Cain ‘9-9-9’ Tax Plan Captures Debate Spotlight as Perry Recedes [Bloomberg]
“9-9-9 will pass,” the former Godfather’s Pizza chief executive said, “because it has been well-studied and well- developed. It starts with — unlike your proposals — throwing out the current tax code. Continuing to pivot off the current tax code is not going to boost this economy.” Other Republican candidates criticized or ridiculed the idea. “I thought it was the price of a pizza when I first heard it,” former Utah Governor Jon Huntsman Jr. said.
Cain: ‘The problem with that analysis is that it is incorrect’ [WaPo]
Cain couldn’t seem to answer any debate questions without at least mentioning his tax code overhaul plan, which would include a flat nine percent tax on businesses, a nine percent tax on individuals and a nine percent national sales tax. Bloomberg’s Julianna Goldman, one of the debate’s co-moderators, said Bloomberg’s analysis found the plan would not be revenue neutral. Instead, the media company found that it would actually raise less money than the current tax code. Cain responded with what is sure to become a useful catchphrase throughout the rest of the primary season. Cain said: “The problem with that analysis is that it is incorrect.”
NY judge: Home confinement in Arthur Andersen case [AP]
A former managing partner at the Arthur Andersen accounting firm was ordered Tuesday to serve three months of home confinement after admitting he engaged in insider trading. U.S. District Judge Robert Patterson praised the good deeds H. Clayton Peterson has done as he decided not to impose the yearlong prison sentence Peterson, 65, had agreed to during his guilty plea. Peterson, of Denver, was awarded the Bronze Star for his service in Vietnam. Defense attorney Steven Glaser had argued for leniency, citing Peterson’s work on behalf of adopted children and efforts to help find employment for 600 Arthur Andersen employees who lost jobs when the Chicago-based company closed.
Why Do Accounting Academics Blog Less Than Other Academics? [Accounting Onion]
Tom Selling would like to know. He has a theory but would entertain others.
Financial Statement Fraud: How It Is Done [Fraud Files]
Tracy Coenen: “One of the most innocent-sounding terms used to describe financial statement fraud is “earnings management.” Such a phrase minimizes the seriousness of the crime. “Management” almost makes it sound like something good! But earnings management isn’t a noble effort. It is, in fact, financial statement fraud. The degree and seriousness can vary, but it is fraud nonetheless. It is the purposeful manipulation of account balances in order to make the financial statements conform to some predetermined template.”
For Funds, a Groupon Deal Could Disappoint [WSJ]
When four well-known U.S. mutual funds invested $450 million in Groupon Inc. last December, it looked as though they might reap a windfall when the online discount-deal service went public. Now, however, expectations that the funds might triple their money or more have come back to earth. And current estimates of the company’s value suggest some funds may find themselves marking down the value of their holdings in the Chicago online coupon company.
IRS Employees Charged $80 Million on Credit Cards [AT]
The IRS provides credit cards to some of its employees to make purchases of under $3,000. The purchases are supposed to be used for low-cost items such as office supplies and training. The Federal Acquisition Regulation prohibits splitting high-cost procurements into multiple credit card purchases and requires, whenever possible, the use of existing contracts. Cardholders are also required to seek approval for purchases and verify that funding is available prior to using the credit cards. However, the TIGTA inspectors found 2,955 purchases that were potentially split into two or more transactions to circumvent micro-purchase limits; and purchases made from improper sources.