Welcome to...
NewsQuick Flip Edition
March 25, 2013
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In This Issue Member Events In the News SEC Update by Andy Bishop, CPA CPE and Webinars
Welcome to the first ever NewsQuick Flip Edition. The COCPA
developed this publication to better deliver up-to-the-minute, indepth articles to members. You’ll still find everything you’re used to seeing in NewsQuick here, it will just look a little different.
How to Read and Interact • Click the arrows to the left and right to flip pages. • Click the page itself to zoom in and out. • Mouse over the page to see all the clickable areas of the page highlighted in blue. Events, CPE, contact information, and web addresses will all open for you in a new window or tab.
Member Events Member Events
COCPA Executive Happy Hour
Thursday April 25, 2013 5:30 p.m. to 8:30 p.m. Blake Street Tavern 2301 Blake St. Denver
NO FEE TO ATTEND Complimentary appetizers and One free drink ticket each!
Key Issues Facing Boards of Directors
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Thursday April 25, 2013 10:30 a.m. (8:00 a.m. registration) University of Denver Sturm College of Law Ricketson Law Building, Room 165 2255 East Evans Ave., Denver
NO FEE TO ATTEND Continental breakfast will be served.
In the... Fraudulent Party Claiming to be Government Agency
The Colorado Department of Revenue would like to alert taxpayers and tax professionals of a possible telephone scam from a party fraudulently representing themselves as a government agency. The caller will identify themselves as “Tax Crime Investigation Department.” They will state that you may have a “warrant out for your arrest because of your tax crimes; failure to file taxes; or failure to remit taxes.” They will also claim that to avoid being charged with a tax crime you will need to wire them a large sum of money. READ MORE
4 Ways to Avoid Becoming a Micromanager Trying to curb your tendency to micromanage? Here are four tips to help you and your employees stop micromanaging before it starts. READ MORE
Colorado Revenue Continues To Grow Colorado’s economy continues to outperform expectations, spurred on by tax revenue from stock sales, although unemployment remains high, state economists told lawmakers. READ MORE
Corporate Auditors Will See Higher Budgets, More Spending on Tech Two separate studies point to increased budgets for corporate auditors this year and their plans to use the extra funds to beef up analytical and information technology skills. The surveys, from the 2013 State of the Internal Audit Profession study from PricewaterhouseCoopers as well as the Institute of Internal Auditors, conclude that technology can improve audit quality. READ MORE
The Ideal Praise-to-Criticism Ratio Which is more effective in improving team performance: using positive feedback to let people know when they’re doing well, or offering constructive comments to help them when they’re off track? New research suggests that this is a trick question. The answer, as one might intuitively expect, is that both are important. But the real question is — in what proportion? READ MORE
Are You a Digital Flake? 3 Etiquette Rules for Changing Times Business experts and sociologists confirm that manners in business are in decline, reflecting a general deterioration of etiquette that is a consequence of changing times, attitudes and the rise of social media. READ MORE
FASB Among 12 Participants in IASB Advisory Forum FASB is one of 12 national and regional standard setters that will participate as an inaugural member of a group that has been formed to provide technical advice to the International Accounting Standards Board (IASB). READ MORE
H&R Block Return Error Triggers Class-Action Suit A class-action suit was filed against H&R Block Inc. on Tuesday for the faulty filing of hundreds of thousands of tax returns that led to a delay of payment for as long as six weeks. The suit alleges that H&R Block advertises a 100 percent accuracy guarantee for all of its products and that the company made a mistake but hasn’t offered compensation to any of the plaintiffs or members of the class. READ MORE
Accountants Pay Rising an Average 3.3% This Year Accountants with solid credentials should have no employment worries, because demand and pay throughout the profession are showing strong gains this year, according to reports from the recruitment firm Robert Half International. READ MORE
Workers Saving Too Little to Retire Workers and employers in the U.S. are bracing for a retirement crisis, even as the stock market sits near highs and the economy shows signs of improvement. New data show that powerful financial and demographic forces are combining to squeeze individuals and companies that are trying to save for the future and make their money last. READ MORE
Remote Working: 4 Keys to Success Changes in technology and firm culture are making flexible work arrangements more mainstream. However, transitioning to a new way of working is a learning process for everyone involved. Here are a few of the lessons that Arianna Campbell learned from making the transition herself. READ MORE
...News
SEC Corner
Bishop’s View from the Catbird Seat W
. Anderson (Andy) Bishop prepared the following information and editorial comments, as of Jan. 31, 2013. Contact him at wabcpa@msn.com. SEC’s New Boss? If the U.S. Senate confirms her, Mary Jo White will be the new head of the Securities and Exchange Commission (SEC), the first time a former prosecutor will fill the position. White spent almost nine years prosecuting complex white collar and international terrorism cases during her days as U.S. Attorney for the Southern District of New York. In 2002, she rejoined Debevoise & Plimpton LLP, New York, as a partner. Her practice concentrates on internal investigations and defense of companies and individuals accused of white collar corporate crime or SEC and civil securities law violations, among others. I’m excited about her nomination. White, like me, believes prosecutors should rarely if ever indict corporations for criminal wrongdoing – instead they should focus more on the individuals who committed the crime. Although White will not possess the tools criminal prosecutors do, such as wiretaps, search warrants, and grand-jury investigations, she will have the SEC’s power to carry out an investigation and issue a tell-all story about an individual, even if no violation is found. Each time I sign Forms 10-K and Q, I am reminded
of the SEC’s power to bar individuals from serving as officers or directors of a public company – thus taking away a person’s livelihood. Remember: The burden of proof in a criminal case is “beyond a reasonable doubt” compared to a civil case which is “the preponderance of the evidence,” the former being in the 90% range and the latter being greater than 50%. Insider Trading Rules and 10b5-1 Plans: Compliance with insider trading rules should be on all boards of directors’ meeting agendas. Today, 10b5-1 plans are on the SEC’s radar, but boards may not have focused on them. Some of the practices that have evolved don’t really pass the smell test, and if they were brought to the attention of directors, they would probably say no. I, for one, think the rules for such plans should be overhauled. I expect this area to be on White’s priority list, too. XBRL: FEI (Financial Executive International) has been asking the SEC to reconsider the costs and benefits of XBRL. At least the SEC should exempt Smaller Reporting Companies – which have a public float (not market cap) of less than $75 million. Conflict Minerals: This rule is estimated to cost investors in excess of $3 billion upfront to comply. I’m sure the SEC staff wishes this one would go away – and so do I.
The JOBS Act: If you are contemplating an IPO, take advantage of the regulatory relief that this new law allows. A company is exempt from internal control audits for a few several years – but XBRL is still required. A confidential filing is a huge advantage: competitors don’t have months to pore over filings before you go public. A Missed Opportunity: In April 2012, the SEC rejected attempts by the Carlyle Group and proposals by Pfizer and Gannett stockholders to mandate arbitration rather than litigation in disputes between investors and management. The SEC gave no explanation for its actions on Carlyle (related to an IPO), and it said opaquely the Pfizer and Gannett proposals might violate the securities laws. Having personally been involved in a suit like this, the only ones who win are attorneys and insurance companies that sell the D&O policies. This matter deserves a fair hearing. Foreign Investments: Many foreign public companies are dropping their NYSE or NASDAQ listings to avoid internal control audits and XBRL reporting requirements. Wouldn’t it be grand if domestic companies had the same ability to opt out? Let the shareholders/owners decide if they want this added protection that does little to safeguard their investments. The money spent far outweighs the benefits.
must render a conclusion and certify as to the effectiveness of their disclosure controls. I consider disclosure controls to encompass proper and timely reporting of the S-K requirements (MD&A for example) and internal controls to encompass proper reporting of the S-X requirements (the financial statements). Also the Proxy Statement, the CD&A, and Form 8-K fall under the umbrella of disclosure controls. Ask yourself how you would respond to an SEC comment letter that requested evidence of the last evaluation performed to insure the effectiveness of your disclosure controls. Most companies have set up a disclosure committee to insure that the SEC reporting requirements are met. SAS 100 Quarterly Reviews: As we know, all public companies must have their 10-Qs reviewed before filing. Although the SEC does not require the report to be filed, consider obtaining from the auditors the SAS 100 review report anyway. Many audit committees are requesting the written review report for their files, and many companies are including such report in their filings. A few of the companies that include the review report in their 10-Qs: Alcoa, Pepsi, Gap, Microsoft, Boeing, Yum, Allstate, FedEx, 3M, Sprint, and Denver’s own Western Union.
Risk Modeling at the SEC: The Division of Risk, Strategy, and Financial Innovation (RiskFin) is trailblazing. It hopes to identify earnings management among other things. I hope it works.
In-house EDGAR: Doing the EDGAR filings for periodic reports is a snap now that the software has improved substantially. Thomson/Reuters pretty much has a monopoly on this in that it owns both www.edgarease.com and www.edgarfiling.com. For complex registration statements, it’s probably best to stick with the Big Two: Donnelley and Merrill.
Disclosure Controls: As all public companies have been doing for the last ten years, the CEO and CFO
Codification of Existing Standards: One way to stay current on the plethora of changes in GAAP and SEC
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rules is to subscribe to one of the services like ARM, Comperio, and Checkpoint. PCAOB: I sure hope it adopts the proposed rule requiring audit partners to personally sign their names to audit reports. As CFO of a public company who personally signs the 302 and 906 certificates, along with meeting the attendant disclosure requirements, I don’t think it’s too much to ask of audit partners. I would go as far as disclosing the age and business experience of the partner and concurring partner. Happy 40th Anniversary, FASB: Some of us remember the good ol’ days of the APB. For those who think it stands for “all points bulletin,” ask an overforty CPA…s
To stay current on SEC matters, check out... • http://www.pwc.com/us/en/cfodirect • http://www.financialexecutives.org/ KenticoCMS/home.aspx#axzz2MnqfjEAy • ifrs.com • lw.com • www.mofo.com (Yes, you read it right; it’s not a typo.) • nacd.com • niri.org • www.sec.gov • http://www.thecorporatecounsel.net/ home/ (especially Broc’s Blog)
4:30 to 6:30 p.m.
Kevin Taylor's at the Opera House 14th and Curtis St., Denver
Keynote Speaker
Dean Christine Riordan
Daniels College of Business, University of Denver
SAVE THE DATE May 23, 2013
Click here for a nomination form Nomination Deadline April 2, 2013
April CPE Line-Up NEW Excel Financial Projection Model for Business Plans, Acquisitions, Annual Budgets, and Cash Flow Forecasts • April 22 — COCPA
Gain the tools, training, and direction you need create up to five years of financial projections. Bonus: Receive Excel projection-model worksheets to take with you! $355/$507*
Business Law Essentials for Accountants • April 23 — COCPA
Avoid costly litigation for your company or clients and learn to build viable defenses when faced with legal matters in bankruptcy, employment law, intellectual property, securities regulations, and more. $345/$493*
Annual Update for Controllers: Current Issues and the Latest Trends • April 24 — COCPA and Webcast
Gain a better understanding of current economic issues and the latest trends in accounting, finance, human resources, treasury management, and business systems. $345/$493* * Member/Nonmember Fee
Controller and CFO Skills: Advanced CFO & Controller Leadership Skills • April 25 — COCPA and Webcast
Review the 10 critical skills that add value to your company and boost your career. $345/$493*
NEW 2-hour Course Healthcare Reform: Where Are We Today? Where Are We Headed Tomorrow? • April 26 — COCPA and Webcast
Get a synopsis of the Patient Protection and Affordable Care Act, and consider its impact on businesses and consumers — the good, the bad, and the ugly. $75/$107*
NEW 2-hour Ethics Course Barriers to Ethical Behavior and Leadership • April 29 — COCPA McCoy's description of the Parable of the Sadhu dilemma and Lincoln Hall's near-disaster on Mt. Everest will be contrasted using leadership attributes in this thought-provoking course. $75/$107*
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Upcoming Webinars Excel — Best Practices for Printing and Formatting March 28 Explore the ins and outs of ALL of the functionality in Excel to format and print your spreadsheets professionally and efficiently.
Preparing for a CFO Role March 29 Find out what it takes to become a CFO and to be successful once you are there.
Financial Analysis in a Metrics Driven World March 29 Learn how to take advantage of Excel Financial Functions for better analysis and, ultimately, to make effective financial decisions.
IMPORTANT REMINDER FOR COLORADO CPAS The Colorado State Board of Accountancy is changing the certificate renewal month from May to November. Plan to renew your certificate in November 2013. You will be required to sign an attestation, stating your required 80 CPE hours will be completed before Dec. 31, 2013. Again, you have until Dec. 31, 2013 to complete the required CPE for this renewal period.