The eight page weekly is the only PR newsletter on LEXIS/NEXIS.
Edition, May 17, 2006, Page 1
H&K LANDS $4M AFGHAN PR
Hill & Knowlton has
enlisted in the State Departments PR efforts in Afghanistan,
where the war on terror and war on drugs
The WPP Group unit was
selected from an RFP process begun in February as the State
Dept. looked for a firm to lead a complex $3.8M PR effort
targeting Afghan citizens and stakeholder groups to dissuade
farmers from cultivating poppies and boosting the global
Wendy Hutter, director
of U.S. business development/marketing for H&K, said
the firm had not yet been notified by the State Dept. and
declined to comment.
Under the governments
full and open competition process, competing
firms for the account are not divulged.
Poppy production has surged
since the U.S.-led coalition in 2001 toppled the Taliban
regime, which was averse to poppy growing. Last year, 86
percent of the worlds heroin came from Afghan poppies.
Based on the work outlined
in the RFP, H&K is required to deploy communications
efforts through seven Afghan provinces, in the Dari and
Pashto languages, as well as to maintain three communications
professionals with Afghan experience to build capability
within the Ministry of Agriculture, Ministry of Interior,
and Ministry of Counter-narcotics.
It also wants the firm
to develop communications offices for each ministry, each
with a trained and skilled Afghan staff of at least two
The Rendon Group has worked
on anti-poppy PR for the U.S. government in Afghanistan
in the past.
UTAH TARGETS TEEN DRINKING.
Utah is looking for a PR firm to develop a media campaign
to cut underage drinking by half in the Beehive State.
The firm will alert parents/guardians about how alcohol
consumption harms a teens developing brain and increases
the chance of addiction later in life.
The Utah Dept. of Alcoholic Beverage Control Commission
wants parents to move beyond the notion that drinking is
a rite of passage.
The PR firm will encourage them to become more involved
in their kids lives. That is a powerful influence
in a childs decision to remain alcohol free,
according to the RFP (#NO6576).
The one-year budget is pegged at $1.4M. The contract may
be extended on a year-to-year basis for four additional
The campaign is to begin by Aug. 25.
IPG LOSES ANOTHER $182M.
Interpublic CEO Michael Roth reported a first-quarter $182M
net loss compared to $151M for the year earlier period.
Revenues were flat at $1.3B.
IPG, according to Roths May 9 statement, must
build on top line momentum, as well as focus on addressing
costs. He warned that the bar on organic revenue will
be high for the next two quarters due to clients lost in
2005. That makes organic revenue growth challenging.
Professional fees mostly related to IPGs restructuring
were up 21 percent to $91M. Roth expects a decline
in those fees for the full year.
IPGs stock trades at $9.93. The 52-week range is
$13.40 and $9.08.
DOWIE SUIT DROPPED.
A U.S. District Court judge has tentatively dismissed a
wrongful termination lawsuit filed by Doug Dowie, the former
head of Fleishman-Hillards Los Angeles office.
Dowie claimed he was being scapegoated by F-H to cover
up illegal payments made by the Omnicom unit to politicos.
Michael Faber, Dowies attorney, called the dismissal
Dowie and John Stodder are waiting for a jurys verdict
on charges they bilked the Los Angeles Dept. of Water and
Power of more than $300K.
CPA PROFS RAP PRSAS
Three CPA professors, shown the 2005 audit of PRSA, dispute
key parts of it, particularly PRSAs policy of booking
dues as cash rather than deferring the income over the next
The standards of accounting call for full, fair and
adequate disclosure, said professor Phil Wolitzer
of Long Island University, adding: I dont particularly
see it here.
The CPAs, two of whom were quoted in a Feb. 9 Wall Street
Journal article critical of Omnicoms financial statements,
said the income should be booked ratably over
the course of the year.
Doing so would cut PRSAs claimed net assets
of $2,637,058 by at least $1.6 million to a little over
$1M. Assets would thus be a comparatively small percentage
of PRSAs annual costs of $9.9M.
The other professors consulted were Edward Ketz of Penn
State and Charles Mulford, Georgia Tech.
(continued on page 7)
Edition, May 17, 2006, Page 2
F-H LANDS D.C. DISASTER PREP
won a competitive pitch to develop a multiyear PR plan highlighting
the National Capital Regions preparedness for a disaster.
Funds for F-Hs contract
(budget is about $100K) are drawn from a federal Dept. of
Homeland Security grant, according to Brian Worthy, a public
information officer for Fairfax County, Va., which issued
the RFP on behalf of the region.
Eleven firms pitched,
including BETAH Associates, Inc., Comunicad, Inc., CRT/tanaka,
Leapfrog Solutions, Mind & Media, Inc., MRC3 Media,
Ogilvy PR Worldwide, Terrorism Research Center Inc., Weber
Shandwick, and Widmeyer Communications.
The Fairfax County Office
of Public Affairs is overseeing the contract.
Worthy said F-H has been
charged with developing a strategic communications plan
for the NCR, which encompasses Washington, D.C., and surrounding
areas in Virginia and Maryland.
F-Hs work involves
development of the plan, not implementation.
The RFP was issued in
January after federal and local institutions were lambasted
for the Gulf Coast response to Hurricane Katrina. It
is clear from the pointed questions raised after Katrina
that many members of the public and the media remain unaware
of the NCRs disaster preparations, read that
KREIDER JOINS GORES
Kalee Kreider, a former Fenton Communications senior VP,
has joined Al Gores Nashville, Tenn.-based braintrust
as communications chief.
She has significant environmental bona fides, earned from
stints at Greenpeace and the National Environmental Trust.
At Fenton, Kreider did PR for Energy Future Coalition,
Environmental Media Services, MoveOn.org, Win Without War
and True Majority.
Kreider is to help Gore handle the media as his book, An
Inconvenient Truth, about the dangers of global warming,
is released this month.
She also could play a PR role if the former Vice President
poses a challenge to Sen. Hillary Clinton for the Democratic
nomination for president.
McDonalds has established a global moms panel
to get input on lifestyle initiatives, restaurant communications
and childrens well-being.
The nine-member group includes women from the U.S., U.K.,
Argentina, China, Germany and Italy.
The American contingent includes Bonnie Blair (Olympic
speedskating champion), Michele Borba (author of 12
Simple Secrets Real Moms Know), Kim Carter (librarian
and Parent Teacher Assn. president) and Laura Lopez Cano
(artist and recent fellow at the National Hispana Leadership
The panel works with Mary Dillon, McDonalds global
chief marketing officer.
JSH&A Public Relations, which was founded in 89
by GolinHarris Communications veteran Jonni Hegenderfer,
does PR for the moms program.
NATIONAL BYWAYS SEEKS PR ADVICE.
The National Scenic Byways Program, a federal government
project encompassing 30,000 miles of scenic and All-American
roads in the U.S., is seeking the help of a PR firm to develop
a public awareness plan for its Duluth, Minn.-based operations
Under the Federal Highway Administration, the NSBP Resource
Center promotes, plans and preserves the national network
of historic and scenic byways. It has allocated a $125K
budget to hire a firm for development of a three-year plan
to help bring public exposure and increased recognition
to the Americas Byways brand, according
to an RFP obtained by ODwyers.
The Byways program, which was created in 1991 and gained
steam in the 1990s, includes roadways based on trails with
archaeological, cultural, historical, natural and recreational
features. The 518-mile Seaway Trail through New York and
Pennsylvania from the St. Lawrence River to Lake Erie, San
Juan Skyway (Colorado), and the Historic National Road,
the first federally funded road in the U.S. (Maryland),
are among the highlights on the Byways list.
Proposals are due June 6. Henry Hanka ([email protected])
is taking questions. Finalists will be offered a $2,500
traveling stipend to pitch in Minn.
EDELMAN VOUCHES FOR ASPARTAME.
Edelman is promoting the European Food Safety Authority
report re-confirming the safety of low-calorie sweetener
aspartame on behalf of Merisant, which markets aspartame-based
Equal and NutraSweet.
The EFSA study followed a report by Italys Ramazzini
Institute that linked aspartame consumption with an increased
risk for leukemia and lymphoma. The EFSA determined that
the Ramazzini investigation contained flaws that brought
into question the validity of its findings.
A New York Times editorial (Feb. 21.) cited the Ramazzini
report and recommended that readers concerned about the
safety of aspartame try products sweetened with sucralose
(Splenda). RF|Binder Partners handles Splenda, a product
of Johnson & Johnsons McNeil Nutritionals unit.
QORVIS TAKES SIDE IN IMMIGRANT
Qorvis Communications is representing the Agricultural
Coalition for Immigration Reform on the immigration overhaul
The firm is pitching Craig Regelbrugge, co-chair of ACIR,
and his message that the U.S. requires a steady supply
of agricultural laborers to keep American agricultural products
affordable for the American consumer.
Regelbrugge also is senior director of government relations
at the American Nursery & Landscaping Association.
The nursery and landscape industry employs 600K people
during peak seasons. The ANLA has posted a tip sheet called
How do you respond when the Dept. of Homeland Security
shows up at your farm, ranch or business? Cooperate,
but ask for identification is among those tips. The ACIR
is a group of ranchers, businesses and farmers working to
overhaul the H-2A temporary and seasonal alien agricultural
Edition, May 17, 2006, Page 3
NEWSPAPER CIRCULATION DROPS.
The average daily circulation
of more than 700 print newspapers tracked by the Newspaper
Assn. of America saw an average 2.5 percent decline in readership
for the six months ended March 31. That sag comes as more
readers have turned to the web for news.
The San Francisco Chronicle
and Los Angeles Times posted declines of 15.6 percent and
5.4 percent respectively, while USA Today and the New York
Times rose slightly at 0.1 percent and 0.5 percent. The
Washington Post took a 3.7 percent hit and the San Jose
Mercury News, a McClatchy Co. paper on the block, dropped
AOL CUTS 1,300 WORKERS.
Time Warners AOL unit is cutting 1,300 employees
and closing a call center in Jacksonville, Fla., in a bid
to rebalance its work force.
AOL claims better online service has reduced the need for
human contact by either phone or e-mail. It says eight million
users a month use its online tools, while 5.5M people contact
an AOL service rep.
The company has 18.6M subscribers, which is down from a
26.7M peak in 02. That plunge is due to customers
switching to broadband from dial-up.
AOL is also reducing staff in Utah and Tucson. The cutbacks
represent seven percent of its workforce.
SMULYAN EYES EMMIS TAKEOVER.
Jeff Smulyan, CEO of Emmis Corp., has put together a $570
million buyout package for the radio broadcaster. The company
plans to establish an independent panel of directors to
consider the bid by Smulyan, who owns a 17 percent Emmis
Indianapolis-based Emmis owns 25 radio stations in markets
such as New York, Los Angeles, Chicago and Phoenix. The
broadcaster is in the process of selling its TV station
group, having lined up takers for 13 of its 16 stations.
Emmis' 2005 revenues were up 10 percent to $387M. Operating
income tumbled to $39M from $73M due to a weaker radio ad
environment and higher promotion/programming costs.
CJR TAKES ON WHITE HOUSE PR.
The Columbia Journalism Review says the White House PR
offensive about the press not reporting good
news coming out of Iraq is an affront to those
reporters who are risking life and limb to cover this story.
In its May/June editorial, CJR says the fact that Iraq
lacks the basic services for a civil society to function
is news by any standard.
The President, when he talks about progress in Iraq, fails
to mention that oil and electricity production and the availability
of household fuel are lower than they were two years ago.
The number of Iraqis killed by insurgents has tripled during
that period. Nearly nine-in-ten Iraqis (87 percent) want
a concrete timeline for a U.S. withdrawal, notes CJR.
The magazine concludes: Indeed, lets have all
the context in Iraq.
EGAN STARS ON
New York's Edward Cardinal Egan promises to make exclusive
appearances on the Catholic Channel that Sirius Satellite
Radio plans to launch in the fall.
The 24/7 operation will feature call-in shows in which
viewers can comment upon Church policies and current events.
There will be programs offering religious guidance, sacred
music as well as a daily mass from St. Patrick's Cathedral.
Vatican Radio will get airtime on the CC.
The new station joins Sirius' other religious programs
including FamilyNet, the broadcast arm of the North American
Mission Board of the Southern Baptist Convention, which
features Pat Robertson's "700 Club."
Sirius is the home of shock jock Howard Stern.
ROLLING STONE FETED FOR RENDON
Rolling Stone notched an American Society of Magazine Editors
award for reporting excellence for its The Man Who
Sold the War piece written by former CIA official
James Bamford that profiled John Rendon. The article ran
The Rendon Group CEO heads the Pentagons go-to
PR operation. It was hired by the military shortly after
the Sept. 11 attacks.
RG produced the liberation of Kuwait City and
kept the Iraqi National Congress relevant during
the run-up to the second invasion of Iraq by U.S. forces.
The reporting category honors the enterprise, exclusive
reporting and intelligent analysis that a magazine exhibits
in covering an event, a situation or a problem of contemporary
interest and significance.
Said ASME: Reporter James Bamford delves deep into
the crossfire of the war of information and imagery to expose
the work of the most secretive and effective
tacticians of the endless Iraqi conflict. The Man
Who Sold the War, a massive reporting effort that
includes a rare interview with General John Rendon, provides
a glimpse into covert trading of rumors and information
in order to go to war.
The ASME award ceremony was held May 9 at New Yorks
Lincoln Center. The awards are a partnership with Columbia
Univ. Graduate School of Journalism.
YAHOO TELEMUNDO FORMED WITH
Yahoo has merged its Spanish language operation with NBC
Universals Telemundo Hispanic TV network to form the
Yahoo Telemundo website. The revamped site replaces Yahoo!
en Espanol and telemundo.com.
The deal provides Yahoo access to Telemundos original
telenovela, news and sports programming, while
Telemundo benefits from the tech prowess of the Internet
More than 11.5M Hispanics visited all Yahoo sites in March.
Yahoo en Espanol attracted 500K-plus visitors.
Time Warner has purchased Liberty Medias 50 percent
stake in Court TV for $735 million. Court TV, which will
generate 06 revenues of nearly $300 million, will
be merged into TWs Turner Broadcasting System group.
(Media news continued
on next page)
Edition, May 17, 2006, Page 4
HINDERS PD EFFORTS.
General Accountability Office reports that fear of terrorism,
shortage of Arabic speakers and assignment of public diplomacy
officers to temporary duty in Iraq are hampering
U.S. outreach to the Arabic world.
embassies have been turned into fortresses as 80 percent
of them rate a terror attack as either critical or
of concrete barriers, restrictions on pagers/cellphones
and requirements for armed escorts, however, have the ancillary
effect of sending the message that the U.S. is unapproachable
instance, the GAO reports that the U.S. Information Center
in Pakistan averages one visitor a day because many past
visitors were humiliated by the embassys rigorous
Hughes, the Undersecretary for PD and PA, wants to step
up development of American Corners outside Embassy
compounds, but one official described that plan as doing
PD on the cheap.
GAO found that the State Dept. falls well short of filling
language-designated jobs. Nearly 40 percent
of those posts in the Arab world are held by people not
fluent in Arabic. An additional problem: few PD officials
want to serve in the Muslim world. During
States summer posting cycle, jobs in the Muslim states
received 3.7 bids per-position compared to 8.9 bids for
GAO reports that the U.S. Arab-language magazine, Hi, had
few readers. An official in the Cairo embassy said he distributed
2,500 copies of the magazine to newsstands. At least 2,000
were returned unsold.
which was supposed to create a positive image of the U.S.
among Arab youth, has been put on a hiatus.
MWW TAPS EDITOR FOR CONTENT
MWW Group has tapped Baseline
Magazine senior writer Larry Barrett as the first member
of the firms content creation team, based
in San Francisco.
MWW president Michael
Kempner said Barrett will be focused on staying abreast
of trends and breaking developments in business and technology
to create content and counsel clients.
Prior to five years at
Baseline, Barrett was senior editor and writer for CNET
Networks in a five-year career. Earlier, he was a technology
reporter for the San Jose Business Journal.
Luhn has been promoted to director of booking for
FOX News Channel, overseeing the weekday and weekend editions
of Fox News Live and managing booking units
in New York, Washington and Los Angeles.
She had been director
of booking for FNC's D.C. bureau and has been with the network
since its inception in 1996, after starting a career in
PR in Austin.
Harbrecht, executive editor of BusinessWeek Online,
has joined The Kiplinger Organization in Washington, D.C.,
as new media editorial director. He will focus on content
and design of Kiplinger.com, the portal which includes the
Kiplingers Personal Finance and Business Forecasts
Harbrecht had been with
BusinessWeek since 1986, when he began as a Washington correspondent.
He moved to the digital side in 1999 after serving as Washington
Goldberg is the latest entertainer to enter the radio
arena. The actress has signed on to host a morning-drive
radio show, Wake Up with Whoopi, for Clear Channel
Communications starting July 31. The program will run from
5 to 9 a.m. nationwide on adult contemporary stations. CC
noted that the morning daypart has struggled to pick up
female listeners in recent years.
Cooper will do five reports for CBS News 60
Minutes program beginning next TV season. CNN, in
turn, will have the one-time rebroadcast rights to the program.
Cooper will remain anchor of CNNs Anderson Cooper
Anderson, who has ten years of Los Angeles TV news
experience, has opened LizMedia in the City of Angels. She
is calling her venture a "television-to-go" boutique
production company that will round up the best talent in
the city to get results. Prior to opening LM, Anderson was
a senior producer for Medialink. More info is at www.lizmediainc.com.
New York Times has expanded its Automobiles
section online to follow the boost of its print edition.
Exclusive content like car reviews, video features and a
directory of car clubs are part of the update.
Rotating topics include
Motoring, which includes consumer advice on
buying, leasing, insurance and maintenance, GreenTech,
environmental auto issues, Wheelspin, news for
car enthusiasts, Handlebars, focusing on motorcycles
and scooters, Technology, Collecting,
Pro Magazine said it will launch a European edition
in September to tap the burgeoning poker market overseas.
The publication will be
sold at retail outlets like One-Stop Stores, Rippleglen,
and Balfours, and will be available at casinos and cardrooms
in English-speaking Europe.
The magazines publisher,
Dan Jacobs, said it will hit newsstands with the largest
circulation of all poker magazines in the U.K.
Corp.s MySpace.com site, which has more than
75 million registered users, will offer free downloads of
Fox TVs hit show, 24.
Burger King is sponsoring
the programming because a lot of its customers spend time
on the social networking site, according to Gillian Smith,
BKs senior director of media. MySpace says future
programming may not come exclusively from Fox, its sister
News Corp. paid $650M
for MySpace last year.
Edition, May 17, 2006,
OF PR FIRMS
EMPLOYEE RETENTION IS TOP
Worldcom PR Group, a global network of independent firms,
said the top issue keeping midsize PR firm owners up at
night is the recruitment and retention of good employees,
according to a survey of its members. Maintaining client
relationships/client satisfaction was second, followed by
business wins and profitability, cost of doing business
and employee benefits.
percent of the more than 50 senior PR execs responding to
its annual survey have clients who are optimistic
about their respective business climates for the remainder
found the most important client deliverables from PR firms,
according to survey respondents, were strategic counsel
and publicity, followed equally by marcom
support and lead generation.
FIRMS OFFER CAUSE MARKETING
A group of marketing firms
and services company have banded together to offer a $100K
grant of communications services to product a cause marketing
campaign for a non-profit entity.
Participants include Medialink
(broadcast and broadband services), Peppercom (PR), Quality
Letter Service (print and direct marketing), Bemporad Baranowski
Marketing Group (branding), Slam! Media Group (A/V production)
and U.S. Newswire.
The BBMG Its
How We Live Grant is looking for applicants who can
show the potential for impact on a targeted cause and business
goal, commitment level of its team, availability of existing
communications channels, and cultural relevance, among other
New York-based lifestyle marketing firm Cornerstone has
added a PR unit under the direction of Ed James, formerly
a SVP for the Morris and King Co. Cornerstone focuses on
marketing music, film and consumer products to the 15-34-year-old
George, former national advertising director for
Planned Parenthood Federation and a VP for Beneson Janson
Advertising in Los Angles, has set up By George & Co.
in New York to focus on communications for the non-profit
sector. George noted fragile finances and traditional
formulas have limited non-profit messaging. She said
the new firm has the team to counter that trend. 917/523-5029,
www.bygeorgeandcompany.com. ...Three-year-old integrated
marketing and PR firm Public
I Partners in Princeton, N.J., has relaunched as
Resound Marketing. ...The
Abernathy MacGregor Group is advising Sheboygan,
Wisc.-based L. French Automotive Castings through Chapter
11 bankruptcy. ...CooperKatz
& Co. marked its 10th anniversary on May 1. The
firm was started in 1996 by Burson-Marsteller vets Andy
Cooper and Ralph Katz with the Association of National Advertisers
as its only client. The two cited the firms independence
as a key factor in its success as it grew to 18 employees
and $2.8M in billings in 2005. ...Allen
& Caron, an Irvine, Calif.-based IR and financial
comms. firm, has opened a Paris office under Patrick Lauriére.
and De Plano Group,
New York/Benihana, for a strategic and internal communications
campaign as the restaurant chain refurbishes about two dozen
restaurants with a contemporary Japanese look and
Media, New York/Dotster,
Inc., Internet domain registration, for PR.
New York/Midwest Airlines, for ongoing PR.
New York/J.H. Cohn, independent accounting and consulting
firm, as AOR for integrated marketing.
New York/AlphaTrade.com, real-time financial info for investors,
for PR and financial communications programs.
PR, Rockville Center,
N.Y./ Cholestech Corp., to promote its branded medical diagnostic
& Co., Elmira,
N.Y./Hardinge Inc., $290M material-cutting company, as AOR
Mason Onofrio PR, New Haven, Conn./The United Illuminating
Co., electricity utility, for media relations, event management
and strategic comms.
N.J./Leica Sports Optics, as AOR for PR.
financial technology services, for international communications,
Voxant, open distribution network for online video news,
for introduction of the company and ongoing
Cary, N.C./Supply Chain Consultants, supply chain software
and consulting, for PR.
Plantation, Fla./ Avisena, healthcare management, for PR,
public affairs and media relations; Forkosh Development
Group, for its Solis Resort, Spa & Residences (Sunny
Isles Beach, Fla.).
Fla./ Launching the Magic Johnson Travel Group, travel consortium.
Services, Grand Rapids,
Mich./Wood Classics, teak garden furnishings, for strategic
planning, direct marketing and PR.
Louisville, Colo./Far East Energy Corp., for production
of a corporate profile for its IR program.
Beverly Hills, Calif./Imperia Entertainment, for PR and
media relations at the Cannes Film Festival (May 17-27)
in support of its feature film Say it in Russian.
Group, Santa Monica,
Calif./Los Angeles Orthopedic Hospital; New Balance Los
Angeles and FrontRunners, for an integrated marketing campaign,
and CarMD, for PR, website creation, SEO, and print advertising.
A new client of Cognito was misspelled in the 4/26 edition.
The client is Pyxis Mobile, not Phyxis Mobile.
Edition, May 17, 2006, Page 6
MINDSHARE ACQUIRES CONSULTING
Interactive Campaigns, Washington, D.C., has acquired Texas-based
web consulting shop RampWEB, which focuses on web accessibility
services for government agencies and contractors, universities
said it adds capability to make websites more accessible
and compliant with federal law (Section 508) and international
Wahblin, CEO and founder of RampWEB, takes the title of
director, user experience at Mindshare.
Thatcher, who helped develop the federal 508 standards,
and John Slatin, founding director of the Accessibility
Institute at the Univ. of Texas at Austin, will continue
their affiliation with RampWEB under Mindshare.
KEF MARKS 20 YEARS.
Kevin Foley, who launched
broadcast PR company KEF Media Associates in Chicago on
May 1, 1986 "with no employees and no clients,"
marked the firm's 20th year with a party at its expanded
headquarters, now in Atlanta.
A former account group
manager for Burson-Marsteller and Ketchum, Foley moved the
company to Atlanta in 1993 and oversaw its growth to nearly
40 employees with corporate clients like Coca-Cola, Home
Depot, State Farm, Purina, and agencies like Manning Selvage
& Lee, Cohn & Wolfe, Ketchum, Weber Shandwick, Golin
Harris and CKPR.
Bob Cohn, founder of Cohn
& Wolfe, Ellen Hartman, managing director of Weber Shandwick's
Atlanta office, and Bill Marks who heads up GCI Groups
technology practice, were among attendees.
The founding principle
was to apply our understanding of the PR discipline to the
practice of producing and placing sponsored news content
for our clients, said Foley, who has staunchly defended
the broadcast PR sector in the face of recent criticism.
Carly Norausky, business development ma ager at MLR
Design in Chicago, has joined WestGlen
Communications as a senior account director in the
Windy City. She has agency experience with Fleishman-Hillard
and Margie Korshak Inc. ...Bob
Hill, executive producer for News
Broadcast Network, won four Telly Awards at the annual
confab. Hill earned silver for an American Society of Anesthesiologists
VNR on gastric bipass surgery, and three bronze awards.
...Denham Springs, La.-based Metro
Press Clipping Bureau won a $5,654, one-year contract
with the Louisiana Governors Office to track national
and local newspaper coverage. ...Marcus
+ Co., a Boston-based company which develops award
and retention programs, has been tapped to manage judging
for the 2006 Oracle Titan North American Partner Awards.
Marcus will develop scoring sheets and judging kits, oversee
the process and certify results. Winner will be announced
at Oracles OpenWorld event in October.
Acevedo, VP at Euro RSCG Magnet, to Kwittken &
Co., New York, as managing director. She was in Magnets
corporate and financial practice. Carrie
Gilman, A/E, Joele Frank, Wilkinson Brimmer Katcher,
has joined as an associate.
Kelly, independent consultant, to pharmaceutical
company Inyx, Inc., New York, as VP of IR and corporate
communications. Prior to 10 years handling a variety of
pharma sector clients, Kelly was a full-time consultant
for Bristol-Myers Squibb and earlier was a VP for J.P. Morgan
Talmud has left Matlock Advertising & PR for
a senior A/E post at Bridgewater, N.J.-based R&J PR.
She handles Integrity House and The N.J. Fire Sprinkler
Blakeman, president of Kent Strategies, to Gordon
C. James PR, Washington, D.C., as a senior advisor. Blakeman
was director of scheduling for President Bushs transition
team in 2000 and later served on the presidents senior
staff from 2001-03.
Thompson, VP of corporate communications for Interstate
Hotels & Resorts, to OCharleys Inc., Nasville,
Tenn., as VP/corporate comms. Prior to Interstate, she held
comms. posts at the American Hotel & Lodging Association.
Kirchoffner, has departed Exelon after five-plus
years as VP of corporate communications to become assistant
VP of communication for North Central College, Naperville,
Abood, VP of corporate communications and IR at Penton
Media, to Ferro Corp., Cleveland, as director of corporate
comms. She previously led communications for Advanstar Communications.
VP of investor and government relations for $2B tech company
Agere Systems, joins Ferro as director of IR.
Barrett, a veteran ad exec, to GPS Industries, Vancouver,
B.C., as marketing and comms. director.
Pulchin, who began his PR career at Edelman in the
late 1980s and rejoined in 2000, has been named GM of the
firms New York consumer marketing practice. In between
Edelman stints, he was director of communications for Guinness
Bass Import Co. and spent seven years at Cohn & Wolfe
as VP/group manager. Christina
Smedley, who has been deeply involved
in the firm's work for Starbucks, Unilever and Georgia Pacific
as eastern region creative director, has been named executive
VP, strategic planning and program development director
for that region.
Seeholzer to VP of IR for FirstEnergy, Akron, Ohio,
succeeding Terrance Howson, who is retiring after 30 years.
Schmidt to president and chief operating officer,
The Frause Group, Seattle, Wash. Schmidt was the first employee
to join Bob Frause
at the firms inception in 1998. Frause takes on the
role of chairman/CEO as part of a plan to divide responsibilities
and lead the firm as a team.
Edition, May 17, 2006, Page 7
PROFS RAP PRSA REPORT (continued
from page 1)
is author of nine books including Hidden Financial Risk.
He has been quoted by the New York Times, Washington Post,
BusinessWeek and USA Today, among others. His column, The
Accounting Cycle: Wash, Rinse and Spin, is on smartpros.com.
is co-author of Financial Warnings, and numerous papers
in financial/accounting journals.
Both Ketz and Mulford supported the contention of the WSJs
2002 article that Omnicom should have taken a loss on its
the WSJ Feb. 9: The creation of the entity, Seneca
Investments, appears to have been used by OMC to avoid an
earnings charge of at least $89.5M in the first half of
2001, when it reported earnings of $246M, documents (from
Claims Record Assets
A PRSA release April 25
led with the claim that its assets had grown 8% in 2005
to the highest level in the Societys 59-year
The third paragraph noted
that 2005 revenues fell 6.7% to $10.2M because of the cancelled
annual conference in Miami Beach.
PRSA in 2005 deferred
$963,082 in income when dues totaled $4.4M. Of the $963,082,
$312,000 was for publications only. Another $651,082 was
for dues paid in advance of a members anniversary
dates or for payments for future seminars.
The Intl Assn. of
Business Communicators, which has date of joining (anniversary)
billing like PRSA, deferred $1.5M of its $2.5M in dues in
2003. It reported net assets of -$715,854. Dues are recognized
on a straight-line basis over the period of membership,
says the IABC audit.
The New York State Society
of CPAs, doing the same, deferred $4.6M of its $6.5M in
dues in 2004.
Mulford said PRSAs
dues should be booked as earned over the course of a year
and that this is not a grey area at all. The
PRSA financial statements do not reflect how the dues
are earned, he said.
Wolitzer said proper accounting
would not cost PRSA any money but would give members
a better picture of the Societys finances...it would
utilize GAAP (generally accepted accounting principles)
better for more transparency.
The CPAs pointed out that
an audit may not address issues of keen interest to members.
PRSA has been reporting
minimal amounts of staff time for its annual conference:
$181,657 in 2005; $103,122, 2004; $108,197, 2003; $108,826,
Former officers and treasurers
say actual staff time on the conference approaches $2M because
of elaborate preparations needed such as lining up nearly
150 speakers each year; arranging for 40+ exhibits; creating
and printing a four-color program of 80 pages or more; advance
visits to cities, etc.
Members were told that
the 2004 conference in New York had record profits of $580,284.
Only about 4% of members
go to an annual conference 2005 president Judith Phair has
The 2005 board permanently
cancelled printing of PRSAs nearly 1,000-page directory
of members, PR services, committees, bylaws, etc., saying
the prime motive was that the new online directory is better
and that cost was not the major factor.
Removed from Categories
The CPA professors were
not pleased by PRSAs new administration
category in which $2.6 million in 2005 expenses are lumped
together after being removed from 13 categories of spending.
A total of $2.2 million was removed in 2004.
For instance, publications
cost $1,428,564 in the 2003 audit but this was restated
to be $970,726 in the 2004 audit. Removed were $457,838
in costs. Similar reductions took place in the other categories
such as the conference, Counselors Academy, PRSSA,
awards program, etc.
However, the CPAs said
there was nothing illegal about such a practice although
the members are getting less information.
There are a lot of gaps
in GAAP, said Wolitzer, who said PRSA should provide a footnote
to the staff costs for the conference telling the members
that only staff time at the actual conference is being counted.
Time sheets should be kept during the year tracking number
of hours worked on the conference, he said. Current practice
is not ideal, he added.
Removed from 13 Categories
Below are 2003 audited
figures of PRSA for 13 categories of spending as reduced
in the 2004 audit.
PR Students Soc.
PARTNERS BEATS INCUMBENT FOR
Partners Creative, a Missoula,
Mont.-based marketing communications shop, beat four competitors
for a $500K, two-year PR push to tackle the misunderstood
and sometimes controversial topic of workmens
Three other Montana firms
Wendt Advertising & PR (the incumbent), G&G,
and Flying Horse Communications and The Carmen Group,
a Washington, D.C.-based firm with a Helena, Mont., representative,
pitched for the account.
The Montana State Fund,
a non-profit agency set up to provide wokers' comp coverage
to the Treasure States 28,000 businesses, was looking
for a firm to tackle the issue and make it palatable for
public education efforts.
Edition, May 17,
2006, Page 8
accounting professors have analyzed PRSAs financial
reporting and come to many of the same conclusions
that we have (page one).
is not full, fair and adequate disclosure, says
Phil Wolitzer of Long Island University, who also gives
accounting classes to reporters for the New York Society
Dues should not be booked
immediately but ratably over the course of the year
as earned, says Professor Charles Mulford of Georgia Tech.
He says this is not a grey area at all and PRSA
has no option but to do it this way.
Mulford and Professor
Edward Ketz of Penn State are the same CPAs who disagree
with the way Omnicom accounted for the shift of 16 dot-coms
to an off-balance sheet entity in 2001.
The Wall Street Journal
thought that Omnicom should have deducted $89M from its
first half earnings of $246M.
OMC is sticking to its
guns, refusing to do so, citing lack of action from the
SEC and approval from two CPA firms, Arthur Andersen and
We dont expect PRSA
to mend its financial reporting ways either, unless it hears
from enough members.
The $1 million in true
assets that it has are a little more than one months
costs, which are about $833,000 on $10M annually. This is
very thin financial ice. By booking advance dues as cash,
PRSA is running a sort of Ponzi scheme that depends on replenishment
from renewing members.
The more candid IABC admits
to deferred dues of $1.5M and admits its assets are -$715,854.
PRSA, in the same manner, should bite the bullet,
face it, deal with it, as the sayings
The worst news we
got from the CPA profs is that audits simply dont
reach down into a lot of spending categories.
Audits are a very poor way for members to learn whats
going on financially with their organizations, especially
when the leaders refuse to make any comments or explanations.
If PRSA members knew that the loss on their annual conference
is well over $1 million a year if staff time sheets were
properly kept, they would no doubt demand changes. They
might want to cut back on the conference, to which only
4% of members go (and at least half of these are forced
to go since theyre in the Assembly, are speakers,
or are on committees, etc.) and opt to get back their annual
printed directory, which all 21,000 members used to receive.
Its spin of the worst sort to claim that the online
directory is better than the printed one. The directory
obviously was ditched because PRSA cant afford the
conference and the directory at the same time. Staff and
leaders love the conference. The members dont. Theres
a lot of free-loading at the conference by leaders including
the 17 directors who get all travel, hotels and meals paid
plus free registration. More than 20 ex-presidents go free
for life and dont pay PRSA dues for life.
Prof. Ketz said PRSA
is a more leveraged organization than
is indicated. The Society signed a 13-year lease for 22,000
sq. ft. at 33 Maiden lane starting in Q2 of 2004 and owes
rent of $5,859,234, having deferred payment of $422,701.
Ketz feels this should be carried as rent payable
rather than deferred rent to be clearer.
PRSA, he said, should show the $5.8M remaining value of
the lease on the asset side of the balance sheet and on
the liability side as a lease obligation. It doesnt
change the equity balance but it does reveal a more
leveraged organization than is presented in managements
statements, he said. Rent in 2004 at 33 Irving place
was $241,000. It is $439,360 for 2006 to 2008 and jumps
to $530,893 in 2009 and $549,200 for 2010 and thereafter.
Howard Blankman, former
president of the Long Island chapter of PRSA and now retired
in Florida, said it was the rank-and-file members
of the chapter who revolted in 1989 and voted to leave PRSA,
not the leaders. He said the members concluded they got
little for $175 in national dues. I believe the new
group, which is focused on the concerns of the rank and
fileas opposed to PRSAs bureaucracyis
serving the needs of members much better than before,
he said...while PRSA
had a 14- year gap between conferences in New York
(1990 to 2004), many conferences and shows are in New York
every year and some two and three times a year. The Javits
Center gave us a list of 26 shows that use the Center yearly
including FAME (fashion), meeting three times yearly; National
Variety Merchandise Show, twice yearly; Intl Gift
Fair, twice yearly; Childrens Club (apparel), four
times yearly; Intl Beauty Show; Intl Restaurant
and Food Service Show; American Intl Toy Fair, and
Intl Hotel/Motel and Restaurant show...by
not having its international conference in New
York, PRSA is leaving nearly $1M in revenues on the
table each year which it can ill afford to do.
Some New York PR pros
are disappointed that only five PR pros made the list
of The Influentials in the May 15 New York mag:
Howard Rubenstein; his son, Steven; Dan Klores and his senior
EVP Sean Cassidy (who is said to be running the Klores firm
day-to-day while Klores is making films), and
Ken Sunshine, who has his own firm and whose main accomplishment
is keeping clients like Leo DiCaprio and Justin Timberlake
out of trashy media. The Rubensteins are practically
family of the magazine because Rubenstein Assocs. represents
former sister company, the New York Post. However, heads
of the big New York PR firms and New York corporate PR depts.
are almost invisible these days because they make few or
no public appearances, give no speeches, write no papers.
They keep a low profile unlike past figures like Kerryn
King, Ed Block, Herb Rowland, Ed Stanton, Jonathan Rinehart,
John Hill, Dave Drobis, Paul Alvarez, Bill Novelli, Jack
Porter, Bob Dorf, Kal Druck, Burt Hochman, etc.