MEXICAN TOURISM TO F-H

The Mexican Tourism Board named Fleishman-Hillard, Miami, to succeed Edelman PR Worldwide for a $3M PR program in the U.S. and Canada. Also finalists were Cohn & Wolfe and M. Silver Assocs.

Rissig Licha, EVP/managing director of F-H in Latin America, said the firms gave their final pitches on videotape. Each presentation lasted about 80 minutes, with 20 minutes for a recap. F-H will work with KWE Assocs., New York, which continues to work for the Mexico City Tourism Authority.
F-H handled tourism PR for Mexico in the early 1990s and also currently works for the MCTA.

KWE will manage trade and consumer media relations in the U.S. Formed in 1999, the Tourism Board is part of the Ministry of Tourism, with autonomous management and participation of regional governments and private sector entities.

Hearst Magazines named PMK PR for publicity for Harper's Bazaar and Marie Claire magazines. Leslee Dart, head of PMK/New York, will oversee the account. The appointment was made by Hearst Magazines' president Cathleen Black. Dart said 25% of the account will be on events.

PMK, part of the McCann-Erickson WorldGroup (of Interpublic), said PR has become "indispensable" in the magazine world. PR plays the major role in creating buzz around a magazine, said Women's Wear Daily's marketing/media reporter Janet Ozzard.

Coca-Cola's hard-driving marketing tactics, which brought it a guilty verdict in a Texas antitrust case in June, were described in a full-page+ article in the Aug. 6 New York Times under the headline: "How Coke Pushed Rivals Off the Shelf"... Ruder Finn is suing Renata W. McGriff for an alleged $123,000 in unpaid bills for PR for her website providing New Year's Eve info. RF took the account after it was resigned by Middleberg + Assocs. and Urge PR. More than 14 lawsuits have been lodged... Palm, Inc., Santa Clara, Calif., hand held computers, to The Jeffrey Group, Miami, for PR in Latin America. Also pitching were Burson-Marsteller and Ketchum... Alfred Geduldig of Geduldig & Ferguson, New York, named to Dwight D. Eisenhower Memorial Commission by President Clinton. It is planning a memorial to Eisenhower.

NEW SEC RULE EXEMPTS REPORTERS

The Securities & Exchange Commission, which is tightening its rules to prohibit disclosure of important information to handpicked investors and analysts, will exempt information gathered by reporters.

Senior executives will not be punished for sharing information with reporters and bond-rating agencies. Lower-level employees will remain as free as they are to talk to people outside their companies.

The SEC will spell out who cannot receive material information from corporate officials that is not available to the public. The group will be limited to analysts, brokers, mutual fund managers and other shareholders.

The Securities Industry Assn., trade group of the analysts, believes the rule will have a chilling effect on communications. Despite their opposition, the rule is expected to pass Aug. 10.

NEW YORK DIRECTORY OF PR PUBLISHED

O'Dwyer's New York PR Directory, the first directory of its type since 1997, has been published with listings on 800 New York area PR firms, 840 corporations, 220 trade associations and 528 PR service firms.

It also has a ranking of the 50 largest PR firms, a ranking of 82 firms in the New York area, and a list of 60 area executive recruiters and PR employment agencies. The regional directory is used by job seekers as well as companies seeking PR. It is $50 from the O'Dwyer Co., 271 Madison ave.

IPG CLAIMS DIP IN EARNINGS IS A RISE

Interpublic, in a headline and in a statement as part of a release, claimed that its second quarter net rose 15% to $171.9 million when the actual net declined 9% to $136.8M.

Neither statement noted the effect of $52.8M in charges in the quarter. The true earnings figure is nowhere in the four pages of text of the release, which is preceded by a statement in italics that says: "(All discussions exclude the impact of restructuring and other merger related costs taken in the first six months of 2000...)" The $136.8M figure appears as part of tables on the fifth page of the release.

Some reports had IPG showing a gain in earnings but the Wall Street Journal headlined: "IPG's Net Fell by 9% in 2nd Quarter After Restructuring."

(continued on page 2)

IPG ISSUES FALSE EARNINGS (cont'd)

Bloomberg Leads with Rise; Ad Age Says Gain

A Bloomberg story led with the alleged gain and noted the one-time charge in the tenth paragraph.

The third paragraph of a story on the Reuters wire (that led with the supposed gain) noted the earnings "exclude pre-tax charges of $52.8 million." Both wires are used extensively by media.

The Advertising Age report July 31 said nothing about the $52.8M charge or the real earnings.

It quoted IPG as saying "net income rose 15% to $171.9 million. Revenue was up 15% to $1.4 billion. Revenue from domestic operations increased 20% and from international operations was up 10%." The rest of the item told of the "$900M" in net new business in the half and reported that first half net was up 16% to $230M. Actual first half net was $174.1M., a decline from the $198.7M reported in 1999 (before counting any mergers).

IPG Went "Over the Line," Said Analysts

Analysts and CPAs told this NL that IPG had "gone over the line" of acceptable statement of a one-time charge. Such a charge should be in the same sentence as any hypothetical earnings claim, they said. Busy reporters might not catch the true earnings, which is what happened at Ad Age, they noted. The Bloomberg story noted that IPG's stock has fallen 29% this year. The stock was $58 last December but has been around $40 recently.

The IPG earnings report quoted Philip H. Geier Jr., chairman and CEO, as the source of the information.

A bulletin board posting on Yahoo! Aug. 2 said: "More sellers than buyers and no end in sight. Upgrades were so they could cover their positions while the getting was good. Where's the bottom on this one? 20% discount. I want to pick up more but when?" Analyst James Dougherty of Prudential Securities, who rates IPG "a strong buy," said, "It was a good quarter all the way around." IPG was again said to be "attractive" by Alexia Quadrani of Bear, Stearns & Co.

WSJ SLAPS F&P CLIENT OVER SCARE PR

The Wall Street Journal assailed Fischer & Partners and its client, Aspect Medical Systems, for using scare PR tactics to promote a monitoring device said to reduce the risk that patients may awaken from anesthesia during surgery.

The paper cited doctors and anesthesiologists upset with the aggressive marketing and PR tactics of the manufacturer of the Bispectral Index Monitor.

Roger Fischer, president of F&P, could not be reached for comment. Jim Bardwil, a senior VP, said he could not comment specifically on the PR strategy used to promote the BIS monitor, but added: "We as an agency are very proud of the work we've done for Aspect."

Company Backs Off Claim

Aspect denied ever promising that its device would prevent "intraoperative awareness," but acknowledged that the company was at first promoting the monitor as a means of minimizing the risk of that happening. The company has since backed off that claim.

The controversy centers on Aspect's efforts to distribute a "fact sheet" to reporters and hospitals describing its monitor as a "solution" to the problem of intraoperative awareness. Hospitals which purchase the BIS monitor also receive a "template news release" from Fischer, stating: "Now, with the BIS monitor...the anesthetic provider can fine-tune the amount of anesthetic a patient receives and assure that he or she remains in a deep hypnotic state, unaware of any of the surgical proceedings."

Fact Sheet Is Retracted

In an article appearing on the front page of its B section Aug. 2, the WSJ noted that Aspect has since ordered a halt to the distribution of the fact sheet. The company now maintains that the BIS monitor provides a measure of how awake a patient is, but acknowledged that there is no scientific evidence that it reduces the potential for intraoperative awareness.

FCB NAMES TWO PR DIRECTORS

Stuart Ross was named SVP/director of PR for FCB Worldwide, and Gayle Taryn was appointed VP/director of PR for FCB New York.

Both PR pros will be based at the agency's flagship office in New York at 150 E. 42nd st.

Ross, who will direct media relations and oversee PR efforts of the agency's 200 worldwide offices, will report to Brendan Ryan, CEO, FCB Worldwide.

Taryn, who reports to Jeff Tarakajian, president/ CEO of FCB N.Y., will develop and manage all of FCB New York's PR activities.

Ross, 47, who spent 11 years at PepsiCo, had most recently been VP/PR for Kroll Assocs., a corporate investigations and business intelligence firm.

Taryn, 44, had been a part-time PR director for Gotham Inc. and The Kaplan Thaler Group. She has been handling PR for ad agencies and corporations.

MATTIA, FORMERLY WITH FORD, JOINS EDS

EDS, Plano, Tex.-based E-business and information technology services company, has named Tom Mattia, former VP of PA for Lincoln Mercury, to replace John Lacopo, who retired, as head of global communications.

Mattia, who will report to Don Uzzi, SVP of global marketing, communications and government affairs, had directed international PA for Ford for the past five years.

DEATHS: Fred Rosen, 84, who ran his own PR firm for many years, died June 18 at his home in Water Mill, N.Y... Frank K. Long, 75, an independent PR consultant as well as a senior counselor with Anne Klein & Assocs., Marlton, N.J., died July 30. He was a winner of the national PRSA's Paul S. Lund Award for public service... Karl Vollmer, 85, former copywriter for Needham Harper and consultant to DDB Needham, who later ran his own PR firm in Houston, Omega Assocs., died July 19.

WASHINGTON INSIDERS WEIGH ANCHORS

SWR Worldwide, Washington, D.C., kicked off the first in a series of "reputation polls" by asking 197 senior congressional and executive branch staffers, along with PR executives and political reporters, to pick their most respected journalists on TV.

SWR, an opinion research firm owned by Shandwick International, revealed that Jim Lehrer, host of PBS' "Newshour" beat out all the major network competition with 26% of the respondents selecting him.

Tom Brokaw (NBC) was in a statistical tie with Lehrer with 23%, followed by Peter Jennings (ABC) with 16%, Brit Hume (Fox) with 14%, and Dan Rather (CBS), who only got 10%.

It was not very close in the Sunday talk show classification where NBC's Tim Russert crushed his competitors, with 44% saying they most respected his "Meet the Press" program.

Cokie Roberts and Sam Donaldson were chosen by 20% of the insiders for ABC's "This Week" program and Tony Snow's "Fox News Sunday" was in third place with 10% of the respondents.

Chris Matthews' "Hard Ball" (MSNBC) came out on top in the "political talk show" category with 15% of the respondents. The "McLaughlin Group" was a close second with 12%, followed by CNN's "Crossfire" with 10%.

Greg Schneiders, president, SWR, said the new RePoll survey points out how the "`most watched' journalists are not necessarily the ones insiders are listening to."

In the PA business, it is important to know who is influencing Washington insiders, said Schneiders.

EDITOR FINDS EXECS MORE AVAILABLE

Linda O'Byron, who is executive editor of "Nightly Business Report," said one of the biggest changes in business news since the launch of NBR in 1979 is CEO and business leaders are now more available for TV interviews.

O'Byron, who has headed the editorial team at NBR for 21 years, believes the viewer's experience will be much more interactive in the future, gathering whatever news he or she needs.

She said NBR will provide more information through its website (www.nbr.com) and through digital TV's datacasting.

"We already have a terrific website that has expanded in just one year's time, going from attracting 350,000 page views to over a million each month," said O'Byron, who also believes NBR Enterprises will produce many more business financial programs for TV.

PEOPLE ____________________________

Fred Guterl, formerly with IBM, where he was in charge of Think magazine, an internal publication, and other print and web projects, has joined Newsweek International as senior editor.

Guterl will launch a new science and technology section for Newsweek's three international editions, Atlantic, Asia and Latin America.

Nancy Lindemeyer, editor of Victoria, is leaving to open a jazz club, called The Jazz Bit, on 44th st. in New York. Peggy Kennedy, who is at House Beautiful, is expected to replace Lindemeyer, who has been editor since the magazine was started.

Lisa Lombardi has resigned as editor of Twist, a<%-2> magazine for teens, published by Bauer Publications.<%0>

Felicia Paik, 33, formerly a reporter at The Wall Street Journal, has joined Forbes.com as senior edi<%0>tor.

Jamie Trecker, a former editor of Inside Sports, who started Kick! magazine in the late 1990s (which is now the world's largest-circulation soccer publication), will contribute a weekly column, feature and news stories to SportsTicker, a Jersey City, N.J.-based supplier of real time sports news and information service of ESPN.

Frank Swertlow, an entertainment writer, has joined Sitrick and Co.'s Los Angeles office. He had been covering the entertainment beat for The Los Angeles Business Journal, and he used to write a syndicated Hollywood column for The Los Angeles Daily News. His wife, Mary Murphy, is a senior writer at TV Guide, where he was a columnist and reporter.

FITNESS PUBLISHER TO SHUN GAY SLANT

The publisher of American Health & Fitness, a new magazine, will not slant its editorial coverage to appeal to gay males.

In a letter to prospective advertisers, Robert Kennedy, publisher of the soon-to-be-published magazine, said: "You've probably noticed that many so-called men's fitness magazines are directly geared to the gay voyeur, rather than concentrating on giving scientific fitness training-nutrition advice.

"Whereas we do not want to ostracize the significant gay market, AH&F will not be choosing subjects and models principally for their `gay appeal.'"

Kennedy, who also publishes Muscle as well as women's fitness magazine Oxygen, believes mainstream men's fitness magazines target gays by featuring "wet-lipped men on the cover" to boost newsstand sales.

Scott Seomin, a spokesman for the Gay and Lesbian Alliance Against Defamation, said the implied message in Kennedy's letter is that "all gay men fit a stereotype as sexual voyeurs and advertisers should avoid appealing to our community."

"We believe this sets up gay men for discrimination and tells the advertising community that we are somehow second-class, below a demographically targeted heterosexual community," said Seomin, who also disagrees with Kennedy's claim that mainstream muscle and fitness titles cater to gay men.

(Media news continued on next page)

ON- AND OFFLINE NEWS ARE CONVERGING

Whether driven by the web or heralded by more traditional media and broadcast outlets, today's news reaches the public differently than just a few years ago, and it has become increasingly difficult for PR professionals to navigate the multiple media channels and to decipher how they are connected, according to Luvon Robertson, senior VP, Fleishman-Hillard, New York.

"For PR pros, the challenge is whether a story about the latest medical discovery is best pitched to the source at everyone's fingertips, the Internet, or to so-called traditional media," said Robertson.

Robertson was moderator of the PRSA/N.Y. Chapter's July 26 "Meet the Media" panel discussion, which included Steve Katz, the New York bureau chief of the Fox News Channel, Marian Jones of Fox News.com, and Patricia Olsen, senior producer of CBS Healthwatch.com. About 50 people attended the meeting, which was held at F-H's office.

All three journalists agreed that when pitching a story about the latest medical breakthroughs to the Internet, PR pros need to consider the online outlet's broadcast/print partners because cross-branding relationships are still a work in progress.

Katz said, "You can't assume a story on Fox News Channel will end up on Fox News.com, or that Fox News.com story will end up on TV. Both have separate staff and agendas." He also said the outlets share their story ideas and plans with each other daily.

Jones cited the Concorde crash as an example of how the two mediums work together. "While Fox News Channel provided up-to-the-minute coverage of the breaking story, Fox News.com provided a comprehensive written summary of the events as they became known. The website also included streaming video from the TV coverage," Jones said.

Both Katz and Jones said that if a pitch can pass the "five-minute rule," they would consider doing a story. Meaning if the idea is interesting enough to discuss for five minutes, it probably is compelling enough to warrant coverage.

Katz and Jones are at [email protected] and [email protected].

Site Not as Fast as TV

Olsen said the CBS Healthwatch site is still working out the kinks, and currently cannot turn around news as fast as CBS TV can. The site is aiming to provide coverage of all CBS TV health stories.

Olsen is responsible for coordinating online articles with CBS TV news, and will be the producer of the CBS Healthwatch TV show, currently in the works. Olsen also said the site will undergo a complete redesign in about three months.

On CBS Healthwatch.com, Olsen said the "biggest hits are on health and wellness, such as fitness or sexual health. People tend to go for more upbeat, positive and health trend stories."

The E-mail address is healthnews@mail. medscape.com; fax: 212/760-3141. If the news is very urgent, Olsen can be phoned at 624-3758. Casey is editor of CBS Healthwatch at 624-3737.

MEN'S HEALTH NAMES EDITOR-IN-CHIEF

David Zinczenko, 30, was named editor-in-chief of Men's Health magazine, which is published by Rodale Press, in Emmaus, Pa.

Zinczenko, who replaces Greg Gutfeld, who left, had been editor of the magazine's foreign editions for the past two years, based in Europe.

He plans to bring in "fresh voices, fresh points of view," but will continue to focus on health, fitness, sex and relationships, and personal finance.

LOHSE LEAVES INSURANCE BEAT

Deborah Lohse (pron. "lows"), who has covered the insurance beat for two years at The Wall Street Journal<D>, in New York, will join The San Jose Mercury News<D> on Aug. 7 as a marketing reporter.

Leslie Scism, who is the Journal's "Heard on the Street" editor, is overseeing insurance coverage until Lohse's replacement is named.

Scism, who had covered insurance news from 1994 to 1998 when Lohse took over the beat, can be called at 212/416-3223, but she gave instructions for PR people to fax her information to 212/416-2350.

Breaking news should be faxed to the spot news desk at 212/416-3299, Scism said.

ST. CLAIR NAMED EXEC EDITOR OF PARADE

Bonnie St. Clair, a senior editor, was promoted to executive editor of Parade magazine.

Editor Lee Kravitz said St. Clair, who was overseeing the magazine's automotive issue since 1996, will now assign stories and maintain relationships with current contributors and help attract new writers to the magazine.

PEOPLE _______________________________

The F.B.I. has been questioning a bartender at the Beaches Negril hotel in Jamaica about the disappearance of Claudia Kirschhoch, the editor for Frommer's travel guides who has been missing for more than two months.

After failing a lie detector test, the bartender told the F.B.I. the two had gone out on the night of May 26, but he has denied any knowledge of her whereabouts.

Kirschhoch went to the Sandals Resorts on May 24 as part of a press trip (NL, June 28).

Tom Korologos, 67, Washington, D.C.-based PR pro, and Ann McLaughlin, 58, President Reagan's labor secretary, plan to be married in December. McLaughlin, chairman of the Aspen Institute, recently divorced TV political talk show host John McLaughlin.

CLUETRAIN MANIFESTO HITS MARKETING

Traditional marketing and marketing communications (marcom) come under heavy attack in a new book called The Cluetrain Manifesto, which is a collection of essays that mostly appeared first on the Internet (www.cluetrain.com).

According to Cluetrain (Perseus Publishing) the web is like a giant water cooler where kindred spirits gather and compare notes and "clues" they have obtained. "Spin gets noticed and scorned," it says.

The web "restores the banter of the bazaar" and "tears down power structures and senseless bureaucracies," says Wall Street Journal reporter Thomas Petzinger Jr. in a foreword.

Preventing customers, employees and others from >talking about an organization and its problems is like trying to "sew a fishing net closed," says Cluetrain.

Companies are not conversing with their markets because of "obsolete notions of command and control," says one of its 95 "theses."

Says another: "Companies make a religion of security, but this is largely a red herring. Most are protecting less against competitors than against their own market and workforce."

"Arrogant" Marketers Blasted

One essay covers the "arrogance" of marketing, its mania for "positioning," and the contempt some marketers have for their "target" audiences.

Quoted are the "five basic principles of the mind" as provided by author Jack Trout in The New Positioning: "1. Minds are limited; 2. Minds hate confusion; 3. Minds are insecure; 4. Minds don't change; 5. Minds lose focus."

"In short," says Cluetrain, "minds are so pathetic that they desperately need help, even if it comes in the form of an axe" (i.e., a giant ad/marketing campaign that captures the minds of the masses).

Most company websites are no better than their brochures, says Cluetrain. "Visitors have to click through screen after screen of fatuous self-praise to find the few bits of information they really want."

PR, Single Spokesperson Are Hit

"PR does not relate to the public. Companies are deeply afraid of their markets," says another thesis.

The "single spokesperson" approach, in which only PR can talk to the press, only IR can talk to the financial markets, and only the CEO can talk to the Wall Street Journal<D>, is blasted.

Employees and others related to the company are already in the "market conversation" and there's no way to "shut them up," contends Cluetrain. Companies can't make employees deliver a corporate "message" because "we're all superb at sniffing out the shills," it adds. "PR has a huge PR problem: people use it as a synonym for BS."

Authors are Doc Searls, senior editor, Linux Journal; David Weinberger, who has written for the New York Times and is a commentator on National Public Radio; Christopher Locke, writer for Forbes, Byte and Industry Standard, and Rick Levine, web architect formerly at Sun Microsystems.

SZ&M PRESIDENT DEFENDS FIRM'S WORK

David DePinto, president/CEO of Stoorza, Ziegaus & Metzger, San Diego, said his firm has handled PR for the California Insurance Education Project on an ethical basis.

DePinto denied published reports and rumors that the firm had misspent PR funds for the project.

On Aug. 1, the California Insurance Education Project, which was administered by SZ&M, filed a request for voluntary dissolution in consultation and cooperation with the Attorney General's office.

As a result, the state Attorney General, Bill Lockyer, has ended his investigation, without finding any wrong doing of SZ&M's management of CIEP.

CIEP was established as a charitable foundation by Chuck Quackenbush, the state insurance commissioner, at the suggestion of SZ&M, which was paid $50,000 to organize and recruit board members to run the project, and $25,000 per month to manage CIEP's activities.

After the petition was filed Aug. 2 in Sacramento County Superior Court, Lockyer issued a statement, saying his office had "concluded" its investigation into CIEP.

Lockyer said: "I appreciated the responsible decision that the CIEP has made to seek voluntary dissolution of its non-profit corporation.

"Over the last few weeks, the corporation has cooperated with my office in our ongoing investigation into the Northridge insurance settlements and related Department of Insurance activities.

"Upon placing its remaining assets in the care of the court, our civil investigation into CIEP will have concluded and our concerns regarding the potential civil liability of the corporation will have been addressed."

The foundation is one of many non-profit corporations created by Quackenbush, using Northridge earthquake insurance company penalties. Quackenbush, who is currently under investigation, resigned in June.

The Los Angeles Times reported last April only a small percentage of the foundation's $1.3 million was being spent on the projects it was designed for. The Times said most of CIEP's money was being spent on SZ&M, which "came up with the idea and chose the foundation's board of directors."

PAUL IS JOE FRAZIER'S NEW SPOKESMAN

Mike Paul, president of MGP Sports PR, New York, has been retained as the new spokesman for Joe Frazier, the former heavyweight boxing champ.

Frazier's family and friends attended a press screening of HBO's "Ali-Frazier 1: One National..Divisible" in New York on Aug. 2.

Paul said Frazier will be pursuing business opportunities around the world, including endorsements and other business ventures.

Michael Bloomberg, who heads Bloomberg News, Princeton, N.J., may run for mayor of New York. Bloomberg has registered nearly 50 website domain names, such as "mikeformayor," "bloombergformayor," "mayormike," "yesformike," etc.

The "old marketing" and the "new marketing" are contrasted in this issue.

The old marketing is Interpublic (page one) stating twice in an earnings release that earnings for the second quarter were up when they were down.

If a baseball team did what IPG did, here's how the release would read:

"Yankees beat Red Sox 10-9; discussion below excludes unearned runs by Red Sox."

We would only learn in the box score that the Yankees lost 11-10!

Symptomatic of the old-style IPG command-and-control approach is that there is no one to talk to at IPG about this release or any topic, for that matter. The company has no IR or PR person. No executive could be reached last week for a conversation, although The Cluetrain Manifesto (page 7) says "markets are conversations." IPG has already refused to identify any but a few of the 56 companies it acquired last year. This compilation is needed if IPG's sales and earnings are to be properly evaluated.

Marketers want broad "messages" to go out and don't want to undergo detailed questioning. But this is exactly what the web is about, says Cluetrain. One of its principal theses is, "There are no secrets."

IPG has a big problem. Its stock has flopped from $58 to $40 after acquiring for $675 million a collection of research companies flying the banner of NFO Worldwide that one critic labeled "a dog" because of lack of earnings and heavy competition from companies using cheaper web research techniques.

IPG, besides baldly mis-stating its earnings, engages in other communications ploys that show contempt for the marketplace. It refers to "net new business" of $900 million in the second quarter when this is really closer to $90M on the basis of how it states revenues ($1.4 billion for the first quarter). It provides no proof of the claimed new business (lists of new accounts, dollar amounts, and the same for accounts lost). Also, it does not provide a balance sheet with its earnings, although most companies do so. Get it yourself from the SEC, it says. Usually, IPG and Omnicom file their balance sheets on the last possible day which can be nearly two months after their earnings come out.

"Companies are deeply afraid of their markets," says Cluetrain and that is what is going on here. IPG and others are afraid of the level of detail required for a conversation. They're afraid of losing control. But another Cluetrain thesis is this one: "Lack of open conversation kills companies" (and associations, we might add).

Hyped figures also hurt PR rankings. The manic quest of the ad conglomerates for ever-rising big numbers has hurt the credibility of the PR counseling industry, where 13 of the 14 biggest PR firms are owned by the conglomerates (IPG owns Weber, Shandwick, Golin/Harris, etc., with $400M+ in fees).

The ad agency PR units have gotten together in the Council of PR Firms and decided that "PR fees" can include up to 49% in ad commissions; no documents such as income tax returns and W-3s are required, and no confirming statements are needed from outside CPAs. Happily, more than 150 PR firms ignored the Council's cheesecloth rules (which it urges on the entire counseling industry) and supplied the easily available W-3 forms and top pages of their income tax returns to PR publications.

The $240,000 revamping of PRSA's accreditation test is focusing on 12 "work categories" that are involved in all types of PR such as account management, project planning, strategic planning, media relations, press conference management, community relations, etc. There would be no testing of skills in subject areas such as high-tech, healthcare and financial. Counting the projected new APR total of 230 PR pros in 2000, a total of 2,320 APRs have been created in the nine years since 1992 at a net cost of $1,897,427 or $817 for each new one (beyond any fees paid by the APRs). A good question is how many of these expensive APRs remain with the Society?

Evidence is that three, and not two, district directors of PRSA could not be found by the nominating committee headed by Mary Cusick. California counselor David Simon switched (illegally, say critics) from "open" director to the Western district director spot left vacant by Ralph Kam of Hawaii. There are ten "district" directors and two "open" directors. Carole Gorney and Michael Jackson have been nominated as the two "open" directors, one of them replacing Simon. There are also no directors so far from the Northeast and North Pacific districts.

CPAs who have looked at the new audit of PRSA, which finally recognizes a liability for future services, say that once a discrepancy has been found, the entire amount should be counted. PRSA is now taking $425,309 in deferred dues but this should be about six months' dues or $1.65M, say the CPAs. This would give PRSA a big loss in 1999 but would help future reports, they say. The CPAs are also mystified by the $993,437 in computer equipment claimed by the audit, pointing out this is an "astounding" $25,000 in computers for each of the 40 employees.