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Do you remember where you were when you saw the famous cartoon that killed Arthur Andersen?  I received a copy via e-mail, and soon had a print up on my office door.

How could it be that a cartoon killed Arther Anderson (once of the mighty Big 8,7, 6, and 5, but not the Big 4)?

First, a bit of history for those of you too young to have been there.  Arthur Andersen was declared dead officially June 15, 2002, when it was convicted of criminal obstruction of justice.  Arthur Andersen entered a vegetative state in March, 2002, when criminal charges were filed against it.  Arthur Andersen was seriously wounded in October, 2001, when it began shredding documents.  Reports Unmesh Kher of Time,

… Nancy Temple, a lawyer with the company, sent a memo reminding employees of Andersen’s document-retention policies on Oct. 12. The memo, observers suspect, was a tacit order to start the shredding.

And now, to add a new twist to the scandal, plaintiffs’ lawyers involved in the deposition of Duncan’s former assistant Shannon Adlong told TIME last week that the shredding of documents actually began on Oct. 13 — 10 days before Andersen admitted it started and a day after Temple’s memo. Adlong, who was responsible for ordering extra bags for the shredded papers, said so much evidence had to be destroyed that 32 “trunks,” each the size of a football locker, were hauled off by a shredding company.

Word of shredding leaked out quickly, and soon I received an e-mail with the following cartoon attached:

After this cartoon spread around the world, AA had no chance.  It’s fate was sealed.  The cartoon welded Andersen’s crime to an immensely popular TV advertising campaign.  Whenever Sprint aired its ads, at least some viewers would think of Andersen and shredding  Overnight, Andersen was guilty in the court of public opinion.  It would be only a matter of time before a court of law caught up with it.

I remain convinced it was the circulation of this cartoon that prompted the SEC subpoena on December 1, 2001, for Andersen’s remaining documents.  That, and the fact that Andersen really did the crime.

Eventually, Andersen’s shredding made it into a real commercial advertisement.  The following commercial was first aired on November 28, 2002, after Andersen was officially dead.

Thanks to the Grumpy Old Accountants and Going Concern for reminding me of the 10 year Enron anniversary.

Debit and credit – – David Albrecht

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How is a mugger different from an IRS agent?  Both take your money, but the mugger doesn’t make you fill out forms.

It is April 18, 2011, tax forms must be filed no later than today.  Of course, it is easy to get a six month extension.  Come October 17, 2011, there will be a line of taxpayers at the post office filing for an additional extension.

Actually not. Not in the age of e-filing.  That’s a shame. Back in the mid-70s I was a clerk at the U.S. Post Office in Iowa City, working the 11 p.m. to 7 a.m. shift (ugh!).  One year I was sent outside to empty the mail box at 11:59 p.m.  There were six cars backed up.  I had instructions to accept mail from anyone in line when the clock struck midnight.  I miss those days.

Tax is a day of accountability, but not accounting.  I’ve always viewed taxes as the practice of law, not the practice of accounting.

I haven’t seen many good cartoons this year, so I’m going to recycle a classic.

And now, for a really clever cartoon about the complicated tax code.

Debit and credit – – David Albrecht

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How well does the average person understand financial statement manipulation?  Sometimes the numbers are gimmicked up because of odd nonsensical transactions, ala Lehman Brothers.  Sometimes the numbers are out and out fictionalized.  Sometimes investor attention is simply distracted away.

Bob Jensen passed along a post over at the AECM listserv, in which he used a few Barbie dolls to make a point.  Sprucing it up just a bit, here’s the story. [Disclaimer: I do not support the “culture of thinness” promoted by Barbie Dolls.]

Lehman Brothers Balance Sheet “Before”

Lehman Brothers balance sheet bloated with too many financial liabilities

Lehman Brothers Balance Sheet “After”

The balance sheet after cash from Repo 105/108 has paid down financial liabilities

SEC’s Mary Schapiro Called to the Rescue

There were no pictures of Barbie as a white knight in shining armor


Switching the subject, just a bit.  Over the years, Mattel (producer of Barbie dolls) has used child actors to promote its toys.  Recently, it used two of the cutest to present a disclaimer that precedes an interactive edition of its annual report.  I can’t embed the video (as much as I’d like to), so click on the following link and press the start button.  In my opinion, this is inappropriate.  Financial reporting is serious business for serious people.  It shouldn’t be made light of.  And, after watching this “kid” disclaimer, I think the viewer is happy enough to cut Mattel some slack for whatever follows.

http://corporate.mattel.com


My apologies to the copyright owners of these images.  I’ve borrowed without permission.  If you come across this page, would you grant me permission to use these images?

Debit and credit – – David Albrecht

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I don’t know where you were last month when Accounting Day, or Accountant Day, came around. I had a blog post ready to publish, but forgot to press the correct button. Never-the-less, I celebrated it. With chocolate and diet coke.

Is it true that chocolate and diet coke (or diet pepsi) have replaced pretzels and beer as number one staples in an accountant’s road diet.

accountantdaylarge

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Have you ever heard that a good accountant is a credit to the accounting profession?  I prefer to think that a good accountant is a debit to the accounting profession.

These images are for those needing a smile.   I’m using royalty free images from Broderbund and my own warped sense of humor.  My renditions are not in the public domain.

Over and out – – David Albrecht

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Another long week. These images are for those needing a smile. I’m using royalty free images from Broderbund and my own warped sense of humor. My renditions are not in the public domain.

Over and out – – David Albrecht

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Friday. It’s been a long week.  Maybe these pictures can produce a smile.

I apologize for hitting accounting’s negative stereotypes.  It’s just that the negatives are easier to make appear humorous.  I’m using royalty free images from Broderbund and my own warped sense of humor.   My renditions are not in the public domain.

Next Friday’s post will show accounting advertisements that we probably don’t want to see, such as Rocket CPA and Creative Accountants.

Over and out – – David Albrecht


Actual 2008 Pulitzer Winners and Finalists (there is no category for accounting fiction):

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A little rebellion now and then…is a medicine necessary for the sound health of government.
Thomas Jefferson (1743 – 1826), Letter to James Madison, 1787

In his blog of Aug. 25, 2008, Tim Reason of CFO.com asks, Is There an IFRS Resistance Movement?

If there isn’t, there ought to be.  I don’t know who would be the general, or even the spokesman.  However, some leading accounting professors are coming out against International Financial Reporting Standards (IFRS) and in favor of United States Generally Accepted Accounting Principles (GAAP).  And last week, PCAOB member Charles Niemeier spoke out against adopting IFRS.  Who is the next high profile regulator to come out against the SEC push for IFRS?  I heard a colleague conjecturing that it could possibly be SEC Commissioner Elisse B. Walter (democrat).

Over the weekend, I posed Tim Reason’s question on the international listserv for accounting professors–AECM.  The discussion is still going on.  However, the first three responses were pretty enlightening:

Why?  There is no use in beating a dead horse.

Resistance is futile.

No use in beating your head against a dead horse.
(pseudo yogiism by Ed Scriber)

It is difficult for me to see other baby boomer accounting professors avoiding the opportunity to engage in the protest movement of a professional lifetime.

Nearly 40 years ago, I had a great time manning the barricades, painting and carrying signs, staying out all night and chasing cute female protesters.  It is the painting signs qualification that I now offer the anti-IFRS movement.  With Google image search combined with word processing and screen capture programs, I came up with the following posters and images for the First Accounting War of the 21st century.  These are part tongue-in-cheek, part serious.

Is American resistance to IFRS futile?

I love GAAP

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