Spring 2008 issue of Terry Magazine - (Page 30)

Some might say he is the smartest accountant in the world . . . you would never know that he knows more than you'll ever learn when dealing with him. and institutional investors sent numerous requests to the board after the market meltdown and corporate reporting scandals “to mandate the expensing of compensation cost relating to employee stock options” — thereby prompting the FASB to revisit the issue that the government pressured them to table nearly a decade earlier. It was ironic, yet not surprising, when WorldCom called on Beresford to help fix things when their mammoth accounting fraud nearly derailed the company. “He was the first new board member,” says Cynthia Cooper, former vice president for internal audit at WorldCom, who was the chief whistleblower. “He became immediately engaged with my internal audit team. He was there when the company was at an alltime low. He took on a significant risk and responsibility that also required a substantial time commitment.” A financial restatement is an exhaustive process that involves creating sound accounting policies and reconstructing facts and company history in order to develop financial statements that are consistent with new policies. WorldCom spent $350 million to reconstruct $80 billion worth of acquisitions and to address more than 100 accounting issues that required 650 outside employees to retrace board minutes, company records, and extensive forensic accounting. And all the while, they had to maintain regular communication with the SEC to keep the government satisfied with the company’s financial restatement efforts. This is where an audit committee chairman becomes a vital asset in reviewing the policies, drafting the appropriate government paperwork, and providing guidance to executive management. “It’s a signal to the market that the old days are gone and now we’ve returned to high standards — and you can trust our financial statements,” says Terry accounting professor and IBM program director Dave Harvey. “Denny is one of the people that send that signal . . . there aren’t too many.” Beresford currently serves on the corporate boards of Fannie Mae, Legg-Mason, and Kimberly-Clark, and former WorldComMCI and Fannie Mae CFO Bob Blakely can’t say enough about his audit committee chairman. “He’s very collegial . . . very open, very hard-working, and very thorough in his analysis,” says Blakely, who paired with Beresford to reconstruct the financial statements of WorldCom and later Fannie Mae in 2006. “He’d roll up his sleeves with us. One of the important ingredients for me considering whether to take the WorldCom job — with the condition the company was in [in 2003] — was the fact Denny was there as chairman of the audit committee. He’s great to work with and I have tremendous respect for him. He’s been an 30 • Spring 2008 asset at WorldCom. He’s been an asset at Fannie Mae. And I think if you look at the leadership in the accounting profession in this country, he’s right up there at the top.” Al Hazard, the lead audit and relationship partner for Deloitte & Touche on the Fannie Mae engagement, describes what makes Denny such a great leader in an advisory role. “A most important aspect that I have seen from Denny is his ability to stay the course, stay calm, always be polite, and always be a gentleman,” says Hazard. “Some might say he is the smartest accountant in the world, at least if you look at his credentials — chairman of the Financial Accounting Standards Board, member of the International Accounting Standards Board, frequently asked by politicians and regulators to provide advice or to sit on or guide commissions or committees to deal with complex issues on the financial reporting or auditing world. I mean, the PCAOB, the SEC, the Fed, he’s constantly sought out for a variety of reasons for his advice. “It’s one thing to have the credentials or to be in that league of capability. It’s another thing to be able to deploy that expertise in a non-assuming, effective way. When you’re working with Denny you never feel trod upon, you never feel threatened, you’re always put at ease, and you would never know that he knows more than you’ll ever learn when dealing with him.” Beresford’s unpretentious style is equally evident in the classroom. In the accounting policy course that he teaches at Terry, he frequently leads discussions on current events gleaned from students’ prescribed readings of the Wall Street Journal — with a special focus on the way major business events impact the accounting profession and vice versa. “It was intimidating coming into the class — just knowing his background — but it’s a very open environment, it’s not scary,” says MAcc student Courtney Stillwagon, who has just listened to Beresford dissect the recent probe into trading losses at the French Bank Société Générale, followed by a discussion of the pros and cons of the FASB’s relationship with the SEC. “You can’t ask most of your professors, ‘How did you interact with the SEC?’” says Stillwagon. “That’s huge.” Ernst & Young accountant Michael Barrett (MAcc ’02) recalls an unusually exciting graduate assistantship that he served under Beresford. “When I first started working with him, he was ‘only’ the former chairman of the FASB,” says Barrett, who was being mentored by Beresford as the corporate scandals broke. “My second year is when he turned into more of a rock star. I would suddenly see my boss Terry College of BuSineSS

Table of Contents Feed for the Digital Edition of Terry School of Business - Spring 2008

Terry School of Business - Spring 2008 Contents Quick Bites Research & Innovation Gatherings Best CEO in America An Unlikely Rock Star Fire & Flavor Beyond the Bench Terry Memo Economic Scorekeeper Class Notes

Terry School of Business - Spring 2008

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