NEWS HIGHLIGHTS FOR WEDNESDAY - 10.5.16

By:
Maya Lindsay
Published Date:
Oct 5, 2016

Accounting and Financial News Stories

Hedge Fund Targets Companies’ Weakness: The Gender Gap
New York Times
The chief executive at a plastics company was playing golf. A lot of golf. The activist hedge fund the Barington Capital Group, through a website that tracked golfers’ handicaps, found that the chief executive was routinely playing 18 holes or more on weekdays, even as the company’s stock price was lagging. It was that finding a decade ago that helped shape the career of Dianne McKeever, then a partner at Barington.

10 Habits That Threaten Your Firm’s Data Security
Accounting Today
They’re just old habits. You likely do them without even thinking. But these 10 habits could be making your company vulnerable to hacks and other cyberattacks. Sharing passwords - It may not seem like a big deal to share your password with a coworker that you’re close to, but even if that person is completely trustworthy, someone else may overhear you. You should always keep your passwords completely confidential to ensure that they don’t fall into the wrong hands.

Top considerations for 2016 audit cycle
Journal of Accountancy
New rules about disclosing the name of the engagement partner—as well as a continued regulatory focus on internal control over financial reporting—are some of the main topics auditors need to consider during the 2016 audit cycle, according to new risk alerts published Tuesday by the Center for Audit Quality (CAQ). The CAQ, which is affiliated with the AICPA, issued alerts for auditors in general, and for auditors of brokers and dealers. The alerts identify some of the more judgmental or complex audit areas for the 2016 audit cycle.

Nonprofit Boards Offer Career Boosts for Executives
Wall Street Journal
Executives are doing good for others—and good for their careers—by joining boards of nonprofit organizations. Consider Fred Strobel. In 2012, the Morgan Stanley executive became a director at Tuesday’s Children, created to aid youngsters who lost a parent during 9/11 terrorist attacks. John Cahalane, a Tradeweb Markets LLC.

How Self-Certification Fosters Employee Honesty
CPA Practice Advisor
To stop a thief can be a formidable challenge. But keeping honest people honest doesn’t seem easy either – or so the CEO of Wells Fargo appeared recently to suggest in defending the firing of 5,300 employees for deceptive practices. How to keep the honest majority honest in the face of temptations to be unethical? New research in the scholarly journal Behavioral Research in Accounting tests a simple, trusting approach and finds it yields promising results.

Utilities Drive Shares Down and Bond Yields Rise
New York Times
Stocks on Wall Street fell broadly on Tuesday, led by sharp drops in utilities and phone companies. United States government bond prices slumped, and gold had its worst day in nearly three years. A big driver of the day’s trading was rates, with investors closely watching the yield of the benchmark 10-year Treasury note, which has risen as the price of the note has dropped. The yield on Tuesday rose to 1.69 percent, up from 1.63 on Monday, and up more than a tenth of a percentage point in less than a week.

AICPA Issues Rev Rec Drafts
Accounting Today
The Financial Reporting Executive Committee of the American Institute of CPAs has issued seven working drafts covering issues related to revenue recognition. Specifically, the drafts cover accounting issues related to the implementation of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers, in areas including asset management, gaming, software and telecommunications. The ASU will replace the transaction- and industry-specific rev rec guidance under current U.S. GAAP with a principle-based approach, and will have a wide-ranging impact of businesses of all sorts.

AICPA issues 7 new drafts on revenue recognition questions
Compliance Week
me of the trickiest questions yet in adopting the new revenue recognition standard are addressed in new drafts of proposed accounting guidance issued by a committee of the American Institute of Certified Public Accountants. The AICPA’s task forces on software, telecommunications, asset management, and gaming have issued seven new working drafts to explain the consensus views among task force participants on how to address some of the most challenging aspects of the new standard.

Exclusive: Wells Fargo account scandal extends to small business - U.S. senator
Thomson Reuters
The scandal over improper sales practices at Wells Fargo & Co extended to thousands of small-business owners, according to a U.S. lawmaker, raising questions about the scope of the bank's issues with unauthorized accounts. In a Sept. 29 letter viewed by Reuters on Tuesday, Sen. David Vitter, a Louisiana Republican, demanded that Wells Fargo Chief Executive John Stumpf provide a "full accounting" of customers affected. Vitter is a member of the U.S. Senate's banking committee and also heads its small business committee.

EY Plans to Hire 15,200 in U.S. in FY 2017
Accounting Today
Big Four firm EY announced that it expects to hire over 15,000 new employees in the U.S. over its 2017 fiscal year, which started July 1. Of the new staff, the firm expects 6,000 to be experienced and executive-level professionals, and 9,200 to be students. In a statement, EY said that it planned the robust hiring “due to strong demand for its services in today’s shifting business and economic landscape.” It expects the biggest areas for hiring experienced recruits will be advisory and tax practices, with cyber-security, data analytics, digital, health care consulting and human capital consulting among the hotter areas.

Prepaid Debit Cards Users Will Get New Federal Protections
New York Times
Prepaid debit cards are a financial lifeline for many people, but a risky one. They lack many of the basic consumer protections that credit cards and bank debit cards are required to offer. That will change next year, with a raft of new federal rules intended to clamp down on a product that has been growing rapidly despite concerns about high fees, poor disclosures and weak protections for customers when something goes wrong.

Audit Pros Focus on Emerging Risks, Strategy
CPA Practice Advisor
Reflecting mounting pressures to focus on the strategic and emerging risks facing their parent organizations, hundreds of internal audit functions around the world are including assessments of such risks in their risk assessment processes, according to findings from the 2016 TeamMate Global Audit Technology Survey, released today at the 2016 TeamMate User Forum, being held at the JW Marriott Grande Lakes hotel in Orlando.

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