CFA International News - Code #A001
Jeff Diermeier, CFA – CFA Institute President and CEO
August 2006

1- India Court Issues Interim Injunction to End Unauthorized Use of CFA Brands

Vigorously protecting the integrity of the CFA designation obviously is a top priority for CFA Institute. At no time is the CFA designation put in more jeopardy than when it is awarded unlawfully by other organizations. This has been the case in India for some time. As a result, in 1997 CFA Institute filed suit against an organization that called itself the Institute of Chartered Financial Analysts of India (ICFAI) to stop its unauthorized use of our organizational trademarks, including the CFA designation.

Nine years later on the 4th of August, the Delhi High Court issued an interim injunction against the ICFAI to cease its use of CFA Institute marks, dismissing its argument that "CFA" is a generic term to which any organization should be entitled use. Rather, Justice Manju Goel recognized that the CFA designation is a trademark owned exclusively by CFA Institute.

"[I]t is important for [CFA Institute] that these marks are associated with very high standards," said Justice Goel. "If [ICFAI is] allowed to continue using the marks [CFA Institute is] likely to suffer loss in their reputation and such loss may be irreparable."

Interest in the CFA Program in India already is at an all-time high, where more than 3,000 candidates were enrolled for the June 2006 examination and another 930 candidates are enrolled to sit for December's Level I examination.

2- CFA Exam Pass Rates Up from Last Year

For June 2006, the Level I pass rate was 40% (up from 36% in 2005); the Level II pass rate was 48% (down from 56% in 2005); and the Level III pass rate was 76% (up from 55% in 2005)

"We believe this reflects several factors, the most important of which involves better preparation by candidates," said Bob Johnson, CFA, managing director of the CFA and CGIPS Programs Division.

3- CFA Centre and Business Roundtable Issue Report on "Short Termism"

The CFA Centre and the Business Roundtable Institute for Corporate Ethics called on corporate leaders, asset managers, investors, and others to break the "short-term obsession" harming shareholders' interests by reforming practices involving earnings guidance, compensation, and communications to investors. The impact of the report was substantial, and included an article on the front page and a supportive editorial in the Financial Times, as well as CNBC Europe, CNN International, and global coverage through wire service reports.

"The obsession with short-term results by investors, asset management firms, and corporate managers collectively leads to the un-intended consequences of destroying long-term value, which decreases market efficiency, reduces investment returns, and impedes efforts to strengthen corporate governance," the report said. The recommendations included reforms in practices involving earnings guidance, compensation, and investor communications.

"Getting all of the parties involved at the same table led to meaningful progress," said Kurt Schacht, CFA, managing director of the CFA Centre. "The discussions enabled us to construct what we believe are viable, achievable strategic solutions."

4- CFA Centre and Societies Push for Best Practices in Middle East

In complementary efforts, the CFA Centre and our societies in Saudi Arabia and the UAE recently made efforts to bring higher standards of financial disclosure and corporate governance to their nations.

First, a recent article in the Gulf News of the United Arab Emirates highlighted the positions of CFA Emirates: "Zouheir Tamim Al Jarkas, president of CFA Emirates, the local body of (CFA charterholders), said investment analysts in the UAE find it hard to forecast a company's cash flows or evaluate risk, since firms do not disclose adequate and timely information."

Separately, the CFA Centre and our Saudi Arabian society, CFA Arabia, recently submitted a comment letter to the Capital Markets Authority of Saudi Arabia responding to their corporate governance regulations consultation document. "The Centre and CFA Arabia support the approach by the Capital Markets Authority (the "CMA") to seek the views of market participants on matters relating to corporate governance and company law," said the 4 August letter. "These topics cover systems of shareholder ownership and participation, and of the structure, tasks, remuneration and oversight of the governing bodies of companies, which have a significant impact on decision-making and accountability by company executives and board members."

Rumour has it: Accounting is the hippest thing in town  - Code # A002
September 4, 2006
by Christine Fawaz - Regional Marketing Coordinator, Morgan International Offshore

Long gone are the days when accounting was just another dull profession with accountants portrayed as suit-wearing, number crunching, boring types.

According to Chen et al (2002), between 1995 and 2000, the number of students enrolling in accounting programs had declined by 25%. But when Enron hit the front page in 2001, the world of accounting was turned upside down. Literally. Other corporate scandals such as those that have affected the likes of Tyco International and WorldCom were equally held responsible. But how did such negative publicity render the profession more desirable rather than have students shy away in a time when CPAs were in the spotlight for all the wrong reasons? Well, some students definitely thought twice before choosing such a career path whereas others jumped at the opportunity of being in the most talked about profession around.

As a result of these frauds, the then newly implemented Sarbanes-Oxley Act also known as the Public Company Accounting Reform and Investor Protection Act of 2002, spurred a whole new wave of accounting opportunities especially fraud investigation related jobs and thus rendered accounting one of the hottest professions around with words such as ‘cool’, ‘sexy’ and even ‘glamorous’ used to describing the industry. Downright conflicting had these words been used in the same sentence as ‘accounting’ a decade ago…

According to the National Association of Colleges and Employers, accounting majors had toped the list of the most desired job candidates in the United States for the second year in a row in 2005 (Fitzgerald, 2005) and earnings were pretty high with starting salaries of $50,000 per annum in large cities such as New York for college graduates in accounting who had not even earned the CPA designation yet (Sahadi, 2006).  

According to Fitzgerald (2005), ‘firms that audit stockholder-owned companies are poaching certified public accountants with raises, bonuses, a fast track to partnerships and the chance to specialise in particular industries, such as pharmaceuticals – which can groom the CPA to step into a top executive job in that industry’. All this because of tough laws implemented in order to avoid future billion-dollar internal frauds that destroyed the likes of Enron.

Contrary to popular belief, accounting students and CPAs in particular actually have the opportunity to work in the most glamorous industries and hold some of the most fascinating jobs around. Take Derek Ferguson for example. He is the chief financial officer of Bad Boy Records and other businesses related to Sean “Puffy” Combs and according to Dennis (2005), ‘nearly 1,400 of the FBI’s special agents are accountants’. Why? ‘People who have been trained to understand financial records can quickly recognise when the numbers don’t add up, when activity in a bank statement or transactions in a financial statement or a bank account just don’t make sense’ (Dennis, 2005). And that is particularly true when dealing with the large number of crimes committed to make money such as fraud, money laundering and bribery. Now that is cool.

Apart from the present attractiveness of the profession however, it is wise to note that a lot of students choose this career path for the job security aspect of it as firms will always need accountants.

So add up job security, high salaries, prestige and the current sexiness status that comes with accounting and you get a recipe for success. Of course we haven’t mentioned all the downsides: demanding nature of the job, extreme pressure, long hours and frantic travel schedule… but then again, to all future accounting graduates: you’ll have lots of time to figure that out for yourself…

References

Chen C., Jones K. T., McIntyre D. D. (2002), ‘Will Enron deter Students from Majoring in Accounting?’ The CPA Journal, December 2002 http://www.nysscpa.org/cpajournal/2002/1202/nv/nv6.htm  

Dennis A. (2005), ‘Be a Star in Business- Be a CPA’, New Accountant, http://www.newaccountantusa.com/newsFeat/ip/ip_beAstar.html

Fitzgerald B. (2005), ‘Thanks to Corporate Scandals, Accounting Is Now Sexy’, Newhouse News Services http://www.newhousenews.com/archive/fitzgerald072005.html

Sahadi J. (2006), ‘5 Careers: Big demand, big pay’, CnnMoney.com, February 6, 2006.

The IT Opportunity - Code #A003
September 4, 2007
by Christine Fawaz - Regional Marketing Coordinator, Morgan International Offshore

Some things in life never change but the hottest job of the moment is definitely not one of them. So take out your notepads and be sure to write down all the reasons you need to update your CV now and go hunting for a job in Information technology.  

4 good reasons why CPAs should look for a job in the IT sector:

• Because according to Croix (2005), technological accounting jobs are still very much on the rise.

• Because the IT society needs CPA who can bring along computer skills to their accounting jobs that now require the likes of software development and accounting research and design.

• Because if you decide to change employers during your career in this highly technological era, coming in with an experience in IT will definitely give you an advantage over other candidates and open a lot of doors.

• And finally, because you can negotiate a sweet paycheque... You heard that. According to Jeanne Sahadi at CNNMoney.com, accounting and Technology are listed as two of the hottest jobs of the moment with a big demand and an even bigger pay.

References  

Chen C., Jones K. T., McIntyre D. D. (2002), ‘Will Enron deter Students from Majoring in Accounting?’ The CPA Journal, December 2002 http://www.nysscpa.org/cpajournal/2002/1202/nv/nv6.ht

Sahadi J. (2006), ‘5 Careers: Big demand, big pay’, CnnMoney.com, February 6, 2006.

Call for Presenters - Code #A004

Become a part of IMA’s  Annual Global Conference in Dubai May 6-9, 2007.

IMA is currently seeking senior business leaders to present at this leading-edge event.

The Conference offers educational opportunities to management accountants delivering value in the areas of decision support, planning and control.  Topics include leadership strategies, ethics, strategic cost management, enterprise risk and controls, planning and budgeting, and enterprise business reporting among others. . Presentations typically run 75 minutes within a given track, with 10 to 15 minutes of questions and answers. Workshops can range between 75 and 125 minutes with a combination of narrative, case studies, and problem solving. IMA is also open to other format suggestions to make best use of the presenter’s material. If you wish to submit a program idea for one of our educational sessions, please provide three items to jthomson@imanet.org (Jeff Thomson – VP of Research) and jgurowka@imanet.org (James Gurowka – Leader, International Business Development).  The items are:  the speaker’s complete contact information; a session title (short and compelling); and, a proposed session description (100 words or less – compelling, relevant and creative). 

Submissions will be reviewed by the Program Committee, and you will receive notification by November 2006.

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