AICPA released an exposure draft in early November which would revise some aspects of the peer review program.
The Journal of Accountancy has an article summarizing Changes proposed to peer review standards.
I have read through the exposure draft only once, which means I am just starting to understand the proposed changes. Three items jump out at me after my first read:
A few articles on various bank fiascos: first private settlement for manipulating LIBOR, two rumored criminal investigations for selling MBS’s, and a billion dollar settlement for money laundering.
11/13 – Reuters – Barclays in $120 mln settlement of Libor case – lawyers – Barclays is first out of the gate settling private lawsuits in US for manipulating Libor. Read the rest of this entry »
By a 6-1 vote, on 11/11/15 FASB authorized their staff to prepare the final draft of the lease standard. When the final draft is ready, it will be routed to the board members for a final, written vote.
Final standard is expected in early 2016.
(Cross-post from my other blog, Nonprofit Update.)
When sitting down to read my copy of The Wall Street Journal on Friday, I was surprised to read that a Jury Delivers First U.S. Libor Manipulation Convictions. This is even more intriguing after I mentioned last week that Explaining complex financial details to jurors is an obstacle to putting senior executives in jail and previously asked back in November 2014 So you think tons of bankers should be in jail? Getting a jury to agree seems to be a problem.
In this case, two bankers were indicted for conspiracy and wire fraud for manipulating Libor interest rates while they worked for Rabobank. On November 5 they were convicted by a jury. Therefore we no longer need to use the word allegedly when discussing their manipulation of interest rates.
Another bank, Credit Agricole, settles up for money laundering, with tab under a billion. Standard Chartered under a new investigation. Toshiba identifies 30 more senior staff who participated in the accounting schemes.
10/1 – Accounting Today – Toshiba Says 30 More Executives Names in Accounting Scandal – In addition to three former presidents resigning, an additional 30 executives have been identified in as players in the Toshiba book cooking scandal. None of the 30 will be fired.
Current over statement of income is estimated at US$1.3B in the article with a US$6B loss in market value.
10/20 – Wall Street Journal – Credit Agricole to Pay $787 Million in U.S. Sanctions Case and IRS – Credit Agricole Corporate and Investment Bank Admits to Sanction Violations, Agrees to Forfeit $312 Million.
Another bank had institutional policies to willfully circumvent US rules on money laundering for banks and individuals in sanctioned countries. NY DFS says total laundered amount was $32B. The bank admitted to one felony charge in a deferred prosecution agreement.
If you would like to compare the various definitions in play for materiality, then Emily Chasan has the article for you at the Wall Street Journal on 11/3: Definition of Materiality Depends Who You Ask.
The definition readers of this blog have incorporated deep into their brain is from FASB, as follows:
If I got it straight, the international consortium of Grant Thornton is writing the check to settle up for the fiasco on the Parmalat audit.
You may vaguely recall that mess. In two sentences, Parmalat had a fake bank account in the Cayman Islands that supposedly held €3.95B (yes, four billion Euros, that’s 4,000,000,000) which was around half of the consolidated balance sheet of about €8B as of 12/31/03. The auditors in the Italian affiliate (if I recall correctly) of GT sent a confirm to the address the client gave them for the bank in the Caymans which was, of course, intercepted, signed by company staff, and returned to the auditor.
The scheme fell apart and has been rattling around in the legal system for just over a decade, in and out of the US and bouncing between circuits when here.