Attestation Update – A&A for CPAs

Technical stuff for CPAs providing attestation services

Interview with Scott London during CPE webcast

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Scott London was interviewed at length during a CPE webcast presented June 25, 2014. The class was presented by Gary Zuene, of The Pros & The Cons.

Mr. London was remarkably open.

He repeatedly accepted full blame for the insider trading. At several points he explained the context, pressures he was under, and actions by others (especially his golfing buddy) that help us understand the situation better. Each time he mentioned something outside of himself he again said that he is responsible. He is to blame.

At one point he made a comment for which an inference could be made that his golfing buddy might have responsibly for the insider trading. He quickly added that it is his fault.

Michael Rapoport has an article in the Wall Street Journal on the interview: Prison-Bound KPMG Ex-Partner Remorseful for Insider Tips. Remorseful is a good description. It’s a good article. Check it out.

Nervous? Understandably so.

It seemed like Mr. London was nervous and uncomfortable during the interview. Imagine that.

He was exposing himself to scrutiny by everyone, including people who will be quite critical. He was sharing some of his psychological imperfections. He hinted at some personality flaws he is now trying to explore. I picked up on some he was suggesting. A psychologist could watch the interview and discern several unflattering parts of his personality that he unintentionally revealed.

Oh, and he’s also going to prison within a month.

No wonder he was nervous and uncomfortable. There were only 2 breaks of 10 minutes each. The technology used by CPA Crossings put all of the interviewers on screen the entire time. It would be a rare person that would go on camera for four hours in such a situation. Even rarer would be a person who would appear as composed as any of the interviewers. I’d be very worried about someone who could be calm, cool, and collected in such a situation.

Mr. Zuene thanked Mr. London at the end of the interview for being so open and sharing so deeply.

Another interviewer was Michael Sallah, an investigative journalist from the Washington Post. He has interviewed a lot of people in legal trouble and said Mr. London is a breath of fresh air. He said that Mr. London had been quite transparent and based on the comments in the interview was well on his way to rebuilding himself.

This is the first in a series of blog posts I will write about the interview. There are a lot of comments in the interview that we can all learn from.

You can still get the webcast

By the way, the class will be rebroadcast two more times. You can pick up four hours of ethics CPE.

Mr. London said he routinely encounters the attitude that CPAs have to take an ethics class. I have heard those comments. Sort of the way you refer to getting some cavities filled or putting new tires on the car. That is an understandable reaction as I ponder a lot of the ethics classes I’ve attended over the years.  Checking off that state board requirement is just a part of the dreariness of meeting minimum requirements.

One of the changes Mr. London suggested we as a profession need to make is for ethics classes to be interesting. We need to figure out a way to make those classes appealing.

This class makes that change. It is a wide-ranging conversation. A great mixture of details on this fiasco, ethics in general, cases addressed at the state board level, and how the situation intersects with other accounting and auditing issues. It briefly brings in bigger issues in the economy.

Check out the rebroadcasts at 9 AM on June 27 and 4 PM on June 30. Both times are Eastern time zone.

Next post: More consequences. Painful ones.

Written by Jim Ulvog

June 26, 2014, 9:36 am at 9:36 am

Posted in Audits

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