Friday, July 23, 2010

If You're Going To San Francisco...AAA Will Be There

If you're going to San Francisco between July 31 and August 4, you can catch the American Accounting Association's (AAA's) Annual meeting. I attended the Annual Meeting in Chicago in 2007, and I highly recommend it. The AAA is the professional association for academics, but many practitioners (financial executives, auditors, audit committee members, and others) belong to AAA as well. (I am a card-carrying member of AAA.)

Here are just a few highlights of the AAA Annual Meeting, and the CPE sessions that precede it:

  • Conference on Teaching and Learning - with two tracks - one for practioners interested in learning about teaching now or in the future, and one for current teachers - I highly, highly recommend this program, which I attended in its earlier form in 2007; and again in NYC last year; various FEI members have attended over the years and found it a valuable and high level intro to what you'll face if you decide to enter teaching as an adjunct, part time, or full time prof; contact Dee Harris at AAA immediately if you are interested in this program at or 941-556-4119, since space is limited.
  • XBRL Teaching Workshop - preceding CPE Sessions and Annual Meeting - July 29-30.
  • Concurrent CPE sessions take place from Friday evening July 30 - Sun. Aug. 1
  • The AAA Annual Meeting takes place from Mon. Aug. 2 - Wed. Aug. 4
  • FEI leadership and members speaking at the AAA CPE Sessions/Annual Meeting Panels include (a) Marie Hollein, FEI President and CEO, FEI, on Panel 1.7: "Auditors, Management and Boards: What They Need to Deter Fraud," moderated by Cindy Fornelli, Executive Director, Center for Audit Quality, with additional panelists Eric Allegakoen, Vice President and Chief Audit Executive of Adobe Systems Incorporated, Randy Fletchall, Americas Vice Chair, Quality and Risk Management, Ernst & Young; b) Betsy Rafael, (VP Corporate Controller and Principal Accounting Officer at Apple, Inc.), as luncheon speaker Tues. Aug. 3 from 12:00 - 1:45 on: "The Future of Accounting: A Preparer's Perspective of the Uncertain and Challenging Future of Accounting as Convergence, Rregulation, and New Business Models Meet"; (c) Rick Brounstein (EVP and CFO, NewCardio, Inc.) and Bob Laux (Senior Director of Financial Accounting and Reporting, Microsoft Corporation), on Panel 3.2: "User and Preparer Views on the Financial Statement Presentation Project," along with panelists Dane Mott (Senior Equity Analyst, J. P. Morgan) and Sandra Peters (Head, Financial Reporting, CFA Institute). Moderator is former SEC Acting Chief Accounting Scott Taub, now of Financial Reporting Advisors. This panel was organized by 2009-2010 AAA Financial Accounting and Reporting Section (FARS) Chair Teri Yohn (also an FEI member, and a former SEC Academic Fellow). Another panel featuring FEI member and former AAA President Gary Previts is described further below.
  • Panel 5.1, Tues. Aug. 3, 2-3:30: The Pathways Commission (Charting a National Higher-Education Strategy for the Next Generation of Accountants)Moderator: Bruce Behn, The University of Tennessee; Panelists: Bill Ezzell, Deloitte LLP, Gary Previts, Case Western Reserve University (also an FEI member), Judy Rayburn, University of Minnesota, and Denny Reigle, American Institute of CPAs. The concept of charting a national higher education strategy was one issue identified in U.S. Treasury Advisory Committee on the Audit Profession's (ACAP's) 2008 report; the subcommitee on education/human resources was led by Gary Previts.
  • Panel 7.5: "Operating an Accounting Blog,"Moderated by: Bill McCarthy, Michigan State University, Panelists: Dave Albrecht, The Summa (Concordia College), Joe Hoyle, Teaching Financial Accounting (University of Richmond), Ed Ketz, Accounting Cycle (Penn State), Francine McKenna, re: The Auditors
    Tom Selling, The Accounting Onion.
  • Additional speakers at the AAA CPE Sessions and Annual Meeting each year include prominent members of the SEC, PCAOB, FASB and IASB board and staff.

The AAA Annual Meeting is a great opportunity to learn, mix and mingle with academics, practitioners and regulators. Think about it! But hurry and register soon if you haven't already!

Wednesday, July 21, 2010

Obama Signs Wall Street Reform & Consumer Protection Act

At a press conference moments ago, President Barack Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act into law. See Conference Report version prior to signing of Act; see also FEI summary of highlights of the Act by Cady North, manager of Government Affairs, FEI.

The White House Blog has a post by Jesse Lee linking to White House summaries of the Act and a related 3 minute video, What Wall Street Reform Means To You.

The President's signing of the Act was shown via live-stream video on earlier today, and an archived video will be availalble later today. (I assume the written text of his remarks will be posted in the White House Briefing Room later today as well.)

Obama opened his remarks noting that we faced the greatest recession since the Great Depression, and that "Although the economy is growing again, too many people are still feeling the pain of the downturn."

In listening to Obama's remarks earlier today, here are some things I noted as highlights:

While a number of factors led to such a recession, the primary cause was a breakdown in the financial system, a breakdown in responsibility, from the halls ...corners of wall street, to ...Washington, DC ... ...antiquated rules... unscrupulous lenders... firms like AIG placed massive, risky bets with borrowed money. While the rules left abuse unchecked, they also left taxpayers on the hook.

Obama reminded people numerous times during his remarks that, "Ultimately, there's no dividing line between Main Street and Wall Street." (I believe he was trying to demonstrate there is mutual reliance or a symbiotic relationship, so to speak, between the two, and the two should not view each other as 'opponents.') For example, Obama said: "The fact is, the financial industry is central to our nation's ability to grow, prosper, compete."

Bill Will Foster, Not Hamper, Innovation; Nothing To Fear From Reform
He added, "There are a lot of banks who understand this, a whole lot of bankers who want to do right.. this bill will help foster, not hamper, innovation, so firms compete based on price and quality, not on tricks, not on traps... provides certainty ... unless your business model depends on cutting corners or bilking customers, you've got nothing to fear from reform."

Among the things the President listed under the topic of "what Wall Street Reform Means to you," were:

  • making credit contracts "fine print" more understandable
  • looking out for people: companies will have to seek out customers by better products, not abusive practices
  • reform will finally bring transparency
  • shareholders will have greater say on pay of exec's, so they can reward success, instead of failure

No More Tax Funded Bailouts
Obama emphasized: "There will be no more tax funded bailouts, period.... If a large financial institution should ever fail, this bill gives us [a way] to wind it down... [no more] too big to fail, so we won't have another AIG."

Regulators' Role
"Regulators will have to be vigilant," noted Obama, adding, "we may need to make adjustments along the way." As noted further above, he also referenced 'antiquated rules' that will have to be addressed.

Tuesday, July 20, 2010

FASB Releases Proposal on Disclosure of Certain Loss Contingencies

Earlier today, FASB released its Exposure Draft (ED) of a proposed Accounting Standards Update: Contingencies (Topic 450): Disclosure of Certain Loss Contingencies. The 30-day comment period ends August 20, 2010.

Litigation Disclosures Controversial
The most controversial issue in the ED, which is being reissued after FASB considered the comments received on the original ED issued a few years ago, revolved around the enhanced disclosures on litigation contingencies.

Due to some critical feedback in the original comment letters on the prior ED, on litigation contingency disclosures in particular, FASB conducted additional outreach, including field tests and a public roundtable, before reissuing this ED.

Among the proposed changes noted in the ED (this is just one of the proposed changes):

The proposed amendments would retain the current qualitative disclosures and enhance them by requiring additional disclosures, for example, in the case of
litigation contingencies, disclosure of the contentions of the parties and how
users can obtain additional information about the litigation.

Similarly, in addition to the quantitative disclosures required under current U.S. generally accepted accounting principles (GAAP), the amendments in this proposed Update would require disclosure of publicly available quantitative information (such as the claim amount for asserted litigation contingencies), other relevant nonprivileged information, and, in some cases, information about possible recoveries from insurance and other sources.

Furthermore, a public entity would be required to provide tabular reconciliations, by class, of recognized (accrued) loss contingencies that present the activity in the account during the reporting period.
Nonpublic Companies Receive Some Disclosure Relief
The ED is applicable to public and nonpublic companies, but proposes one point of disclosure relief for nonpublic companies, that nonpublic companies "would not be required to provide a
tabular reconciliation of accrued loss contingencies."

My Two Cents
(I remind you of the disclaimer which appears on the right side of this blog...) A 30-day comment period on a FASB Exposure Draft is relatively short, it could be because this is really a "reissued" ED on which FASB previously sought comment, and after doing more outreach as noted above, is trying to address the full set of comments (pro and con - i.e., what to keep to keep as is, what to modify) received on the original ED. However, I would urge you to read the ED carefully and to exercise your right to respond to the ED to note areas of concern, or areas you support, by filing a comment letter with FASB by the Aug. 20 deadline.

Some of our prior coverage of this issue can be found here and here.

Friday, July 16, 2010

Ruttencutter Elected FEI National Chair

Brian B. Ruttencutter, CFO of the Cumming Group, Inc., was elected to the position of FEI's national chair for 2010-2011, after serving as vice chair for the past two years. George Boyadjis, executive director of CresaPartners, LLC, will now serve as national vice chair, and Marsha Hunt, vice president and corporate controller of Cummins Inc., will continue to serve as vice president at large.

Other members of the 2010-2011 Board of Directors announced in FEI's July 13 press release include Taylor Hawes, CFO of intellectual property and licensing for Microsoft - who will now serve as vice president at large on the FEI board,David B. Braden, assistant vice president and assistant treasurer with Cargill, Inc., who will serve as FEI Treasurer, and Katherine Anderson, CFO for the Seattle Opera, who will continue to serve as Secretary.

Also elected to the FEI Board of Directors was Kim K. Gazzola, vice president for finance and administration at Cambridge College, who was elected as Chair of FEI's research affiliate, the Financial Executives Research Foundation (FERF).

Marie N. Hollein, FEI President and CEO, noted, "We are privileged to have these accomplished business leaders as part of our organization and on behalf of FEI, I am pleased to extend a warm congratulations on their well-earned positions on our board. These senior-level executives have all demonstrated excellent leadership and their contributions to FEI's mission and our members are invaluable."

Visit FEI's website at and see what's new with FERF at .

Wednesday, July 7, 2010

SEC To Meet Next Week On Possible Concept Release On Proxy Voting

Earlier today, the SEC issued a Sunshine Act Notice, stating the commission will meet on Wed. July 14 at 10 am to:
consider whether to issue a concept release to solicit public comment as to whether the Commission should consider revisions to its rules to promote greater efficiency and transparency in the U.S. proxy system and enhance the accuracy and integrity of the shareholder vote.

The meeting will be open to observation by the public (bloggers, twitterers, et al, although maybe not Oprah, Ashton, or Larry King), but folks like, and legal and compliance bloggers will probably be following the commissioners' debate carefully, and the open commission meeting will also be webcast.

Readers new to the FEI blog, see also our earlier post about today's FEI Hall of Fame announcement.

FEI Announces 2010 Hall of Fame Inductees

Earlier today, Financial Executives International (FEI) issued a press release announcing the selection of FEI's 2010 Hall of Fame inductees: Karl M. von der Heyden, former Vice Chairman of the Board of Directors and Chief Financial Officer of PepsiCo, Inc., and Ulyesse J. LeGrange, retired Senior Vice President and Chief Financial Officer of ExxonMobil Corporation's U.S. Oil and Gas Operations.

As noted in the press release: "The FEI Hall of Fame [HOF] provides recognition to senior financial executives who have epitomized the performance, leadership and integrity of the most exemplary financial professionals throughout their careers and in doing so, have made significant contributions to the betterment of their respective organizations and to the finance profession as a whole."

This year's inductees will be formally honored during at the FEI HOF black-tie gala on Nov. 15, 2010 at the New York Palace. The program will be hosted by CNBC's Tyler Matisen. All proceeds from the 5th Annual HOF Gala benefit the work of Financial Executives Research Foundation (FERF) , the research affiliate of FEI. Additional information about the FEI HOF, including further background on this year's inductees, past inductees, and how to register to attend the black-tie gala, can be found at

FERF appreciates the support of Microsoft Corporation, premier sponsor of the HOF. Additional sponsorship opportunities are available, contact Lorna Raagas at or 973.765.1033 for info.

CFRI Is Coming!
The black-tie gala HOF induction ceremony, Nov. 15, 2010, is a separate event from FEI's well-known Current Financial Reporting Issues (CFRI) conference, slated to take place Nov. 15-16 at the Marriott Marquis Hotel in NYC; and each event (HOF and CFRI) requires separate registration and payment. The programs are scheduled during the same time period and city for the convenience of attendees interested in attending both programs.

Further info about this year's CFRI (speakers, agenda) will be posted as we get closer to the date. Past speakers have included SEC, FASB, IASB and PCAOB Chairmen, Commissioners, Board Members, and Senior Staff, and well-known business, finance, and economics news, and other commentators. Some highlights from last year's CFRI were posted last year here, here, here, and here, but there's nothing like being there in person, both to see the expressions on the faces of the speakers (including when some very high level people tell jokes! -- and their reactions to some of the questions during Q&A! -- plus no matter how comprehensive a set of notes you take or articles you read about the conference, it can't compare to hearing it all yourself, first-hand), and for the opportunity to network with other high level financial executives, members of their staff, and others (the program is open to non-FEI members at a higher registration rate). Potential new members: see Join FEI; past members can renew membership by logging in here.

Thursday, July 1, 2010

FASB, IASB Release 'Staff Draft' of Proposal on Financial Statement Presentation

In a special "Action Alert" issued earlier today, FASB and the IASB announced the release of a "Staff Draft" of their upcoming Exposure Draft of significant proposed changes to financial statements, as part of the Financial Statement Project.

The boards note in today's announcement that outreach activities they plan to issue the ED in early 2011, and plan to engage in the outreach activities during the next six months, focusing on two areas:

1. The perceived benefits and costs of the proposals
2. The implications of the proposals for financial reporting by financial services entities.

In particular, the staff plans to:
1. Ask users of financial statements to evaluate how the proposed changes to the organization of, and information presented in, financial statements would benefit their analysis and resource allocation decisions.
2. Ask preparers of financial statements to evaluate the effort and cost involved in adopting these proposed changes in their unique circumstances.
3. Meet with preparers and users of the financial statements of financial services entities to discuss the proposed changes.
4. Gather additional information about benefits and costs by doing more field work on the proposals in the staff draft, including additional field testing, experimental research, or both.

As to timing of release of the actual Exposure Draft (ED), FASB and the IASB say they expect to publish the Exposure Draft (ED) in early 2011.

While an "Staff Draft" is not a formal request for comment (as opposed to the release of a formal Exposure Draft or ED), today's FASB/IASB announcement adds:"While neither the FASB nor the IASB is formally inviting comments, they welcome input from interested parties.

Links to Staff Draft, Related Info
Introduction to the Staff Draft (9 pages)
Staff Draft of an Exposure Draft on Financial Statement Presentation (155 pages)