Pondering

Don’t compare your messy backstage to someone’s presentable front stage

Leave a Comment / Pondering /

Things behind the scene are invisible to others. That’s the backstage. The ready-to-go portion shown to the world is the only part others see. That’s the front stage.

The ol’ sage advice is don’t compare your backstage to the front stage you see of others.

(This article is cross-posted from my other blog, Nonprofit Update, because it is something accountants need to keep in mind also.)

This applies in so many areas.

You know how your children behave at home or on a long vacation or how much effort it takes to get homework done. What you see in other families is the on-your-best-behavior public face and the brag-ready list of accomplishments that were oh so easy to achieve.

Compare the backstage of your family to someone else’s front stage as if that was actually a valid comparison and you will be distressed with either your children or your parenting skills. The most likely outcome is wondering why you are a failure as a parent.

Jeff Walker has a great video about that idea. He uses a messily hand-tailored shirt as a great contrast of the slick front stage and the messy, sloppy, slap-dash back stage.

Check this out:

[youtube=https://www.youtube.com/watch?v=Herruzu4HYY&feature=player_embedded]

 

Literally the difference between …

Don’t compare your messy backstage to someone’s presentable front stageRead More »

Don’t compare your messy backstage to someone’s presentable front stage Read More »

More good stuff for auditors – 9/1

2 Comments / Accounting, Audits, Pondering /

A few links and comments of interest to auditors. The Andersen name is back, how to classify ‘trapped cash’, government assigning audits, and The F Student (twice). Wow, am I confused. The Andersen name resurfaces, and vinyl record sales are surging. What’s next, disco?

August 2014 – The CPA Journal – Meet the Future of the Profession – Rumbi Bwerinofa-Petrozzello is one of the bloggers I follow. She writes on fraud at Figuring Financial Forensics.

She and three other young professionals were featured in the linked article in the NY state society. The four discussed their perspectives. Well worth a read.

In particular, I enjoyed the following comment from Ms. Bwerinofa:

…

More good stuff for auditors – 9/1Read More »

More good stuff for auditors – 9/1 Read More »

What is the point of accounting? Providing economic history or predicting the future?

Leave a Comment / Accounting, Pondering /

That is the underlying question raised by Prof. Charles M. C. Lee in a speech he gave which is summarized in an article at the Stanford graduate school of business website: Charles Lee: Why Fair-Value Accounting Isn’t Fair.

Let me help you stretch your brain. After writing this article, mine hurts. (Okay, okay, I hear you saying it doesn’t take much to strain Jim’s brain.)

The professor’s full speech is here. I read the first third of the paper, up to the point he starts talking about stock valuation theory. Good stuff.

One sentence summary from the article: …

What is the point of accounting? Providing economic history or predicting the future?Read More »

What is the point of accounting? Providing economic history or predicting the future? Read More »

BNP Paribas nearing settlement for $30B of money laundering. Getting a bargain at $8B penalty?

Leave a Comment / Pondering /

The Wall Street Journal reports BNP Near Settlement With U.S. for Up to $9 Billion.

The article says the bank and U.S. prosecutors have agreed on the broad terms of the settlement, which would include:

  • Penalty in range of $8B to $9B
  • Plead guilty to one criminal charge
  • Ban on dollar settlement, likely in range of several months
  • Firing of at least 30 employees

…

BNP Paribas nearing settlement for $30B of money laundering. Getting a bargain at $8B penalty?Read More »

BNP Paribas nearing settlement for $30B of money laundering. Getting a bargain at $8B penalty? Read More »

Heads starting to roll in BNP Paribas settlement talks

Leave a Comment / Pondering /

Saw this article in the Wall Street Journal a week ago, June 12– BNP Paribas Executive Chodron de Courcel to Quit Post.

Article says the chief operating officer will be leaving the bank at the end of June. He previously had been planning to retire on September 30. The announcement from the bank did not contain any reference to the investigations in the US, according to the article.

However, his name is on the list of heads demanded by New York state regulators as a part of the settlement talks. When I read the article I sensed his early departure, without acknowledging the investigation, was actually a part of the settlement talks.

…

Heads starting to roll in BNP Paribas settlement talksRead More »

Heads starting to roll in BNP Paribas settlement talks Read More »

Another perspective on BNP Paribas – centralized control of French economy

Leave a Comment / Other stuff, Pondering /

Previously mentioned another perspective on possible penalties on BNP Paribas for violation U.S. sanctions on trade in some countries – could it be U.S. harassment of banks who don’t bow to U.S. foreign policy?

At The Feed, Walter Russell Mead provides perspective on why there has been such a strong reaction from the French government – Hollande’s Top Priority: Save BNP. His discussion is quite helpful for me.

The article explains that the government, big companies, and the banking system in France are tightly linked. There are overlapping ownership interests, centralized control, close coordination, and wide revolving doors between the government and private sector.

The article explains: …

Another perspective on BNP Paribas – centralized control of French economyRead More »

Another perspective on BNP Paribas – centralized control of French economy Read More »

Now for a completely different perspective – US harassment of French banks.

Leave a Comment / Pondering /

Here’s a different point of view: US efforts to impose draconian penalties on foreign banks for providing financial services in countries that the US doesn’t like it is really just a case of imposing our political preferences on the world.

Since access to dollar-based accounts essentially requires settling transactions in New York-based systems at some point in the transaction, the U.S. is leveraging the location of dollar settlements to force everyone to comply with our foreign policy.

For an explanation of this perspective, check out this article in Financial Times: America prosecutes its interests and persecutes BNP. (Snappy title, by the way – wish I could write that well.)

…

Now for a completely different perspective – US harassment of French banks.Read More »

Now for a completely different perspective – US harassment of French banks. Read More »

How do you keep one rogue employee from destroying your company?

Leave a Comment / Other stuff, Pondering /

That is the question asked on my other blog, Nonprofit Update: How do you keep one rogue employee from destroying your company? Or at least prevent a FCPA guilty plea and $108M fine?

That is a question I’ve pondered over the years. Have asked several of my clients the question and haven’t gotten any great answers.

I did get helpful answers from two of my clients, but the circumstances are so specific that I can’t share anything of the conversations.

Good internal controls will help. A great ‘tone at the top’ will go a long ways. Showing in everyday actions and words that ethical behavior is the expected norm will be a powerful message. Aggressively dealing with known behavior that is outside the boundaries will send a powerful message to the organization.

But how do you make sure that some completely out-of-control person doesn’t do something that can threaten the existence of your organization?

See the linked post to read of 4 examples that are in the back of my mind.

How do you keep one rogue employee from destroying your company? Read More »

Please try to stay out of court

Leave a Comment / Other stuff, Pondering /

This article is cross-posted from my other blog, Nonprofit Update.  It is posted here as well because it might also be helpful for your business clients. The article is focused on charities, but the same ideas apply to for-profit businesses:  please try to stay out of court.

In my journeys as a CPA serving the nonprofit community, I’ve been able to observe one (or more) charity/charities that have been in court because of their involvement in civil litigation. The time and costs involved can be substantial if you find yourself in civil court.

I can’t talk about those situation(s) because of confidentiality rules.

There are several things an auditor would routinely do in such situations.  The auditor would see the costs incurred from looking at the general ledger. Because of the possible financial impact, the auditor would have discussed the status of the case and possible outcomes with management, looked at legal invoices, and read the legal confirmation letter received from outside counsel. I can’t tell you what steps I took in any particular situation.

What I can say after seeing one/some specific situation(s) is that you should try really, really hard to stay out of court.

The costs can be high. The distraction for your leadership (and membership if you have members of some sort) can be significant.

One situation I can talk about

…

Please try to stay out of courtRead More »

Please try to stay out of court Read More »

Growing complexity will increase. That will make auditing even more challenging.

Leave a Comment / Accounting, Audits, Pondering /

The overall rate of change today is increasing. This carries over to the business world. Commerce is getting more complex with every quarter that passes.

That will carry over to us as practitioners.

That’s the comment from a speaker at a recent conference.

…

Growing complexity will increase. That will make auditing even more challenging.Read More »

Growing complexity will increase. That will make auditing even more challenging. Read More »

More good stuff for auditors – 1-28-14

Leave a Comment / Accounting, Audits, Pondering /

Eight articles on the ‘net you might find helpful as an auditor –

The long simmering dispute over the PCAOB getting access to audit workpapers of firms working on China-based companies has stepped up to another level.  An administrative law judge banned the China-based subs of the Big-4 from signing opinions for six months. This is several orders of magnitude removed from my practice. I’m also guessing it’s outside the practice all the readers of my blog, but that is what makes it fascinating to watch:

1-23 – Wall Street Journal – Judge Suspends Chinese Units o Big Four Auditors – Michael Rapoport gives a great overview.

1-25 – re:The Auditors – One Way or Another: The SEC Versus The Chinese Big Four Firms – Francine McKenna provides lots of quotes & links, color commentary, accompaniment of a song from Blondie (“One way or another I’m gonna find ya / I’m gonna getcha getcha getcha getcha /One way or another I’m gonna win ya / I’m gonna getcha getcha getcha getcha”), and two suggestions how the SEC could reach out and ‘getcha’ some Big 4 firms: …

More good stuff for auditors – 1-28-14Read More »

More good stuff for auditors – 1-28-14 Read More »

You want to succeed in accounting? Invest in yourself.

2 Comments / Pondering /

That’s the extended point made by Tony Nitti in a New Years’ post at Going Concern – This Year, Resolve to Finally Decide What You Want To Be When You Grow Up in Public Accounting.

Don’t rely on the networking, hand-shaking, going-out-for-drinks-after-work schmoozing, and drumming up new business to get where you want. Although you may have to get really good at those things, the first priority is to invest in your skills and knowledge.

Oh, as expected for any Going Concern post, there is a fair amount of naughty language and word pictures. Just letting you know.

Three superb comments: …

You want to succeed in accounting? Invest in yourself.Read More »

You want to succeed in accounting? Invest in yourself. Read More »