutiny over auditor independence.

Consolidator Short Takes: AmEx Tax & Business Services Division names Andy Cvitanov new head of TBS; Centerprise Board regroups to explore traditional merger, private investment backing, or another IPO; H&R Block completes $850M purchase of Olde Financial Corp.

And so it goes . . .

Michael T. Platt
Editor-in-Chief
mplatt@accountingweb.com


New AccountingWEB.com Feature Added

A new AccountingWEB service, Forecasts and Reflections, was launched this week to help bring the voices, opinions and collective thoughts of the accounting community together on significant trends and issues affecting the profession. A very user-friendly easy-to-use comment screen is the vehicle to gather the opinions and take the collective pulse on vital issues of the day. Why not try it out? Your input is requested on this month's question: "What service area has the most growth potential for your firm in the coming 12 months?" Go to http://www.accountingweb.com/cgi-bin/item.cgi?id=9594&d=101and share your views.


1. Top Story: E&Y May Sell Its Consulting Group

Big 5 accounting firm Ernst & Young confirmed this week that it is in discussions with Paris-based Cap Gemini regarding the possible sale of its consulting arm, Ernst & Young Consulting Worldwide, which last year generated about $4 billion in sales, or 35% of the total revenues for the firm. Recognizing the continued scrutiny of the SEC towards auditor independence, spokesmen at E&Y admit that divesting the consulting arm will help the E&Y accounting firm avoid some of those conflicts of interest in the future. No immediate decisions or announcements about a deal are expected.
http://www.accountingweb.com/cgi-bin/item.cgi?id=9539&d=101


Profitability Consulting Course for CPAs Jan. 11-14, 2000

The Quantum Institute for Management Advisors is offering
its Profit and Value Advantage (PVA) Course on January 11-14
in Las Vegas. The PVA Course provides hands-on training in
performing value-added engagements. For more info, please
call 800-869-0491 or e-mail sally@pencormazur.com. Be sure also to visit the Pencor Mazur page in the Accountingweb Presszone.


2. Do Consulting Services Affect Auditor Independence?

With the E&Y announcement of looking to divest its consulting arm, the question is again raised, "Do consulting services affect auditor independence?" Critics say that performing consulting services for an audit client impairs independence just as much as owning stock does. The answer is that consulting services could affect audit independence, but they don't have to. There are rules in place that govern this type of activity, but there's definitely a lot you can do within your firm to put your best foot forward. Maintaining current independence files will help, as will annual ethics training. Just knowing that questions like these exist will help you ward off rumors and be ready should a prospect or client ask the question. Do you know what you will say?
http://www.accountingweb.com/cgi-bin/item.cgi?id=9377&d=101


3. Success Factors Of M&A Outlined in Extensive Survey

A surprising 83% of corporate mergers and acquisitions do not result in increased shareholder value, according to a recent report released by KPMG. The results stress the importance of integration in the pre-deal period, including addressing the challenges of culture and communication in the deal. In what is a must read for M&A consultants, the survey delves into the key success factors and challenges experienced by over 700 mergers in the last few years. So whether you are a consultant or are looking to merge your practice with another, be sure to download the results of this survey and find out how to benefit from the experiences of others in your future plans.
http://www.accountingweb.com/cgi-bin/item.cgi?id=9382&d=101


IRS announces this week that interest rates for the calendar quarter beginning January 1, 2000, will remain at 8 percent for overpayments (7 percent in the case of a corporation), 8 percent for underpayments, and 10 percent for large corporate underpayments.


4. Never Thought You Would Deal With OSHA? Think Again . . .

Ergonomics education and training will soon be a legal obligation for your firm. Never mind the workers' comp claims. The U.S. Occupational Safety and Health Administration recently proposed an Ergonomics Program standard that, after discussions in early 2000, will become mandatory by year-end. OSHA proposes that you will have to: 1. Establish procedures for employees to report symptoms of ergonomic injuries; 2. Inform employees of workplace hazards; 3. Repeat ergonomic training once every three years; 4. Analyze jobs and consult employees in those jobs to identify factors that may cause injury; 5. Keep written records of actions taken and injury rates (except companies with 10 or fewer employees); and 6. Provide employees with medical care at no cost to them to treat their work-related injuries. Start your program now and you'll be set for next year.
http://www.accountingweb.com/cgi-bin/item.cgi?id=9339&d=101


5. Technology Is Changing The Face of Financial & Business Reporting. Are You Prepared?

The increasing use of the Internet, and its multimedia capability, are two pervasive factors stretching the boundaries of what financial reporting means to the financial and business community, according to a report just issued by the Canadian Institute of Chartered Accountants. Issues raised include the impact of electronic on-line reporting on the content, timing and format of financial information, the types of financial and non-financial reporting that may be provided continuously throughout the year, and the integrity of electronic financial information. For a full understanding of what you need to know and how this issue will affect your practice, be sure to get your copy of this report by emailing orders@cica.ca.
http://www.accountingweb.com/cgi-bin/item.cgi?id=9444&d=101


AccountingWEB welcomes AGN North America to the growing list of organizations that are offering daily AccountingWEB news headlines to their members. Contact Ryan Carmen at AccountingWEB rcarmen@accountingweb.com if your organization would like to syndicate our news for free.


6. Can A Virtual Assistant Solve Some Of Your Admin Issues?

Among the many things the Internet can do for you today is provide access to an unending supply of outsourced administrative assistance. Technical writing, developing PowerPoint presentations, database entry -- any project can be outsourced to individuals who typically will charge $25-$30/hour. Email and fax are the tools of the trade, and you can bring in these assistants on a project-by-project basis. No ongoing commitments, no benefits to offer, no employee issues. Just let them know what needs to be done, check the accuracy of the work, and get on with what you do best.
http://www.accountingweb.com/cgi-bin/item.cgi?id=9448&d=101


7. SEC Continues To Press Revenue Recognition Issue

SEC Chairman Levitt has not been shy in his zeal to increase the accuracy of corporate revenue reporting to the public. This week the SEC issued a staff accounting bulletin (SAB) spelling out the disclosures that companies should make about their revenue recognition practices. Be sure to download this bulletin and get the SEC guidance on revenue recognition issues.
http://www.accountingweb.com/cgi-bin/item.cgi?id=9477&d=101


Productivity Tip: Turn your voice mail on fifteen minutes before you leave the office. You won't feel quite as rushed when those "last minute" calls come in as you're racing out the door.
Source: Communications Briefings


8. Dare To Get To Know Your Competitor

Take this challenge: Identify your biggest competitor, the one you run up against in every proposal, the one who has been snatching key staff, the one who always gets their name in the local paper, and . . . take them to lunch! You may gain tremendous insight into what they are thinking, what their motivations are, and what new services they are about to launch. Both of you will recognize that trade secrets should not be shared, but people love to talk, and they love to talk about things they are doing. Dare to get to know your competitor. You will be a better service provider as a result.
http://www.accountingweb.com/cgi-bin/item.cgi?id=9509&d=101


9. Is An Ethical Assurance Service In Your Product Mix?

Annual reports are chock full of numbers, forecasts, earnings and assurances from the company's CPA firm that all the numbers add up. Many companies are starting to issue annual reports with descriptions not only of financial performance but also how well the company is sticking to its stated ethical or social values. And guess who's bringing that assurance to the general public? That's right, the CPA. New service opportunities are springing up for you to not only restate earnings for the year, but also to verify that a chemical plant is within the legal boundaries of toxic emissions, or a clothing manufacturer is dealing with a reputable distributor who is not employing child labor overseas. The ground is uncharted, and there are no guidelines in place yet, but the opportunity is ripe to help your clients, the public and the public interest by introducing ethical assurance services into your mix.
http://www.accountingweb.com/cgi-bin/item.cgi?id=9535&d=101


10. Neat Must-Have Toy: C-Pen Scanner

I was sitting on an airplane last week next to someone who was using a handheld portable scanner no larger than your traditional yellow highlighter. She was effortlessly scrolling through text in an article from Inc. magazine to be stored and shared later with her staff. I came home and looked up the website of C-Pen (http://www.cpen.com) and was amazed to learn that you can store up to 3000 pages of text in the C-Pen, which can then be transferred to any computer documents using infra-red technology. Check out the site, or go into your local Office Depot and try it out -- just $200!

If you know of an Internet tip, or a technology tip that others can benefit from, you are encouraged to send it in to us at mailto:editor@accountingweb.com.


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