Global Business, Finance, and Accounting Newsletter - June 2009

Dear friends and colleagues,

Welcome to the June 2009 issue of my newsletter featuring selected articles on finance, accounting, audit, fraud, and global business.

I hope you will find value in these articles.

Feel free to contact me in case you require any additional information on the topics discussed below.

With very best regards,
Armando Nuricumbo, CPA, CPC


FINANCE AND ACCOUNTING

Audit Watchdog Group Warns About Starbucks
Research firm Audit Integrity issued a negative report to investors and auditing firms about Starbucks Corp.
http://www.webcpa.com/news/Audit-Watchdog-Group-Warns-Starbucks-50486-1.html?zkPrintable=true

IFRS and Your Tax Practice
International Financial Reporting Standards are coming, and tax advisers need to understand the implications for their clients.
http://www.aicpa.org/pubs/taxadv/may2009/dccurrents.pdf

What next? Ten questions for CFOs
As companies shift their attention from fighting the crisis to getting the most from the recovery, CFOs must keep them focused.
http://www.mckinseyquarterly.com/Corporate_Finance/Capital_Management/What_next_ten_questions_for_CFOs_2360


FRAUD PREVENTION AND DETECTION

The Reasons Fraud Spikes in a Recession
As sure as growth slides and employment numbers tumble, so cases of fraud rise during recessions. This time is no different.
http://www.time.com/time/business/article/0,8599,1899798,00.html

Companies Worried About Anti-Bribery Laws
75% of executives in a recent survey by Deloitte reported increased concern over violating anti-bribery laws such as the FCPA.
http://www.webcpa.com/news/Companies-Worried-Anti-Bribery-Laws-50495-1.html?zkPrintable=true

CAQ Offers Pointers for Integrated Audits of Internal Control
The Center for Audit Quality (CAQ) issued a report highlighting lessons learned from section 404 audits and identifies 21 practical tips.
http://www.journalofaccountancy.com/Web/PointersforAuditsofInternalControl.htm


GLOBAL ECONOMY

The Economist Intelligence Unit – Global Outlook May 2009
The global economy will probably stop deteriorating, but a return to healthy growth remains a distant prospect.
http://graphics.eiu.com/upload/eb/Global_economic_forecast.pdf

Economic Sentiment Cautiously Optimistic: AICPA Survey
Pessimism about the U.S. economy eased in the Second Quarter, according to a new survey conducted by the AICPA.
http://www.aicpa.org/download/news/2009/ECONOMIC_SENTIMENT_TURNS_CAUTIOUSLY_OPTIMISTIC.pdf

The Financial Meltdown's Unhappy Anniversary
The global credit-market meltdown was triggered on June 12, 2007, with the collapse of two Bear Stearns mortgage hedge funds.
http://money.cnn.com/2009/05/15/news/economy/bear.stearns.fortune/index.htm?postversion=2009051512

Risk and regulation: A new era for capitalism
After close to 30 years of light-touch regulation, globalisation and free-markets, many suggest that capitalism itself is entering a new phase.
http://www.eiu.com/site_info.asp?info_name=risk_and_regulation&page=noads&rf=0


MEXICO AND LATIN AMERICA

The Other Mexico: A Wave of investment
Corporations continue pouring billions of dollars in foreign direct investment in this country. Who says Mexico is a failed state?
http://www.nuricumbo.com/files/The_Other_Mexico.pdf

Mexican Data Show Migration to U.S. in Decline
Census data indicate an extraordinary decline in the number of Mexican immigrants going to the United States.
http://www.nytimes.com/2009/05/15/us/15immig.html?_r=1


OTHER MANAGEMENT TOPICS

Sex Sells. Here's Why We Buy
That iPhone in your pocket? That's for sex. As is pretty much everything you've ever bought, from your car to your T shirt.
http://www.time.com/time/health/article/0,8599,1900032,00.html

Confucius' Three Keys To Successful Leadership
Here are three ultimate lessons that business people can derive from Confucius. If anything has ever stood the test of time, they have.
http://www.forbes.com/2009/05/21/confucius-tips-wisdom-leadership-managing-philosophy.html

Test your Knowledge about Technology
CPAs could use this tool to gauge how technology-savvy they really are and pinpoint areas of improvement.
http://www.journalofaccountancy.com/Issues/2009/Jun/20091632.htm


RECOMMENDATIONS

The Horizon Institute
World-class Language School in Montreal, Canada.
http://www.horizoninstitute.ca/en/index.php

"As It Is In Heaven"

Had a great movie experience last night. I saw "As it is in heaven", 2004 Swedish movie that was nominated for Best Foreign Film and won top honors at the Berlinale that year. It's the story of a successful orchestra director that has to retire young due to health problems and ends up conducting his local town choir. "Do not be afraid. Death does not exist" - says Lena close to the end.

Recomendacion

La temporada de conciertos de la Orquesta Filarmónica de la UNAM ha comenzado. Les recomiendo ampliamente el concierto de este fin de semana. Serenata para Violín de Bernstein y la Tercera Sinfonía de Beethoven. Un solista de lujo y precios muy accesibles. La cita es el sábado a las 8pm en la Sala Nezahualcóyotl. Créanme que esta orquesta está cada día mejor.

Campañas Políticas

Comienza nuevamente esa terrible época en nuestras vidas: Las campañas políticas. Anuncios, promesas, acusaciones y alguno que otro político ingenuo que de verdad piensa que alguien, tal vez, en algún lugar, pudiera creerle alguna de sus promesas. Somos una de las democracias más caras del mundo y los resultados no llegan. ¿Este modelo es sustentable?

H1N1 Influenza Update - 3 May 2009

Dear friends,

Hope you are doing well.

Here is an update on the H1N1 virus outbreak from Mexico City, along with some links to other resources dealing with this topic. I hope you will find this information useful for your projects in Mexico and elsewhere.

Current Status as of 3 May 2009
- 18 countries have officially reported 898 cases of influenza A(H1N1) infection.

- Mexico has reported 506 confirmed human cases of infection, including 19 deaths. The following countries have reported laboratory confirmed cases with no deaths - Austria (1), Canada (85), China, Hong Kong Special Administrative Region (1), Costa Rica (1), Denmark (1), France (2), Germany (8), Ireland (1), Israel (3), Italy (1), Netherlands (1), New Zealand (4), Republic of Korea (1), Spain (40), Switzerland (1) and the United Kingdom (15). The only other death outside Mexico was at a 2 year-old Mexican boy at a clinic in Houston, Texas.

- Mexico's health secretary has said that the H1N1 influenza epidemic in Mexico "is now in its declining phase". He said data suggest the epidemic peaked sometime between April 23 and April 28, and that drastic measures — closing the nation's schools, shuttering most of its businesses and banning mass public gatherings — apparently have helped curb the influenza's spread.

- Nestlé, the world’s biggest food group, has banned all non-essential travel by its global executives to the US, as well as to Mexico, reflecting growing concerns among international business at the threat of H1N1 influenza.

- The World Health Organization (WHO) advises no restriction of regular travel or closure of borders. It is considered prudent for people who are ill to delay international travel and for people developing symptoms following international travel to seek medical attention, in line with guidance from national authorities. The WHO considers that limiting travel and imposing travel restrictions would have very little effect on stopping the virus from spreading, but would be highly disruptive to the global community. Scientific research based on mathematical modeling indicates that restricting travel will be of limited or no benefit in stopping the spread of disease. Historical records of previous influenza pandemics, as well as experience with SARS, have validated this point.

- There is no risk of infection from this virus from consumption of well-cooked pork and pork products.

- Smithfield Foods, a Virginia-based producer, denied claims in Mexico that a joint venture it runs in Veracruz was the source of the virus. Its chief executive said in a letter to employees that Mexican authorities had found no evidence of the virus at their farm and that the results of further independent tests would be available and released by the company in a few days.

- President Barack Obama asked Congress for $1.5bn to combat H1N1 influenza. His request came after a Senate committee heard that the disease was expected to spread and that cases might become more severe than the mild ones so far identified in the US.

- According to the U.S. Centers for Disease Control and Prevention (CDC), the strain of human H1N1 influenza reported in North America is a new virus, "unique because it is a combination of genes from swine, bird, and human influenza viruses. Infected individuals report flu-like symptoms of fever, aches and pains, sore throats, coughing, and trouble breathing. Some people have also reported diarrhea and vomiting."

- The WHO noted, "There are no vaccines that contain the current H1N1 influenza virus causing illness in humans. It is not known whether current human seasonal influenza vaccines can provide any protection."

- But the WHO site also pointed out, "Most of the previously reported H1N1 influenza cases recovered fully from the disease without requiring medical attention and without antiviral medicines."

Other resources
Key Facts About Swine Influenza
US Centers for Disease Control and Prevention
http://www.cdc.gov/h1n1flu/key_facts.htm

Things you can do to stay healthy
US Centers for Disease Control and Prevention
http://www.cdc.gov/h1n1flu/#stay_healthy

H1N1 Outbreak in US & Mexico: Potential for a Pandemic.
University of Pittsburgh.
http://www.pitt.edu/~super1/lecture/lec34601/index.htm

Five Things You Should Not Do During the H1N1 Outbreak
Time Magazine
http://www.time.com/time/health/article/0,8599,1895216,00.html


Please keep well and let me know if there is anything I can do to help minimize the impact of this crisis on your business operations in Mexico.

Mexico's Monetary Response to the Crisis