The Value of Sports
By Melissa Lajara
If you’re a Yankees fan, the high cost of tickets in the Bronx Bombers’ new stadium may have you scratching your head and missing more than a few home games... even though the owners decided to slash some of the highest prices.
But there’s some rhyme and reason behind the team’s $90 nosebleed-section seats -- the cheapest available -- said valuation expert Dr. Peter L. Lohrey, and at a meeting of the Entertainment and Sports Committee this morning, he explained the factors considered in the valuation of a sports franchise.
“It’s important to note that the driver for one franchise isn’t the same as another,” he said. For example, ticket revenue in Minnesota is going to be a very different number than in Miami or New York City.
In addition to ticket sales, there are other types of revenue that add to a franchise’s value, among them concession stand sales, broadcasting revenue and pubic versus private stadium ownership. To learn more about how one figures the value of institutional sports teams like the Yankees or the Dallas Cowboys -- which, in turn, sets ticket prices -- or have wondered why the New York Giants built their stadium in New Jersey, check out an upcoming story in the CPAs in industry section of the July 15 Trusted Professional.
Tax Professionals Learn About New Accountancy Law
By Melissa Hoffmann Lajara
NEW YORK -- Tax practitioners are among the CPAs not regulated under current New York state law, which also omits those working in industry, academia and consulting. In fact, the state “has absolutely no authority over anyone not doing the attest function,” NYSSCPA Executive Director Lou Grumet told a group of CPAs from Tax Executives International (TEI), on April 21 who came to the Society’s offices to learn how the new law affects CPA tax professionals.
Come July 26, that’s all going to change. When the reform law takes effect, it will bring all CPAs under the same regulatory umbrella through an expanded scope of practice and increased education requirements.
For CPAs working in tax and industry, the law “triggers the obligation to register as a CPA, and that is a triennial registration requirement,” said Dennis O’Leary, the Society’s legislative counsel. Even those CPAs who have been inactive will have to register or file a declaration with the state indicating that he or she is not, in any way, holding him or herself out as a CPA, Grumet said.
“If you do not file that declaration you will be considered to be practicing public accountancy,” he said.
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Bank EVP Talks to CFO Committee About Modern Credit Market
By Chris Gaetano
NEW YORK -- Despite perceptions otherwise, banks still have credit they’re willing to extend, said a speaker at a recent NYSSCPA Chief Financial Officers Committee meeting. How it’s being extended, and to whom, however, is a different story.
Signature Bank Executive Vice President and Chief Credit Officer Michael J. Merlo discussed the ways in which bank lending practices have changed, and remained the same, in today’s economic climate. The speaker gave his talk during the committee’s March 26 meeting at the Society headquarters in Manhattan before an audience of 43 people (with 13 more listening on conference call).
The credit market isn’t dead, Merlo said, just changed. While the trials and tribulations of larger financial institutions and the debts they manage have dominated headlines, lending is still active, especially among smaller community banks. Overall industry-wide lending fell by only 1.4 percent from the third to fourth quarter while two out of three banks, he said, actually increased their lending in the fourth quarter.
So why the crisis? The issue, Merlo said, was not in credit in and of itself but in the types of credit affected by the recession. For example, consumer credit, an extremely visible aspect of the market has “dried up,” because “the consumer’s not as strong today as they were a year or two ago,”Merlo said.
Merlo is less optimistic about commercial real estate lending. He pointed out that such ventures are not the cash generators they were three years ago. Tenants are eager to renegotiate their leases, if they don’t end up out of business entirely. For Merlo, the bottom on this market has yet to be reached. It’s going to get worse, he said, but not every bank makes those kinds of loans. Those that didn’t are a little more insulated from the challenges of the credit market and so have a little more freedom to lend than some of their contemporaries.
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CFO Conference Offers a Look Ahead
By Nyasha Foy
NEW YORK -- In this difficult economic climate, many fingers of blame have been pointed—at some at CEOs and other financial executives.
Former Comptroller of the United States David M. Walker, currently president of the Peter G. Peterson Foundation, will speak at the conference, as will a panel of top CFOs and a chief economist from a major bank.
“In addition, we will have partners from several prestigious CPA firms to provide a GAAP/FASB and tax update, a highly rated speaker to discuss how to manage people, and a chief risk officer to discuss the current lending practices for middle market companies today,” said Michael F. Rosenblatt, chair of the NYSSCPA’s Chief Financial Officers Committee.
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Joint FASB/IASB Project Kicks Into High Gear
By Melissa Hoffmann Lajara, Trusted Professional Staff
February 19, 2009
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The NYSSCPA Banking Committee meeting on February 19, 2009 Source: NYSSCPA Staff
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NEW YORK -- Now that it has upheld fair value accounting, the Securities and Exchange Commission (SEC) is pushing the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) to complete a two-year-old Financial Statement Presentation Project.
This is according to CPA Dina Maher, the head of U.S. accounting research for FitchRatings’ Credit Policy Group, who detailed the project and its next steps at a recent meeting of the NYSSCPA’s Banking Committee.
“The SEC has shown they’re willing to pressure the standard setters … if they think it’s in the public’s best interest,” Maher said. “The FASB and IASB have to move quickly now with the SEC saying ‘go get this done.’”
To that end, she said, testing is already underway at a few companies and an exposure draft is pending its completion. In addition, a joint discussion paper was released in October on the project, with a comment period open until April 14.
“The SEC in its fair value study said that both the FASB and IASB should speed up the process of moving forward with this project … because disclosures would help users understand fair value better,” Maher said.
She said the project “also becomes an ad for XBRL” in its focus on providing more useful information.
More project details and materials can be found here.
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The CPA Job Market: Opportunities and Obstacles
By Melissa Hoffmann Lajara, Trusted Professional Staff
February 5, 2009
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From left to right, Tom Waldron (Head of Executive Search Division - Banking & Financial Markets, Michael Page International), Bruce Friedman (Associate Director of Recruitment, KPMG LLP), Michael Rosenblatt (President, The Quest Organization)
Source: NYSSCPA Staff
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NEW YORK -- A combination of economic recession, stock market tumult and elaborate fraud is quickly changing the face of financial services. For many CPAs working in finance, what was once a reliable paycheck has become a question mark.
In the securities industry alone, New York State Comptroller Thomas P. DiNapoli estimates that 19,200 New York City jobs were shed in the last two months of last year. Could 2009 actually be worse?
New York City is expected to lose 181,000 jobs in the next 12 months, with 50,000 of those disappearing from the financial services sector, according to Bruce Friedman, associate director of recruiting for KPMG. Overall unemployment is expected to rise above 10 percent in dozens of metropolitan centers.
It may not be surprising, then, that more than 65 people braved wintry weather conditions to come to the NYSSCPA’s offices Jan. 28 for a discussion of opportunities in this very limited job market. Even more participated in the panel discussion, organized by NYSSCPA Banking Committee Chair Victor Valdivia, via a live webcast. And despite what one might expect, it wasn’t all bad news.
“In this current climate, the CPA designation is highly respected by corporations, regulators and investors alike,” said Tom Waldron, head of the executive search division for the recruiting firm Michael Page International. “CPAs are more resilient to market downturns than operations and technology professionals.”
“CPAs definitely tend to buck the national trend,” agreed Friedman. He noted that on Forbes and BusinessWeek’s list of the top recession-proof jobs, accounting executives hold the number four slot, followed by accounting staff at number five.
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