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November 23, 2022

Accounting News Roundup: The Can Is Kicked; The Tax Reform Holding Pattern; Who’s Anti-Reply All? | 03.22.13

House averts government shutdown, backs Ryan budget [Reuters]
The U.S. House of Representatives eliminated the threat of a government shutdown next week, approving on Thursday a stop-gap funding bill that temporarily eases partisan tensions after months of bitter fights over budgets. In a rare show of cooperation, the Republican-controlled House voted 318-109 to approve legislation that keeps government agencies and programs funded through the end of the fiscal year on September 30. The debate over how to shrink U.S. deficits now shifts to rival budget plans from Republicans and Democrats for the 2014 fiscal year starting on October 1.

BASF Lowers Mid-Term Profit Goals on New Accounting Standards [Bloomberg]
BASF is adopting the new accounting rules, called IFRS 10 and 11, a year earlier than required. The Libyan exploration arm Wintershall AG, which was fully included in the books, and BASF’s joint venture with Sinopec in China, which was partially included, will now only be reported under the so-called equity method. That means that the sales from those units won’t be reported, while their share of net income is included in Ebit. “The new targets are purely a result of the accounting changes,” Manfredo Ruebens, head of BASF’s finance department said today at a press conference. The new rules stipulate that you can consolidate a unit if you actually control it. “It doesn’t just go by voting rights anymore,” he said.

New Study Using IRS Tax Data Shows Rich Are Staying Richer, Poor Poorer [Forbes]
A groundbreaking new study concludes that the rich became permanently richer and the poor permanently poorer from 1987 to 2009.  Five economists, including one from the U.S. Treasury and two from the Federal Reserve, used data from nearly 34,000 working age households’ 1040s, W-2s and Social Security records to tease out how much of the much discussed rise in income inequality in the U.S. might simply reflect more volatility in earnings, with families having good and bad years.  Their unhappy conclusion: almost all of the rise in inequality is life-long.
 
Tax reform on hold in Senate amid fight over deficit reduction [The Hill]
Prospects for tax reform in Congress are in limbo because of a fight over whether the effort should raise revenue to reduce the deficit.  The dispute has held action by the Senate Finance Committee, which has not begun preliminary work on overhauling the tax code. Senate Majority Leader Harry Reid (D-Nev.) is undecided whether it should proceed if Republicans do not agree up front on how much revenue should go to deficit reduction.
 
Please Don’t Reply to All [AWEB]
It can get some people upset, don't forget.
 
Lululemon Sheer Yoga Pants Undetected Until Bend-Over Test [Bloomberg]
Analysts asked Chief Executive Officer Christine Day how employees were handling returns, whether the company was changing suppliers and how the pants made it out of the factory in the first place. “The truth of the matter is the only way you can actually test for the issue is to put the pants on and bend over,” Day said on today’s conference call. “Just putting the pants on themselves doesn’t solve the problem. It passed all of the basic metric tests and the hand-feel is relatively the same, so it was very difficult for the factories to isolate the issue, and it wasn’t until we got in the store and started putting it on people that we could actually see the issue.”

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