October 4, 2022

Accounting News Roundup: No Low Tax Rates for You, Accounting Firms | 09.13.17

mnuchin tesco trial identity fraud

Critical audit matters

A BDO survey of corporate board directors found that 48% of them “do not feel the discussion of CAMs is an improvement to the transparency and usefulness of the auditor’s report for investors.” This shouldn’t be surprising since 1) A lot of board members don’t care much about auditing and 2) Even quite a few audit committee members don’t care much about auditing.

Interestingly, 50% of those directors surveyed are concerned that “the discussion of CAMs in sensitive areas could make their job as a board member more difficult.”

But isn’t being a board director supposed to be difficult? I like how BDO designed a survey question to feel out the delicate sensibilities of corporate board directors, as if their comfort is the primary concern here. I’d think that if anyone out there were to be groomed for handling a metric asston of extra work, it’d be corporate board members. Pile it on, I say.

How’s tax reform coming along?

Bad news, accounting firm partners:

Some services companies such as accounting firms won’t get the benefit of lower tax rates Republicans are planning for other businesses, Treasury Secretary Steven Mnuchin said Tuesday.

Republicans want to cut the 35% corporate tax rate. They also want to lower rates on so-called pass-through businesses, which pay business taxes through the individual tax returns of their owners at individual tax rates, which currently reach as high as 39.6%.

Some of you might be thinking, “No, he doesn’t mean…”

Yes. Yes, he does:

“If you’re an accountant firm and that’s clearly income, you’ll be taxed an income rate, you won’t be taxed a pass-through rate,” Mr. Mnuchin said. “If you’re a business that’s creating manufacturing jobs, you’re going to get the benefit of that rate because that’s going to be passed through to help create jobs and better wages.”

It’ll be interesting to see if accountants remain gung-ho about tax reform if they’re get excluded from all the fun.

Accountants behaving badly

Some people just can’t help themselves:

An accountant and disbarred San Diego attorney who once claimed to lead one of the nation’s most prestigious estate and tax planning law firms has pleaded guilty to hiding $1.5 million in assets from creditors in his bankruptcy case and evading $6 million in taxes.

J. Douglass Jennings Jr., who sometimes went by “Uncle Doug,” pleaded guilty in San Diego federal court on Monday to bankruptcy fraud and tax evasion, the U.S. Attorney’s Office said.

Uncle Doug tried to hide a $1 million real estate interest, a 53-foot yacht named “Sea Eagle” worth $150k, and antique silver worth $165k. Uncle Doug’s wife, Peggy (Aunt Peggy, I presume) also forged a bunch of loan documents in her mother’s name. They’re both in their 70s, so I imagine them to be fun grandparents.

Previously, on Going Concern…

I mentioned a story about a CPA who got caught in the act of (allegedly) ripping off a client. In Open Items, someone asked about interning at a small firm after accepting an offer from PwC.

More from Going Concern

Don’t forget to check out our new career page, Gigs. Skim it for jobs and sign up to receive the latest info on opportunities in select cities like New York and Los Angeles.

Speaking of L.A., we’re surveying accountants who live and work there. If that’s you, help us out.

Finally, we released our inaugural accounting compensation report last week.

In other news:

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