The Accounting Podcast

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David Leary : Welcome to this special bonus collaboration event episode. We have brought in different parts of earmark, so I'm David from the Accounting podcast. We've brought in Caleb Newquist from the Oh My Fraud podcast and our great producer, Zach, who is um, some of you may have heard us reference him when we're recording before, but Zach is actually in the Television [00:00:30] Academy. Zach is a Hollywood guy. He's a producer. He's a connection. So the three of us are going to take a look at the accountant, talk about it. So all of you listeners can get CPE for this through the earmark app. And the accountant is great because it's an action movie on one hand. But there's all these little accounting things that happen during this movie. And that's what we're going to deep dive into. So welcome, Caleb to the show. Zach, thanks. First time I've recorded a show with you.

Zach : Yeah. Thank you. And also, um, you know, this is a good timing because the accounting two [00:01:00] is coming out on April 25th, which is very soon. So, you know, hopefully listeners can go listen to this. Go catch the new movie.

Caleb Newquist: All right. Yeah. The accountants is a 2016, uh, thriller action thriller. And, uh, the logline is, as a math savant and cooks the books for a new client, the Treasury Department closes in on his activities, and the body count starts to rise. Now, right away, I've. I have a beef with this outline, or I have a beef with this logline, because the [00:01:30] conflation of math and accounting is as old as time, I think. And so, um, I'm it's hilarious that maybe, you know, one of the consulting producers on this movie let him get away with it. But nevertheless, nevertheless, as David mentioned, there's there's lots of accounting. There's a lot of accountant service in this film. There's a lot of like, uh, little dialog, little, little Easter eggs for the accountants. And we're going to talk about them and it's going to be fun. And and the movie is good. And, um, it starred Ben [00:02:00] Affleck, of course, as Christian Wolff. That's the main, uh, main character. Uh, Anna Kendrick has a supporting role. Jk JK Simmons uh, Jon Bernthal uh, it's really great. Yeah, really great cast. Yeah. Jeffrey. Jeffrey Tambor has a small part. Jean Smart. If you guys like hacks. Uh, Jean smart has a small part, too, so, yeah, really fun cast.

Zach : My favorite way I heard this movie described was Rain Man meets John Wick, and I think that is perfect.

Caleb Newquist: Fun fact, fun fact Rain Man was the first R-rated [00:02:30] movie I saw. I know Zach saw his first R-rated movie, I think when he was like six weeks old, but that's beside the point. There you go. That's beside the point.

Zach : So I think the way that this episode is going to go is we're going to play some scenes from the movie that have to deal with accounting. We're going to do it chronologically, and then we'll break down the scene what we think is realistic, what's not realistic. And at the end we'll have some lessons learned and stuff like that. So actually this first scene is, I think the first time we see Ben Affleck as an adult in the film and [00:03:00] he's helping an older couple that's a farming couple with their taxes, they're struggling, and he's going to give them some tax advice.

Scene from The Accountant: She may have what the IRS calls a home based business. Your home is 2913ft². Irs code allows us to deduct from your taxable income a percentage of your workspace relative to your overall home.

Zach : What? So again, a fair warning. I am not an accountant. In fact, no one here is an accountant. But Caleb is a former accountant. But as far as I know, that is a very good tax advice. I don't think we played the [00:03:30] part, but Ben Affleck even makes sure like that this space that they use for the home based business is only used for that. It's not used for any other purposes, because that wouldn't be allowed to be written off as a tax deductible otherwise. He makes it very clear. And then I think he even mentions, David, you brought this up. He mentions his car.

David Leary : The truck.

Scene from The Accountant: Dolores, when you order supplies, do you order online?

Scene from The Accountant: I don't, I just zip on over to the bead store.

Scene from The Accountant: Zip.

Scene from The Accountant: I drive the truck.

Scene from The Accountant: The company truck. [00:04:00]

Caleb Newquist: And then there's that one funny scene where he's, uh, when he's talking about the square feet and he's like, he's just gesturing for.

Zach : Yeah, he's giving thumbs up to go higher. Your kitchen.

Caleb Newquist: Your kitchen's big. Your kitchen's bigger than that. Your kitchen's bigger than that. Yeah.

David Leary : Now, is that okay? As an as if you have a tax client, can you.

Caleb Newquist: I mean, look, give.

David Leary : Them the thumbs up like that.

Caleb Newquist: I mean, I haven't been a practicing accountant for many, many years, so this is definitely not tax advice or legal advice of any kind. But it's something that [00:04:30] I think happens in the real world. Yes. Very real. I would say that's very realistic.

David Leary : And the other thing we see in that scene is his computer screen for a split moment, and we see the name of his accounting firm.

Zach: Ah, yes.

David Leary : Which is z, z z accounting, which is just like, Like, it's almost like somebody just created the default spreadsheet for the movie scene and never changed that part out, and they just ran with it for the rest of the movie.

Caleb Newquist: Right, right. Yeah. They just had it as a placeholder. And then they never got around [00:05:00] to giving it an actual name.

Zach : You know, another thing I think this scene demonstrates is it shows us that Ben Affleck actually cares for his clients. You know, he has some empathy for them. He's like trying to help out these people, which I know a lot of accountants are actually trying to help their clients. They want to, like, do what's best for them. So yeah, it's nice for that. So next, we're introduced to J.K. Simmons character who works at the Treasury and with FinCEN. So David, I know you love FinCEN, don't you?

David Leary : Yeah. So he basically blackmails a analyst [00:05:30] for the Treasury. She's not an agent yet and blackmails her becoming an agent to track down the accountant. But I thought it was funny that all the business cards, everything said Treasury. But up behind him, I think there was a sign that said FinCEN. And I just thought how unrealistic? Because in 2016, they were already making plans on starting BOE and canceling BOE so much that there was. It's just not very realistic. They would Vincent would be chasing down the accountant.

Zach : So for any of our listeners who may be unfamiliar about who [00:06:00] FinCEN is or what they do, and from their own website, FinCEN is a bureau of the US Department of the Treasury. Fincen's mission is to safeguard the financial system from illicit activity, counter money laundering and the financing of terrorism, and promote national security through strategic use of financial authorities and the collection, analysis and dissemination of financial intelligence.

Caleb Newquist: Yep.

Zach : All right. So then we find out Christian Wolf, Ben Affleck has like a handler, you know, accountants. You know, it's like having a secretary. They can't get their own. They can't handle their own work. [00:06:30] So his, uh, his handler tells him, like, I don't want you doing dangerous stuff. Oh, yes. We find out from J.K. Simmons that Ben Affleck's character, Christian Wolff, basically, he's an accountant for the worst type of people. When Mexican drug cartels have money missing or when you know the mafia or when like a terrorist in like different places have money go missing. He's the person they call in, but his handler wants him to do some safer work. So she has got him a job at a company called Living Robotics, at Living Robotics. And [00:07:00] he's there because there's been some abnormalities detected, uh, in, like, their books from a junior accountant. And he's going to go look into it and figure out what's going on. So here's him requesting, uh, what he needs to do, this forensic accounting work.

Scene from The Accountant: I think if you saw our books, you'd run for the hills. We have an incredibly complicated accounting system, depreciation schedules on hundreds of different items, full time and contract employees. Department of defense classified accounts, numerical shitstorm.

Scene from The Accountant: I'll need to see all those books for the past ten [00:07:30] years. Bank statements, complete list of clients and vendors. Hard copies printed out my eyes only.

Scene from The Accountant: All the information is right here.

Scene from The Accountant: Okay, well, well, look, this all came to my attention only last week. Now a junior cost accountant stuck her nose where it didn't belong and obviously had no idea what she was looking at. Lamar is overreacting. There's no missing money.

Scene from The Accountant: How long have you been CFO of this company, sir?

Scene from The Accountant: 15 years.

Scene from The Accountant: I need the books for the past 15, please.

Zach : So in that scene, Ben Affleck is talking to the CFO of the company who's, like, [00:08:00] trying to warn him how complicated it all is. We also hear, like we said, that a junior accountant, played by Anna Kendrick is the one who found this in the first place. And, um, I'd say that that's pretty realistic. From what I know, requesting ten years of books isn't insane and requesting all the specific things he wants to look through for a forensic accounting situation. That definitely be what they would want. Like, you know, at least to start with, uh, I guess the unrealistic part would be it would not be one man doing this at all.

Caleb Newquist: No. You got I think the other thing.

Zach : That's what the logline you got the math savant. [00:08:30]

Caleb Newquist: So yeah, I think the other thing that's kind of funny about that scene is the CFO. Maybe if it was an auditor, maybe he wouldn't be so blunt about the state of their accounting, but he's like, it's not really, you know, bragging rights about how complicated your accounting is. Accounting system is. I don't think there's any CFO out there. Just want wants everyone to know. It's like our books are like, it's a disaster. Like you don't even want it. He's like, oh, you'll run for the hills.

David Leary : But it's like intimidation [00:09:00] of the potential auditor. Absolutely. Which probably happens. I imagine companies intimidate auditors and then think very lowly of a junior auditor, right?

Caleb Newquist: Well, in this case. But he's a consultant, right. Like, he's he's he's he's being, um, engaged to to find, uh, you know, a leak in the books. And it's weird that a CFO, I don't know, like the CFO role or the CFO dialog was a little bit, I don't know, I had mixed feelings about it. But in any [00:09:30] case, you are right. Like there is there is there are definitely clients who will try to, like, downplay things that they think are nothing. And we'll try to, you know, maybe not. This is a little bit cynical, but to distract somebody from, from something that they don't think is important.

Zach: Yeah. So we're never made clear exactly if he knows about the fraud going on. But we assume he's been with the business since, like it's founded, he points out, or something like he's known them. You know, he's probably involved in this fraud. And also, um, you know, this reminds [00:10:00] me of, uh, you know, an actual interview that you did Caleb back with Nathan Mohler, who committed a fraud and, like, he was an accountant, but, like, he was able to direct the auditors wherever he wanted. He told, like, you know, he's like, what about the auditors? And when they came in, he said they were young, you know, junior accountants who didn't know what they were doing. He'd be like, look at this. Not over here. Look at this. Like he was able to direct exactly what he wanted them to see. So it's kind of surprising that Anna Kendrick, I guess, in this movie was, like, steadfast enough that she was able to get them to, like, hire an outside person. Uh, something else just to point out this company, the reason they want to audit [00:10:30] is because it's about to go public. And that reminds me of, you know, after Enron, Sarbanes-Oxley went into effect. So, you know, with this audit qualify for that most likely. We don't know all the details of this engagement, but most likely this would qualify all the requirements for Sarbanes-Oxley, which is what companies that want to go public need to comply with and go through before they're allowed to do that.

David Leary : Well, he'd have to be a CPA, right? It's not even clear that he's a CPA in the whole movie.

Caleb Newquist: Oh, no. His nameplate in his office says accountant. It does not say CPA.

David Leary : So he can't sign [00:11:00] off on an audit.

Caleb Newquist: So this is technically not. And it's apparent that the AICPA probably didn't give the producers the right to use CPA on a nameplate.

David Leary : Even think about that.

Caleb Newquist: Oh, yeah.

David Leary : So then it's the total stereotypical junior accountant scenario. Kind of the next scene, it's the next morning. And they delivered all these things that the accountants requested. And then the scene starts with Anna Kendrick sleeping at the desk all night, which is like stereotypical junior accountant scenario. [00:11:30] They could exist.

Zach : And then Christian Wolf, Ben Affleck comes in and he starts writing things on walls, starts organizing stuff, and then, you know, he's he's a little bit, um, standoffish, for sure. At lunch, he tries to bond. Anna Kendrick talks about, like, why she became an accountant. And, uh, here's a little bit about that.

Scene from The Accountant: I like the balance of it. You know, I like finding things that aren't obvious. Plus, my dad was an accountant. He [00:12:00] actually. You know, he had the whole shtick. The, uh, you know, the little amortization book and the green eyeshade and the, like, dorky pocket protector.

Scene from The Accountant: And I have a pocket protector.

Scene from The Accountant: That's a nice one. I mean, his was dorky. That's. Yours is nice.

Zach : Uh, and then my favorite part was when she talks about how much, uh, you know, University of Chicago and accounting is, uh, is fun for her. For.

Scene from The Accountant: So I studied accounting [00:12:30] at the University of Chicago, where fun goes to die.

Zach : Real fun. Real like, you know, real advertising for the accounting where fun goes at. I was talking about the University of Chicago, I think so, but, you know, she's talking about maybe accounting.

Caleb Newquist: Maybe accounting specifically at the University of Chicago is where fun goes to die. It isn't clear.

Zach : So, uh, the next scene is basically directly after that for the accounting side is there's like a Beautiful Mind montage, you know, Ben Affleck, Russell Crowe. What's the difference? He's just writing numbers all along the wall. He's whispering things to himself and like, we're [00:13:00] just, you know, it's basically the most exciting accounting like, numbers crunching scene you can make. So I'll give them credit on that. Like, how could you make numbers crunching exciting? It's got like, violin, like exciting pretty music. It's even reminds me of you.

Caleb Newquist: Know, and he's also he's also every time that the one of his, uh, uh, whiteboard markers runs out of ink, he, like, cans it right in the trash can. Like, he just makes every single one of them. There's red and there's black and there's like. And there's like, by the time he's done, there's like a dozen of them in the trash, and you're just like, oh, yeah, that is [00:13:30] kind of exciting.

David Leary : So Anna Kendrick's character says that she crossed all the files and organized them by year and alphabetically. Do you think they actually helped him, or does he even need the the information organized to process this data? Can he just take it randomly and just do it all in his head?

Caleb Newquist: I mean, I am not an expert on, uh, on on people with autism and or high functioning autism, especially. Um, but I think it makes little [00:14:00] difference. Maybe it saved him an hour. Let's say it took her all night, but it saved him an hour.

David Leary : And the issue with the movie that's kind of crazy is the public's impression of an audit is this. Somebody looks at everything and finds out, figures out something's wrong, the fraud. But we live in a world where all these audits happen. And every time we turn around, Blake and I talk about this in the accounting podcast all the time. Well here's another fraud that happened that the auditors never found. That's right. And this doesn't help. This doesn't help [00:14:30] the public perception of what an audit actually is versus what we think it is.

Caleb Newquist: The auditing profession, especially the big, big auditors, they like to talk about an expectations gap. They call it the expectations gap. And it's their go to talking points when it when when this when this comes up, which is it's like well the public thinks we do one thing, but in reality we do this thing and we're going to do this thing. We're not going to do what people think we do. And so, yeah, no you're not.

David Leary : Somebody made a movie that's watched [00:15:00] by hundreds of millions of people that shows what they what you do. Yeah. In theory.

Caleb Newquist: Yeah. Yeah.

Zach : So basically we see that whole montage. Was that like a few days? Is it a week? How much time is he spending on this? Nope. He cracks the case in a single night.

Caleb Newquist: Yeah, yeah. One night.

Zach : Here's some folks. And, uh, here's him describing exactly what he found. And that Anna Kendrick was right, that the anomaly that she found was correct. And like there's an actual issue with the books.

Scene from The Accountant: Come in, come in, come in, come in. You have to see this. Look at this. It's going to blow you away. I [00:15:30] mean, it'll just jump. Jump right out at you. Living robotics ten years ago. Earnings before interest. Tax. Depreciation $14,495,719. Nine years ago. Earnings before tax and depreciation. Revenues go up. Profits go down. Down. No large capital expenditures dragging. Profits down. No spike in raw materials or labor costs. Year eight. Profits and revenue both go up, but not in a commensurate fashion. X no longer equals Y. Six. Five. Four. Three. You're making [00:16:00] money, but there's a leak.

Zach : Okay, so basically he describes, like he finds $60 million that are missing. That should be there. Now, he doesn't know exactly where it's gone or what's going on with it, but that's what he's found to start. That's the exact accounting scene that we see. Uh, during this time, we're also introduced to a random I don't know what to call him a thug. Intimidation, a contractor, a mercenary. What are you going to call Jon Bernthal's character in this?

Caleb Newquist: He's a mercenary, for sure.

Zach : Okay, so introduce the [00:16:30] mercenary.

Scene from The Accountant: You're shorting their stock, but simultaneously, you're spreading false rumors regarding the health of the company. The resulting decline in the stock price. It's made you your millions. But it's been at my client's expense, and they have been forced to cut hundreds of jobs. Simon, these are third generation metal workers. People with families. Pensions are being rendered worthless because of you.

Zach : So he gets into this car of some type of hedge fund manager, and he's doing short selling on a company from lying about them. And he's. [00:17:00] Yeah. So he's a shitty guy. He's a liar. He's a I don't know, we don't he looks like the typical sleazy, sleazeball type of guy.

Caleb Newquist: Well, he's got a British accent. So like, you kind of think, oh, he's very sophisticated, I do.

Scene from The Accountant: I have kidnap insurance, you obviously know that.

Zach : And, uh, Jon Bernthal tells him, like, you know, you're taking away jobs because we had the price went down, so we had to fire 400 people and their savings accounts are getting drained. So like, you're going to fix this. And the guy's response is like, what company are you talking about? I do this with all these companies.

Caleb Newquist: We short dozens of companies. [00:17:30] He's like, oh, do you lie about dozens of companies?

Zach : So I should point out that, like, obviously shorting stocks is nothing illegal. With shorting stocks. You could assume that the price is going to go down and try to short a stock. That's completely fine. You're not going to get in trouble with it. Obviously, if you're the one making the price go down by lying, like putting out false information by intimidating people, whatever you're doing, then that is the illegal part. And that's why Jon Bernthal is there to teach him a lesson.

Caleb Newquist: I forget is that the first time we meet him? Is that the first time we meet him? That's the first time. Okay, yeah. So it isn't clear necessarily right away [00:18:00] that he's a mercenary, but he he is he is a very he's a very calm, cool, collected character. And he gets in that car and he intimidates the hell out of this rich hedge fund guy. And it's very satisfying. It's a very satisfying scene.

Scene from The Accountant: Oh.

Scene from The Accountant: I'm an avid reader of the journal, so I expect cooperation to be reflected there. Simon, are we good?

Zach : So the next time we see Jon Bernthal is after, um, Christian [00:18:30] and Dana find this fraud. They want to go tell everyone, right? Like, oh, we found what's missing. Like, we can investigate this further. And instead they find out that Christian is let go. He's been fired. So it's like what? Like I didn't get it finished. That's like his main thing he's upset about. Like, I didn't get to finish my work. And they, like. They started moving things around. He's going through his files. They're starting to erase his whiteboard and all this, like, stuff on the walls.

David Leary : And he's very similar to his reaction when he lost the puzzle piece as a child in the beginning of the movie.

Zach: So the first scene that we see, yes, the first.

Zach : Scene that we're introduced that [00:19:00] shows him he's like a little bit different is he's solving a puzzle that's not even upside down. How would you describe this?

Caleb Newquist: Well, the back of he's he's solving it with the back of the puzzle.

Zach : Just by the shapes of the pieces. Not by any artwork at all. By the shapes only.

Caleb Newquist: And it's a and it's and it's a flashback scene. For what.

Zach : It's a flashback scene as a child. Yeah. Yeah. That's when we there's so throughout this movie there's some flashbacks that show some anomalies like that, that he didn't have a good relationship with his father. He was pretty strict. He also that's where he learned. He learned how to fight. [00:19:30] And his father was, you know, making him get into fights with strangers. I was like ten year olds. Um, but. Yeah. But anyway, so, uh, he finds out that he's being let go from this. And then we see John Bernthal again when he's sitting with the CFO of the company, telling him, basically, you got two options suicide or I'm going to kill you.

Caleb Newquist: It's weird because the CFO, it's it's it's dark. He's in his house and he's walking around and he's in his pajamas. And then all of a sudden, uh, Jon Bernthal is eating ice cream, [00:20:00] uh, at his dining room table and basically gives him, you know, uh, the option of committing suicide or, uh, being murdered. And, um, And he, you know, they they go through the back and forth a little bit and it's, it's clear what's going to happen. Um, I guess I won't spoil that part, but it's clear that it's clear what's going to happen to him. And, um, but it's strange because we don't necessarily put together at this point, like, why Jon Bernthal's character is even there. Like, how did that even [00:20:30] how did how did why did he show up there? Right? There's nothing that tells us why he ended up.

David Leary : You just wrote, oh, that's the guy who intimidated the other guy. And that's where, you know.

Caleb Newquist: He's like, oh, this is what he does. He intimidates financial guys. That's kind of all we really know.

Zach : Great. So, um, at the same time, though, we see that, uh, some, some mercenaries show up at the farm where Ben Affleck has been staying, uh, to do this job. And, David, I know you like this scene.

David Leary : This is my most favorite scene in the movie. [00:21:00] These bad guys go to the farmer's house because they're looking for him, and they call him the bookkeeper. Where's the bookkeeper? They want to go. It's just this typical thing that's gone on forever. Accountants versus bookkeepers. Accountants don't want to be called a bookkeeper. And the fact that they put that in the movie is just amazing that they called them the bookkeeper instead of the accountant. I thought that was hilarious.

Scene from The Accountant: Call the bookkeeper in.

Zach : Yeah. So basically, uh, you know, Ben Affleck has a 50 caliber sniper rifle.

Caleb Newquist: Oh my God.

Zach : And he just starts taking out. I think there's three mercenaries. [00:21:30] The first one he takes out in the house, uh, they take the farmers hostage, he gets them on, like the truck. Whatever. Christian Wolff, Ben Affleck, he realizes like, oh, no, this when he puts it together. Like they wanted me to get off this case for a reason. They're coming after us. That means they must be coming after Anna Kendrick's character, Dana. So he goes and he, uh, goes to her apartment, where, of course, there's multiple mercenaries there as well. He kills them. I think he kills five people in one apartment, um, including outside and in it. And then he saves her, and he, like, takes her to a hotel as they could lay low. [00:22:00] Uh, this is when he discovers what they're doing and the reason that they're committing the fraud. And he compares it to another fraud that actually, oh, my fraud covered. But let me play the scene first.

Scene from The Accountant: Crazy Eddie in the Panama pump. Crazy Eddie Antar in the Panama pump. Have you ever heard of what? Crazy Eddie Antar. He owned a string of electronic stores in New York City in the 80s. Crazy Eddie Antar. He started stealing almost as soon as he opened the business.

Scene from The Accountant: Okay, I'm not following.

Scene from The Accountant: He deposited money in Tel [00:22:30] Aviv, and then he cycled it through Panama and put it back into his stores.

Scene from The Accountant: Okay. Why? Why take it out and put it back?

Scene from The Accountant: Well, initially he was just stealing in garden variety tax evasion, but then he came up with a better idea. You see, by taking his own money, stealing it and putting it back on his books.

Scene from The Accountant: It was raining cash.

Scene from The Accountant: He took the company public at $8 a share. A year later it was trading at 75.

Scene from The Accountant: Rita's taking living robotics public.

Caleb Newquist: So we interviewed. We interviewed a journalist who wrote a book about Crazy [00:23:00] Eddie. His name is Gary Weiss, and he, uh, he chronicles basically the entire story of Crazy Eddie, episode 16. And it was it is true that it was basically they were they were taking money from the business pretty much right away. Uh, and long story short, it became a public company and they made lots of money. But this Panama pump, uh, portion of the scam, they ran all kinds of scams. But this one in specifically is they took profits [00:23:30] from their US based business. They moved them to Israel. Okay. And then they opened fake accounts in Panama. They moved that money from Israel to Panama, and then they moved the, um, money in Panama. They basically made false invoices. And the money came from Panama to inflate their revenue. So this was this was when Crazy Eddie was a public company, and the Panama pump was one of the schemes they were running. And that's how that's that's the gist of it.

Zach : So basically [00:24:00] he makes his revenue make they make the revenue seem like it's higher, which means like it's doing better as a company, which makes people think that the shares go up and the price goes up for the shares, and the company is worth more money, but it's overvalued, obviously, because they don't actually have that revenue coming in. And so that's a lie.

Caleb Newquist: You should definitely check out mirrors. Yeah. Yeah, definitely. Check out our conversation with Gary Weiss. Because we talk about it. We get into the whole thing. And um, and Gary is, is I don't know, he's a great he's a great storyteller. So he has all kinds he had all kinds of fun details about that story.

Zach : So after Ben [00:24:30] Affleck saves the day and everything. Uh, he cuts to Jon Bernthal's character being so surprised that an accountant has handled this. So I'm going to just share that. It's a little funny thing.

Scene from The Accountant: It's when are accountants difficult to ventilate? Dead. Christ, what are you doing? Hit him over the head with an adding machine. Put me in touch with a client. I'll handle this accountant myself.

Zach : Yeah. So, you know that's that's how they fight. They hit people over the head with an adding machine. [00:25:00]

Caleb Newquist: Sure.

Zach : That's what you learn in your extra fifth year for getting your CPA. That's what I learned. That's what they teach you these skills. Right, David? That's what the fifth year of education is for.

David Leary : That's 150 hours is for that. So what's interesting is there's those stereotypes of like, this is how the account would kill somebody. But we got introduced to his character via his trailer. So he has an Airstream that he has parked in storage. Obviously it's arguably questionably a safe, uh, a safe house that he can move around [00:25:30] and we get to see what's in his trailer. And it brings up a lot of tax questions when you when you actually see it. So he has this artwork in his Airstream. He has a Renoir, a Pollock. He obviously has lots of cash, gold bars, um, he has guns. But the you start wondering like, is this a tax shelter? Like, why does he have these expensive assets? Does he need to flip them? But this is and then you see the guns and this really starts changing your perception of an accountant of who he is as a character. But why did [00:26:00] he I like I get the cash and gold, like if he's got to move something fast. But the artwork never really made a lot of sense to me. Like, what's your thought on that, Caleb? Is it just an asset he can move later on? It seems like you can't sell that very fast.

Caleb Newquist: No, it's not very liquid, but those are. If I remember the him talking about it, he liked it. Those were pieces of art that he liked. And he was able to take them as form of payment. So remember he's got these big, bad, dangerous clients that are super, super rich, right? And [00:26:30] maybe they don't. And maybe to keep things like, uh, maybe not to draw attention, you know, a Pollock, uh, that Pollock, I, I didn't I intended to look it up because I wanted to know the value of it, but that that painting is worth millions and millions of dollars.

David Leary : So instead of him getting a deposit that would attract attention in a bank account, I'll just take this painting and I'll take.

Caleb Newquist: This painting.

David Leary : On.

Caleb Newquist: It. Yeah. And there's a, there's a, there's a scene early on with this handler where she is trying to convince him to sell that Pollock, [00:27:00] and he refuses to do it because he either needs the liquidity or something. And he likes the painting so much that he doesn't want to sell it. But he does want to. He's like, I'll sell the Renoir. And the Renoir is also a very the it's a woman. It's called woman with a parasol. I did look that one up, but also a very valuable painting. And, uh, he's willing to sell that.

Zach : I looked up the Jackson Pollock one right now.

Caleb Newquist: Oh, yeah? How much is it?

Zach : So in 2006, it sold for 140 million.

Caleb Newquist: Yeah. See? There you go. It's a it's an it's an insanely valuable painting. Um, and [00:27:30] so, uh, yeah. To, to have something like that. Um, sure it might. The art world. So I'll plug another episode of my fraud here. Uh, that we did a, uh, an episode about a Ponzi scheme that occurred in the kind of the the, the elite art world and, um, the. And it's a it's also a fascinating story, but the art world is kind of it is kind of like there's kind of like seedy [00:28:00] deals kind of going on all the time. There's kind of these underhanded things going on all the time. And so when you're dealing with artwork like that and you're dealing with the amount of money that those pieces are worth, then yeah, it's one of those things where he's like, yeah, he kind of knows what he's dealing with. He's kind of in these, uh, gray areas. So, uh, getting rid of the painting when he ultimately had would have to, uh, he he would that would be, you know, that would be sketchy, too.

Zach : So art is also a great way for money [00:28:30] laundering and for, like, um, embezzlement in general. Right? Because, like, the valuation of them could be way different than the price you're paying for them or what? You're storing money that way. You don't have to, you know, depending on should obviously report anything you buy. People don't always report artwork. Um, actually, that leaves us a great transition to when the agent investigating Christian Wolff with J.K. Simmons, Cynthia Robinson, who's investigating, you know, Ben Affleck, she realizes that she's trying to find who's the accountant. And [00:29:00] the way she finds this is through three, uh, different businesses that are doing some basically money laundering. And I'm going to play that clip for everyone here.

Scene from The Accountant: Christian Wolff last year ran $75,543 through his accounting firm, 75 grand.

Scene from The Accountant: That's chump change.

Scene from The Accountant: Agreed. But he ran another $287,765 through Kim's nails, $445,112 through Great Mandarin Chinese. And you'll love this $505,909 through [00:29:30] Paul's Laundromat. He's playing with us. He can't clean that kind of money through an accounting firm. The paper trail is too heavy. So he's laundering it through cash businesses. All of those are in the same strip mall south of Chicago.

Scene from The Accountant: Z-z-z.

Scene from The Accountant: I mean, he doesn't care about the traffic. It's a front.

Zach : All right, so if anyone's unfamiliar with money laundering, basically what that is doing is trying to take dirty money, illegal money, and somehow making it seem like it came from a legal source. So a way that this often happens, and a famous example is in Breaking Bad. Walter White has a drug business. He's making tons of money [00:30:00] from selling meth. He opens a car wash so he can pretend that a bunch of money is coming through that car wash, and then when he does his taxes for it and he receives that money, it's clean, so to say, you know, you pretend like it was a legitimate business that it came from, and now it's a clean money. Actually, funny enough, another example of that is Ozark. And the writers of Ozark actually were the two writers on this movie, The Accountant. So you can see a little bit of a parallel with that.

David Leary : That's a that's a nice trivia tidbit to have here. And specifically, he owned all the businesses in this strip mall. He had Paul's laundromat, [00:30:30] he had Kim's nails, a Chinese restaurant and accounting all in the same strip mall, all owned by him.

Zach : Yep. So he was able to flip, you know, he had $1 million of income, but you can't pretend. I thought, actually, here's a here's a funny thing. I was a little shocked about this. An accountant can make $1 million a year as a business. Why did they say that was way too much for him? He had to pretend like it was. It was four different businesses. What's wrong with making $1 million a year as a, you know, in the suburb of Illinois? Like, I was like, what? What's with that?

Caleb Newquist: Yeah, it felt like an [00:31:00] accountant that's only making 75 grand a year is. Yeah, not doing insulting.

Zach : I'm not even.

Caleb Newquist: It's a little.

Zach : Insulting. Insulting?

Caleb Newquist: Yeah, yeah.

Zach : Um, great. So I mean, that's most I will be completely honest. That is most of the accounting in this movie. We will get to the rest. We will get to more of it at the end. And like we cover some themes, but at this point it is a shoot em up revenge movie. Basically, that's the rest of the 40 minutes of the movie or whatever it should be. 30, I'll say. Um, so basically the next thing we find out is Christian [00:31:30] Wolff wants to go talk to the sister of, um, the CEO of the company, John Lithgow, and like, you know, try to get information on that because he knows that the CFO has died. I don't know if you ever get her title. Do you ever know exactly what her job at the company was? She's talked to him multiple times when he's doing his audit. I don't know if you ever know her to title the company is he goes to talk to her. She's dead too. They're cleaning the house. It's the only person left is the CEO, John Lithgow. This leads to him having security. He's hired Jon Bernthal to like, you know, protect him. They have 15 [00:32:00] mercenaries. I don't know, an absurd amount of mercenaries. It leads to.

Caleb Newquist: Armed to the teeth.

Zach : Yeah. Ben Affleck, you know, he's trained for this, apparently. Like I said, that's maybe this is also what the 150 hours are for. He's going to get the military training again.

Caleb Newquist: Yeah. Yeah.

Zach : And he takes them all out. He takes literally all of them out. Uh, he ends up seeing this when we learn there's a twist. You know, we've had flashbacks and they're alluding to it pretty hard. But the other mercenary, Jon Bernthal, is playing. [00:32:30] And Ben Affleck's character. They're brothers. They grew up with the same strict dad, and somehow their paths haven't crossed. I think he says it's been ten years is what Jon Bernthal says to him. But, you know, they fight a little bit, but basically they decide, you know, they're not going to kill each other, which, you know, just to show the theme, even though he's they're mercenaries, they decide not to kill each other. When the CEO of the company had his own sister killed to cover up fraud. So it shows a little bit like, who's the real, like, good person here, right? You know, killing people. Um, left and right. And, um, I guess the last part [00:33:00] that accounting is really shown here is John Lithgow's character tries to rationalize, like what he's doing and, like, call out Ben Affleck. And, um, we get into this when we at the end, we're gonna do some lessons learned. But I just want to play this scene first.

Scene from The Accountant: Do you consider what you do important, Mr. Wolff, to someone other than yourself? I mean, what I do is living robotics public offering would have been worth billions money to be used for neuroprosthetics [00:33:30] nanotechnology. You. Why in God's name did I ever hire you.

Scene from The Accountant: To leak proof your books? Dana found a mistake, and you wanted to be sure it was safe to go public. And now you want to kill her?

Scene from The Accountant: I'm fond of Dana, but I restore lives, not Dana. Me? Men. Women. Children. I give them hope. Make them whole. Do you even know what that's like?

Scene from The Accountant: Yes, I do.

Caleb Newquist: I [00:34:00] think it's hilarious. I think it's hilarious that he. Part of that rationalization is that he restores lives. And so he's going to commit murder in order to continue restoring lives. That's how important this is. Anyway, John Lithgow was great. He's so good.

Zach : So that's basically the end of the movie. Um, the last little, you know, we got a couple end bits. Basically. J.k. Simmons completes the transition for the new agent taking over his role. Um, and [00:34:30] in the meantime, they are investigating him, like, finding, like, you know, she finds out where he works, they find his house, but nothing really comes from it. Um, also, we learned the background. Basically, why Ben Affleck is, uh, is involved with helping these people catch like criminals in the first place is because, um, revenge for his mentor when he was in jail, who taught him how to do this type of accounting. Uh, he was killed originally by a mafia person, and Ben Affleck got revenge on him. And then ever since then, has been giving information to J.K. Simmons to help him take down the bad guys. [00:35:00]

Caleb Newquist: Yep.

Zach : Um, that's just some background of it. And, um, the last thing is speaking of, like, you know, payment. So Anna Kendrick, as, I guess, a gift as a payment, whatever. Ben Affleck gives her, the Jackson Pollock that we just said is worth in 2006, $140 million. Now, what could she possibly do with that? We see her hanging it. No. No frame or anything like that? No. You know, just just hanging it on her wall. But, uh, I don't even know, like, if you're trying to even get that as a gift, I don't even know what you could possibly do with it. You can't. You can't sell it sell the [00:35:30] beauty.

Caleb Newquist: Well, she remember she wanted to be an artist.

Caleb Newquist: So for her.

Caleb Newquist: To to have to have the art is way better than, you know, to sell it for a bunch of money. In her case, like, if you're a rich person who collects that kind of stuff all the time, then no, it's a game. But for her, no.

David Leary : Does she have a tax payer.

David Leary : For receiving it or when she sells it? Is that the tax hit?

Caleb Newquist: No, you would not. Well yeah. She if, if, if it but if it's a gift that's a I mean I don't know again my my my my [00:36:00] tax accounting chops are very rusty. It's been a very long time since I did that kind of work. But if that's a gift, it that painting is way worth way more than whatever the gift exemptions are.

Zach: Yeah.

Caleb Newquist: So so I don't know.

Caleb Newquist: That that and but maybe because they're not related then maybe that means it's fine I don't know. But if she were to ultimately sell it one day, she paid zero for it. And so she has 100%, you know, capital gains tax on this [00:36:30] piece of very valuable art. Um, anyway, I'm sure there's someone out there that can correct all the mistakes that I made.

David Leary : And, Zach, you said it's worth $140 million. It's the last auction.

Zach : In 2006. It was sold for $140 million.

David Leary : So let's just say, let's say the accountant is worth $1 billion.

David Leary : $100 million. He just gave 10% of his net worth away. Like how much? How much is he worth to just gift away $140 million painting?

Zach : That's a great transition, because we also learned that the whole money that he receives [00:37:00] in cash, that he launders anyway, through the small businesses, he gives all of that away to charity as well, to an autism school.

David Leary : That he finances, that school that.

Caleb Newquist: He finances that school. That's right. Yeah. And they kind of and they and that's there's a little there's one final twist at the end that I don't know if we want to share, but like, I mean it's been almost ten years. But they, they do they do have this kind of final scene at the school. And that's the school where Christian, um, he didn't Did he ultimately end up going or he?

Zach : I'm not sure if.

Caleb Newquist: Did he make that?

Zach : Did they don't make it clear?

Zach : No, [00:37:30] they don't make it clear if he ever went. Um, you know, also throughout the movie, there's some weird stimulation things that he tries to, like, do to himself, like to get used to, like different stimuli, like loud music, flashing lights, hitting himself in the legs.

Caleb Newquist: No, no, no, you know what he's doing there, right? With that big with that, like big wooden, kind of like, uh, it's kind of like he's.

David Leary : Preparing for.His job at the big.Four. Is that.

David Leary : It? When he's smacking himself with a wooden doll.

Caleb Newquist: Yeah. The. Yeah. The. Yeah. Pain. Endurance [00:38:00] is pain. But no, what he's doing is he's like, he's, um, he's making sure that the blood flow in because he sits so much because he's an accountant. He's making sure he doesn't get blood clots in his lower leg.

Zach : He just needs some compression socks that's all you got to get.

Caleb Newquist: Yeah. I mean, I mean, that would be the easier way to do it, but there there must be something to the loud music and like, you know, getting his blood circulation Smooth.

Zach : I will say, part.

Caleb Newquist: Of his routine.

Zach : It is rare for an accountant. Uh, you know, he's his best tools are his calculator and his flash bangs. So, you know the [00:38:30] flashing lights I.

Zach : Have to have. That's what's practicing for those flash bangs he uses in that final scene.

Caleb Newquist: Yeah.

Zach : Um. Pretty epically. All right, so I think now we can transition to basically there's a lot of accounting in here, a lot of stuff that we get right, a lot stuff they don't quite touch on. But I think it's worth us bringing up. So one of the things that I brought up earlier, a little bit that I want to get into, is the fraud triangle. So personally, you know, Caleb, if you want to explain the the three elements of the fraud triangle, then I'll get into it actually.

Caleb Newquist: Okay. Yeah. So there's three elements to a fraud triangle. There is, [00:39:00] uh, opportunity. Okay. You have to have the opportunity to commit a fraud. You have to have usually pressure. And that's kind of that's, um, sometimes that's the motive, sometimes it's not. And then there's rationalization. So, uh, as I explained on a recent episode, most people know that fraud is wrong, but when you're committing a fraud, you are. The psychology of it is, is that you convince yourself that even though you know this [00:39:30] is wrong, you have a good reason for doing it. Like and it might be something as simple as, oh, I'm going to pay the money back, I'm just borrowing it. And so. John Lithgow.

David Leary : Yeah, right. Precisely. Help all these people. Yeah, yeah. So for this case.

Zach : So. Yeah. So let's get into the actual ones for this case. Right. So John Lithgow, you know, there's always when you have the fraud triangle, it could be the individual or the company. Sometimes both. They don't really go into if there's anything going on with the individual. But with the company robotics, we definitely know that there is. So we know that [00:40:00] his opportunity well, he's the CEO of the company. He could obviously do embezzlement for this company pretty easily. It doesn't seem like their internal controls are stopping him at all from doing that. Uh, to be fair, we don't ever get we never know exactly who did the embezzlement. We don't know. It was a CFO who did it. We don't know if John Lithgow himself, if he had some other henchmen below him, do it. But, you know, that was obviously there. Now the rationalization is for sure that he sees it as like, I could make more money from pretending our revenue is up. I could make more money in the public offering and [00:40:30] I could help more people. He even has that line. I played it for you earlier and he tells Ben Affleck, like, I save lives, I help people. Like I, you know, do all that altruistic fraud. Yeah, right. I mean, we just covered another one where it really was altruistic, though. Caleb, your episode recently on the Australia's greatest con man.

Caleb Newquist: Yeah,

Zach : He was altruistic fraud. And, um, that's kind of like his pressure, incentive and rationalization. They kind of go together. Like he didn't. His company could have gone public and it would have been fine. But the pressure was I wanted to do even better. [00:41:00]

Caleb Newquist: Yeah.

Zach : Like, you know, there wasn't. So it kind of goes together. The pressure and the, um, the rationalization in this one. In my mind.

David Leary : You could argue that the accountant himself was living in the fraud triangle. He was playing financial shenanigans. Legal, not legal. Hiding money. Right, with these paintings and things like that. And he obviously justifies it because he's, you know, he takes a lot of the income and he donates it to that autism, that school for autism. He justifies the, you know, his murdering comes from a place of justification and goodwill. If he calls [00:41:30] it that and then he has the pressure of he can't ever get caught. So in a way, like you could argue, like the accountant himself is living in the fraud triangle at all times.

Caleb Newquist: No, that's a good point. And I mean it. You're right. It is the. Yeah. Giving the money to the school. That's a that's I mean, that's a perfect example of somebody who's just like in their mind they're like, yeah, but I'm not keeping any of the money. I have an Airstream and I can, you know, if I, if I can leave in 12 minutes, uh, then then I need to escape because I have very dangerous [00:42:00] clients, and his clients are dangerous people. So in his mind, he's like, well, they're dangerous people. So if I'm if I'm killing people that work for these dangerous people, then that's fine. Yeah. There's all kinds of rationalization going on with the accountant. That's true.

Zach : I think they show a lot of moral ambiguity for him, like multiple times. Uh, the fact that, like, he gives the money away, but he also obviously he's killing people. He's also taking it, um, even with his brother, John Bernthal. The same thing. Like we see him first helping someone good, right? Like the guy who's, [00:42:30] you know, the hedge fund manager, but later he's killing people because he's hired to do it basically. Right. There's another reason I also mentioned, like, funny, funny enough that like, it seems like they have a little bit stronger of a moral compass in terms of, well, we're not going to kill family.

Caleb Newquist: Yeah, right.

Zach : Like that's a line.

Zach : We won't cross even.

Caleb Newquist: Right?

Zach : And John Lithgow was willing to cross that. But yeah, I agree that there's tons of like pressure and stuff from the rationalization from Christian Wolff, Ben Affleck's character happening all the time with this, because that's just how else are you going to live with yourself [00:43:00] if you're not? He's working for terrorists. He's working for cartels, I guess. Also, if you want to get into like, is he are they getting them or not? It seems like a lot of times now he's giving them to FinCEN and the investigators like, catch them in these crimes. But we don't know if that's always the case with everyone he works with. I feel like you would pretty quickly realize not to work with them if that was the case.

Zach: Like, oh,

Caleb Newquist: Right.

Zach : Like everyone who works with this guy ends up getting arrested, maybe, like, we shouldn't hire this workman.

David Leary : Yeah, it's not really clear, is he? Is he is he being, uh, a whistleblower just on this case, [00:43:30] or is he constantly filing, sending stuff over to the Treasury and FinCEN?

Zach : So that's another good part to talk about whistleblowers. So, um, I don't have the numbers offhand, but I could tell you that the majority of fraud and the majority of any fraud that we've, you know, from every report is caught by whistleblowers.

Caleb Newquist: Not by tips by.

Zach : Tips and.Whistleblowers.

Zach: Yeah.

Zach : So not by not by audits, not by, like doing anything else like investigating it. But whistleblowers and tips are going to catch the majority of frauds that are caught across this country in every everyday life and every big company, [00:44:00] small companies, it doesn't matter because, yeah, someone sees something, say something. That old adage, Caleb actually interviewed two whistleblower lawyers back on an older episode of My Fraud. So if you're interested in learning more about what they're looking for, that has more for big corporations like this would have been for like SEC usually.

Zach : But, um.

Caleb Newquist: But we also interviewed a whistleblower, Tony Menendez, who was a whistleblower at Halliburton. His case was kind of a saga. It was like 14 years or something. I can't remember now. But go check out the interview with Tony Menendez. Uh, [00:44:30] really, really great, uh, perspective from a whistleblower.

Zach : So the next accounting concept I think we should go over is like, yeah, forensic audit. And again, none of us are accountants right now. Caleb is the only one who was a former accountant. And as far as I know, like from my research, I looked up in this, everything he did seems pretty on par. Like asking for the history of it, asking to go through like all the the payroll, the, the payments and play the scene right here, where John Lithgow even describes, like, all the different revenue streams that they have.

Scene from The Accountant: Are you aware of Living Robotics, [00:45:00] three income streams.

Scene from The Accountant: Consumer electronics, next generation prosthetics, Unmanned military applications prosthetics division showed tremendous growth over the last ten years. It seems to have matured. Consumer products is your highest source of revenue, followed closely by Defense Department contracts and prosthetics at two and three.

Scene from The Accountant: You are well informed.

David Leary : You have a note about pattern recognition and how that's a real forensic skill. Now, we all can't be the accountant. We all can't. Just in an evening, just start drawing whiteboards [00:45:30] and markers and go through everything. But this makes me wonder, like as AI comes on, you could build an AI accountant at your level, and you could run this in a night and detect anomalies, right? In one evening.

Caleb Newquist: I wanted to look this up because we've talked about this on a couple of past episodes. But it's Benford's law, right? Benford's law is a mathematical concept that's used in forensic auditing and fraud detection. And I remember when I was doing research, I [00:46:00] don't remember the episode, but I remember when I was researching Benford's Law, I asked ChatGPT like. Explain Benford's law to me. Like I'm a, you know, like I'm a grade school kid. And it did a terrific job, of course. And, uh, but you could you could absolutely prompt, uh, an LLM to take the, you know, take that concept, the concept of Benford's law or any, any other concepts or methods that are used for detection. And you could you could coach that, you could prompt and coach that LLM [00:46:30] into, uh, into into having those skills and being able to examine a spreadsheet or whatever and find, uh, anomalies based on, based on those methods, based on those concepts.

Zach: Yeah so basically, just to quickly explain more what David mentioned, and you mentioned, it's like the fact that random numbers, when people are trying to generate random numbers, like pretend that they're coming up with random numbers, they're not random. There's a lot of times patterns in those numbers. People think they're being random. But you know, if you see A15 times [00:47:00] in a row, they automatically go, oh, I have to change that. That would never happen. They don't realize that's as likely as as happening as like a, you know, a seven, four two, four one whatever. Like, you know, every number is completely independent and generated. So most of the time people make up patterns for that.

Scene from The Accountant: You know, say anything.

Scene from The Accountant: Second number in each is a three.

Scene from The Accountant: Yeah. Most people, when generating random numbers, tend to rely subconsciously on certain patterns.

Zach : You know, another thing that you just mentioned, David, it reminds me of something that Blake has mentioned a lot on the accounting podcast with I [00:47:30] it's like with these AI agents, eventually you want it to take a sample for audits. Right now, when you audit something, most of the time you're taking a sample of data. You can't look at all the data because you're never gonna have enough time to do that. But with the help of AI, eventually you could go through every single interaction or transaction, every single payment, every single thing that you've ever done to find the fraud.

David Leary : And to some extent, that's what he did. He had the mental capacity to do that, which he can actually do. Right. You have to take a team of people and you still you're still doing samplings. Yep. And maybe this is the future of of [00:48:00] audit. Like maybe we saw the future of audit. It will be one machine looking at every single thing in an evening. And come back the next day and it'll be, come here and look at this.

Caleb Newquist: It's so funny that you say that, David, because that's one of the first things that I remember thinking when people because you the way audit has worked historically is you can't literally test the entire population of transactions at any business, but with the, with the, with the speed of [00:48:30] technology and an AI that all of a sudden isn't so far fetched. And I think that's, that's that's really kind of a cool thing to think about is the possibilities of, well, how can we use technology to get a, not just a sample, but how can we test all the transactions? And the other thing that I've thought about off and on over the years is does that mean that auditors then could make an assessment whether [00:49:00] a company is free of fraud or not? Or could they or could they, uh, do some kind of an assessment where they have a certain percentage of confidence that the, the corporate that the company's books is, is free of fraud? So, um, yeah, a lot of interesting possibilities.

David Leary : He didn't ask for samples, he asked for everything.

Caleb Newquist: No, I know, I know. Yeah.

Caleb Newquist: Right, right.

Zach : I guess the only other thing that, um, that we talked [00:49:30] about a little bit, but I'll just say it again, is that, um, the movie doesn't show exactly how he stole the money where they were. They were embezzling, but it obviously some type of lack of internal controls must have been going on. Segregation of duties. Very important things to have in any company, especially the bigger the company. It's the basic way to stop fraud. Like if you want to stop fraud, it's the easiest way. That's one of the easiest ways you could do it is just have segregation of duties and internal controls, please. Yeah. What was the thing Greg always used to say? His favorite line. Um, transparency is like the if you want, like, fraud not to happen. Transparency. [00:50:00]

Caleb Newquist: Yeah transparency is, like, as close to a silver bullet as you can have. But I think the other thing, the other thing that we talk about sometimes that was in play here is like management override is always a huge risk. Right. So you've got you've got John Lithgow's character who basically again it wasn't made clear. Did he have his CFO buddy take the money or did he and like and then pump it back in so they could inflate the revenues? Or is it something that he was doing himself or like how it's.

Zach: Like I'm 5050 the CFO, just from the way they describe it [00:50:30] in the movie, the CFO seems like he's very angry that like, you know, Christian Wolff, Ben Affleck's character, is brought in to do this. But I don't know if he's angry because he's like, this is my work and I did a great job. Or if he's angry because, like.

Caleb Newquist: He's he's about to get busted.

Caleb Newquist: Yeah, yeah, yeah. And I think what is and I think here's the important thing here. Here's the qualifier that I will put on internal controls. Internal controls are very important. Awareness of fraud very important. However, management override there is always a risk of management override. So you can't fully eliminate the risk. [00:51:00] But you can put as many processes in place to try to prevent it from happening.

David Leary : Now in a way like if you. The last scene with John Lithgow, um, Ben Affleck replies that it was to get your books tight before you're.

Caleb Newquist: Going stop the leaks.

David Leary : This was almost like a pre audit to see if the auditors would have caught this, right? So then the question is they just hired the wrong guy.

David Leary : They just hire your standard audit and got away with it. Probably they hired the wrong guy.

Zach : So let's let's say this this is a lesson that's not [00:51:30] a good lesson we're going to teach. We're going to teach people.

Zach: To commit fraud here a little bit. Sorry not don't do it. Don't do it. But if you're going to hire someone to do your audit, don't hire the guy that's recommended for how like, you know, the guy.

Zach: With math degrees from MIT and like, you know, there's a scene where they're talking about, like, who he helped before this and how they got his name and the guy they're describing like he ran another company. He's a genius. Like he has a math degree from this company.

Caleb Newquist: That's right.

Zach : Caltech. He went to this company. And Christian, he says, you're the smartest guy he's ever met or whatever. So why are you going to hire that guy.

Zach: To run your books.

Zach : When you know there's fraud going on? [00:52:00] Do not bring in. Do not bring in a skilled auditor.

Scene from The Accountant: Mr. Haqqani holds advanced degrees in mathematics from Cambridge and Caltech. Why does a man like that need you?

David Leary : I think the premise was, if we get it by this guy, we'll for sure get it by the regular auditors in the street and go, maybe. I think that's what this was.

Zach: It is maybe the smarter guy.

Zach : Oh, also, there's a line where basically, why did they decide to kill them? And like, why did they decide to go that route? And John Lithgow goes, I just knew he went [00:52:30] from looking at him in the eyes. I knew he wouldn't let this go.

Zach: Yeah. So, you know, that's John Lithgow.

Zach : You read people that well. I mean, to be fair, Ben Affleck does not like letting things go, so he probably wouldn't have. But that's a pretty bold and insane way to take this, you know, elevate like what's going to happen. It's a murder. After deciding, I just knew he wouldn't let this go.

Zach : I guess he already a murderer. Yeah.

Caleb Newquist: It's like my best friend's got to go. My sister's got to go. It's like the junior accountant is definitely going. If my best friend and my sister are going.

David Leary : And there are definite [00:53:00] principles like he, he, he states he doesn't discuss client business.

Caleb Newquist: That's right. Yeah.

David Leary : And that is a huge principle of confidentiality. He keeps it like that's a that's a huge thing. Accountants need to do.

Scene from The Accountant: I don't discuss client business.

David Leary : The very basic I think it's probably one of the guiding principles of CPAs. I don't know, Caleb. You can answer this or not an ethics thing, right? He tells somebody when he's asked about a client that he does not discuss client business, which I think is probably an important value to have as an accountant.

Zach: Accountants only do that anonymously [00:53:30] on Twitter.

David Leary : On Twitter.

Zach : And honestly on Twitter. That's all they want to do. That's okay. Not to not don't tell them in person about specific clients. But if it's anonymous and on Twitter, talk as much about clients as you want.

Zach: Sorry. Sorry. Go ahead Caleb

Caleb Newquist: No, I mean, that's. I mean, yeah. So accountants. Accountants don't have the. It's not the same level. It's not the same standard as, like, physicians or lawyers or like, clergy or clergy. Like, but they do have there [00:54:00] is a standard of confidentiality. And in some cases they've tried to like when there's litigation, accountants have tried to claim that very, very highest standard. But um, it it's they've for the most part I think they're unsuccessful. But there is but there is a standard of confidentiality that, that accountants do hold and, and. Yeah. And Christian follows it. And I mean he has he has other motives too. But yes. From a professional um, professional conduct [00:54:30] standpoint, he's doing the right thing.

Zach: Perfect.

Zach : All right. Well, that basically wraps up all the stuff about the accounting. Any overall film, things you want to talk about. Did you like the movie? Let's start. Let's start there. David, you like the movie?

David Leary : Yeah. I thought you had to. You have to. I think the theme is like, do you like doing puzzles or whatever that's there? Maybe that's the the tagline on the new movie about doing puzzles, but you feel like you have to do this with this movie because they don't draw the perfect line to the characters. And if [00:55:00] you think about it, there's two brothers that grew up together. They both became gun mercenaries, and they both get hired to either cover up or discover financial crimes. It's very interesting. They have these parallel lives and they're crisscrossing and on who they get hired by. It's for financial related frauds and companies and short stocks and things like that, which I thought was interesting. And then but then you have to really at the end, the scenes really dark at the very end of the movie at the house. And you really have to like, even though [00:55:30] there's a lot of gunfire and action and shooting happening, there's still a lot of dialog that like helps you tie a lot together. But the move in the movie is like putting together a puzzle. You have to really even even now discussing with with YouTube, there's other pieces you're starting. Oh, okay. I see that's tied together. Preparing for this.

Zach: I think it has to do a lot with the way that the scenes are ordered as well, like the flashbacks mixed with modern, mixed with, we don't know, people's relations. Like, okay, well, how does Ben Affleck know Jon Bernthal's character? Like, okay, who are these two kids like the dad? The yeah, there's a bunch of scenes like that where we're just not exactly sure what's going on. [00:56:00] So I'd say, you know, it's been on TV a lot recently with the second one coming out. Uh, so if you watch it a few times, it'll make more sense.

Zach: Yeah, but I don't know if that's necessarily a good thing. I don't know if for a shoot em up, if you want to be like, oh, if you see, like it makes sense after the fourth time.

Caleb Newquist: Yeah. Yeah.

Caleb Newquist: You definitely. I mean, I remember watching it in the theater for the first I've watched this movie about three, 3 or 4 times, and each time going into it I'm like, oh, I don't want to like this movie. It's like.

Caleb Newquist: It's this corny, it's this corny kind of mash [00:56:30] up of accounting and like, yeah, like Chuck Norris or or or Arnold or whatever. Like, like you said, a shoot em up or Bruce Willis, whatever. It kind of made me think about the old Die Hard movies. But anyway, um.

Zach: John Wick meets Rain Man.

Caleb Newquist: Yeah, right. Well, each each each time I got to the end of the movie, I, I ended up just liking it more than I expected to. And so from that standpoint, it's kind of a sleeper because you do kind of think, oh, accounting. And like he's got guns [00:57:00] and stuff, but but I don't know. And like the neurodivergent stuff is really sweet. I like that little subplot in the story. Um, they do a good job with that. And they, they were kind of commended, uh, of how they handled that part of the material. So all in all, um, yeah, I think I think the accountant kind of punches above its weight in that regard. It's it's a better movie than I expected it to be.

Zach : 100% agree. Uh, I think one of the main reasons that might be for that as well is I think this is a fantastic cast. It's [00:57:30] such an impressive cast for what this movie is. Uh, we already talked about most of them, but if we just want to go through it really fast Ben Affleck, Anna Kendrick, J.K. Simmons, Jon Bernthal, Jeffrey Tambor, John Lithgow, um, Jean smart, Cynthia Addai-robinson like, there's just everyone kills it in this. They're great.

Caleb Newquist: David, you guys, you guys are hosting, right? Or is this going to air or is it in time?

Zach: This will come out before. Yeah.

Caleb Newquist: Okay. Yeah. So, David, you guys are hosting a screening down in Scottsdale, right?

David Leary : In Scottsdale. So we are going to host an accountant [00:58:00] two screening for accountants for free. We rented a theater. We have 100 people registered. Popcorn popcorn popcorn popcorn as well.

Caleb Newquist: Oh, good.

David Leary : And we're going to do the whole movie. It should be a lot of fun. And thankfully this movie was released after the tax deadline, so I'm wondering if that was on purpose versus releasing it. If they released it a week before April 15th, we couldn't do this party. We'd have no accountants attending. Every accountant can just [00:58:30] shut their office and go to this movie on Friday when it when it opens up. Yep. So I can tell a story about my hate of Ben Affleck.

Caleb Newquist: Oh my gosh.

Caleb Newquist: Okay. Okay.

David Leary : So for for two reasons. And you can put this in as, like a soundbite at the end. So back in the day when I was at Intuit, I created a product called View My Paycheck, and I was slowly climbing up in the Google rankings and owning the word paycheck. And so if you search for the word paycheck, I was owning the word paycheck. Okay. And then what does Ben Affleck come out and do? He creates [00:59:00] a movie called paycheck.

Caleb Newquist: No.

David Leary : Just takes up the whole. He just wins the search for the word paycheck. 6 or 7 years later, eight years later, I start this podcast called The Accounting Podcast, and Ben Affleck comes out with a movie called accountant and just steals all the SEO. I just can't win with this guy.

Caleb Newquist: That is hilarious.

David Leary : He's brutal.

Zach: Stealing.Yeah, he's stealing SEO. He's stealing the results.

David Leary : Wow.All the accounting word, SEO terms.

Zach : You know, David also was the original Batman.

David Leary : Not the Batman.

David Leary : I have.

David Leary : A [00:59:30] lot of SEO struggles I had. If you Google David Leary Google for years, Google would say you can't be searching for David Leary. You must want Dennis Leary.

David Leary : Oh no.

David Leary : I had to create a website that says I'm David Leary, not Dennis Leary just to like, retrain. Yeah, yeah. But yes. So Ben Affleck has stolen two keywords search words for the accounting industry.

Zach : What a selfish man. And on that note, I think we're good. Everyone, please subscribe to the accounting podcast. Subscribe to my fraud. [01:00:00] Me and Caleb are occasionally going to do these movie ones. Uh, we did one on The Informant. We did this one now, and we're going to do some other ones. If you guys like movies with accountants and fraud, we're get into those.

David Leary : And looking forward to doing this for the accountant two.

David Leary : Hopefully there's accounting stuff. Let's cross our fingers.

Caleb Newquist: All right.

Caleb Newquist: Enjoy.

Zach : Thanks everyone.