Did You Know Botticelli Painted Accountants?

A bi-weekly round-up of finance and accounting news.

Oh, to be an accountant back in the day. Way back. Way way back.

That's my takeaway upon reading Bloomberg.com's entertaining Q&A with author Jacob Soll about his new book "The Reckoning: Financial Accountability and the Rise and Fall of Nations."

Don't be daunted by the title. It's easy to see that Soll, a MacArthur Genius Grant recipient, knows how to bring to life the story of the once-heralded stature accountants held in society and their fall from popularity, which caused political shock waves that changed history forever.

For example, did you know Botticelli painted accountants? Or that France might have taken over the world if only Louis the XIV hadn't dumped the whole idea of financial accountability after Colbert died? 

Yes, even the nobles hated being audited – and it often meant the demise of entire nations.

Fraud doesn't pay

Speaking of accountability: The number of accounting-related securities class action lawsuits filed this year is likely to increase, thanks to work underway by the Securities and Exchange Commission’s Financial Reporting and Audit Task Force, which launched last July.

The task force now has several fraud investigations in progress, reports John Kester in a recent blog for the Wall Street Journal.

Accounting cases often result in higher settlements than typical securities class actions. Last year companies paid out more than $1 billion to clear their names, according to a report by Cornerstone Research.

This report is full of interesting statistics, but one that jumps out is that 70 percent of accounting cases filed in 2013 involved allegations of internal control weaknesses, the highest proportion in five years. (For an in-depth look into how your peers are handling internal controls and all other aspects of their operations, check out Robert Half's annual benchmarking survey of finance departments in the United States and Canada.)

SEC Chairwoman Mary Jo White certainly wouldn't have feared King Louis. In 2013 she said the task force aims to make companies "think we are everywhere...focusing on gatekeepers to make them think twice about shirking responsibilities and ensuring that even the small violations face consequences."

Finance careers circa 2014

While accountants may no longer be the subject of Italian masterpieces, a career in finance still offers infinite opportunities to make a difference in the world of business and government. Just consider the new management accounting competency standards announced last week by the Chartered Institute of Management Accountants and the American Institute of Certified Public Accountants.

The organization surveyed employers and other stakeholders around the world to identify a competency framework in 45 areas under four key knowledge areas: technical, business, people and leadership.

For example, expertise is requested in the following: risk management and internal controls, macroeconomic analysis, communication and negotiation, including strategic understanding in a global context. Technical financial competencies include financial accounting and reporting, management reporting and analysis and risk management. The number of competencies and proficiency expected varies by functional area and level of seniority.

Painting skills are, fortunately, optional.

Photo source: http://moreintelligentlife.com/content/arts/art-money

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