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<br /> Embracing<br /> Ethics<br /> And<br /> Morality<br /> An Analytic Essay for the<br /> Accounting Profession<br /> Plus<br /> · CEOs, CFOs, and Fraud<br /> · Valuing Private Company Stock<br /> · What Investors Want from Audit Reports<br /> <br /> <br /> CONTENTS<br /> january 2012<br /> 22 Accounting & Auditing<br /> Auditing<br /> What Do Investors Want from the Standard Audit Report?:<br /> Results of a Survey of Investors Conducted<br /> by the PCAOB's Investor Advisory Group<br /> By Joseph V. Carcello<br /> Accounting<br /> The Continuing Evolution of Accounting for Goodwill<br /> By David A. Rees and Troy D. Janes<br /> International Accounting<br <a title="The CPA Journal - January 2012 page 1" href="http://viewer.zmags.com/publication/6f4690a9?page=1"> Embracing Ethics And Morality An Analytic Essay </a> <a title="The CPA Journal - January 2012 page 2" href="http://viewer.zmags.com/publication/6f4690a9?page=2"> </a> <a title="The CPA Journal - January 2012 page 3" href="http://viewer.zmags.com/publication/6f4690a9?page=3"> </a> <a title="The CPA Journal - January 2012 page 4" href="http://viewer.zmags.com/publication/6f4690a9?page=4"> CONTENTS january 2012 </a> <a title="The CPA Journal - January 2012 page 5" href="http://viewer.zmags.com/publication/6f4690a9?page=5"> vol. LXXXII/no. 1 6PERSPECTIVES 16IN FOCUS</a> <a title="The CPA Journal - January 2012 page 6" href="http://viewer.zmags.com/publication/6f4690a9?page=6"> Publisher JOANNE S. BARRY Ar</a> <a title="The CPA Journal - January 2012 page 7" href="http://viewer.zmags.com/publication/6f4690a9?page=7"> FAE 2012 Web Events foundation for accounting </a> <a title="The CPA Journal - January 2012 page 8" href="http://viewer.zmags.com/publication/6f4690a9?page=8"> PERSPECTIVES viewpoint Taming the Too-Big-t</a> <a title="The CPA Journal - January 2012 page 9" href="http://viewer.zmags.com/publication/6f4690a9?page=9"> publisher's column A Fresh Look at Our</a> <a title="The CPA Journal - January 2012 page 10" href="http://viewer.zmags.com/publication/6f4690a9?page=10"> (Continued from page 6) lem of sustaining behemot</a> <a title="The CPA Journal - January 2012 page 11" href="http://viewer.zmags.com/publication/6f4690a9?page=11"> with how to cushion its megabanks from excessive </a> <a title="The CPA Journal - January 2012 page 12" href="http://viewer.zmags.com/publication/6f4690a9?page=12"> City Federal Reserve Bank, Tom Hoenig, who is now</a> <a title="The CPA Journal - January 2012 page 13" href="http://viewer.zmags.com/publication/6f4690a9?page=13"> ble, conduct its operations in a manner that … mi</a> <a title="The CPA Journal - January 2012 page 14" href="http://viewer.zmags.com/publication/6f4690a9?page=14"> subjective, qualitative auditor disclosure. The c</a> <a title="The CPA Journal - January 2012 page 15" href="http://viewer.zmags.com/publication/6f4690a9?page=15"> proposal appears to be a request for a separate, </a> <a title="The CPA Journal - January 2012 page 16" href="http://viewer.zmags.com/publication/6f4690a9?page=16"> enhancing communication to investors.” I sincerel</a> <a title="The CPA Journal - January 2012 page 17" href="http://viewer.zmags.com/publication/6f4690a9?page=17"> are also concerned with compliance with all appli</a> <a title="The CPA Journal - January 2012 page 18" href="http://viewer.zmags.com/publication/6f4690a9?page=18"> In Focus Embracing Ethics And An Analytic Es</a> <a title="The CPA Journal - January 2012 page 19" href="http://viewer.zmags.com/publication/6f4690a9?page=19"> I </a> <a title="The CPA Journal - January 2012 page 20" href="http://viewer.zmags.com/publication/6f4690a9?page=20"> Culture: Lessons Learned from Arthur Andersen,” A</a> <a title="The CPA Journal - January 2012 page 21" href="http://viewer.zmags.com/publication/6f4690a9?page=21"> As a result, students later enter the pro- fe</a> <a title="The CPA Journal - January 2012 page 22" href="http://viewer.zmags.com/publication/6f4690a9?page=22"> Most large companies and professional groups, suc</a> <a title="The CPA Journal - January 2012 page 23" href="http://viewer.zmags.com/publication/6f4690a9?page=23"> its members peaking at level four—doing what is r</a> <a title="The CPA Journal - January 2012 page 24" href="http://viewer.zmags.com/publication/6f4690a9?page=24"> ACCOUNTING & AUDITING auditing </a> <a title="The CPA Journal - January 2012 page 25" href="http://viewer.zmags.com/publication/6f4690a9?page=25"> (which states that the auditor believes that the </a> <a title="The CPA Journal - January 2012 page 26" href="http://viewer.zmags.com/publication/6f4690a9?page=26"> sidering, the authors sought to make rec- ommenda</a> <a title="The CPA Journal - January 2012 page 27" href="http://viewer.zmags.com/publication/6f4690a9?page=27"> respondents. The opinion of those in favor of exp</a> <a title="The CPA Journal - January 2012 page 28" href="http://viewer.zmags.com/publication/6f4690a9?page=28"> Sensitivity analyses performed by the engageme</a> <a title="The CPA Journal - January 2012 page 29" href="http://viewer.zmags.com/publication/6f4690a9?page=29"> audit adjustments discussed with manage- ment (39</a> <a title="The CPA Journal - January 2012 page 30" href="http://viewer.zmags.com/publication/6f4690a9?page=30"> standing this fact, respondents generally favored</a> <a title="The CPA Journal - January 2012 page 31" href="http://viewer.zmags.com/publication/6f4690a9?page=31"> </a> <a title="The CPA Journal - January 2012 page 32" href="http://viewer.zmags.com/publication/6f4690a9?page=32"> ACCOUNTING & AUDITING accounting </a> <a title="The CPA Journal - January 2012 page 33" href="http://viewer.zmags.com/publication/6f4690a9?page=33"> become zero, some arbitrary period with- in a ran</a> <a title="The CPA Journal - January 2012 page 34" href="http://viewer.zmags.com/publication/6f4690a9?page=34"> EXHIBIT 1 Accounting for Goodwill </a> <a title="The CPA Journal - January 2012 page 35" href="http://viewer.zmags.com/publication/6f4690a9?page=35"> ment, including: 1) modifying the guidance on usi</a> <a title="The CPA Journal - January 2012 page 36" href="http://viewer.zmags.com/publication/6f4690a9?page=36"> ACCOUNTING & AUDITING international acc</a> <a title="The CPA Journal - January 2012 page 37" href="http://viewer.zmags.com/publication/6f4690a9?page=37"> The study examined a sample of litiga- tion-re</a> <a title="The CPA Journal - January 2012 page 38" href="http://viewer.zmags.com/publication/6f4690a9?page=38"> inate disclosure. Thus, many respondents believe </a> <a title="The CPA Journal - January 2012 page 39" href="http://viewer.zmags.com/publication/6f4690a9?page=39"> between U.S. GAAP and the short-term convergence </a> <a title="The CPA Journal - January 2012 page 40" href="http://viewer.zmags.com/publication/6f4690a9?page=40"> Some commentators also note that, because t</a> <a title="The CPA Journal - January 2012 page 41" href="http://viewer.zmags.com/publication/6f4690a9?page=41"> small businesses in complying with the proposed c</a> <a title="The CPA Journal - January 2012 page 42" href="http://viewer.zmags.com/publication/6f4690a9?page=42"> TAXATION tax policy Prospects for U.S. Co</a> <a title="The CPA Journal - January 2012 page 43" href="http://viewer.zmags.com/publication/6f4690a9?page=43"> rates. For example, depending upon the specific d</a> <a title="The CPA Journal - January 2012 page 44" href="http://viewer.zmags.com/publication/6f4690a9?page=44"> EXHIBIT 1 Taxatio</a> <a title="The CPA Journal - January 2012 page 45" href="http://viewer.zmags.com/publication/6f4690a9?page=45"> EXHIBIT 1 Taxatio</a> <a title="The CPA Journal - January 2012 page 46" href="http://viewer.zmags.com/publication/6f4690a9?page=46"> (Continued from page 41) deferral plays a major r</a> <a title="The CPA Journal - January 2012 page 47" href="http://viewer.zmags.com/publication/6f4690a9?page=47"> Exhibit 3 summarizes the impact of deferral on </a> <a title="The CPA Journal - January 2012 page 48" href="http://viewer.zmags.com/publication/6f4690a9?page=48"> FINANCE business valuation </a> <a title="The CPA Journal - January 2012 page 49" href="http://viewer.zmags.com/publication/6f4690a9?page=49"> to structure stock sales that benefit the company</a> <a title="The CPA Journal - January 2012 page 50" href="http://viewer.zmags.com/publication/6f4690a9?page=50"> 8% ÷ (1 – tax rate) = the pretax rate. The corres</a> <a title="The CPA Journal - January 2012 page 51" href="http://viewer.zmags.com/publication/6f4690a9?page=51"> The company is either relatively new or has e</a> <a title="The CPA Journal - January 2012 page 52" href="http://viewer.zmags.com/publication/6f4690a9?page=52"> The age, investment, retirement, or estate pl</a> <a title="The CPA Journal - January 2012 page 53" href="http://viewer.zmags.com/publication/6f4690a9?page=53"> (such as discount rates and capitalization rates)</a> <a title="The CPA Journal - January 2012 page 54" href="http://viewer.zmags.com/publication/6f4690a9?page=54"> nize the cash transfer as an ESOP contri- bution </a> <a title="The CPA Journal - January 2012 page 55" href="http://viewer.zmags.com/publication/6f4690a9?page=55"> or supplier, an intellectual property licen- sor </a> <a title="The CPA Journal - January 2012 page 56" href="http://viewer.zmags.com/publication/6f4690a9?page=56"> to an ESOP stock purchase transaction, as compare</a> <a title="The CPA Journal - January 2012 page 57" href="http://viewer.zmags.com/publication/6f4690a9?page=57"> indenture, or other contract. In contrast, an ESO</a> <a title="The CPA Journal - January 2012 page 58" href="http://viewer.zmags.com/publication/6f4690a9?page=58"> MANAGEMENT cpa consultant Wha</a> <a title="The CPA Journal - January 2012 page 59" href="http://viewer.zmags.com/publication/6f4690a9?page=59"> thereby minimizing total quality costs (pre- vent</a> <a title="The CPA Journal - January 2012 page 60" href="http://viewer.zmags.com/publication/6f4690a9?page=60"> The quality mission statement could be organiz</a> <a title="The CPA Journal - January 2012 page 61" href="http://viewer.zmags.com/publication/6f4690a9?page=61"> defect rate for departments 1 and 3, which is app</a> <a title="The CPA Journal - January 2012 page 62" href="http://viewer.zmags.com/publication/6f4690a9?page=62"> the ISO does not issue ISO 9001 certifi- cation. </a> <a title="The CPA Journal - January 2012 page 63" href="http://viewer.zmags.com/publication/6f4690a9?page=63"> certain best practices in achieving and maintaini</a> <a title="The CPA Journal - January 2012 page 64" href="http://viewer.zmags.com/publication/6f4690a9?page=64"> RESPONSIBILITIES & LEADERSHIP fraud </a> <a title="The CPA Journal - January 2012 page 65" href="http://viewer.zmags.com/publication/6f4690a9?page=65"> The second study, “Report to the Nations: 2010 </a> <a title="The CPA Journal - January 2012 page 66" href="http://viewer.zmags.com/publication/6f4690a9?page=66"> EXHIBIT Selected Recent Research Related to CEOs,</a> <a title="The CPA Journal - January 2012 page 67" href="http://viewer.zmags.com/publication/6f4690a9?page=67"> tendencies toward narcissism, especially when com</a> <a title="The CPA Journal - January 2012 page 68" href="http://viewer.zmags.com/publication/6f4690a9?page=68"> TECHNOLOGY the cpa & the computer </a> <a title="The CPA Journal - January 2012 page 69" href="http://viewer.zmags.com/publication/6f4690a9?page=69"> brings a number of significant risks that have ve</a> <a title="The CPA Journal - January 2012 page 70" href="http://viewer.zmags.com/publication/6f4690a9?page=70"> taining data of different companies, while such c</a> <a title="The CPA Journal - January 2012 page 71" href="http://viewer.zmags.com/publication/6f4690a9?page=71"> Influence of Cloud Computing on Audits The em</a> <a title="The CPA Journal - January 2012 page 72" href="http://viewer.zmags.com/publication/6f4690a9?page=72"> tices used to deliver services. This report is in</a> <a title="The CPA Journal - January 2012 page 73" href="http://viewer.zmags.com/publication/6f4690a9?page=73"> JANUARY 2012 / THE CPA JOURNAL </a> <a title="The CPA Journal - January 2012 page 74" href="http://viewer.zmags.com/publication/6f4690a9?page=74"> TECHNOLOGY what to bookmark Website of </a> <a title="The CPA Journal - January 2012 page 75" href="http://viewer.zmags.com/publication/6f4690a9?page=75"> organizations could meet demand in 2011. Even mor</a> <a title="The CPA Journal - January 2012 page 76" href="http://viewer.zmags.com/publication/6f4690a9?page=76"> CLASSIFIEDMARKETPLACE PROFESSIONAL OPPORTUNITY l </a> <a title="The CPA Journal - January 2012 page 77" href="http://viewer.zmags.com/publication/6f4690a9?page=77"> Goldstein Lieberman & Company LLC one of the reg</a> <a title="The CPA Journal - January 2012 page 78" href="http://viewer.zmags.com/publication/6f4690a9?page=78"> SALES TAX, AUDITS, APPEALS, & CONSULTATIONS. Expe</a> <a title="The CPA Journal - January 2012 page 79" href="http://viewer.zmags.com/publication/6f4690a9?page=79"> PROFESSIONAL CONDUCT EXPERT PROFESSIONAL CONDUC</a> <a title="The CPA Journal - January 2012 page 80" href="http://viewer.zmags.com/publication/6f4690a9?page=80"> </a> <a title="The CPA Journal - January 2012 page 81" href="http://viewer.zmags.com/publication/6f4690a9?page=81"> ECONOMIC & MARKET DATA monthly upd</a> <a title="The CPA Journal - January 2012 page 82" href="http://viewer.zmags.com/publication/6f4690a9?page=82"> EDITORIAL a message from the editor-in-c</a> <a title="The CPA Journal - January 2012 page 83" href="http://viewer.zmags.com/publication/6f4690a9?page=83"> </a> <a title="The CPA Journal - January 2012 page 84" href="http://viewer.zmags.com/publication/6f4690a9?page=84"> </a>