How Apple Sidesteps Billions in Taxes [NYT]
Apple, the world’s most profitable technology company, doesn’t design iPhones [in Reno, Nevada]. It doesn’t run AppleCare customer service from this city. And it doesn’t manufacture MacBooks or iPads anywhere nearby. Yet, with a handful of employees in a small office here in Reno, Apple has done something central to its corporate strategy: it has avoided millions of dollars in taxes in California and 20 other states. Apple’s headquarters are in Cupertino, Calif. By putting an office in Reno, just 200 miles away, to collect and invest the company’s profits, Apple sidesteps state income taxes on some of those gains. California’s corporate tax rate is 8.84 percent. Nevada’s? Zero. Setting up an office in Reno is just one of many legal methods Apple uses to reduce its worldwide tax bill by billions of dollars each year. As it has in Nevada, Apple has created subsidiaries in low-tax places like Ireland, the Netherlands, Luxembourg and the British Virgin Islands — some little more than a letterbox or an anonymous office — that help cut the taxes it pays around the world. Almost every major corporation tries to minimize its taxes, of course. For Apple, the savings are especially alluring because the company’s profits are so high. Wall Street analysts predict Apple could earn up to $45.6 billion in its current fiscal year — which would be a record for any American business.
KPMG faces inquiry over rescue of HBOS [Telegraph]
Accountancy giant KPMG could face a formal investigation by the UK’s accountancy watchdog for its conduct leading up to the rescue of HBOS by Lloyds TSB. HBOS whistleblower and former head of risk, Paul Moore, has referred KPMG to the regulator in a formal complaint. Mr Moore has also written to Treasury select committee chairman Andrew Tyrie, seeking his support. Mr Moore’s complaint comes a week after it emerged that the former head of HBOS’s corporate bank, Peter Cummings, is to fight a seven-figure fine handed out by the Financial Services Authority for his part in the collapse of the bank
Deloitte quits as auditor of Singapore-listed China Sky [Reuters]
Deloitte & Touche LLP has resigned as auditor of textile manufacturer China Sky Chemical Fibre with immediate effect, saying it is unable to do its job due to the lack of independent directors, China Sky said on Monday. Deloitte also said China Sky did not have any independent audit committee members since January, the Chinese firm said in a corporate filing.
Western Governors University embezzler is sentenced [SLT]
Prosecutor Vincent Meister said that of the roughly $526,700 embezzled by [Shelley Ann] Wilkinson, she used some to buy a $350,000 house in Canada. "The embezzlement in itself is selfish," Meister said, refuting the defense’s claims that Wilkinson always gave and helped others. "What she stole wasn’t something she needed for subsistence. She bought [another] house and she got caught." Defense attorney Taylor Hartley said that after a few weeks after buying the home, Wilkinson’s guilt got to her and she tried to sell it. She later turned the deed to the home over to the university and Wilkinson started paying money back, but still owes the school about $288,000.
Professor Dave Albrecht has the scoop.