He was a leader on the forefront of financial reporting during a time of unprecedented challenge for accounting, auditing, and financial reporting. Born in New York City in 1953 and raised in New Jersey for much of his childhood, his father was a well-known commodities trader who moved the family to Buenos Aires, Argentina when he was fourteen years old. He attended an Anglo-Argentine school built on the English public school model; that led him to England and the University of Manchester where he took a degree in economics, graduating at the top of his class in 1974 with first class honors—and a full head of long hair. During his three years at Manchester, he also studied accounting under the direction of Sir Bryan Carsberg, later Secretary General of the International Accounting Standards Committee, and Professors John Arnold and Tony Hope, all of whom encouraged him to pursue a career in accounting.
Following graduation he joined Price Waterhouse in Manchester, where he qualified as a Chartered Accountant. He reports that the United Kingdom’s low salaries and highly progressive taxes convinced him and his wife, Louise, to move to the United States in 1978. The following year, he joined the Boston office of Coopers & Lybrand and shortly thereafter passed the CPA Exam, winning the Gold Medal for the highest score in Massachusetts and the Elijah Watt Sells Award nationally. In 1980, he was transferred to the national office in New York City where he was immersed in both client engagements and technical research projects. He was named a partner in 1985, becoming its senior technical partner in 1996 and continuing in a similar position at the merged firm of PricewaterhouseCoopers in 1998.
His passion for accounting and for improving the information provided to financial markets led to his appointment in 2002 as Chairman of the Financial Accounting Standards Board, following the term of Edmund L. Jenkins. Enron Corporation had collapsed in a financial reporting scandal , WorldCom would shortly follow, and the Sarbanes-Oxley Act was in the works. The latter led the Securities and Exchange Commission to formally re-designate the FASB as the recognized U.S. accounting standard-setter. The new FASB chairman led a concerted effort to improve and simplify both the standards and the process by which they are developed and to pursue convergence of U.S. and international standards. A central outcome of this effort was the comprehensive reorganization of U.S. accounting standards which brought together in a coherent codification some 2000 individual authoritative pronouncements issued by various organizations and agencies over more than half a century.
A second important outcome was the signing of the “Norwalk Agreement” in October 2002, in which the FASB and the IASB agreed in principle to work toward convergence of their standards. In the years that followed, joint teams made progress on accounting for stock-based compensation, business combinations, financial instruments, consolidations, revenue recognition, lease accounting, financial statement presentation, as well as other standards.
A third among the many important outcomes under this chairman’s watch was the issuance of a major standard to clarify the general meaning of fair value in financial reporting. The new standard described the different techniques for measuring fair value and provided a framework for related disclosure in the financial statements. The new standard was intended to improve fair value reporting in areas where it was already required and to augment long-existing rules on lower-of-cost-or-market and asset impairment and has also now become the basis of the international standard on fair value measurement.
During this period the FASB chairman appeared repeatedly before Congressional committees and was a highly effective spokesman for an independent accounting standard-setting process, free from inappropriate political intervention or override. In addition, he worked extensively with the SEC, the PCAOB, the Treasury Department, other national accounting standard setters, and both U.S. and international bank regulators. Together with his fellow Board members, he enhanced the outreach to investors and the input the FASB receives from investors, small and private companies, not-for-profit entities, and the academic community.
His tenure with the FASB caps a long and extraordinary record of service to his firm, to the accounting profession, to the capital markets, and to the public interest. He served as a founding member of the IASB, a member of the Emerging Issues Task Force, and as chair and member of many other AICPA committees and task forces. He was the first chairman of the Transnational Auditors Committee of the International Federation of Accountants and served as a member of numerous other committees and advisory boards including the New York Stock Exchange International Capital Markets Advisory Committee, various SEC and U.S. Treasury advisory committees, and the Prince of Wales’ International Integrated Reporting Committee.
As an audit partner and leader of his firm’s Corporate Finance Advisory Services, he worked extensively with major corporations, investment banks, and private equity funds. As the senior technical partner of Coopers & Lybrand and PwC , he was responsible for firm policies on accounting, auditing, and professional matters, resolution of client practice issues, risk management and practice quality, and firm publications and communications on accounting , auditing and professional developments . He also served as a member of PwC’s U.S. and Global Boards, and as president of the C&L and PwC Foundations, and as a member of the investment, compensation, finance, and human capital committees.
He has also written extensively on accounting, auditing, finance, and business subjects. He has authored or coauthored five books and monographs and over 40 articles published in professional and academic journals. His books include the influential The Value Reporting Revolution: Moving Beyond the Earnings, coauthored with Robert Eccles, E. Mary Keegan and David Phillips and published in 2001. In addition, he has delivered over 40 invited lectures at universities throughout the United States and in many other countries.
His honors and awards include an honorary doctorate from his alma mater, the University of Manchester, and recognitions of his distinguished contributions to accounting and financial management by many other organizations and institutions.
Currently, he is Executive in Residence on the faculty of Columbia University Business School. In 2011, he joined the Board of Directors of Fannie Mae and serves on their audit , nominating and corporate governance, and strategic initiatives committees and has recently joined the board of directors and audit committee of Morgan Stanley In addition, he serves on many other boards and advisory groups including, the Accounting Standards Oversight Council of Canada, the Financial Reporting Faculty of the Institute of Chartered Accountants in England and Wales, the Standing Advisory Group of the PCAOB, WebFilings LLC , AccountAbility, and the Kessler Foundation
He and his wife, Louise, have two grown children, Michael and Nicole, and live in South Orange, New Jersey where he has participated in civic and school district budgetary administration.
He is the eighty-ninth member of The Accounting Hall of Fame, Robert Henry Herz.