Betsy's Pretty Good Blog

It's going to be a great ride!

December 21, 2015

The public accounting profession and its professional associations, the AICPA and State Societies, are on the brink of major change.   In October, AICPA Council voted to open up the CGMA credential to “other qualified accounting professionals”.  Up until then, the CGMA was only an option for CPAs in the U.S.   Working together, State Societies and the AICPA will be introducing the CGMA to the broad business community and implementing and supporting the path to CGMA for accounting professionals who are not CPAs.  This also means new CGMAs will become members of State Societies and the AICPA.   Who are “other qualified accounting professionals”?   The major group is those with accounting degrees who choose to go directly into business and who do not pursue the CPA.   That’s roughly 2/3 of current accounting graduates.  They might also be graduates in finance or economics, or even liberal arts.  The path varies with the degree you hold, with a longer path for those without a business-related degree.  The shortest path is for the CPA. 

Another change proposed by the AICPA and requiring an AICPA member vote, is the “evolution” of the joint venture between the AICPA and CIMA.   It is proposed that these two organizations, which have been working together since 2011, join forces to create a new accounting association that would integrate management, strategy and operations while maintaining the respective membership bodies.  The AICPA would still maintain its emphasis on CPAs while CIMA would maintain its worldwide emphasis on management accounting and CGMAs.   Yes, it’s complicated and I urge you to go to the AICPA website to learn more.  

The MNCPA Board of Directors has considered the evolution in depth and has voted to support it. 

The future of the accounting profession is very exciting and I am sad that I won’t be around to be an involved participant.  But I’ll be cheerleading for the change from the sidelines.  Happy New Year!

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Rebecca Otto Goes Too Far

June 11, 2015

If you've been following the tirades of State Auditor Rebecca Otto over the last weeks, you have probably been appalled at her attacks on the integrity of "private CPA firms". In Tweets, interviews on radio and TV, she has blatantly lied about CPAs. At first when the conversation started at the end of session I gave her the benefit of the doubt and attributed the comments to the stress and craziness that takes place at the end of a legislative session. But now, almost a month later, the misstatements and slams on the profession continue. To me she sounds desperate.

She clearly makes "misstatements" and goes out of her way to insult CPAs. She says private auditors can be bought, essentially that they will give you the outcome you want.

  • "Do you want cheap audits?" Otto asked. "You get what you pay for." MPR, Otto, June 10
  • "Auditor shopping for some can be like a child parent shopping to see which one will give them the answer they want." Otto Tweet May 19
  • "Who would you rather have audit you -- the nice guy on Main St or the IRS? I know the answer and so do you." Otto Tweet May 18
  • "Have nice guy on Main audit you or the state? Bet you chose neighbor. Gvt auditors audit with your interests in mind not bottom line." Otto Tweet May 18
  • "Who would you rather have audit you - the nice guy down the street or the IRS? I'm sure first one. Gov ensures acctblty." Otto Tweet May 18
  • "I would rather have audits done by someone accountable to MN'S than some third-rate outfit that's lowest bidder." , retweet by Otto May 18

CPAs don't sit down with clients and say "Tell me how you want this audit to come out." (I can't believe I have to write this!) Standards and Ethics demand independence and CPAs support the actions taken against rogue CPAs who violate those standards. In addition, County Commissioners who choose the private auditor are accountable to the voters. Ms. Otto thinks that she's the only one who serves the public.

Private CPA firms, who currently do 28 county audits, have to follow the "Audit Guide for Financial and Compliance Audits of Minnesota Counties" issued by the State Auditor's office. Page 1 -- "The specifications in this manual apply to all audits of counties, whether conducted by the Office of the State Auditor or a certified public accounting (CPA) firm." So CPA firms and the auditors in the State Auditor's office are doing EXACTLY the same work in EXACTLY the same way.

Shame on Rebecca Otto for attacking the honesty and independence of CPAs. Sliming others doesn't make you look good.

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Mobility marches on...maybe to Canada

September 26, 2011

New York just became the 48th state to pass mobility when the governor signed the bill August 17. Washington DC also joined the group when their city council passed the law on Sept. 20 (The mayor has indicated he will sign it. It then goes to Congress for review).

Guess who might join the mobility parade in the not-too-distant future? Canada! This gets a bit complex, so bear with me.

A proposal has been put forth to unify the accounting profession in Canada. Canada currently has three types of accountants: Chartered Accountants, Certified Management Accountants and Certified General Accountants. At first the existing CA, CMA and CGA designations will be combined with the new “CPA”, Chartered Professional Accountant. Then after a transition period (approximately 10 years) just CPA will be used.

It may take awhile to implement, but it isn’t unreasonable to think that mobility with Canada could become a reality after unification has taken place.

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How to know if you're loved

August 30, 2011
Betsy the calf

I’m off to the farm again for the final “big” vacation of the summer. It got me to thinking about how lucky I am to have great neighbors out there, particularly, Ted, who has a cattle farm just to the north of me.

Ted raises Black Angus cattle. His specialty is breeding the best and selling them to others. Ted is a big, tall man, about 74 years old, and the best friend a city girl could have. When I first met him four years ago, he crossed his arms, rocked back and forth a few times, looked down at me and said, “Well, I hope you like cows.” Fortunately, I do like cows – a lot! I even like them when the roving adolescent boy cow gang sneaks under the electric fence and decides my pasture tastes best. Bon appétit!

The ultimate thrill came when Ted asked permission to name one of his babies after me a couple of years ago. So meet Betsy – in all her adorable cuteness. In another year or two she’ll be ready to have her own baby and I’ll have a Grandcow. How amazingly cool is that?

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For-Profit Colleges - the continuing saga

August 16, 2011
Some time ago I wrote a post about for-profit colleges questioning their place in accounting education. Now there is some news to share about the Dept. of Justice and four states (Illinois, Indiana, California and Florida) filing a huge suit against the Education Management Corporation, the second largest for-profit college company.

The suit claims that EMC is not eligible for the $11 billion in state and federal financial aid it received from 2003 – 2011. Specifically, the company consistently violated federal law by paying recruiters based on how many students they enrolled.

EMC enrolls about 150,000 students operating under four names: Argosy University, Art Institute, Brown Mackie College and South University (Argosy has a building in Eagan. The Art Institutes International Minnesota has an address of 15 S. 9th Street in Minneapolis).

The complaint alleges that recruiters were pressured to enroll students regardless of their qualifications in order to claim the student loan money that those students would bring to the school.

I believe that this story will continue to unfold, and that more for-profit schools will fall under scrutiny. I’ll keep you updated.

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Financial literacy websites

August 11, 2011
pig

I thought I’d do a little web surfing and see what I could come up with in terms of websites that are particularly useful as sites for “regular folks” who want to learn more about finances or solve a particular problem they have. Here are three I found, with a brief review for each:

SmartAboutMoney.org
The information on this site is well organized into sections such as, “Life Events & Financial Decisions”. There’s also a section on “Major Life Events” (marriage, moving in with a partner, buying a house, having children, divorce, remarriage...) and a section on “Education and Careers” that includes information on Military Service and Your Finances. The site has forums where you can post questions and when I checked the forums were quite active. There’s also a Resource Library where you can download booklets and brochures on various topics. Plus there are assorted easy-to-use financial calculators. This sight is sponsored by the National Endowment for Financial Education. All in all a very user friendly site.

LearnVest.com
Here’s a site that is targeted to young women in their twenties and thirties and it is slick! The sight looks like a stylish magazine (Elle or Glamour etc.) You create an account and set financial goals. You set up a Financial Action Plan and you can use tools to help with budgeting. There are special “Bootcamps” that cover Personal Financial Basics, Get out of Debt, Cut Your Costs, and Build Your Wealth. You’ll get all the basics at this site (calculators, mortgages, taxes, car loans, credit cards, investing etc.) plus up-to-date and trendy articles on living frugally related to style and beauty, home and décor, entertainment, travel, love & money. Where else are you going to find information on “The 11 Most Expensive Dog Breeds” when you’re thinking about a puppy? (My easy suggestion – adopt from a shelter!) I think this site is great for its target audience.

Financialliteracymusic.com
This was a new one for me. Johnny Deas is the educator/entertainer/author/speaker who has hit upon a unique way to connect financial literacy education to young people. There’s a whole curriculum here plus the songs. Who knew that hip-hop could be harnessed to teach financial literacy? As one of the testimonials states “It’s definitely funky; never in a million years did I imagine I could jam to a song on budgeting!”

Do you have favorite financial literacy sites that you recommend? Let me know.

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I have to admit that I love this!

August 5, 2011

I have to admit that I love this! And what is “this”, you ask?

Planking

It's planking!

Want to see more planking? Check out this video!

So do your best plank, take a photo and send it to me at badrian@mncpa.org and I’ll post them in an upcoming blog. Can’t wait!

P.S. You know you want to do it!

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Financial literacy tests

August 1, 2011
Financial literacy test

If you’re like me you’re a sucker for those quizzes in magazines that ask you to test your knowledge of just about anything from compatibility with your significant other to “Ten True and False Questions about Organic Foods”. You won’t be surprised to know that there are lots and lots of financial literacy quizzes out there. Here are a couple of recent ones:

You also won’t be surprised that there is a lot of bemoaning of how few people can pass a simple one. It’s a significant problem because for about 30 years we have been shifting responsibility for financial decisions onto individuals. In the past, the government and employers often made these decisions for households by providing health insurance, defined benefit pension plans and social security. At the same time, financial decisions have gotten more complex and there is a much wider range of product options sold by more and more companies.

One idea that has been proposed is the use of default options. For example, a couple of years ago we switched the MNCPA 401K plan to an “opt out”. You’re automatically in unless you make the effort to opt out. It’s also been proposed that there be a default option for home mortgages (the so-called “plain vanilla” product).

What do you think about default options? Are they useful?

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Interesting notes about accounting careers

July 29, 2011
Accounting career stats

I recently compiled some current information about accounting careers to give to high school teachers who were being trained to teach college level accounting to their students. I thought I’d share them with you.

  • From 2008 -2018, U.S. Dept of Labor predicts an 22% growth in accounting jobs = 279,400 jobs
  • Those who have earned professional recognition through certification or licensure, especially a CPA, should enjoy the best prospects. (Dept. of Labor 2010-11)
  • Applicants with a master's degree in accounting or a master's degree in business administration with a concentration in accounting also may have an advantage. (Dept. of Labor 2010-11)
    • Nearly four in 10 accounting graduates hired last year by CPA firms had master's degrees, compared with 26 percent in 2008.
    • By contrast, 43 percent of graduates hired had bachelor's degrees, down from 56 percent in 2008.
  • Accounting is the #1 declared major in colleges today.
  • Nationwide, over 20,000 graduates join the Big 4 firms in entry level jobs each year.
  • In 2010 accounting hired the most grads of any sector.
    • Average national starting salary - $50,371
  • Newly minted accountants in 2011 have some of the brightest job prospects in the nation:
    • 90 percent of accounting firms forecast the same or increased hiring of graduates this year compared with 2010,
    • 71 percent, of the largest firms anticipate more hiring
  • Corporate hiring is rebounding more slowly at the entry level.
    • However, hiring of analysts and managers with 5-7 years experience is up.
  • U.S. News and World Report – Fifty Best Careers in 2011
    • Accountant is No. 1

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Financial literacy programs around the country

July 25, 2011
Gov. Patrick

Governor Patrick signing “An Act Establishing a Financial Literacy Trust Fund”.

Some states require that financial literacy be included in school curricula (South Carolina, Oklahoma, Virginia are examples). Other states have taken a different approach. Massachusetts is an interesting case that I’d like to share with you.

The state legislature created a Financial Literacy Trust Fund in April 2011, housed under the State Treasurer. The purpose is to fund programs that help residents, businesses, educational institutions and community groups become financially literate. It’s governed by a 20 member board. (Right now the fund has no funds. The money will come from private contributions, public and private grants and government appropriations. The board is currently operating as a non-profit and setting up bylaws and fundraising rules.)

As an association executive, I am pretty skeptical of such a large board size, but hey, it’s a start. It’s noteworthy that they are taking a broad approach to raising funds, which is probably good.

What do you think about this kind of effort? Would it be a good idea in Minnesota? If so, what role should the MNCPA play? Let me know what you think.

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