New Bookmarks
Year 2007 Quarter 1:  January 1 - March 31 Additions to Bob Jensen's Bookmarks
Bob Jensen at Trinity University

For earlier editions of New Bookmarks go to http://www.trinity.edu/rjensen/bookurl.htm 
Tidbits Directory --- http://www.trinity.edu/rjensen/TidbitsDirectory.htm 

Click here to search Bob Jensen's web site if you have key words to enter --- Search Site.
For example if you want to know what Jensen documents have the term "Enron" enter the phrase Jensen AND Enron. Another search engine that covers Trinity and other universities is at http://www.searchedu.com/.

March 31, 2007

Bob Jensen's New Bookmarks Between January 1 and March 31, 2007
Bob Jensen at Trinity University 

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

Click here to search Bob Jensen's web site if you have key words to enter --- Search Site.
For example if you want to know what Jensen documents have the term "Enron" enter the phrase Jensen AND Enron. Another search engine that covers Trinity and other universities is at http://www.searchedu.com/.

Bob Jensen's Blogs --- http://www.trinity.edu/rjensen/JensenBlogs.htm
Current and past editions of my newsletter called New Bookmarks --- http://www.trinity.edu/rjensen/bookurl.htm
Current and past editions of my newsletter called Tidbits --- http://www.trinity.edu/rjensen/TidbitsDirectory.htm
Current and past editions of my newsletter called Fraud Updates --- http://www.trinity.edu/rjensen/FraudUpdates.htm
 

Bob Jensen's past presentations and lectures --- http://www.trinity.edu/rjensen/resume.htm#Presentations   
 

Bob Jensen's various threads --- http://www.trinity.edu/rjensen/threads.htm
       (Also scroll down to the table at http://www.trinity.edu/rjensen/ )

Click here to search this Website if you have key words to enter --- Search Site.
For example if you want to know what Jensen documents have the term "Enron" enter the phrase Jensen AND Enron. Another search engine that covers Trinity and other universities is at http://www.searchedu.com/.

Bob Jensen's Home Page is at http://www.trinity.edu/rjensen/

Tidbits and Quotations Between January 1 and March 31, 2007

2007
April 3     

2007
March 9                    March 15              March 20          March 26

February 25 (There were fewer editions this month due to Erika's surgeries)

2007
January 3              January 8          January 30

Tidbits Directory for Earlier Years --- http://www.trinity.edu/rjensen/TidbitsDirectory.htm

Click Here for Humor Between January 1 and March 31, 2007

Bob Jensen's complete set of Enron Updates are at http://www.trinity.edu/rjensen/FraudEnron.htm#EnronUpdates

Bob Jensen's threads on the Enron scandal are at http://www.trinity.edu/rjensen/FraudEnron.htm

Accounting is a prime example of how close cooperation with our US partner is bearing fruit. The EU and the US are advancing on a roadmap for removal of reconciliation requirements based on the principle of equivalence. The Commission is working together with the US SEC towards removing the costly and unnecessary reconciliation requirements for IFRS and US GAAP. Earlier this month I met SEC Commissioner Christopher Cox and we took stock on the progress of the roadmap. I am pleased to confirm that we are well on track. We are both committed to further improving our regulatory cooperation.
Charlie McCreevy,  European Commissioner for Internal Market and Services, Priorities in the Internal (EU) Market --- http://www.iasplus.com/europe/0703mccreevy2.pdf

Accountant Shortage Increases Outsourcing
Today’s shortage of skilled accounting staff may be widening the need for outsourcing, reports the Ohio Society of CPAs Corporate Focus. Cutting costs is cited as the primary reason for finance and accounting outsourcing, according to 42 percent of those surveyed by FAO Research Inc. Lack of internal accounting and finance staff followed with 33 percent.
AccountingWeb, March 14, 2007 --- http://www.accountingweb.com/cgi-bin/item.cgi?id=103285

Pricewaterhouse Coopers (PwC) FAQs are online at http://www.cfodirect.pwc.com/CFODirectWeb/Controller.jpf

Congratulations to Don Carter for Receiving Canada's Outstanding Accounting Educator Award

March 20, 2007 message from John Gunn [Gunn@ica.bc.ca]

Hi Bob

I am pleased to advise that the committee has selected Don to receive the award. How about that??

Thanks for your contribution to making this happen.

Best wishes as Erika continues her recovery.

Regards,

John D. Gunn, MEd, FCA
CEO, CA School of Business

March 21, 2007 reply from Bob Jensen

Hi John,

Please let me know when there is a Website announcing the award. I would like to post the link in my newsletter called Tidbits.

I am thrilled that Don won this award. He’s exceptionally talented and dedicated to accounting education.

I’m also very proud to have been a small part of of CASB’s outstanding online masters program --- http://www.casb.com/
You've proved that competency-based education really works.

Robert (Bob) Jensen

Also see http://www.cs.trinity.edu/~rjensen/001cpe/01start.htm

"Microsoft Access: Best Spreadsheet Add-In," AccountingWeb, March 14, 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=103284

Of the main office applications used in professional firms, word processors are the least well used, spreadsheets the most overused, and databases the most underused. Part of the reason for this is that database applications are often seen as being the preserve of experienced developers, who use them to create comprehensive database applications.

This is indeed one of their capabilities, but desktop database applications can also be used to develop very effective solutions to a range of problems with no more technical skill, and often considerably less, than that which would be needed to solve the problem using a spreadsheet. The real benefit for many users of obtaining some understanding of databases comes not from creating standalone databases, but using or working with databases to get more out of their spreadsheets, word processors and accounts applications.

Think Link A key feature of a database is the ability to link easily to existing sources of data. This means that you can exploit the capabilities of a database without ever having to create your own tables of data or enter a single item of data. However, you do have to have some idea of how relational databases are constructed. Anyone who can manage to use an Excel Lookup function should be able to cope with this without too much difficulty.

This ability to link to existing data means that you can not only use existing tables of data from a single source, but also combine data from different sources, or add additional data of your own without having to interfere with any existing database or application. All you need is some basic understanding and a reliable link between the different tables of data such as a unique client code. By making data accessible in this way you can make your use of the other office applications a great deal more efficient and reliable.

Continued in article.

Bob Jensen's video tutorials on MS Access and Excel are at http://www.cs.trinity.edu/~rjensen/video/acct5342/
I prefer the wmv files to the rm compressions.

AICPA Launches 'Feed the Pig' Podcasts (What a dumb title for for a personal finance helper initiative)

AccountingWeb, March 27, 2007 ---http://www.accountingweb.com/cgi-bin/item.cgi?id=103336

Feed the Pig, the American Institute of Certified Public Accountants’ (AICPA) public service campaign, this week launched a free podcast series to instruct 25- to 34-year-olds on how to take control of their finances.

The first podcast, "Managing Your Student Loans," is available now through Apple iTunes store: http://feedthepig.podomatic.com”.

The next four episodes include:  

• Buying Your First Home
• Paying Down Debt vs. Saving for the Future
• Filing Your Taxes
• Compulsive Spending

A new podcast will be available every 10 days.

According to an AICPA-commissioned study, the median net worth of Americans 25 to 34 years of age is significantly lower than it was 20 years ago, despite increases in income: In 1985, it was $6,788; in 2004, it was $3,746. In addition, there is an increased willingness among Americans in this age group to acquire unsecured debt: The average level of debt in 1985 was $3,118, whereas in 2004, it climbed to $4,733.

Bob Jensen's personal finance helpers are at http://www.trinity.edu/rjensen/Bookbob1.htm#Finance

2007 International Accounting Standards

From IASPlus on March 13, 2007

March 2007: 2007 IFRS Bound Volume is published     The International Accounting Standards Board has published the 2007 Bound Volume of International Financial Reporting Standards. This bound volume includes all IFRSs, International Accounting Standards (IASs), IFRIC and SIC Interpretations, and IASB-issued supporting documents, including application guidance, illustrative examples, implementation guidance, bases for conclusions, and dissenting opinions approved at 1 January 2007. IFRS Bound Volume 2007 (English, ISBN: 978-1-905590-26-1) may be ordered from The IASB Website. The price is £60 plus shipping. Discounts apply to low and middle income countries and orders for more than 10 copies. Translations into other languages will be published soon. Press Release (PDF 42k).

On February 28, 2007 Deloitte published the popular IFRS versus U.S. GAAP Guide

Deloitte's IFRS Global Office has published a new Comparison of International Financial Reporting Standards and United States GAAP (PDF 208k, 36 pages) as of 28 February 2007. While this comparison is comprehensive, it does not attempt to capture all of the differences that exist or that may be material to a particular entity's financial statements. Our focus is on differences that are commonly found in practice. The significance of the differences enumerated in this publication – and others not included – will vary with respect to individual entities depending on such factors as the nature of the entity's operations, the industry in which it operates, and the accounting policy choices it has made. We are pleased to grant permission for accounting educators and students to make copies for educational purposes.

 

Main News Site for International Accounting Happenings --- http://www.iasplus.com/index.htm 

KEY GROUPS

EFRAG

Europe

IFAC

IOSCO

US FASB

US SEC

US PCAOB

RESOURCES Past News by Month Reference Materials Statistics Database IFRS in Europe by 2005 UK Web-based IFRS Updates Country/Region Use of IFRSs IAASB Auditing Standards Public Sector Standards

TOOLS 11-Year Calendar Currency Converter Loan Amortisation News Headlines Stock Market Indexes Telephone Codes Unit Conversions World Electric Guide World Phone Guide World Time Clock Worldwide Weather

DELOITTE'S IASPLUS WEBSITE About IASPlus Terms for Use Privacy Policy Abbreviations IAS Plus Spanish IAS Plus German

Paul Pacter and Deloitte provide a statistical database (with data about international accounting) at http://www.iasplus.com/stats/stats.htm

International Financial Reporting Standards (IFRS) Summary --- http://www.iasplus.com/standard/standard.htm

Use of IFRS varies by nation --- http://www.iasplus.com/country/useias.htm 

If you click on the Search tab and enter something like (IFRS AND China) to compare IFRS with the domestic standards of a given nation --- http://www.iasplus.com/index.htm

Bob Jensen's threads on accounting theory are at
http://www.trinity.edu/rjensen//theory/00overview/theory01.htm

Vote for the Accounting Horizons' Best Paper Award
March 13, 2007 message from peggy@aaahq.org

Dear Accounting Horizons Subscriber:

The American Accounting Association announces the Accounting Horizons Best Paper Award. The award is presented annually for the best paper published each calendar year in Horizons. All papers appearing in Horizons in 2006, except for editorials written by the editor and committee reports, are eligible. The winner will be announced in the Accounting Education News. The award, a plaque and $2,500 funded by McGraw Hill, will be presented at the 2007 AAA Annual Meeting.

The award winner will be selected by online voting that is open to all Horizons subscribing members of the AAA.

DEADLINE to submit your ballot is midnight (EDT) on April 30, 2007.

Following is the link to the online ballot --- Click Here

Thanks for your participation,

iGAAP (International GAAP) 2007 Financial Instruments: IAS 32, IAS 39 and IFRS 7 Explained (Third Edition)
Deloitte & Touche LLP (United Kingdom) has developed iGAAP 2007 Financial Instruments: IAS 32, IAS 39 and IFRS 7 Explained (Third Edition), which has been published by CCH. This publication is the authoritative guide for financial instruments accounting under IFRSs. The 2007 edition expands last year's edition with further interpretations, examples, discussions from the IASB and the IFRIC, updates on comparisons of IFRSs with US GAAP for financial instruments, as well as a new chapter on IFRS 7 Financial Instruments Disclosures including illustrative disclosures. iGAAP 2007 Financial Instruments: IAS 32, IAS 39 and IFRS 7 Explained (628 pages, March 2007) can be purchased through CCH Online or by phone at +44 (0) 870 777 2906 or by email: customer.services@cch.co.uk .
IAS Plus, March 24, 2007 --- http://www.iasplus.com/index.htm

Bob Jensen's threads on the differences between U.S. and International GAAP are at http://www.trinity.edu/rjensen//theory/00overview/theory01.htm#FASBvsIASB

Bob Jensen's tutorials on IAS 39 (Derivative Financial Instruments) are linked at http://www.trinity.edu/rjensen/caseans/000index.htm

Question
Why don't we begin to integrate IFRS-SFAS differences into intermediate and advanced accounting textbooks?

March 25, 2007 message from Denny Beresfo [DBeresfo@TERRY.UGA.EDU]

Here's a link to an interesting speech by the head of the Division of Corporation Finance at the SEC on international accounting and the possibility that it may be used by U.S. companies too - http://www.sec.gov/news/speech/2007/spch032307jww.htm 

Note his words that, "For example, I was surprised to learn that colleges in the U.S. do not today generally teach IFRS to accounting students. So, while we might allow U.S. companies to report in IFRS, there would seem to be a large learning curve before there would be sufficient accountants to prepare those financial statements, or to audit them for that matter. All the same, I feel that U.S. issuers reporting in IFRS, like ending reconciliation, is an end we can see. We just need to figure out how to get there."

Denny Beresford

March 26, 2007 reply from Bob Jensen

Hi Denny,

I suspect we don't teach IFRS in the U.S. because IFRS is not on the CPA examination and, therefore, is not generally included in intermediate and advanced accounting textbooks. Given the progress being made to eliminate SFAS domestic standards with a greatly expanded IFRS, it is probably time to begin to integrate IFRS into our U.S. textbooks.

I suggest that one place to begin is for our textbooks to have a section at the end of each textbook chapter highlighting the differences between SFAS versus IFRS standards. Links to such differences are provided at http://www.trinity.edu/rjensen//theory/00overview/theory01.htm#FASBvsIASB

Bob Jensen

March 26, 2007 reply from John Brozovsky [jbrozovs@vt.edu]

Hi Bob:

At Virginia Tech we have already moved IFRS down into Intermediate Accounting (of course this is our first year at it). I am not sure how much is really being incorporated as the instructors generally do not know much about IFRS and the textbooks do not give it much coverage so coverage must all be supplemental to the book. We did hand out Deloittes IFRSs in your Pocket 2006 and PWC's Similarities and Differences A comparison of IFRS and US GAAP.

John

March 27, 2007 reply from Linda Kidwell, University of Wyoming [lkidwell@UWYO.EDU]

This has been a pet peeve of mine for years. I've changed my auditing text for next year to the Knechel book, which finally gives the international auditing standards and the IFAC Code of Ethics (a fabulous document, in my opinion) their due. I was very pleased to see that this text had really raised the visibility of international professional standards.

By the way, one reason the intermediate textbooks really should increase their international content is that the American books are widely adopted outside of the US. Some of the other English language countries have insufficient markets to support their own texts, and universities everywhere that have English language business classes would be well served by more options as well.

Linda Kidwell

Facebook for Student Recruiting

March 5, 2007 message from Barry Rice [BRice@LOYOLA.EDU]

I have suggested to my Accounting Department colleagues that Loyola should consider using Facebook as a tool to help recruit accounting majors. Perhaps we could set up a group called "Accounting as a Major" or "Why Major in Accounting?" or whatever. Facebook has a tool called "Create Related Event" that could be use to publicize meetings, etc. Have any of you looked into using Facebook in this way? Anyone using it for Beta Alpha Psi?

Barry Rice AECM Founder

E. Barry Rice, MBA, CPA
Director, Instructional Services
Emeritus Accounting Professor
Loyola College in Maryland
BRice@Loyola.edu  410-617-2478 www.barryrice.com 

Facebook me! http://www.facebook.com/p/Barry_Rice/20102311

Bob Jensen's threads on careers are at http://www.trinity.edu/rjensen/Bookbob1.htm#careers

"Microsoft Launches  MySpace for Accountants," AccountingWeb, March 15, 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=103287

Microsoft has announced its plans to launch an online community site for financial professionals, similar to the popular MySpace networking site.

Calling it a “MySpace for financial pros,” Microsoft has yet to give the Dynamics Live Beta Community site a more marketable name.

The site will be aimed at corporate controllers, finance managers, finance staff and accountants and includes blogs, forums, tagging, RSS syndication and other community-specific features.

The news follows Reuters’ recent announcement that, it too, will launch a “MySpace for Finance” in the near future.

The software giant made the announcement at its Convergence 2007 conference in San Diego as a way to help its Dynamics Live Beta Community better connect with their external communities of customers, suppliers and partners.

"You can think of it as the MySpace for financial professionals," said Satya Nadella, corporate vice president of Microsoft Business Solutions group. "It's how you can have a Convergence [show] 365 days a year."

In talking to customers, one of their main reasons for attending the Convergence show is to engage with their peers, said James Utzschneider, general manager of Dynamics marketing at Microsoft.

The vendor has been spending a lot of time recently looking at the Web 2.0 world to discover how the social-networking technology mostly aimed at teenagers could be applied to a business setting, he added.

March 3, 2007 message from mmbemap@jofda.com

Dear Bob,
I would like to inform you that the Journal of Derivatives Accounting (JDA) has a new website at www.jofda.com 

The JDA is published quarterly since 2004 and focuses on derivatives accounting standards, applicable tax rules, regulations and also market and corporate practices.

Papers are welcome for the next issue which with structured products (see call for papers).

I look forward do receiving your papers.

Bob Jensen's tutorials on accounting for derivatives are at http://www.trinity.edu/rjensen/caseans/000index.htm

How to Track Commodities and Hedging Derivatives Values

March 27, 2007 message of a controller of a foreign company that lists on the NYSE and therefore must follow FAS 133 rules

Robert,

Many thanks for the quick response and the link to your presentations! They are wonderful.

To show you what I wanted to say concerning "derivatives" and the connection to the "purchasing department" I want to make the following example:

The Purchasing department wants to buy raw material and energy. As they believe prices for this kind of raw material and energy will rise in the future, they decide to close a raw material derivative and a energy derivative deal with a fixed price for the next 12 months. These deals must be reported as soon as possible to the Accounting department to enable them to show the results of these deals in their books according to FAS133.

My question now is the following: Is there a general process (like any standard forms to fill out by the purchasing department and sent to Accounting,...) of how the purchasing department reports such kind of deals to the Accounting department? How should the purchase department report changes in fair value to Accounting?

Many thanks for your help!

March 27, 2007 reply from Bob Jensen

Now I understand. I was thinking more in terms of interest rate hedging.

I have consulted previously with a commodities broker that sells software for tracking commodities values and hedging derivatives values. The software is not free, but it is relatively easy to use. The Company is called RJ Obrien --- http://www.rjobrien.com/corp/index.php 

Customers can not only track values at the RJ Obrien Website, they can obtain software that will download these values automatically. Both your purchasing department and your accounting department can share the trading book downloads.

One problem in derivative instruments for commodities is that the derivatives such as options are really traded in separate markets relative to the commodities themselves. In other words, commodities users buy commodities but buyers of commodity derivatives are often (not always) speculators who have no intention of ever taking delivery of a commodity.

Hence commodities derivatives markets are often more volatile than commodities markets themselves. This makes many derivative hedges ineffective from the standpoint of qualifying for full hedge accounting under IAS 39 or FAS 133. Of all the complicated rules under FAS 133, the rules for options are now the most hated rules due to difficulties of meeting effectiveness tests. Scroll down to the term "Ineffectiveness" at http://www.trinity.edu/rjensen/acct5341/speakers/133glosf.htm#I-Terms 

Also see my PowerPoint file on options at http://www.cs.trinity.edu/~rjensen/Calgary/CD/JensenPowerPoint/ 

Bob Jensen

Bob Jensen's tutorials on FAS 133 and IAS 39 rules can be found at http://www.trinity.edu/rjensen/caseans/000index.htm

CEO Resigns Under Backdating Cloud
Cirrus Logic, a maker of audio and video chips, announced that David D. French has resigned as president and chief executive officer and as a director after an internal review determined that he was aware of possible backdating of stock option grants.
Stephen Taub and Dave Cook, "CEO Resigns Under Backdating Cloud," CFO Magazine, March 9, 2007 --- http://www.cfo.com/article.cfm/8832837/c_8834654?f=ThisWeekInFinance030907

Bob Jensen's threads on stock option accounting are at http://www.trinity.edu/rjensen/theory/sfas123/jensen01.htm

From The Wall Street Journal Accounting Weekly Review on March 30, 2007

Bob Jensen's threads on audit firm professionalism and independence are at
http://www.trinity.edu/rjensen/fraud001.htm#Professionalism

Bob Jensen's threads on Ernst & Young are at
http://www.trinity.edu/rjensen/Fraud001.htm#Ernst

From The Wall Street Journal Accounting Weekly Review on March 30, 2007

Bob Jensen's threads on accounting standard setting are at http://www.trinity.edu/rjensen//theory/00overview/theory01.htm

Second Life for Accountants

March 20, 2007 Message from Barry Rice [brice@LOYOLA.EDU]

To learn how our profession is beginning to use Second Life, go to www.cpasuccess.com and search for "Speaking of generations: Do you Web 2.0 and have a Second Life?" This is a blog site created by the Maryland Association of CPAs. The rest of this post is copied from a blog by Tom Hood, my former student and Executive Director/CEO of the MACPA.

[Begin Quote:]

Later the same day, we heard a session on "Podcasting: What it means to CPE" by Ray Schroeder, director of Technology-Enhanced Learning for the University of Illinois at Springfield. Ray's presentation included some great looks at how higher education is positioning itself to reach the "net generation." He talked about various formats and constant access. He posts all of his lectures as podcasts, posts PowerPoints online so students have 24/7 access to all of the learning. I see some real changes for us in the CPE business!

While his focus was podcasting, his presentation was really about Web 2.0 technologies as he covered blogs, wikis, podcasts, video podcasts and other social media -- like Second Life. Ray said the U of Illinois is in the process of building virtual classrooms in Second Life that will be hosting classes by the fall of 2007. He closed with a statement: "If you are teaching to the students who are graduating in the next few years, you had better have a working knowledge of Second Life, because they will be using that platform."

Wow, I am glad we are beginning to explore Second Life!

Later that evening, there was a lot of discussion about Second Life and how it could be used to tap into the next generation of college students that all CPAs are interested in. I hope to be meeting many of the attendees in Second Life real soon.

For more on how we are using Second Life, see my posts at:

CPA road show debuts in Second Life

Second Life Association of CPAs

SLACPA Debuts in Second Life for next generation of CPAs First CPA firm in Second Life [End quote]

Barry Rice
AECM Founder

March 20, 2007 reply from Steven Hornik [shornik@BUS.UCF.EDU]

Barry,

Thanks for the post. I've been in Second Life since October, exploring and trying to understand it's use as a learning platform. Needless to say for the next generation of students it will be a very important learning platform, though whether this will be SL or some other 3D immersive environment we'll have to see.

I've begun building some 3D model's for my Financial Accounting class, right now I'm just trying to get some basic stuff working, a model of A = L + E, that students can touch and play with and I'd eventually like to make a 3-D financial statement that would pull in data (mabye XBRL data) from the web into SL (I'm dreaming...).

Anyway, if anybody else on this list is in or is considering checking out Second Life let me know, I could use the company. My avatar name in second life is Robins Hermano, send me an IM if your in-world.

Lastly, for those interested in investigating Second Life for Eduation, a great resource is the Second Life Educators (SLED) listserve, which you can sign up for here:

https://lists.secondlife.com/cgi-bin/mailman/listinfo/educators 

Dr. Steven Hornik
University of Central Florida
College of Business Administration

 

Search for Accounting Software

March 21, 2007 message from

Anyone have any good ideas/experience with POS software for a start up restaurant/catering establishment?

Looking for ideas to investigate.

Thanks

Suzann D Medicus CPA
Chief Executive Officer
SDM Consulting Group Inc
dba Liberty Tax 3418
offices in Catonsville, Arbutus and Ellicott City
Corporate headquarters in Clarksville

March 21, 2007 reply from Bob Jensen

You might search for various kinds of accounting software at http://www.findaccountingsoftware.com/ 

Bob Jensen’s software helpers are at http://www.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware

Bob Jensen

Statistical Sampling for Auditors

March 19, 2007 message from Linda Kidwell, University of Wyoming [lkidwell@UWYO.EDU]

Does anyone know of a good tutorial on statistical sampling in auditing? This is absolutely my least favorite topic to teach, and I'm never satisfied with how I go about it. I loved stats as a graduate student, but I simply don't know how to teach it in an interesting and effective way.

Thanks for any suggestions!

March 21, 2007 reply from Bob Jensen

Hi Linda,

AuditNet provides resources for statistical sampling at http://www.auditnet.org/sampling.htm 

I did a literature search at http://scholar.google.com/advanced_scholar_search?hl=en&lr= 
Most of the hits are from the 1980s and early 1990s. It appears that there is not much in the way of current literature on this topic except as you might find in revised chapters of auditing textbooks.

You might take particular note of "Statistical Sampling Revisited," by Neal B. Hitzig, CPA Journal, 2004 --- http://www.nysscpa.org/cpajournal/2004/504/essentials/p30.htm 

Bob Jensen

May 22, 2007 reply from Barbara Scofield [scofield@gsm.udallas.edu]

For current research in audit sampling as well as extensive links, see Will Yancey's work at http://wwww.willyancey.com  He is a colleague of mine from the doctoral program at UT Austin who has his own consulting practice in which he designs (and defends in court) sampling plans for clients.

Barbara W. Scofield
Associate Professor of Accounting
University of Dallas Irving, TX 75062
scofield@gsm.udallas 

 

America's Most Trustworthy Companies
The Good Bookkeepers

Forwarded by David Albrecht [albrecht@PROFALBRECHT.COM]

http://www.forbes.com/2007/03/26/companies-accounting-governance-lead-cx_pm_0327trustyintro.html?partner=daily_newsletter


America's Most Trustworthy Companies
The Good Bookkeepers
Forbes.com staff 03.27.07, 6:00 AM ET

Alexander the Great is reputed to have said, "Upon the conduct of each depends the fate of all."

More than two millennia on, the words of the Macedonian king echo true in the boardrooms of America, where the tainted winds of option backdating, insider trading and questionable pension accounting blow fitfully--along with the occasional gust still from the Enron-era corporate scandals.

Trust in free-market capitalism requires that shareholders and other stakeholders in the system have confidence in the probity of companies. Hence accounting standards and governance rules, and the regulators' requirement that they be transparent.

In Pictures: The 10 Most Trustworthy U.S. Companies


Full List: 100 Most Trustworthy U.S. Companies

Audit Integrity, an independent Los Angeles firm that does research on corporate governance best practice (and which is a data supplier to Forbes.com), has drawn up its first list of 100 American companies that, in its judgment, "showed the highest degree of accounting transparency and fair dealing to stake-holders during 2006."

Using financial and nonfinancial measures designed originally to monitor the factors associated with fraud or financial misrepresentation, Audit Integrity constructs an Accounting and Governance Risk score for each company. Full details of the methodology can be found here.

At the top of its list is AllianceBernstein Holding, a New York asset management company, followed by Bemis, a Neenah, Wis.-based manufacturer of flexible packaging and containers for industries ranging from food to pharmaceuticals, and CDI, a Philadelphia company that provides information technology outsourcing services.


Continued in article at: 
http://www.forbes.com/2007/03/26/companies-accounting-governance-lead-cx_pm_0327trustyintro.html?partner=daily_newsletter

LSU Forensic Accounting Program
March 12, 2007 message from Larry Crumbley [dcrumbl@lsu.edu]

For your information (see attached; can also be found at http://www.bus.lsu.edu/accounting/faculty/lcrumbley/lsu_forensic_accounting.htm ).

From The Wall Street Journal Accounting Weekly Review on March 2, 2007

"KPMG Germany's Failure to Spot Siemens Problems Raises Questions" by Mike Esterl, David Crawford, and David Reilly, The Wall Street Journal, Feb 24, 2007, Page: B3 ---
Click here to view the full article on WSJ.com
 

TOPICS: Audit Quality, Auditing

SUMMARY: "German prosecutors say they suspect Siemens employees funneled money through sham consulting contracts into slush funds to bribe potential customers." Part of the evidence may indicate that KPMG failed to investigate questionable items uncovered by a junior auditor. This possibility was documented in statements made by a former executive financial officer of Siemen's telecom equipment unit while imprisoned subsequent to a German police raid of the company's offices. The executive has been released after agreeing to cooperate with authorities and remains a suspect. KPMG Germany has not been charged and has denied any wrongdoing in its auditing practices.

QUESTIONS:
1.) "Despite...alarm bells, KPMG Germany signed off on Siemens's books and the adequacy of its internal controls..." What are the "alarm bells" described in the article that authorities are now saying should have brought potentially fraudulent payments to the attention of Siemens's auditors, KPMG Germany?

2.) What is an auditor's responsibility to detect fraud?

3.) In general, what are an auditor's responsibilities in reporting on a company's internal controls? To verify the types of reports issued, you may examine the Siemens 2005 financial statements filed with the SEC on Form 20-F and referred to in the article http://www.sec.gov/Archives/edgar/data/1135644/000132693205000152/f01125e20vf.htm 

4.) Given that "Siemens, with KPMG Germany's help, identified...($551.8 million) in suspicious transactions spanning seven years and restated its financial results in December," is it possible that KPMG Germany fulfilled its audit obligations identified above? Explain.

5.) What makes it likely that a junior auditor would be the one to uncover questionable practices at a large company? How does a staff auditor's inexperience make it difficult for him or her to exercise judgment on matters examined in an audit?

SMALL GROUP ASSIGNMENT: Allow students to form small groups of two or three. Provide each student with the following statement: Suppose that you are the junior auditor who raised questions about the payments made by Siemens for consulting services, now alleged to be fraudulently reported to cover payments for bribes. Suppose further that you observe that your management letter comment about the matter was removed in "partner review", but that you were convinced there were potentially improper payments you had not investigated during your audit field work. What should you do? Discuss all possible courses of action.

Bob Jensen's threads on KPMG are at http://www.trinity.edu/rjensen/Fraud001.htm#KPMG

Bob Jensen's threads on audit professionalism and independence are at http://www.trinity.edu/rjensen/fraud001.htm#Professionalism

1,420 Restatements of Corporate Financial Statements in 2006 Sets a Dubious New Record

Almost 10% of U.S. public companies announced a record 1,420 financial restatements in 2006. It was a record -- but continues an accelerating trend of financial restatements, from 2% in 2000 and more than 4% in 2004.

These restatements impose large costs on the capital markets. The GAO estimated that, between July 2002 and September 2005, the market capitalizations of restating companies decreased by a total of $36 billion in the days immediately following the initial restatement. Two academic studies have shown that stock prices decline not only for the restating firm but also for its direct competitors -- presumably because of fears about the financials of the whole industry. More broadly, as the SEC has noted: "Restating financial statements of prior periods may dilute public confidence in financial statements and may confuse those who use them."

The initial spurt of restatements during 2002 to 2004 was related partly to the more intensive reviews of internal controls mandated by Section 404 of the Sarbanes-Oxley Act. However, Sarbox is not the main problem. From 2005 to 2006, there was a 14% decrease in the number of financial restatements by the larger public companies required to perform internal control reviews under Section 404, according to a Glass Lewis study. Yet for the same period, that study found a 40% increase in the number of financial restatements by smaller public companies not yet required to implement Section 404.

The main problem is that many public companies are being forced to restate their financials for technical accounting reasons of dubious significance to investors. On March 12, 2007, for example, a Nasdaq company called Isle of Capri Casinos announced a delay in filing its SEC reports to complete the restatement of its financials for the prior three years because of adjustments to the amortization of its space leases.

Yet, Standard & Poor's concluded that "we do not believe the issue causing the restatement and the filing delay to be material." No wonder ordinary investors are confused: how should they react to a financial restatement caused by an accounting adjustment to a non-cash item, which is declared immaterial by an expert firm?

To be sure, some financial restatements are certainly justified, most importantly those resulting from the negligent or intentional misapplication of well-established accounting standards. Nevertheless, others are the result of significant reinterpretations of complex accounting standards that could not realistically have been foreseen by company executives.

While such reinterpretations may be an appropriate response to changing markets or new accounting perspectives, they should be adopted only with advance notice by the regulators together with an opportunity for public comment. Moreover, significant reinterpretations of accounting standards should be applied prospectively, not retroactively, to reduce the number of unnecessary financial restatements that damage companies and confuse investors.

The adoption and amendment of U.S. accounting standards occurs through a formal process led by the Financial Accounting Standards Board. This process, which often takes several years, involves the promulgation of a detailed draft, a lengthy period for public comment and careful decision-making by a board of distinguished members. By contrast, significant changes in interpreting existing accounting standards have episodically been announced through speeches or informal communications by the SEC staff -- without any advance notice or public comment.

"Small Companies Lead Pack of Restatements," AccountingWeb, January 2, 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=102960

Smaller companies more often restated their financial results through the third quarter of 2006 than the largest companies, a financial research firm has found. Glass, Lewis & Company, which tracks the number of restatements by U.S. companies, said companies with market capitalizations of less than $75 million filed the most restatements in the first nine months of 2006, compared with the same period in 2005. Overall, the number of restatements rose 12 percent to 1,063, compared with 952 in the 2005 period, the report said.

The San Francisco-based firm says that larger companies – with market capitalizations of $750 million or more – had fewer restatements.

Glass, Lewis & Company points to Sarbanes-Oxley as the reason for the disparity, the New York Times reported. Big companies were required to enact the strict financial controls under Section 404 earlier so their balance sheets are cleaner. Smaller companies haven’t yet made the changes that could prevent errors in financial statements because the deadline has been extended.

"Simply put, micro-cap companies haven't yet had to comply with SOX 404," Glass Lewis researchers wrote in the report. "As such, their lax internal controls, which remain untested by independent auditors, continue to produce materially erroneous financial reports."

Scott A. Taub, the acting chief accountant of the Securities and Exchange Commission, commented on the large number of restatements (1,195 in all of 2005) in a Nov. 17 speech. “Some suggest the large number of restatements shows that an overly conservative attitude pervades, resulting in restatements for errors that simply are not material," he said. "Others believe that the large number of restatements shows that the reforms of recent years are working, causing companies to look harder at financial reporting and correct errors that arose in earlier years. Others argue that the rise in restatements can be traced to the increased complexity of accounting standards and reporting rules.”

Taub said that his staff informally reviewed restatements from 2003 to 2005 to see what companies were saying about the errors. He said that well over half of the errors were caused by “ordinary books and records deficiencies or by simple misapplications of the accounting standards.”

Stock options backdating probes triggered some of the restatements last year, Reuters reported.

Through the first nine months of 2006, 14 companies had filed restatements related to the timing of stock option grants. By December, 84 companies had announced they would need to restate financials to correct accounting for prior stock option grant awards, the Glass Lewis report said.

"The SEC's Fuzzy Math," by Robert C. Pozen, The Wall Street Journal, March 23, 2007; Page A11 ---
http://online.wsj.com/article/SB117461410223846329.html?mod=opinion&ojcontent=otep&

Almost 10% of U.S. public companies announced a record 1,420 financial restatements in 2006. It was a record -- but continues an accelerating trend of financial restatements, from 2% in 2000 and more than 4% in 2004.

These restatements impose large costs on the capital markets. The GAO estimated that, between July 2002 and September 2005, the market capitalizations of restating companies decreased by a total of $36 billion in the days immediately following the initial restatement. Two academic studies have shown that stock prices decline not only for the restating firm but also for its direct competitors -- presumably because of fears about the financials of the whole industry. More broadly, as the SEC has noted: "Restating financial statements of prior periods may dilute public confidence in financial statements and may confuse those who use them."

The initial spurt of restatements during 2002 to 2004 was related partly to the more intensive reviews of internal controls mandated by Section 404 of the Sarbanes-Oxley Act. However, Sarbox is not the main problem. From 2005 to 2006, there was a 14% decrease in the number of financial restatements by the larger public companies required to perform internal control reviews under Section 404, according to a Glass Lewis study. Yet for the same period, that study found a 40% increase in the number of financial restatements by smaller public companies not yet required to implement Section 404.

The main problem is that many public companies are being forced to restate their financials for technical accounting reasons of dubious significance to investors. On March 12, 2007, for example, a Nasdaq company called Isle of Capri Casinos announced a delay in filing its SEC reports to complete the restatement of its financials for the prior three years because of adjustments to the amortization of its space leases.

Yet, Standard & Poor's concluded that "we do not believe the issue causing the restatement and the filing delay to be material." No wonder ordinary investors are confused: how should they react to a financial restatement caused by an accounting adjustment to a non-cash item, which is declared immaterial by an expert firm?

To be sure, some financial restatements are certainly justified, most importantly those resulting from the negligent or intentional misapplication of well-established accounting standards. Nevertheless, others are the result of significant reinterpretations of complex accounting standards that could not realistically have been foreseen by company executives.

While such reinterpretations may be an appropriate response to changing markets or new accounting perspectives, they should be adopted only with advance notice by the regulators together with an opportunity for public comment. Moreover, significant reinterpretations of accounting standards should be applied prospectively, not retroactively, to reduce the number of unnecessary financial restatements that damage companies and confuse investors.

The adoption and amendment of U.S. accounting standards occurs through a formal process led by the Financial Accounting Standards Board. This process, which often takes several years, involves the promulgation of a detailed draft, a lengthy period for public comment and careful decision-making by a board of distinguished members. By contrast, significant changes in interpreting existing accounting standards have episodically been announced through speeches or informal communications by the SEC staff -- without any advance notice or public comment.

Continued in article

A Great Library Price for Electronic Versions of American Accounting Association Research Journals

March 27, 2007 message from Tracey E. Sutherland [mcentire@amigos.org]

You and your students can have desktop access to all 13 of the American Accounting Association's premier scholarly journals which are now available in the AAA's Electronic Journal Package. We encourage you to either forward this email to your librarian asking them to arrange for a trial or reply to this email indicating your interest and we will contact the library on your behalf.

This new package offers the industry's leading collection of journals in accounting that address a wide range of topics including: education, public interest, taxation, auditing, impact on behaviors, technology, systems, legal, international, and management. The AAA's newest section journal, Current Issues in Auditing, is open access, and is also included in this package. http://aaahq.org/pubs/JournalSubRates.htm

Key features of the package include:

* The most current issues as they are published

* Full text coverage of the AAA publications from 2000+

* Dynamic hyperlink citation cross-referencing

* Effective search capability, including title, author, key word, and other parameters

* MyAlerts and RSS automated journal update notifications

A one year discounted package subscription rate of $1,200 includes perpetual access via Portico at a savings of $ 945 (List price $2145). Print subscriptions to any combination of the 1-10 AAA journals that are available in print can be acquired for an additional $120. Amigos Library Services handles sales of the AAA Electronic Journal Package in the United States and Canada and librarians should contact Gerrye McEntire mcentire@amigos.org  for orders and trials.

Providing access long term to the AAA journals insures you and your students continued access to the best literature in accounting.

Best regards,

Tracey Sutherland

Studying Cost Structures, Sales Mix, and the Competition

From The Wall Street Journal Accounting Weekly Review on March 23, 2007

March 2007 Updates on the Sad State of Accounting Research in Academe --- http://www.trinity.edu/rjensen//theory/00overview/theory01.htm#AcademicsVersusProfession

Nearly two years ago I sent out an "Appeal" for accounting educators, researchers, and practitioners to actively support what I call The Accounting Review (TAR) Diversity Initiative as initiated by last year's American Accounting Association President Judy Rayburn --- http://www.trinity.edu/rjensen/395wpTAR/Web/TAR.htm

In it I noted that a bright ray of hope for changing narrow focus of The Accounting Review (TAR) was the appointment of Bill McCarthy as Associate Editor for purposes of introducing Accounting Information Systems research into TAR.

I now have an expanded paper written in partnership with Jean Heck --- http://www.trinity.edu/rjensen/395wpTAR\03MainDocumentMar2007.htm
The MS Word version is at http://www.trinity.edu/rjensen/395wpTAR\395wp.doc
This paper is forthcoming in the December 2007 edition of the Accounting Historians Journal

March 27, 2007 message from McCarthy, William [mccarthy@BUS.MSU.EDU]

This thread and other AECM posts regarding information technology research in accounting casts a grim picture for people who wish to do computer science related work aimed at the major accounting academic journals. This has been an "us vs. them" problem for most of my 30 years in AIS research.

While it is indeed true that JAR, JAE, and the other private accounting journals remain in the Stone Age as far as accounting technology issues are concerned, there have been significant steps taken by TAR to open up the main AAA journal to this kind of work. Dan Dhaliwal appointed me as an editor with the express purpose of having a person knowledgeable in information systems and computer science research methods available to the AIS research community for manuscript review and decision-making.

Surprisingly, as I have outlined at both the sectional and national AAA meetings, the problem has not been as much with "them" as it has been with "us," at least in the last 15 months or so. Quite simply, the number of AIS submissions to TAR has been alarmingly low. In Washington last August, I set a target of 12-18 for the AIS community for this academic year, a number I thought was modest and achievable. However, it does not look like we will come close to that at our present rate.

*

As I mentioned in Washington, the submission procedure is this:

*

Do the work and make sure it is rigorous according to accounting, IS, and/or computer science standards,

*

Submit the paper and note or show that it deals with an important accounting issue issue by using AIS, MIS or CS methods, and

*

Ask that the paper be assigned to me as the editor most familiar with IS and CS methods.

If you make a convincing case on these points and if the senior editor thinks it is high quality, then I get it, I assign the referees, and I get to make the consolidated judgment.

Paraphrasing the famous Canadian hockey player Wayne Gretzky, the AIS research and the accounting practice communities will miss on 100% of the good ideas that never get submitted to TAR. If we want change the face of accounting research, the time for action is now. Do the work and submit "that" paper. Additionally, send your name off to me as a possible referee, outlining your particular expertise in either methods or specific technologies.

Bill McCarthy,
Michigan State University

mccarthy@bus.msu.edu 
http://www.msu.edu/user/mccarth4 <https://mercury.bus.msu.edu/exchweb/bin/redir.asp?URL=http://www.msu.edu/user/mccarth4>

March 27, 2007 reply from Paul Williams [Paul_Williams@NCSU.EDU]

Bill,

What we may be paying as the price for dragging doctoral education in accounting back to the Stone Age about 40 years ago, is the phenomenon you describe. People have become so disenchanted with TAR that they have found other more comfortable venues for pursuing their work. In spite of public declarations about the new openness, we have heard this before only to have it turn out to be disengenuous PR. I think your appeal here might encourage people to trust you once and submit a paper, BUT it better produce some postitive experiences.

Another issue is "rigor." Everything must be RIGOROUS, but most GOOD IDEAS aren't "rigorous". They are typically fraught with error, but they open new vistas and ways of thinking about things. The history of science is filled with tales of earth changing ideas that were not offered in a RIGOROUS way (we know Mendel fudged his data on sweet peas, so did Milliken and Keynes General Theory... was notoriously cobbled together). We have become so fixated on method and our public appearance as rigorous scientists that all accounting scholarship in the U.S. at least follows the same template. Our idea of rigor is, frankly, naïve, based more on appearance than substance. Robert Heilbroner once remarked that "Mathematics brought great rigor to economics.

Unfortunately it also brought mortis." Bill, you now have some power (?). Take some chances. What is the point of an academic discourse confined only to statistical model building where, simultaneously, replication is emphatically discouraged? Empirical rigor means doing it over and over by independent investigators with rigorous controls. We may not even be doing what we currently do "rigorously."

March 27, 2007 reply from J. S. Gangolly [gangolly@CSC.ALBANY.EDU]

Methodological hangups, fetish about quantitative rigour, phobia about normative research, all have afflicted most disciplines at one time or the other. We in accounting seem to have them all at the same time.

I remembering sitting on a doctoral committee with folks from psychology, and was frightened to discover my own prejudices after hearing a well known (Skinnerian) psychologist fellow committee member asked me to be a bit more understanding of methodologies used by others.

I have found the accounting crowd reward conformity with received wisdom from the self-anointed sages.

Much of my work has been normative, and therefore considered "unsuitable" for publications in better known accounting journals (statement made by editor of one of the top rated accounting journal). I feel driven out of the field years ago into Operations Research, Information Systems, Computing & Information Sciences.

In none of those fields have the journal editors/ referees used any litmus tests. On the other hand, the referees at an AAA section journal, (about 20 years ago) was bold enough to state that my paper was an insult to the excellent work done by others in the field (the paper was later published in a respected journal in IS with few changes; it was the last paper I submitted to any establishment accounting journals).

Bill's message gives me hope in a way I never imagined. As a test balloon, I will submit TAR one of our papers that I had targeted for a CSI journal.

We need a balance between rigour, relevance, and methodological purity. Above all, we need tolerance for work that differs from our own perspective on each of these. We also need a diversity of approaches to the issues in the papers.

Jagdish

Given the dire shortage of accounting doctoral students, there's an explosion in part-time accounting faculty.
This is also the trend in most other disciplines.
"Inexorable March to a Part-Time Faculty," by Doug Lederman, Inside Higher Ed, March 28, 2007 --- http://www.insidehighered.com/news/2007/03/28/faculty

New data from the U.S. Education Department confirm what faculty leaders increasingly bemoan: The full-time, tenure-track faculty member is becoming an endangered species in American higher education.

A new report from the National Center for Education Statistics shows that of the 1,314,506 faculty members at colleges that award federal financial aid in fall 2005, 624,753, or 47.5 percent, were in part-time positions. That represents an increase in number and proportion from 2003, the last full survey of institutions, when 543,137 of the 1,173,556 professors (or 46.3 percent) at degree-granting institutions were part timers. (The statistics may not be directly comparable because the department reported part-time/full-time figures only for degree-granting institutions in 2003, and for all Title IV institutions in 2005.)

The new report, “Employees in Postsecondary Institutions, Fall 2005, and Salaries of Full-Time Instructional Faculty, 2005-06,” also finds the proportion of all professors who are tenured or on the tenure track to be shrinking. Of the 675,624 full-time faculty members at degree-granting colleges and universities in 2005, 414,574, or 61.4 percent, were either tenured or on the tenure track. That is down from the 411,031 of 630,419 (or 65.2 percent) of professors at degree-granting institutions who were tenured or tenure track in 2003.

Full-time Faculty at Degree-Granting Institutions, 2005 and 2003

	Fall 2005	Fall 2003	% Change
All faculty	675,624*	630,419	7.1%
With tenure	283,434	282,429	0.4%
Tenure track	131,140	128,602	1.9%
Not on tenure track/ no tenure system	235,171	219,388	7.2%

*Figure includes 25,879 staff members with faculty status.

The NCES report contains a wealth of other information about faculty and staff members at colleges and universities. Among the other highlights:

• The proportion of full-time faculty members at degree-granting institutions who are women rose slightly, to 40.6 percent in 2005 from 39.4 percent in 2003.
• The proportion of full-time faculty members who are white dropped slightly, to 78.1 percent in 2005 from 80.2 percent in 2003. The biggest gain was among Asian/Pacific Islanders, whose share of the full-time professoriate rose to 7.2 percent from 6.5 percent. The proportion who are black dipped by a tenth of percentage point (from 5.3 percent to 5.2 percent), while the share who are Hispanic rose to 3.4 percent from 3.2 percent.
• Men were significantly more likely to be tenured or tenure track than were women. Of full-time male professors, 47.5 percent were tenured and 18.1 percent were tenure track, while 33.9 percent of women were tenured and 21.3 percent were tenure track.

Bob Jensen's threads on higher education controversies are at
http://www.trinity.edu/rjensen/HigherEdControversies.htm

Bob Jensen's threads on the Obsolete and Dysfunctional System of Tenure: 
Over 62% of Full-Time Faculty Are Off the Tenure Track --- http://www.trinity.edu/rjensen/HigherEdControversies.htm#Tenure

March 28, 2007 reply from Elliot Kamlet [ekamlet@STNY.RR.COM]

I am a low esteem lecturer, albeit full time not part time. Eliminating us is very expensive, especially at a State University like mine. For example, say we hire a brand new PhD at (to use a low but round number) $100,000 per year. (S)he teaches, say, 2 sections per semester at 40 students each. That is a total of 160 students per year or, on average $625 per student. The student takes 8 courses per year for about $4350 in tuition. Therefore there might be a problem growing if we want to pay our professor benefits, turn on the lights, run the buildings, run the administration, etc. Of course our professor will research and publish. While that brings additional recognition to us, it takes a while before it might bring some money. Like it or not, that’s the way it is.

Elliot Kamlet

March 29, 2007 reply from James M. Peters [jpeters@NMHU.EDU]

The problem is far worse in larger state schools. When I was the Department Chair at the U. of Maryland, we would have had to pay $180,000 for a new PhD, including summer support, which pretty much had to be guaranteed as long as they were research active, to teach 3 sections per year. We still couldn’t hire a new PhD because we couldn’t compete for any that had a chance of making tenure at Maryland. The last assistant that was tenured at Maryland was in