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Accounting News Roundup: Deloitte Banking on Asia; New Partners at WeiserMazars; MI: Corporate Tax Rate | 11.03.11

Euro’s Leaders Question Greek Membership [Bloomberg]
Led by Germany and France, Europe’s economic and political anchors, the euro’s guardians yesterday cut off financial aid for Greece until an early December vote determines whether it deserves a fresh batch of loans needed to stave off default. “The referendum will revolve around nothing less than the question: does Greece want to stay in the euro, yes or no?” German Chancellor Angela Merkel told reporters after crisis talks hours before a Group of 20 summit set to begin today in Cannes, France. French President Nicolas Sarkozy said Prime Minister George Papandreou’s government won’t get a “single cent” of assistance if voters reject the plan.

MF Global accused over fund transfers [FT]
CME Group, the US exchange operator and supervisor of MF Global’s futures brokerage business, has accused the failed broker-dealer of moving customer funds “in a manner that may have been designed to avoid detection”. MF Global left a $633m shortfall in what are supposed to be protected customer funds, the Commodity Futures Trading Commission said on Wednesday. The disclosure came as lawyers for MF Global’s bankruptcy trustee raced to arrange the transfer of thousands of commodities accounts before the law requires their liquidation.

Deloitte Plans More Asia Growth [WSJ]
Barry Salzberg, global chief executive officer of the international network of accounting, consulting and auditing firms, said in an interview with The Wall Street Journal last week in Singapore that Deloitte’s work force grew by 12,000 last year, and that he expects a similar pace of hiring in the fiscal year ending next May. Deloitte has also said it expects by 2015 to increase the total to 250,000 people, from 182,000 today.

Investors Punish Diamond for Delay [WSJ]
Investors reacted harshly Wednesday to questions about accounting at Diamond Foods Inc. that forced the snack maker to delay its $2.35 billion acquisition of Pringles into next year. The company’s stock fell 18% to $52.79 a share, a level that, if sustained, would make the deal $150 million more expensive than it would have been before Diamond announced the delay. Late Tuesday, Diamond said it would investigate allegations sent to the chairman of the board’s audit committee, Edward A. Blechschmidt, regarding Diamond’s accounting for certain crop payments to walnut growers.

WeiserMazars LLP Promotes Three Senior Managers to Partner in New York City and Lake Success, N.Y. Offices [WM]
Seth Cohen, Guillaume Wadoux and Roberto Viceconte have earned seats at the adults table.

IRS Acquiesces in O’Donnabhain: Gender Reassignment Surgery Is a Deductible Medical Expense [TaxProf]
The court held that because hormone therapy and sex reassignment surgery treat the taxpayer’s disease they are medical care, and the expenses for that medical care are deductible under § 213.

Frantic trading before MF Global UK failure – KPMG [Reuters]
KPMG also said it was working closely with company staff to transfer client positions, and that it had already closed out substantial positions. “Since our appointment we have received thousands of e-mails, telephone calls and letters from clients and related parties with highly complex requests,” Richard Fleming, UK head of restructuring, said in the release.

How Should Auditors Handle China’s State Secrets Law? [WSJ]
In the case of KPMG, it’s decided to issue a “qualified opinion of scope limitation” – essentially not being able to sign off on a company’s books – for its client, Hong Kong-listed China High Precision Automation Group Ltd.

Mission Impossible: Cutting the Corporate Tax Rate to 25 Percent [TaxVox]
It has been an article of faith among most congressional Republicans and many Democrats that the corporate tax rate should be cut from today’s top level of 35 percent to 25 percent—or even less. And backers of the idea breezily suggest this could be paid for by scaling back some corporate tax breaks. But a new report released today by the congressional Joint Committee on Taxation concludes it can’t be done.

Posted in ANR