Needles and threads, bits and bobs; ADM, Tesla, auditor concentration, and auditor independence
I was traveling last week and reading others work, commenting on it, and thinking about how to get more people to pay attention to the PCAOB, auditor concentration, and auditor independence.
I was so much older then. I am younger than that now. My Back Pages, Bob Dylan.
I went to University of South Carolina last week to speak, first, at a reception for freshmen who had done very well on the first accounting course they’d taken as a business undergraduate and, second, to the Masters of Accounting students about what’s ahead for the profession.
It was a cognitively dissonant exercise for me. In the first instance, the objective was to encourage the freshmen to major in accounting now that they knew they could do it well. I made a few remarks, mostly about my crazy, mixed-up, hybrid career. There were many other more straightforward veteran professionals mingling amongst the 100+ students to answer questions and tell their stories.
In the second instance, the next morning, I provided a more cautionary tale of a profession at a crossroads, dare I say in crisis, facing shortages of accountants, threats from AI and complacent investors, and wracked by one scandal after another from its largest global firms. I wrote on LinkedIn after returning from my winding drive back on Sunday and got a very nice response:
My friend and frequent collaborator Olga Usvyatsky wrote about the ADM accounting issues over at Deep Quarry and mentioned “clawbacks”. The problems are getting a lot of press, including in Chicago where the Tribune Editorial Board is comparing it to Enron. Oh please…
It may seem like ADM is an example of investors reacting to accounting.
Rather, I think it’s a reaction to being brutally surprised and maybe a bit confused. See Lordstown…
