No more window dressing for banks

The recent financial meltdown driven primarily by the financial institutions has made the finance community and the standard setting authorities jittery. Lots of small banks and financial institutions were wiped out, but the one that raised a lot of eyebrows was the...

SOX- Finally some cost savings for smaller companies

In this economy where companies are cutting costs left and right, the SEC’s final rulemaking release on September 15, 2010 was a relief. The release eliminates the requirement for newly public companies and smaller public companies (i.e., non-accelerated filers...

XBRL Costs

A very interesting survey that I found today was the SEC survey related to XBRL. What intrigued me was the cost structure of the XBRL filing. The survey states that the first time filers with block text footnotes and schedules on an average require 125 hours, assuming...

KB Homes comes home happy

Finally an SEC investigation that did not lead to any enforcement action. After completing their investigation the SEC did not recommend any enforcement action for KB Homes. The SEC had launched a probe last year into possible accounting and disclosure violations by...

How to live lavishly on company funds!

What would you do with $30 million? Well Sujata Sachdeva, the VP of Finance and Principal Accounting Officer at Koss Corporation bought  designer clothes, furs, purses, shoes, jewelry, household furnishings, cars, did home improvement and renovations. The only...

To lease or not to lease

When a company leases a piece of equipment, it has two choices, either to report it on the Balance Sheet (capital lease) or not to report on Balance Sheet if it is an Operating Lease. The  International Accounting Standards Board (IASB) and America’s Financial...

KPMG Accounting Malpractice verdict

On August 26,2010;  a New Jersey appeals court found sufficient evidence that KPMG was negligent in its audits of the books of Papel Giftware Inc. KPMG audited the books of the ceramic company, the acquirer, Cast Art Industries LLC., and its financial backers relied...

Globalization and Accounting Fraud

While reading the big accounting fraud at Satyam,a company based in India, which got a lot of media coverage not only in India but also in the US, I realized that globalization is also a good policing methodology. Most of the earlier cases of reported accounting...

Dells dilemna

Another big company, same old story. To meet the street’s expectation, the company tried to cook its books. The allegation by SEC is that Dell met or beat the analysts’ earnings expectations by using a cookie jar reserve, from 2002 to 2006. Dell received...

Convergence vs Adoption

There is a lot of talk of the convergence project undertaken by Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB). But why is the convergence project and not the adoption project. Adoption would mean that the Securities...