New accountants in New Jersey have to undertake an orientation program if they plan to acquire Certified Public Accountant (CPA) permits. They must begin the program within six months of being qualified as an accountant. The proposal was instigated by the New Jersey Society of CPAs, and New Jersey Governor Jon Corzine just signed it into law.
The New Jersey State Board of Accountancy will decide on the syllabus. Lessons on New Jersey ethics and law are likely to be a part of the syllabus. Currently, if qualified three years or less, CPAs have to go through 120 hours of ongoing education. The courses address record-retention policies, disciplinary issues, the fees levied on CPAs, and other topics.
Accounting board approves Sarbanes-Oxley amendments
An auditing measure proposed by Public Company Accounting Oversight Board has been sanctioned by the SEC. The proposal emphasizes that firms keep internal control over financial reporting, identifying four chief sections of IT controls. The controls include computer operations, program development, program changes, and access to programs and data. Company Accounting Oversight Board is a non-profit private company recognized by the Sarbanes-Oxley Act. This move is implied to save time and simplify the hurdles created by the Sarbanes-Oxley Act. The five-member board approved the plan undisputedly, directing accounting companies to keep the supposedly important audits of financial control at the centre of planning. At 59 pages, the Board's new standard is only one-third the size of the standard it replaces.
Large business to apply for ETAAC membership by 6 June
The Internal Revenue Service is looking for large businesses that file annual corporation or partnership returns to become members of ETAAC. The firms will qualify for membership only if they have assets greater than $10 million. Their experience will be useful to the IRS as it moves from paper to electronic filing. The Electronic Tax Administration Advisory Committee studies the issues relating to electronic filing of tax returns, and makes recommendation on them. It provides inputs for improvising upon the electronic tax administration. The 13-member committee provides a structured platform for discussing electronic tax administration issues. This platform supports the electronic filing of annual returns, the most preferred method.
Appeals court upheld the conviction of John Rigas
John Rigas, founder of Adelphia Communications Corp., was found guilty on charges of securities fraud. The 2nd Circuit Court of Appeals upheld the conviction and sentenced him to 15 years in prison. His son Timothy Rigas, the company's former CFO, was sentenced to 20 years. Adelphia was one of the largest cable television companies, serving more than five million customers in 31 states. Adelphia went into bankruptcy on disclosure of a $2.3 million off-balance-sheet debt. The government said the Rigases used the money from their business for personal luxuries. Time Warner Cable, a subsidiary of Time Warner, Inc., has acquired the assets of the company.
Former CFO sentenced to 10 years in prison for wire fraud
The judge Rebecca R. Pallmeyer, after sentencing John Brincat, the chief executive officer of Mercury Finance Co., to prison for 10 years, ordered him to get treatment for gambling and alcohol problems. Three other executives of the company were party to this fraud. Brincat admitted that he withheld the truth to hide the company's huge losses. The money to be recovered from him is to be used to pay compensation to investors who lost $2 billion a decade ago with the fall of the company. The "cookie jar" funds kept in reserve to hide the losses of the company were misappropriated. When the scheme failed, the fraud came to light. The company fielded loans to sub-prime and higher-risk borrowers.