Sas october newsletter

1. Stern Accounting Society
October 2012
Upcoming
Events In The News
according to the Wall Street Journal, there was a
Oct 3 6:00 PM Groupon Appoints New $14.3 million decrease in revenue, and a $30 million
Cupcake Social at Crumbs reduction from operating income in the fourth quar-
Location: Crumbs on 8th St Chief Accounting Officer ter of 2011, Groupon’s first quarter as a public
company. The firm’s auditor, Ernst & Young LLP
Come out to our first social event of
by Xinyun Zhu warned Groupon on its lack of effective financial
the year to mingle with our E-board,
controls, and the online coupon company also ad-
learn about SAS, and enjoy some Groupon appointed Brian Stevens as its new Chief
mitted that “there [was] a material weakness in the
cupcakes! Accounting Officer last month, hoping to improve
design and operating effectiveness of [its] internal
the company’s weak bookkeeping system. Stevens
control over financial reporting.” Investors started to
Oct 11 6:30 - 8:00 PM will report to Groupon CFO Jason Child. Joe Del
question Groupon’s management, causing a huge
Preto, the former Chief Accounting Officer, will
PwC Full Time & Internship slide in its stock price.
keep his position as Vice President and Global
Q&A Session Controller, reporting to Stevens.
Location: KMEC 3-110 Groupon’s second quarter earnings report, released
this August, continued to disappoint investors.
Stevens has a B.S. in Accountancy from the Univer-
Herman Leung, the analyst for Susquehanna Interna-
Oct 12 sity of Illinois at Urbana-Champaign, College of
tional Group, commented that the lack of specificity
Business. Before joining the online deals company,
Catch Me If You Can EY he worked at KPMG LLP for 16 years. According to
in Groupon’s balance sheet made it hard for inves-
Forensics Case Competition tors to see the reality about the firm’s performance.
Groupon’s news release, Stevens worked in KPMG’
Presentation and Reception The reporting for Groupon Goods, a discount retail
s Department of Professional Practice for 5 years,
operation, was especially unclear. The company
Location: TBA and he was on the Financial Accounting Stan-dards
recorded its Goods revenue on a gross basis instead
Board as a practice fellow for 2 years. He was
of a net basis that it used for its other operations, and
promoted to an audit partner in October 2007 and
Oct 12 12:30 PM the cost of Goods inventory remained undisclosed.
maintained the position until August 2012. Accor-
PwC xAct Mission Meeting As a response to the disappointing quarterly report,
ding to a filing with the SEC on September 12,
Groupon’s share price declined 27%, and was 73%
Location: KMEC 4-60 Groupon awarded Stevens 281,030 shares.
below its IPO price $20.
Oct 17 12:30PM Groupon has the need for a new Chief Accounting
In order to improve its messy financial reporting, the
Officer as it has been through a series of accounting
Accounting Concentration company has already added executive members with
controversies since last year when it started pre-
Academic Exploration Series more accounting background, and it believes that its
paring for its initial public offering.
Location: UC-07 new CAO Brian Stevens will further strengthen the
company’s accounting performance.
RSVP @ https://stern.campusgroups. Back in July 2011, 4 months before its IPO, Grou-
com/advising/rsvp?id=101776 pon’s non-GAAP measure of financial performance
raised controversies. The measure is called “Adjus-
ted consolidated segmented operating income” SAS Update
Week of October 22– (Adjusted CSOI). It allows Groupon to discount
October 26 marketing and acquisition costs from its income SAS Point System
SAS Mentorship Program statement. According to the Wall Street Journal, in
Kick-Off the company’s original IPO filing, Groupon suc- Big Four / professional events: 1 point
cessfully eliminated $179.9 million online mar- Co-sponsored events: 2 points
Location: TBA
keting costs in the first quarter of 2011, and it even SAS exclusive events: 3 points
Apply to our mentorship program and
meet your mentoring family at our first took a step further by adding back the amount to its Membership requirements:
event of the year! operating income, making "a $117.1 million loss Freshman Member: 4 points
into an $81.6 million gain". However, as the SEC Active Member: 6 points
reviewed and showed concerns about the controver- Platinum Member: 10 points
sial metric, Groupon decided to stop using the mea-
CONTACT US sure in August 2011. Under the GAAP measure they
are now using, the first and second quarter of 2011 SAS Mentorship Program
Facebook both reported losses. The SAS Mentorship Program is a great opportunity
www.facebook.com/accsoc for underclassmen to explore career paths in
In March 2012, a few months after it went public, accounting and get professional advice. Mentees will
EMAIL Groupon had to revise its first quarterly financial be paired up with senior and junior mentors.
accsoc@stern.nyu.edu results because of the underestimation of expected Upperclassmen are welcome to apply to be mentors.
reserves for refunds. The company allows its cus- The program will be kicking off during the week of
CAMPUSGROUPS tomers to return their purchases through the “Grou- October 22-26!
stern.campusgroups.com/accsoc pon Promise” program. However, the executives Click on the following links to apply:
failed to foresee the sharp rise in refund requests as Mentee Application Mentor Application
the firm increased its high-ticket offers. As a result, http://goo.gl/ElaSX http://goo.gl/PxgCJ