New Bookmarks
Year 2002 Quarter 1:  January 1-March 31 Additions to Bob Jensen's Bookmarks
Bob Jensen at Trinity University

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Choose a Date for Additions to the Bookmarks File

March 31, 2002              March 25, 2002          March 4, 2002     

February 25, 2002         February 15, 2002      February 5, 2002   

January 16, 2002          January 8, 2002          January 1, 2002 

Scroll down this page to view this week's new bookmarks. 

For earlier editions of New Bookmarks, go to http://www.trinity.edu/rjensen/bookurl.htm 

I maintain threads on various topics at http://www.trinity.edu/rjensen/threads.htm 

San Antonio Events and Regional Links --- http://www.trinity.edu/rjensen/sanantonio.htm 

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For date and time, try the The Aggie Digital Clock --- http://yugop.com/ver3/stuff/03/fla.html

March 31, 2002

 Bob Jensen's New Bookmarks on March 31, 2002
Bob Jensen at Trinity University 

Quotes of the Week

Had the computer come first—and paper second—no one would raise an eyebrow at the flight strips cluttering our air-traffic-control centers.
by Malcolm Gladwell in the March 25, 2002 edition of The New Yorker --- http://www.newyorker.com/printable/?critics/020325crbo_books 

They put their pants on the same way we do.  They just pull them up two feet higher.
Rich Glas, North Dakota basketball coach just prior to his team's 91-61 loss to Kansas.

If our food, drinks and service aren't up to your standards, please lower your standards.
Red Dog Saloon, Juneau, Alaska
Auditing firms and their self-regulating processes seem to have adopted a similar slogan (see below)

Nobody stands taller than those willing to stand corrected.
William Safire

We know accurately only when we know little; with knowledge, doubt increases.
Johann Wolfgang von Goethe

If you hate a person, you hate something in him that is a part of yourself.
Hermann Hesse

You're not going forth.  You're going to take that damn hat off, and you're going to get a job.
Bill Cosby, in a commencement address at Southern Methodist University

Life is a game. Money is how we keep score.
Ted Turner (as quoted in a recent message from Andrew Priest)

When the Time Waner write down was reported on a local radio station, it was observed that it was bigger than our the New Zealand GDP!  Surely this should be a lesson to those who want to carry goodwill in any capacity (e.g. as brands). The numbers are without meaning.
Robert B Walker [walkerrb@ACTRIX.CO.NZ] 

But open archiving means you don't have to go to the journal and we believe it could very rapidly undermine the journals without putting anything in their place.  The problem is that things happen in the loop and somebody has to pay for them.
Sally Morris, Association of Learned and Professional Society Publishers, in a March 25 BBC News interview --- http://news.bbc.co.uk/hi/english/sci/tech/newsid_1885000/1885931.stm 

In the final analysis, there is a real learning curve involved in maximizing both the instructional and business models for this type of program. Still, it is clear that corporate education is heading in a new direction. Companies like Intel are looking to this new corporate education model to provide higher quality assurances and overall increased value. By combining a traditional graduate degree curriculum with content tailored to the needs of a company, customized degree programs offer unprecedented benefits to both the employee and employer and stand to ultimately redefine the relationship between academia and the "real world."
Tom Moore (See Babson College's experiments with "Tailor-Made Degrees" below.)

Self Regulation Really Works in New York --- It Kept a Few NY Drunks From Performing Bad Audits
Out of roughly 50,000 accountants licensed in New York, only 16 were disciplined by the state last year-most of them for drunk driving. In fact, only one was reprimanded on professional grounds.
NEW YORK, March 18, 2002 (Crain's New York Business) — http://www.smartpros.com/x33351.xml 

They were an admixture of old-fashioned and uncouth, a duo almost as unlikely as Neil Simon's odd couple.  The seventy-year-old had been married to the same woman for forty years, in the same job for more than twenty, and in the same place--Orange County, California--forever.  The fifty-four-year-old had recently divorced and remarried, switched jobs often and moved even more frequently, most recently to a million-dollar home in swanky Moraga, east of Oakland, California.  Despite their obvious differences, they spoke on the phone virtually every day for many years.  They first met in 1975 and had traded billions of dollars of securities with each other.  The elder of the pair was the Orange County treasurer, Robert Citron; the younger was a Merrill Lynch bond salesman, Mike Stamenson.  Together they created what many officials described as the biggest financial fiasco in the United States: Orange County's $1.7 billion loss on derivative
Frank Partnoy, Page 157 of Chapter 8 entitled "The Odd Couple"
F.I.A.S.C.O. : The Inside Story of a Wall Street Trader by Frank Partnoy
- 283 pages (February 1999) Penguin USA (Paper); ISBN: 0140278796 
A longer passage from Chapter 8 appears at http://www.trinity.edu/rjensen/fraud.htm#DerivativesFraud 

A second passage beginning on Page 166 reads as follows:

Also on December 5, Orange County filed the largest municipal bankruptcy petition in history.  Orange County's funds covered nearly two hundred schools, cities, and special districts.  The losses amounted to almost $1,000 for every  man, woman, and child in the county.  The county's investments, including structured notes, had dropped 27 percent in value, and the county said it no longer could meet its obligations.

The bankruptcy filing made the ratings agencies look like fools.  Just a few months before, in August 1994, Moody's Investors Service had given Orange County's debt a rating of Aa1, the highest rating of any California county.  A cover memo to the rating letter stated, "Well done, Orange County."  Now, on December 7, an embarrassed Moody's declared Orange County's bonds to be "junk"--and Moody's was regarded as the most sophisticated ratings agency.  The other major agencies, including S&P, also had failed to anticipate the bankruptcy.  Soon these agencies would face lawsuits related to their practice of rating derivatives.

On Tuesday, January 17, 1995, Robert Citron and Michael Stamenson delivered prepared statements in an all-day hearing before the California Senate Special Committee on Local Government Investments, which had subpoenaed them to testify.  It was a pitiful display.  Citron left his wild clothes at home, testifying in a dull gray suit and bifocals.  He apologized and pleaded ignorance.  He said, "In retrospect, I wish I had more education and training in complex government securities."  Stuttering and subdued, appearing to be the victim, Citron tried to excuse his whole life: He didn't serve in the military because he had asthma; he didn't graduate from USC because of financial troubles; he was an inexperienced investor who had never even owned a share of stock.  It was pathetic.

Stamenson also said he was sorry and cited the enormous personal pain the calamity had produced.  He pretended naivete.  He said Citron was a highly sophisticated investor and that he had "learned a lot" from him.  Stamenson's story was as absurd as Citron's was sad.  When Stamenson asserted that he had not acted as a financial adviser to the county, one Orange County Republican, Senator William A. Craven, couldn't take it anymore and called him a liar.  Stamenson finally admitted that he had spoken to Citron often--Citron had claimed every day--but he refused to concede that he had been an adviser.  At this point Craven exploded again, asking, "Well, what the hell were you talking about to this man every day?  The weather?"  Citron's lawyer, David W. Wiechert, was just as angry.  He said, "For Merrill Lynch to distance themselves from this crisis would be akin to Exxon distancing themselves from the Valdez."

For updates on derivative financial instruments frauds, go to http://www.trinity.edu/rjensen/fraud.htm#DerivativesFraud 

Nice going Lehman:  To Hell With the Widows and Orphans
Richard Gross, an analyst at Lehman Bros., maintains a "strong buy" rating on Enron as the stock declines from $81 to $0.75. A Lehman spokesperson helpfully explains to the New York Times that the firm was advising Dynegy on its purchase of Enron's pipeline, and it is Lehman's policy not to change the firm's rating on any company involved in a deal in which Lehman is an adviser.
Number 55 among the 101 Dumbest Moments in Business reads as follows at http://www.business2.com/dumbest/

Nice Going Paine Webber:  To Hell With the Widows and Orphans
Accounting Has Big Problems, But It is Not as Rotten to the Core as the Professions of Financial Analysis and Investment Banking --- http://www.trinity.edu/rjensen/fraud.htm#Cleland 

"The Man Who Paid the Price for Sizing Up Enron," by Richard A. Oppel, Jr., The New York Times, March 27, 2002, Page C1 ---  http://www.nytimes.com/2002/03/27/business/27ENRO.html 

Enron (news/quote) executives pressed UBS PaineWebber to take action against a broker who advised some Enron employees to sell their shares in August and was fired by the brokerage firm within hours of the complaint, according to e-mail messages released today by Congressional investigators.

The broker, Chung Wu, of PaineWebber's Houston office, sent a message to clients early on Aug. 21 warning that Enron's "financial situation is deteriorating" and that they should "take some money off the table."

. . .

The episode illustrates just how easily Enron appears to have thrown its weight around at a Wall Street firm, which may have satisfied a big corporate customer at the expense of some retail customers. PaineWebber managed Enron's stock option program for employees and handled brokerage accounts for many company executives. It also did substantial investment banking work for Enron, which generated fees for the firm. PaineWebber said that Mr. Wu was fired because he had violated policies by sending unauthorized e-mail messages to more than 10 clients and by failing to disclose that PaineWebber's research analyst had rated Enron a "strong buy."

But the day that Mr. Wu was fired was the day that Enron's chairman, Kenneth L. Lay, was both shedding some of his own shares and talking up the stock. On Aug. 21, Mr. Lay sold $4 million of stock to the company. He also sent an e-mail message to employees saying that one of his highest priorities was to restore investor confidence, adding that that "should result in a significantly higher stock price."

The message complaining to PaineWebber about Mr. Wu was sent by Aaron Brown, an Enron official who PaineWebber said helped oversee the stock option program. Mr. Brown could not be reached for comment. A switchboard operator at Enron said today that Mr. Brown no longer worked at the company, and a spokesman did not respond to questions.

Mr. Wu, who declined to comment through his lawyer today, previously asserted that Enron was behind his dismissal, but today's disclosure was the first to show pressure was applied by Enron officials. Mr. Wu now works for A. G. Edwards.

A PaineWebber spokesman declined to elaborate on the matter involving Mr. Wu but pointed to a letter sent to Congress last week.

  Continued at http://www.nytimes.com/2002/03/27/business/27ENRO.html 

Bob Jensen's threads on how the professions of investment banking and security analysis are rotten to the core can be found at  http://www.trinity.edu/rjensen/fraud.htm#Cleland 

This week's, March 31, updates on the Enron scandal and accounting fraud are in a separate document at http://www.trinity.edu/rjensen/fraud033102.htm 

Do you think that, in retrospect, the following initiative would have deterred the Lay, Skilling, Fastow executives at Enron or David Duncan at Andersen?  I contend that they will still do it because they can still get away with it, and even if they get caught stealing millions of dollars, the payoff vastly exceeds the punishment.  
Read the following March 21, 2002 Message from Phil Livingston, CEO of Financial Executives International (FEI)

Read an HTML version of this message, plus our archive of past issues, at http://www.fei.org/newsletters/feixp/ 

SEC CHAIRMAN PITT OUTLINES CURRENT SEC INITIATIVES IN SENATE TESTIMONY Chairman Pitt emphasized that the Commission and Congress must act together towards reform, with the Congress only stepping in with legislation, which "would have the benefit of extending the reach of the available SEC authority where necessary".

Chairman Pitt's recommendations focused on the following three areas for reform: · Corporate governance and disclosure, including MD&A requirements for critical accounting policies, SPEs and related party transactions and trend information, and guidelines toward more timely disclosure · Accounting reform, including the public accountability board (PAB), and auditor independence requirements · Accounting standard setting to improve the FASB process by broadening FASB funding sources, advocating principles-based standards and providing more SEC input to the FASB agenda

He stressed the need to increase the "CEO's individual accountability for his or her company's disclosure" via certification to shareholders of significant information. With regard to the PAB, he emphasized "private sector" regulation with SEC oversight, comprised "predominantly of independent public members, unaffiliated with the accounting profession". Membership in the PAB would be a "prerequisite to an auditor's ability to supply audit opinions on which a registrant may rely". The SEC does not advocate a ban on "the receipt of non-audit services from their auditors and believes the SEC framework, adopted in late 2000, will over time, serve investors better." The Commission is also against the mandatory rotation of auditors and cautions on creating a "cooling off" period for which auditors cannot go to work for their clients.

Chairman Pitt also referenced, and included as an appendix to his testimony, FEI's recently released Reform Recommendations. Here's the Chairman's complete testimony, and it includes much more detail and opinion than I could provide here: http://www.sec.gov/news/testimony/032102tshlp.htm 

Speaking as the final witness before the Senate Banking Committee, Harvey L. Pitt, chairman of the Securities and Exchange Commission, argued against proposed legislation that would introduce radical reforms for accounting firms, but supported reforms of companies, credit agencies, and accounting standard-setters. http://www.accountingweb.com/item/75865 

The Securities and Exchange Commission has filed suit against the founder and five other former top officers of Waste Management Inc. for massive fraud. The complaint charges the defendants with inflating profits to meet earnings targets. http://www.accountingweb.com/item/76329 

Note that Waste Management just announced that it was changing auditors.  The auditor up to now was (guess?) Arthur Andersen.

Bob Jensen's threads on this and other frauds can be found at http://www.trinity.edu/rjensen/fraud.htm 

Hi Patricia,

You raise deep questions, and I am afraid that today I only have time to give you off-the-wall answers that hardly do justice to your questions.

Firstly, I might point out that Trinity University accounting courses are very traditional in a five-year program leading to an MS in Accounting. Being a very small university with only five accounting faculty, we often teach course modules rather than entire courses in some specialties like not-for-profit accounting. Our strength lies in student quality due, in large measure, to the huge Trinity University endowment that provides financial aid to the best and brightest prospects and/or provides small classes and great learning opportunities outside the classroom. Virtually all incoming first-year students have never considered majoring in accounting. A few see the light along the way, and we graduate about twenty students per year in our MS in Accounting Program. Our students all intern in their senior year, and nearly all have their jobs in hand before even starting their fifth year program. The program is a success for our students, so we have not tinkered with radical innovations that might upset the success of the students and the program. I think we are probably quite like most accounting education programs in that regard.

If you want to listen to an influential professor who takes a quite opposite viewpoint, you should listen to the August 2001 remarks of Professor Joel Demski when he became this year's President of the American Accounting Association. In an August 15, 2001 controversial address to the American Accounting Association, current AAA President Joel Demski lamented the fall of accounting education (I think he meant business education in general) from scholarship, joy, and an academic curriculum. In particular, he blasted the current textbooks and publishers, public accounting firms, accounting educators, administrators, and the tendency for scholarship and curricula to become niched into specialty topics with failing cross-communications between those specialties such as tax accounting, capital markets studies, NFP accounting, managerial accounting, AIS, etc. In particular he laments the way accounting curricula have evolved to meet the career interests of public accounting firm employers and the virtual failing of the five-year, 150-credit, requirements to sit for the CPA examination. At the end of his address to the membership, Joel announced a curriculum-design competition. Winners will be announced in August 2002 at the annual meetings in San Antonio.

You can both read and listen to Joel Demski's August 15 address to the AAA membership at http://www.cs.trinity.edu/~rjensen/001aaa/atlanta01.htm 

My own feelings about accounting education cannot be divorced from my feelings about higher education. I think that the traditional undergraduate and graduate "diplomas" should be replaced by a succession of life-long "certifications" that begin with required liberal exposure to a large variety of disciplines that reduces over time to increasingly narrower focus upon disciplines and technical details. After say, ten years, the certifications should become quite narrow and quite technical. What we have now is an undergraduate diploma that pretends to "certify" such graduates as "artists," "managers," "accountants," "psychologists,"  "engineers," etc. when these graduates have only superficial backgrounds and skills in their chosen fields.  They become more specialized in graduate education programs, but then the formal education process ends.  On-the-job learning, of course, continues, but is a haphazard and serendipitous life-long progression that needs to be improved upon in virtually all academic disciplines.  In some professions there are certification examinations, but these typically do not progress down to increasingly technical successions of certification accomplishments over the life of a specialist.  The certification process is also too focused upon examinations rather than mentoring and rigorous education/training courses.  I am not just talking about professions like accounting, engineering, law, and medicine.  I am also talking about art, art history, history, literature, etc.

I have become a very vocal advocate of distance education.  My main reason is that I think that distance education using emerging technologies offers mentoring and lifelong learning opportunities that were not feasible until very recently.  And these technologies are improving at breakneck speed.  See http://www.trinity.edu/rjensen/000aaa/0000start.htm 

I am not optimistic about rapid change in this regard.  The so-called corporate universities offer more hype than hope.  Traditional universities such as the University of Wisconsin offer hundreds or thousands of online courses and are making enormous strides in educational experiments.  But these programs are trapped in our existing culture, traditional economy, and traditional employment practices.  Change must be monumental in the economy, business tradition, profession tradition, and culture.  Such change may be very disruptive and must evolve slowly rather than with a big bang.  Bit by bit the world will make progress as the world becomes more global due to modern education technologies.  

Rather than isolate the poor and ignorant people who suffer and make war, we need to use our new education technologies to offer them affordable opportunities and share our knowledge and to make creative contributions to our knowledge bases.   We then need to offer them career tracks and lifelong opportunities to better themselves and their products and services.

In terms of accounting education and professional opportunity, I am very worried about the impact of the Enron/Andersen scandal.  Some of the serious proposals such as the dropping of most consultancy services will be disastrous overreactions.  But this is leading me astray, and I am running out of time today.  So I will close here.

Best of luck in your endeavor to both same and improve accountancy and the education of its faithful servants.

Bob Jensen.

-----Original Message----- 
From: Willipat@aol.com [mailto:Willipat@aol.com]  
ent: Tuesday, March 26, 2002 1:36 PM 
To: rjensen@trinity.edu  
Subject: accounting education

Dear Professor Jensen:

It was a pleasure to meet you at the University of Denver's panel "Accounting in Turmoil: Picking Up the Pieces." As I told you, I write CPE for CPA's and am currently writing a chapter for CPE Direct (the subscription program from the AICPA in connection with the Journal of Accountancy) on the changes needed in accounting education. The article from the JofA that is part of this chapter is entitled "The Crisis in Accounting Education" and points out the decrease in the number of accounting students, their qualifications, and the need for changes in accounting education.

When I spoke to you at DU you indicated that you prefer to answer questions by email.

One of the questions that you answered at DU had to do with how you would change accounting education. Would you be willing to elaborate on what you think needs to be done in order to improve accounting education overall? How would you go about recruiting the most qualified students to the accounting profession? What has Trinity University done in this area? I will, of course, quote you, and include any information about you, Trinity's accounting program, and the university as a whole, that you would like included. I would like permission to include your web site in the chapter. You have such a wealth of information on your site. I wish I had known about it much sooner!

Thank you so much for taking time to consider answering these questions. If you would prefer, I would be happy to call you for an interview by phone. However, I know that with your schedule, email is probably more convenient for you.

Patricia Lane Williams 
303-367-4496 Willipat@aol.com 

Two Letters to Senator Schumer

On March 25, 2002, Walter P. Schuetze, former Chief Accountant of the Securities and Exchange Commission, wrote Senator Schumer a letter that leaves no doubt that he opposes booking of employee stock options when they vest. That letter is now on the Web at http://www.trinity.edu/rjensen/theory/sfas123/schuetze01.htm 

I wrote a draft reply in order to point out some opposing arguments. My reply is on the Web at http://www.trinity.edu/rjensen/theory/sfas123/jensen01.htm 

Mr. Schuetze is a friend, and my arguments in the above letter are academic. Nothing personal in any way is intended.

Educators and students may also be interested in the short case that I wrote in the Appendix to my letter.

Actually, I have not yet mailed my letter to Senator Schumer and would appreciate replies with helpful suggestions and corrections.

For added background reading, I have added some other papers/lectures by Walter Schuetze as follows:

• Letter to Senator Charles E. Schumer
  http://www.trinity.edu/rjensen/theory/sfas123/schuetze01.htm
  
  
• (Wanted: Accounting that Investors, Members of Congress, and My Sister Can Understand)
  http://www.trinity.edu/rjensen/theory/sfas123/schuetze02.htm 
  
  
• 2001 RJ Chambers Research Lecture
  http://www.trinity.edu/rjensen/theory/sfas123/schuetze03.htm 
  
  

Once again, my reply reply is on the Web at http://www.trinity.edu/rjensen/theory/sfas123/jensen01.htm 

Thanks,

Bob (Robert E.) Jensen
Jesse H. Jones Distinguished Professor of Business
Trinity University, San Antonio, TX 78212
Voice: (210) 999-7347 Fax: (210) 999-8134
Email: rjensen@trinity.edu 
http://www.trinity.edu/rjensen 

March 31, 2002 reply from Robert B Walker [walkerrb@ACTRIX.CO.NZ] 

I have briefly scanned the two letters. I would say at the outset that I, too, have a strong instinct for realisable value as the benchmark for assessing financial position - at least I do until I deal with the public sector where the notion breaks down.

My first thought is that Mr Schuetze asks himself the wrong question. He asks is there an asset which is depleted? He should ask: is there an obligation with a financial value? If the answer is yes, then he has a credit and a resultant debit to deal with. Then he can consider whether the debit has any value or not. If no then it is a debit to equity (net assets) in some way.

In his first scenario, where the senators manage their Club, there is no obligation. No further issues arise.

In his second scenario, there is an obligation. It has a financial value. In the event of booking the credit, does the debit have any 'future economic' (cash?) benefit. The answer is no because it has had value in the past not the future. Then:

Dr Expense Cr Liability.

The liability will be discharged by a transfer of shares to the owner of the right. This is the same as giving the person some money and having them buy shares (doctine of substance over form or representational faithfulness applies). The problem is this. There is no outflow of economic benefits (money), except in substance (the problem with that doctrine is anything can mean everything), because:

Dr Liability Cr Equity (paid up capital)

We are left then with doing one of two things:

First, redefine Liability to be Equity - Type 2 compared to Equity - Type 1, being that held by the original shareholders. You then have, essentially, a shuffle around inside equity. You do, however, achieve the main objective. You inform the original shareholders that they have had value transferred from themselves to another, for which they received a service. This is necessary because otherwise how will they know?

Another way to see the problem is to conceive of it as having two separate reporting entities. RE1 is the merged interest of the original stockholders. RE2 is the interest of the newcomer. The first accounting then makes a sort of sense. The two reporting entities are then combined without carrying out eliminations.

Remember I can only argue the second of these because of our (NZ) definition of the reporting entity which states:

'A reporting entity exists where it is reasonable to expect users dependent on general purpose financial reports for information which will be useful to them in terms of the objectives [of general purpose financial reporting.' (para 2.1 Statement of Concepts for General Purpose Financial Reporting)

March 31, 2002 reply from nodoushan@mail.hartford.edu 

Dear Robert: 

The other issue that I believe is behind the effort not to book or value stock options is the tax treatment. I'm a tax accountant so this is my take.

Currently, there is no taxable income upon the receipt of a nonstatutory option that does not have a readily ascertainable fair market value, even if the FMV of the option is ascertainable before it is exercised or disposed of. The rules are under Internal Revenue Code §83 which does define "readily ascertainable" but the definition requires that four conditions exist: 1) option is freely transferable by the recipient; 2) option is immediately exercisable in full by the recipient; 3)option is not subject to any condition or resitrction that has a significant effect upon its FMV; and 4)FMV of option is readily ascertainable.

Obviously, companies write the options so that these conditions are not met because there is a time restriction and the options usually are not transferable. However, if FASB/SEC/Congress changes financial accounting rules and requires stock options to be valued and booked when issued, you will probably see the Treasury/IRS/Congress move to have the income taxed immediately. There would be a major commotion against this as it violates the "wherewithal to pay" concept, but this concept is violated frequently in the IRC. Then, you have the problem of what happens if the value later declines? Do you allow the employee a loss deduction equal to previously taxed income, and what if the tax rates have changed? Congress can deal with this but it adds complications.

I believe that changes to financial accounting for stock options will change the tax treatment. If the company reports the options as compensation expense does it go in the employees W-2? There is too much potential income out there to ignore if these options will have a "readily ascertainable value." We all know that they do have a value to both the company and the employee; the tax question has always been what's the value prior to exercise and when should the value be taxed?

More issues to consider and to complicate things. Just thought I'd add my two cents. If you're writing to Congressmen about something that could increase taxes they don't always act in the best interest of accounting theory. 

Patricia Nodoushani, Ph.D., CPA 
Dept. of Accounting & Taxation 
University of Hartford

WHITE-COLLAR CRIMINALS Enough Is Enough They lie they cheat they steal and they've been getting away with it for too long. 
by Clifton Leaf, Fortune magazine, March 18, 2002, pp. 60-78 --- http://www.fortune.com/indexw.jhtml?channel=artcol.jhtml&doc_id=206659&_DARGS=%2Fhtml%2Fmag_archive%2Fmag_archive_index.html.6_A&_DAV=Home 

And how many attorneys are in this office to fight the nation's book cookers, insider traders, and other Wall Street thieves? Twenty-five--including three on loan from the SEC. The unit has a fraction of the paralegal and administrative help of even a small private law firm. Assistant U.S. Attorneys do their own copying, and in one recent sting it was Sandy--one of the unit's two secretaries--who did the records analysis that broke the case wide open. (Page 72)

----------------------------

Nevertheless, the last commission chairman, Arthur Levitt, did manage to shake the ground with the power he had. For the 1997-2000 period, for instance, attorneys at the agency's enforcement division brought civil actions against 2,989 respondents. That figure includes 487 individual cases of alleged insider trading, 365 for stock manipulation, 343 for violations of laws and rules related to financial disclosure, 196 for contempt of the regulatory agency, and another 94 for fraud against customers. In other words, enough bad stuff to go around. What would make them civil crimes, vs. actual handcuff-and-fingerprint ones? Evidence, says one SEC regional director. "In a civil case you need only a preponderance of evidence that there was an intent to defraud," she says. "In a criminal case you have to prove that intent beyond a reasonable doubt." (pp. 70-71)

----------------------------

The auditor in that case, you'll recall, was Arthur Andersen, which paid $110 million to settle a civil action. According to an SEC release in May, an Andersen partner authorized unqualified audit opinions even though "he was aware of many of the company's accounting improprieties and disclosure failures." The opinions were false and misleading. But nobody is going to jail.

At Waste Management, yet another Andersen client, income reported over six years was overstated by $1.4 billion. Andersen coughed up $220 million to shareholders to wipe its hands clean. The auditor, agreeing to the SEC's first antifraud injunction against a major firm in more than 20 years, also paid a $7 million fine to close the complaint. Three partners were assessed fines, ranging from $30,000 to $50,000, as well. (You guessed it. Not even home detention.) Concedes one former regulator familiar with the case: "Senior people at Andersen got off when we felt we had the goods." Andersen did not respond to a request for comment. (Page 63)

Waste Management Defects: There Appears to Be No Honor Among Thieves 
Big Five firm Andersen is facing almost daily defections of major clients as publicly held companies jump ship in search of another auditor. Waste Management, Occidental Petroleum and Dynegy have announced they have switched to other Big 5 firms. http://www.accountingweb.com/item/74745 

"WHITE-COLLAR CRIMINALS Schemers and Scams: A Brief History of Bad Business It takes some pretty spectacular behavior to get busted in this country for a white-collar crime. But the business world has had a lot of overachievers willing to give it a shot."
by Ellen Florian, Fortune magazine, March 18, 2002, pp. 62-68 --- http://www.fortune.com/indexw.jhtml?channel=artcol.jhtml&doc_id=206661 

1920: The Ponzi Scheme 
Charles Ponzi planned to arbitrage postal coupons--buying them from Spain and selling them to the U.S. Postal Service at a profit. To raise capital, he outlandishly promised investors a 50% return in 90 days. They naturally swarmed in, and he paid the first with cash collected from those coming later. He was imprisoned for defrauding 40,000 people of $15 million.

1929: Albert Wiggin 
In the summer of 1929, Wiggin, head of Chase National Bank, cashed in by shorting 42,000 shares of his company's stock. His trades, though legal, were counter to the interests of his shareholders and led to passage of a law prohibiting executives from shorting their own stock.

1930: Ivar Krueger, the Match King 
Heading companies that made two-thirds of the world's matches, Krueger ruled--until the Depression. To keep going, he employed 400 off-the-books vehicles that only he understood, scammed his bankers, and forged signatures. His empire collapsed when he had a stroke.

1938: Richard Whitney 
Ex-NYSE president Whitney propped up his liquor business by tapping a fund for widows and orphans of which he was trustee and stealing from the New York Yacht Club and a relative's estate. He did three years' time.

1961: The Electrical Cartel 
Executives of GE, Westinghouse, and other big-name companies conspired to serially win bids on federal projects. Seven served time--among the first imprisonments in the 70-year history of the Sherman Antitrust Act.

1962: Billie Sol Estes 
A wheeler-dealer out to corner the West Texas fertilizer market, Estes built up capital by mortgaging nonexistent farm gear. Jailed in 1965 and paroled in 1971, he did the mortgage bit again, this time with nonexistent oil equipment. He was re-jailed in 1979 for tax evasion and did five years.

1970: Cornfeld and Vesco Bernie 
Cornfeld's Investors Overseas Service, a fund-of-funds outfit, tanked in 1970, and Cornfeld was jailed in Switzerland. Robert Vesco "rescued" IOS with $5 million and then absconded with an estimated $250 million, fleeing the U.S. He's said to be in Cuba serving time for unrelated crimes.

1983: Marc Rich 
Fraudulent oil trades in 1980-81 netted Rich and his partner, Pincus Green, $105 million, which they moved to offshore subsidiaries. Expecting to be indicted by U.S. Attorney Rudy Giuliani for evading taxes, they fled to Switzerland, where tax evasion is not an extraditable crime. Clinton pardoned Rich in 2001 (and he and Hillary received over $7,000 in furniture from the wife of Marc Rich to furnish the Clinton's new home in New York.)

1986: Boesky and Milken and Drexel Burnham Lambert 
The Feds got Wall Streeter Ivan Boesky for insider trading, and then Boesky's testimony helped them convict Drexel's Michael Milken for market manipulation. Milken did two years in prison, Boesky 22 months. Drexel died.

1989: Charles Keating and the collapse of Lincoln S&L 
Keating was convicted of fraudulently marketing junk bonds and making sham deals to manufacture profits. Sentenced to 12 1/2 years, he served less than five. Cost to taxpayers: $3.4 billion, a sum making this the most expensive S&L failure.

1991: BCCI 
The Bank of Credit & Commerce International got tagged the "Bank for Crooks & Criminals International" after it came crashing down in a money-laundering scandal that disgraced, among others, Clark Clifford, advisor to four Presidents.

1991: Salomon Brothers 
Trader Paul Mozer violated rules barring one firm from bidding for more than 35% of the securities offered at a Treasury auction. He did four months' time. Salomon came close to bankruptcy. Chairman John Gutfreund resigned.

1995: Nick Leeson and Barings Bank 
A 28-year-old derivatives trader based in Singapore, Leeson brought down 233-year-old Barings by betting Japanese stocks would rise. He hid his losses--$1.4 billion--for a while but eventually served more than three years in jail.

1995: Bankers Trust 
Derivatives traders misled clients Gibson Greetings and Procter & Gamble about the risks of exotic contracts they entered into. P&G sustained about $200 million in losses but got most of it back from BT. The Federal Reserve sanctioned the bank.

1997: Walter Forbes 
Only months after Cendant was formed by the merger of CUC and HFS, cooked books that created more than $500 million in phony profits showed up at CUC. Walter Forbes, head of CUC, has been indicted on fraud charges and faces trial this year.

1997: Columbia/HCA 
This Nashville company became the target of the largest-ever federal investigation into health-care scams and agreed in 2000 to an $840 million Medicare-fraud settlement. Included was a criminal fine--rare in corporate America--of $95 million.

1998: Waste Management 
Fighting to keep its reputation as a fast grower, the company engaged in aggressive accounting for years and then tried straight-out books cooking. In 1998 it took a massive charge, restating years of earnings.

1998: Al Dunlap 
He became famous as "Chainsaw Al" by firing people. But he was then axed at Sunbeam for illicitly manufacturing earnings. He loved overstating revenues--booking sales, for example, on grills neither paid for nor shipped.

1999: Martin Frankel 
A financier who siphoned off at least $200 million from a series of insurance companies he controlled, Frankel was arrested in Germany four months after going on the lam. Now jailed in Rhode Island--no bail for this guy--he awaits trial on charges of fraud and conspiracy.

2000: Sotheby's and Al Taubman 
The world's elite were ripped off by years of price-fixing on the part of those supposed bitter competitors, auction houses Sotheby's and Christie's. Sotheby's chairman, Taubman, was found guilty of conspiracy last year. He is yet to be sentenced.

Bob Jensen's threads on fraud, including derivative financial instruments fraud, are at http://www.trinity.edu/rjensen/fraud.htm 

"Hard Time? Hardly In 1999 we wrote about some accounting bad guys who seemed to have airtight cases against them. Guess how many went to jail?"
by Carol J. Loomis, Fortune magazine, March 18, 2002, Page 78 --- http://www.fortune.com/indexw.jhtml?channel=artcol.jhtml&doc_id=206662 

Raise your hand if you think one or more Enron executives should go to jail. The yes votes on that one would surely put President Bush's approval rating to shame. We might even get past 99.99% affirmative, with only the Lay, Skilling, and Fastow families voting no.

But the fact is that putting bigtime executives in jail for perpetrating accounting frauds has proved very hard to do. Some 2 1/2 years ago (Aug. 2, 1999) FORTUNE ran an article, Lies, Damned Lies, and Managed Earnings, that spotlighted the accounting scandals of the time. Of the big ones then generating tales of absolutely egregious behavior, none has produced jail sentences.

Indeed, only one produced a sentence of any kind: Bruce J. Kingdon, who had run a division of Bankers Trust that did securities processing, pleaded guilty in September 2000 to conspiracy and falsifying bank records, and was ordered to perform 450 hours of community service, see a therapist once a week for three years, and pay fines of $180,500. (Bankers Trust itself had earlier paid a $63 million fine.) Kingdon's lawyer says his client's community service consisted of work for a medical cause--"cerebral palsy or muscular dystrophy or something like that."

Jail sentences could yet come out of several other cases, including two that have actually produced indictments. The zinger is likely to be the case against two prominent CUC International executives, CEO Walter Forbes and President Kirk Shelton, who in 1997 merged their company with HFS Inc. to form Cendant. A scant four months later CUC's accounting was exposed as rotten, and Cendant's market value dropped $14 billion in one day.

In time the U.S. Attorney for New Jersey, working with the SEC, wrung cooperating plea agreements from three former CUC financial executives, who are expected to testify against Forbes and Shelton. The two men are charged with three types of fraud--securities, mail, and wire--and with conspiracy to lie to the SEC. In their trial, scheduled to start in Newark in September, they will face a morally outraged team of prosecutors, one of whom says, "This is war." Forbes and Shelton cannot have been helped by the furor over Enron.

The second batch of indictments emerged from another merger-related mess, arising from McKesson's acquisition of software supplier HBO & Co. in January 1999. Again, within months rot was exposed, this time in HBO's accounting. (Say, whatever happened to the due diligence that supposedly precedes mergers?) After a criminal investigation headed by San Francisco Assistant U.S. Attorney Leslie Caldwell, the two co-presidents of HBO, Albert Bergonzi and Jay Gilbertson, were charged with the fraud battery--securities, mail, and wire--and with conspiracy. No date has been set for their trial, and Caldwell won't, in any case, be apt to take part in it. She's now heading the Department of Justice task force that's investigating Enron.

"Massive financial fraud" is what the SEC says occurred at both McKesson and Cendant. But that is also how it described the goings-on a few years ago at Sunbeam and Waste Management, and those cases have brought no criminal indictments. That means the executive everyone loves to hate, deposed Sunbeam CEO Al Dunlap, has escaped charges, and so has Waste Management's former CEO, Dean Buntrock. Other escapees: partners of Arthur Andersen & Co., which was the outside auditor at both Sunbeam and Waste Management (and, as all the world knows, at Enron).

The weirdest accounting case around is one in which indictments have existed for years, but nothing has made it to court. Here, in early 1999, the U.S. Attorney for the Southern District of New York, Mary Jo White, charged Garth Drabinsky and Myron Gottlieb of theatrical producer Livent with 15 counts of fraud and one of conspiracy. But Drabinsky and Gottlieb had already fled to Canada, Drabinsky's homeland--and there they remain today. No wonder, since the U.S. Attorney's office has never moved to extradite them, even though it vowed from the start to do so.

Continued at  http://www.fortune.com/indexw.jhtml?channel=artcol.jhtml&doc_id=206662  

Nice Going Paine Webber:  Screw the Widows and Orphans

Accounting Has Big Problems, But It is Not as Rotten to the Core as the Professions of Financial Analysis and Investment Banking --- http://www.trinity.edu/rjensen/fraud.htm#Cleland 

"The Man Who Paid the Price for Sizing Up Enron," by Richard A. Oppel, Jr., The New York Times, March 27, 2002, Page C1 ---  http://www.nytimes.com/2002/03/27/business/27ENRO.html 

Enron (news/quote) executives pressed UBS PaineWebber to take action against a broker who advised some Enron employees to sell their shares in August and was fired by the brokerage firm within hours of the complaint, according to e-mail messages released today by Congressional investigators.

The broker, Chung Wu, of PaineWebber's Houston office, sent a message to clients early on Aug. 21 warning that Enron's "financial situation is deteriorating" and that they should "take some money off the table."

. . .

The episode illustrates just how easily Enron appears to have thrown its weight around at a Wall Street firm, which may have satisfied a big corporate customer at the expense of some retail customers. PaineWebber managed Enron's stock option program for employees and handled brokerage accounts for many company executives. It also did substantial investment banking work for Enron, which generated fees for the firm. PaineWebber said that Mr. Wu was fired because he had violated policies by sending unauthorized e-mail messages to more than 10 clients and by failing to disclose that PaineWebber's research analyst had rated Enron a "strong buy."

But the day that Mr. Wu was fired was the day that Enron's chairman, Kenneth L. Lay, was both shedding some of his own shares and talking up the stock. On Aug. 21, Mr. Lay sold $4 million of stock to the company. He also sent an e-mail message to employees saying that one of his highest priorities was to restore investor confidence, adding that that "should result in a significantly higher stock price."

The message complaining to PaineWebber about Mr. Wu was sent by Aaron Brown, an Enron official who PaineWebber said helped oversee the stock option program. Mr. Brown could not be reached for comment. A switchboard operator at Enron said today that Mr. Brown no longer worked at the company, and a spokesman did not respond to questions.

Mr. Wu, who declined to comment through his lawyer today, previously asserted that Enron was behind his dismissal, but today's disclosure was the first to show pressure was applied by Enron officials. Mr. Wu now works for A. G. Edwards.

A PaineWebber spokesman declined to elaborate on the matter involving Mr. Wu but pointed to a letter sent to Congress last week.

  Continued at http://www.nytimes.com/2002/03/27/business/27ENRO.html 

Bob Jensen's threads on frauds have been updated at http://www.trinity.edu/rjensen/fraud.htm 

Oxford University Press has launched what may be the world's largest reference collection on the Internet -- with a hefty fee to view it.

"Oxford Online: Will People Pay?" by Kendra Mayfield, Wired News, March 28, 2002 --- http://www.wired.com/news/business/0,1367,51300,00.html 

Now, this centuries-old collection of illustrious reference works will be available to anyone with an Internet connection -- if they can afford the annual subscription fees.

"It will offer a new global standard for reference across the Internet, and in the process make accessible Oxford's massive reference assets," said Rob Scriven, managing editor of Oxford Dictionaries.

The Core Collection, the first database to be available as part of Oxford Reference Online, integrates over 100 dictionaries and reference titles across an array of subjects -- from astronomy to zoology -- into a single cross-searchable resource.

OUP decided to take its extensive collection online because "the technology is there to put books online, the content is there and the interest is large," said Rebecca Seger, sales and marketing director for OUP USA scholarly and professional reference group.

All that information comes at a price, however. Annual subscription fees will cost approximately $250 a year for schools and anywhere from $395 to just under $3,000 for multiple-user accounts such as libraries.

Institutions and organizations can also sign up for a free 30-day trial. More than 3,000 institutions around the world have signed up so far.

But will users pay for content when many general reference materials on the Web remain free?

Oxford University Press publishers think so.

Continued at  http://www.wired.com/news/business/0,1367,51300,00.html 

Babson College's experiments with "Tailor-Made Degrees"

"Tailor-Made Degrees: Customized Corporate Education," by Tom Moore, Syllabus, March 2002, pp. 30-33 --- http://www.syllabus.com/syllabusmagazine/article.asp?id=6135 

The popular notion of a new graduate entering "the real world" points to the fact that we commonly view academia and the corporate environment as two disparate, almost polarized communities. The perception may be that universities focus on theory while businesses concentrate on practice. And to combine the two—to influence academic curriculum on behalf of corporate needs—has traditionally been frowned upon as a corruption of pure academic purpose.

This is not to say that higher education has ignored the corporate community. Colleges and universities have long offered corporate training programs and customized courses. However, corporate offerings and traditional degree programs have fallen into two distinct categories, usually considered to be very separate: the graduate degree program, typically thought of as the more rigorous education experience designed exclusively by academics, and the executive education program, a shorter-term, not-for-credit alternative intended to serve the corporation’s needs.

Now, due in large part to the maturing nature and growing acceptance of distance learning, the wall that once stood between business and academia is beginning to crumble. Over the past few years, we’ve begun to see a blending of executive education and graduate degree programs. The result is a new model for professional education: the corporate-customized graduate degree program.

The Babson College Experience

In 2000, Babson College opened the doors of Babson Interactive, a school dedicated to applying e-learning to innovative management education programs. The goal was to create an e-learning/faceto- face hybrid that is both responsive to the needs of businesses and culminates in a degree from an established brick-andmortar university.

When I was first hired by Babson College, I held the titles of dean of the Babson School of Executive Education and dean of its Graduate School of Business. My responsibilities included overseeing Babson’s MBA programs and executive education courses at the same time. As I stepped into the position of CEO of Babson Interactive, I relinquished my role as dean of the Graduate School but retained my title and responsibilities as dean of Executive Education. It was clear from the start that e-learning offered high potential for an entirely new type of executive education, and that Babson Interactive was the place where we would explore the possibilities.

Babson had been watching the development of e-learning from the sidelines for quite some time before opening Babson Interactive. At first we were, frankly, not very interested. For the most part, the technologies appeared underdeveloped and unproven. We had great concern that the initial technology was not robust enough to provide the kind of insight and judgment building that we felt a good graduate program should offer.

In the past few years, however, we’ve seen the technology improve and have observed other institutions implement very successful e-learning programs. I now believe that a blended degree program—one that incorporates both elearning and face-to-face instruction— offers an education experience that can, in fact, be superior to the traditional classroom experience. The key is in the proper balancing of these two learning modes.

A number of corporations have come to Babson Interactive. In one example, Babson, along with Cenquest, an e-learning company with expertise in creating online courses, developed a oneof- a-kind company-customized MBA degree program for Intel Corp. By combining the foundational and theoretical knowledge included in a Babson graduate degree with the strategic intent of the company, the program provided Intel with a completely new employee education option.

The customization of the curriculum took several forms. The Intel team offered input into the class electives. They also provided real work projects to be used as examples and incorporated into the coursework. Through e-learning technology, Intel executives, partners, and even customers could be included as guest lecturers.

ROI and Student Benefits

Corporations have long viewed companyreimbursed education as a standard employee benefit alongside health care and bonus programs. U.S. businesses spend $58 billion annually on employee education. And in a market where there is always fierce competition for top employees, offering quality education programs is seen as essential to hiring and retaining the best and brightest.

Unfortunately, the return-on-investment for company-reimbursed degree programs has been less than easy to quantify. Corporations have had little influence over the schools being attended, much less the programs being offered and the curriculum being taught. Aside from reimbursement contingencies based on keeping a certain grade point average, businesses have had limited input into the nature of their employee’s for-credit education experience. The programs are typically funded more upon faith and hope then on real data showing that employees will learn skills that will increase their overall value to the company.

Perhaps a larger irony to these programs is that while they are seen as a necessary tool for hiring and retaining employees, they often have an opposite effect. It is not unusual for a company to pay for an employee’s graduate education only to have that employee leave once the degree is obtained. In such cases, the reimbursement program often becomes a company-sponsored training ground for its competition.

Since the programs at Babson Interactive are designed to increase an employee’s value to the company, chances are far better that graduates will continue their careers at the company once their degree is completed. And since employees work and study with other employees from various corporate locations, managers see the learning experience as providing a rare opportunity to build valuable employee relationships across company campuses.

Lessons Learned

In the final analysis, there is a real learning curve involved in maximizing both the instructional and business models for this type of program. Still, it is clear that corporate education is heading in a new direction. Companies like Intel are looking to this new corporate education model to provide higher quality assurances and overall increased value. By combining a traditional graduate degree curriculum with content tailored to the needs of a company, customized degree programs offer unprecedented benefits to both the employee and employer and stand to ultimately redefine the relationship between academia and the "real world."

March 26 Internet 2 Update from Kevin Kobelsky, Kevin [kobelsky@MARSHALL.USC.EDU] 

Janet Fulk of our Annenburg School for Communication has been happy using the Internet 2 infrastructure for high quality video conferencing. It has enabled her to conduct a joint doctoral seminar with two other distant US-based schools. With Internet 2, there are no charges for the bandwidth connecting the schools. Market prices for such bandwidth would be in the tens of thousands of dollars, effectively precluding the seminar.

Kevin Kobelsky PhD CA·CISA 
Assistant Professor Leventhal School of Accounting, 
Marshall School of Business 
University of Southern California Accounting Building 125 
Los Angeles, CA 90089-0441 
Voice: (213) 740-0657 Fax: (213) 747-2815

March 29 message from Glen L. Gray [vcact00f@CSUN.EDU] 

Information Week had an interesting article that says that teens are developing bad "work" habits that may cause them problems at work--e.g., plagiarism.

http://www.informationweek.com/story/IWK20020307S0005 

Glen L. Gray, PhD, CPA 
Department of Accounting and Information Systems 
California State University, Northridge 18111 Nordhoff Street 
Northridge, CA 91330-8372 818.677.3948 
glen.gray@csun.edu  
http://www.csun.edu/~vcact00f 

Bob Jensen's threads on cheating and plagiarism are at http://www.trinity.edu/rjensen/plagiarism.htm 

From Infobits on March 28, 2002

"Online Education Must Capitalize on Students' Unique Approaches to Learning, Scholar Says" by Michael Arnone THE CHRONICLE OF HIGHER EDUCATION, March 4, 2002 http://chronicle.com/free/2002/03/2002030401u.htm 

In a recent interview, Nishikant Sonwalkar, principal educational architect at the Education Media Creation Center at the Massachusetts Institute of Technology, says "online learning provides tremendous opportunity for providing pedagogical choices to learners that cannot be provided by a single professor or teacher in a classroom situation. Online education provides a unique opportunity to use multiple representations of knowledge in terms of media. At the same time, it also provides opportunity to sequence this knowledge in a way so that it makes more pedagogical sense, by providing different learning strategies."

---

"High-tech teaching could be 'suicidal,' scholar says" by John Sanford STANFORD REPORT, February 11, 2002 http://www.stanford.edu/dept/news/report/news/february13/gumbrecht-213.html 

Speaking at the Stanford University Center for Teaching and Learning's "Award-Winning Teachers on Teaching" series, Hans Ulrich Gumbrecht, Albert Guerard Professor of Literature, said, "I think this enthusiastic and sometimes naive and sometimes blind pushing toward the more technology the better, the more websites the better teacher and so forth, is very dangerous -- [that it] is, indeed, suicidal."

Stanford Report is published daily by the Stanford University News Service, 425 Santa Teresa Street, Stanford, CA 94305-2245 USA; tel: 650-723-2558; email: stanford.report@forsythe.stanford.edu ; Web: http://www.stanford.edu/dept/news/report/ 

---

"Philosopher's Critique of Online Learning Cites Existentialists (Mostly Dead)" by Michael Arnone THE CHRONICLE OF HIGHER EDUCATION, March 15, 2002 http://chronicle.com/free/2002/03/2002031501u.htm 

Hubert L. Dreyfus, a professor of philosophy at the University of California at Berkeley, "argues that the Internet's promise of extending and improving human interaction through the digital medium isn't everything it's cracked up to be. . . . To prove his point, Mr. Dreyfus calls on existentialist philosophers from the 19th and 20th centuries, most of whom never saw a computer or heard of the Internet."

---

"Oversold and Underused: Why Faculty Don't Use Computers in the Classroom" by Larry Cuban AFT ON CAMPUS, March 2002 http://www.aft.org/publications/on_campus/march02/technology.html 

While affirming that most academics make great use of computer technology in their writing, research, and communication, Cuban argues that "University promoters of computers for instruction need to downsize their expectations for deep changes in pedagogy or seriously examine other factors that influence how professors teach." He believes that "[t]raditional forms of teaching seem to have been relatively untouched by the enormous investment in technologies that universities have made in recent decades."

AFT On Campus is published eight times a year by the American Federation of Teachers, 555 New Jersey Avenue NW, Washington, DC 20001 USA; tel: 202-879-4400; email: online@aft.org; Web: http://www.aft.org/ Current and back issues are available at no cost at http://www.aft.org/publications/on_campus/index.html 

---

Tom Moore, dean of Babson College's School of Executive Education, writes: "The popular notion of a new graduate entering 'the real world' points to the fact that we commonly view academia and the corporate environment as two disparate, almost polarized communities. The perception may be that universities focus on theory while businesses concentrate on practice. And to combine the two--to influence academic curriculum on behalf of corporate needs--has traditionally been frowned upon as a corruption of pure academic purpose." In "Tailor-Made Degrees: Customized Corporate Education" (SYLLABUS, vol. 15, no. 8, March 2002, pp. 30-1, 33), Moore describes how Babson created a school that can be customized to meet individual corporation's needs while students benefit from both e-learning and face-to-face instruction experiences. The article is available online at http://www.syllabus.com/syllabusmagazine/article.asp?id=6135 

---

In his book, HIGHER ED, INC: THE RISE OF THE FOR-PROFIT UNIVERSITY (Baltimore: Johns Hopkins University Press, 2001), Richard S. Ruch writes, "I must confess that until a few years ago I thought that all proprietary institutions were the scum of the academic earth. I could not see how the profit motive could properly coexist with an educational mission. While I did not know exactly why I believed this, I was certain in my conviction that non-profit status was noble, just as the profession of education is noble, and that to be for-profit meant to be in it for the money, which was corrupting and ignoble." Based on his subsequent experiences with for-profit colleges and universities, Ruch re-examines these assumptions.

The first chapter of the book is available online at http://www.press.jhu.edu/press/books/titles/s01/s01ruhi.htm 

 

Online Learning: From Philosophy to Application - Why We Should to How We Can
By Mary Delgado, Technology and Learning, March 2002, Page 52 --- http://www.techlearning.com/db_area/archives/WCE/archives/mdelgado.htm 

Philosophy - Why We Should

Explore Web sites that will help you develop a strategy for online learning from developing a philosophy to determining scenarios for application. In other words, find out why we should to how we can.

Distance Learning...What is it?
This site presents an interesting critique of the nature of e-learning and how it can or cannot fit into existing philosophies of education. Differentiates the different kinds of courses using online structure.

Learning To Learn: Using research to define effective distance education.
The author presents a paper of the ideas of notable writers on the subject of the philosophy of distance education.

alt.education.distance FAQ [part 1 of 4]
This four-part website answers frequently asked questions about distance and online learning.

Philosophy and Purposes of Distance Education
This lengthy paper describes the philosophy and purposes of distance education including credit and non-credit courses, relationship of on-campus and off campus learning, and different models of distance learning.

Constructivist Theory Unites Distance Learning and Teacher Education
They said it couldn't be done, but here is an article that combines constructivist theory with both distance learning and teacher education. The authors use interviews with teachers whose teaching methods have changed after combining constructivist theory in building online courses.

Application -- How We Can

GOALS: Global Online Adventure Learning Site
This is a terrific site for teachers interested in taking their students on virtual journeys. Each location allows students to view graphics and read about the area. They can then email the explorers with comments and questions. The Classroom Expedition page provides lesson plans and activities.

EdWeb: Exploring Technology and School Reform
"An intelligent, detailed, informed and practical guide, both to education related issues concerning the Internet, and to educational resources on the World Wide Web." (quoted from the Harvard Educational Review)

Online Learning - an Overview
Excellent site on the pitfalls and successes of online learning for university students. Interactive pages provide wealth of information for prospective students of e-learning.

Planning and Designing Educational Facilities Online
This is an online course from the University of California Riverside for all school board members, administrators, district planners, etc., who are involved in the planning, designing, and executing the advancement of e-learning.

The Web of Asynchronous Learning Networks
Visit this resource website, which is for anyone interested in asynchronous online delivery systems.

Bob Jensen's threads are at http://www.trinity.edu/rjensen/000aaa/0000start.htm 

What's New, By T&L Editors, Technology and Learning, March 2002, Page 58 --- http://www.techlearning.com/db_area/archives/TL/2002/03/whatsnew.html 

Hardware

Printers

Kyocera Mita America has introduced the FS-1010 black-and-white laser printer, designed for individual users and small workgroups and featuring 600 x 600 dpi resolution, 15-page-per-minute printing speed, and support for parallel, USB, and Card Flash interfaces. The FS-1010 comes with a one-year parts and labor warranty. $429.

Kyocera Mita America, 225 Sand Rd., P.O. Box 40008, Fairfield, NJ 07004; (800) 222-6482

Oki Data's OKI C7000 Series printers can print at 12 pages per minute in full color and 20 pages per minute in black and white. Additional features include 600 x 1200 dpi resolution, the ability to print on various types of card stock, and an output of 10,000 pages before the toner needs to be changed. Rebates are available for schools that trade in old ink-jet or laser printers. $3,499.

Oki Data, 2000 Bishops Gate Blvd., Mount Laurel, NJ 08054; (856) 235-2600

Projection Devices

BOXLIGHT has unveiled the SP-9t LCD projector that comes with 1000 ANSI lumens, 800 x 600 SVGA resolution (compressed 1280 x 1024 SXGA), built-in component video input, digital keystone adjustment, and manual zoom and focus. The unit is backed by a two-year parts and labor warranty and a 120-day lamp guarantee. $1,999.

BOXLIGHT, 19332 Powder Hill Pl., Poulsbo, WA 98370; (800) 844-6464

Software

4MATION LiveText is a Web-based professional development system. Using their own lesson models or one of five built-in templates, teachers can create and update lessons from any Internet-enabled computer. Tutorials are designed to provide strategies for sparking student motivation, mastery of facts, and other instructional techniques. Lessons are then stored on LiveText's server, where teachers can search for additional lessons from other participating teachers. State standards are available for quick reference, as are collaboration tools such as forums, chat groups, and lesson reviews provided by other teachers.

About Learning, Inc., 1251 N. Old Rand Rd., Wauconda, IL 60084; (800) 822-4628

Gemteq Software, Inc., just released Version 2.0 of its eGems Collector Pro software. New features of this research tool are designed to improve speed by capturing Web pages, pictures, and hyperlinks simultaneously. New editing capabilities offer options to update collected gems or create and format original content with text, images, and links. Bibliography formats now include APA, MLA, and Chicago style. Workgroups are also available for users on shared networks. Upgrade for $29.95 at the site or purchase a CD for $79.95.

Gemteq Software, Inc., 936 7th St., Ste. R, Novato, CA 94945; (415) 899-8100

Newton's Quest for grades 4, 5, and 6, from Knowledge Adventure, focus on cross-curricular skill-building exercises. Designed to reinforce problem-solving strategies and test performance, these programs cover a full year of the math and language arts curriculum, and each title includes over 4,000 questions. Content is also correlated to state standards, as well as to the Stanford Achievement Test and the Iowa Test of Basic Skills. Teacher editions start at $59.95.

Knowledge Adventure, 101 Castleton St., P.O. Box 100, Pleasantville, NY 10570; (800) 321-7511

Macromedia's new Accessibility and E-Learning Solutions Kit provides tools and resources for Web developers who want to make content on their site accessible to people with disabilities and who are interested in building online courses. Media templates, tutorials, and accessibility resources help develop and retrofit Web sites, making them available to all users. New e-learning features include product extensions and tutorials on moving content to the Web. Both are free with purchase or upgrade to Flash 5, Dreamweaver 4, or eLearning Studio.

Macromedia, 600 Townsend St., San Francisco, CA 94103; (415) 252-2000

TB Labs has released RoadLingua, a dictionary database that fits in a handheld computer's optional memory card (MMC/SD/CF or MemoryStick). The database allows users to choose from several multilingual and specialty dictionaries for devices running Palm OS 2.0 and above or Windows CE 3.0 and above. $14.95. A free trial version can be downloaded at the Web site.

TB Labs, 30-1-66, Anokhina ul., Moscow, Russia 117602; (661) 760-8820

Books

Geared toward administrators and instructors, The Design and Management of Effective Distance Learning Programs examines challenges and solutions related to distance education. Examined issues include costs incurred for remote equipment, loss of traditional evaluation methods, potential losses of academic integrity, and more. $74.95.

Idea Group, Inc., 1331 E. Chocolate Ave., Hershey, PA 17033-1117; (800) 345-4332

The Web Design CD Bookshelf offers unabridged versions of the six most popular O'Reilly Web-building titles. Topics include HTML, ActionScript, information architecture, and more. The collection can be viewed through any Web browser; references and tutorials are fully searchable, cross-referenced, and indexed. $79.95. Also from O'Reilly, Building Wireless Community Networks provides a blueprint for a wireless LAN based on 802.11b standards. Also included are sample configuration files, network layout diagrams, and topographical maps. $24.95.

O'Reilly, 1005 Gravenstein Hwy. N, Sebastopol, CA 95472; (800) 998-9938

Zuleyma Tang-Martinez apparently sides with David Noble

"Higher Education and the Corporate Paradigm: the Students are the Losers," by Zuleyma Tang-Martinez --- http://www.louisville.edu/journal/workplace/tang-martinez.html 

0.1. As institutions of higher education throughout the US and abroad have adopted the corporate model, "efficiency" and profit have been emphasized, while students have been redefined as "customers", "consumers," and "clients." In reality, what we are currently witnessing, as the result of this corporate paradigm, is the destruction of American higher education. University presidents and administrators take on the roles of Chief Executive Officers, and business managers have not supported greater diversity or inclusiveness in academia, whether in terms of faculty or students. The bottom line has become making money rather than educating students or fostering an environment conducive to free intellectual inquiry and development. 

0.2. Although faculty often object to the corporate paradigm, because of what it does to our profession and to us as individuals, it is important to keep in mind that ultimately it is the students and their education who suffer the most and have the most to lose. There are three trends, dictated by the corporate approach, that profoundly affect the quality of the education our students receive.

For more on the negative side, go to http://www.trinity.edu/rjensen/000aaa/theworry.htm 

For the positive side, go to http://www.trinity.edu/rjensen/000aaa/updateee.htm 

For a summary of assessment issues, go to http://www.trinity.edu/rjensen/assess.htm 

Cross Archive Search Engines discussed by Peter Cuber, "Noesis:  Is it a library with built-in searching or a search engine with a built-in library?" Syllabus, March 2002, pp. 18-22 --- http://www.syllabus.com/syllabusmagazine/article.asp?id=6133 

Every discipline has a rapidly growing body of literature on the Web. Many hard-working volunteers in every field have built Web directories of this literature. Some have even built discipline-specific search engines. As the scholarly content on the Web grows, life gets more and more difficult for these directory and search engine editors. Think about the problems they face. They must try to cover the field, or their own topic within the field, comprehensively. They must distinguish worthy literature from unworthy. They must discover new sites within a reasonable time and add them if they are worthy. They must fix or delete dead links. The directory editors must organize their contents to help users navigate. If they can, they should offer searching, not only of the links and their annotations, but of the full-text files to which they point. Finally, they must use methods that scale up as the relevant body of literature continues to grow. Methods that worked five years ago when the Web was small no longer work today.

Noesis (noesis.evansville.edu) is an online library and search engine for the field of philosophy that solves these problems. Moreover, the software enabling it to solve them is transferable to any other discipline.

I’m one of the two co-editors of Noesis. My partner, Tony Beavers, deserves the credit for envisioning and implementing the features of this powerful software. In what follows, I can make immodest claims for Noesis because I’m praising Tony.

Noesis Today

Noesis has a board of topic editors, each with a different specialization within the field. The topic editors are responsible for monitoring their corners of the field for old, new, and worthy content. The Noesis software gives them a Web form for adding sites, which is much easier than writing HTML code or sending e-mail to another human editor who then writes HTML code. (Noesis also gathers new content by inviting user submissions, which are evaluated by the editors.) Topic editors may organize their topic area according to the sub-topics of their choice. Users can browse or search the entire Noesis collection or any sub-collection produced by an individual editor. By dividing the labor among the editors, an entire discipline can be covered comprehensively and kept up-to-date. If one editor has too large a topic to cover adequately, then we only have to divide the topic and add another editor.

Gateway Selection Filters

Noesis uses several kinds of peer review to identify and recommend worthy sites. The first is at the gateway, when editors use their professional judgment to decide what deserves to be included. In addition to the criteria invoked in the gateway decisions, Noesis currently requires (with a few exceptions) that the texts be written by Ph.D.s. As we’ll soon see, Noesis supports other, higher kinds of quality control that sort out the better from the worse among the texts that make it into the collection.

Adjustable-Scope Searching

Searching is the glory of Noesis. Because Noesis stores all its texts in a database, it can index them for searching much more quickly than a traditional search engine can crawl a series of Web sites. For the same reason, it can fine-tune the construction of the index. Traditional searchable collections only support all-or-nothing searching: if a file contains the search string, then a link to the file appears on the hit list, and otherwise not.

But Noesis is an adjustable-scope search engine. Users can search the whole collection, any sub-collection created by a topic editor, the collection of works by a given author, the collection of works from a given journal or set of journals, or the custom collection created by the user. Noesis also classifies its texts by genre (essays, reviews, course syllabi, and so on) and lets users filter any search by genre. Finally, editors only need to collect links to desirable texts; Noesis will automatically provide fulltext searching of those texts.

Adjustable-scope searching allows users to add another layer of peer review to their research. If you trust the peer review judgments made by the editors of journals A, B, and C, then you can set the scope of Noesis to search just those journals.

When updating its search index,Noesis automatically purges dead links. The next version of the software will put dead links in a special offline graveyard for post-mortem analysis. Most of the time, dead links mean that content has been moved, not deleted. With a little effort, the new location can be found and the link revived.

Noesis Tomorrow

The version of Noesis now online is 2.0. Noesis 3.0 will have two key features that we’ve already proved to work, so it’s not premature to sketch here how they could enhance research.

I said that in 2.0, users could create a custom collection to help organize and search a subset of the master collection. A custom collection could contain texts relevant to a course, a dissertation, or an essay.

In Noesis 3.0, user control over custom collections is set free to flourish. The first key feature in 3.0 is that users can create as many custom collections as they want. That might mean one for each course, each essay, each research interest. By default, all Noesis collections are public, so the collections you make for your courses can be used by your students. Each collection has a unique URL, making it easy to tell your students where to look.

At first only Noesis-approved editors will have the authority to add new items to the master collection—i.e., to make the gateway decisions about relevance and worth. Other Noesis users will only be able to make custom collections from the items in the master collection.

But eventually all users will be able to make Noesis collections from any content anywhere on the Web.We can give up the gateway control because Noesis will contain other, more effective forms of peer review and quality control.

Continued at http://www.syllabus.com/syllabusmagazine/article.asp?id=6133 

Cross-Archive Search Engines

ARC --- http://citeseer.nj.nec.com/liu01arc.html 

CiteBase --- http://www.eprints.org/ 

Torii --- http://torii.sissa.it/html/torii_service_provider.html 

Free Online Scholarship 

A guide to the terminology, acronyms, initiatives, standards, technologies, and players in the free online scholarship (FOS) movement —the movement to publish scholarly literature on the internet and make it available to readers free of charge --- http://www.earlham.edu/~peters/fos/guide.htm 

As I mentioned in the March 25 edition of New Bookmarks, my wife and I really enjoyed the day we spent in  Denver's Tattered Cover Bookstore.

"To Bookseller, Officers' Try at a Search Warrants a Fight A Denver drug probe clashes with aims to keep the public's reading choices private." by Joyce Meskis, Los Angeles Times, March 27, 2002 --- http://www.latimes.com/features/lifestyle/la-000021929mar27.story 
I quote the concluding paragraphs below:

Bevis, meanwhile, wondered how many other bookstores had been approached whose owners didn't have the will or the money to fight the government. "God only knows how often it's happened," he said. "And the stores that roll over, you'll never know about."

In Denver, the criminal investigation that started the Tattered Cover's ordeal has taken a back seat to the 1st Amendment case. Only one charge was ever filed in the meth lab bust, and that was later dropped. Authorities don't know where the four people who were under investigation now are.

March 28 message from Dawn Davidson

Hello Bob 

This article was in yesterday's LA Times. Isn't this your favorite bookstore in Denver?

http://www.latimes.com/features/lifestyle/la-000021929mar27.story 

dee davidson 
Accounting Systems Specialist 
Marshall School of Business Leventhal School of Accounting 
University of Southern California 213.740.5018 
dgd@marshall.usc.edu 

I attended a workshop called "Information Fluency:  Beyond the Basics" conducted by Michael Kaminski from the Trinity University Library.  Based upon his informative presentation plus some of my own searches, I added the following to my Search Helpers at http://www.trinity.edu/rjensen/searchh.htm 

Search for Library and Reference Databases 

Evaluation of Information Sources --- http://www.vuw.ac.nz/~agsmith/evaln/evaln.htm 

American Library Association (ALA) --- http://www.ala.org/ 

Information Literacy Competency Standards for Higher Education --- http://www.ala.org/acrl/ilcomstan.html 

Introduction Information Literacy Defined Information Literacy and Information Technology Information Literacy and Higher Education Information Literacy and Pedagogy Use of the Standards Information Literacy and Assessment Standards, Performance Indicators, and Outcomes Appendix I: Selected Information Literacy Initiatives  Task Force Members: Developing the Information Literacy Competency Standards

Association of College and Research Libraries --- http://www.ala.org/acrl/ 

Government

Library of Congress Online Catalog --- http://catalog.loc.gov 
FedWorld --- http://www.fedworld.gov/ 
FirstGov (over 30 million government Web pages) --- http://www.fedworld.gov/firstgov.html 
U.S. Government Information --- http://www2.lib.udel.edu/subj/godc/database/govdb.htm 
Government Documents --- http://lib.trinity.edu/servcols/govdocs/ 
Government Information and Maps --- http://www.lib.ucdavis.edu/govdoc/  
U.S. Federal Government Gray Literature --- http://www.osti.gov/graylit/ 
Public Records and by State --- http://www.pac-info.com/ 
Politics and Government --- http://www.access.gpo.gov/su_docs/multidb.html  
Also see Yahoo at http://dir.yahoo.com/Government/ 

Census Information --- http://www.peoplefind.com/frames/freeresources/govdataindex.htm 
Also see http://www.trinity.edu/mkearl/ 

Trinity University Library --- http://lib.trinity.edu/ 

Quest --- New Databases --- http://www.trinity.edu/mkaminsk/new_databases.htm  

Databases for Trinity Students, Faculty, and Staff --- http://lib.trinity.edu/dbs/dbs.asp 

eJournals, Electronic Journals --- http://www3.tdnet.com/trinity/ 
Also see http://sharewareconnection.com/play/402000index.html 

Ulrich's Periodicals Directory --- http://lib.trinity.edu/dbs//dbs.asp#U 

Michael Kaminski --- http://www.trinity.edu/mkaminsk/ 

Research Tips --- http://www.trinity.edu/mkaminsk/research_tips.htm 

New Databases --- http://www.trinity.edu/mkaminsk/new_databases.htm 

Information Databases

Free Database Links --- http://www.docx.com/freedb.htm 

Multiple International and Historical Databases (including Encyclopedias and Photographs) --- http://www.slco.lib.ut.us/databases.htm 

Global (Music, Literature, etc.)--- http://www.isop.ucla.edu/lac/bibliography-databases.htm 

Academic Gateway --- http://datalib.ed.ac.uk/sources.html 

University of Wisconsin Core Databases and Journals --- http://www.library.wisc.edu/guides/coreguide/corelist.htm 
Also see http://www.library.wisc.edu/libraries/Instruction/jaid.htm 

Baker Library (Harvard Business School) Electronic Resources --- http://www.library.hbs.edu/abouta.htm 

Business Information Databases --- http://www.ficci.com/ficci/Databases/databases.html 

Biographical Databases --- http://www2.lib.udel.edu/subj/biography/ 

Biomedical --- http://www.nlm.nih.gov/databases/databases.html 
Drug Information --- http://matweb.hcuge.ch/Medical_search/Drugs_pharmacology_pharmacy.html 
Drug Information --- http://www.coreynahman.com/medicalinfodatabases.html 
Drug Information --- http://library.pbac.edu/drug_information_databases.htm 
UNC Health Sciences --- http://www.hsl.unc.edu/lm/degrant/introduction.htm 
Health --- http://chid.nih.gov/ 
Dorland Healthcare Information --- http://www.healthcare-info.com/database.htm 
Pesticides --- http://ace.orst.edu/info/npic/tech.htm 

Business Databases --- http://dir.yahoo.com/Business_and_Economy/Business_to_Business/Information/Databases/ 

Internet and Information Systems --- http://idrinfo.idrc.ca/ 

Public Records and by State --- http://www.pac-info.com/ 

Government Information and Maps --- http://www.lib.ucdavis.edu/govdoc/ 

Legal Information Databases --- http://www.wlu.ca/~wwwlib/subject/legal/databases.html 

Politics and Government --- http://www.access.gpo.gov/su_docs/multidb.html 

Restaurants and Diets --- http://businesstravel.about.com/cs/restaurants/ 

Country of Origin and Legal Information --- http://www.unhcr.ch/research/rsd.htm 

Internet Public Library (from the University of Michigan) --- http://www.ipl.org/ 
20,000 electronic texts, and an annotated guide to web sites

Bob Jensen's Guide to Economic Statistics --- http://www.trinity.edu/rjensen/bookbob1.htm#EconStatistics 
Economic and Demographic Statistics --- http://www.pac-info.com/ 
From New Zealand (Statistical Information Databases) --- http://www2.auckland.ac.nz/lbr/stats/webpages/statsdb.htm 
Baker Library (Harvard Business School) Electronic Resources --- http://www.library.hbs.edu/abouta.htm  

Sociology Databases and Other Great Links --- http://www.trinity.edu/mkearl/ 

Bob Jensen's Bookmarks --- http://www.trinity.edu/rjensen/bookbob.htm 

Primary Sources 

Enter "Primary Sources" into Exact Phrase at http://www.google.com/advanced_search 

ORB --- http://orb.rhodes.edu/library.html 

Gray Literature (hard to find documents)

Enter "Gray Literature" into Exact Phrase at http://www.google.com/advanced_search 

U.S. Federal Government Gray Literature --- http://www.osti.gov/graylit/ 

Shareware and eBooks ---  http://sharewareconnection.com/play/402000index.html 

Some Other Free Sites Noted at http://www.techlearning.com/db_area/archives/TL/2002/03/inservice.html 

Encyclopedia.com --- http://www.encyclopedia.com 
contains more than 50,000 articles. In addition, it links to Electric Library, mentioned above.

Internet Public Library --- http://www.ipl.org 
or IPL, was one of the first public libraries "of and for the Internet community." Some available collections are general reference, associations, literary criticism, newspapers, youth, and teens.

Library of Congress Online Catalog --- http://catalog.loc.gov 
records represent the holdings of the library, including books, computer files, manuscripts, cartographic materials, music, sound recordings, and visual materials; it also includes searching aids for users.

Yahoo --- http://www.yahoo.com/

Arts & Humanities Literature, Photography... Business & Economy B2B, Finance, Shopping, Jobs... Computers & Internet Internet, WWW, Software, Games... Education College and University, K-12... Entertainment Picks, Movies, Humor, Music... Government Elections, Military, Law, Taxes... Health Medicine, Diseases, Drugs, Fitness... News & Media Full Coverage, Newspapers, TV... Recreation & Sports Sports, Travel, Autos, Outdoors... Reference Libraries, Dictionaries, Quotations... Regional Countries, Regions, US States... Science Animals, Astronomy, Engineering... Social Science Archaeology, Economics, Languages... Society & Culture People, Environment, Religion...

Bob Jensen's search helpers are at at http://www.trinity.edu/rjensen/searchh.htm  

Bob Jensen's bookmarks are at http://www.trinity.edu/rjensen/bookbob.htm 

Electronic Database and Information System Glossary --- http://databases.about.com/library/glossary/bldef-information.htm 

Bob Jensen's Technology Glossary and Links --- http://www.trinity.edu/rjensen/245gloss.htm 

Bob Jensen's Other Glossary Links (including accounting, business, and finance) --- http://www.trinity.edu/rjensen/bookbus.htm 

Individuals and nonprofits can no longer purchase personal computers in Cuba, according to a government decree. Dissidents claim it's another example of the restriction of information flow --- http://www.wired.com/news/politics/0,1283,51270,00.html 

Disaster of the Week:  Hollings' Hell

The proposed copy-protection bill from Senator Fritz Hollings would demand restrictive technology on practically all new devices. Here's a rundown on what the law would do if passed --- http://www.wired.com/news/politics/0,1283,51275,00.html 

A bill introduced by Senate Commerce Chairman Fritz Hollings would prohibit the sale or distribution of nearly any technology -- unless it features copy-protection standards to be set by the federal government.

Creating: 
Anyone selling -- or creating and distributing -- "digital media devices" may not do so unless they include government-approved security standards. Digital media devices are defined as any hardware or software that can reproduce or display copyrighted works. [Section 5(a)(1)]

Importing: 
It would be unlawful to import software or hardware without government-approved security standards. It's not clear whether this section bans an individual downloading a copy of a program from a non-U.S. website. [Section 5(a)(1)]

Protecting: 
Network-connected computer systems may not delete markers indicating a file is copy-protected. Such systems must preserve the markers intact. This section applies to peer-to-peer networks, FTP sites, websites, routers, Internet providers, library terminals and more. [Section 4]

Removing: 
Knowingly removing copy-protection markers from digital content is prohibited. [Section 6(a)(1)]

Sending: I
t would be unlawful to knowingly distribute or send someone any digital content that has been purged of its this-is-copy-protected marker. [Section 6(a)(2)]

Violations of any of those four sections will be punished by civil penalties ranging from $200 to $25,000 per violation, and, in some cases, federal felony charges.

Fair use: 
Another section says that if anyone wants to use the copy-protection standard, to be drafted by the Federal Communications Commission, they have to use the whole thing. That's designed to preserve at least minimal "fair use" rights. [Section 6(b)]

But it's a section with blunt teeth. Nearly all the other parts of the bill promise criminal penalties: This merely promises civil damages of between $200 and $2,500.

MP3 players: 
One part of the bill overrides a landmark lawsuit that said the Rio MP3 player did not violate copyright law.

In 1999, a federal appeals court ruled that Diamond Multimedia Systems could sell the Rio -- a decision that ushered in the MP3 craze. This bill rewrites current copyright law to require copy-protection in any device that "retrieves or accesses copyrighted works in digital form."

"By including that, they want to get around the Rio court case," says Ethan Ackerman, a senior research fellow at the University of Washington School of Law. "This is statutorily overruling that court case. This way they can sue the player manufacturers."

Also see "Howling Mad Over Hollings' Bill," by Brad King --- http://www.wired.com/news/mp3/0,1285,51337,00.html 
The two concluding paragraphs read as follows:

Along with upsetting the 2 million people who have already purchased digital television sets, the bill also wipes away many of the legal uses people have become accustomed to, Petricone said. The CEA is also averse to adding taxes onto the cost of new devices that could be used to pay entertainment companies, something the Audio Home Recording Act forced on portable MP3 makers.

"Consumers have the right to do things to make recordings of broadcast shows," said Petricone. "If you charge them extra, then it's not a right. If we're put in a position that we have to sell devices that don't allow people to do what they've always done, then nobody is going to buy any new devices."

"The Oscars get Napsterised," The Economist, May 22, 2002 --- http://www.economist.com/agenda/displayStory.cfm?Story_ID=1049624 

Hollywood feels threatened as more people use Internet file-sharing services to obtain free copies of movies. But just as the music business has found in its efforts to fight the mass copying of songs through services such as Napster, the film studios will not be able to rely on technology alone to protect their copyrights

Helpers for Choosing a Financial Advisor & Personal Finance Helpers --- http://www.trinity.edu/rjensen/fees.htm 

Oh Oh!

The IRS has compiled statistics indicating that Federal employees owe more than $2.5 billion in back taxes. Of the 8.7 million federal workers and retirees, 381,500 were behind on their taxes, or 2.8% of the total. Find out how this compares with a national average of the American workforce and which branches of the government are the worst offenders. http://www.accountingweb.com/item/76127 

One of the wonderful adventures of my life was a sabbatical in New Zealand.

Many locals may not have known the Dictionary of New Zealand Biography ever existed, but now that it's online, librarians hope Kiwis will get to know more about their homeland. Kim Griggs reports from Wellington, New Zealand --- http://www.wired.com/news/culture/0,1284,51132,00.html 

March 27 message from Fathom

Fathom's spring break offer is ending this week, but you still have time to take advantage of your special 25% discount. Just enter the coupon code SPRNG at checkout for any Fathom enrollment through March 31. Hundreds of new courses are open for enrollment, including:

ARTS & HUMANITIES

Tiananmen June 1989: The Roots of Crisis http://www.fathom.com/course/51704700/esp1 

Digital Video: An Introduction with Michael Rubin http://www.fathom.com/course/4701042/esp1 

HISTORY & GLOBAL AFFAIRS

Covering Terrorism: The Media and 9/11 http://www.fathom.com/course/71705500/esp1 

Israeli and Palestinian Nationalism: Debates over Partition http://www.fathom.com/course/68705501/esp1 

PROFESSIONAL DEVELOPMENT

Organizational Behavior: Communication and Conflict Resolution http://www.fathom.com/course/42704460/esp1

Disaster-Proof Your Finances http://www.fathom.com/course/40704013/esp1 

Search for more courses: http://www.fathom.com/link.jhtml?cid=esp1&page=home 

Partly driven by marketing, partly by genuine customer needs, integrated analytics will soon be the yardstick by which enterprise app business value is measured. By Sharon Ward http://www.dsi-enews.net/e-bin/enews.asp?id=8949006 

Big Blue Bully? 
A recent lawsuit filed by Compuware against IBM certifies that intellectual property protection needs to be a part of business strategy. http://www.dsi-enews.net/e-bin/enews.asp?id=8949010 

How to Value Interest Rate Swaps

Hi John,

Basics are explained in the early part of "Summary of Derivative Types." It can be downloaded free from at http://www.rutgers.edu/Accounting/raw/fasb/derivsum.exe 

I would download http://www.trinity.edu/rjensen/acct5341/speakers/133swapvalue.htm 

Then I would examine the attached solutions file for Example 5 in Appendix B, particularly Columns N-W in the "Effective" spreadsheet of that Excel workbook. The 133ex05a.xls file is also available online at http://www.cs.trinity.edu/~rjensen/ 

In practice, firms then to use the Bloomberg terminal to derive swap (yield) curves from forward rates.

Hope this helps.

Bob Jensen

-----Original Message----- 
From: Walters, John [mailto:John.Walters@bdk.com]  
Sent: Wednesday, March 27, 2002 7:55 AM 
To: 'rjensen@trinity.edu' Subject: Yield Curve Derivations

Mr. Jensen, I am trying to model a zero coupon yield curve in excel for the purpose of valuing our swap portfolio. As I'm fairly new to the Treasury area I am interested in the tutorials mentioned on your web site. Are these still available? Thanks for your assistance.

Regards, John Walters 
Treasury Manager 
Black & Decker Corporation

Messages from Business Week magazine on March 26, 2002

So you've decided to get a Master's of Business Administration--the coveted degree that often serves as an entr?e into the upper echelons of management. You've figured it's worth the $150,000 or more investment--in tuition, expenses, and two years of lost pay. And you've spent late nights boning up for the Graduate Management Admission Test, earning a score that should put you in the running for a spot on the "admitted" list at a highly rated school.

Now what? Before you slog through those lengthy applications, take a step back. You need to consider more than just a brand name when it comes to choosing the right program. Every applicant has different needs and goals, and not every school will meet them.

FOR THE FULL VERSION, VISIT: http://www.businessweek.com/magazine/content/02_12/b3775113.htm?c=bwmbamar27&n=link1&t=email 

---

 Saul Keeton -- Jones School, Rice University | Class of 2002 -- There was time during my last full-time job when it was fashionable to be "comfortable with ambiguity." I was working for Andersen Consulting, and the Internet was sizzling. High-flying, cash-burning startups were spending wildly on consulting services to rush their products to market in hopes of gobbling up chunks of market share ahead of their competitors. This new operating environment required a paradigm shift for us, the consultants. We were accustomed to working to the n-th degree of detail and to perfecting our work products prior to going live. But e-commerce changed everything.

FOR THE FULL VERSION, VISIT: http://www.businessweek.com/bschools/mbajournal/index.htm?c=bwmbamar27&n=link3&t=email 

 

Cell-phone manufacturers are cranking out new products at an astonishing rate, even though the market is flat. They sound confident, but the analysts are worried --- http://www.wired.com/news/wireless/0,1382,51152,00.html 

Where technology really helps

"Of Diesel and Dial-Up:  The IT Traveler," by Paul Heltzel, Technology Review, March 22, 2002 --- http://www.techreview.com/articles/wo_heltzel032202.asp 

It makes sense that truckers are the most well-connected travelers on the road. They need to stay in touch with the trucking company and with family. Also, they increasingly use Web-based services that help them find loads to drive home and avoid deadheading, or driving an empty trailer—every trucker's worst nightmare since those miles produce no revenue. In an attempt to remedy this situation, companies such as The Internet Truckstop, Insight Technology and On Time Media have set up Web-based load matching services. A trucker can log on to these sites, enter the city where he will be dropping off a load and the city to which he needs to return. The system will then tell him of any loads that need to be hauled between those cities. It gets sophisticated. For example, if a load is being dropped in Orlando and the trucker needs to go to New York, the system may find an Orlando-Memphis load, followed by a Memphis-Cleveland load and then a Cleveland-New York load.

Some IT investors follow the online movements of truckers closely because they are not traditionally thought of as early adopters of technology. Like travelers who pull over to eat where the truckers do, investors feel a sense of comfort once a technology becomes viable at truck stops. According to Jack Vonder Heide, president of Oakbrook Terrace, IL-based Technology Briefing Centers, 18-wheeler operators have led the way in road testing technologies that have filtered down to consumers. He notes a laundry list of technologies used today, including cell phones, ruggedized notebooks, touch screens, discount long-distance services, self-serve gas pumps, "and, lest we forget the past, CB radios."

"We find truckers to be very reliable predictors of an emerging technology's likelihood of success," says Vonder Heide. "Truckers don't have large amounts of expendable income. They're not conspicuous consumers. So when we see truckers adopt a technology, that gives us a higher level of comfort that we can recommend that technology to our clients as an investment."

So what's down the road, so to speak, after dial-up access in roadside restaurants? In the next 12 to 18 months, expect to see wireless public Internet access points begin to pop up at truck stops around the country. Using the same technology found in wireless home and office networks, 802.11b LANs provide Internet access within 200 to 300 feet of the truck stop. Providers are test marketing wireless access plans priced around 15 cents a minute (or $7 a day), as well as nationwide service plans for frequent travelers willing to subscribe for a monthly fee.

"I think wireless service will be widespread in our industry," says Bill Bartkus, vice president of IT at TravelCenters of America. "Wireless networks put Internet access at every seat, not just the ones with a phone jack. We'll add wireless access points to the exterior of the buildings, so drivers won't have to go inside. People who want to sit in the lot in their car or RV won't have to lug a laptop into the building."

FREE eBook Samplers from Barnes & Noble ---
http://ebooks.barnesandnoble.com/bn_digital/free_samplers.asp?sourceid=00394094055875196094&bfdate=03-22-2002+13:04:58 

Bob Jensen's threads on electronic books are at http://www.trinity.edu/rjensen/ebooks.htm 

National Academy Press: Scientific Inquiry in Education http://www.nap.edu/books/0309082919/html/ 

i-xiii
Executive Summary	1-6
1 Introduction	7-18
2 Accumulation of Scientific Knowledge	19-34
3 Guiding Principles for Scientific Inquiry	35-56
4 Features of Education and Education Research	57-68
5 Designs for the Conduct of Scientific Research in Education	69-90
6 Design Principles for Fostering Science in a Federal Education Research Agency	91-112
References	113-138
Appendix: Biographical Sketches, Committee Members and Staff

Bob Jensen's bookmarks on education are at http://www.trinity.edu/rjensen/bookbob2.htm 

Learning Differences and Disabilities

From PBS:  Misunderstood Minds http://www.pbs.org/wgbh/misunderstoodminds/ 

The Misunderstood Minds project consists of three elements: The PBS documentary, first airing March 27, 2002; the companion Web site on PBS Online, www.pbs.org/misunderstoodminds ; and the Developing Minds Multimedia Library.

Misunderstood Minds: the documentary

For one in five students, learning is an exhausting and frustrating struggle. Often mistakenly called "lazy" or "stupid" by their teachers, classmates, and even their families, these children may be suffering from debilitating learning problems. If not addressed, the problems can have a devastating impact on the students' self-esteem and future academic and social success.

The PBS documentary, Misunderstood Minds shines a spotlight on this painful subject, following the stories of five families as, together with experts, they try to solve the mysteries of their children's learning difficulties. Produced and directed by renowned Frontline filmmaker Michael Kirk, this 90-minute special shows the children's problems in a new light, and serves as a platform to open a nationwide dialogue on how best to manage young, vulnerable, and misunderstood minds.

Misunderstood Minds is a co-production of the Kirk Documentary Group, Ltd. and WGBH Boston. Executive producers are Michele Korf and Brigid Sullivan. The producer and director is Michael Kirk. Misunderstood Minds is closed captioned for deaf and hard-of-hearing viewers by The Caption Center at WGBH Boston. Narrated descriptions are provided by Descriptive Video Service® (DVS®), a national service of WGBH Boston that makes television, cable, and home video programming accessible to people who are blind or visually impaired.

Information on ordering a copy of Misunderstood Minds is available on the order videos section of this site, or by calling 1-800-949-8670.

Misunderstood Minds: the Web site

www.pbs.org/misunderstoodminds 

Parents, teachers, and students looking for explanations of the science behind learning difference and strategies to aid success in school, can find both on the companion Web site for Misunderstood Minds. The site includes profiles of the students in the documentary, as well as sections on Attention, Reading, Writing, and Mathematics. Interactive activities, called Firsthands, are designed to give site visitors a sense of what it may be like for a student struggling with a basic skill.

The Web site is a production of WGBH Interactive and Educational Programming and Outreach. Executive producers are Ted Sicker, Michele Korf, and Brigid Sullivan. The producer is Arthur R. Smith.

The Web site is accessible, designed for use with screen reader devices that render text into speech for blind and low-vision Web users. To learn more about providing access to Web content for users with disabilities, please visit the CPB/WGBH National Center for Accessible Media on the Web at www.ncam.wgbh.org  .

Funding for the Misunderstood Minds PBS documentary and Web site is provided by Schwab Learning, a service of the Charles and Helen Schwab Foundation; Exxon Mobil Foundation; Spencer T. and Ann W. Olin Foundation; Emily Hall Tremaine Foundation; The Roberts Foundation; Geraldine R. Dodge Foundation, and public television viewers. Thank you.

Developing Minds Multimedia Library

This multimedia library of videos and print guides is designed to help parents and teachers of elementary and middle-school children explore differences in learning through the approach and conceptual framework of developmental-behavioral pediatrician, author, and professor Dr. Mel Levine.

The 22-video library explores the relationship between learning and key brain functions, and features practical, easy-to-use strategies to help students become more successful learners. The 18 accompanying print guides reinforce the concepts and strategies presented in the videos.

The Developing Minds Multimedia Library can be ordered in its entirety. As well, multi-video sets have been arranged around particular learning difficulties and problem clusters, with many combinations to choose from. Individual videos and accompanying guides are also available.

Detailed item descriptions and full ordering information (phone, fax, or mail orders) may be obtained by downloading the brochures on the order videos page of this site. You may also call 1-800-949-8670 to request more information or to order.

About WGBH

WGBH Boston is America's preeminent public broadcasting producer. More than one-third of PBS's prime-time lineup and companion Web content is produced by WGBH, and the Boston station is the source of many public radio favorites. WGBH also is a pioneer in educational multimedia and in access technologies for people with disabilities. For more information visit www.wgbh.org.

About All Kinds of Minds

All Kinds of Minds helps families and teachers understand why a student is struggling in school and provides an action plan to help each child become a more successful learner.

Founded in 1995, All Kinds of Minds is a private, non-profit Institute, affiliated with the University of North Carolina at Chapel Hill that offers a powerful system of programs for helping kids succeed. The Institute's primary goal is to educate teachers, parents, educational specialists, psychologists, doctors, and children about differences in learning, so that students who are struggling in school because of the way their brains are "wired" are no longer misunderstood. Its programs have been developed by Dr. Mel Levine and colleagues based on scientific research and over twenty-five years of clinical experience. The programs provide a comprehensive framework for understanding how all kids learn.

All Kinds of Minds enables a student (K-12), his parents, and his teachers to understand why he is having difficulty in school and provides the language and tools for parents, educators, and clinicians to develop a concrete, practical action plan to help him succeed. For more information about All Kinds of Minds, visit www.allkindsofminds.org.

March 28 message from Vasant Raval [vraval@bluejay.creighton.edu] 

Fourth Annual Meeting of AIS Educator Association is scheduled for June 28 through July 2 in the beautiful Copper Mountain Resort in Colorado, about 80 miles West of Denver. Details are posted on the Association's website, www.ais-educ.com .

You are welcome to participate in training, or conference, or both. A total of 19 training sessions, 3 keynotes, and up to 57 conference paper presentations are planned. Besides training proposals and research paper presentations, we need help in other roles, such as paper discussants, session chairs, and panel organizers. Also, please encourage your graduate students to attend as well. The deadline for proposals is extended to April 15.

The annual meeting offers a unique opportunity in accounting information systems and related areas, both in terms of learning hands-on, and by sharing with others relevant technology and tools, curriculum innovations, and research. The meeting offers a very friendly, informal environment for networking and sharing ideas and resources.

We hope to see you in Copper this summer.

Best Wishes.

Sincerely,

Vasant Raval, 
Conference Chair AIS Educator Association (vraval@creighton.edu) 

 

Message regarding the forthcoming European Conference on Accounting Information Systems
From Andrew Lymer [A.LYMER@bham.ac.uk] 

Whilst particularly for those of you who are attending ECAIS 2002 in April in Copenhagen, others may be interested in the materials which have been posted up to our website today for one of our workshops - on Researching ERP systems, to be given by Ben Wier (with assistance from Niels Dechow). The website pages can be access at http://accountingeducation.com/ecais  - see Keynote and Worskshops link.

Ben and Niels have offered up four papers to be examined prior to attending this workshop to illustrate different approaches to researching this topic area as used by them, and other researchers, in the recent past.

Two of these papers are working papers (please respect this status and ask permission of the respective authors if you wish to use them subsequently) and two are papers awaiting publication where copyright should also be respected, and correct citation made where appropriate.

Further information on other other two workshops (on Case based reasoning research and ECommerce research) and keynote speech will be added to the website in the near future.

We look forward to welcoming as many of you as can attend to the conference.

Regards

Andy Lymer University of Birmingham, 
UK on behalf of the ECAIS 2002 Chairs and organisers.

March 28 message from Graziella Michelante [michelante@eiasm.be] 

With this message, I would like to remind you the following events :

Workshop on Accounting and Economics V
When : June 20-21, 2002
Where : Madrid, Spain
Submission deadline : March 31, 2002 !!
Web site : http://www.eiasm.be/events/WsAccountingEconomics.html 

International Conference on Accounting, Auditing & Management in Public Sector Reforms
When : September 5-7, 2002
Where : Dublin, Ireland
Web site : http://www.eiasm.be/events/WsDublin.html 

Workshop on Accounting in Historical Perspective
When : December 5-6, 2002
Where : Lisbon, Portugal
Web site : http://www.eiasm.be/events/2002.12.5-6.html 

3rd Conference on New Directions in Management Accounting : Innovations in Practice and Research
When : December 12-14, 2002
Where : Brussels, Belgium
Web site : http://www.eiasm.be/events/3rd_Conference_ON_New_Directions.html 

International Workshop on Management and Anthropology
When : September 12-14, 2002
Where : Venice, Italy
Web site : http://www.eiasm.be/events/WsManagement&Anthropology.html 

Sincerely,
Graziella Michelante

_______________________________

Graziella Michelante

EIASM Conference Manager

Rue d'Egmont 13 - 1000 Brussels - Belgium

Tel.: 32 2 5119116 - Fax : 32 2 5121929

 

March 30 message from Ho S. M., Simon (ACY) [simon@baf.msmail.cuhk.edu.hk] 

Dear Bob,

As you may know, I am chairing the Organizing Committee of the above Congress. I hope you have planned to attend this truly international event.

. . .

For more information of the Congress, please browse www.cuhk.edu.hk/acy/hkaaa/iaaer.html  I look forward to hearing from you soon.

Sincerely,

Simon S.M. Ho 
Chairman, Organizing Committee of the 9th WCAE

A new breed of customer service agents will be so attentive to your needs that you’ll never guess you’re talking to software.

"Are You Being Served?" by Joe Nickell, MIT's Technology Review, March 15, 2002 --- http://www.techreview.com/articles/nickell031502.asp 

Somehow it seems the more businesses cater to customers through the use of new technologies, the harder it is to get good service. It's hard to find a company of any size today that answers its phone or e-mail without first sending customers through a maze of touch-tone menus or voice prompts—"voice hell" always a 1-800 number away. Then there are online customer support centers: soulless lists of frequently asked questions, hyperlinked conceptual puzzles and unintuitive search engines that never quite answer the question at hand. "What customers very often end up wanting is an F-U button," jokes Dr. Rosalind Picard, an associate professor at MIT whose research examines the role of emotions in human-computer interactions.

Undaunted, technology providers and their corporate clients are pushing toward a future in which an increasing percentage of customer inquiries can be handled automatically and, hopefully, with better results. They aim to build so-called "service bots"—software-hardware hybrid systems that understand spoken or written English (or any other dialect or language preferred by the customer), interpret vague or broad queries, possess a thorough understanding of both the company's products and the customer's past interactions, and speak or write answers in an intelligible, context- and emotion-sensitive fashion. The necessary skill set for the perfect service bot demands several interdependent layers of technology: voice recognition modules, natural language understanding engines, artificial intelligence for data extraction and text-to-speech synthesizers.

Customers should like these new bots because they would be faster, more accurate and more consistent than live service agents, providing personalized interactions managed across any medium, available any time of the day. Companies will line up for the new technology in order to fend off ever-rising customer service costs and catastrophic call-center employee turn-over rates.

That's the premise, anyway. It may all sound pie-in-the-sky, but numerous technology companies, as well as research centers at leading academic institutions, are hammering away at the challenges of building a better service bot. The first generation is already here. Ford Motor Company employs a chatty online bot named Ernie, built by San Francisco-based NativeMinds, who helps technicians at its network of dealerships diagnose car problems and order parts. IBM's Lotus software division employs a service bot from Support.com that can examine a user's software, diagnose problems and fix them by uploading patches to the user's computer—without any necessary intervention by human tech support personnel.

And in an odd twist, Electronic Arts has built an entire game, called Majestic, around service bot technology built by San Francisco-based developer eGain. Majestic carries players through a complex, multi-media episodic mystery. Players receive clues and information via pager, fax, e-mail, Web sites and even telephone calls. eGain's service bot keeps track of player information such as what clues they've collected and how they have reacted. The software can handle 100,000 simultaneous player interactions.

But given the lousy track record of automated customer service so far, consumers have reason to be skeptical of this new generation of talking machines. Confusing or insufficient menu choices, lack of personalization, outdated or insufficient responses and failure to carry over punched-in account information to conversations with live reps rank at the top of consumer complaints about automated customer service systems today. Almost 40 percent of Americans press zero whenever they encounter an automated answering system, rather than waiting to hear the menu options, according to a study conducted in 1998 by the Center for Client Retention.

So will service bots truly give us better service, or will they simply allow companies to reinforce the walls between themselves and customers? Can we really hope for a better-than-human service bot? And, is it realistic to expect companies to deploy tomorrow's automated systems any better than they deploy today's?

"I don't think it's possible to even imagine a generic customer service [bot] that can handle any kind of question in any industry," says Joe Bigus, leader of the Agent Building and Learning Environment (ABLE) project at IBM Research. Bigus' research group has recently produced a toolkit that allows developers to build small software agents—programs that gather information and perform duties automatically—in Java. The toolkit consists of software code that provides baked-in machine learning capabilities and a set of instructions for customizing the software agents with specific domain knowledge. This allows developers to design any number of discreet agents that possess specialized knowledge and problem-solving capabilities; the agents can even interact with one another when faced with a complex problem.

By facilitating the deployment of a number of small, specialized software agents—rather than one massively complex agent—this approach mimicks the way human resources are managed: customer service agents at Sony aren't all trained to understand every product from audio cassettes to digital video cameras. Instead, small groups of service agents are given specific products to understand thoroughly.

Continued at http://www.techreview.com/articles/nickell031502.asp 

Bob Jensen's threads on speech recognition and text reading are at http://www.trinity.edu/~rjensen/245glosf.htm#Speech1 

From FEI Express on March 21, 2002

IBM included "A Road Map" in their 2001 Glossy Annual Report, a two-page narrative with helpful hints to walk you through their 51 pages of MD&A and provide some perspective before reading their financials. This is a great step towards making financial statements more understandable to the average reader and not so overwhelming. Take a look for yourself on their website at http://www.ibm.com/annualreport/2001/financial_reports/fr_index.html 

Caterpillar, on the other hand, took a different approach to their 2001 Glossy Annual Report. They opted for a glossy summary annual report that included consolidated financial statements, with detailed disclosures instead included as an appendix to their Proxy. You can view an electronic version of this report at http://www.caterpillar.com/about_cat/investor_information/pdf/YECX0014.pdf.  I've noticed that several companies this year have opted for a glossy Summary Report, with varying levels of detail in what's provided in that summary.

TenLinks.com: Ultimate Directories for Technology Professionals http://www.tenlinks.com/ 

communities, events, jobs, products and companies, reference, reviews, services and consultants, translation

FEA, CFD, products and companies, resources, reviews, services and consultants

TopTen Civil Engineering Sites, bridges, codes, dams, environment, geotechnical, hydrology, indoor/outdoor, IT in construction,  organizations, portals, reference, services, software, tall buildings, transportation

communities, consultants, data, education, events, jobs, products & companies, reference

communities, products and companies, reference, services and consultants, CAM, rapid prototyping, quality

Architecture
TopTen sites, builders' sites, built environment, home improvement, magazines, portals, sustainable architecture

Computers
computing for the disabled, hardware, hardware reviews, magazines, software 

Electronic Design (EDA)
TopTen EDA, products and companies

Engineering
civil, design, chemical, electrical, mechanical, collaboration, humor, jobs, magazines, references

Free Stuff
CAD, GIS, FEA, Internet access, general stuff

Mathematics
online solvers, math software, units

Tech Jobs
CAD, engineering, general, GIS/Mapping, quality

Technology
computers, free tech stuff, Internet, newsletters and digests

General Interest and Diversions
cycling, employment, folk medicine,  reference, salary calculators, satellite images, science, software, webcams

Bob Jensen's technology bookmarks are at http://www.trinity.edu/rjensen/bookbob4.htm 

Tate Online: Turner Collection -- http://www.tate.org.uk/collections/collection_search_simple.jsp?group=turner 

In 1856, nearly five years after Turner's death, his estate was settled by a decree in which the works found in his studio that were considered to be by his own hand were accepted by the nation as the 'Turner Bequest'. This comprises nearly 300 oil paintings and around 30,000 sketches and watercolours (including 300 sketchbooks). A group of nine paintings from the Bequest is retained at the National Gallery. View the Turner collection highlights View the Turner sketchbooks

While the great majority of the works by Turner in the Tate are from the Turner Bequest there are also a small number of oils, watercolours and prints which have been acquired independently.

Updates on FAS 133 Derivatives Accounting

March 22, 2002 Message from Risk Waters Group [RiskWaters@lb.bcentral.com] 

The Financial Accounting Standards Board (FASB) has ruled that undrawn loan commitments will not be subject to derivatives accounting rules, and do not have to be marked to market - a victory for commercial lenders. But, there may be a larger problem on the horizon for banks opposed to fair-value loan accounting. FASB, the US accounting standards-setter, also said it would add loans to its ongoing fair-value accounting project, through which it is devising mark-to-market accounting rules for all financial instruments.

The International Monetary Fund became the latest critic of credit derivatives. It believes the lack of financial disclosure and transparency in the credit derivatives market has the potential to increase market risk, as participants find it more difficult to gauge the depth of credit deterioration caused by credit events.

Turnover in equity index contracts at Asian exchanges, meanwhile, rose by 40% in the fourth quarter of last year, according to the latest quarterly report from the Bank for International Settlements (BIS). The Switzerland-based banking body pointed to the rapid development of options trading in Korea as leading the charge.

In a blow to new market development, Italy's IntesaBCI shelved its plans to trade weather derivatives this year.

Christopher Jeffery Editor, 
RiskNews 
http://www.risknews.net  
mailto:cjeffery@riskwaters.com 

Interesting Business History in the Context of the Enron Scandal

A very interesting story, much more so than 'The Untouchables'...

The key accountant if there was one, was actually one of his lawyers, Edward O'Hare, who advised Capone on business ventures. 'Fast Eddie' O'Hare became a prominent lawyer and was involved in many businesses with Capone. During Capone's imprisonment for the Valentine's Day massacre in 1929, the laws had been changed to enable taxation of illegally earned profits. Capone and his associates, including Eddie, became a focus of IRS operations in 1930.

Fast Eddie decided to turn on Capone to settle up with the IRS. This was a breakthrough for the IRS. In addition, a set of accounts seized years earlier was properly analyzed provided further evidence of Capone's illegal earnings.

A very interesting wrinkle was that Eddie planned ahead for his son Butch. Terms of the deal with the Feds included acceptance of Butch at Annapolis. Eddie cooperated, and Capone was convicted.

In November, 1939, Eddie was executed by mob associates for cheating another boss, Frank Nitti, on a deal, and perhaps as (somewhat overdue) payback for Capone. According to http://www.alleged-mafia-site.com/tuohy/ohare.html  several months later, Nitti married Eddie's fiance (Eddie had divorced Butch's mother much earlier).

In the meantime, Butch graduated from Annapolis, and in 1942 became a war hero, the first US Navy Ace, by single-handedly downing 5 Japanese bombers and buying time that saved the carrier USS Lexington from destruction. According to http://www.alleged-mafia-site.com/tuohy/ohare.html  President Roosevelt called his outstanding performance, "One of the most daring, if not the most daring, single action in the history of combat aviation." He was subsequently shot down at night in Nov, 1943 and lost at sea.

In 1949, Col. Robert H. McCormick, publisher of the Chicago Tribune, led the charge to rename the Chicago-area airport (formerly named Orchard Field) to O'Hare's International Airport. And so it is named today.

I wonder if anyone from Enron is making similar deals...

Other links:

http://www.alleged-mafia-site.com/tuohy/ohare.html 

http://wy.essortment.com/alcaponegangst_rwdl.htm 

http://www.ohare.com/ohare/about/about_butch.shtm

Kevin Kobelsky PhD CA*CISA
Assistant Professor Leventhal School of Accounting,
Marshall School of Business
University of Southern California Accounting Building
125 Los Angeles, CA 90089-0441 Voice: (213) 740-0657 Fax: (213) 747-2815

March 24 message from Emanuel Schwarz 

In case you are interested in this new developed Managerial Cost accounting, will you please open my website: www.InternalAccounting.com  or just click here: IAE Home Page

You will see a totally new concept of Internal Accounting. We have now separated the External-Financial Accounting from the Internal one. A very important step ahead.

Please, let me hear from you with all your observations and comments.

God bless you there.

Sincerely yours,

Emanuel Schwarz Professor Emeritus, Ph.D.

 

From The Wall Street Journal Accounting Educators' Review on March 21, 2001

TITLE: Berkshire Hathaway Changes Accounting of Its Berkadia Stake 
REPORTER: Reuters DATE: Mar 18, 2002 
PAGE: A6 
LINK: Print Only (Not online) 
TOPICS: Accounting Changes and Error Corrections, Accounting For Investments, Consolidation, Equity, Financial Accounting, Accounting, Financial Analysis, Financial Statement Analysis, Investments

SUMMARY: An accounting change will increase assets and liabilities of Berkshire Hathaway by $5.5 billion. The change is related to investments in Berkadia.

QUESTIONS: 

1.) Describe Berkshire Hathaway's investment in Berkadia. Prior to the accounting change, how did Berkshire Hathaway account for the investment? How is Berkshire Hathaway currently accounting for the investment? Why are assets and liabilities higher under the new accounting method? Why are there no changes to net income or equity under the new accounting method?

2.) What are the differences between the cost method and the equity method of accounting for investments? What factor(s) determine the appropriate method? When should investments be accounted for by consolidation of financial statements?

3.) What happened to Berkshire Hathaway's share price? What was the percentage change? Why do you think the price changed? Could the change in accounting treatment have affected share price? Support your answer.

Reviewed By: Judy Beckman, University of Rhode Island 
Reviewed By: Benson Wier, Virginia Commonwealth University 
Reviewed By: Kimberly Dunn, Florida Atlantic University

From The Wall Street Journal Accounting Educators' Review on March 21, 2001

TITLE: Audit Cleanup: New Oversight Is Proposed by Blue-Chip Firms 
REPORTER: Cassell Bryan-Low and Michael Schroeder 
DATE: Mar 20, 2002 
PAGE: C1 
LINK: http://online.wsj.com/article/0,,SB10165764708550520.djm,00.html  
TOPICS: Auditing

SUMMARY: The FEI has proposed changes in regulation over the auditing profession to include a new oversight body staffed with finance and accounting professionals knowledgeable about, but independent from, the industry. As well, the group proposes a minimum two-year delay before auditors who are leaving the profession may begin working for their audit clients. They also support streamlining the Financial Accounting Standards Board's operations.

QUESTIONS: 
1.) Describe the changes proposed by the FEI that are highlighted in the article. As described in the article, how do these proposed changes differ from some other proposals currently being discussed?

2.) What is the "outgoing Public Oversight Board"? Two members of that Board, Charles Bowsher and Aulana Peters, testified before Congress this week. With whose proposed reforms do those two individuals express concern? Comment on what you think they are concerned about and why.

3.) Who pays for oversight of the accounting and auditing profession? How does the FEI propose that the new regulation efforts be funded? Why do you think they make this proposal?

Reviewed By: Judy Beckman, University of Rhode Island 
Reviewed By: Benson Wier, Virginia Commonwealth University 
Reviewed By: Kimberly Dunn, Florida Atlantic University

Congratulations to Baruch Lev from NYU --- http://www.stern.nyu.edu/~blev/main.html 

Baruch's picture adorns the cover of Financial Executive, March/April 2002 --- http://www.fei.org/magazine/marapr-2002.cfm 

The cover story entitled "Rethinking Accounting:  Intangibles at a Crossroads:  What Next?" on pp. 34-39 --- http://www.fei.org/magazine/articles/3-4-2002_CoverStory.cfm 
The concluding passage is quoted below:

The Inertness and Commoditization of Intangibles 

Intangibles are inert - by themselves, they neither create value nor generate growth. In fact, without efficient support and enhancement systems, the value of intangibles dissipates much quicker than that of physical assets. Some examples of inertness: uHighly qualified scientists at Merck, Pfizer, or Ely Lilly (human capital intangibles) are unlikely to generate consistently winning products without innovative processes for drug research, such as the "scientific method," based on the biochemical roots of the target diseases, according to Rebecca Henderson, a specialist on scientific drug research, in Industrial and Corporate Change. Even exceptional scientists using the traditional "random search" methods for drug development will hit on winners only randomly, writes Henderson.

uA large patent portfolio at DuPont or Dow Chemical (intellectual property) is by itself of little value without a comprehensive decision support system that periodically inventories all patents, slates them by intended use (internal or collaborative development, licensing out or abandonment) and systematically searches and analyzes the patent universe to determine whether the company's technology is state-of-the-art and competitive.

uA rich customer database (customer intangibles) at Amazon.com or Circuit City will not generate value without efficient, user-friendly distribution channels and highly trained and motivated sales forces.

Worse than just inert, intangibles are very susceptible to value dissipation (quick amortization) - much more so than other assets. Patents that are not constantly defended against infringement will quickly lose value due to "invention around" them. Highly trained employees will defect to competitors without adequate compensation systems and attractive workplace conditions. Valuable brands may quickly deteriorate to mere "names" when the firm - such as a Xerox, Yahoo! or Polaroid - loses its competitive advantage. The absence of active markets for most intangibles (with certain patents and trademark exceptions) strips them of value on a stand-alone basis.

Witness the billions of dollars of intangibles (R&D, customer capital, trained employees) lost at all the defunct dot-coms, or at Enron, or at AOL Time Warner Co., which in January 2002 announced a whopping write-off of $40-60 billion - mostly from intangibles.

Intangibles are not only inert, they are also, by and large, commodities in the current economy, meaning that most business enterprises have equal access to them. Baxter and Johnson & Johnson, along with the major biotech companies, have similar access to the best and brightest of pharmaceutical researchers (human capital); every retailer can acquire the state-of-the-art supply chains and distribution channel technologies capable of creating supplier and customer-related intangibles (such as mining customer information); most companies can license-in patents or acquire R&D capabilities via corporate acquisitions; and brands are frequently traded. The sad reality about commodities is that they fail to create considerable value. Since competitors have equal access to such assets, at best, they return the cost of capital (zero value added).

The inertness and commoditization of most intangibles have important implications for the intangibles movement. They imply that corporate value creation depends critically on the organizational infrastructure of the enterprise - on the business processes and systems that transform "lifeless things," tangible and intangible, to bundles of assets generating cash flows and conferring competitive positions. Such organizational infrastructure, when operating effectively, is the major intangible of the firm. It is, by definition, noncommoditized, since it has to fit the specific mission, culture, and environment of the enterprise. Thus, by its idiosyncratic nature, organizational infrastructure is the major intangible of the enterprise.

Focusing the Intangibles Efforts 

Following Phase I of the intangibles work, which was primarily directed at documentation and awareness-creation, it's now time to focus on organizational infrastructure, the intangible that counts most and about which we know least. It's the engine for creating value from other assets. Like breaking the genetic code, an understanding of the "enterprise code" - the organizational blueprints, processes and recipes - will enable us to address fundamental questions of concern to managers and investors, such as those raised above in relation to H-P/Compaq and Enron.

Organizational Infrastructure By Example: A company's organizational infrastructure is an amalgam of systems, processes and business practices (its operating procedures, recipes) aimed at streamlining operations toward achieving the company's objectives. Following is a concrete example of a business process, part of the organizational infrastructure, which was substantially modified and thereby created considerable value. This was adopted from "Turnaround," Business 2.0, January 2002.

Nissan Motor Co. Ltd., Japan's third-largest automaker and a perennial loser and debt-ridden producer of lackluster cars, received in March 1999 a new major shareholder, Renault, and a new CEO, Carlos Ghosn, both imported from France. Ghosn moved quickly to transform Nissan into a viable competitor, and indeed, in the fiscal year ending March 2001, the company reported a profit of $2.7 billion, the largest in its 68-year history.

How was this miracle performed? Primarily by cost-cutting, achieved by a drastic change in the procurement process. Here briefly, is the old process: Nissan's buyers were locked into ordering from keiretsu partners, suppliers in which Nissan owned stock. The guaranteed stream of Nissan orders insulated those suppliers from competition. Suppliers can't specialize and can't sell excess capacity elsewhere. Each supplier was assigned a shukotan, Nissan-speak for a relationship manager. It was the shukotan who would negotiate price discounts - but favors got in the way.

Here, in brief, is the new procurement process, as drastically changed by Ghosn: Ghosn gave Itaru Koeda, the purchasing chief, authority to place orders without regard to keiretsu relationships - and, more important, insisted that he use it. Then, a Renault executive and Koeda dumped the shukotan system, instead assigning buyers responsibility by model and part. They formed a sourcing committee to review vendor price quotes on a global basis. "This is the best change in our process," Koeda says. "Suppliers are specializing in what they do best, making them more efficient."

The results? An 18 percent drop in purchasing costs, which was the major contributor to Nissan's transformation from a loss to a profit. Ghosn's next major set of tasks: To change the car design process in order to enhance the top line, sales; to rid Nissan of the myriad design committees and hierarchies that stifle and slow innovation; and to institute an efficient, effective innovative process.

Baruch's cover story is accompanied by "Fixing Financial Reporting:  Financial Statement Overhaul," by  Robert A Howell, pp. 40-42 --- http://www.fei.org/magazine/articles/3-4-2002_Howell_CoverStory.cfm 

Financial reporting is broken and has to be fixed - and fast! If it isn't, we will continue to see more cases such as Xerox, Lucent, Cisco Systems, Yahoo! and Enron. Xerox's market value is down 90 percent, or $40 billion, in the past two years. In the same period other market losses include; Lucent, down more than $200 billion; Cisco Systems, off more than $400 billion; Yahoo!, more than $100 billion; and Enron, down more than $60 billion in the largest bankruptcy of all time.

Some argue that these are extreme examples of "irrational exubuerance." Some in the accounting profession say that such cases represent a small percentage of the aggregate number of statements audited - some 15,000 public company registrants. Perhaps. But a financial reporting framework that permits these companies to suggest that they are doing well, and, by implication, to justify market valuations which, subsequently, cost investors trillions in the aggregate, is unconscionable.

Financial reporting, especially in the U. S., with its very public capital markets, has reached the point where "accrual-based" earnings are almost meaningless. Reported earnings are driven as much by "earnings expectations" as they are by real business performance. Balance sheets fail to reflect the major drivers of future value creation - the research and product, process and software development that fuel high technology companies, and the brand value of leading consumer product companies. And, cash flow statements are such a hodge-podge of operating, investing and financing activities that they obfuscate, rather than illuminate, business cash flow performance.

The FASB, in its Concept No. 1, states, "financial reporting should provide information that is useful to present and potential investors and creditors and other users in making rational investment, credit and similar decisions." This is simply not so.

The primary financial statements - income statement, balance sheet and cash flow statement - which derive their foundation from an industrial age model, need major redesign if they are to serve as the starting point for meaningful financial analysis, interpretation and decision-making in today's knowledge-based and value-driven economy. Without significant redesign, ad hoc definitions such as pro forma earnings, returns and cash flows will continue to proliferate. So will significant reporting "surprises!"

Starting Point: Market Value Creation
The objective of a business is to increase real shareholder value - what Warren E. Buffett would call the "intrinsic value" of the firm. It's a very basic idea: Investors get "returns" from dividends and realized market appreciation. Both investments and returns are measured in cash terms, so individuals and investors invest cash in securities with the objective of realizing returns that meet or exceed their criteria. If their judgments are too high, and that later becomes clear, the market value of the firm will drop. If judgments are too low and cash flows turn out to be stronger, market values increase.

From a managerial viewpoint, the objective of increasing shareholder (market) value really means increasing the net present value (NPV) of the future stream of cash flows. Note, "cash flows," not "profits." Cash is real; profits are anything, within reason, that management wants them to be. If revenues are recognized early - or overstated - and expenses are deferred or, in some cases, accelerated to "clear the decks" for future periods, resulting earnings may show a nice trend, but do not really reflect economic performance.

There are only three ways management may increase the real market, or "intrinsic," value of a firm. First, increase the amount of cash flows expected at any point in time. Second, accelerate cash flows; given the time value of money, cash received earlier has a higher present value. Third, if a firm is able to lower the discount rate that it applies to its cash flows - which it frequently can - it can raise its NPV.

Given that cash flows drive market value, financial statements should put much more emphasis on cash flows. The statement of cash flows now prescribed by the accounting community and presented by management is not easily related to value creation. Derived from the income statement and balance sheet, it's effectively a reconciliation statement for the change in the balance of the cash account. A major overhaul of the cash flow statement would directly relate to market valuations.

Cash Earnings and Free Cash Flows
Managers and investors should focus on "cash earnings" and the reinvestments that are made into the business in the form of "working capital" and "fixed and other (including intangible) investments." The net amount of these cash flows represent the business's "free cash flows."

With negative cash flows - frequently the case for young startups and high-growth companies - a business must raise more capital in the form of debt or equity. The sooner it gets its free cash flows positive, the sooner it'll begin to create value for shareholders. Positive free cash flows provide resources to pay interest and pay down debt, to return cash to shareholders (through stock repurchases or dividends) or to invest in new business areas.

The traditional cash flow statement purportedly distinguishes between operating, investing and financing cash flows, and has as its "bottom line" the change in cash and cash equivalents. In fact, the operating cash flows include the results of selling activities, investing in working capital and interest expense, a financing activity. Investing cash flows include capital expenditures, acquisitions, disposals of assets and the purchase and sale of financial assets. Financing cash flows consist of what's left over.

Indeed, the bottom-line change in cash is not a useful number, other than to demonstrate that it may be reconciled with the change in the cash account. If one wants a positive change in cash, simply borrow more. These free cash flows ultimately drive market value, and should be the focus of managers and investors alike.

Replacing Income With Cash Earnings
The traditional "profit and loss," or "income," statement needs modification in three ways, two of which are touched on above, along with a name-change, to "Operating Statement." That would suggest a representation of the business' current operations, without the emphasis on accrual-based profits.

Interest expense (income) should be eliminated from the statement, as it represents a financing cost rather than an operating cost. A number of companies do this internally to determine "net operating profit after taxes" (NOPAT). Also, NOPAT needs to be adjusted for the various non-cash items, such as depreciation, amortization, gains and losses on the sale of assets, tax-timing differences and restructuring charges - which affect income but not cash flows. The resultant "cash earnings" better represents the current economic performance of a business than accrual income and, very importantly, is much less susceptible to manipulation.

A third adjustment is the order in which the classes of expenses are displayed. Traditional income statements report cost of goods sold or product costs first, frequently focus on product gross margins, and then deduct, as a group, other expenses such as technical, selling and administrative expenses. This order made sense in the industrial age when product costs dominated. It does not for many of today's high-tech or consumer product companies. It would be more useful for companies to report expenses in an order that reflects the flow of the business activities. One logical order that builds on the concept of a business' value chain, is to categorize costs into development costs, product (service) conversion costs, sales and customer support costs and administrative costs.

Reinvesting in the Business
For most companies - especially those with significant investments that are being depreciated or amortized - cash earnings will be significantly higher than NOPAT. Unfortunately, cash earnings are not free cash flows because most businesses have to reinvest in working capital, property, plant and equipment and intangible assets, just to sustain - let alone increase - their productive capabilities.

As a business grows in sales volume, assuming that it offers credit to its customers who pay with the same frequency, accounts receivable will increase proportionately. As sales volumes increase, so, too, will product costs, inventories and accounts payable balances. Working capital - principally receivables, inventories, and payables - will tend to increase proportionately with sales growth, and will require cash to finance it. The degree to which it grows is a function of receivables terms and collection practices, inventory management and payables practices.

Companies such as Dell Computer Corp. collect payments up front, turn inventories in a few days and pay their vendors when due. The net effect is that as Dell grows it actually throws off cash, rather than requiring it to support increases in working capital. Most companies are not as efficient; the amount of cash needed to support increases in working capital can be as much as 20-25 percent of any sales increase. The degree to which working capital increases as sales increase is an important performance metric. Lower is better, which absolutely flies in the face of such traditional measures of liquidity as "working capital" and "quick" ratios, for which higher has been considered better.

Balance sheets ought to reflect investments that represent future value. What drives value for many businesses in today's knowledge-based economy - pharmaceuticals, high technology, software and brand-driven consumer product companies - is the investments in R&D, product, process and software development, brand equity and the continued training and development of the work force. Yet, based on generally accepted accounting principles (GAAP) accounting, these "investments" in the future are not reflected on balance sheets, but, rather, expensed in the period in which they are incurred.

A frequent argument for "expensing" is the unclear nature of the investments' future value. Apparently, investors believe otherwise, evidenced by the ratio of market values to book values having exploded in the past 25 years. In 1978, the average book-to-market ratio was around 80 percent; today it is around 25 percent. In the early 1970s, when accounting policies were established for R&D, product lines were narrower and life cycles longer, resulting in R&D being a much less significant element of cost. Expensing was less relevant. Now, with intangible assets having become so central and significant, expensing - rather than capitalizing and amortizing them over time - results in an absolute breakdown of the principle of "matching," which is at the heart of accrual accounting. The world of business has changed; accounting practices must also change.

Financial Statement Overhaul
Financial statements need marked overhaul to be useful for analysis and decision-making in today's knowledge-driven and shareholder value-creation environment. The proposed changes fall into three categories:

First - Move to a much more explicit shareholder (market) value creation and cash orientation, and away from accrual accounting profits and return on investment calculations predicated on today's accounting policies. Start with a shareholder perspective for cash flows, then reconstruct the statement of cash flows to clearly provide the free cash flows that the business' operations are generating. Cash earnings and reinvestments in the business comprise free cash flows.

Second - Expand the definition of investments to include intangibles, which should be capitalized as assets and amortized according to some thoughtful rules. This will better reflect investments that have potential future value.

Third - Change the title to "operating statement" and other "housekeeping" of financial statements, to include categorizing costs in a more logical "value chain" sequence and aggregating all financial transactions, such as interest and the purchase and sale of securities, as financing activities.

Value creation is ultimately measured in the marketplace, so it stands to reason that if a firm's market value increases consistently, over time, and can be supported by improvements in its cash generation performance, real value is being created. For this to happen, the place to start is by fixing the financial statements. 

Bob Jensen's threads on accounting theory are at http://www.trinity.edu/rjensen/theory.htm 

March 24 message from Andrew Lymer [A.LYMER@bham.ac.uk] 

ECAIS 2002

Copenhagen Business School, Copenhagen

23-24th April, 2002

The conference programme for the forthcoming European Conference on Accounting Information Systems has been added to the Conference series website at http://accountingeducation.com/ecais  .

This includes:

- the Conference Schedule (draft) - copies of the invited papers - copies of the other accepted papers for presentation

We invite you to access our website and examine these materials.

Further details of our three workshops and our keynote speaker will be added in the near future.

As organisers of this year's conference we believe this event will be of great interest to anyone associated with accounting or information systems. We encourage you to consider attending the event if you have not already booked. Full booking details are also available on the above website. The event this year only costs 50 Euro due to the very generous sponsorship we have received in support of this conference.

This event immediately precedes the European Accounting Association Annual Congress - held at the same venue 25-27th April. See their website for further details of this event - http://www.eaa-online.org 

We hope to see as many of you as can make it to Copenhagen at the end of April.

Regards

Andy Lymer 
Eddy Vaassen 
im Hunton
Joint Chairs - ECAIS 2002.

 

Dictators of the World:  Past and Present,  Best to Worst (History, Government) 
The Dictatorship.com --- http://www.thedictatorship.com/ 

A Web Training Course From the U.K.
Becoming WebWise http://www.bbc.co.uk/webwise/learn/index.shtml 

Welcome to BBC Becoming WebWise! This new online course is the easy way to get to grips with the Internet. It lets you learn at your own pace and can lead to a nationally recognised qualification. Enrol at your local college for one of the accredited qualifications.

The eight key sections, or trips, will take you through the Internet basics in a simple and easy to follow format. Remember, you can return to any of the sections as often as you like. It will probably take you about ten hours to complete the course. Becoming WebWise will help you find out about getting connected, e-mailing, searching, bookmarking, making your own address book and the very basics of building your own web page. You will also learn about technological developments like Digital TV and WAP phones, your legal rights online, the history of the net, and the other ways in which you might get online. As you progress through the course, you will be able to see your scores by visiting your scorecard. This will tell you which trip and landmarks you have visited and also your scores in our tasks and quizzes. It is important to log out at the end of your visit so that your scores and progress will be saved. Remember: in order to obtain the accredited qualification you must enrol at a local college. Use our national coursefinder section to find one. Use the Register or Log In link to get a scorecard. If you would like to enter Becoming WebWise without registering or logging in then use this link: Enter Becoming WebWise

University of Texas at San Antonio (UTSA) Workshop Schedule

Below is a link to the web page which contains the revised schedule for our colloquia as well as copies of the papers to be presented. Again, I would like to invite your faculty to attend any workshops that are of interest to them. Please share this schedule with interested faculty. Thank you,

Rick Hatfield

http://business.utsa.edu/departments/acc/arc/arc.htm 

African History and Geography (Photographs)
American Museum of Natural History Congo Expedition --- http://diglib1.amnh.org/ 

March 25, 2002 message from Richard Newmark [richard.newmark@phduh.com] 

Bob,
I thought you might be interested in this.
Rick
-------------------------
Richard Newmark
Assistant Professor of Accounting
University of Northern Colorado
Kenneth W. Monfort College of Business
Campus Box 128
Greeley, CO  80639
(970) 351-1213 Office
(801) 858-9335 Fax (free e-mail fax at efax.com)
richard.newmark@PhDuh.com
http://PhDuh.com 

IRS finalizes hedging regs with liberalizations
TD 8985; Reg. § 1.1221-2, Reg. § 1.1256(e)-1
IRS has issued final regs for determining the character of gain or loss from hedging transactions.
Background. As a result of a '99 law change, capital assets don't include any hedging transaction clearly identified as such before the close of the day on which it was acquired, originated, or entered into. (Code Sec. 1221(a)(7)) Before the change, IRS had issued final regs in '94 providing ordinary character treatment for most business hedges. Last year, IRS issued proposed changes to the hedging regs to reflect the '99 statutory change (see Weekly Alert ¶ 6 2/1/2001). IRS has now finalized the regs with various changes, many of which are pro-taxpayer. The regs apply to transactions entered into after Mar 19, 2002. However, the Preamble states that IRS won't challenge any transaction entered into after Dec. 16, '99, and before Mar. 20, 2002, that satisfies the provisions of either the proposed or final regs.

Hedging transactions. A hedging transaction is a transaction entered into by the taxpayer in the normal course of business primarily to manage risk of interest rate, price changes, or currency fluctuations with respect to ordinary property, ordinary obligations, or borrowings of the taxpayer. (Code Sec. 1221(b)(2)(A)(i); Code Sec. 1221(b)(2)(A)(ii)) A hedging transaction also includes a transaction to manage such other risks as IRS may prescribe in regs. (Code Sec. 1221(b)(2)(A)(iii)) IRS has the authority to provide regs to address nonidentified or improperly identified hedging transactions (Code Sec. 1221(b)(2)(B)), and hedging transactions involving related parties. (Code Sec. 1221(b)(3))

Key changes in final regs. The final regs include the following changes from the proposed regs.

... Both the final and the proposed regs provide that they do not apply to determine the character of gain or loss realized on a section 988 transaction as defined in Code Sec. 988(c)(1) or realized with respect to any qualified fund as defined in section Code Sec. 988(c)(1)(E)(iii). The proposed regs also provided that their definition of a hedging transaction would apply for purposes of certain other international provisions of the Code only to the extent provided in regs issued under those provisions. This is eliminated in the final regs because the other references were to proposed regs and to Code sections for which the relevant regs have not been issued in final form. The Preamble states that later regs will specify the extent to which the Reg. § 1.1221-2 hedging transaction rules will apply for purposes of those other regs and related Code sections.

... Several commentators noted that the proposed regs used risk reduction as the operating standard to implement the risk management definition of hedging. They found that risk reduction is too narrow a standard to encompass the intent of Congress, which defined hedges to include transactions that manage risk of interest rate, price changes or currency fluctuations. In response, IRS has restructured the final regs to implement the risk management standard. No definition of risk management is provided, but instead, the rules characterize a variety of classes of transactions as hedging transactions because they manage risk. (Reg. § 1.1221-2(c)(4); Reg. § 1.1221-2(d))

... The proposed regs provided that a taxpayer has risk of a particular type only if it is at risk when all of its operations are considered. Commentators pointed out that businesses often conduct risk management on a business unit by business unit basis. In response, the final regs permit the determination of whether a transaction manages risk to be made on a business-unit basis provided that the business unit is within a single entity or consolidated return group that adopts the single-entity approach. (Reg. § 1.1221-2(d)(1))

RIA observation: As a result of the two foregoing changes made by the final regs, more transactions will qualify as hedging transactions. This is good for taxpayers because any losses from the additional transactions qualifying as hedges will be accorded ordinary treatment.

... In response to comments, the final regs have been restructured to separately address interest rate hedges and price hedges. (Reg. § 1.1221-2(d)(1)(iv); Reg. § 1.1221-2(d)(2))

... In response to comments, the final regs provide that a transaction that converts an interest rate from a fixed rate to a floating rate or from a floating rate to a fixed rate manages risk. (Reg. § 1.1221-2(d)(2))

... The final regs provide that IRS may identify by future published guidance specified transactions that are determined not to be entered into primarily to manage risk. (Reg. § 1.1221-2(d)(5))

... The proposed regs sought comments on expanding the definition of hedging transactions to include transactions that manage risks other than interest rate or price changes, or currency fluctuations with respect to ordinary property, ordinary obligations or borrowings of the taxpayer. While comments were received, the final regs did not make any changes in this area. However, IRS continues to invite comments on the types of risks that should be covered, including specific examples of derivative transactions that may be incorporated into future guidance, as well as the appropriate timing of inclusion of gains and losses with respect to such transactions.

... With respect to the identification requirement, a rule has been added specifying additional information that must be provided for a transaction that counteracts a hedging transaction. (Reg. § 1.1221-2(f)(3)(v))

RIA Research References: For hedging transactions, see FTC 2d/FIN ¶ I-6218.01 ; United States Tax Reporter ¶ 12,214.80

Bob Jensen's threads on hedging are at http://www.trinity.edu/rjensen/caseans/000index.htm 

Forwarded by Scott Bonacker, CPA [scottbonacker@MOCCPA.COM] 

LOWELL, Mass.--(BUSINESS WIRE)--Jan. 30, 2002--With the March 15 IRS deadline for business tax filings approaching, accountants and business owners can access a free search tool at www.bizownerHQ.com to help determine the right IRS activity code for a business. A business tax return cannot be filed without an IRS business activity code. The IRS switched to a new industry classification system for these codes in 1998. Subsequently, many accountants complain they are often uncertain of which code to assign. bizownerHQ has frequently found activity code errors in reviewing tax returns for valuations

March 20, 2002
Aimster suits on hold after bankruptcy filing --- http://www.latimes.com/technology/la-000020204mar20.story?coll=la%2Dheadlines%2Dtechnology 

A federal judge in Chicago called a temporary halt to the music and movie industries' legal assault on Madster, the online file-swapping service formerly known as Aimster. The move came shortly after two of the targets of the industries' copyright-infringement lawsuit--BuddyUSA Inc. and AbovePeer Inc., which operate Madster--filed for bankruptcy protection.

Bob Jensen's P2P threads are at http://www.trinity.edu/rjensen/napster.htm 

The Efficient Auditor Newsletter is the most unique publication in the world of auditing. First, it's loaded with practical tips and ideas to improve your engagements. In addition, you'll find yourself smiling and even laughing as you read each issue. That's right-The Efficient Auditor is an auditing publication that you'll truly enjoy reading! http://www.accountingweb.com/members/auditwatch/resources.html 

Bob Jensen's practice tips are at http://www.trinity.edu/rjensen/fees.htm 

A free service called "FreeAnswers" can assist you in getting answers to many software packages' "help functions", such as Quicken, Excel, Pagemaker and more. http://www.accountingweb.com/item/75438 

Council on Foreign Relations http://www.cfr.org/index_public.html 

Businesses Won't Rush to Install XP Look for consumers to gobble up Windows XP as Microsoft's latest OS makes its debut, but businesses won't be so quick to jump on board, according to research by Gartner's Dataquest. http://www.newmedia.com/default.asp?articleID=3447 

An original Macintosh computer is now considered worthless. But the box it came in? It goes for hundreds of dollars on eBay --- http://www.wired.com/news/mac/0,2125,51208,00.html 

Five Quick MS Word Tips to Save You Time
Here are some helpful tips to help you save time and money during your day-to-day activities. http://www.accountingweb.com/item/75441 

March 22, 2002 message from Eckman, Mark S, CFCTR [meckman@att.com] 

Probably my last contribution while at AT&T. Mark S. Eckman, CPA Box 1923 340 Mt. Kemble Avenue Room N270-E130 Morristown NJ 07962-1923 Phone 973.326.3011 FAX 973.326.2699

Privacy Bird software is offered free from AT&T Labs. Individuals can set up their privacy guidelines, and then the Privacy Bird will tweet and change colors from green to yellow to red to inform users whether a Web site they are visiting complies with their privacy preferences. The free software is available at http://privacybird.com  .

BUSINESS Email Deployment Systems: A Step-By-Step Buyer's Guide Shopping for a system or provider that can handle your email, lists, data, and reporting? Here's how to define your needs and find the right match. http://www.newmedia.com/default.asp?articleID=3461 

Next Up for Financial Services: Wireless With wireless devices such as mobile phones approaching critical mass, GartnerG2 expects U.S. consumers to begin adopting such devices for wireless financial services. http://www.newmedia.com/default.asp?articleID=3455 

Those awful leisure suits and other items that were popular in the 1970s
JCPenney Catalog Fall/Winter 1980 --- http://www.excitementmachine.org/jc/ 

American Folklore (including hoaxes and tall tales) --- http://www.americanfolklore.net/ 

Welcome to American Folklore. This folklore site contains retellings of American folktales, Native American myths and legends, Tall Tales, weather folklore and ghost stories from each of the 50 states. Read about famous characters such as Paul Bunyan, Pecos Bill, Jesse James, Davy Crockett, Daniel Boone and many more. Choose a folktale from the list below, or browse one of our six categories.

Famous Characters

State Folktales

Historical Folklore

Regional Folktales

Tall Tales

Ethnic Folklore

 

My wife makes me eat so much roughage that I started passing wicker furniture.
Tim Conway at a performance at Trinity University on March 23.

Giving viagra to a person my age is like putting a new flag pole on a condemned building.
Harvey Korman at a performance at Trinity University on March 23.

But the "Pen on Viagra is Mighter" will slip through the smut filter!
A witness in the case to overturn library filters says that among the blocked pages was "The Pen Is Mightier" because the software read "penis." --- http://www.wired.com/news/politics/0,1283,51339,00.html 

Blasts of gamma rays targeted at flatulence-causing foodstuffs can eliminate the age-old problem of nose-scrunching noxious methane fumes, scientists from India say --- http://www.wired.com/news/medtech/0,1286,51354,00.html 
It is the title of the article that tries to be funny:  "Zap Those Buttock Burps Away"

A study showing that female squirrels are more likely to aid a family member with a familiar smell could go a long way toward proving that the "armpit effect" has merit --- http://www.wired.com/news/culture/0,1284,51330,00.html 

Forwarded by Todd Boyle [tboyle@ROSEHILL.NET] 

There are two new models of shredders featured in the Enron Mall in Business 2.0 this month http://www.business2.com/images/mag/enronmall.pdf 

The Shredmaster XT is a 250 HP motor that annihilates up to 1000 pages per second (the photo seems to resemble a municipal tree shredder trailer) But I can't understand how the shredmaster Ultra works.

Can somebody provide CPE Courses on these emerging issues?

On an airplane, I overheard a stewardess talking to an elderly couple in front of me.  Learning that it was the couple's 50th wedding anniversary, the flight attendant congratulated them and asked how they had done it.

"It all felt like five minutes . . ." the gentleman said slowly. 

The stewardess had just begun to remark on what a sweet statement tat was when he finished his sentence with a word that eanred him a sharp smack on the head: 

" . . . underwater."

Forwarded by Dick Haar

From The Original Hollywood Squares TV Show. These are from the days when game show responses were spontaneous and not scripted like they are now.

Q. Imagine you are a child in your mothers womb, can you detect light?
A. Paul Lynde: Only during ballet practice.

Q: If you're going to make a parachute jump, you should be at least how high? 
A: Charley Weaver: Three days of steady drinking should do it.

Q: True or false...a pea can last as long as 5,000 years. 
A: George Gobel: Boy it sure seems that way sometimes...

Q: You've been having trouble going to sleep. Are you probably a man or a woman? 
A: Don Knotts: That's what's been keeping me awake.

Q: According to Cosmo, if you meet a stranger at a party and you think he's really attractive, is it okay to come out directly and ask him if he's married? 
A: Rose Marie: No, wait until morning.

Q: What are "Do It", "I Can Help" and "Can't Get Enough"? 
A: George Gobel: I don't know but it's coming from the next apartment.

Q: As you grow older, do you tend to gesture more or less with your hands while you are talking? 
A: Rose Marie: You ask me one more growing older question, Peter...and I'll give you a gesture you'll never forget!

Q: Paul, why do Hell's Angels wear leather? 
A: Paul Lynde: Because chiffon wrinkles too easily.

Q: Charley, you've just decided to grow strawberries. Are you going to get any during your first year? 
A: Charley Weaver: Of course not, Peter. I'm too busy growing strawberries!

Q: In bowling, what's a perfect score? 
A: Rose Marie: Ralph, the pin boy.

Q: During a tornado, are you safer in the bedroom or in the closet? 
A: Rose Marie: Unfortunately, Peter, I'm always safe in the bedroom.

Q: When you pat a dog on its head he will usually wag his tail. What will a goose do? 
A: Paul Lynde: Make him bark.

Q: If you were pregnant for two years, what would you give birth to? 
A: Paul Lynde: Whatever it is, it would never be afraid of the dark.

Q: Is it possible for the puppies in a litter to have more than one daddy? 
A: Paul Lynde: Why, that bitch!

Q: While visiting China, your tour guide starts shouting "Poo! Poo! Poo!" What does that mean? 
A: George Goebel: Cattle crossing.

Q: Back in the old days, when Great Grandpa put horseradish on his head, what was he trying to do? 
A: George Gobel: Get it in his mouth.

Q: Who stays pregnant for a longer period of time, your wife or your elephant? 
A: Paul Lynde: Who told you about my elephant?

Q: When a couple have a baby, who is responsible for it's sex? 
A: Charley Weaver: I'll lend him the car. The rest is up to him.

Q: Jackie Gleason recently revealed that he firmly believes in them and has actually seen them on at least two occasions. What are they? 
A: Charley Weaver: His feet.

Q: Do female frogs croak? 
A: Paul Lynde: If you hold their little heads under water long enough.

Forwarded by Dr. Bernards

Next time you are washing your hands and complain because the water temperature isn't just how you like it, think about how things used to be. Here are some facts about how it was in the 1500s:

Most people got married in June because they took their yearly bath in May and still smelled pretty good by June. However, they were starting to smell, so brides carried a bouquet of flowers to hide the body odor.

Baths consisted of a big tub filled with hot water.  The man of the house had the privilege of the nice clean water, then all the other sons and men, then the women and finally the children. Last of all the babies were bathed. By then the water was so dirty you could actually lose someone in it. Hence the saying, "Don't throw the baby out with the bath water."

Houses had thatched roofs - thick straw, piled high, with little or no wood underneath. It was the only place for animals to get warm, so all the dogs, cats and other small animals (mice rats, and bugs)lived in the roof.

When it rained it became slippery, and sometimes the animals would slip and fall off the roof. Hence the saying,  "It's raining cats and dogs."

There was nothing to stop things from falling into the house. This posed a real problem in the bedroom where bugs and other droppings could really mess up your nice clean bed. Hence, a bed with big posts and a sheet hung over the top afforded some protection. That's how canopy beds came into existence.

The floors were usually dirt. Only the wealthy had something other than dirt. Hence the saying "dirt poor." The wealthy had slate floors that would get slippery in the winter when wet, so they spread thresh on the floor to help keep their footing.  As the winter wore on, they kept adding more, thresh until when they opened the door it would all start slipping outside.  A piece of wood was placed in the entranceway. Hence, a "thresh hold."

Folks cooked in the kitchen with a big kettle that always hung over the fire. Every day they lit the fire and added things to the pot. They ate mostly vegetables and did not get much meat. They would eat the stew for dinner, leaving leftovers in the pot to get cold overnight and then start over the next day. Sometimes the stew had food in it that had been there for quite a while. Hence the rhyme, "Peas porridge hot. Peas porridge cold. Peas porridge in the pot nine days old."

Sometimes they could obtain pork, which made them feel quite special. When visitors came over, they would hang up their bacon to show off. It was a sign of wealth that a man "could bring home the bacon." They would cut off a

>little to share with guests and would all sit around and "chew the fat."

Those with money had plates made of pewter. Food with a high acid content caused some of the lead to leak onto the food, causing lead poisoning and death. This happened most often with tomatoes, so for the next 400 years or so, tomatoes were considered poisonous.

Most people did not have pewter plates, but had "trenchers."  A trencher was a piece of wood with the middle scooped out like a bowl. Often trenchers were also made from stale pays and bread which was so old and hard that they could use them for quite some time. Trenchers were never washed and a lot of times worms and mold got into the wood and old bread. Often, after eating off wormy, moldy trenchers, one would get "trench mouth."

Bread was divided according to status. Hired workers got the burnt bottom of the loaf, the family got the middle, and special guests got the top, or "the upper crust."

Lead cups were used to drink ale or whiskey. The combination would sometimes knock a hefty drinker out for a couple of days.  Someone walking along the road would find these folks passed-out and take them for dead.  They would then be prepared for burial. A part of this preparation was that they would be "laid out" on the kitchen table for a couple of days and the family would gather around and eat and drink and wait and see if they would "wake up."  Hence, the custom of holding a "wake."

England is old and small and they started out running out of places to bury people. So they would dig up coffins and would take the bones to a "bone-house" and reuse the grave.  When reopening these coffins, one out of twenty-five coffins  were found to have scratch marks on the inside and they realized that in spite of holding their "wakes" they still had been burying some people alive. So they began to tie a string on the wrist of the corpse, lead it through the coffin and up through the ground. Above ground the string was tied to a bell. Someone would have to sit out in the graveyard all night to listen for the bell. Hence, the beginning of the term, "graveyard shift." If the bell rang, that person was, "saved by the bell!" If, after a week passed and the bell did not ring, the person was considered a "dead ringer."

Whoever said that "History" is boring.

And that's the way it was on March 31, 2002 with a little help from my friends.

In March 2000, Forbes named AccountantsWorld.com as the Best Website on the Web --- http://accountantsworld.com/.
Some top accountancy links --- http://accountantsworld.com/category.asp?id=Accounting

For accounting news, I prefer AccountingWeb at http://www.accountingweb.com/ 

Another leading accounting site is AccountingEducation.com at http://www.accountingeducation.com/ 

Paul Pacter maintains the best international accounting standards and news Website at http://www.iasplus.com/

How stuff works --- http://www.howstuffworks.com/ 

Bob Jensen's video helpers for MS Excel, MS Access, and other helper videos are at http://www.cs.trinity.edu/~rjensen/video/ 
Accompanying documentation can be found at http://www.trinity.edu/rjensen/default1.htm and http://www.trinity.edu/rjensen/HelpersVideos.htm 

Professor Robert E. Jensen (Bob) http://www.trinity.edu/rjensen
Jesse H. Jones Distinguished Professor of Business Administration
Trinity University, San Antonio, TX 78212-7200
Voice: 210-999-7347 Fax: 210-999-8134  Email:  rjensen@trinity.edu  

March 25, 2002

 Bob Jensen's New Bookmarks on March 25, 2002
Bob Jensen at Trinity University 

Quotes of the Week

The only time my education was interrupted was when I was in school.
George Bernard Shaw

The important thing is not to have a lot of ideas, but to live one of them.
Ugo Bernasconi

Beware of defining as intelligent only those who share your opinions .
Ugo Ojetti

Numbers 24, 55, and 98 among the 101 Dumbest Moments in Business reads as follows at http://www.business2.com/dumbest/

24. By faking the transactions that should have offset the risk in his portfolio, a trader named John Rusnak, working for a Baltimore subsidiary of Allied Irish Banks, loses $691.2 million before the bank discovers his misdeeds. After the bank and the federal government launch investigations, Rusnak is fired, denying him the chance to unseat Barings PLC's Nicholas Leeson -- who lost $1.4 billion and destroyed a 232-year-old company -- as the most inept rogue trader ever.

Nice going Lehman
55. Houston, We Have a Problem, Part 7: Richard Gross, an analyst at Lehman Bros., maintains a "strong buy" rating on Enron as the stock declines from $81 to $0.75. A Lehman spokesperson helpfully explains to the New York Times that the firm was advising Dynegy on its purchase of Enron's pipeline, and it is Lehman's policy not to change the firm's rating on any company involved in a deal in which Lehman is an adviser.

98. "Do you judge Ted Williams on one bad year?" -- Morgan Stanley analyst Mary Meeker, to Fortune magazine, explaining why it's unfair to criticize the fact that stocks on which she has maintained "outperform" ratings have lost more than 90 percent of their value. (For the record, Ted Williams's worst year was 1959. He played the season with a neck injury and still finished the year hitting a respectable .254.)

The notion that the goal of the professional accountant is public or social service is nonsense. His function is to provide the best possible possible service to his specific clients, the people who pay for his efforts. And in doing this his attitude is not one of independence or aloofness; instead he should be endeavouring to become as fully acquainted as practicable with each client's affairs and problems and be prepared to give constructive advice on his internal accounting methods, and all phases of financial measurement, review and planning. Fortunately, in actual practice, most accountants follow this path rather than accepting the posture of working in the interest of that elusive entity, the public or society at large. If I were a business owner or executive I certainly wouldn't engage an aloof accountant, bent on promoting the general welfare with me footing the bill. Of course, this doesn't imply that the accountant should condone or participate in any kind of crooked or destructive conduct. This point would be taken care of by emphasizing competence and integrity as qualifications rather than independence and public service.
William A. Paton stated in "Earmarks of a Profession- And the APB," Journal of Accountancy, January 1971)
(This quotation was forwarded by George Lan from the University of Windsor.

An ISOS consists of a thin layer of software (an ISOS agent) that runs on each "host" computer and a central coordinating system that runs on one or more ISOS server complexes. This veneer of software would provide only the core functions of allocating and scheduling resources for each task, handling communication among host computers and determining the reimbursement required for each machine. This type of operating system, called a microkernel, relegates higher-level functions to programs that make use of the operating system but are not a part of it. For instance, Mary would not use the ISOS directly to save her files as pieces distributed across the Internet. She might run a backup application that used ISOS functions to do that for her. The ISOS would use principles borrowed from economics to apportion computing resources to different users efficiently and fairly and to compensate the owners of the resources.
David P. Anderson and John Kubiatowicz, Scientific American --- http://www.sciam.com/2002/0302issue/0302anderson.html 

The following was forwarded last week by my wife's sister, Frannie, who lost her beautiful and talented fifteen year old daughter in a tragic traffic icy-road accident in Dousman, Wisconsin several years ago.  I am including it in New Bookmarks for one of my graduate students, Desiree Pratt, who lost her best friend in an auto accident in Houston on March 17 and Mary Jane, our office secretary whose mother is near death at this time.  I am also including it in New Bookmarks for Auntie Bev who writes:  "I am going through a very bad time in my life . . . as I am going to Pa. Friday morning and will be gone at least two weeks. My sister was diagnosed with: metastasized cancer with effect to the cerebral hemisphere (brain). This has come as a great shock to all of us, especially since my sister has not been sick."

If I Knew
It Would Be The Last Time
by Laura Horton

If I knew it would be the last  time
That I'd see you fall  asleep,
I would tuck you in more  tightly
and pray the Lord, your soul to  keep.

If I knew it would be the last  time
that I see you walk out the  door,
I would give you a hug and  kiss
and call you back for one  more.

If I knew it would be the last  time
I'd hear your voice lifted up in  praise,
I would video tape each action and  word,
so I could play them back day after  day.

If I knew it would be the last  time,
I could spare an extra  minute
to stop and say "I love  you,"
instead of assuming you would KNOW I  do.

If I knew it would be the last  time
I would be there to share your  day,
Well I'm sure you'll have so many  more,
so I can let just this one slip  away.

For surely there's always  tomorrow
to make up for an  oversight,
and we always get a second  chance
to make everything just  right.

There will always be another  day
to say "I love  you,"
And certainly there's another  chance
to say our "Anything I can  do?"

But just in case I might be  wrong,
and today is all I  get,
I'd like to say how much I love  you
and I hope we never  forget.

Tomorrow is not promised to  anyone,
young or old  alike,
And today may be the last  chance
you get to hold your loved one  tight.

So if you're waiting for  tomorrow,
why not do it  today?
For if tomorrow never  comes,
you'll surely regret the  day,

That you didn't take that extra  time
for a smile, a hug, or a  kiss
and you were too busy to grant  someone,
what turned out to be their one last  wish.

So hold your loved ones close  today,
and whisper in their  ear,
Tell them how much you love  them
and that you'll always hold them  dear

Take time to say "I'm  sorry,"
"Please forgive me," "Thank you," or  "It's okay."
And if tomorrow never  comes,
you'll have no regrets about  today.

This week's, March 25, updates on the Enron scandal and accounting fraud are in a separate document at http://www.trinity.edu/rjensen/fraud032502.htm 

Great Site of the Week (John Dallair led me to this site) --- http://www.exploratorium.edu/ 
Exploratorium, The Museum of Science, Art, and Human Perception

Housed within the walls of San Francisco's Palace of Fine Arts, the Exploratorium is a collage of over 650 science, art, and human perception exhibits. The Exploratorium is a leader in the movement to promote the museum as an educational center.

This unique museum was founded in 1969 by noted physicist and educator Dr. Frank Oppenheimer, who was director until his death in 1985.

Innovation of the Week:  Slide Rather Than Click!

IBM Glass Engine (Music) --- http://www.philipglass.com/glassengine/ 

The IBM glass engine enables deep navigation of the music of Philip Glass. Personal interests, associations, and impulses guide the listener through an expanding selection of over sixty Glass works.

The engine is currently compatible with MS Internet Explorer (4.5+) running on Windows 98, ME, 2000, or Apple OS 9, OS X platforms. Medium to high-bandwidth Internet access is highly recommended, but not absolutely required. Problems? See Frequently Asked Questions.

Forwarded by Cindy Happy

Ok, fellow "happy people". You need to take this test. Hope you are not color blind. HP: #1
http://www.colorgenics.com/ 

Tax Time 2002 http://lii.org/taxes 

The following resources include Web sites related to income tax preparation, taxation, sales tax, tax-related finance sites, the IRS and state taxation agencies, tax forms and publications, and finally (how we need it during tax season) a bit of humor.

All Tax Time 2002 Resources State (Primarily California) Federal Just For Fun

Bob Jensen's tax threads are at http://www.trinity.edu/rjensen/bookbob1.htm#010304Taxation 

Reply from Scott Bonacker, CPA [scottbonacker@moccpa.com] 

Thanks for the tax links.

This isn't specifically about you, but I came across http://www.mihov.com/eng/lc.html  while researching a network problem we are having, and I thought of how hard it is to maintain valid links on an extensive website like you have.

If this is wanted and useful, then I am happy to have helped.

Scott

 

The University of Michigan's Open Archives Initiative
OAlster --- http://oaister.umdl.umich.edu/ 

OAIster is a Mellon-funded project of the University of Michigan Digital Library Production Services. Our goal is to create a wide-ranging collection of free, useful, previously difficult-to-access digital resources (what are digital resources?) that are easily searchable by anyone.

The novelty of this service is multi-fold:

• Our service will reveal digital resources previously "hidden" from users behind web scripts (how are they hidden?). The OAI harvesting protocol we're using makes this possible.

• There won't be any dead ends. Users will not be retrieving merely information (metadata) about resources -- they will have access to the real things. For instance, instead of just the catalog records of a slide collection of Van Gogh's works, users will be able to view images of the actual works.

• The service will provide one-stop "shopping" for users interested in useful digital resources.

• Digital resources will be easily findable and viewable through our service. The middleware we use to index these resources makes this possible.

If you're interested in making your collection available for harvesting, please contact Kat Hagedorn.

If you're interested in easier access to digital resources, please check back for results on our survey about use of online resources. Further testing is in progress for the initial release of the service.

Message sent to Stanford, Yale, and Oxford alumni:

Renew your academic passion! This spring, Stanford, Yale and the University of Oxford are offering online courses to alumni and friends through the Alliance for Lifelong Learning, a joint venture among the three institutions – http://www.allLearn.org/stanford. 

Courses cover a range of contemporary subjects and are produced by distinguished faculty members of the three partner universities. Designed for your busy schedule, you can participate at times that are convenient for you. Spring 2002 offerings include:

Islam and the West World War II The Stock Market Emotional Intelligence Shakespeare The American Civil War Roman History

Click here to examine the complete online course catalog and register for classes: http://www.allLearn.org/stanford .

Spring courses start on April 15. Enrollments are limited and will be filled on a first-come, first-served basis, so please act now.

All Stanford alumni, family and friends are welcome to enroll. Please feel free to share this e-mail with others you know who may be interested in taking online courses offered by the Alliance.

Sincerely yours,

Howard Wolf President, 
Stanford Alumni Association

THANK YOU DU! --- http://www.dcb.du.edu/officeofdean/pressreleases/pressreleasedescription.asp?PressReleaseID=10 

I want to thank Peter Firmin and the faculty of accountancy at the University of Denver, the home of my MBA degree, for being such wonderful hosts during my visit last week.  In a March 15 panel, we solved all the problems, at least in theory,  regarding the future of the accountancy profession.  Peter is the former Dean of the colleges of business at both Tulane University and the University of Denver.  He resurfaced out of retirement as a fund raiser (Director of Development) for the University of Denver's School of Accountancy.   He and other top university administrators have done a fantastic job pulling DU out of its nearly-bankrupt state in the early 1980s.  DU is now ranked among the top 100 universities in the U.S.

With DU's various new buildings, including the fantastic new $25 million Daniels College of Business, its amazing growth in endowment, and the economic outlook for Denver and Colorado, I predict a dynamic and highly successful future for DU.  The Daniels College of Business has a very innovative, albeit expensive,  team-teaching curriculum with an excellent faculty and outstanding students.  See http://www.dcb.du.edu/accountancy/  

I also wish Peter and his wife, Jean, well on their forthcoming canoe adventure to four jungle camps in Peru and a planned trek into the wilds of Africa.  Erika and I are younger and less adventuresome.  Our idea of roughing it is being forced on occasion to downgrade to a four-star hotel.  

On Saturday, Erika and I spent a delightful day in one store in Denver.  It is called the Tattered Cover Bookstore and is located across from the Cherry Creek Shopping Mall.  It is more like a public library with comfortable furniture and quiet nooks to browse.  There is also a wonderful restaurant called the Fourth Story Restaurant and Bar in the bookstore.  I "read" (snore?) much better after a couple of cubalibras and a lobster lasagna lunch.  The Tattered Cover website is at http://www.tatteredcover.com/ 

Reply from Peter Firmin

My goodness, Bob

What a nice thing for you to do. Jean and I are finalizing our Zambia trip this afternoon and will be putting a deposit down on it. Even though it's a year-and-a-half away, the camps we plan to go to hold only 6 people - so we need to act now to save our spaces. The two-day canoe trips down the river require that we do the rowing. So I'm hoping that it is row, rest, look, take pictures, row, rest, rest, rest, etc. But just in case, I'm starting now to get in shape. We also have five days of walking safaris to look forward to.

Nice seeing you again. I'll just plan to take you up on your kind invitation to visit in San Antonio.

Peter

Reply from Kevin O'Brien [kobrien@du.edu] 
Kevin made an excellent presentation on CPA whistle blowing obligations.

Bob, thanks for the feedback; I have had several CPAs come up and tell me your presentation was very thought provoking!

My Powerpoint related to the presentation is on my website at the following URL: http://www.du.edu/~kobrien/whistleblowing.ppt 

You can also access it at www.du.edu/~kobrien  and follow the link to "CPA Ethics".

March 18 reply from George Lan [glan@UWINDSOR.CA] 

Bob Jensen wrote:

. In a > March 15 panel, we solved all the problems, at least in theory, regarding > the future of the accountancy profession.

Hi Bob,

Any earth-shattering solutions to the future of the accountancy profession? P.S. What is a cubalibra anyway? Some drink from Cuba? And did you find out by any chance what was the first degree of the taxi driver?

George Lan

In answer to George, I might note the following:

1. My earth-shattering accounting solutions are the arbitration and whistle blowing recommendations at http://www.trinity.edu/rjensen/FraudConclusion.htm#MyAnswer 
   
   
   
2. A Cubalibra is simply rum and coke with a squeezed slice of lime (the lime is vital to the flavor).  Apparently it was a favorite drink of Hemingway --- http://www.vertebrate.co.uk/overground/og7/cubalibra.html 
   
   
   There is also a song entitled La Cubalibra 
   
   
   
3. I did not find out any details about the taxi driver's first degree.  I don't think it was an online degree.

Distance Education Success:  A Sample of One Taxi Driver

On March 17, 2002 while returning home from the San Antonio Airport, I learned that our taxi driver was currently taking two distance education computer engineering courses via the Internet from SMU.  He said he really enjoyed this online education opportunity that was helping him walk in his father's footsteps (his father is a computer engineer).  SMU's Master of Science distance education program in engineering and computer science is at http://www.seas.smu.edu/disted/ 

Bob Jensen's threads on distance education programs are at http://www.trinity.edu/rjensen/crossborder.htm 

EDUCAUSE Review, Volume 37, Number 2
 The Table of Contents below gives you a peek at the articles in this issue. The full issue is online at http://www.educause.edu/pub/er/erm02/erm022w.asp .

FEATURES

Leading the IT Team: The Ultimate Oxymoron or the Ultimate Challenge? by J. GARY AUGUSTSON Changes driven by advancements in the information technology industry will define the ultimate challenge for future IT leaders as well as for senior managers of higher education institutions. http://www.educause.edu/ir/library/pdf/erm0220.pdf 

WINWINI and the Next Killer App: An Interview with Carl F. Berger by CAROLE A. BARONE "WINWINI will be most important in this killer app.... We need a killer app that operates and gets What I Need When I Need It." http://www.educause.edu/ir/library/pdf/erm0221.pdf 

Commonsense Ideas from an Online Survivor by HERMAN D. LUJAN By first exploring the myths that surround technology and its role in teaching and learning, higher education institutions can use commonsense ideas to survive in the online environment. http://www.educause.edu/ir/library/pdf/erm0222.pdf 

Bits and Atoms: An Interview with Neil Gershenfeld by RICHARD N. KATZ "Ordinary people can learn to do exceptional things if the educational attention moves from the content of a formal curriculum to the tools that can help people find their own solutions to problems that they care about." http://www.educause.edu/ir/library/pdf/erm0223.pdf 

EXCERPT

The Organizational Challenge: IT and Revolution in Higher Education by JOHN R. CURRY From Richard N. Katz and Associates, Web Portals and Higher Education: Technologies to Make IT Personal http://www.educause.edu/ir/library/pdf/erm0224.pdf 

DEPARTMENTS

techwatch Information Technology in the News http://www.educause.edu/ir/library/pdf/erm02211.pdf 

Leadership Commerce, Language, and Culture under One Roof by WILLIAM H. CROUCH JR. http://www.educause.edu/ir/library/pdf/erm02210.pdf 

E-Content Technology's Payload by DEANNA B. MARCUM http://www.educause.edu/ir/library/pdf/erm0229.pdf 

New Horizons Web Services: Stitching Together the Institutional Fabric by CARL JACOBSON http://www.educause.edu/ir/library/pdf/erm0228.pdf 

policy@edu What's Policy Got to Do with IT? by RODNEY J. PETERSEN http://www.educause.edu/ir/library/pdf/erm0227.pdf 

Viewpoints Vive la Difference? by GREGORY A. JACKSON http://www.educause.edu/ir/library/pdf/erm0226.pdf 

Homepage The Wise and Trusted Counselor by CYNTHIA GOLDEN http://www.educause.edu/ir/library/pdf/erm0225.pdf 

Increasingly popular among the PC-literate crowd, Internet-based training is helping hundreds, if not thousands, of accountants to balance their work schedules and their personal lives. http://www.accountingweb.com/item/74824 

Bob Jensen's threads on online training are at http://www.trinity.edu/rjensen/crossborder.htm 

Email Forwarding
SwitchEmail: Free Email Forwarding http://www.switchemail.com/pages/index.asp 

Email-To-FAX Service 
OURFAX: Free World Wide Email to Fax Service http://www.ourfax.com/ 

Telephone Voice to Email Service
Copytalk is a glorified dictation service. From any phone, you dial Copytalk's toll-free number. At the tone, you dictate, for example, an e-mail message. Between 3 and 20 minutes later, the message you dictated is sent on its merry way across the Internet (with or without your review, at your option), looking exactly as if it came from your desktop PC --- 
http://www.nytimes.com/2002/01/24/technology/circuits/24STAT.html 

Convert Print to Spoken Words
From Syllabus News on September 11, 2001

The recently released Scan and Read family of software scans any printed material and converts it to spoken words, delivered in a variety of voices through the computer's speaker. The software also displays the text on the screen and highlights each word as it's read, a helpful feature for readers of all ages, those with learning disabilities, and non-English speakers looking for a way to increase their vocabularies. The more advanced members of the software family include word processing capability; the ability to access Microsoft Word files and convert them to spoken words; automatic image rotation, which allows software to convert text regardless of how it's positioned on the scanner bed; and the ability to create MP3 files, which can then be downloaded to other devices.

For more information, visit http://www.premier-programming.com

Access Your PC from Anywhere - Free Download
GoToMyPC --- https://www.gotomypc.com/ 

FAQs --- https://www.gotomypc.com/help.tmpl?SessionInfo=9197287/5C369812E7DB446/null 

ZDnet gives it a rating of 9 out of 10 --- http://www.cnet.com/software/0-3227892-1204-8480755.html 

PC World Review --- http://www.pcworld.com/downloads/file_description/0,fid,8177,00.asp 

March 16 message from Richard Campbell [campbell@RIO.EDU] 

I thought some might want to see the new version of Flash in action. This puzzle is one of the sample files provided by Macromedia.

http://www.virtualpublishing.net/vp_puzzle/vp_puzzle.html 

Richard J. Campbell

March 16 message from Bob Blystone

I got up earlier that Bob Jensen so you get this email from me instead of the other Bob.

The Web site below is very interesting on several levels.

http://www.CampusTours.com/ 

The site allows one to see a photo album of 800 college campuses.

From time to time I have the opportunity of going to a campus that I have not visited before. This web site allows the chance to "see" the campus before going.

It also shows what some schools are doing to "show off" their institution.

The campus tours site also lists those schools that have web cams, campus maps, videos, and VR tours. Trinity was one of the first to have a VR tour.

Give it a quick look if you like to see what the other guys are doing and look like.

Bob Blystone

Robert V. Blystone, Ph.D. 
Professor of Biology 
Trinity University San Antonio, Texas 78212 
rblyston@trinity.edu  210-999-7243 FAX 210-999-7229

From Syllabus News on March 12, 2002

UC Davis Prof Launches Sustainable Business Web Site

A University of California at Davis professor launched a web site dedicated to "sustainable business," the idea that businesses make the social and environmental impact of their work a top priority. The Sustainable World site grew out an MBA course on responsible business and technology taught by Richard Dorf of the Graduate School of Mangement at U.C. Davis. Dorf sees the site as a way to bring together graduate students from several disciplines, including agriculture and engineering, and weave sustainable business thinking into engineering and business curricula.

For more information, visit: http://www.sustainablebiztech.org 

---

Online University Stocks Slip From All-Time Highs

Stocks of online universities fell last week on concerns that their earnings did not justify recent surges in share prices to all-time highs. Apollo Group, which administers educational programs for working adults, closed down 4.26 percent from an all-time high of $52 posted last Tuesday. Apollo subsidiary University of Phoenix Online, which offers degrees via the Internet, was down 6 percent, at $36.17, from an all- time high posted Tuesday. And ITT Educational Services, a provider of technical education, was down 2.49 percent, at $43.78. It has gained more than 26 percent since mid-January. "The entire post-secondary education group has been on a tear" over the past several weeks, said Greg Cappelli, senior research analyst at Credit Suisse First Boston. "It gets to a certain point and valuation becomes a concern."

---

From Syllabus News on March 19, 2002

William & Mary, AMS, Combine on Management Series

William & Mary College last week announced a partnership with American Management Systems Inc. to start a course in human capital management. The program, to focus on how organizational factors influence business success, will be funded by a $120,000 gift from AMS. A key part of the deal will be a seminar series in human capital management for business school faculty and AMS personnel. John Boschen, associate dean at the School of Business, said, "interactive relationships between business and schools of business are the wave of the future ... we gain support for further development of the management faculty and AMS can call on our depth of talent as consultants when projects require."

For more information, visit: http://www.business.wm.edu 

---

St. Edward's University to Enhance Online Offerings

Austin, Texas-based St. Edward's University said it would use web-based collaboration software to deliver MBA courses online and to expand its online undergraduate curriculum. The school will use software tools from Centra Inc. to deliver selected MBA programs completely online and improve the quality of online courses delivered through its New College undergraduate program for working adults. Centra applications, including interactive Web meetings, virtual classrooms, and large- scale conferences, are based on CentraOne, a thin-client Web platform that includes content creation tools and delivery systems that can either be installed on-site or accessed through its secure ASP.

For more information, visit: http://www.stedwards.edu 

---

Partnership to Globalize Blackboard 5 System

Blackboard Inc. last week announced a partnership to allow educational institutions abroad to tailor the Blackboard e-Learning platform to their local pedagogical approaches. The company said it would work with Welocalize Inc., a Frederick, Md., firm specializing in globalization services for the e- Learning industry, to help clients extend their e- Learning software and offerings across international borders. Georg J. Anker, a professor at the University of Innsbruck, said the international version of Blackboard "will surely further the systems acceptance on our own campus as well as throughout the German market. More importantly, it will enable us to establish the e-Campus in the region outside the traditional university and to offer one platform for a number of other learning institutions."

For more information, visit: http://www.blackboard.com 

---

U. Wisconsin's dot.edu Org Takes Sun Micro Award

Sun Microsystems, Inc. last week said it chose the University of Wisconsin's dot.edu department, at the Milwaukee campus, as a Sun Center of Excellence in e- learning. dot.edu -- Digital Online Technology.Educational Design Utility -- is an e- learning infrastructure provider for educational institutions inside and outside Wisconsin. As a Sun Center of Excellence in e-learning, dot.edu provides instructional design, software training, hosting services, and a 24x7 helpdesk for online course development. It has placed more than 10,000 courses online since the being founded in 1999. To date, there are two Sun Centers of Excellence in e-learning globally: dot.edu at the University of Wisconsin System and the University of Alberta, Canada.

For more information, visit: http://www.sun.com/edu 

Wow Site of the Week
University of Wisconsin's dot.edu:  10,000 courses online since the being founded in 1999
http://www.uwm.edu/Dept/dotedu/ 

dot.edu provides hosting services for online course development using an array of courseware products including, but not limited to, Prometheus and Blackboard. Services can be selected and uniquely organized to meet the needs of each associated institution. The Utility Model is structured as a three-stage implementation plan that transfers responsibility for course development and instruction from dot.edu to the associates. The program design and timeline are also determined by the needs of each institution. A written plan, with the flexibility necessary to meet changing needs, will be designed jointly by dot.edu and the respective institution.

Services we provide include:

• Hosting
• Course Management Systems
• Instructional Design Consultation
• Software Training
• The Solution Center - 7x24 Support
• ...and more! Click here to learn about them

dot.edu provides a robust, up-to-date e-learning system infrastructure including technology, training, support, and instructional design services to effectively apply these resources to enhance education. dot.edu works with all University of Wisconsin System higher education institutions, public and private higher education institutions, and public and private schools, school districts, and educational agencies in Wisconsin and beyond.

Reply from Damian Gadal  [DGADAL@CI.SANTA-BARBARA.CA.US] 

This site isn't too bad either:
http://online.sbcc.net/ 

March 19 message from Fathom

Fathom is bringing you a special break in online courses this spring. As a Fathom member, you'll save 25% off the listed enrollment fee when you enter the coupon code SPRNG at checkout for any Fathom enrollment through March 31. Hundreds of courses are now open for enrollment, including:

EDUCATION AND TECHNOLOGY

Microsoft Office for Teachers http://www.fathom.com/course/74705502/esp0 

Integrating Technology into the Math Curriculum http://www.fathom.com/course/12701060/esp0 

CLASSROOM MANAGEMENT

Differentiated Learners: Classroom Success Through Communication and Planning http://www.fathom.com/course/74705501/esp0 

Classroom Management and Conflict Resolution http://www.fathom.com/course/3202/esp0 

CURRICULUM & TEACHING

Teaching AP U.S. History: A How-To Course for Teachers http://www.fathom.com/course/3175/esp0 

Reading Strategies for K-2 Students http://www.fathom.com/course/3213/esp0 

COLLEGE COUNSELING

Special Issues in College Counseling http://www.fathom.com/course/59705316/esp0 

The College Admissions Process http://www.fathom.com/course/61705309/esp0 

See more courses: http://www.fathom.com/link.jhtml?cid=esp0&page=edu 

THINKING IS ENCOURAGED @ FATHOM.COM (TM) ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

* Offer expires March 31, 2002, and cannot be combined with any other offer. The 25% coupon may be used only once and will apply to the entire amount in your cart before checkout. This coupon is an exclusive offer from Fathom and is not valid on the websites of Fathom's individual course providers or any other website.

** 100% Satisfaction Guarantee: If for any reason you are not happy with your online course experience, you may request a full refund (price paid net of any applicable discounts or rebates) up to halfway through the course.

*** Questions? Email Fathom Customer Support at customer.support@fathom.com  Or call toll-free in the US and Canada: 1-877-731-6941

 

Free Assessment Summary Tool for Teachers --- http://www.getfast.ca/ 

Traditionally, teaching assessments are conducted at the end of a course - a practice precluding students from offering constructive feedback while they are still in the course. However, conducting instructor-designed and administered web-based course assessments opens a proactive dialogue with students about teaching, the course, and the entire learning process.

The FAST project is committed to providing users with a simple online tool for assessing their students' impressions of their courses and their teaching. Using the software does not cost anything so if this is your first visit, become a user and see if FAST would be useful for you and your students. Also, you may want to read the FAQ's and the User Tips to provide you with an overview of the functionality of the software.

If you have any questions or comments about FAST, please enter them in the discussion board or send either of us a note - Bruce Ravelli, lead researcher and/or Zvjezdan Patz, lead programmer.

Whose Rules?
Young people have grown up with computers, the Internet, and instant communication, yet are governed by the laws and values of a society still adjusting to such technological developments. (Not surprisingly, teens don't think adults have a clue.) InformationWeek examines the ethical issues being raised by, and about, your soon-to-be co-workers. http://update.informationweek.com/cgi-bin4/flo?y=eGNk0BcUEY04e0BZkg0AA 

FINANCE Investment Banking's Big Chill in Europe The Continent's investment bankers had a horrible year in 2001. This year could be worse 
http://europe.businessweek.com/magazine/content/02_12/b3775150.htm?c=bweuropemar19&n=link1&t=email 

Message received on March 20 from ProfNet [profnet@newprofnet.com] 

ProfNet - New Question

New question for Robert Eugene Jensen:

History of company declines

" Hi, I'm a reporter at the San Jose Mercury News, the main paper in Silicon Valley, and I'm researching historic parallels to the decline in the tech sector since 2000. In other words, what other industries have seen such a sharp reversal of fortune as the hi-tech industries have had during the tech bubble and bust? And what do these historic parallels show about what will happen next? One example is the bursting of the energy and oil service stocks after 1980.

I'm also looking for examples of companies that had very large write-offs of intangibles and impaired goodwill for expensive mergers in the past and what happened to them. If JDS Uniphase had the biggest write-off in U.S. Corporate history, what were the previous biggest write-offs... and what happened to these companies?

I can be reached at dsylvester@sjmercury.com or 408 920 5019... and I'm working on this this week but as soon as possible would help. Tnx David Sylvester Financial writer San Jose Mercury News

--Contact Details-- Organization: San Jose Mercury News Email: dsylvester@sjmercury.com Phone: 408-920-5019 "

from:

Temporary Access - Wed Mar 20 18:42:24 EST 2002

Access My ProfNet now --- http://www3.profnet.com/organik/orbital/login/login.jsp?bypassSessionCheck=true 

The 101 Dumbest Moments in Business --- http://www.business2.com/dumbest/ 

In a perfect world, a list like this would not exist. In a perfect world, businesses would be run with the utmost integrity and competence. But ours is, alas, an imperfect world, and if we must live in one where Enron, Geraldo Rivera, and Cottonelle Fresh Rollwipes exist, the least we can do is catalog the absurdities. 
By Tim Carvell, Adam Horowitz, Thomas Mucha, April 2002 Issue

1. Houston, We Have a Problem, Part 1: Enron states billions of dollars in extra revenue through aggressive accounting and complicated off-the-books partnerships managed by its own executives, all the while ignoring warnings from its employees and enriching its top executives at the expense of its investors and workforce. And it assumes none of this will ever come to light. 

2. A dozen Burger King marketing execs suffer first- and second-degree burns while walking over hot coals as part of a team-building retreat in October. One of the injured, a VP for product marketing aptly named Dana Frydman, tries to put a positive spin on having her feet flame-broiled like so much ground chuck. "It made you feel a sense of empowerment and that you can accomplish anything," she tells the Miami Herald.

3. Republic co-founders Mel and Patricia Ziegler start ZoZa, an "athletic formalwear" retailer, in late 2000. Mel says he expects sales to reach $1 billion within seven years. Gary Rieschel of Softbank Venture Capital invests $16.5 million, telling BusinessWeek, "If you have guts and you have capital, how can you not be optimistic about the consumer market?" Here's how: ZoZa's designers revamp its spring 2001 line, intentionally making their dresses two sizes smaller than labeled. Even the svelte are outraged, and ZoZa's merchandise return rate soars to 80 percent. The company shuts down in May 2001, proving that, if the dress doesn't fit, you must, uh, quit.

4. Sept. 11 Inc., Rampant Greed Division: Gas stations nationwide exploit post-Sept. 11 fears of a fuel shortage by charging customers $4 and $5 per gallon. Among the worst offenders: a station in Jackson, Mich., that, according to Newsweek, hikes its price to $6.75 per gallon.

5. Proving the old business-school saw that "any idiot can sell a dollar for 80 cents," online-currency company Flooz.com in July launches a special offer whereby American Express platinum cardholders can buy $1,000 of Flooz currency for just $800.

6. A month later, Flooz.com ceases processing transactions. It declares bankruptcy in November, leaving those who bought Flooz currency stuck with worthless e-dollars.

7. Last May, Citizens Against Government Waste, a group that received funding from Microsoft (MSFT), is caught simulating a "grassroots" campaign to get state attorneys general to drop their antitrust suit against the software giant. One detail that gives the scheme away: Some of the letters supporting Microsoft are from people who have long since died.

8. After issuing his landmark antitrust decision against Microsoft, Judge Thomas Penfield Jackson lets reporters print comments from previously confidential interviews, in which he compares Bill Gates to Napoleon and Microsoft executives to gangland killers. In June an appeals court overturns Jackson's decision to break up the company, citing his remarks as evidence of his "rampant disregard for the judiciary's ethical obligations."

9. At a Microsoft employee event last summer, CEO Steve Ballmer apparently suffers a grand mal seizure. Or attempts to dance. One or the other. It's hard to tell. In any case, a video clip of his calisthenics starts making the rounds of the Internet.

10. With the slogan "Sometimes wetter is better," Kimberly-Clark (KMB) introduces Cottonelle Fresh Rollwipes premoistened toilet paper -- or, to put it another way, baby wipes for adults.

24. By faking the transactions that should have offset the risk in his portfolio, a trader named John Rusnak, working for a Baltimore subsidiary of Allied Irish Banks, loses $691.2 million before the bank discovers his misdeeds. After the bank and the federal government launch investigations, Rusnak is fired, denying him the chance to unseat Barings PLC's Nicholas Leeson -- who lost $1.4 billion and destroyed a 232-year-old company -- as the most inept rogue trader ever.  

Bob Jensen's threads on derivative financial instruments frauds are at  http://www.trinity.edu/rjensen/fraud.htm#DerivativesFraud 

Nice going Lehman
55. Houston, We Have a Problem, Part 7: Richard Gross, an analyst at Lehman Bros., maintains a "strong buy" rating on Enron as the stock declines from $81 to $0.75. A Lehman spokesperson helpfully explains to the New York Times that the firm was advising Dynegy on its purchase of Enron's pipeline, and it is Lehman's policy not to change the firm's rating on any company involved in a deal in which Lehman is an adviser.

100. Houston, We Have a Problem, Part 14: In February 2002, as it struggles to emerge from bankruptcy, Enron pays more than $200,000 to retain its box seats and luxury suite at Enron Field. The company argues that it is making the payment solely to fulfill its contractual obligation -- although, coincidentally, it had earlier failed to fulfill a $200,000-a-year commitment to fund a local Boys and Girls Club.

63. Bottling the Stench of Death and Calling It Perfume: Philip Morris also attempts to counter antismoking measures in the Czech Republic by commissioning an economic analysis of the "indirect positive effects" of early deaths -- savings on health care, pensions, welfare, and housing for the elderly. The company later apologizes.

75. Unilever subsidiary Lipton approves an ad in which a man standing in line for communion holds a bowl of onion dip, presumably to improve the taste of the body of Christ. Under protest, Lipton withdraws the ad.

98. "Do you judge Ted Williams on one bad year?" -- Morgan Stanley analyst Mary Meeker, to Fortune magazine, explaining why it's unfair to criticize the fact that stocks on which she has maintained "outperform" ratings have lost more than 90 percent of their value. (For the record, Ted Williams's worst year was 1959. He played the season with a neck injury and still finished the year hitting a respectable .254.)

Continued at http://www.business2.com/articles/mag/0,1640,38604,00.html 

In a reply message, David Albrecht noted that Number 40 is really funny.

40. The Newspaper Association of America names Kmart its "Retailer of the Year" on Jan. 21, 2002, one day before the company files for bankruptcy protection under Chapter 11.

Reply from Leo Gallant [lgallant@STFX.CA] 

This could become a whole new language of laughter for accountants. 
47 Ha Ha 
83 Ha Ha
and so on

Reply from NANCY BAGRANOFF [BAGRANNA@MUOHIO.EDU] 

I'd just like to chime in to say that Business 2.0 is one of the greatest resources for all kinds of stories. The dumbest moment story is second only to the business guru trading cards in the October 2001 issue. I subscribe to the paper journal but most everything is at the web site - www.business20.com .

Nancy A. Bagranoff 
Professor of Accountancy 
RT Farmer School of Business Admin. 
Miami University Oxford, Ohio 45056

March 14, 2002 message from Dennis Beresford [dberesfo@terry.uga.edu] 

Bob,

The Financial Accounting Foundation proposed today to reduce the size of the FASB from 7 to 5 members in order to speed up the process. The press release describing this is on the Board's web site - www.fasb.org .

Denny

The news release is at http://www.fasb.org/news/nr031402.html

After a review of recent events, the Trustees determined that there is a need for the FASB to be more flexible in responding to change and to increase the efficiency of its standard-setting process. By doing so, financial reporting standards would be enhanced.

The Trustees considered the need for accelerating the standard-setting process by improving the FASB’s efficiency without compromising the quality of its open due process. To meet that objective, the Trustees approved a proposal for public comment that includes the following:

• Reduction in the size of the FASB from seven to five members.
  
• A simple majority-voting requirement of 3-2 for the five-member board. The current board has a 5-2 supermajority requirement.
  
• A recommendation to the FASB that it expose proposed standards for shorter comment periods.

The Trustees will carefully consider responses to the proposal before deciding on a course of action. If approved, the proposed reduction in the size of the FASB would transition over time and be achieved through attrition. Comments also will be sought on the composition of a five-member board. The current board is composed of three members from public accounting, two from industry or the preparer community, another from the investor or user community and one from the academic community.

In reflecting on the action under consideration by the FAF to enhance the FASB’s process, Mr. Johnson remarked, "We have a responsibility to investors and we take it very seriously. The Trustees are committed to preserving the independence of private-sector standard setting and will continue to consider improvements to the process in as timely a manner as possible."

Independence

At its March 4 meeting, the Trustees also reviewed the importance of having an independent accounting standard setter. Much of that review centered on a position paper entitled "The FASB’s Role in Serving the Public, A Response to the Enron Collapse" that was prepared by FASB Chairman Edmund L. Jenkins. The paper, covering a broad range of issues, emphasizes the necessity of having an independent, private-sector accounting standard setter in maintaining efficient capital markets and is available on the FASB’s website at www.fasb.org .

Despite significant resistance from some of those affected, the FASB has made substantial improvements to financial reporting that have resulted in greater transparency of financial information. The following are a few examples drawn from the Jenkins paper:

Requiring that reporting entities recognize liabilities for retirement benefits when those entities promise them to employees rather than when they later pay them.

• Requiring significant disclosures about the separate operating segments of an entity’s business so that investors can evaluate the differing risks in the diverse operations.
  
• Requiring that derivative instruments and hedging transactions be reflected in financial statements which, previously, were not reflected.
  
• Requiring that the acquisition of one company by another be accounted for in the same way for all entities and that the total amount paid for the acquisition be reflected in the financial statements. In the past, that was not often the case.

In commenting on current auditor reform proposals, Mr. Johnson stated, "While the Trustees are interested, concerned and highly supportive of efforts to improve the independence and effectiveness of the auditing system, the FASB has no authority or responsibility for auditing matters. And as part of the broader financial reporting system, we believe it is critical that the FASB remain an independent, private-sector organization—free from political pressure. Independence is critical to developing credible and transparent information for investors and is essential to the vibrancy of the U.S. capital markets."

Vital to the independence of a private-sector standard setter is broad-based funding support from constituents in order to avoid undue influence from any single source. In commenting on this issue, Mr. Johnson said, "Now more than ever, all of our constituents—and especially the investor community—should view this as an important opportunity to support high-quality financial reporting standards, and we strongly encourage broad participation in the contribution process." Approximately two-thirds of the FASB’s funding comes from the sale of publications and licensing agreements. The remaining one-third is from a broad base of contributors, including the public accounting profession, and the corporate, investor and academic communities.

Comment Period

A document seeking public comments on the proposed changes will be issued on or about March 18, 2002, and will also be available on the FASB’s website at www.fasb.org . The comment period will be 30 days and all responses received in that time frame will be considered by the Trustees at their next regular meeting scheduled for April 23, 2002.

This is an age-old question of the accounting world, and there are no easy answers. In simpler times, the fear of being publicly humiliated by losing your CPA license and having to sit for the 3-day exam again was enough to keep most CPAs clean. http://www.accountingweb.com/item/74689 

No longer the impossible dream, international accounting standards just took another step closer to gaining widespread acceptance. On March 12 the European Parliament voted in favor of plans to require IAS for listed companies in the European Union, starting in the year 2005. http://www.accountingweb.com/item/74948 

Diversity Poll Identifies Top-Ranked Accounting Firms
A survey by The Black Collegian magazine of more than 2,300 African, Asian, Hispanic, and Native American undergraduate and MBA students found that corporate diversity is a critical factor for minority students in deciding upon employers, and several major accounting firms are among the companies that excel in this area. http://www.accountingweb.com/item/73983 

UK's Sunday Times Chronicle of the Future (including prediction of a new set of Ten Commandments in 2042)
http://www.chronicle-future.co.uk/ 

From Phil Livingston, CEO of the Financial Executives International on March 20, 2002

FEI Publishes Reform Recommendations Last week the FEI Executive Committee approved a set of recommendations for consideration by Congress, the regulators and all corporate executives. The proposals cover a broad area and are intended to strengthen our financial reporting and governance systems. The 12 recommendations were developed by a member task force, and the task force also had significant input from FEI’s Committee on Corporate Reporting.

We offer recommendations in four areas: · Strengthening financial management and commitment to ethical conduct · Rebuilding confidence in financial reporting, the accounting industry and the effectiveness of the audit process · Modernizing financial reporting, and reforming the accounting standards-setting process · Improving corporate governance and the effectiveness of audit committees

Download a copy of the recommendations at: http://www.fei.org/download/taskforce.pdf  (This file is in Adobe Acrobat format. To download the free Adobe Acrobat reader, click here: http://www.adobe.com/products/acrobat/readstep2.html  )

FEI Publishes Revised Code of Ethics After receiving more than 200 comments from members, FEI is republishing its Code of Ethics. Thanks to the great work by the Ethics & Eligibility Committee, chaired by Rich Schrader, CFO of Parsons Brinckerhoff. The revised code now calls for all financial executives to acknowledge their affirmative duty to proactively promote ethical conduct in their organizations. View the revised code at: http://www.fei.org/info/code.cfm 

March 20 Message from Ira Kawaller

Hi Bob,

I just posted a recently published article on how to satisfy the FAS 133 disclosure requirements for interest rate hedges.  Although it was originally published by Bank Asset/Liablility Management (March 2000), the content is 
applicable to all firms with interest rate exposures -- not just banks.  

If you are interested, it is available at 
http://www.kawaller.com/pdf/BALMHedges.pdf 

You can also find additional information about derivatives, risk management, and FAS 133 in the various articles posted on the Kawaller & Company website:  
http://www.kawaller.com 

Please feel free to contact me with any questions, comments, or suggestions.

Ira Kawaller
Kawaller & Company, LLC
kawaller@kawaller.com 
(718) 694-6270

Bob Jensen's documents and threads on FAS 133 are linked at http://www.trinity.edu/rjensen/caseans/000index.htm 

The Excel workbook solutions to examples and cases are on a different server at http://www.cs.trinity.edu/~rjensen/ 

News of the Week

XBRL Statements Make Their Internet Debut
Microsoft Corporation has announced that it is the first technology company to publish its financial statements on the Internet using Extensible Business Reporting Language (XBRL). http://www.accountingweb.com/item/74412 

Bob Jensen's XBRL threads are at http://www.trinity.edu/rjensen/xmlrdf.htm 

The shortage of experienced personnel in the accounting profession has become critical. According to most estimates, this will not change in the near future. Every firm is looking for a magical way to keep staff happy, motivated and out of the job market. http://www.accountingweb.com/item/74223 

The Case for Halting the Auditors' Revolving Door
Law-makers and businesses are taking steps to halt the "revolving door" between auditors and their clients. A majority, 58%, favor imposing a two- to five-year waiting period during which auditors may not accept senior positions with audit clients. http://www.accountingweb.com/item/73865 

Differences of opinion between House Democrats and Republicans have resulted in the introduction of a second bill in the House Financial Services Committee. Known as the Comprehensive Investor Protection Act, this new proposal is the toughest accounting reform bill yet. It was the result of close coordination with the Securities and Exchange Commission, and it is supported by the AFL-CIO, consumer groups, and former SEC Chief Accountant Lynn Turner. http://www.accountingweb.com/item/73861 

Differences of opinion between House Democrats and Republicans have resulted in the introduction of a second bill in the House Financial Services Committee. Known as the Comprehensive Investor Protection Act (CIPA), this new proposal is the toughest accounting reform bill yet. It was the result of close coordination with the Securities and Exchange Commission (SEC), and it is supported by the AFL-CIO, consumer groups, and former SEC Chief Accountant Lynn Turner.

Among other things, CIPA would:

• Create a Public Accountability Board with a 7-member majority selected from the public and the remaining 6 members drawn from groups representing institutional investors and pension funds.
  
• Empower the Board to conduct reviews of audits and audit firms, institute disciplinary actions and set standards for quality control of audits, auditor independence, and ethics.
  
• Impose tougher legal penalties on auditors by restoring joint and several liability in certain circumstances and restoring the aiding and abetting liability for accountants and outside professionals.
  
• Require the SEC to review more filings more systematically based on a risk-rating system that uses analytics (such as price-earnings ratios) to determine the frequency of reviews.
  
• Restrict auditors from providing a list of specified nonaudit services and require audit committee approval of any nonaudit services not listed in the bill, such as tax services.
  
• Require a 4-year rotation of auditors, with the possibility of one 4-year extension, if approved by the Public Accounting Regulatory Board.
  
• Require audit committees to meet quarterly with auditors and have an opportunity to do so outside the presence of management.
  
• Require a 2-year cooling off period for certain former auditor employees before they could work for an audit client.
  
• Prohibit directors from providing consulting services to the companies on whose boards they sit.
  
• Double the resources for SEC’s Division of Enforcement, Corporation Finance, and Office of the Chief Accountant.
  
• Set restrictions on security analysts to prevent conflicts of interest.

In introducing the bill, Representative John LaFalce said, the reforms are not "cosmetic" and do not "paper over the problem." Georgetown University law professor Donald Langevoort told Reuters, "If it were just the little guy who got trounced [by the Enron collapse], we would simply get cosmetic changes. But this has hurt more than the little guy."

Read the news release. Read the summary of the bill. View a side-by-side comparison with the bill introduced by the House Financial Services Committee Republicans.

The American Institute of CPAs is building a lobbying campaign against Enron-related reform proposals being discussed in Washington and demanded by the private sector. According to an AICPA spokesman, an e-mail was distributed to 3,000 federal key people - AICPA members who have contact and/or access to lawmakers - urging their assistance in convincing lawmakers to temper the response to requests for reforms. http://www.accountingweb.com/item/74169

Also see http://www.house.gov/banking_democrats/pr_020228.htm 

Bob Jensen's threads on fraud are at http://www.trinity.edu/rjensen/fraud.htm 

A message from Barry Rice

Today's issue of The Baltimore Sun has an article which tries to put a positive spin on being an accountant. I'm not sure they succeed! It's at http://www.sunspot.net/features/lifestyle/bal-to.accountant06mar06.story?coll=bal%2Dartslife%2Dtoday  . The title is "The numbers game -There's no accounting for taste as changing times and high-profile scandals turn bean counters from no-accounts to celebrities". I find it interesting that in the paper edition, the article appears in the Today section rather than the Business section. That is the section with the TV listings, movie reviews, the comics and Ann Landers and Liz Smith's columns.

Please note that after two weeks, The Sun archives articles and after that they are only available for a fee.

Barry Rice 
www.barryrice.com  
www.AccountingIsCool.com 

LEARNING TO PUT ETHICS LAST 

During their spell in B-school, MBA students become more focused on company profitability and less on things like customer service

Does an MBA degree change a person's attitudes and values? According to a new study, the answer is yes -- and perhaps not for the better. "Where Will they Lead?: MBA Student Attitudes About Business & Society," published by the nonprofit Aspen Institute's Initiative for Social Innovation through Business (ISIB), finds that MBA students enter B-school with relatively idealistic ambitions, such as to create quality products and be of service to consumers. By the time they graduate, though, these goals have taken a back seat to such priorities as boosting their company's share price.

It might appear a benign transformation were it not for the specter of Enron, where MBAs Jeffrey Skilling (Harvard 1979) and Andrew Fastow (Northwestern 1987) apparently pursued such a strategy to the hilt, with disastrous results.

FOR THE FULL VERSION, VISIT: http://www.businessweek.com/bschools/content/mar2002/bs2002038_0311.htm?c=bwmbamar13&n=link1&t=email 

Ten Ways to Reduce Chargebacks and Fraud Merchants' concern about online credit card fraud and chargebacks is rising at a significant rate. According to the 2001 Online Fraud Report conducted by Mindwave Research, 41 percent of merchants say the issue of online credit card fraud is "very serious" to their business. http://www.newmedia.com/default.asp?articleID=3443 

Bob Jensen's threads on fraud are at http://www.trinity.edu/rjensen/fraud.htm 

Bob Jensen's e-Commerce threads are at http://www.trinity.edu/rjensen/ecommerce.htm 

GMAT PREP Looking to improve your score? To help you prepare as thoroughly as possible, BusinessWeek Online has developed an area that focuses on the ins and outs of the exam. You'll find expert advice, sample questions, and more http://www.businessweek.com/bschools/gmat/?c=bwmbamar13&n=link6&t=email 

Hi Dave,

Her name is Amy Dunbar at the University of Connecticut.

I think all educators should read at least the first 15 pages of "Genesis of an Online Course," by Amy Dunbar at www.sba.uconn.edu/users/adunbar/genesis_of_an_online_course.pdf 

She was the Wow Professor of the Week at http://www.trinity.edu/rjensen/book01q3.htm#Dunbar 

Her husband also teaches tax online, although he also has some onsite courses at the University of Connecticut.

Hopefully, Amy will be presenting a workshop on August 13 in San Antonio. Watch for a future announcement under CPE at http://accounting.rutgers.edu/raw/aaa/2002annual/meetinginfo.htm 

Bob Jensen

-----Original Message----- 
From: University of St Thomas [mailto:djohn@USWEST.NET]  
Sent: Thursday, March 07, 2002 12:32 PM To: AECM@LISTSERV.LOYOLA.EDU 
Subject: Secrets of online teaching success

I'm looking for a link from Bob Jensen's site and can't find it. It linked to an online tax accounting course that was exemplary. I recall that it was taught by a woman (and husband team?) and that she routinely received the highest marks from her course evaluations, even from students who received poor grades. Does anybody remember this link? I want to discover the secrets to her success delivering an online course. 
Dave Johnson

Reply from Barb Edwards [bjedwards@SHAW.CA] 

I think all educators should read at least the first 15 pages of "Genesis of an Online Course," by Amy Dunbar at www.sba.uconn.edu/users/adunbar/genesis_of_an_online_course.pdf 

I found this interesting to read. First I noted that teams were used and that the students' responses were very positive. (Exhibit III, page 19) I use teams in my online accounting course and I now have a case that deals with team building to prepare the graduate students for team work. I am interested in comments from others about using teams in online courses and the need for team building. My teams complete weekly case summaries and once a term a major presentation of one case.

The other point that was interesting is that students generally did not use the "flashier" tools - flash files, sound files (Exhibit II, page 17). I was considering adding audio but now I wonder if it is worth the work. Maybe the straight content is more important than flash. Opinions?

The last point that I still struggle with is having students accept that graduate courses are different from undergrad. Just like Dunbar's course, my course is the first graduate course. How do you really prepare them for the graduate level of work? Thanks

Barb Edwards 
Senior Lecturer, 
Accounting Graduate Diploma in Business Administration 
Simon Fraser University, 
Burnaby BC Canada Email: bjedwards@sfu.ca 

From Syllabus News on March 5, 2002

Distance Learning Lobby Praises Internet Bill

A distance learning lobbying group said it supported the House's passage of H.R. 1542, the Internet Freedom and Deployment Act. U.S. Distance Learning Association executive director John Flores said passage of the bill is "good news for the nation's distance learning industry whose future prosperity depends on universal access to broadband technology in our nation's homes, schools, universities and workplaces." The bill, sponsored by Reps. Billy Tauzin (R-La.) and John Dingell (D-Mi.), requires Bell companies' central offices to have high speed data capabilities within five years.

For more information, visit: http://www.usdla.org 

---

George Washington U. Launches Consulting Group

George Washington University launched a consulting group to provide learning strategies for business and government clients. GWSolutions will "pinpoint key challenges and craft individualized and customized learning strategies" for its customers. Solutions will range from top-to-bottom learning programs in multimedia formats, to trends analysis, strategic consulting, research, and the development of joint ventures. In launching the venture, the school said its first "Solution Center," would focus on problems related to security, including crisis, emergency and risk management; privacy, information security, and transportation safety.

For more information, visit: http://www.gwu.edu 

---

Scottish School Offers Advanced Degree in Games Tech

The University of Abertay Dundee is offering what it claims is the world's first postgraduate degree in computer games technology. It will recruit its first group of students via the British Council's Online Learning Zone (OLZ) in New Dehli. The school expects about 20 young Indian computer scientists will subscribe and participate in the course via the WebCT online learning platform. The OLZ in Delhi is a mini-campus, equipped with library and hi-tech computers. Indian students taking the Abertay course will have the same quality learning experience as students in Dundee, with the only difference being that the lecturer is on the screen instead of the podium.

For more information, visit: http://www.abertay.ac.uk 

AICPA Issues Proposed Standard On Fraud Detection
On February 28, 2002, the American Institute of CPAs (AICPA) released a draft of a revised audit standard on Consideration of Fraud in a Financial Statement Audit. If adopted, this updated standard will replace the current standard with the same name, (Statement on Auditing Standards No. 82). http://www.accountingweb.com/item/73718 

From The Wall Street Journal Accounting Educators' Review on March 7, 2002

TITLE: Auditing Standard for Detecting Fraud Is Posed
REPORTER: Dow Jones Newswires
DATE: Mar 01, 200
PAGE: A4
LINK: http://online.wsj.com/article/0,,BT_CO_20020228_009080.djm,00.html
TOPICS: Auditing

SUMMARY: The article implies that a new auditing standard on fraud actually has been issued, but the actual document issued was an exposure draft of a proposed standard.

QUESTIONS:

1.) Access the AICPA web site to read the actual document issued by the Auditing Standards Board at http://www.aicpa.org/members/div/auditstd/consideration_of_fraud.htm 

The article begins with the statement that "the Auditing Standards Board (ASB) of the American Institute of Certified Public Accountants issued expanded fraud guidance for U.S. auditors..."  Is this statement correct?

2.) In the second paragraph of the article, the author states, "The guidance comes at a time when questionable accounting practices have surfaced in the wake of bankruptcy-law filings by...Enron Corp. and Global Crossing Ltd."  Were these recent scandals the reason behind the new auditing standard proposal?  If not, what were the ASB's reasons for proposing the new standard?  (Hint:  again see the actual document at the AICPA's web site.)

3.) The proposed new standard would mandate specific requirements to search for fictitious entries and perform other tests to search for fraud under certain circumstances.  Compare and contrast this proposal to current auditing requirements to search for fraud.

SMALL GROUP ASSIGNMENT: The proposed auditing standard requests feedback from respondents to assess each of the major areas of the new standard  (e.g., classification of risk factors for fraud, identification of revenue recognition as the major area for risk of fraud, consideration of the risk of management override of fraud, inquiry of audit committees about fraud, and the attitude of professional skepticism).  Divide the class into small groups and assign one section to each group to draft a response to the questions posed in the exposure draft.

Reviewed By: Judy Beckman, University of Rhode Island
Reviewed By: Benson Wier, Virginia Commonwealth University
Reviewed By: Kimberly Dunn, Florida Atlantic University

Bob Jensen's threads on fraud are at http://www.trinity.edu/rjensen/fraud.htm 

THE E-MAIL MONSTER This indispensable tool for business has a huge dark side that can bring mail servers -- and workers' productivity -- to a halt --- http://www.businessweek.com/technology/tc_special/email.htm?c=bwtechmar08&n=link8&t=email 

Museum of Hoaxes (repeated from earlier editions of New Bookmarks)  --- http://www.museumofhoaxes.com 

March 8, 2002 message from Craig Polhemus [craig@aaahq.org] 

FEI BUSINESS COMBINATIONS VIDEO PROGRAM http://www.fei.org/confsem/bizcombo2k2/agenda.cfm

American Accounting Association (AAA) members may view a replay of a day-long webcast on accounting for business combinations and intangible valuations (SFAS 141 and 142) at half the price that will be charged to other non-FEI members ($149 versus $299). The FEI hopes to use funds generated from AAA members to help the FEI assume sponsorship of a Corporate Accounting Policy Seminar.

The webcast encompassed five presentations by experts with question-and-answer periods: (1) Overview of SFAS 141/142, by G. Michael Crooch, FASB Board Member; (2) Recognition and Measurement of Intangibles, by Tony Aarron of E&Y Valuation Services and Steve Gerard of Standard and Poors's, (3) Impact on Doing Deals: Structure, Pricing and Process, by Raymond Beier of PWC and Elmer Huh, Morgan Stanley Dean Witter, (4) Testing for Goodwill Impairment, by Mitch Danaher of GE, and (5) Transition Issues and Financial Statement Disclosures, by Julie A. Erhardt of Arthur Andersen's Professional Standards Group.

As an example (Digital Island Inc.) of the impact of FAS 142 on impairment testing for goodwill, please print the following document: http://www.edgar-online.com/brand/businessweek/glimpse/glimpse.pl?symbol=ISLD

Amortization of intangible assets. Amortization expense increased to $153.7 million for the nine months ended June 30, 2001 from $106.4 million for the nine months ended June 30, 2000. This increase was primarily due to a full period of amortization of the goodwill and intangibles related to the acquisitions of Sandpiper, Live On Line and SoftAware, which were completed in December 1999, January 2000 and September 2000, respectively. This increase was offset by a decrease in the current quarter's amortization as a direct result of a $1.0 billion impairment charge on goodwill and intangible assets in the quarter ended March 31, 2001. Amortization of intangible assets is expected to decrease in future periods due to this impairment charge.

Impairment of Goodwill and Intangible Assets. Impairment of goodwill and intangible assets was recorded in the amount of $1,039.2 million. The impairment charge was based on management performing an impairment assessment of the goodwill and identifiable intangible assets recorded upon the acquisitions of Sandpiper, Live On Line and SoftAware, which were completed during the year ended September 30, 2000. The assessment was performed primarily due to the significant decline in stock price since the date the shares issued in each acquisition were valued. As a result of this review, management recorded the impairment charge to reduce goodwill and acquisition-related intangible assets. The charge was determined as the excess of the carrying value of the assets over the related estimated discounted cash flows.

March 8, 2002 Message from the Risk Waters Group [RiskWaters@lb.bcentral.com] 

ONLINE TRADING TRAINING NOW AVAILABLE (Investments, Finance, Derivatives) … 
‘Introduction to Trading Room Technology’ from Waters Training. A low-cost, Web-based training solution for financial professionals. Go at your own pace, travel nowhere, and learn about the core trading processes and key technology issues from your own desktop. For more information, go to http://www.waters-training.com  to find out more. Lastly, if you have any colleagues, training managers or business associates who would be interested in this new product, please forward them this message. 
Thank you.

GIS and Historical Maps from the David Rumsey Collection (Geography, History, Travel) http://www.davidrumsey.com/ 

Terrorism: Questions & Answers --- http://www.terrorismanswers.com/ 

An e-publisher selling versions of several significant books survives a day in court against Random House --- http://www.wired.com/news/politics/0,1283,51022,00.html

Bob Jensen's threads on electronic books are at http://www.trinity.edu/rjensen/ebooks.htm 

From InformationWeek Daily on March 4, 2002

Adobe's All Aboard Web Services

Web, print, and video publishing vendor Adobe Systems Inc. is getting into the Web services game with an update to its AlterCast imaging server software.

AlterCast automatically creates multiple versions of an image based on one original version, so they can be easily modified to use across Web sites in various formats (in different sizes, colors, and so on). The new version will further simplify the process by letting AlterCast communicate with content-management systems and application servers via the Simple Object Access Protocol Web-service standard. "One of the key advantages of Web servers is being able to create Soap packets on any system that can talk to AlterCast servers, whether the server runs on Solaris or Windows," says Gregg Brown, group product manager for Adobe AlterCast servers. Customers who previously had to buy multiple versions of AlterCast, depending on the import and export formats they needed to support, now only have to buy one copy of the software.

E-business integrator Burntsand Inc. uses AlterCast to help its clients access advertising images, and channel director Christian Pease is looking forward to the upgrade. "With Web services, we can take ad content that we've already created and make it available to a broader set of players in a supply chain or business-to-business environment, without having to do extra coding," he says.

The AlterCast Web-services upgrade will be available free to existing users Monday on Adobe's Web site  http://update.informationweek.com/cgi-bin4/flo?y=eGHt0BcUEY0V20BXKx0Ad . The product is priced at $7,500 per CPU for new users. 

---

Business-Intelligence Progress In Jeopardy

E-business technologies, CRM applications, supply-chain management systems, and other enterprise applications can provide competitive advantages or bring companies closer to customers and suppliers. But many companies are having difficulty organizing the data and disseminating it to decision makers. Can business- intelligence tools really help? According to a Datamonitor report, business-intelligence tools will help many businesses, but others will find serious barriers. http://update.informationweek.com/cgi-bin4/flo?y=eGHs0BcUEY04e0BXLB0A1 

A Statement of Responsibilities for AAA Members? Register Your Views

The American Accounting Association Council is considering the adoption of a Statement of Responsibilities (SOR) as guidance for Association members. The AAA Professionalism and Ethics Committee wrote a proposed Statement of Responsibilities after many years of input from AAA members. Previous versions have been exposed at both regional and national AAA meetings.

The current version of the proposed SOR, a set of Frequently Asked Questions, and two questions are online at http://www.aaahq.org/surveys/sor.cfm  so that you may register your views and provide confidential feedback by March 31. The Professionalism and Ethics Committee will present the results of this member feedback to the Council at its meeting in Sarasota, Florida, on April 6. Please participate and express your views.

AAA Professionalism and Ethics Committee

Medicine and Madison Avenue (Marketing and Advertising History) 
http://scriptorium.lib.duke.edu/mma/ 

Bob Jensen's marketing helpers are at http://www.trinity.edu/rjensen/bookbob1.htm#022119Advertising%20and%20Marketing 

Harry Benson: 50 Years in Pictures (History, Photography) --- http://digitaljournalist.org/issue0112/hb_intro.htm 

The Wright Brothers in Photographs (Aviation, History)  http://www.libraries.wright.edu/special/wright_brothers/dmc.html 

The Whitney Museum of Art: 2002 Biennial Exhibition http://www.whitney.org/2002biennial/ 

In an ambitious project, the Library of Congress is digitizing its perfect rendition of the Gutenberg Bible. These high-resolution images could reveal more about Gutenberg's invention of moveable type --- http://www.wired.com/news/culture/0,1284,50589,00.html 

"Handhelds of Tomorrow," Technology Review, April 2002 --- http://www.techreview.com/articles/tristram0402.asp 

Encouraged by such statistics, some companies are offering next-generation devices that give consumers either new ways to do old things or new functions we didn’t know we needed. At last November’s Comdex, the world’s biggest trade show for consumer electronics, Bill Gates spent much of his keynote speech predicting the coming popularity of tablet-style wireless computers, which will supposedly replace today’s keyboards with pen-based computing. National Semiconductor was pushing for its all-in-one Geode Origami Mobile Communicator, a prototype that folds up into different shapes depending on its use, transforming itself into a digital camera, a digital video recorder, a videoconferencing terminal, an Internet access device, an Internet picture frame, an MP3 player and a few other things to boot. A company called Senseboard Technologies showed off its virtual keyboard, which lets you type in the air by measuring the movements of your fingers and converting them to readable e-mail messages. Then there was the Chat Pen from Ericsson, which records your handwriting on digital paper, transmits this digitized scrawl to your cell phone, and sends it along to any e-mail address. There are countless others, in prototype and production.

Most of these concepts, of course, will tank. Not because they don’t offer enough processing power or storage capacity. Not because they don’t offer compatibility with the latest wireless protocol. Not because they don’t do what they’re supposed to do, although that can be an issue. Unh-uh. The ultimate success or failure of any given gizmo will depend on a million or so people picking it up and deciding whether it feels good or not.

“Most good products are designed around the person, not the technology,” says Donald A. Norman, principal at Fremont, CA-based Nielsen Norman Group and author of The Invisible Computer, a manifesto for replacing “technology-centered” products with “human-centered” ones. “It’s not a case of people saying, ‘Gee, look at this neat technology.’ It’s a case of people saying, ‘Gee, look at what this thing can do for me.’”

A message from David Fordham on March 7, 2002

We have had superb results using The Accounting Library, by Excelco. It is easy to learn, astoundingly comprehensive, intuitive, and very complete in its line-up of accounting packages.

We give the students a case study (in most semesters, a contrived and well-developed hypothetical company replete with all sorts of "easter-eggs" in the internal-control area, -- but occasionally a real live consulting engagement). The students then use The Accounting Library to select a fitting package, and justify why they select their package over the others compared by TAL.

The CEO of Excelco is a close friend of Ralph Benke, one of our emeritii faculty, and they keep us updated with the latest edition. I don't know if they have an educational version or not, but it is certainly worth checking out. Their product is one of the most comprehensive that I've run across, at least for small to medium-large companies. They won't handle a Boeing or General Motors, but would easily handle a Weyerhauser or Starbucks or Starlight Plastics, all the way down to a one-chair barbershop.

See http://www.excelco.com 

David Fordham 
James Madison University

From: 
Jeff Romine 
To: AECM@LISTSERV.LOYOLA.EDU 
Sent: Thursday, March 07, 2002 5:58 PM 
Subject: Re: question

Can someone provide the name of the software package that allows students to input the answers to questions about a company and then will select several accounting packages for consideration? I would also appreciate hearing if anyone has good or bad experiences to share. - Jeff Romine

Fraud Continues to Haunt Online Retail Online fraud losses for 2001 were 19 times as high, dollar for dollar, as fraud losses resulting from offline sales, GartnerG2 found. http://www.newmedia.com/default.asp?articleID=3427 

March 11, 2002 message from Jagdish Gangolly

Ron,

I have been using PGP (Pretty Good Privacy) to illustrate most concepts in the area (Encryption/Decryption, Digital signatures, Digital certificates, Public Key Infrastructure, certificate authorities,key ring, ...).

It is freely available for download for MS-Windoze. Most unix installations will probably have it installed.

It is also very easy to use. Even some students in my class who have very little background are able to use it in a matter of days.

Hope this helps.

Regards,

Jagdish

Bob Jensen's network security threads are at http://www.trinity.edu/rjensen/ecommerce/assurance.htm 

From The Wall Street Journal Accounting Educators' Review on March 7, 2002

TITLE: Vivendi Posts Big Loss for 2001 After Write-Down of Goodwill
REPORTER: John Carreyrou
DATE: Mar 06, 2002
PAGE: B2
LINK: http://online.wsj.com/article/0,,SB1015349100950078120.djm,00.html 
TOPICS: Accounting, Goodwill, Accounting Theory, International Accounting, Valuations

SUMMARY: Vivendi Universal SA reported the biggest loss in French corporate history due to a 15.7-billion-euro write-down of goodwill.  Additional write-downs of assets and increases in reported debt will occur when Vivendi begins reporting under U.S. GAAP.  Questions focus on accounting for goodwill and differences between U.S. GAAP and French GAAP.

QUESTIONS:

1.) Describe accounting for goodwill under current U.S. GAAP.  Describe what the article refers to as "old U.S. rules."  Compare and contrast accounting for impaired goodwill under current U.S. GAAP and old U.S. GAAP.

2.) The article states that "[u]nder the old U.S. rules, companies could write down goodwill gradually, over many years. But, under the new rules, the goodwill has to be written down entirely as soon as it is deemed overvalued."  Do you think that this statement fairly reflects the old and new rules for accounting for goodwill?  Support your answer.

3.) What differences between French GAAP and U.S. GAAP are mentioned in the article?  Compare and contrast French GAAP and U.S. GAAP on these issues.

4.) Why would a French corporation prepare financial statements under U.S. GAAP?  Is Vivendi any less profitable when financial statements are prepared in accordance with U.S. GAAP?  Support your answer.

Reviewed By: Judy Beckman, University of Rhode Island
Reviewed By: Benson Wier, Virginia Commonwealth University
Reviewed By: Kimberly Dunn, Florida Atlantic University

Renaissance Secrets (including how women worked within societal and cultural constraints) 
http://www.open2.net/renaissance2/doing/doing.html 

New from JASC Software

After Shot picks up where your digital camera leaves off so you can complete all your photo tasks quickly and easily. Designed to work the way you do, After Shot is filled with amazing, easy-to-use tools that are literally just a click or two away. After Shot makes your digital photography experience what it should be – fun, fast, and simple! --- http://deals.jasc.com/promos/ashot/EAFSFS.asp 

Patrick Charles forwarded the link http://www.icaew.co.uk/index.cfm?AUB=TB2I_30478&CFID=1346135&CFTOKEN=3 

Seven of Europe’s leading accountancy Institutes* have announced a joint project to explore how to bring their professional qualifications closer together within, approximately, five years.

The Institutes hope that the project will result in the greater part of the content of the curricula for their qualifications being common to all the Institutes. The Institutes will also explore the potential for common learning materials, education, examination and other forms of assessment for the proposed common content.

Michael Groom, President of the Institute of Chartered Accountants in England and Wales, commented:

"Our members operate in a global business environment and the common content project would enhance the portability of their qualification. The Institutes involved in the project believe that there is significant and growing demand for the highest quality global accountancy qualifications. We are working together because we can see real benefits from the project to the wider business community as well as for our members, their firms and their employers."

The Institutes envisage that a prospective member would be able to satisfy the assessment criteria for the common content in any of the participating countries. A prospective member would satisfy the national content in the country in which he or she wants Institute membership or the right to practise.

Each Institute will consult the appropriate supervisory, regulatory and examination bodies about this project as well as its members, their firms and other employers of members. The participating Institutes also intend to advise other major Institutes, the International Federation of Accountants (IFAC) and the Federation of European Accountants (FEE) about the nature of the project and seek their involvement at the appropriate time.

*The seven Institutes participating in the project are:

• Institute of Chartered Accountants in England and Wales (ICAEW)
• Ordre des Experts-Comptables (OEC) (France)
• Institut der Wirtschaftsprüfer (IDW) (Germany)
• Institute of Chartered Accountants in Ireland (ICAI)
• Consiglio Nazionale de Dottori Commercialisti (CNDC) (Italy)
• Koninklijk Nederlands Instituut van Registeraccountants (NIVRA) (The Netherlands)
• Institute of Chartered Accountants of Scotland (ICAS)

Background:

Under the common content project, the Institutes would retain their respective national professional qualifications but the greater part of the curricula for those national qualifications would become common to all the Institutes. In order to implement the project, therefore, the Institutes need to:

agree a common content for the curricula of all their qualifications; and identify a national content for the curriculum of each individual qualification. A prospective member of an Institute would become qualified by satisfying the assessment criteria for the common content in any participating country and for the national content in the particular country or countries in which he or she wants Institute membership or the right to practise. Satisfying the criteria for the national content with ICAEW, ICAS or ICAI would, as now, enable members to practise throughout the United Kingdom and Ireland.

The common content will be developed on the assumption that each Institute’s qualification is a business and finance qualification.

The common content will be designed to:

be attractive to top quality graduates and other potential entrants to the profession; be relevant to accounting firms and other businesses who train, employ or use the services of holders of the qualifications; facilitate the use of global education and training; and meet the increased competition from other qualifications and career paths (with or without qualifications).

SPECIAL REPORT: THE TECH REBOUND Tech's Best Hope: Pockets of Prosperity Within the industry, some sectors will outrun others. And within sectors, only some companies will benefit. But 2002 sure will beat 2001
http://www.businessweek.com/technology/content/mar2002/tc20020315_8603.htm?c=bwtechmar19&n=link3&t=email 

Mark Twain: A Film Directed by Ken Burns  (Literature, History)  --- http://www.pbs.org/marktwain/ 

Early Modern Women Resources http://35a-505.umd.edu/emw/early_modern.php3 

Most K-12 textbooks are inspired more by political correctness than facts.  John Hubisz is a leading scientist attempting to force publishers to get the facts right.

March 5 Message from John L. Hubisz [hubisz@mindspring.com] 

The website is finally up and running. The site address is http://www.science-house.org/middleschool/  and can be accessed now.

This note is being sent to those folks, who over the past year expressed an interest in Middle School physical science. Most were following up a reference to a report on a review of several middle school physical science books mentioned in a newspaper article, a newsmagazine, a newsletter, on a radio talk show, in a TV interview, or by word of mouth. I want to be able to provide valuable assistance to anyone and everyone interested in seeing to it that the Middle School student's experience in physical science is a positive one and one that encourages further interest in the study of science.

Feel free to make suggestions and contributions to improve the site's content.

My aim is to keep the tone positive. When errors are cited, there will be suggestions for improvement. I will try to influence states and school districts to see that for the most part their methods of choosing textbooks is seriously flawed and needs to be changed.

Best wishes,

John L. Hubisz
Hubisz@unity.ncsu.edu 

John L. Hubisz, Physics Department, Box 8202, North Carolina State University, Raleigh NC 27695-8202; hubisz@unity.ncsu.edu, (919)515-2515, (919)515-7331 FAX

Reply from Jane Jackson

Colleagues: 
Below are excerpts from an important new book that reviews HIGH QUALITY middle school science programs. It's a result of research by the Education Development Center, Inc., in Boston.

You can easily download the several pdf documents that constitute the book (256 pages) at http://www.middleweb.com/EDC/EDCscience.html 

See also http://www.middleweb.com/EDC/EDCmain.html  for a new book that reviews high quality middle school MATH programs.

Cheers, Jane Jackson, 
Dept. of Physics, Arizona State University

Invasion of the "Porn Nappers" Beware: Smut-site owners are waiting to grab your URL if you allow your registration for it to lapse --- http://www.businessweek.com/bwdaily/dnflash/mar2002/nf2002037_2837.htm?c=bwtechmar08&n=link3&t=email 

From The AccountingWeb on March 4, 2002

Book Recommendation: Excel 2000 Answers, By Gail Perry, CPA

A whole book of Excel 2000 Answers for less than the price of one support call! Why pay $50, $100, $150, or even more for one phone call to tech support when you can have the answers you need at your fingertips for under $25? Get this valuable, reader-friendly book and you'll get hundreds of answers to all of your basic to advanced Excel 2000 questions, straight from the databases of Stream International--the world's largest third-party tech support organization. http://www.amazon.com/exec/obidos/ASIN/0072118830/accountingweb 

Hi George,

I am back for a day and hundreds of email messages in a queue. But your message below caught my eye.

Utility functions are never identical between people. What is ideal for one is sub-optimal for another, and Arrow's Impossibility Theorem tells us that it is impossible to optimize everybody's utility at the same time (maybe in heaven?)

Utility functions are temporal. When I was a newly minted graduate, the ideal job, I thought, would was awaiting me Colorado where I planed to hold class 12 hours per week for a full salary while skiing and chasing women the rest of the week. Professor Herb Miller, who was a visiting professor at Stanford at the time, took me under his wing and convinced me that I would be miserable if I did not choose a research university where I could teach six hours a week and do research for 70 hours a week. Turned out he was correct. (Among other things, I'd be dead given my hot dog style of skiing.)

Some faculty love face-to-face interactions with students all day long (Alice Nichols at FSU comes to mind during the four years that I was chair of FSU's accounting department). Most research professors would run and hide if students wanted to interrupt them all day long. Some professors will give all the time in the world to graduate students but prefer to brush away the undergraduates (or vice versa).

When I was a newly minted assistant professor at Michigan State, one of my colleagues taught the first economics course to over 1,000 students every semester (some live and some on piped TV into dormitory classrooms where TAs took role and answered questions). Al M. asserted that the best job in the university was to teach over 1,000 students each term. Then you never had to see a student, read a paper, or grade a test (computers graded all tests). It was like being the preacher whose only duty was to give one sermon a week.

The answer pure and simple is that colleges are big institutions where faculty and students have different utilities and needs. I am really bothered by the publish or perish mentality that shuts down the really great face-to-face teachers outside the classroom unless they were mistakenly (in the eyes of some colleagues) given tenure with little or no research on their record. At the same time, I am bothered by research professors who collect a paycheck but can never be found on campus.

My advice is to march to your own drummer, but only after you have tenure.  Hopefully, however, someone is tending to the flock on campus.

Bob Jensen

-----Original Message-----
From: glan@UWINDSOR.CA [mailto:glan@UWINDSOR.CA] 
Sent: Monday, March 11, 2002 9:20 AM
To: AECM@LISTSERV.LOYOLA.EDU Subject:
Re: Acctg. Prof. - "My Dream Campus Interview"

Is there a "dream" teaching job? Aside from pecuniary incentives and recognizing the diversity of situations and preferences, is there an "ideal" teaching load, research atmosphere and level of interaction with faculty and students?

Should the regular course load in the business school be three and three i.e. a total of six courses per year or a different number? Class size will also be a factor- should there be class limit to say third and fourth year classes in accounting ? Is it preferable to teach three sections of the same course in a semester (one prep) or to have two or three preps ? Do you find a large amount of difference in the number of hours you spend preparing for some accounting courses as opposed to other accounting courses? ( A senior accounting faculty, who has retired a while ago, once told me that accounting is like throwing jello on the wall -- it does not stick; hence a lot of preparation is required.) Do availability of T.As and G.As make a big difference, especially re marking of assignments? Do you mark all your midterms and final exams or do you make use of T.As and G.As to mark some exams?

Should there be a course or two off for those actively doing research ?Is it the dean's job to ensure that the faculty have the data bases (such as CRSP tapes and COMPUSTAT)or is it the responsibility of the faculty member to do whatever it takes to have access to the data? (e.g. obtaining permission and commuting to another university that have these data). Is having the time to do research the most important factor?

Do you have students waiting in line outside your office to see you during your office hours? I am amazed by my neighbour- there is always one or two students in his office during his office hours and usually I have to navigate through a throng of students waiting in the hallway to see him to get to my office. ( I only have a few students occasionally coming to see me!). Should faculty members, especially the new ones, spend more time in the office?

In the final analysis, what would you consider to be the significant rewards of a "dream" teaching job? The flexibility of the working hours, the opportunities to travel to exotic places for conferences, the success of former students, self-actualization...

George Lan
University of Windsor

On 10 Mar 2002, at 17:17, Barry Rice wrote:

From: The Chronicle of Higher Education, Wednesday, March 6, 2002. http://chronicle.com/jobs/2002/03/2002030601c.htm  

 "Driving home from my last campus interview, I felt like Sarah Hughes making a perfect landing on her Olympic gold figure-skating routine.   As a tenured associate professor of accounting and business at a small > private college in the Midwest, I had ventured out on the job market  for the first time in 18 years..." 

Book Recommendation: Practice What You Preach, By David Maister
Maister, a professional service consultant, surveyed 6,500 employees at 50 worldwide companies to evaluate the relationship between company financial performance and employee satisfaction and loyalty. Here, he offers detailed commentary from CEOs, managers and staffers, and analysis of the survey results. http://www.amazon.com/exec/obidos/ASIN/0743211871/accountingweb 

From Cindy

This is an interesting site that might be helpful in understanding why this war is taking so long.
http://wire.ap.org/APpackages/caves_flash/index.html 

Paul Adams works up a lather over the Simple Object Access Protocol, a fast, easy, XML-based way for Web aps to talk to each other --- http://hotwired.lycos.com/webmonkey/02/08/index0a.html 

 Bob Jensen's XML threads are at http://www.trinity.edu/rjensen/xmlrdf.htm 

The AccountingWeb's Book Recommendation: Strategic Management of Professional Service Firms, by Bente R. Lowendahl

Professional service firms play an increasingly important role in the value creation of today's business as well as public sector organizations. This book describes in detail the driving forces behind the challenges involved in management of a professional service firm. Based on in-depth studies of firms in multiple industries, the book presents a number of examples as well as a framework for the development of firm strategies. http://www.amazon.com/exec/obidos/ASIN/8716135083/accountingweb 

Forwarded on March 5, 2002 by Desiree Pratt

The World's Flags Given Letter Grades (some reviews are really funny) --- http://138.251.140.21/~josh/flags/intro.html 

Forwarded by Dick Haar

A Flag As A Tax Symbol? A visitor from Holland was chatting with his American friend and was jokingly explaining about the red, white and blue in the Netherlands flag. "Our flag symbolizes our taxes," he said. "We get red when we talk about them, white when we get our tax bill, and blue after we pay them." "Oh, that's the same with us," nodded the American, "Only we see stars, too!"

The owner of a small deli was being questioned by an IRS agent about his tax return. He had reported a net profit of $80,000 for the year. "Why don't you people leave me alone?" the deli owner said. " I work like a dog, everyone in my family helps out, the place is only closed three days a year, and you want to know how I made $80,000?" "It's not your income that bothers us" the agent said. "It's these deductions. You listed six trips to Bermuda for you and your wife." "Oh, that," the owner said smiling. "I forgot to tell you -- we also deliver."

A new arrival, about to enter the hospital saw two white-coated doctors searching through the flower beds. "Excuse me," he said, "have you lost something?" "No" replied one of the doctors. "We're doing a heart transplant for an IRS Agent and want to find a suitable rock."

Q: Are birth control pills deductible? A: Only if they don't work.

There is only one thing worse than the flu season -- the tax season. You can recover from the flu.

Internal Revenue Service Theme Song 

Tax his cow, tax his goat, 
tax his pants, tax his coat. 

Tax his crop, tax his work, 
tax his ties, tax his shirt. 

Tax his chew, tax his smoke, 
teach him taxing is no joke. 

Tax his tractor, tax his mule, 
tell him taxing is the rule. 

Tax his oil, tax his gas, 
tax his notes, tax his cash. 

Tax him good and let him know 
that after taxes he has no dough. 

If he hollers, tax him more; 
tax him till he's good and sore. 

Tax his coffin, tax his grave, 
tax his sod in which he's laid. 

Put these words upon his tomb, 
"Taxes drove him to his doom." 

After he's gone, we won't relax. 
We'll still collect inheritance tax.

And last but not least - Death & Taxes 
A businessman on his deathbed called his friend and said "I want you to promise me that when I die you will have my remains cremated." "And what do you want me to do with your ashes?" the friend asked. The businessman said, "Just put them in an envelope and mail them to the Internal Revenue Service and write on the envelope 'Now you have everything'."

HAPPY TAX SEASON

Forwarded by Don Ramsey

Susie Jones goes to the cemetery to visit her husband's grave, but she can't remember the exact location of the plot. The office tells her they have no plot under the name Herman Jones, but they do have one for Susie Jones. "That's him!" she says. "He put everything in my name."

Forwarded by George Lan

Some differences between an accountant and a financial analyst.

You have probably heard the joke about accountants giving you the numbers that you want. Here is a common one about financial analysts.

A potential investor came to seek investment advice from a financial analyst (F.A.). The F.A. told the investor, " I have the experience, you have the money."

Several weeks later, after the investor has lost all the money from following the advice of the F.A., the investor came to see the F.A. and the F.A. said to the investor:

"You have the experience, I have the money!"

Bob Jensen's Enron humor is at http://www.trinity.edu/rjensen/fraud.htm#Humor 

Forwarded by Dick Haar

A man left from work one Friday afternoon. But instead of going home, he stayed out the entire weekend hunting with the boys & spending his entire paycheck. When he finally appeared at home, Sunday night, he was confronted by his very angry wife and was barraged for nearly 2 hours with a tirade of yelling about his actions...

Finally his wife stopped the nagging and simply said to him "How would you like it if you didn't see me for 2 or 3 days?"

To which he replied, "That would be fine with me."

Monday went by & he didn't see his wife. Tuesday & Wednesday came & went with the same results. On Thursday, the swelling went down just enough where he could see her a little out of the corner of his left eye.

Dear Grandson: 

I have become a little older since I saw you last, and a few changes have come into my life since then. Frankly, I have become a frivolous old gal. I am seeing five gentlemen everyday.

As soon as I wake up, Will Power helps me get out of bed. Then I go to see John. Then Charlie Horse comes along, and when he is here he takes a lot of my time and attention.

When he leaves, Arthur Ritis shows up and stays the rest of the day. He doesn't like to stay in one place very long, so he takes me from joint to joint.

After such a busy day, I'm really tired and glad to go to bed with Ben Gay. What a life. Oh yes, I'm also flirting with Al Zymer.

Love, 
Grandma

P.S. The preacher came to call the other day. He said at my age I should be thinking of the hereafter. I told him, "Oh I do it all the time. No matter where I am, in the parlor, upstairs, in the kitchen, or down in the basement, I ask myself ... "Now, what am I here after?"

A blonde was bragging about her knowledge of state capitals. She proudly says, "Go ahead, ask me, I know all of them." A friend says, "OK, what's the capital of Wisconsin?" 
The blonde replies, "Oh, that's easy: W."

What did the blonde ask her doctor when he told her she was pregnant?  
"Can you run a DNA test to see if it's mine?"

Forwarded by Auntie Bev

Puns:

  My wife really likes to make pottery, but to me it's just kiln time.

  Dijon vu - the same mustard as before.

  Practice safe eating - always use condiments.

  I fired my masseuse today. She just rubbed me the wrong way.

  A Freudian slip is when you say one thing but mean your mother.

  Shotgun wedding A case of wife or death.

  I used to work in a blanket factory, but it folded.

  I used to be a lumberjack, but I just couldn't hack it, so they gave me the axe.

  A man needs a mistress just to break the monogamy.

  Marriage is the mourning after the knot before.

  A hangover is the wrath of grapes.

  Corduroy pillows are making headlines.

  Is a book on voyeurism a peeping tome?

  Dancing cheek-to-cheek is really a form of floor play.

  Banning the bra was a big flop.

  Sea captains don't like crew cuts.

  Does the name Pavlov ring a bell?

  A successful diet is the triumph of mind over platter.

  Time flies like an arrow. Fruit flies like a banana.

  A gossip is someone with a great sense of rumor.

  Without geometry, life is pointless.

  When you dream in color, it's a pigment of your imagination.

  Condoms should be used on every conceivable occasion.

  Reading whilst sunbathing makes you well-red.

  When two egotists meet, it's an I for an I.

  If electricity comes from electrons... does that mean that

  Morality comes from morons?

Forwarded by Debbie Bowling

Garbage Lawyer Department
If you damage your car by hitting a wild animal (such as a deer), you can now sue the wildlife agency in the state where the accident happened.  See http://www.washtimes.com/sports/20020310-39328075.htm 

Forwarded by Bob Overn

A programmer is someone who solves a problem you didn't know you had in a way you don't understand.

An auditor is someone who arrives after the battle and bayonets then counts all the wounded.

A banker is a fellow who lends you his umbrella when the sun is shining and wants it back the minute it begins to rain. (Mark Twain)

An economist is an expert who will know tomorrow why the things he predicted yesterday did not happen today.

A statistician is someone who is good with numbers but lacks the personality to be an accountant.

A mathematician is a blind man in a dark room looking for a black cat that is not there.

A topologist is a man who does not know the difference between a coffee cup and a doughnut.

A lawyer is a person who writes a 10,000-word document and calls it a "brief."

A psychologist is a man who watches everyone else when a beautiful girl enters the room.

A professor is one who talks in someone else's sleep.

A consultant is someone who takes the watch off your wrist and tells you the time.

A diplomat is someone who can tell you to go to Antarctica in such a way that you will look forward to the trip.

Forwarded by Dick Haar

Secrets if a Successful Marriage

1.  Two times a week, we go to a nice restaurant, have a little wine, some good food and companionship.
She goes Tuesday's, I go Friday's.

2. We also sleep in separate beds. Hers is in San Francisco and mine is in Denver.

3. I take my wife everywhere, but she keeps finding her way back.

4. I asked my wife where she wanted to go for our anniversary. "Somewhere I haven't been in a long time!" she said. So I suggested the kitchen.

5. We always hold hands. If I let go, she shops.

6. She has an electric blender, electric toaster, and electric bread maker. Then she said, "There are too many gadgets, and no place to sit down!" So I bought her an electric chair.

7. My wife told me the car wasn't running well because there was water in the carburetor. I asked where the car was. She told me, "In the lake."

8. She got a mudpack and looked great for two days.
    Then the mud fell off.

9. She ran after the garbage truck, yelling, "Am I too late for the garbage?" The driver said, "No, jump in!"

10. Remember....Marriage is the number one cause of divorce.

11. Statistically, 100% of all divorces start with marriage.

12. I married Miss Right. I just didn't know her first name was Always.

13. I haven't spoken to my wife for 18 months. I don't like to interrupt her.

14. The last fight was my fault. My wife asked, "What's on the TV?"...I said, 'Dust!"

15. In the beginning, God created earth and rested.
     Then God created man and rested. Then God created woman............
     Since then, neither God nor man has rested.

Forwarded by Dick Haar

1. If you're too open minded, your brains will fall out.

2. Age is a very high price to pay for maturity.

3. Going to church doesn't make you a Christian any more than going to a garage makes you a mechanic.

4. Artificial intelligence is no match for natural stupidity.

5. If you must choose between two evils, pick the one you've never tried before.

6. My idea of housework is to sweep the room with a glance.

7. Not one shred of evidence supports the notion that life is serious.

8. It is easier to get forgiveness than permission.

9. For every action, there is an equal and opposite government program.

10. If you look like your passport picture, you probably need the trip.

11. Bills travel through the mail at twice the speed of checks.

12. A conscience is what hurts when all your other parts feel so good.

13. Eat well, stay fit, die anyway.

14. Men are from earth. Women are from earth. Deal with it.

15. No husband has ever been shot while doing the dishes.

16. A balanced diet is a cookie in each hand.

17. Middle age is when broadness of the mind and narrowness of the waist change places.

18. Opportunities always look bigger going than coming.

19. Junk is something you've kept for years and throw away three weeks before you need it.

20. There is always one more imbecile than you counted on.

21. Experience is a wonderful thing. It enables you to recognize a mistake when you make it again.

22. By the time you can make ends meet, they move the ends.

23. Thou shall not weigh more than thy refrigerator.

24. Someone who thinks logically provides a nice contrast to the real world.

25. Blessed are they who can laugh at themselves for they shall never cease to be amused.

Also forwarded by Dick Haar

The elder priest speaking to the younger priest said, "I know you were reaching out to the young people when you had bucket seats put in to replace the first four pews. It worked. We got the front of the church filled first."

The young priest nodded and the old one continued, "And, you told me a little more beat to the music would bring young people back to church, so I supported you when you brought in that rock'n roll gospel choir that packed us to the balcony."

"So," asked the young priest, "What's the problem?"

"Well," said the elder priest, "I'm afraid you've gone too far with the drive-thru confessional."

"But Father," protested the young priest, "My confessions have nearly doubled since I began to do that!"

"I know, I know, my son, but that flashing neon sign "Toot 'n Tell or Go to Hell" really has to go."

And that's the way it was on March 25, 2002 with a little help from my friends.

In March 2000, Forbes named AccountantsWorld.com as the Best Website on the Web --- http://accountantsworld.com/.
Some top accountancy links --- http://accountantsworld.com/category.asp?id=Accounting

For accounting news, I prefer AccountingWeb at http://www.accountingweb.com/ 

Another leading accounting site is AccountingEducation.com at http://www.accountingeducation.com/ 

Paul Pacter maintains the best international accounting standards and news Website at http://www.iasplus.com/

How stuff works --- http://www.howstuffworks.com/ 

Bob Jensen's video helpers for MS Excel, MS Access, and other helper videos are at http://www.cs.trinity.edu/~rjensen/video/ 
Accompanying documentation can be found at http://www.trinity.edu/rjensen/default1.htm and http://www.trinity.edu/rjensen/HelpersVideos.htm 

Professor Robert E. Jensen (Bob) http://www.trinity.edu/rjensen
Jesse H. Jones Distinguished Professor of Business Administration
Trinity University, San Antonio, TX 78212-7200
Voice: 210-999-7347 Fax: 210-999-8134  Email:  rjensen@trinity.edu  

March 4, 2002 

 Bob Jensen's New Bookmarks on March 4, 2002
Bob Jensen at Trinity University 

Quotes of the Week

Quotations on the Topic of Investment Banking, Structured Financing, and Derivatives

JP Morgan – whose lawyers must be working overtime – is refuting any wrongdoing over credit default swaps it sold on Argentine sovereign debt to three hedge funds. But the bank failed to win immediate payment of $965 million from the 11 insurers it is suing for outstanding surety bonds.
Christopher Jeffery Editor, March 2, 2002, RiskNews http://www.risknews.net 
Note from Bob Jensen:  The above quotation seems to be Year 2002 Déjà Vu in terms of all the bad ways investment bankers cheated investors in the 1980s and 1990s.  Read passage from Partnoy's book quoted at http://www.trinity.edu/rjensen/book02q1.htm#022502 

Enron was its own investment bank on many deals, especially in credit derivatives. You can read the following at http://www.trinity.edu/rjensen/fraud.htm 

Selected quotations from "Why Enron Went Bust: Start with arrogance. Add greed, deceit, and financial chicanery. What do you get? A company that wasn't what it was cracked up to be." by Benthany McLean, Fortune Magazine, December 24, 2001, pp. 58-68.

Why Enron Went Bust: Start with arrogance. Add greed, deceit, and financial chicanery. What do you get? A company that wasn't what it was cracked up to be."

In fact, it's next to impossible to find someone outside Enron who agrees with Fasto's contention (that Enron was an energy provider rather than an energy trading company). "They were not an energy company that used trading as part of their strategy, but a company that traded for trading's sake," says Austin Ramzy, research director of Principal Capital Income Investors. "Enron is dominated by pure trading," says one competitor. Indeed, Enron had a reputation for taking more risk than other companies, especially in longer-term contracts, in which there is far less liquidity. "Enron swung for the fences," says another trader. And it's not secret that among non-investment banks, Enron was an active and extremely aggressive player in complex financial instruments such as credit derivatives. Because Enron didn't have as strong a balance sheet as the investment banks that dominate that world, it had to offer better prices to get business. "Funky" is a word that is used to describe its trades.

I was particularly impressed, as were all people who phoned in, by the testimony of Scott Cleland (see Tuesday, January 15) and then click on the following link to read his opening remarks to a Senate Committee on December 18. If you think the public accounting profession has an "independence problem," that problem is miniscule relative to an enormous independence problem among financial analysts and investment bankers --- two professions that are literally rotten to the core. Go to http://www.c-span.org/enron/scomm_1218.asp#open 

A portion of Mr. Cleland's testimony is quoted below:

Four, it's common for analysts to have a financial stake in the companies they're covering. That's just like, essentially, allowing athletes to bet on the outcome of the game that they're playing in.

Five, most payments for investment research is routinely commingled in the process with more profitable investment banking and proprietary trading. The problem with this is it effectively means that most research analysts work for the companies and don't work for investors.

Six, credit agencies may have conflicts of interest.

Seven, analysts seeking investment banking tend to be more tolerant of pro-forma accounting and the conflict there is, essentially, the system is allowing companies to tell -- you know, to make up their own accounting. To describe their own financial performance, that no one then can compare objectively with other companies.

Eight, surprise, surprise, companies routinely beat the expectations of a consensus of research analysts that are seeking their investment banking business.

You can read about traunches and other misuses of derivatives by investment bankers in structured financings at http://www.trinity.edu/rjensen/acct5341/speakers/133glosf.htm#CreditDerivatives 

Other Quotations

Just another day on the river
Forwarded by Phil Cooley http://koti.mbnet.fi/~soldier/towboat.htm  (Try it for the amazing photographs!)

Pupils eat that which the teachers have digested
Karl Krauss

The journalist is stimulated by a deadline. He writes worse if he has time
Karl Krauss

Suppose you were an idiot . . . and suppose you were a member of Congress . . . But I repeat myself.
Mark Twain

Expansion means complexity and complexity decay.
Cyril  Parkinson

However, over the last decade, railroads have been engaged in their own version of an information revolution. The combination of computers and wireless systems gives railroads greater customer service capacity and better dispatching and cost controls—as well as dispensing with armies of clerks. Charles Dettmann, executive vice president for operations, research and technology at the Washington, DC-based Association of American Railroads, argues that railroads’ competitiveness—perhaps even their existence—depends on their use of information technologies.
Don Philips, Technology Review (from MIT), March 2002 --- http://www.techreview.com/articles/philips0302.asp 

"Historically, companies have been forced to evaluate ethics programs on the basis of outputs, such as training sessions and hotline calls, rather than real outcomes," said the head of Andersen's ethics group, Dr. Barbara Ley Toffler. "The result has been misdirected investment and concern among senior executives about the real value of these programs."
"Andersen Introduces Yardstick for Employee Ethics Programs," The Electronic Accountant, June 15, 1999 --- http://www.electronicaccountant.com/news/1999/061599_4.htm 

In particular, it has raised awareness of “hollow swaps”, where two telecoms companies exchange identical amounts of network capacity, then book the purchase cost as capital expense and the sale as revenue. Although C&W says it does not use hollow swaps, it has recently admitted to using another controversial accounting method to book the sale of “indefeasible right of use” (IRU) contracts. C&W booked the contracts, which give access to its telecoms network, as upfront revenue even though they were spread over periods of up to 15 years. Such deals — which were outlawed in 1999 by regulators in America — boosted C&W’s revenues by £373 million in 2001.
Chris Ayres and Clive Mathieson, London Times Online, March 1, 2002 --- http://www.thetimes.co.uk/article/0,,5-222235,00.html 
Bob Jensen's threads on financial derivatives instruments frauds are at http://www.trinity.edu/rjensen/fraud.htm#DerivativesFraud 

US GAAP is under attack on the world stage, and the case for acceptance of international accounting standards is gaining momentum. Will the U.S. lose its authority over how foreign firms file financial statements for the U.S. market? What's happening and why? 
http://www.accountingweb.com/item/73130 

Porn websites are making millions. Now mainstream dot.coms are asking them for advice. 
Sara Gaines in The Guardian, February 25, 2002 --- http://www.guardian.co.uk/online/story/0,3605,659159,00.html 

The Online Computer Library Centre's annual review found 74,000 adult websites last year, accounting for 2% of sites on the net, and together they bring in profits of more than $1billon. Though many are small scale, with half making $20,000 a year, even that figure is the envy of many mainstream brands.
Ibid

When Ashe is not posing naked on her site, Danni's Hard Drive, she has a growing list of business engagements. Last year these included speeches at the Streaming Media Asia seminar in Hong Kong and the Internet World Conference in Sydney, and Ashe has twice testified before US congressional committees on child protection and internet-related issues.
Ibid
(Her site does not seem to offer any child protection.)

The Catholic church gives its blessings to the Internet, saying it's a "marvelous technological tool." But it also says that the "ideology of radical libertarianism is both mistaken and harmful."  
Farhad Manjoo, "What Would Jesus Surf?, Wired News  --- http://www.wired.com/news/culture/0,1284,50757,00.html 

Enron:  Updates on March 4, 2002 --- 
http://www.trinity.edu/rjensen/fraud030402.htm

My answer proposed at http://www.trinity.edu/rjensen/fraudConclusion.htm#MyAnswer 
My answer, albeit naive, is that auditing firms must begin to "warrant" or "insure" their services much like insurance companies insure against liability with limits as to what they will pay such as limits to liability in automobile accidents.  Clients should decide how much auditing liability insurance they are willing to purchase as a component of the total audit fee.  The insured liability limit  should be publicized on Page 1 of a corporate annual report and in stock price listings in newspapers and on the Internet.  Accordingly, the amount of insured audit liability would then become an important input into investor and creditor decisions.  Firms paying for lower audit liability would then pay the price by having a higher cost of capital.   This does not mean that all audits should not be held accountable to identical high auditing standards or that audit insurance claims can be filed for stock price declines.  Claims should only be filed when there is evidence of audit negligence and/or fraud.

This is not a proposal that I have worked out in any kind of detail. Two components that I would like to include are as follows:

1. A whistle blowing incentive scheme that will help disclose breakdowns in the services.
   
   
   
2. For claims to be adjudicated in an "accounting court" very similar to the "court" proposed by the most famous managing partner (Leonard Spacek) in the history of Arthur Andersen --- Spacek, L., "The Need for an Accounting Court", The Accounting Review, l958, pp. 368-379.  Whereas Spacek was more concerned with the setting of accounting principles and resolving disputes between auditors and clients, my vision would expand upon this concept.  I think what I envision is both an accounting justice system that would review the merits of claims and press charges for wrongful acts in the accounting court.

Also see http://www.trinity.edu/rjensen/damages.htm 

Dan Whatley set out to expose what he saw as Enron-style corporate malfeasance on an Internet message board. Now he has a judgment against him for $450,000. His story is not uncommon --- http://www.wired.com/news/business/0,1367,50548,00.html 

Bad Flashing versus Good Flashing (Webpage Design, Authoring) --- http://www.flash99good.com/ 

Bob Jensen's threads on authoring are at http://www.trinity.edu/rjensen/000aaa/thetools.htm 

Innovation of the Week:  Augmented Reality
Believe it or not, this may be the prototype for the killer app in portable computing. It's called augmented reality and it alters how we see the world. But there's still a little work to be done.

"Augmented Reality," by Steve Ditlea, Popular Science --- http://www.popsci.com/popsci/computers/article/0,12543,190327,00.html 

Walk down the street, look at the world. This is reality. Now repeat, but wearing an odd-looking, bulky pair of glasses that place into your line of vision selective, relevant bits of data about the world; the data hovers in sight like virtual Post-it Notes, annotating your view. This is augmented reality. Glasses on, you glance to the right, at a vaguely familiar restaurant, and click a small button in your hand. Up pops text reminding you that Tom's Restaurant was the model for the diner on "Seinfeld"; not only that, but -- according to the glasses, at least -- the Morningside salad is worth ordering.

When the technology for augmented reality (AR) is fully developed, the gear won't amount to much more than glasses and some sort of small unit like a PDA. Right now, though, it consists of about 26 pounds of equipment that gets strapped to the back and to the head, along with a shoulder-perching flying saucer-shaped antenna. The Mobile Augmented Reality System (MARS), developed at Columbia University (not far from Tom's Restaurant), has been assembled from off-the-shelf technology, including a 1GHz Dell laptop with a graphics accelerator chip and soap-bar-sized batteries to power the display glasses and the critical positioning and orientation technologies. Strap on this rig and you look like a robothief on the lam from CompUSA.

But if you do strap on this rig, as I have, you begin to