WC Varones

Don't lend your hand to raise no flag atop no ship of fools

Why Capital is Doomed (It's the Financials, Stupid)


Damnit, I haven't had to use this picture
since the "stress tests"
it's warranted here. You'll see.



Listen, despite the name (I know, "Jr Deputy Accountant" might be misleading but wtf did you think the "Jr" was?!), I'm not an accountant, I just play one on TV.

I can calculate earnings per share and I've endorsed more than one accounting book. I'm written into an Auditing and Attestation textbook as "Gonzalez and Gonzalez, CPAs" but that's just because my boss isn't that creative. I don't have a CPA, I just train them. I love every second of it and in three years with my company, I've devoured all of it, even the really really boring parts of BEC that delve into variance analysis. zzzzzzz

Anyway. This is worth paying attention to and you don't have to be an accountant to figure out what it means for the rest of America's capital. If we have a snowball's chance in hell of making out of the financial crisis alive, we've got to prove that our financial statements are worthy of investor money. That's it. No one buys it and that's why Ben Bernanke is the only one plugging money into financials that normally wouldn't stand a chance.

Point is, it's really obvious and you don't need three letters after your name to figure out why this might be a problem. OMG! It's, like, material!

But then you have the auditors, like our friends at KPMG, happy to play accomplice to the scam. You may have missed the whole thing about Overstock.com having to restate financials. You might have even missed it when they got "fired" by their former auditors and commenced to bitchfighting. But please, please don't miss KPMG picking up the crumbs and swooping in to "save" Overstock. And you wonder why foreign investors don't want to put a dime (or krona or rupee or WTFever) into us?

When looking for crime it's best to consult with the crooks, that's why JDA endorses our friend, criminal and former Crazy Eddie CFO Sam Antar. Hell, he's been on Overstock's nuts forever and if anyone knows a cooked balance sheet.... He had this to say about KPMG's latest audit client (via Going Concern):

KPMG is taking a client with no management integrity and is well advised to study SAS No. 99 about “Consideration of Fraud in a Financial Statement Audit” regarding the unethical “tone at the top” set by Overstock.com’s unprincipled management team. Every single initial financial report for every reporting period issued by Overstock.com has failed to comply with GAAP and other SEC disclosure rules since the company’s inception. Overstock.com has restated its financial reports two times in the last three years and now is trying to avoid a third restatement of financial reports resulting from its improper use of “cookie jar” reserves to inflate its financial performance from Q4 2008 to Q3 2009.
LOL! Good luck with that, KPMG.

Some other KPMG winners include Citigroup (you can find a full list of banks and their respective auditors here, useful when the s^%t starts hitting the fan, as it were) and that whole UBS tax shelter thing.

Like I said, you don't need the letters to get it. Hell, there aren't even numbers involved, sweartoGod. Obvious. It's the financials, stupid!

0 comments:

Related Posts Plugin for WordPress, Blogger...

Contact Us

e-mail: wcvarones *at* yahoo *dot* com

Blog Archive