Minutes of:

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

Date & Time:

Tuesday, July 14, 2008, 8:40 a.m. to 11:00a.m.

Location:

3 Park Avenue, 19th floor, New York, New York

Presiding Officer:

Sharon Sabba Fierstein, President

Board Members Present:

David J. Moynihan, President-Elect
Barbara S. Dwyer, Vice President
Joseph M. Falbo, Jr. Vice President
Elliot L. Hendler, Vice President
Margaret A. Wood, Vice President
Richard E. Piluso, Secretary/Treasurer
Scott M. Adair
Edward L. Arcara
John Barone
Susan M. Barossi
S. David. Belsky
Thomas Boyd
Anthony Cassella
Cynthia D. Finn
Robert L. Goecks
David R. Herman*
Scott Hotalen
John B. Huttlinger, Jr.
Martha A. Jaeckle

Suzanne M. Jensen
Lauren L. Kincaid
Gail M. Kinsella
J. Michael Kirkland
Kevin Leifer
Elliot A. Lesser
David A. Lifson
Anthony J. Maltese
Mark L. Meinberg
Avery E. Neumark
Robert A. Pryba Jr.
Joel C. Quall
Ita M. Rahilly
Judith I. Seidman
Thomas M. VanHatten
Liren Wei
Charles J. Weintraub
Louis Grumet, Executive Director

Board Member Absent:

Warren M. Bergstein

Nancy A. Kirby

Staff Present:

Patricia Agard
Suvro C.K. Banerjee
Joanne S. Barry
Alex Charles
Nereida Gomez
Colleen Lutolf
Craig Mandelbaum

Ernest J. Markezin
William J. Pape
Alan Schmelkin
Paul L. Sinegal
Lois Whitehead
James A. Woehlke

B08 – C – 0
Call to Order

President Sharon Sabba Fierstein noted that a quorum was present and called the meeting to order at 8:40 a.m.

She recognized immediate past President David Lifson for his service and presented him with the past president’s pin and other mementos of his service to the Society.

B08 – C– 1
Executive Session

The Board moved into executive session at the request of the President. No actions were taken during or as a result of the executive session.

Approval of Minutes of June 4, 2008, Board Meeting

Ms. Fierstein asked Board members if they had any changes or additions to the minutes of the June 4, 2008, Board of Directors’ meeting. There being none, Ms. Rahilly moved to approve the minutes as presented and Mr. Neumark seconded. The motion passed unanimously.

a. Committee Appointments

President Fierstein discussed the committee appointment process and the methodology implemented this year to ensure periodic rotation of the membership of Operations Division committees. She explained that substantial consideration regarding rotation was given to Operations Division members who had ten or more years of continuous service.

This philosophy, which had also been espoused by both prior Society past presidents, was designed to infuse committees with fresh thinking and to provide the opportunity for more members to participate. In implementing this policy, Ms. Fierstein took a close look at Operations Division committee membership and focused on the following considerations:

• Tenure on committee
• Performance feedback from committee chairs
• Geographic distribution of committee members
• Attendance

In response to a Board member inquiry, Ms. Fierstein indicated that members were notified of their removal from the particular committees with a letter thanking them for their service including an invitation for them to participate on other Society committees. She also indicated that committee chairs had been notified of the roster changes. A guest suggested that this process might be considered for a bylaw change. Ms. Fierstein indicated that it could certainly be considered, but at the present time, the bylaws and Board standing rules appeared to provide sufficient guidance. President-Elect Moynihan indicated his support for the new initiative.

b. AICPA Update

Ms. Fierstein reported on discussions at the AICPA Council meeting in May including the AICPA movement to have IASB recognized as the body to establish professional standards with respect to international accounting and reporting principles. She remarked that IFRS.com is a good website to learn more about this initiative. The Council meeting also included a discussion of the AICPA’s introduction of the Certified in Financial Forensics credential. She stated that several members of the New York delegation had opposed the new credential.

c. Review of 2008 Leadership Conference

Ms. Fierstein solicited feedback for the current Leadership Conference location and format and noted that young CPA committee chairs suggested breakout sessions to coincide with the chapters and committee sessions at future Leadership Conferences. She also suggested that young CPA chairs begin the practice of having monthly calls similar to the chapter president calls. Board members expressed satisfaction with the location overall. In answer to a question about the time of year the event is held, Ms. Fierstein stated that the time of year was chosen due to cost considerations. Ms. Fierstein expressed her appreciation for the input and added that conference planners would explore incorporating more committee and chapter activities as well.

a. Quality Enhancement Policy Committee Update

Mr. Moynihan discussed the dissemination of the Pre-Certification Education White Paper. An article about the paper appeared in the May 1, 2008 issue of The Trusted Professional and it would also be featured in the August issue of The CPA Journal. Additionally, the meeting packet for the June 18th meeting of the State Board for Public Accountancy included a copy. Copies were also sent to the New York State Board of Regents, with the suggestion that the group take the lead in changing the required accounting curriculum in the state. Mr. Moynihan closed by stating that the QEPC has now turned its attention to the profession’s CPE requirements.

b. 2009 Leadership Conference Location

Mr. Moynihan noted that, subject to the result of negotiations, the current plan was to hold the 2009 Leadership Conference at Turning Stone Resort.
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a. Chapters Update

Chapter Vice President Dwyer stated that she had visited several chapters. Ms. Dwyer relayed a request from the Manhattan/Bronx chapter to urge registration for a golf tournament on July 28th. One Board member stated that the Westchester and Queens chapters could assist the Manhattan/Bronx Chapter leadership with the event. Chapter Vice Presidents Falbo and Dwyer stated that they would work to improve communication to enable the chapters to all benefit from learning the strengths and assist with overcoming the weaknesses experienced by specific chapters. Ms. Dwyer closed by noting that the Society had hired two new membership employees.

Mr. Pape discussed challenges facing the Brooklyn chapter in recruiting leadership. At that time, the chapter had only two executive board members. Mr. Pape stated the chapter needed to reach out to the CPA community in Brooklyn.

b. Recent Society Comments

Ms. Wood stated that in fiscal year 2007-08, the Society issued a record 30 comment letters. As of July 3rd, five comment letters had been issued in the current year. Three more letters were in development at that time.

c. Committees Update

Mr. Hendler stated that he would like to do more for committee chairs. A discussion of successes and failures ensued. Mr. Hendler said bringing in new people remained a challenge. One possible remedy discussed was encouraging existing committee members to invite younger staff from their firms and offices to attend the committee meetings.

a. Nominating Process Report

Mr. Piluso urged Board members to encourage other members to apply for positions on the Nominating Committee. Mr. Woehlke stated that a downloadable version of the petition to join the Nominating Committee was available on the Society website at http://www.nysscpa.org/governance/nomination_center.htm.

b. Financial Statement for Twelve Months Ending May 31, 2008

Mr. Banerjee stated that the Society completed another year in which it exceeded financial expectations. Overall, he noted, the Society’s 2008 net income was $352 Thousand. This represented a favorable variance to budget of $176 Thousand and to the preceding year of $717 Thousand.

Mr. Banerjee broke down the remainder of his report in terms of the Society’s strategic initiatives, comparing them to budget and the preceding year.

• Professional Competency. This strategic goal included CPE Program Support, The CPA Journal, and committees. For the fiscal year ending May 31, 2008, this goal was $607 Thousand better than budget and $709 Thousand better than the previous year. While discussing this goal, Mr. Banerjee noted that FAE had enjoyed improved financial results for three years running. The Society had budgeted to provide $719 Thousand to FAE for the fiscal year, and in the final analysis provided only $419 Tnousand because of the excellent results enjoyed by FAE for the year.
• Public Trust. This strategic goal included peer review and ethics. For the fiscal year ending May 31, 2008, this goal was $186 Thousand better than budget and $204 Thousand better than the previous year.
• Advocacy. This strategic goal included member service, chapters, governance, and government relations. For the fiscal year ending May 31, 2008, this goal had net revenue of $3.9 Million, which was unfavorable to budget by $524 Thousand but $53 Thousand better than the previous year. He explained the primary cause of the unfavorable variance to budget as additional expenses in the governance area.
• Recognition and Visibility. This strategic goal included communications, member benefits, the Trusted Professional, and website management, which was unfavorable to budget by $198 Thousand. This was due to incurred additional expenses due to increased publicity activities to promote the SET Tax and other public relations initiatives.
• Recruiting and Retention: This strategic goal was $114 Thousand better than budget because of staff allocations. The unfavorable variance to fiscal year 2007 was due to a position that had remained vacant for a portion of fiscal year2007, but was filled early in fiscal year 2008.
  

a. Legislative Update

Mr. Grumet said after nine years of working to achieve accountancy law reform, a number of things occurred during this session. In 2008, the Society endorsed the State Education Department’s bill. Mr. Grumet reported that bill had bipartisan support. This year, for the first time, the Assembly passed a bill that was close to what the Society had wanted to achieve. An identical bill was readied for passage in the Senate. Mr. Grumet stated that the Society was told that the Assembly bill was not acted upon in the Senate because Senator LaValle had wanted his name first on the bill, which would not occur if the Senate passed the Assembly’s bill, and the Assembly had adjourned leaving no time to accommodate the Senator’s wishes, assuming the Assembly leadership would have been so inclined. Mr. Grumet then said if the Senate returned in July, the bill would either be passed or “die” for the year. He urged membership to call or write Senator LaValle to bring the Assembly bill to the floor and vote for it.

A guest at the meeting asked how the exchange of letters with a number of the larger local firms had affected the bill’s status. Mr. Grumet responded that the exchange had actually brought the bill to the attention of more of the legislators, in the end, enhanced its chance of passage.

Ms. Fierstein discussed the amendment to the Commissioner’s regulations that would allow candidates to sit for the CPA examination after completing 120 semester hours of education rather than waiting to complete the full 150 hours required beginning August 1, 2009. Board members stated it was a good idea and a step in the right direction. The compromise would work to retain more people in the profession. It was also noted that some members were bitterly opposed to the 150-hour requirement; the new amendment was an olive branch.

Mr. Lifson moved that the NYSSCPA endorse the proposed Commissioner’s regulation that would allow CPA candidates to sit for the CPA examination after completion of a 120-hour curriculum and that the President be authorized and directed to communicate this endorsement to the New York State Board of Regents. Mr. Piluso seconded.

During the ensuing discussion, Ms. Fierstein suggested that the Board also use this opportunity to communicate the Society’s preference to have the education taken by CPA candidates in excess of 120 hours culminate in a graduate degree. This would be in accord with the recommendations in the Board-approved White Paper on Higher Education. Mr. Moynihan moved to amend the pending motion to have the proposed letter to the Regents also recommend that the regulations be amended to require that the 150-hour curriculum be amended to require a graduate degree. Ms. Wood seconded the motion to amend. Following discussion the motion to amend passed unanimously.

President Fierstein restated the motion on the floor as follows: That (1) the NYSSCPA endorse the proposed Commissioner’s regulations to allow CPA candidates to sit for the CPA examination after competing an accounting curriculum of 120 hours, (2) the NYSSCPA include with that endorsement its recommendation that the required curriculum for licensure in excess of 120 hours include receipt of a graduate degree, and (3) the appropriate Society officers be authorized and directed to communicate this endorsement and recommendation to the New York State Board of Regents in writing. Following discussion, the motion passed unanimously.

b. COAP Update

Mr. Grumet reported that COAP had served 285 students in 2008. He said that plans were in place to expand the program with three new programs. Mr. Grumet noted that this year the programs including overnight accommodations had shifted some or all of the residential costs to the host colleges or universities. Mr. Grumet suggested that three options for COAP expansion included Staten Island, the Mid-Hudson and the Adirondack Chapter.

c. Dues Update

Mr. Grumet reported that seventy-five percent of member dues had been collected and that this was on par with prior years.

a. Report from FAE President

Ms. Cohen, the President of FAE, stated that 43 conferences and 409 seminars were held during the 2007-08 fiscal year with 14,500 registrants, a higher number than the previous year. It was the third year in a row of improved financial results for FAE. There had been an increase in advertising the “Pay One Price,” or “POP,” program and recognition of a greater need for higher level programming in response to the results of the recently concluded survey regarding FAE products and services.

At Ms. Cohen’s invitation, Mr. Pape discussed the Scholarship for Excellence and the COAP scholarship programs. Three COAP scholarships were awarded in 2008. Regarding the Excellence in Accounting Scholarship program, 59 scholarships were approved by the FAE Trustees for 2007/2008.

b. Proposed Merger with Benevolent Fund

Mr. Woehlke reported that the publication of notice of the proposed FAE/Benevolent Fund merger to the membership had recently concluded without any comment from the membership. The merger papers would be filed with the appropriate state authorities within the month.

Ms. Fierstein noted that per the Board’s Standing Rule SR-1, which states:

SR-1. Establishment of selections subcommittee—Each year, on or before August 1, the Board shall establish a selections subcommittee composed of the President-Elect, who will serve as the subcommittee chair, plus four Board members to be appointed by the President. Two of the appointees are to be at-large directors and two are to be chapter representatives.

To comply with the standing rule, Ms. Fierstein announced that Mr. Moynihan would chair the subcommittee, per the terms of the standing rule, and she had appointed the following additional members to round out the subcommittee’s roster: Mss. Kinsella, Kirby, and Seidman and Mr. Maltese.