Rosen Seymour Shapss Martin & Co. Adds Expertise With Merger

New York-based Rosen Seymour Shapss Martin & Co., (FY09 net revenue of $45 million) acquired Kahn, Hoffman & Hochman, of White Plains, N.Y. The firm will operate under the name Kahn Hoffman & Hochman, a division of RSSM LLP. The merger adds an additional 40 accountants to RSSM.

Gary Kahn, Enid Hoffman, Michael Hochman, Richard McGuinness, William Hughes, and Maryann Schugmann joined RSSM as partners. Michael Hochman will be the PIC of the operations in the New City office.

Martin Greenberg, MP of RSSM says, “We look forward to having KH&H’s partners and staff join the RSSM family and making RSSM bigger, better and stronger as the premier accounting firm servicing the tri-state metropolitan area.”

Southern Florida Firm Implodes After Scandal IPA Top 100 Swoops Down To Rescue Key Talent

Coral Gables, Fla.-based Berenfeld, Spritzer, Shechter and Sheer (FY09 estimated net revenue of $26.9 million), the firm that did Scott Rothstein’s taxes, officially closed Dec. 20.

Berenfeld provided tax accounting services for high-profile attorney Scott Rothstein, who pleaded guilty in January 2010 to five federal charges of racketeering, money laundering and fraud in a $1.2 billion Ponzi scheme.

In November, Berenfeld agreed to a $10 million settlement of malpractice lawsuits brought by investors in Rothstein’s Ponzi scheme against the accounting firm, a bank where Rothstein had accounts and other defendants.

According to reports, 14 partners and 100 staff from Berenfeld will be joining Richmond, Va.-based Cherry Bekaert & Holland LLP (FY10 net revenue of $98.4 million) effective immediately.

Joining CB&H are former Berenfeld partners Michael Spritzer, Emery Sheer, Philip Shechter, Marc Berenfeld, Ana Martinez, Madeline Elias, Monte Gordon, Mike Everett, Vicki Simmons-Hinz, Gus Perez, Isabel Goldberg, Bob Bedwell, Jeff Lefcourt and Jack Yesner. nIPA

CPAs Win Exemption From Identity Theft Rules

CPAs are now exempt from new federal requirements for written identity theft protection programs. The Federal Trade Commission’s so-called “red flags rule” requires creditors to develop programs to detect and respond to potential identity theft. The FTC had defined creditors as those who accept payment after services are provided, on a delayed basis. That interpretation covered not only CPAs, but also attorneys, health care providers and other professionals.

The AICPA, American Medical Association and American Bar Association lobbied heavily to change the legislation, which has a Dec. 31 enforcement date. Congress changed the definition of creditor in legislation that President Obama signed Dec. 18. Called the Red Flag Program Clarification Act of 2010, it exempts businesses that “advance funds on behalf of a person for expenses incidental to a service provided.”

Under the new exemption law, the rule only applies to organizations that use consumer reports in connection with credit transactions, provide information to consumer reporting agencies or loan money.

“The AICPA, with help from CPA state societies nationwide, worked tirelessly on this issue,” said AICPA president and CEO Barry Melancon in a statement. “The bill makes clear that CPAs and CPA firms are not classified as ‘creditors’ for the purposes of the Federal Trade Commission’s Red Flags Rule. CPAs and CPA firms often do not receive full payment from clients at the time services are rendered. That is not the same as a financial transaction like a bank loan or a credit card where ID theft is a risk.”

The Marriage Is Over: Newly Merged Top 100 Firm(s) Call It Quits

When Walnut, Calif.-based Moore Stephens Wurth Frazer and Torbet joined forces with Little Rock, Ark.-based Frost, PLLC last year, the new Frazer Frost was born and the future of the combined firm looked bright.

Frazer Frost entered the IPA Top 100 in 2010 at No. 59 with combined net revenues of $48.7 million. Now, 11 months post-merger, the firms have called it quits, according to published sources.

Financialinvestigator.com reported in late November that Frost MP Dan Peregrin said in a prepared statement, “The partners of both firms have been friends for years and believed we could best build our business as one firm. Our combination agreement called for a trial period, which began on Jan. 1, 2010, for us to ‘test the waters’ and we have been operating our businesses under the Frazer Frost, LLP name during this time.”

Peregrin told FI.com that a “culture clash” led to the break-up and, “There [are] a lot of [issues] right now in [Chinese reverse mortgage] practice area and we just felt it would be smarter to wish them luck and stick to our practice areas.” Both firms will resume operations under their previous names, according to reports.

The Moore Stephens Wurth Frazer and Torbet side has been “in hot water for a series of audits in its Chinese reverse-merger client base that appear to defy both common sense and financial probability,” according to FI.com.

The Web site GoingConcern.com posted additional information and the following quote from Citron Research, “If you call Frost today in Arkansas, they answer ‘Frost & Co.’ and say they’re no longer associated with Frazer. Citron spoke to Peregrin and twice he told us that the two firms have gone their own way[s] – but if you call Frazer, they answer ‘Frazer Frost’ and in a brief conversation with Susan Woo, the RINO auditor, she told Citron that Frazer Frost is still an operating entity.”

According to published reports, on December, 20, the SEC fined Moore Stephens Wurth Frazer & Torbet LLP and Kerry Dean Yamagata, one of the firm’s partners $129,500 for “improper professional conduct” in connection with a Chinese energy company accused of accounting fraud.

Yamagata, the partner responsible for the audits, was barred from practicing as an independent accountant for at least two years, according to published SEC reports. The SEC ordered the firm to retain an independent consultant for training in fraud detection, auditor independence and other duties related to auditing functions. It ordered the firm not to accept any new issuer audit clients with operations located in China, Hong Kong or Taiwan for an unspecified time period, according to the statement.

Hein & Assoc. Names New Managing Partner

Denver-based Hein & Associates (FY09 net revenue of $45.8 million) named Brian Mandell-Rice MP.  A former entrepreneur who joined Hein as an audit staff member over 24 years ago, Mandell-Rice is only the third MP in the firm’s 33-year history. Working his way steadily through the ranks, he became PIC of the Denver office two years ago, a role he will continue in for the immediate future while also stepping into his new position.

Mandell-Rice says, “Our firm’s culture is distinct. Like me, many of our employees have a long tenure at Hein, and share core values of teamwork, knowledge sharing, and integrity.  From valuing and nurturing professional growth to supporting philanthropic goals, we try to provide a positive work environment to benefit employees, clients, the community, and the profession.”

Mandell-Rice assumes the MP role from Larry Unruh, who will serve a select group of clients while devoting a significant amount of his time supporting the strategic growth opportunities for the firm by identifying new services, geographies, talent and clients.

Unruh says, “Brian is a thoughtful and well-respected leader. He understands that accounting is a people business, and that teamwork and accessibility are embedded in Hein’s culture. His door has always been open, and will continue to be. That’s just how he operates.”

Wiss & Co. Expands With Acquisitions in N.J.

 Livingston, N.J.-based Wiss & Co. (FY10 net revenue of $27 million) acquired Cust, Dori & Benick of Flemington, N.J. Cust partners, Jack Cust, Bruno Dori, Frank Benick and Mike Petrecca, along with 10 joined Wiss on Jan. 1.

The merger gives Wiss “an even greater presence across the state of N.J. and into the eastern portion of Pa.,” says Jeff Campo, MP, Wiss. “This merger will also enable us to expand our focus on core niche practice areas, such as real estate and construction, while enhancing our capabilities in the sports entertainment arena as well.”

Mauldin & Jenkins Expands Footprint

Atlanta-based Mauldin & Jenkins (FY10 net revenue of $32.5 million) acquired CPA Associates, Bradenton, Fla. and Evers & Fox of Atlanta. M&J’s estimated revenues will be $41 million, with a total of 43 partners and 240 staff.

Jerry Marlar, MP of CPA Associates will remain with the firm as a PIC of M&Js’ Bradenton, Fla., operations. M&J will relocate three partners to the newly acquired Bradenton, office. Evers & Fox brings two partners and seven staff to the deal.

Clifton Acquires IPA Best of the Best Firm

Milwaukee-based Clifton Gunderson (FY10 net revenue of $241 million) acquired Albuquerque-based Meyners + Co. (FY09 net revenue of $10.7 million) on Jan. 1.

Through the combination, five partners will join CG including Cathy Brown, Ben Darwin, Brandon Haines, Georgie Ortiz and Patrick Wilkins, along with 58 Meyners staff.

“We are excited with the many growth opportunities the acquisition of Meyners provides our firm, our clients and our future clients,” says CG CEO Kris McMasters. “For 50 years, [CG] has been providing high quality, exceptional service to our clients, built on a foundation of strong core values – qualities which have remained constant over the last five decades. We are eager to combine these strengths with Meyners to further expand our presence in Albuquerque and help our clients grow and prosper in the future,” she says.

Top 100 Firms Join Forces

High Point, N.C.-based Dixon Hughes (FY10 net revenue of $194 million) and Virginia Beach, Va.,-based Goodman & Company (FY10 net revenue of $87.7 million) announced the merger of their firms effective March 1. The combined firm will be known as Dixon Hughes Goodman LLP and will be headquartered in Charlotte, N.C.

Charles Sams Jr., Chairman of DH, will continue to serve as chairman and Ken Hughes, CEO of DH, will continue to serve as CEO.  Thomas Wilson, MP of Goodman, will become deputy chairman and COO of the firm.

The merger will create a dramatically larger geographic footprint with offices located in Ala., Fla., Ga., Md., N.C., Ohio, S.C., Tenn., Texas, Va., Washington, D.C. and WVa. With more than 1,700 people DHG will be the largest firm based in the Southern U.S. and the 13th largest in the nation.

“This combination will create a larger platform in which we can expand our geographical reach throughout the mid-Atlantic, share core technical resources and anticipate the needs of our clients. We are enthusiastic as we move forward over the coming months,” Sams says.

“This is a tailor-made fit that will benefit the firm, our staff and most importantly, our clients,” says Wilson. “Both organizations will gain increased industry expertise and depth and see new geographic opportunities for growth.  Clients will have broadened access to capital networks and industry best practices, while our employees will see more robust training options, increased opportunities for industry specialization, greater mobility between offices and more challenging client work.”