Minutes of:

New York State Society of Certified Public Accountants (NYSSCPA) Board of Directors Meeting

Date & Time:

Thursday, December 7, 2006, 9:00 a.m. to 3:30 p.m.

Location:

3 Park Avenue, 19^th Floor, New York, New York

Presiding Officer:

Thomas E. Riley, President

NYSSCPA Board Members Present:

David A. Lifson, President-Elect
Sharon Sabba Fierstein, Vice President
Richard E. Piluso, Vice President
Robert E. Sohr, Vice President
Mark Ellis, Secretary
Neville Grusd, Treasurer
Edward L. Arcara
Thomas P. Casey
Anthony G. Duffy
David Evangelista
Joseph M. Falbo, Jr.
Dr. Myrna M. Fischman
 Phillip E. Goldstein
Scott Hotalen
Don A. Kiamie
Lauren L. Kincaid
Stephen F. Langowski
John J. Lauchert, Jr.

Kevin Leifer
Elliot A. Lesser
Beatrix G. McKane
Mark L. Meinberg
Ian M. Nelson
Jason M. Palmer
Robert A. Pryba, Jr.
Robert T. Quarte
Judith I. Seidman
C. Daniel Stubbs, Jr.
Anthony J. Tanzi
Edward J. Torres
Liren Wei
Ellen L. Williams
Margaret A. Wood
Richard Zerah
Louis Grumet, Executive Director

NYSSCPA Board Members Absent:

Daniel M. Fordham

Howard B. Lorch

Staff Present:

Joanne S. Barry
Adam Cheung
Kevin Hall
Benjamin Kaplan
Mary-Jo Kranacher
Ernest J. Markezin

Dennis O’Leary
William J. Pape
Paul L. Sinegal
Alan Schmelkin
Forrest Whitesides
James A. Woehlke

Guests:

Joseph A. Nuccio, Proskauer Rose
Katharine H. Parker, Proskauer Rose

Phil Westcott*

B0 – E – 0

Call to Order

President Thomas E. Riley called the meeting to order at 9:00 a.m.  He immediately moved into executive session.

B06 – E– 1

Minutes

a.         Approval of Minutes of September 21, 2006, Board of Directors Meeting

Mr. Riley asked Board members if they had any changes or comments to the September 21, 2006, Board of Directors meeting minutes.  There being none, Mr. Sohr moved to approve the minutes as presented, and Mr. Langowski seconded the motion.  The motion passed unanimously.

b.         Highlights of the November 15 and 17, 2006,
            Executive Committee Meetings

For information, Mr. Riley referred Board members to the highlights of the November 15 and 17, 2006, Executive Committee meetings, which were included in the agenda materials.

06 – E – 2
President’s Report

a.         Chapter Town Meetings

Mr. Riley updated the Board on the progress of the Chapter Town Hall Meetings.  He reflected briefly on the fourteen meetings that had occurred to date, noting a similarity of concerns and the free-flowing nature of discussions.  He said that the remaining two chapter meetings would be held in the coming weeks.

b.         State Board Update

Mr. Riley reported that an employee at his firm, who recently sat for the CPA exam, received his exam results from the State Board for Public Accountancy in the form of a numerical grade.  He commended the efforts of the Society in encouraging the State Board to end its practice of only issuing pass / fail results.

Mr. Riley then reported that he had spoken with Daniel Dustin, Executive Secretary of the New York State Board for Public Accountancy, regarding possible ways to enhance courses which meet the state’s ethics CPE requirement through additional case studies and war stories.  He expressed optimism about the meeting.

c.         SET Tax Update

Mr. Riley reported that letters had been sent to United States Congressmen regarding the Society’s SET Tax proposal.  He noted that the staff of Representative Charles Rangel, Chairman of the House Ways and Means Committee, expressed interest in meeting with Society representatives regarding the proposal.

d.         Oversight Committee Update

Mr. Riley noted that, to date, the Executive Committee had met with Society oversight and operations division committee chairs as follows:

·           Frank Aquilino, Chair of the Professional Liability Insurance Committee

·           Suzanne Jensen, Chair of the Audit Committee

·           Stuart Kessler, Chair of the Development of the Profession Division Oversight Committee

·           Don Kiamie, Chair of the Member Benefits Committee

·           Joseph Schlegel, Chair of the Membership Committee

·           Susan Schoenfeld, Chair of the Tax Division Oversight Committee

Mr. Riley stated that all presentations were informative.

e.         Operations Committee Update

Mr. Riley stated that committees within the Society’s operations division were distinguished from other technical committees in that they generally represented the Society on matters of an internal and confidential nature.  He said that, accordingly, more attention should be paid by the Society president in appointments to these committees.  He noted that the Standing Rule on Committee Appointments, passed by the Board in September, would provide guidance to future Society Presidents regarding operations committee appointments.

B06 – E – 3
President-elect’s Report

a.         Quality Enhancement Policy Committee (QEPC)             Update

President-elect Lifson noted that, among other things, the QEPC had planned to thoroughly examine issues relating to CPA education and training in the coming year.  He said, however, that more recently the QEPC had been busy developing both a peer review white paper, endorsed by the Board one year ago, and a white paper on ethics, which would be presented to the Board for consideration later during the meeting.  A discussion of the QEPC white paper on ethics appears below under agenda item B06-E-12. 

b.         2007 Leadership Conference Update

President-elect Lifson reminded Board members that the 2007 Leadership Conference was scheduled to occur from July 8 to 10, 2007, at the Gideon Putnam Resort in Saratoga, New York.  He summarized several working titles for the conference’s theme, including “Closing the Gap between Public Expectations and the Profession’s Experience” and “Narrowing the Expectation Gaps”.  He said that the conference would also include a segment which featured feminist perspectives on today’s workplace, as compared to the workplace of the 1970’s, and a psychologist who would address ways the sexes could work better together.  He noted that a number of ideas for entertainment were being considered as well.  Lastly, Mr. Lifson noted that the Executive Committee recently approved a proposal from the Turning Stone Resort, located in Verona, New York, to host the 2008 and 2009 Society Leadership Conferences.

c.         President-elects Workshop

President-elect Lifson noted that the chapter presidents-elect workshop, which was held on the preceding day, was well-attended and well-received by participants. 

Mr. Lifson said that New York State was close to issuing its 100,000^th CPA license. He summarized an idea to work with the New York State Office of the Professions to identify this person and then recognize him or her with a gift, perhaps free lifetime CPE.

B06 – E – 4
Vice Presidents’ Reports

a.         Chapters Update

Ms. Fierstein and Mr. Piluso gave reports on the latest monthly conference call of chapter presidents held in late November.  Both stated that the call was well-received, but would have benefited from more chapter representation.  Ms. Fierstein encouraged those Board members nominated by their chapters to talk with their respective chapter officers to encourage more participation in the monthly calls. 

Mr. Piluso noted that he had attended the Chapter Presidents-elect workshop held at the Society’s offices the preceding day.  He said that the program was well

planned and that the presidents-elect appeared to be a very dynamic and motivated group.

b.         Recent Society Comments

Mr. Sohr summarized Society comments issued since his last report as follows:

·        Comments submitted to the Securities and Exchange Commission by the NYSSCPA SEC Practice and Auditing Standards and Procedures Committees, chaired respectively by Mitchell Mertz and Robert W. Berliner, regarding Securities and Exchange Commission Concept Release [Release 34-54122; File No. S7-11-06] Concerning Management’s Reports on Internal Control over Financial Reporting; dated September 20, 2006; Principal Drafters: Robert W. Berliner, Anthony Chan, Jonathan Elmi, Steve Lehrer, Lorraine A. Leotta, and Bernard H. Newman;

·        Comments submitted to the AICPA by the NYSSCPA Auditing Standards and Procedures Committee, chaired by Robert W. Berliner, on The Proposed Statement on Standards for Attestation Engagements, Entitled “SSAE Hierarchy”, dated September 20, 2006; Principal Drafters: Robert W. Berliner and Robert N. Waxman;

·        Comment submitted to the AICPA by the NYSSCPA Auditing Standards and Procedures Committee, chaired by Robert W. Berliner, in support of Exposure Draft of Proposed Statement on Auditing Standards, entitled “Omnibus – 2006”, dated September 20, 2006;

·        Comments submitted to the Securities and Exchange Commission by the NYSSCPA SEC Practice Committee, chaired by Mitchell Mertz, regarding Securities and Exchange Commission Proposed Amendment [Release No. 33-8735; File No. S7-03-06] Concerning Executive Compensation Disclosure, dated October 20, 2006; Principal Drafter, Robert Sohr;

·        Comments submitted to the House Ways and Means Committee, U.S. House of Representatives, by the NYSSCPA Auditing Standards and Procedures Committee, chaired by Robert W. Berliner, regarding Tax Technical Corrections Act of 2006 HR6264 – Section 7, Amendment Related to the Jobs and Growth Tax Relief Reconciliation Act of 2003 (Repeal of 15% IC-DISC), dated October 31, 2006; Principal Drafter: Mitchell Sorkin;

·        Comments submitted to the Financial Accounting Standards Board by the NYSSCPA Financial Accounting Standards Committee, chaired by Margaret Wood, regarding Preliminary Views - Conceptual Framework for Financial Reporting: Objectives of Financial Reporting and Qualitative Characteristics of Decision-Useful Financial Reporting Information (File Ref. 1260-001), dated November 13, 2006; Principal Drafters: Robert A. Dyson, Roseanne T. Farley, Sharon S. Fierstein, Fred R. Goldstein, Edward Ichart, Mark Mycio, John J. McEnerney, and Margaret A. Wood; and

·        Comments submitted to the AICPA by the NYSSCPA Professional Ethics Committee, chaired by Francis T. Nusspickel, regarding Exposure Draft - Omnibus Proposal of Professional Ethics Division Interpretations and Rulings dated September 8, 2006: Proposed Deletion of Rulings Under Rule 101, and Proposed Revision to Interpretation 101-3 under Rule 101: Performance of Nonattest Services: Forensic Accounting Services and Tax Compliance Services; dated November 14, 2006; Principal Drafters: Francis T. Nusspickel, Kevin Bandoian, Melvin Crystal, Arthur Riber, P. Gerard Sokolski, and Ernest Smith.

President Riley commended the authors and committees for their outstanding work.

B06 – E – 5
Treasurer’s Report

a.         Financial Statements for five months ending
            October 31, 2006

Mr. Grusd reported on the financial statements for the five months ending October 31, 2006.  Society gross profits were $3,131,290, which was $53,413 ahead of budget and $55,317 ahead of the figure reported for the same period in the prior year.  FAE unrestricted gross profits were $863,810, which was $158,124 under budget but $258,792 more than reported at the same time last year.  Combined NYSSCPA and FAE unrestricted income, less overheads, for the period stood at $490,716 as compared to $294,688 reported for the same period in the previous year.  Overall, net income was under budget by $20,723. 

Mr. Cheung said that current projections indicated FAE would require approximately $100,000 more than an originally budgeted $491,579 contribution from the NYSSCPA, in order for FAE to break even for fiscal year 2007.  Mr. Cheung noted, however, that the success of Investment Partnership Conference was anticipated to contribute heavily to FAE’s bottom line, thus positively impacting the current projection.  He said that staff would continue to monitor FAE projections throughout the year and keep both the FAE and NYSSCPA boards apprised.

Mr. Grusd commented upon the $25,000 in electricity charges reflected in the financial statements.  Because of the high amount, he suggested that Mr. Kiamie assist him in reviewing electricity charges.  Mr. Kiamie agreed to assist in this endeavor.  

Mr. Grusd also noted that the Executive Committee at its November meeting agreed with a recommendation to develop a five-year, long-term financial plan for the organization. 

In response to a question, Mr. Cheung described the budgeting process as it relates to dues receivables and the Membership Department’s collections process.  He noted that last year $300,000 in dues were eventually written off.  He said that in the current year, he adopted a more conservative approach to dues under which he wrote off 5% of the dues at the outset.  He said the actual written-off dues would be more accurately reflected in the December statements.

B06 – E – 6
Secretary’s Report

a.         Committees Update

Mr. Ellis presented the Secretary’s Report.  He said that the role of the Secretary, as the voice of Society committees to the Executive Committee and Board, was becoming more formalized.  He noted that in preparation for his second year as Secretary, he planned to speak with all committee chairs and vice chairs for the coming year.

b.         Nominating Process Report

Secretary Ellis announced the results of the membership vote to determine the members who petitioned to serve on the 2006-2007 NYSSCPA Nominating Committee as follows:

Peter L. Berlant
Michelle A. Cohen
Jo Ann Golden
Elliot L. Hendler

Norman W. Lipshie

Kevin J. McCoy
Francis T. Nusspickel

Barry B. Seidel

Maryanne M. Winters

In addition, he noted that pursuant to the bylaws, Mr. Riley had appointed Mr. Nusspickel to chair the committee. Mr. Ellis reminded the Board that Joseph M. Falbo, Jr. and C. Daniel Stubbs, Jr. would also be serving on the 2006-2007, Nominating Committee as the Board’s designees.  The Nominating Committee was scheduled to meet on January 11, 2007.

Mr. Ellis relayed several of his experiences on a prior Nominating Committee during which he did not personally know a number of the candidates being considered for office or board positions.  He expressed frustration with the experience and noted that others had also experienced similar frustrations.  He suggested that these frustrations might be alleviated if all candidates for office or board membership were required to submit a written statement addressing why they wished to serve and what they hoped to accomplish if elected. Mr. Ellis then moved that the Board approve a Nominating Committee protocol to this effect, and Mr. Stubbs seconded the motion.  After discussion, the motion failed.

B06 – E – 7
Executive Director’s Report

a.         Legislative Update

This matter was deferred.

b.         COAP Update

This matter was deferred.

c.         Member Benefits Update

Board members were referred to the agenda materials for a summary of member benefit program statistics.

d.         19^th Floor Improvements Update

This matter was deferred.

B06 – E – 8
Report from NYSSCPA Representative to AICPA Council

This matter was deferred.

B06 – E – 9
Report from FAE President

Mr. Riley introduced Gail M. Kinsella, President of the Foundation for Accounting Education Inc. (FAE).  Ms. Kinsella provided several highlights from the last meeting of the FAE Board as follows:

• The FAE Curriculum Committee’s efforts resulted in the addition of 100 new FAE courses in areas such as industry, “soft-skill” development, and several technical areas;
• The FAE Board approved recommendations of the FAE Scholarship Committee to award 46 Excellency In Accounting scholarships totaling $115,000;
• The FAE Board was looking at possible changes to New York’s and New Jersey’s inter-state recognition of ethics CPE, which would allow for more flexibility in meeting the ethics requirement across state lines;
• Staffing changes were recently made to strengthen FAE’s in-firm CPE program;
• FAE was looking at additional ways of continuing its support of Society-chapter educational events; and
• Marketing of the 2007 FAE Trade Show was well underway, including plans to combine the show with the Society’s 2007 annual election dinner.

Ms. Kinsella noted that the FAE Trustees also discussed at its last meeting FAE’s financial results through September 30, 2006, which indicated an unfavorable variance of approximately $90,000.  She attributed a large portion of the negative variance to a two-day FAE accounting and auditing update course which did not proceed as planned because of an issue that arose with respect to the course writer/instructor.  She noted that FAE had to engage an outside vendor at an additional cost and offer only a one-day accounting and auditing update, thus impacting course revenues by approximately $40,000.  She said, however, that staff was working on several other projects to help close the variance, including an increased focus on ethics and in-firm CPE, but she cautioned that the results of these initiatives might not bear fruit until after the close of the fiscal year.  She also noted that FAE was continuing to look at its expenses, program marketing, vendors, and the marketing of its conferences and other FAE-owned educational programs to further assess how FAE could close the negative variance.

Ms. Kinsella responded to several inquiries regarding FAE’s Excellency in Accounting Scholarship program about the awards process and campus ambassadorships.  A board member who served as a campus ambassador suggested that the scholarship committee commence the awards process sooner in the year and that communication with ambassadors be improved with respect to notifying them of any awards given at their respective campuses.  Ms. Kinsella thanked the Board member for the suggestions and agreed to pass them along to the scholarship committee.

Mr. Riley thanked Ms. Kinsella for her presentation, and the Board applauded Ms. Kinsella’s efforts as FAE President.

B06 – E – 10
Preliminary Report of the Governance Subcommittee

Mr. Falbo presented the draft committee action plan of the Governance Subcommittee as follows:

Who We Are

The NYSSCPA Governance Subcommittee was created by NYSSCPA Board Standing Rule and is composed of four Society Board members and one FAE Trustee, who serves ex officio, with right to vote.  The Subcommittee is responsible for advising the Board on governance matters and performs specific tasks as assigned to it by the Board, Executive Committee, or the President.

What We Do

The following are some of the responsibilities of the Subcommittee:

·        Advises the Board on governance matters.

·        Monitors the Society’s governance processes and proposes policies and procedures or other governance techniques for improvement.

·        Makes recommendations for leadership development.

·        Plans the new Board member orientation, subject to the supervision of the President serving for the year during which the orientation occurs.

Who Should Join

Membership on the subcommittee is limited to members of the governing bodies of the NYSSCPA and its affiliated education foundation, the Foundation for Accounting Education, Inc.  Members of those Boards interested in service on the Governance Subcommittee should communicate their interest to the Society President.

Ms. Fierstein moved to approve the CAP of the Governance Subcommittee as presented, and Mr. Stubbs seconded the motion.  The motion passed unanimously.

Mr. Falbo then said that actions of the Board and Executive Committee which had continuing effect were not presently organized into an easily accessible structure.  He said the Governance Subcommittee was working with staff to reorganize the current structure, and then presented a proposal for reorganization which would include the following categories:

Proposed Structure for Governance Policies and Related Items

·        Governance Policies/Actions – Introductory

·        Leadership Policies

·        Strategic Policies

·        Operations Policies

·        Board Standing Rules

·        Nominating Committee Protocols

Ms. Cutler moved to approve in concept the proposed structure for governance policies and related items as presented, and Mr. Sohr seconded the motion.  The motion passed unanimously.

Mr. Falbo said that the Governance Subcommittee had developed a working paper regarding the structure of the Society’s audit committee.  He noted the subcommittee would be presenting its recommendations to the Board at a future meeting.

Mr. Falbo then reminded the Board that the Executive Committee at its November meeting discussed campaigning, advertisements and other solicitations in connection with any potential campaign for Society office.  He said that the Executive Committee by consensus agreed that a more formal process should be developed to ensure a fair campaign and election, noting that President Riley assigned to the Governance Subcommittee the development of election campaign guidelines for consideration by the full Board at its December meeting.

Mr. Falbo presented several proposed election protocol concepts to the Board for discussion.  The Board considered campaigning, advertising, membership solicitations via regular mail and by e-mail, timing considerations, and other issues relating to a potential campaign.  The Board also considered several legal issues posed by the concepts.  A number of Board members noted that any campaign protocols would need to respect a fair, open, and equitable process for the candidates and for the members at large.

Mr. Grumet observed that several of the concepts being discussed could only be instituted in the coming years after careful deliberation; however, he requested more concrete guidance from the Board which could be instituted immediately for a potential race in 2007 with respect to candidate editorials in Society publications.  Mr. Stubbs then moved that the following editorial policy be enforced by staff:

• A policy of "equal space - equal placement" for candidates' statements in Society publications (i.e., The Trusted Professional) shall be instituted;

• No letters to the editor regarding or by candidates will be printed regarding the election; and

• Candidates shall be invited to submit a written piece on why they wish to serve in the particular office, to be published in The Trusted Professional

Mr. Falbo seconded the motion. 

During discussion, Mr. Piluso moved to amend the motion by setting a limit on the candidate’s position pieces of “up to 750 words”.  Ms. Cutler seconded the motion to amend.  The motion to amend passed unanimously.  Mr. Riley then restated the motion as amended, and a vote on the amended motion was taken; the amended motion passed unanimously.

B06 – E – 11

Preliminary Report of the Bylaws Task Force

President Riley asked Board members to review the preliminary report of the Bylaws Task Force, which was provided in the agenda materials.  He suggested that any comments or corrections be directed to the Bylaws Task Force chair, John Lauchert.  Action on the preliminary report was then deferred to a later special meeting of the Board to be held at the call of the President.

B06 – E – 12

QEPC’s White Paper on Ethics

Mr. Lifson presented the ethics white paper on behalf of the QEPC, which he chairs.  He summarized the process by which the white paper had been developed, noting the QEPC’s collegial interplay with, and input from, the NYSSCPA Professional Ethics Committee (PEC).  He said that the current form of the white paper represented the culmination of a very thorough review and joint recommendations of the QEPC and PEC for full Board approval.

Mr. Lifson walked the Board through the white paper point by point, during which a number of the more controversial issues were discussed.  These issues included whether a member of the public should be invited to sit on the PEC.  A discussion ensued regarding the “pros” and “cons” of having a public member on the PEC.  Mr. Lifson noted, for example, that the QEPC itself had two non-CPA public members who actively participated in the committee, and that the AICPA also had public members on certain of its committees.  He opined that these public members often brought both fresh and welcomed perspectives to their committees and to the profession. 

Several additional “pros” for the concept were noted as follows:

• prevention of CPA “myopia”
• promote monitoring of the profession
• broaden input into the profession and enhance decision-making
• transparency

Another board member cautioned, however, that because the public members of the PEC would be voting, as opposed to the non-voting, members, the public members needed to be chosen wisely.  A brief discussion ensued about the process to choose public individuals who could contribute to the PEC.  Mr. Lifson reflected upon the qualifications of the public QEPC members, saying that one was a retired businessman and the other an attorney who represented CPAs. 

Several of the “cons” for the concept were discussed as follows:

• concerns about protecting the confidentiality of investigations
• issues relating to policing the conduct of public members who were not subject to NYSSCPA bylaws
• issues relating to non-public members voting on PEC matters affecting members
• the lack of a technical background in public accountancy that public members may require to more effectively conduct investigations or vote on committee matters

Several members suggested that several of the concerns could be handled through contractually obligating PEC public members to conduct prescribed by the Society’s bylaws and through training.  In addition, it was noted that public individuals would be chosen with particular attention to their business backgrounds and their ability to comprehend the work of the CPA profession and ethics.  One Board member expressed full support for the public-member concept, noting that he had dined next to William McKenna, a public member of the AICPA Council, at the Board dinner held the prior evening.  The Board member said that he found Mr. McKenna to be very well informed about the profession and its ethics. 

Mr. Lifson noted that the concerns raised over public members on the PEC seemed to be mitigated by the benefit of receiving their points of view.  Several agreed but questioned whether the State Board would approve of public members on the PEC.  Mr. Lifson responded that he believed the State Board would not object to the concept.

Several minor wording suggestions were then made to the report.  There being no objection to the suggestions, Mr. Nelson moved to approve the QEPC Ethics White Paper as amended, and Ms. Fierstein seconded the motion.  The motion passed unanimously.

B06 – E – 13

Task Force on Examination of the Annual Conference

Mr. Riley introduced Philip G. Westcott, Chair of the Annual Conference Task Force.  Mr. Westcott began by acknowledging the work of the members on the task force: Sharon Sabba Fierstein, Neil Gibgot and Robert Quarte.  He then summarized the process of the task force, including its review of information relating to leadership conferences held since the year 2001, and its review of results from an informal survey of a number of state societies regarding their own respective conferences, if any.  He noted that overall, there was very little consensus among these societies as to the “who, what, where and if” of an annual conference.

Mr. Westcott said that the task force then explored differences between the Society’s old Annual Conference and the Leadership conference.  He noted that the networking opportunities of the Annual Conference were considered more valuable, due to the conference being open to the whole membership; however, he noted that the location of either type of conference was a very important factor in drawing attendees.  In contrast, he said the Leadership Conference was perceived to be restricted to the “leadership” of the Society, and not the general membership.

In sum, Mr. Westcott said that the task force felt the cost to the membership to hold both an Annual Conference and Leadership Conference was unwarranted.  It was also generally agreed that, of the two, the Leadership Conference was perceived to provide more benefit to the Society, and accordingly to the membership.  Mr. Westcott said that the task force therefore did not recommend the reinstitution of an Annual Conference.  He said, however, that certain attributes of the old Annual Conference should be considered for inclusion in the Leadership Conference, as a way to draw more participation of the general membership. Those attributes included offering CPE sessions and additional socializing and networking opportunities (dinners, cocktail parties, golf, etc.).

Mr. Lifson moved to accept the report of the Annual Conference Task Force, and Mr. Piluso seconded the motion.  The motion passed unanimously.  Mr. Lifson thanked Mr. Wescott and the task force for their work, and he agreed to look at incorporating some of the suggestions into the 2007 Leadership Conference.

B06 – E – 14
Society Recommendations to Serve on AICPA Council

President-elect Lifson, who serves as the Selections Subcommittee Chair, summarized the report of the Selections Subcommittee regarding the Society’s recommendations for AICPA Council.  He stated that, per NYSSCPA Standing Rule SR-1, President Riley had appointed a Selections Subcommittee chaired by himself and comprised of Board members Anthony G. Duffy, Edward Arcara, Debbie Cutler and Stephen A. Langowski.  He said that the Selections Subcommittee had three tasks each year including:

1. Recommending Board members for service on the nominating committee;

2. Vetting and recommending individuals to serve on AICPA Council from New York; and

3. Vetting and recommending individuals to serve as FAE Trustees.

With respect to task number two, the Selections Subcommittee identified six individuals which it then grouped into three classes A, B, and C, with Class A being the most highly recommended. Those individuals were as follows:

Class A

• Vincent Love
• Nancy Newman-Limata

Class B

• Phillip E. Goldstein
• Edward Torres

Class C

• Art Dignam
• Elliot Hendler

Mr. Lifson then explained that there were traditionally nine “directly elected” members of AICPA Council from New York, each having three-year terms. He said that each year, the NYSSCPA submitted recommendations to fill the directly elected Council member vacancies opening up the following October. He stated that this year, four vacancies would be opening up in October 2007. In addition to those four, one “Society Representative” on AICPA Council would represent the NYSSCPA for a one-year term. With the four directly elected Council vacancies and the Society representative position, there were a total of five vacancies that need to be filled in 2007. Therefore, a vote was required to determine the Society’s final recommendations to the AICPA Nominating Committee.

Mr. Lifson then reminded the Board that Standing Rule SR-3 reserved one of the three-year Council recommendations specifically for the Society President-elect designee, once he or she was identified by the Society’s Nominating Committee in January.  He noted that the intent was to assure that the president-elect serves on Council through his or her terms as president-elect, president and immediate-past president of the Society.  With respect to the terms of Messrs. Riley and Lifson, the Selections Subcommittee proposed that the terms of Riley and Lifson be extended at least until each has served his respective term as an immediate past president.  He noted, however, that because there was a possibility that the president-elect designee could be a current AICPA Council member (which had occurred in four of the last five years), the Board needed to act as if it were filling all four three-year positions.

Mr. Falbo then moved that Messrs. Lifson and Riley be recommended by the Board for three-year AICPA Council terms, respectively.  Ms. Fischman seconded the motion.   The motion passed.  Ms. Cutler abstained.

On a different note Mr. Lifson noted that AICPA Bylaws provided for the rotation of Council members, and while the New York members of Council did rotate, the process did not occur evenly. He pointed out that in two out of three years, four directly elected Council members were appointed; and in the third year of the cycle, one member was appointed. The AICPA Bylaws provided a mechanism for a state society to request that the terms of the directly elected Council members from its state be adjusted to provide for an even rotation of Council members.  Last year, the NYSSCPA Board and AICPA Nominating Committee put into place an adjustment process.  One of last year’s directly elected Council members received a two-year term which will end in October 2008, rather than the usual three-year term.  If this process were continued this year, one of the directly elected members would receive a one-year term.  Beginning in October 2007, then, the Society would have an even rotation with three “directly elected” Council vacancies occurring each year.

Mr. Lifson then moved to place into nomination the following Selections Subcommittee’s recommendations to the AICPA Nominating Committee to fill two of the three remaining Council vacancies opening up in October 2007, with the third to be filled by the president-elect designee:

            Class A

·         Vincent Love

·         Nancy Newman-Limata

            Class B

·         Phillip E. Goldstein

·         Edward Torres

            Class C

·     Art Dignam

·     Elliot Hendler

Mr. Lifson opened the floor to additional recommendations from the Board. Ms. Cutler moved that Robert Sohr be added to the list, and Mr. Ellis seconded the motion. The motion passed unanimously.

There being no further recommendations, Ms. Fischman then moved to close nominations, and Mr. Lauchert seconded the motion. The motion passed unanimously. President Riley declared nominations closed.

The Board by consensus agreed that because all the candidates except Mr. Sohr had provided the Board with biographical information for consideration, Mr. Sohr should also provide a brief biographical summary.  Mr. Sohr then gave a brief oral summary of his professional accomplishments and Society activities.

The Board then agreed by consensus that the election would be conducted in such a fashion that alternates would be identified in the event the president-elect designee chosen by the NYSSCPA Nominating Committee at its meeting in January is either 1) presently serving on Council with a term expiring after 2006, or 2) is one of the three individuals otherwise recommended for Council service.  In addition, the Board agreed by consensus that the NYSSCPA should request that the AICPA continue to adjust the terms of directly elected members of Council from New York so as to achieve an even rotation.  Accordingly, the individual who received the least votes of those recommended for directly-elected Council positions would receive the one-year term.  The consensus of the Board was that the officers and executive director and their designees shall be authorized and directed to sign any documents necessary to carry out these actions.

Mr. Riley appointed Mss. Fierstein and Kincaid to serve as tellers for the election, and the election was then conducted.

Upon a duly-held election, Robert Sohr received the most votes followed by Edward Torres.  A runoff election was held to break a tie for the third-most number of votes between Vincent Love and Nancy Newman-Limata.  Mr. Love received the most votes in the runoff.  Mr. Woehlke noted that if, for some reason, one of the recommended persons could not serve, the others would move up the list and then Mr. Love, followed by Ms. Newman-Limata, would take the available position (or positions) as first and second alternatives, respectively.

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Membership Report

Mr. Pape presented the membership report noting that as of December 7, 2006, there were 29,327 members compared to 28,368 at approximately the same time in the previous year. Of the 29,327 members included were the following: 151 new members, 3 reinstatements, 8 deaths, and 43 resignations.  Ms. McKane moved to approve the membership report and Mr. Nelson seconded the motion. The motion passed unanimously.

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Executive Session

An executive session was held.  Separate minutes for the executive session were kept.

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Adjournment

President Riley declared the meeting adjourned at 3:30 p.m.