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Accounting News Roundup: Dems Making Another Run at Payroll Tax Cut; Audit Reform Turkey; Taking Our Tax Medicine | 12.06.11

~ Colin, here: I’ve got some professional obligations to attend to today that will, unfortunately, keep me tied up so posting will be on the light side. Despite my absence, keep us apprised of any holiday spirit shenanigans going on out there and I’ll do my best to turn them around pronto.

Democrats Say They Will Try Again on Payroll Tax [NYT]
Senate Democrats said Monday that they would try for the fifth time in two months to raise taxes on top earners to pay for legislation that would reduce Social Security payroll taxes, as President Obama sought to keep Congressional Republicans on the defensive, asserting that their intransigence could cause a tax increase for tens of millions of American workers.

Olympus Faces Tokyo Delisting After Management Hid $1.7 Billion of Losses [Bloomberg]
Olympus Corp. risks being delisted even if it makes a Dec. 14 deadline to announce earnings, the Tokyo Stock Exchange said after the release of an independent report into false accounting by the Japanese camera maker. Senior management was “rotten to the core” and corrupted other layers of executives that touched it, according to the report of a panel probing Olympus’s schemes to cover up 135 billion yen ($1.7 billion) in losses and payments to advisers dating back decades. Failings by auditors and aid from banks in Europe and Singapore helped hide the losses, it said.

Corzine Rebuffed Internal Warnings on Risks [WSJ]
MF Global Holdings Ltd.’s executive in charge of controlling risks raised serious concerns several times last year to directors at the securities firm about the growing bet on European bonds by his boss, Jon S. Corzine, people familiar with the matter said. The board allowed the company’s exposure to troubled European sovereign debt to swell from about $1.5 billion in late 2010 to $6.3 billion shortly before MF Global tumbled into bankruptcy Oct. 31, these people said. The executive who challenged Mr. Corzine resigned in March.

Esprit Drops as CFO Departs Amid Revival Drive [Bloomberg]
Esprit Holdings Ltd. (330), the clothing retailer struggling to recover from a 98 percent profit slump, fell the most in more than two months in Hong Kong trading after Chief Financial Officer Chew Fook Aun quit. The biggest clothing retailer listed in Hong Kong fell 11 percent to HK$10.72 and the close of trading in the city, its biggest drop since Sept. 21. The stock is down 71 percent this year compared with an 18 percent drop for the benchmark Hang Seng Index. Chew’s resignation for personal reasons will take effect by June 1 as he is “unable to spend the required time in Europe,” the Hong Kong-based casual clothing chain said in a statement yesterday. Esprit, which on Sept. 15 said its brand had “lost its soul,” faces declining sales on the continent, where it made 79 percent of revenue.

Woman gets 18 months for claiming 20 nonexistent children to IRS [LAT]
A former Los Angeles resident drew an 18-month federal prison sentence Monday for filing fraudulent income tax returns involving 20 nonexistent children, all with the same birthday. Norma Coronel, 40, an illegal immigrant who now lives in Livermore, was ordered by U.S. District Judge Manuel Real to pay $302,186 in restitution to the Internal Revenue Service. In a plea agreement, Coronel admitted that she applied for and obtained Social Security numbers for at least 20 fictitious children in 2002. She claimed all the children had been born at a Los Angeles hospital on Dec. 11, 2002.

Audit Reform in the European Union — Michel Barnier Delivers A Holiday Turkey [Re:Balance]
Jim Peterson: “[Barnier’s] “final” proposal to re-engineer the structure and business model of the large accounting firms […] is much revised from the draft leaked in September, resembling the original no more than does turkey hash its original hormone-injected source – ‘fowl’ though they both are.”

The Cartoon that Killed Arthur Andersen [The Summa]
You’re a bad auditor, Charlie Brown.

I’m in a JIT: the Ernst & Young “I’m on a boat” parody video, explained [ACS]
Details that you may not have previously known.

Study Shows Auditors Slow to Adopt Hi-Tech Fraud Detection Strategies [CPAT]
The machines are scary.

Supermodel Christie Brinkley super sorry [Tax Watchdog]
Robert Snell’s scoop has an uptown girl all out of sorts.

New Auditors’ Reporting Model Proposal Set for Release in Q2 [JofA]
The PCAOB’s proposal for a new auditors’ reporting model should be completed by the second quarter of 2012, PCAOB Chairman James Doty said Monday. Speaking at the AICPA’s National Conference on Current SEC and PCAOB Developments in Washington, Doty gave an update on the PCAOB’s initiative on the form and content of the standard auditors’ report.

Pick Your Poison: VAT or Higher Income Tax Rates [TaxVox]
Yes, you have to.

Posted in ANR