Bullying tax nerds
If you're a candidate running for the highest office in the land, you'll be expected to take a position on taxes. And after you take a position on taxes, you'll be expected to present a tax plan that lays out your vision of how the tax code should work; what rates should be, what deductions and credits should be available, etc. After you release that plan, you can expect the two big tax think tanks — The Tax Policy Center and The Tax Foundation — will score it; that is, if the plan will increase the federal deficit or not and by how much, whose taxes will go up, down and who stands to benefit the most.
The Tax Policy Center released their position on Donald Trump's latest version of his tax plan yesterday, projecting that it would cost $6.2 trillion over the next 10 years and add $7.2 trillion to the national debt over the same period. To be fair, the TPC did not use dynamic scoring for its analysis; that is a method that takes economic growth into account when calculating the cost, but said it "will soon release dynamic scores of both plans." That's not really here nor there for now. What's absolutely bonkers is the Trump campaign's reaction to the TPC's analysis. Here's Richard Rubin's report in the Wall Street Journal:
The Trump campaign called the analysis “fraudulent.” In a statement, national policy director Stephen Miller said the center didn’t model Mr. Trump’s actual plan, including “safeguards” to prevent hedge funds from abusing a proposed 15% business tax rate.
“In other words, this article isn’t even about the Trump plan—but about the gross malfeasance of the deeply-biased Tax Policy Center,” Mr. Miller said.
Vox has the entire statement that also says the TPC "was privately informed they had modeled the wrong plan — not ours — but refused to correct their extremely embarrassing error and model our plan." The TPC's Len Burman responded by saying "the center’s economists modeled Mr. Trump’s plan as best as they could understand it, and that the campaign didn’t provide promised clarifications."
Now, it's not exactly unusual for a campaign to criticize a think tank for its analysis; Mitt Romney's campaign didn't like what the TPC said about his tax plan back in 2012. But it's quite another thing entirely to say that the TPC wrote a "fraudulent" analysis, claim they "modeled the wrong plan" and basically call them a bunch of political hacks when none of those things are even remotely true. Not even the more conservative Tax Foundation thinks the Trump tax plan can work without knowing more details. It's all very bizarre.
One of the most progressive benefits offered by the Big 4 is their family leave programs. Both Deloitte and EY announced this year that employees would have 16 weeks of fully-paid family leave. PwC currently offers six weeks (in addition to six to eight weeks of short-term disability benefits) and KPMG offers "up to 18 weeks of fully paid parental leave for birth mothers" and other primary caregivers get six weeks of fully paid leave.
Clearly the Deloitte and EY plans are more generous since they a) offer more paid time off but also b) because the amount of time is the same for everyone. According to this report in Bloomberg the latter makes a big difference:
Most organizations don't offer time off for new dads, and those that do give them about half of what new moms get, according to a new survey of more than 300 organizations from the Society of Human Resource Management. New moms receive an average of 41 paid days off, compared with 22 days for dads. When given the benefit, many men take some time off, but usually not more than 10 days. That's just half the time they're offered, on average, according to a survey by Boston College.
"We say that it's important, but we're going to give you half the number of days," said Evren Esen, the director of workforce analytics at SHRM. "It's not really equal, and that gives a message to fathers." The message is: Your time off is less important than time off for mothers.
Companies that don't offer paternity or family leave or offer less leave to men reinforces the traditional split of breadwinning and family caregiving between men and women. That creates an environment that discounts and undercuts women's professional ambitions while putting undue pressure on men to go back to work sooner and assume a more traditional role regardless if that's their desire or not. And what if the new parents are two men? Or if the couple is two women and the primary breadwinner didn't carry the child? Are they also shortchanged during the early child development period?
Luckily, there's a pretty easy fix — family leave should be generous and it should gender-neutral. Deloitte and EY seem to have gotten it right. How long will it take the rest of the accounting profession to figure it out?
Non-GAAP accounting worries
A recent BDO survey found that board directors are split on how they feel about regulator guidance on non-GAAP metrics, however they're less uncertain about who should be helping them deal with it:
When they were asked if regulators should provide additional guidance on the use of non-GAAP measures in financial statements, the directors appeared to be evenly split, with 51 percent for the guidance and 49 percent against it.
However, a 67 percent majority indicated they believe auditor involvement would provide higher investor confidence in the reporting of non-GAAP measures. Overall, 70 percent of the board members surveyed believe there are so many disclosures in financial statements today, it is difficult to decide which information is most important.
In other words, they'd like to pass their non-GAAP worries on to the auditors. Surely opiners won't mind shouldering this burden, too?
Has Donald Trump released his tax returns?
Nope! Warren Buffett's latest goading of DJT doesn't seem to be the right lure. I'm not worried, though. We're only one hot mic away from catching Trump's talking about what he'd do to depreciation if he had the chance.
Previously, on Going Concern…
In other news:
- Facebook Continues Fight Over U.S. Taxes After Ireland Move
- SEC Breaks Record for Number of Enforcement Cases
- Comcast hit with FCC's biggest cable fine ever
- Grim reaper spreading message of no texting and walking
- Wifi kettle fail.
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