Cover of “American Kingpin” from Amazon. Used under fair use.
The sad tale of Ross Ulbricht and his on-line drug bazaar called Silk Road is a good study of the outer limits of how far rationalization can carry a person.
It is also a frightening illustration of Jeremiah 17:9. From the New International Version, ponder:
The heart is deceitful above all thing and beyond cure. Who can understand it?
Considering the tale of Silk Road is useful for accountants wanting to learn about the outer fringe of the internet and he investigative power of the federal government, believers who would like an illustration of the frightening level of deceit that lives in the human heart, and anyone else wanting to learn more about the dark worlds that normal people will never see.
My posts are gathered into two collections on my other blog, Outrun Change:
Several recent articles provide more background on Bitcoin and other blockchain tools. For your daily brain stretching:
Blockchain as a possible tool for fast and cheap international payments
China is working to restrict blockchain transactions
Central banks ponder issuing of their own virtual currencies
Tax status of blockchain transactions and the IRS is out fishing for tax evaders
Description of blockchain as being the internet of money, comparable to how the internet moves and stores information
8/28/17 – Journal of Accountancy – Blockchain opens new era for cross-border payments– Moving money from one country to another is time-consuming and costly. There are fees at both ends. It takes several days for the money to arrive. An error in one digit of the routing or account information means the transfer will go astray and take more time and money to locate.
Blockchain offers the opportunity to make international transfers near immediate and at a fraction of the cost.
For an illustration, picture a company paying international vendors. Or an international worker sending part of his paycheck back to his parents in his home country. Or a mission organization moving funds to its many field offices.
The Winter 2017 Update newsletter (#83) from the California Board of Accountancy shows that the board is continuing its active efforts on disciplinary actions.
There are obviously quite a few of our colleagues who are not performing up to standards.
I’ve heard stories from a distance that the Board has hired more enforcement staff. As I have read the last few issues of Update, it sure seems to me that the increased staffing is showing up in an increased pace of closed cases. Maybe my perception is off, but it seems there are more cases closed with more serious consequences in the last year or so.
I count 39 cases documented in this edition of Update. Only 2 of these have discipline level of suspension or less. All the others are surrenders, revocations, or stayed revocations. Just as a guess, I think that means the editor of Update is filtering out most of the suspensions.
I count 19 cases of those 39 with peer review problems or audit, review, or compilation failures or some combination thereof. I’ll break that down further:
On 9/11/17 I watched FASB’s one hour webcast on the exposure draft. This is only the second time I’ve seen a presentation on the issue and I haven’t yet dived into the 51 page document. That means I’m just starting to understand the changes.
What I’m going to do here is give a high level introduction. Keep in mind this is just an overview without all the details. Furthermore it is my preliminary understanding after having only heard the presentation twice and looking at the slide deck once. Please don’t cite this in your workpapers!
This exposure draft does not call for any change in how transactions are presented in the statement of activities. Organizations can present particular transactions as either revenue or contributions as they wish. The point was made several times in the presentation that the rules spelled out here determine which model is used for recognizing a transaction, not what presentation is used on the statement of activity.
There is a fantastic graph in the slide deck that provides a good visualization of the current and proposed accounting. It is copyrighted and thus I won’t be presenting it here. I’m sure you’ll be seeing the graphic before you get very far into your study.
Here’s a breakout of how exchange transactions are currently handled. These are also called reciprocal transactions. Currently we think of these as revenue, although the verbal comments in the presentation indicate that is no longer necessarily how exchange transactions must be presented.
Photo at Wells Fargo San Diego museum in October 2016 by James Ulvog.
When I look at the news about Wells Fargo over the last few months, it is amazing to see the number of individual messes the bank has and the amount of time it is taking to get past the issues. Also odd is that new issues are surfacing every month or two. Here are a few articles that I notices in the last month:
8/15/17 – Emily Glazer at Wall Street Journal – Wells Fargo Elevates Former Fed Governor Elizabeth Duke to Chairman Role – As was previously expected (and reported by Ms. Glazer), the bank will replace its current board chair with the former Federal Reserve governor. This is not as big a deal as it would otherwise seem. The current board chair would have hit the bank’s mandatory retirement age four months later anyway.
The proposed new overtime rules that would have required overtime pay for anyone earning less than $47,476 a year will not go into effect. I do not know if any parties will try to file an appeal, but doesn’t seem to me that is very likely.
The federal judge who issued a temporary injunction last fall has issued a final ruling that the proposed rules violate federal law. The reasoning (if I understand a condensed explanation correctly) is federal law includes a duties test which the proposed rules would essentially make irrelevant.
Article says the current administration is working on a new rule, which would likely set a new dollar threshold, but which would be lower than in the previously proposed rules.
