July 2007

Indian Chartered Accountants: 12,000 on Orkut

July 23, 2007 Innovation

While I spend a lot of time on Facebook and perhaps too much time talking about it, I’d entirely missed Robert Scoble’s exhortation to Google about getting Orkut into shape…. This is what Robert said about Orkut:Google has the best mobile app on my mobile phone too. Maps, if you’re on the iPhone, but if you’re on Nokia the Mobile Google app suite is really great…. All of which would really benefit from having a Google Identity System.So, could Google redesign Orkut, make it nice looking and functional (one of Facebook’s greatest attributes) which would appeal to people like me who are looking for the next shiny thing to use functional identity system and application delivery platform that gets everyone excited.Yes. And if Google got it’s act together on issues like Open ID (I too am fed up of multiple logins across multiple services) then it would leap frog the competition…. It has taken hold so strongly in India and Brazil, I wonder why Google hasn’t done more to promote it in North America and Europe.Precisely…. More to the point, I wonder how long it will be before someone somewhere develops an open platform (ie anyone can add apps) that is tailored for the business community. While all attention is on Facebook as a consumer platform, the business market is way bigger by value.

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Checking our ordinariness on Facebook

July 22, 2007 Innovation

Keeping with the Canadian theme from my last post, the early Canadian take-up on Facebook when it opened its doors to all outstripped that of the US. There’s some interesting stuff going on as Neil McIntyre notes: Recruiters are taking advantage of the clustering of Toronto accountants, as this screen grab [if you don't have an FB account] from the Chartered Accountants of Canada [FB] group shows. The CAC FB group has 489 members (including me cos it’s open) and a solid range of officers…. The closest ‘we’ come is: BADCASS – Bristol and District Chartered Accountants’ Student Society with 96 members…. The wee devil inside me hopes that one day, we’ll see a group where the Chartered bit gets dropped ;) I like the way these people are self-organising. There’s not a huge amount of activity but what there is provides interest and insight. From an outsider’s perspective, BADCASS in particular shows there is a human side to the profession that’s rarely recognised. For instance, Paula Thornton chose to stereotype me (and by implication us) yet groups like BADCASS show that despite the stereotypical view, professionals are no different to anyone else…. In order to see what’s going on with Facebook, you’ve got to become a member.

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Let the numbers tell the story

July 22, 2007 Innovation

Sometimes I’m so enamoured of what technology and different business practices can do for professionals that I lose sight of the easy stuff around which to innovate…. If you can’t be bothered, I’ll give you a teaser: From How Things Look:I was working with a not for profit trade association to re-energize their accounting system. The accountant said that the Board was always criticizing the amount that was spent on consultants. We looked at the financial statements and there it was: a single line called “Consulting” with a large number beside it.”It’s so unfair,” the accountant continued. “The Board knows that most of that expense is for the speakers we bring in to do seminars and their cost is covered by participant fees.”"Then let’s get the financial statements to tell the same story,” I said.How did they do it?… Or how about this, entitled: Not For Profit Red Flags: …many NFP’s are a microcosm of larger Canadian issues, such as west vs. east, rural vs. urban, English vs. French, individual vs. large corporation, and you have to ensure that all of the constituents are fairly represented. Financial reporting can be critical in demonstrating that the organization’s resources are being deployed in an even handed manner.Bill’s really talking about story telling…. If you think about Bill’s ideas, they represent social innovation at a readily understood level using the numbers as valuable social objects that communicate the story.

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Deriving fair value

July 22, 2007 Innovation

CFO.com’s article, Bearing It All: The perils of derivatives and fair-value accounting is depressing…. While acknowledging the problems, it doesn’t provide a satisfactory answer, concluding that:Fair value is perhaps most worrying for auditors, who are often blamed for faulty accounts…. Those who remember the ill-fated IR39 will know that is was heavily amended largely because auditors understood the valuation problems…. It doesn’t take much thinking to realise that under the prudence rule, a bet has no value. The way IR39 was phrased, auditors would have been forced to make all sorts of assumptions, coming up with opinions that could be wildly inaccurate yet readily defensible…. I believe this issue could be readily solved by simply declaring that derivatives have no intrinsic value under the prudence rule, citing Bear Stearns experience as a proof…. From the same CFO article:Unfortunately, the alternatives to fair-value accounting can be worse…. But as Bob Herz, chairman of America’s Financial Accounting Standards Board, points out, it too is “replete with all sorts of guesses”, such as depreciation rates.

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ICAEW responds to Frosty reception

July 21, 2007 General

His ICAEW blog (if you can find it) is a committee affair – a fake if you will – this response shines for the difference in tone…. He’s also right to repeat the problems he experienced in getting any help from ICAEW in his efforts to get elected to the vacant Croydon council seat. However, it would have been good to see Ken loudly applaud Michael for agreeing to meet rather than nit picking over the mode of communication. It’s not every day that the ICAEW’s CEO offers to entertain a well known and vociferous critic…. ICAEW’s image is less than well burnished and despite Ken’s admonition to retain the brand identity, he also knows that has to come with authority, something ICAEW lacks. ICAEW’s PR and communications department is not the best in the world as Ken amply demonstrates:I received a call on the 20th from AccountingWeb, alerting me about Michael’s blog. They said that they has suggested to the ICAEW Director of Communications that Michael and I could do a 10 minute podcast, to discuss the issues raised.The offer was rejected by the ICAEW.Some hours later after the call, and one day after Michael’s blog post, I was sent an email from the Director of Communications of the ICAEW asking if I would be amenable to a meeting “our Chief Executive”; thus trying to shut the stable door after the horse has bolted.If I was in Michael’s shoes I would have rejected the podcast offer…. If I was in Ken’s shoes, I’d take up the offer on condition that I have the opportunity to record and recount the conversation, subject to any issues of obvious confidentiality.

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More Big Four pressure

July 21, 2007 Tax and Ethics

They argue that biggest is best from the perspective of providing the high-quality, globally spread resources with which to trawl the books of the largest companies, and the capital base with which to absorb the attendant risks.Intelligent observers are not impressed with this level of spin. Francine McKenna notes in comments to my previous post on the Big Four:My blog should not be the one to come up first when someone Googles Auditing Standard 5…And neither should mine come in at #2 when you run the Google search term: ‘big four ethics.’… Again nothing from the Big Four.In a discussion around my last post, A Counting School posits:My next project should probably be to dislodge Francine’s #2 position in Google searches for Auditing Standard #5…. But then perhaps Francince is right when she says:They’re having to make big investments in technology now to respond to the demands of being a regulated industry. The amount of data that the PCAOB inspectors (and the lawyers that are suing the firms) are requesting and the level of reporting the regulators expect them to have for their “franchises” is something new…. If you believe: That the world of blogs is worthy as an alternative to other forms of media A source of genuine influence and A source of alternative authority thenOne has to wonder whether the Big Four won’t implode simply because of their technology laggardness…. If you think that’s flippant then consider this: In a recent client engagement at a very well known organisation, this was precisely the argument I used when discussing a specific strategy…. As Margaret Mead, one of the truly great social anthropologists and inspirational voices in early feminism once said:Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.Big Four?

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Predicting the end of the Big Four

July 20, 2007 General

His thesis suggests that the way they have developed since the 1980s with an emphasis on sales success as the route to partnership coupled to moribund IT systems leaves them exposed:In a revenue driven environment only the truly visionary will make the right choices more often than the wrong ones – and the promotion criteria currently in force winnow down the number of visionaries remaining in the firms. As a result their technology deployment choices have left them in danger of becoming hollow men – emptied of exactly the characteristics investors around the world depend on them for: the independence, integrity, and business judgement of experienced accounting professionals.I’m not sure Paul is entirely correct…. And despite the continuing stream of lawsuits and bad PR, they have successfully persuaded regulators that a further reduction in the the number of firms at the top would have a destabilizing effect on industry. If you consider what happened in the recent KPMG partners’ fraud trial, you could argue that at one level, they skillfully manipulated a way of ensuring that a potential embarrassment became an acquittal…. And on and on. Even if the Big Four implode, does that mean the profession would be in any better position and, crucially, that clients would be better served? The major flaw in Paul’s argument is that an implosion would bring forward firms that are implicitly better placed as innovators and visionaries…. And in any event, as we saw after the Anderson collapse, the firm’s partners quickly ‘sold’ their portfolios into what we know see as the Big Four in a New York minute. Nevertheless, there is no doubting that the Big Four have made precious little headway in their ability to conduct reliable audits and one has to wonder how long it will be before there is a genuine crisis of confidence.

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Twitter, Pownce, Jaiku – choose wisely

July 20, 2007 Innovation

They all have issues – in some cases to do with the software, in other cases the way people are using them…. But on the public internet, do I really need to know that Joe Blogs has written his/her next post?… Worse still are those who mislead you into believing they’re about to reveal some stonking truth when in fact they’re linking to an article they happen to believe deserves attention…. Publishers have been quick to realise they can link articles to Twitter and in that sense, Twitter acts like a selected RSS feed…. The desktop version looks slick but when accompanied by email alerts that demand I sign in to find out the latest ‘message’ – it quickly becomes an email pollutant. Unlike Twitter, I can create private groups to ensure that only the people I want receive notifications…. I so wish to want to understand what Jaiku delivers.But at the end of the day very few of my colleagues are using the service so presumably it either hasn’t hit big time, others don’t get it either or it just isn’t that useful. As a time starved worker, I need instant appeal and near instant understanding.Bottom LineTwitter is irritating at all sorts of levels and is plain ugly.

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Grade A nonsense

July 20, 2007 Asides

Burt then I wouldn’t expect much else. You decide.

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Bigging it up for Thomas Otter

July 20, 2007 General

Thomas Otter qualifies as one of the most passionate software reps I know. He defends his company tooth and nail as any person would (and should.)… When his company doesn’t do things he thinks are right for customers, he comes out and says so. Not in a snarky (I’m hard done by ‘cos you don’t listen to me) way but in a considered and well argued fashion…. Oft-times we argue like cat and dog.Do I respect Thomas for what he does?… What I can say is that if he was on the other side of the negotiating table I am much more likely to believe his statements…. Because I can test what he says in negotiation against what he says in the public domain…. How many other software vendors can say the same thing?

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