Sunday, November 15, 2009

Google Alerts Never Takes a Day Off, So I Don't Either

I've neglected posting on 10KT for far too long so if nothing else, accept this as a token of my realization that this blog exists.

The one thing that has come about in my short time as a paid blogger (professional doesn't seem appropriate) is that I am overcome by the mass amount of emails that I receive on a daily basis. I receive so many that the mere idea of reading all them is an act in futility.

I should clarify that these are content related alerts that I receive from Google and not fan mail or hate email. The former being a delusion and the latter being suspiciously absent.

Google Alerts has easily become my best friend and my worst enemy all at the same time. Without this miracle of information, I would not be able to do my job, pure and simple. It provides me with some of the most bizarre stories that I post about it. Here's one that would not have been possible without Google Alerts.

At the same time, sometimes I wish Google Alerts would take a day off. Sadly, it never grows weary. Holidays, weekends, and snow days are all equal in the eyes of the almighty Google machine.

If my untimely passing were to occur, Google would never know and the unread emails in my inbox would grow, day after day, unless Google Alerts was able to reconcile my obituary with the email account and discontinue the service.

So I have to accept the fact that as long as I crave information for my work, Google will oblige without hesitation. I guess it beats the hell out of finding the stories myself. Sphere: Related Content

Sunday, October 4, 2009

Hacks vs. Flacks

Becoming a blogger has forced me into a brand new world of vernacular and day to day interaction with all different types of media.

"Hacks and flacks" is a dynamic that exists in media that I am increasingly involved with. Hacks, in the traditional sense, are news reporters producing work quickly on a regular basis. Woodward and Bernstein types.

In the increasingly online media world, it appears that bloggers have naturally found themselves included in this group, regardless of their lack of journalistic background.

When I was first deemed a 'hack' it was not in the complimentary sense and we'll just leave it at that. After that, I began to notice term more and more and that it was used by many writers/bloggers/journalists (mostly on Twitter) to self-identify themselves.

So I had to do some research to get to the bottom of this. Definitions of a hack, as it could be possibly be applied to my trade as a blogger are as follows, per Wiktionary:

• One who is professionally successful despite producing mediocre work.
• A talented writer-for-hire, paid to put others' thoughts into felicitous language.
• An untalented writer.
• A political agitator.

It could easily argued that definitions 2 and 4 do not apply since I'm most definitely not a 'writer-for-hire, paid to put others' thoughts into felicitous language'. I am a writer, already hired, putting my own thoughts into felicitous language for a tabloid.

Additionally, while I'm clearly an agitator, a political agitator is quite a stretch. I've gotten to the point where I've been self-identifying as as either a 'trouble-maker' or when I'm feel like engaging in some self-loathing, a 'gossip-mongering whore'.

When I hear 'political agitator', I think of anyone related to the Nixon White House or Karl Rove (who might as well have been part of the Nixon White House).

So that leaves us with: 'One who is professionally successful despite producing mediocre work' and 'an untalented writer'. Both of which are at the very least, arguable and at the very best, spot on. Hence, the case for my "hack" status is pretty solid.

The "flacks" I have dealt with have increasingly lukewarm to my "hack" status. Either that or they just don't like talking to me as it's pretty difficult to get anyone on the phone or to respond to my emails. The reasons for this aren't quite clear but I have my theories, which I won't get into here because, simply, I'm paranoid.

What's also interesting is that when I Googled 'Hacks & Flacks' or some derivative, most results indicate that a adversarial or competitive relationship exists between the two groups. This makes me realize that A) my experience is normal, and B) it's basically a game between two groups of people that have very different interests.

Flacks are very good at discussing and promoting good news for their company. They're not so excited about discussing bad or unflattering news for said company. Since good news doesn't really lend to very good gossip or tabloid material I naturally drift towards the 'bad news'. I guess should probably expect more stonewalling... Sphere: Related Content

Monday, September 7, 2009

10-key Tramp: Cheerleader

Since GC launched in July, I've found myself taking on different roles as an editor. The one that I definitely did not foresee but find myself getting odd enjoyment out of is that of cheerleader.

I feel as though I can never hype the site enough and that I enjoy talking about it and what we're trying to do. Perhaps that makes me a little egocentric but I can't tell people that I don't want to talk about it, can I? That wouldn't make me a very good cheerleader or barker

The fact of the matter is, that the more people that I coerce into joining the group on Facebook or following on Twitter, the better for the exposure of the site and the traffic numbers. "Viral" is the word I keep hearing. I'm not a big fan of buzzwords but this sums it up better than anything else I can come up with.

Strange thing is, that I find myself being obsessed with the number of people in the Facebook group and the number of followers we have on Twitter. Sometimes checking both multiple times a day and secretly high-fiving myself when we get a big jump in group members and followers. So, I find myself being totally okay with this shamelessness.

This is very much a strange feeling for me because I've never been one to get to excited about anything to the point of where I would voluntarily promote it let alone jump up and down to get people to come look at like a barker at Coney Island.

I had jobs at three different companies plus an internship but I never bought into the rah-rah aspect of corporate life that existed at any of them. Maybe that's why I'm no longer part of the corporate world...I'd much rather hype something I actually believe in. Like a freak show. Sphere: Related Content

Sunday, August 16, 2009

The Silver Lining to Nasty Comments

Things have been pretty fun over at Going Concern. It's never without its interesting moments and it's great to read the comments that are posted by readers both the praise and the hate.

The thing that I've found is that I can't really think too much about the hater comments during the day because I'm always in a race against the clock. Whatever is going on, I'm always trying to post as much material as possible in a day to see what works and what doesn't and to follow up on stuff that is working. With all that going on, I have very little time to think about Guest 9 @ 3:39 that called me a "huge dickbag".

There seems to be two types of nasty comments: 1) Nasty comments with legitimate criticism; and 2) Hater comments and I think I may have found the silver lining in both.

For type #1, most of the time there is an underlying critique that is expressed in a nasty way so I have to try and consider the writer's intent. I usually try to figure out the underlying criticism and if it is legitimate or not and forget that the comment started with "Caleb you dumbfuck". So nasty comments can be good but it's true, lots of them are just hater comments, which is fine, it comes with the territory.

And strangely enough, the silver lining in the hater comments is sharing with them with friends works as a great joke. When I share these nasty comments with friends, they start laughing so hard, that I can't help but laugh too. Laughing with friends is what's really important anyway and if it happens at my expense, well, then I'm okay with that. Sphere: Related Content

Monday, July 20, 2009

Thanks Everybody!

This is just a quick shout out to everyone that has kept up with this extremely obscure blog since its start last summer. It's been an exciting past three months as I have unexpectedly gone from extremely bitter bean counter to borderline workaholic blogger. Thanks to the two Davids at Breaking Media for giving me this exciting opportunity and thanks to Nick, our web developer who made the site look so awesome.

I want all of you that are readers of this blog to give honest feedback on Going Concern and the work we are doing there because it's really an outlet for all of you that work in the accounting and finance fields. I will continue to write here less mysteriously so that hopefully you will share without filters (hopefully constructively).

So, this is my mini-awards show moment: Thanks to the following people for their support: Re: The Auditors, Jr. Deputy Accountant, Razorback04, DailyAngst, MKraft, EdithO, Catch That?, all my NYC Peeps (too numerous to name), all my Mile High City Peeps (way too numerous to name), my SoCal Peeps (Krista & Matt, Jeff), and last but most certainly not least, all the Nebraska peeps. If I left you off, I apologize, I did my best. Let me hear about it at Going Concern!
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Readers! This announcement warrants your complete and undivided attention. I am happy to announce that today marks the launch date of Going Concern, an accounting and finance tabloid of which I am the founding editor.

Check out our press releases: MediaPost Publications and Talking Biz News

Going Concern will continue the tradition that we have built here at 10-key Tramp for the past year. The great folks at Breaking Media have blazed the trail in professional tabloid blogging and have decided that all of you in the accounting and finance need a site where you can find out all the latest news, gossip, rumors, that are occurring in your industry.

Going Concern will give us a bigger megaphone and I encourage all of you to share any information that you have with us there because we deeply care about all of you out there that are working in this demanding industry and we want to be a place for you to vent and share your thoughts and ideas about everything that is going on.

We need your help to make this blog be what you want it to be! You can send tips to and follow us at Twitter @going_concern.

Join us now and tell all you friends and colleagues!

Thanks for reading,


UPDATE 3:44 PM EST: Another press release at Media Bistro
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Friday, July 17, 2009

Review Comments | 07.17.09

  • KPMG Suggests Goodwill Writedowns Doubled in 2008 - "The 2008 wave of goodwill impairments provides yet another disturbing piece evidence of the value that’s being wrung out of companies as a result of the recession." [Compliance Week]
  • Companies Exasperate SEC Accounting Chief - "The Securities and Exchange Commission's new top accountant took a pair of swipes today at the corporate community, showing frustration over the response to two major accounting standards initiatives." Accountants are especially hilarious when they talk trash about each other. []
  • Wow Factor Added To Corporate Presentation - It was the scrolling text with the "choo-choo" sound effects. Gets 'em every time. [The Onion]
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How Does Your To-Do List Compare to That of the Goldman Sachs Spokesperson?

Apparently this was found in the trash outside of 85 Broad:

Courtesy of Reformed Broker via Clusterstock. What we really want to know is why "Imbed tracking chips in 1.2 billion Indians" not on the list? Sphere: Related Content

Madoff Auditor Pleads Not Guilty

Count us as surprised. After agreeing to not have the evidence against him reviewed by a grand jury, which led some (i.e. us, Bloomberg, others) to speculate that he would plead guilty, Bernie Madoff's auditor/alleged accomplice/number-maker-upper, David Friehling, plead not guilty today.


"[Friehling] entered a not guilty plea to securities fraud, aiding and abetting investment adviser fraud and four counts of filing false audit reports with the Securities and Exchange Commission. Mr. Friehling was originally charged in March. Assistant U.S. Attorney Lisa Baroni asked the court for the next hearing in the matter to be scheduled in 60 days to allow the parties to continue discussion of a possible disposition of the matter. The next hearing scheduled in the case is Oct. 1."

This really doesn't make a helluva lotta sense to us but whatevs. If dude is looking to roll the dice, who are we to say "you're an idiot"?

UPDATE 2:25 pm: Because it's Friday and we are intent on getting the party started early, we just so happened to ignore that the possibility of a "disposition of the matter". Our bad.

Madoff's Auditor Pleads Not Guilty [WSJ]
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Tchotchke Follow-up: What's with the KPMG Hand Gel?

A reader, a little late to the game, sent in another picture for our tchotchke contest from a few weeks back. Enjoy:

Look familiar? That's because this is our second submission of Radio Station hand gel. Which begs the obvious question: why the hell is KPMG handing out hand gel? Did Tim Flynn and the boys at the top determine that the touch of soft, creamy hands are the key to great client service? Was the constant high-fiving amongst team members driving many to complain of raw palms? Or perhaps, Bernie Madoff isn't the only one that enjoys a little rub 'n tug in the middle of a tough day?

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Yes, the PwC/Satyam Story is Still Out There

We haven't shared any new bad news on PwC (read: Satyam) since, GASP, Monday but thanks to Re: The Auditors, who we'll point out, is on this story like stink on a monkey, we've got some thoughts:

1. It appears that PwC has a serious gag order on external communication re: Satyam. PwC has not held a single press conference in India since the scandal broke back in January. This is dubious for several reasons as you'd think there would some statement by P. Dubs but as we and others have noted, because no one seems to GAF here in the States, there's probably no rush to call attention to the pachyderm. The bigwigs figure that playing dumb will work in the West until someone starts making noise.

2. India's regulators and Satyam are playing hardball - Understandably, India is not cool with what happened and especially not cool with PW India's lack of admitting "yeah, our bad". "India's Enron" isn't a terribly flattering turn of events for a country that had been kicking ass and taking names lately so regulators and Satyam themselves is going on the offensive. The market regulator has announced that it will fund lawsuits on behalf of investors against whomever it has to. Plus, a big "Fuck you PwC" occurred in Forbes India where the Chairman of Satyam that took over after the scandal is quoted as saying "PwC messed up big time" noting that they didn't apply elementary auditing procedures.

3. When the lawsuits start, PwC will deny 'til they die - When it was reported that PwC could be banned from auditing in India it sent out "internal communication" to all employees (um, email) basically summing up the following:
  • ICAI cannot ban the firm in India
  • ICAI does not have power to act against firms
  • Newspaper report on banning PW incorrect
  • ICAI can take action only against partners
  • Any action against partners a long process
  • PwC was not contacted by ICAI high powered committee
So it's pretty clear that when PwC does decide to join this party, they'll be coming out swinging. This "communication" seems to be laying the ground work internally to rally the troops because this will surely get worse before it gets better and they're going to want some people in their corner.

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Scoping | 07.17.09

  • GE second-quarter profits fall by 47% - "Earnings at NBC Universal were off by 41 per cent as advertising revenue plunged." No details on what CNBC's details were but they're part of team GE so a little bit of schadenfreude is in order here. []
  • Paging Ben Dover To Provide Taxpayer Funded Workplace Humor - We figured those Treasury guys were a lame bunch but this is ridiculous. [Zero Hedge]
  • D-day in Latvia - Note to Latvia: If you want to stay in the game, you better do what the overlords at the IMF say. [FT Alphaville]
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Thursday, July 16, 2009

Review Comments | 07.16.09

  • Sears Tower Changes Name - WTG Eddie Lampert. Just lost the name on the tallest building in the U.S. Top notch. [Business Week]
  • CBO Chief Criticizes Democrats' Health Reform Measures - "Instead of saving the federal government from fiscal catastrophe, the health reform measures being drafted by congressional Democrats would increase rather than reduce public spending on health care, potentially worsening an already bleak budget outlook, the director of the nonpartisan Congressional Budget Office said this morning." You mean spending more isn't a good idea? [Washington Post]
  • Goldman Sachs in Talks to Acquire Treasury Department - "In what some on Wall Street are calling the biggest blockbuster deal in the history of the financial sector, Goldman Sachs confirmed today that it was in talks to acquire the U.S. Department of the Treasury. According to Goldman spokesperson Jonathan Hestron, the merger between Goldman and the Treasury Department is 'a good fit' because 'they're in the business of printing money and so are we.'" [Borowitz Report]
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Better Hope those Treasury Dudes are Right

Bloomberg has some potential famous last words as CIT awaits its fate from its bondholders:
The U.S. spurning of CIT Group Inc.’s aid request suggests officials are betting they’ve fixed the financial system enough to withstand the bankruptcy of a mid-sized lender. “I hate to say this, but it was probably expendable,” said Dennis Santiago, chief executive officer of Institutional Risk Analytics, a Torrance, California, research firm that studies systemic risk. “It may have just missed the boat” on federal rescues, Santiago said. [Empahsis ours]
Doesn't mean people, ahem, and voters won't be pissed:
There will be “a lot of disruption and anger among voters, particularly among people who rely on firms such as CIT for funding,” said Sean Egan, head of Egan-Jones Ratings Co. in Haverford, Pennsylvania, which rates CIT below investment grade. “A major provider of capital in the middle market is likely to be out of business in the near future,” and investors will be concerned, at least in the “short run” about CIT, Egan said. [Emphasis ours]
See you on the other side.

Treasury Bets U.S. Financial System Can Weather CIT Collapse [Bloomberg] Sphere: Related Content

IASB Gets Some Backup Defending Their Turf Against France and Germany

Yesterday we brought up how some German and French insurance were less than cool with the new proposals put forth by the IASB that would make everybody's favorite valuation method, mark-to-market, pretty much mandatory on any investment that isn't a fixed income security (read: that's lots of stuff).

The Finance Ministers of those countries, on behalf of said insurance companies, decided to write a very cordial letter that probably went something like this:
We're writing to inform you that the proposals you put out totally suck and you need to move up the review process so they can write more letters that will reiterate how MTM sucks and we're going to continue to write to you about it until we get our way, goddamnit. I think you know how we deal with things in France when we don't get our way and Germany, well, we won't go there.
French and German Finance Ministers
Which caused the two professional accounting associations in Europe, the Institute of Chartered Accountants in English and Wales (ICAEW) and the Chartered Institute of Management Accountants (CIMA) to retort with:
Dear French and German Finance Ministers,
First: You guys are talking after the whole WWII thing? France, especially you...whatevs...
Second: BTFO of the IASB's biznass.
'Hands off the IASB,' say institutes [Accountancy Age] Sphere: Related Content

Hank Paulson Only Speaks the Truth: LIVE!

Due to a sketchy Internet connection we didn't live blog Hank "Lead Pipe" Paulson's testimony this morning. They just broke for lunch and plus HP will be "taking care of something". To get caught up on the big guy scaring the coveralls off Ken Lewis, go to DealBreaker.

UPDATE: Round 2.
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Silver Lining in the Recession: Follow-up on Crocs Edition

Many, many moons ago, we told you about the most hideous fashion creation ever, Crocs, receiving a going concern warning issued by their auditors.

Well now The Washington Post is putting the nail in the nail in rubber-foam coffin after publishing a eulogy-ish story for the company today and it won't be comforting for Crocs fans (which include former President GW Bush, who probably didn't do the company any favors by coming public with that fact).

Former unpopular presidents aside, the company has a growing inventory and a mountain of debt coming due in September and most see the end coming but it sounds like the company is in denial:
"The company's toast," said Damon Vickers, who manages an investment fund at Nine Points Capital Partners in Seattle. "They're zombie-ish. They're dead and they don't know it."
Ouch, not the zombie analogy! The story comes off a little sad but then we see someone wearing a fluorescent green pair and we're ready to dance on the grave again.

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We're A Lot Closer to "Big 3" Than "Big 5"

Reuters informs us that the Big 4 firms will likely continue their dominance of the audit market and thus perpetuate their very own version of the "vampire squid wrapped around the face of humanity"

From the sounds of the piece, at least it appears that the EU sees the problem that four firms dominating the market won't cut it:
The current financial crisis makes it vital that we have a truly sustainable audit market, and the consultation results published today provide valuable insight into problematic issues," EU Internal Market Commissioner Charlie McCreevy said in a statement.
So we'll interpret the phrase "truly sustainable audit market" as "four firms is not enough" because the "current financial crisis" could very well claim a victim that has KwaterhouseDeloitteYoung in the name. The Big 4 is cool with a little more competition but, not surprisingly, their solution is "let us do what we want do and if we mess up, things will still be cool":
"The existence of a liability cap which is proportionate to audit fees would remove one of the potential barriers to mid-tier companies wanting to penetrate the large-tier market," said Jeremy Jennings, chairman of the European Contact Group, which represents the world's six biggest auditors.
Proportionate to audit fees? Is this guy kidding? So even if a firm were botch the audit for every single audit client, they'd still be in business? The investment value lost in cases like Enron, WorldCom, et al. dwarfed the audit fees paid by those companies.

Liability caps will do very little except reduce their professional accountability and thus, make the large firms more bullet-proof and strengthen the stranglehold further. Same song and dance from the Big 4.

SIGH. There seems to be little hope for this particular oligopoly to foster any new competition until it's far too late. And with the piling litigation, often due to auditor complacency, that day of reckoning may be coming very soon.

Auditor ownership not top competition priority-EU [Reuters] Sphere: Related Content

Scoping | 07.16.09

  • CIT Says It Won’t Get More U.S. Aid - "The survival of one of the nation’s largest commercial lenders, the CIT Group, was thrown into doubt late Wednesday after federal officials rebuffed pleas to rescue the struggling company a second time." Has T. Geith drawn the line? [New York Times]
  • Sotomayor Hits Pro-Business Note as Senate Testimony Nears End [Bloomberg]
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Wednesday, July 15, 2009

Review Comments | 07.15.09

  • Ex-Goldman analyst, others accused of inside trades - "U.S. regulators on Wednesday filed civil charges for insider trading against 11 people, including a 26-year-old former Goldman Sachs Group Inc (GS.N) investment banking analyst accused of leaking confidential merger information to his brother." [Reuters]
  • Donald Trump’s Lawsuit Over His Net Worth Has Been Thrown Out - This is a relief. [Daily Intel]
  • CIT Trading Halted as Lender Awaits Word on U.S. Aid - Per CNBC, word of Tim Geithner caving should be known in 24 hours-ish [Bloomberg]
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Madoff "Auditor": Let's Get This Over With

Bernard Madoff’s accountant, David Friehling, accused of playing a role in the convicted money manager’s multibillion dollar fraud, agreed to waive an indictment, a signal that he may plead guilty. Federal prosecutors in New York filed a notice of intent today to file a criminal information in Manhattan federal court. The filing of such a document means Friehling has agreed that prosecutors need not present evidence against him to a grand jury.
Other suspected conspirators should probably take note.

Madoff Accountant Waives Indictment, May Plead Guilty [Bloomberg] Sphere: Related Content

Wild Speculation Wednesday: Ernst & Young Big Brother Edition

Because we don't feel like we spread enough paranoid delusional theories here, we're sharing this post we found at
It is surely the biggest Big Brother project yet conceived. India is to issue each of its 1.2 billion citizens, millions of whom live in remote villages and possess no documentary proof of existence, with cyber-age biometric identity cards. The Government in Delhi recently created the Unique Identification Authority, a new state department charged with the task of assigning every living Indian an exclusive number. It will also be responsible for gathering and electronically storing their personal details, at a predicted cost of at least £3 billion.
What's even better is that an Ernst & Young partner worked on one of the pilot "schemes" as the Times Online puts it. So obviously this causes us to speculate about the following:
  1. How involved is E&Y in this current plan to identify every single human being in India?
  2. Will they also secretly somehow implant tracking chips by issuing 10-key calculators to every person when the cards are issued?
  3. Will the Two-Minute Hate be directed at the other Big 4 firms?
  4. And the most obvious question: How is Goldman Sachs involved?
India to issue all 1.2 billion citizens with biometric ID cards [Times Online]

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The Panel Investigating the Financial Crisis Will Probably be a Painfully Boring Bunch

The Wall St. Journal has names for the Financial-Crisis Commission patterned after the Pecora Commission that investigated the causes of the Great Depression.

Unfortunately, this panel will not include the greatest financial mind of our time, Maxine Waters, which is a devastating turn of events because the banning of credit default swaps and dismantling of Goldman Sachs are absolutely crucial to fixing this economy.

The 21st Century version of the Wall St. rectal exam will instead be chaired by Phil Angelides, the former treasurer of California (which makes us pretty nervous considering how well Cali is doing) so we'll speculate that the main stream media will creatively come up with the name "The Angelides Commission".

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Wild Speculation Wednesday: KPMG All-Star Game Publicity Edition

We didn't watch MLB's All-Star Game last night but we did hear today that a bunch of bean counters are all abuzz about the KPMG logo being on the building in dead center field. Our initial reaction is: GET. A. LIFE. This is what you spend your morning talking about? Vomit.

In any case, we tried finding a pic on the web and this is best we found. Apparently it was in plain sight on the tube but again, we repeat, WGAF?

In our search for a picture of the building we noticed some older pictures where no Radio Station logo was present:

So our speculation is that when the announcement came out that the All-Star Game was coming to St. Louie did the Radio Station suddenly spring for the new sign? How many auditors/tax associates got the axe to pay for this? Could Phil Mickelson been paid an extra million for the cost of this sign? Just throwing it out there.
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Mark-to-Market Still Unpopular with Companies That Aren't Interested in Reality

Because we know that you were worried that the mark-to-market debate was dead...FEAR NOT. The IASB released proposed amendments to IAS 39 yesterday that will get more than a few companies bent out of shape. The first being French and German insurance companies that are threatening to dump asstons of securities if the amendments are passed.

The long/short of the amendments is that securities would be thrown into one of two groups. Group 1 would be marked-to-market, Group 2 would be held at amortized cost (English Translation: what you paid for it less periodic non-cash reductions).

SHOCKER: the insurance companies don't like Group 1. John Carney at Clusterstock provides the details on the insurance companies' temper tantrum argument:
The German insurers have said this rule would require them to dump the stocks they hold in their portfolio, since the effects of market volatility on their capital position would be unbearable. So far the finance ministers of Germany and France support the insurers, who are calling for softer, more flexible rules. The European Commission is reportedly supporting the IASB.

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Scoping | 07.15.09

  • Regulators Near Deal on Package to Save CIT - "CIT Group Inc. and federal regulators were working to iron out details of an aid package Tuesday night after customers drained hundreds of millions of dollars from the lender, according to people familiar with the matter." Bailouts are soooo in still. [WSJ]
  • Raters Sued by Calpers Over Losses - "Calpers filed a lawsuit against the three biggest credit-ratings agencies, accusing them of issuing "wildly inaccurate and unreasonably high" ratings on structured investment vehicles that saddled the California pension fund with at least hundreds of millions of dollars in losses." [WSJ]
  • AIG Unit Sells Loans for as Much as $975 Million - Only about a gazillion dollars left to pay us back! FTW AIG! [Bloomberg]
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Tuesday, July 14, 2009

Review Comments | 07.14.09: Bernie Madoff Reports to Jail Edition

  • Keep It Simple - "The International Accounting Standards Board today put out an exposure draft on classification and measurement in financial instruments, and I was impressed by its relative simplicity." Mostly to spite the rival FASB, we thinks. [Floyd Norris/NYT]
  • Who Wants To Be A (Baked) CEO? - Show of hands for those of you that are already baked CEO's. Ahem, Jimmy Cayne. [DealBreaker]
  • Madoff Sent to N.C. Prison to Begin 150-Year Sentence - The picture at left is our best guess as to what the Master Ponz might look like in the joint. [Bloomberg]
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Ernst & Young Still Not Losing Sleep Over the Schein Lawsuit

Ernst & Young has the unenviable distinction being the large firm that has a major trial ongoing. We mentioned it awhile back, noting that while E&Y has got plenty of lawsuits to worry about, this one didn't seem like anything to sweat over.

Well, an E&Y witness has given our theory a little boost, stating that a type of the loan created by the Plaintiff, Alan Schein, and marketed by the failed bank, was "deceptive and predatory". Not exactly a flattering description.

Regardless of what E&Y did or did not do (and they've already paid fines to settle claims by regulators so they've got, at the very least, a smidge of guilt) the jury hearing "deceptive and predatory" in the same sentence as the plaintiff will go much farther than any Zapruder Film-type evidence that Schein might dig up.

Superior Bank Peddled Risky Loans, Ernst & Young Witness Says [Bloomberg] Sphere: Related Content

PCAOB Continues Sadistic Treatment of Accounting Firms' Audits: BDO Edition

Earlier we gave you the lowdown on Good Grant Thornton Times courtesy of the PCAOB. As promised, we're back with the OB's inspection report on everyone's favorite Teflon firm, BDO.

According to CFO, BDO's main problems appear to be with documentation and actually doing work, "According to the reports, the shortcomings were usually based on a lack of documentation and persuasive evidence to back up audit opinions."

Translation: Basically BDO may or may not have actually done the work they said they did but didn't bother creating workpapers that show that they actually did the work. The PCAOB is not down with just an auditor's good word.

Some poor audit associate probably spent 36 straight hours of auditing but didn't bother creating the workpaper. And, similar to the GT case, the managers and partners were apparently still cool with it.

There are other situations where the Peek-at-Boobs thought that BDO just decided they weren't going to do the work including "channel stuffing" and misstatements due to possible fraud (not really a problem these days anyway).

BDO took the criticism better than GT though, saying, "an inherent part of our audit practice involves continuous improvement." They figured that they were pushing their luck after dodging the Banco Espirito bullet.
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Someone Please Tell the BBC That They're Getting Bamboozled

In what may be a blatant case of taking advantage of a client's cluelessness about what professional fees cost, KPMG raised its audit and other service fees 30% on the BBC from the prior year fees. Apparently we'll be the first to notify the BBC of this fact: 30% IS A LOT.

We're guessing the accounting staff at the BBC is a less-than motivated bunch leading some extra work for the KPMG minions but still....30%?

Maybe the partners on the engagement were photo-copying the phone book, maybe the engagement team was drinking on the clock and running the tabs through but somehow a 30% increase occurred and a bunch of Carl Kassel-types (with British accents, obv) bought whatever the Radio Station explanation happened to be.

KPMG scoops 30% more fees from BBC [Accountancy Age]

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Because This is How We Get Things Done in France

FT Alphaville:

Workers at a failed French car parts supplier are threatening to blow up their factory unless the company’s two biggest clients - Renault and PSA Peugeot Citroen - stump up extra compensation, the FT reported. Employees of the engine parts maker New Fabris have rigged up a series of gas canisters inside a factory workshop which they say will be detonated on July 31 if the two carmakers fail to pay €30,000 to each of the 366 workers facing unemployment.
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PCAOB Continues Sadistic Treatment of Accounting Firms' Audits

Since none of you decided to spend your weekend reading and reporting on the PCAOB inspection reports on Grant Thornton and BDO, we had rely on CFO to give us the gory details.

We'll give you the skinny on G to the T first and we'll hit BDO later.

Deficiencies highlighted in the inspection report on Grant Thornton, meanwhile, included failures to "identify or appropriately address errors" in clients' application of GAAP. In addition, inadequacies were said to have been found with respect to performing necessary audit procedures, or lacking adequate evidence to support audit opinions.
Tramp Interpretation: With regard to "identify or appropriately address errors", it appears that GT doesn't know their GAAP or they haven't found any effective passive-aggressive methods of informing their clients that they don't know how to apply GAAP.

Regarding "inadequacies...performing necessary audit procedures or lacking adequate evidence to support audit opinions": staff on the engagement didn't understand what they were supposed to do, or they attempted to do something and did it half-assed. Managers and partners on the engagement were apparently okay with that.

Grant Thornton responded to the report with a written response that included the following:
"While we believe that the PCAOB should continue to challenge judgments and documentation during the inspection process, we do not believe that, in the end, reasonable judgments should be criticized and second guessed. Such a process will ultimately lead to inefficient audits due to the fear of unnecessary criticism."
Tramp Interpretation: We are much smarter than you. We are very sensitive and don't like being questioned. This oversight business isn't really for us. We suggest that it be done away with.
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Scoping | 07.14.09

  • Senate Panel Set To Grill Sotomayor - For a great live blog covering the Republican Senators grasping at straws, go to Above The Law [NPR]
  • Goldman Reports Big Profit, Beating Forecasts - BO-NUS! BO-NUS! BO-NUS! [New York Times]
  • Bank rescues 'wrong thing to do' - So sayeth Jim Rogers but then... "now that the banks have had their state aid and are turning around their fortunes, Mr Rogers said the public should get behind them." "The public" obv excludes Jim Rogers. [BBC]
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Monday, July 13, 2009

Review Comments | 07.13.09

  • Stanford Victims Go After Entire Nation - Accusing the whole nation of being complicit in the fraud is really that much of a stretch so the Stanford dupees musta figured, "Why the hell not?" [DealBreaker]
  • UK CFOs Think Things Will Get Better, But Better Still Sucks [Clusterstock]
  • Investor values Facebook common stock at $6.5 billion - Zuckerberg status set to "Cha-ching" [Reuters]
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PwC Probably Needs a Hug

As we mentioned this morning, the majority of PwC news has been extremely bad lately. And since it's Monday, we'll continue to kick a big multi-billion dollar professional services firm while they're down.

The Institute of Chartered Accountants of India ("ICAI"), the country's accounting regulator, may recommend the blacklisting of the firm. This awakening of the ICAI's inner-Joe McCarthy would mean that P. Dubs would be barred from performing audits in India.

Since the ICAI can only recommend the blacklist, P. Dubs would be able to appeal the action in court but since all of the Big 4 have hard-ons for doing business in India these days we can assume that this is another not-so-good development for the firm.

ICAI may push Price Waterhouse into blacklist zone [The Economic Times]

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Because All Work and No Play Makes Barney Frank a Dull Boy

No one gets things done (especially torpedoing accounting rules) like the Sass from Mass, so it's great to see the big guy getting some fun over the weekend. Go to DealBreaker for another pic and some commentary. Sphere: Related Content

Looks Like Someone Is Finally Listening to Us.

Since we're in the midst of a slow day, we're pulling one from Scoping. Just a few more opining on the whole delay in the IRS/UBS trial that was supposed start today.

Judge Alan Gold is giving the parties three weeks to make nice and on July 29 will hold a conference call where the parties will either announce the number of Toblerones to be transferred or whether the parties will battle it out.

The delay kinda-sorta indicates that UBS wants to settle but not because it would be painless. The whole sitch has not been good for You and Us, as if any settlement is reached, they're likely going to be forking over a metric asston of cash. And since the IRS will likely to argue that these individuals (read: not poor people) haven't been paying taxes on their offshore assets for eternity, the payment will similar, if not greater than the $780 million paid by UBS earlier this year.

Then there have been the reports of the bank losing business because of the negative exposure and there's the whole, we're a Swiss Bank, we're super-secret image. Yeah, probably not so much any more.

On top of all that, the other trub that UBS will have is that the U.S. case is just the beginning. Other governments want their rich clients with offshore accounts paying back taxes too. What happens with in the U.S. will ultimately serve as a jumping off point for other courts to rule in a similar fashion.

So this all adds up to a lose-lose-lose-lose-lose for the Swiss Bank. So this is where we have to say: The "You and Us" talk better stop, UBS, cuz unless you got a turd in your pocket, it's just going to be YOU on this one.

U.S. trial delay seen bringing UBS tax deal nearer [Reuters]

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At the Very Least, a Few People at PwC are Bigots

P. Dubya has had a couple of weeks. The Satyam story is not going away, interns in New York are rumored to be getting whip, and the firm has been pegged by the Somalian "Government" to take on a super-fun new project that will probably result in at least one bean counter death.

So now, because bad times aren't really bad times unless you're accused of bigotry, a former employee has filed a GBP 40 million lawsuit against the firm:
Mihaela Popa alleges she was the victim of racist bullying and was repeatedly ignored for promotion throughout the time she was employed by PricewaterhouseCoopers (PwC) in London.
The 31-year-old says she was asked to do menial tasks such as filing while her less-qualified British colleagues were given more challenging jobs.
Can't say that this comes as a surprise re: the menial tasks for a "transfer" from another country. The typical modus operandi in the Big 4 seems to be that if you come from another office, as in the case, you're automatically branded as an idiot who is completely incapable of any task that doesn't involve using a copy machine. But this particular case gets a little more interesting:
Miss Popa claims she was made to feel like a prostitute because she came from Eastern Europe and that colleagues, including senior managers, responded to her questions by making sexual innuendoes.
Miss Popa also claims that during an office discussion about an outbreak of bird flu in Romania, one male member of staff pointed at her and said "this Romanian bird will have a slow death"
P. Dubya sure picks some charming fellows over there to work in the UK. Truth be told, the treatment in the States would probably be similar since the majority of Big 4 management teams (i.e. manager and above) in are filled with man-babies.

It's also worth mentioning that all the firms make a big push to celebrate their "diversity". This is pretty hard to take seriously when shit like this happens.

Oh, and just in case you think it's isolated, it's most certainly not. You rarely hear anything regarding harassment in these firms but everyone knows that it is ubiquitous. Work there for 6 months and you're likely to hear a story or witness at the very least borderline behavior.

We'll continue to follow this story as it moves along.

PricewaterhouseCoopers hit by racism claim [The Telegraph via Accountancy Age]

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Scoping | 07.13.09

  • Executive stress a boon for island rehab - Corporate executives get to hang with Amy Winehouse when things get out of control. Unless of course, they said "no, no, no". [BBC]
  • Chicago Cubs Bankruptcy Looms as Way to Finish Sale by Tribune - "The Chicago Cubs may become the first Major League Baseball team in 39 years to file for bankruptcy as Tribune Co. seeks to sell the franchise after months of negotiations." [Bloomberg]
  • U.S. judge approves delay sought in UBS tax case - "A U.S. judge agreed on Monday to delay the start of a trial in which U.S. tax authorities hoped to force UBS AG to reveal the identities of thousands of Americans suspected of using the bank to evade taxes." Rumor is that maybe a settlement is being reached re: some Toblerones, which as you know, we've been advocating for some time. [Reuters]
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Friday, July 10, 2009

PCAOB Releases Grant Thornton and BDO Seidman Inspection Reports

Light reading for the weekend:

Grant Thornton


Everyone owes 500 words for each firm by Monday morning. We'll address here at some point. The weekend is getting started early so don't expect it to be today. Sphere: Related Content

Ex-BDO Partner to Might Go Directly to Jail


"Robert Greisman, 58, of Deerfield, Ill., pleaded guilty in United States District Court in Manhattan. He is the fourth tax partner at BDO Seidman, the accounting and consulting firm, to plead guilty in connection with a federal investigation of tax shelters."

Sentencing on Oct. 23.

As you were.

Ex-Partner at Tax Firm Pleads Guilty in Shelter Case [DealBook/NYT] Sphere: Related Content

Thursday, July 9, 2009

Tramp After Hours: Beard Reaching Out to the People Edition

This post has a couple of purposes:

1. To announce that Tramp will have a slow day tomorrow due to some traveling. Posts will occur as allowable.

2. According to a post on Business Week, B squared is going to holding town hall meetings in Kansas City on July 26.

Fed Statement:
Federal Reserve Board Chairman Ben S. Bernanke will participate in an hour-long town hall-type meeting with local citizens at 7 p.m. EDT (6 p.m. CDT) on Sunday, July 26 at the Federal Reserve Bank of Kansas City, 1 Memorial Drive, Kansas City, Mo. The event will be moderated by Jim Lehrer, anchor and executive editor of The NewsHour with Jim Lehrer.
Well well well. Is Ben doing a little campaigning for himself to keep the job as Chief Money-Money Man? Be far from us here at Tramp to speculate about why all the transparency, but we'll give it a shot:

BEARD (interior monologue): A certain someone that has the same initials as body odor is all about the transparency...this might be a good move, because he's pretty good at those town halls and then we'd have something to talk about other than how Tim has probably never gotten laid since he's been in DC and the girls here are easy...and I'm from the South. I can do this. I'm folksy. Missouri-types will like me. They're a folksy bunch too.

But also a certain other someone has decided that he's not wearing socks anymore and he's getting a little too comfortable thinking he can just waltz in after being at that geekshop DE Shaw and Harvard and start running things because he didn't have to deal with Paulson and C-3P0-John Thain and Ken Lewis calling at 3 am completely smashed going on about how no one in New York likes him and W...don't get me started....

Fed Chair Bernanke to Hold Town Hall on Economy [Business Week] Sphere: Related Content

Review Comments | 07.09.09

  • N.Y. Senate Democrats Reclaim Majority, End Deadlock - Back to getting nothing done! FTW Albany! [Bloomberg]
  • Judge refuses to delay sale of GM - Basically it's the past of least resistance considering how the whole Chrysler thing went. [BBC]
  • Thousands Defy Authorities and Protest in Iran [WSJ]
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Anyone Heard of Bebo? Anyone?

AOL, which is slowly going the way of the Dodo, is dumping some assets as it is being meticulously hacked away from Time Warner.

One little gem that AOL is hanging onto, however, is Bebo, its social networking site. WHAT? You've never heard of it either? So the honor by Business Week as "the worst of the worst" for mergers & acquisitions is pretty much right on the money.

"[CEO Tim] Armstrong told Reuters on Thursday that Bebo still has "great value" and that it will be moved to a Ventures unit of the online company so that work can be done to improve the site."

Sorry, did you say the venture unit of FAIL? Just wondering.

AOL reviewing assets, but will likely keep Bebo [Reuters] Sphere: Related Content

Madoff Attorney: Let's Get This Thing Over With. One Year at a Time

Imprisoned fraudster Bernard Madoff has decided not to appeal against his 150-year sentence, his lawyer has said. "We are not going to be appealing," Madoff's lawyer Ira Lee Sorkin said. "That's our decision and we have no further comment."
Nothing? Like dropping suggestions for Ruth's new crib? "Ruth should really look in Brooklyn for a nice two bedroom " or "She should really wait to see if Bernie ends up in Otisville. Then she could move upstate which would be way more convenient for the conjugals."

Madoff accepts 150-year sentence [BBC] Sphere: Related Content

Judge Wants Hints to How Ugly the IRS Will Make this Naming Names Thing

We're beating this drum until something gets accomplished:


The judge in the UBS/IRS case now wants to know, just for the sake of argument, how down and dirty the IRS will get if he rules in the Service's favor and UBS doesn't name names.
Alan Gold, the US district judge presiding over the case, late on Wednesday gave the US government until midday US time on Sunday to clarify whether it might go as far as seizing assets of the bank’s US operations, or forcing them into receivership, should the court rule against UBS and the bank not comply.
Gold also was curious to know if the Feds had considered double-secret probation and counsel replied that "all options are on the table".

It's becoming apparent that the Swiss are getting tired of "you're aiding tax evaders" talk out of DC because now they're pulling the pot/kettle card:
Swiss critics have accused the US of hyprocrisy in moralising on tax evasion. Many have noted the irony that next week’s case will be heard in Miami, an established offshore centre for the – possibly undeclared – assets of thousands of rich South Americans.
The IRS replied awkwardly with, "SO? SO? It's not that ironic"

Judge calls on US to clarify position on UBS [] Sphere: Related Content

Tell Us How You Really Feel: Goldman Sachs/Tim Geithner Conspiracy Edition

We'd like to give Maxine Waters credit for spawning the whole Goldman Sachs-running the universe conspiracy theory but we simply can't give her credit for a number of reasons that we won't get into here (okay, one: she's incapable of forming a coherent sentence).

Matt Taibbi is getting lots of attention for his "vampire squid on the face of America" analogy etc. etc. Hyperbole? Poss.

But when you have old Reagan soldiers calling you out...hard to thing gaining real traction? Is Maxine Waters a benefactor of "better to be lucky than good"? We won't believe it...

Former US Assistant Secretary Of The Treasury: "Geithner Works For Goldman" [Zero Hedge] Sphere: Related Content

Scoping | 07.09.09

  • Opponents of GM sale face noon deadline - "Those opposing General Motors' plan to sell the bulk of itself to a new government-controlled company face a noon deadline to file appeals and find a way to get the sale halted." After that the opponents will be deemed unpatriotic speculators and the plan will move along without further incident. [AP via Miami Herald]
  • White House Ponders Bernanke's Future - New blood (read: Larry "Sleeping Beauty" Summers) or keep on keepin' on with the Beard? There are other contenders too but that's boring. [WSJ]
  • AIG May Have Zero Value After Rescue, Citigroup Says - “'Our valuation includes a 70 percent chance that the equity at AIG is zero,' said Joshua Shanker, an analyst at Citigroup, in a note to investors late yesterday cutting his price target on the New York-based insurer by more than half." So what you're saying is that there is 30% chance that equity is not zero? Some might just take that action. [Bloomberg]
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Wednesday, July 8, 2009

Review Comments | 07.08.09

  • Head of SEC Office That Examined Madoff Stepping Down - Appears that M. Schape is cleaning house. [Washington Post]
  • AT&T: Wireless Industry "A Model" of Competitiveness [Business Week]
  • Group Wants California To Smoke Its Way Back To Financial Health - A good idea is a good idea [DealBreaker]
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Sky Capital Chief is a Typical Wall St. Guy

We were going to leave the Sky Capital story alone but self-appointed nicknames have always begged to be a point of ridicule and this is no exception. Apparently the Sky Capital honcho, Ross Mandell, referred to himself as "The Chuck Bass Bad Boy of Wall St.".

Two points:

1. Real original, Ross

2. Remember Costanza giving himself the nickname "T-Bone"? Went over well didn't it?

According to the FT, here is Ross "T-Bone" Mandell's bad boy resume:
During the 1980s and 1990s, he had a series of run-ins with US securities regulators, including the National Association of Securities Dealers, the forerunner to Finra.

In 1995, he was given a six-week suspension from securities dealing after numerous customer complaints prompted an investigation by the New York Stock Exchange, records show.

Two years later, he settled a separate matter with a disgruntled client by paying $75,000.

In an interview with the New York Sun in 2005, Mr Mandell said he had been an alcoholic and addicted to cocaine. “I lived hard and played hard,” he told the Sun. “I treated my friends, business associates and clients quite badly.”
Recap: Regulators beating on your door, friends, clients and co-workers hated you, you got suspended briefly and were a boozehound with a coke problem (or is it a cokehead with an alcohol problem?).

Count us unimpressed. Bored even. Has anyone ever heard of broker that was investigated, despised by clients and had dependency issues? You just described Bud Fox. Get back to us when you rip off Kevin Bacon or Muammar Gaddafi.

Sky Capital chief called himself ‘bad boy of Wall St’ []

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Stanford Employee Pleads Not Guilty to Arthur Andersen-esque Charges

"Thanks for the solid Bruce. Big Stan won't forget it"

An employee of the Fort Lauderdale office of Stanford Financial Group has plead not guilty to the destruction of documents. His attorney stating that Bruce Perraud will "clear it up". That's a relief.

The SEC has alleged that Perraud, "had a document-shredding company destroy a 95-gallon bin full of papers on Feb. 25, just days after the judge presiding over the SEC case had issued an order forbidding the alteration, removal or destruction of Stanford Financial records."

Clearing up why 95 gallons of paper being destroyed should be snap, just after Perraud pieces back together all the documents.
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KPMG Might Be Trying to Pick a Fight

The Radio Station came out with some fighting words in a report entitled, Focus on Transparency, regarding banks and how they haven't quit sucking at financial reporting.

They didn't waste their time naming measly players either. To wit:

"Investment banks, including Goldman Sachs (NYSE:GS) and Barclays Capital (LON:BARC) were in particular accused of inventing schemes to reduce their capital costs in the latest sign that financial market innovation is far from dead."

Color us shocked if Goldman and Barclays give a rat crap what the House of Klynveld thinks about their reporting but we suppose ten points can go to them for calling out some heavy hitters.

KPMG slams bank annual reporting [Director of Finance Online]

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Wild Speculation Wednesday, PwC Taskmaster Edition

We heard a rumor that tax interns at the PwC office in New York are working 60+ hours a week right now. Not sure if that's what any of co-eds really signed up for but hey, you were going to find out sooner or later. Plus getting paid per hour probably helps soften the blow

However, we also heard that interns weren't receiving overtime but we later found out that was bunk. We'll take confirmation either way...The speculation would be that if P. Dubs is cutting out the overtime, they've def sunk to a new low.
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Scoping | 07.08.09

  • Government Agencies, Washington Post Targeted in Cyberattack - "A widespread and coordinated cyberattack during the past few days has targeted Web sites operated by major government agencies, including the departments of Homeland Security and Defense, the Federal Aviation Administration and the Federal Trade Commission, according to several computer security researchers." Websites operated by the Nasdaq and NYSE were also attacked. Comforting. [Washington Post]
  • Old Merrill Quickly Disappears Inside BofA - "Merrill Lynch & Co. spent decades building one of Wall Street's premier investment banks. Undoing that work has taken just months." [WSJ]
  • Google Plans a PC Operating System - "In a direct challenge to Microsoft, Google announced late Tuesday that it is developing an operating system for PCs that is tied to its Chrome Web browser." Diabolical Google! We've got a geek (computer version) war! [New York Times]
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Tuesday, July 7, 2009

Review Comments | 07.07.09

  • Libya invested at least $500m with Stanford - Since U.S./Libya relations have just recently normalized in the last three years or so, Gaddafi probably isn't to keen on due diligence on American biz that involves certificates of deposit that pay 8% []
  • IRS Suspends Penalty Collections Against Some Small Businesses - "The Internal Revenue Service said it will suspend through Sept. 30 efforts to collect penalties assessed against certain small business owners, after key lawmakers said the penalties were more punitive than Congress intended." [WSJ]
  • Wall Street hits 10-week low amid talk of new stimulus - "Socks [sic] fell to their lowest level in 10 weeks on Tuesday as talk of a second government stimulus plan heightened fears that the economy is not yet on the path to recovery and that the corporate earnings season starting this week will be weak." [Reuters]
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More Bad News for AIG

We haven't reported on the whole Hank Greenberg/AIG trial but we thought we'd at least let you know that AIG lost. This after AIG claimed that Greenberg was a liar, liar pants on fire. Jury musta figured no sympathy was due to a company that nearly destroyed life as we know it.

Carry on...

Jury Finds Against A.I.G. in Greenberg Case [New York Times]
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PwC Draws the Short Straw

It's bad enough that P. Dubya has got this whole Satyam mess going on but now this?

The Financial Times is reporting that P. Dubs has taken up the suicide mission task of monitoring aid being sent into Somalia.
PwC, the world’s biggest accountancy firm, is making a move into the world’s worst failed state. Somalia’s interim government has asked PwC to bring bookkeeping discipline to a country where lawlessness has reigned for nearly two decades.
Not sure what compelled PwC to take on this particular task, perhaps its the undying commitment to being the utmost Global Corporate Citizen, perhaps its potential fulfillment of some partners' life-long dream to become pirates. WTFK?

Based on the FT's story, it could be that P. Dubs is just plain a-okay with the highway to the danger zone, "PwC has undertaken similar work monitoring donor payments in Afghanistan and Sudan. It declined to discuss details of the Somalia project, citing client confidentiality and security issues."

Sounds like PwC has already got spies working for them and just don't tell the whole universe, like some firms.

Oh, and there is money involved. The firm will "receive a commission of between 2 per cent and 4 per cent on all funds that reach their intended destination." The most recent aid pledge of $67M would get P. Dubya a commission in the nabe of $1.3M.

So it's not a total loss. The over/under on kidnapped/murdered employees will prob be two? Maybe three?

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We've Been Out-Snarked

We here at 10-key Tramp consider ourselves to be a snarky bunch. It's just our nature, so we run with it. We'll poke fun, often in a mean-spirited fashion, at those who are deserving (SEC, KPMG, PCAOB, PwC, Maxine Waters [you're always #1 to us]).

Well, Dennis Howlett, at AccMan, just raised the bar with this awesome headline:
AccountancyAge, The Guardian: you’re a bunch of douche bags
And a little taste:
Here’s the bottom line on this mess. If PWC’s Indian ‘associates’ were involved with consulting arrangements then PWC should have recused itself from any audit activity. Let’s give them a break and assume they were free and clear. How the heck did the audit partners manage to miss $1 bn (roughly) cash that Satyam’s CEO admits went missing? The answer is a simple fraud I learned about the first six months I was training. Rule no.1: seek independent proof of cash balances. So if PWC…errr…Lovelock & Lewes…err who the heck? missed that then they were either monumentally stupid (ergo fiscally liable) or…I don’t know what.
First: Bravo, DH.

Now after you finish laughing, go ahead and read the whole post because he makes his case. The coverage in the UK has been taking PwC at its lame PR word re: Satyam. We didn't even report their coverage here because it basically looked like they did the copy and paste technique right out of the press release.

Meanwhile, the coverage in the states has been, at the very least, sympathetic, and the typical all that's fit to print mantra courtesy of the NYT.

So the point is, the coverage on this whole story is at its worst, pathetic, and at its best, typical. The repercussions of this fraud are serious and as DH points out, the accounting profession is in a serious downward spiral. The "best" firms continue to prove that they are totally complacent about their "responsibilities" due to their arrogant oligopolistic stranglehold on the profession.

Smaller and second-tier firms, meanwhile, could be shitting gold bricks for their clients (and some probably do) and no one would notice (unless, of course, they screw up; that's you, BDO).

Somehow we've channeled some Dennis's rage over here...

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That's Right, We'll Shrink Wrap Your House

So Clusterstock introduces us to Fast Wrap, an "asset protection" company that has set up a franchise in South Florida that is shrink wrapping unwanted condos. Considering the fact that South Florida is foreclosure ground zero it's probably a big money maker but what the hell happens when if the real estate market recovers?

Are buyers really going to walk up to a shrink wrapped house with their brokers, cut through the six inches of plastic with a utility knife, and then take a look around?

Anyone with more common sense than, say, the average American home buyer will take one look and say, "yeah, it's still a shitty condo".

Did we say "more common sense that the average American home buyer"? Hmmmm, maybe we'll get some franchise info.

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Scoping | 07.07.09

  • Oil, Gas Market Speculation May Face Restrictions by U.S. CFTC - Yet another case of members of Congress getting involved in something they have virtually no understanding of. [Bloomberg]
  • U.S. consumer loan, card delinquencies set records - "Soaring U.S. unemployment and a shrinking economy drove delinquencies on credit card debt to an all-time high in the first quarter as a record number of cash-strapped consumers fell behind on their bills." - Are ya callin' me a deadbeat? Are ya? [Reuters]
  • U.S. Says It Still Lacks Many UBS Account Names - Look UBS, Amanda Hugankiss and Hugh Jazz just aren't going to work for the IRS. [DealBook/NYT]
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Monday, July 6, 2009

Review Comments | 07.06.09

  • DOJ Opens Review of Telecom Industry -"The Department of Justice has begun an initial review to determine whether large U.S. telecom companies such as AT&T Inc. and Verizon Communications Inc. have abused the market power they've amassed in recent years, according to people familiar with the matter." [WSJ]
  • Bail set at $750,000 for ex-Goldman programer - "A former Goldman Sachs Group Inc computer programer accused of stealing secret trading codes from the financial firm was being held in federal custody on Monday, pending the posting of $750,000 bail." [Reuters]
  • Scores Die in Ethnic Clashes in Western China - [Washington Post]
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