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Accounting News Roundup: EY’s Atlantic City Gig Makes Trouble for Christie; KPMG on Edible Passports; IRS Wants Its Billions Back | 04.22.15

Posted on by Caleb Newquist
Chris Christie Officials Give Atlantic City Contract To Firm Of Governor’s Brother [IBT, Earlier]
An executive order awarded EY a $250k consulting gig to come up with a plan "to place the finances of Atlantic City in stable condition on a long-term basis," and people started asking questions. The firm responded by saying that, "Todd Christie has no involvement in any work with the government of New Jersey." 
 
Loans aren’t taxable, until you don’t have to pay them [Tax Update]
Forgiven loans aren't free.

Just a brief follow-up on Jesse Eisinger's whistleblower story we linked to yesterday.

KPMG reacts to edible passports call by Paypal [PlanetBiometrics]
With skepiticism!

A Conversation With R. Byron Carlock Jr., Partner at PricewaterhouseCoopers [NYT]
If real estate is your thing.

Oil Price Rout Has CEOs Courting Accountants Not Wildcatters [Bloomberg]
If oil & gas is your thing.

IRS Seeks Record $2 Billion In Back Taxes From Prominent Businessman And Philanthropist Sam Wyly [Forbes]
If offshore trusts are your thing.

Nine Indicted in Bourbon Heists Involving Wild Turkey, Pappy Van Winkle [WSJ]
Black market bourbon! "A grand jury in Frankfort, Ky. indicted nine people for alleged involvement in a bourbon-theft ring that stole more than $100,000 of whiskey, including hard-to-find Pappy Van Winkle and several barrels of Wild Turkey, the Franklin County Commonwealth’s Attorney office said. The county sheriff’s office said it uncovered the ring after receiving a tip about barrels in the backyard of a man named Toby Curtsinger that allegedly were stolen from Wild Turkey, a unit of Davide Campari-Milano SpA. The detectives linked the bourbon to an employee at Wild Turkey who worked on the loading dock and hauled bourbon between the distillery’s warehouses, the sheriff’s office said. The sheriff’s office said it also recovered more than 20 cases of Pappy Van Winkle—one of the most expensive bourbon brands at $50 to $250 a bottle—as part of the investigation." 

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Accounting News Roundup: Times Square Gets Back to the Grind After Bomb Scare; Down with the Corporate Income Tax; The Politics of Spending | 05.07.10

Times Square Goes Back to Work After Bomb Scare [FINS]
FINS checked in with several companies who have locations in the Times Square area to see if things are back to normal after last weekend’s failed bombing. Most companies are officially mum on the issue including our favorite TS resident, Ernst & Young, who was quoted as to have, “reached out [to their employees] on an informal basis.”

And by “informal” apparently that means “nothing” in some cases We checked with a couple of our own sources at E&Y and we were told that they had not received any communication at all. If there’s an email floating around out there, let us know but it sounds like any reassurance of safety was passed around on a post-it note.


A.I.G. Said to Dismiss Goldman [NYT]
Back in the game AIG! Thanks for the good times GS, Citigroup and Bank of America will take it from here. All it took was a little money for AIG to realize that they were in an abusive relationship.

Time to Junk the Corporate Tax [WSJ]
Michael Boskin argues for dumping the corporate income tax in an op-ed in yesterday’s Journal, citing several reasons that it sucks big time including double taxation, “Corporate income is taxed a second time at the personal level as dividends or those capital gains attributable to reinvestment of the retained earnings of the corporation. Between the new taxes in the health reform law and the expiration of the Bush tax cuts, these rates are soon set to explode.”

…And that stakeholders ultimately bear this cost, “the corporation is a legal entity; only people pay taxes. In a static economy with no international trade, the tax is likely borne by shareholders. The U.S. economy is neither static nor closed to trade, and taxes tend to be borne by the least mobile factor of production. Capital is much more mobile globally than labor, and the part of the corporate tax that is well above that of our lowest tax competitors will eventually be borne by workers.”

The Political Economy of Consumption: ‘Tis Better To Give, and Give, and Give [Tax Vox]
This sums up why America’s deficit problems and citizens personal debt problems will never be fixed:

Not to stereotype, but nations do have personalities. Italians eat. Russians drink. Americans spend. And when anything—or anyone—gets between us and our consumption, watch out.

Recessions make us grumpy in part because we can’t consume as much as we like. In the depths of the current downturn, the savings rate in the U.S. topped 5 percent. But retail sales have been rising since October, and the savings rate has fallen in half. I suspect Americans won’t really feel better until we drive our savings rate back to zero.

Accordingly, politicians have to pander to masses about “cutting taxes” and “reducing spending” when it’s very simple and popular to the do the former, while in reality it’s very difficult and unpopular to do the latter.

Accounting News Roundup: New IASB Short-change Investors; Can California’s Budget Process Be Fixed?; The SEC Dream Team Profile | 02.09.10

• Investors Dissed as Two Appointed to IASB [The Summa]
Investors appear to have been short-changed by the latest appointments to the IASB. Dr. Elke König and Darrel Scott both have corporate accounting backgrounds and represent decidedly different ideas about what accounting rules should be, according to Prof. Albrecht, “Corporations prefer flexible accounting rules so that similar transactions can be accounted for differently by companies or even by a single company. Investors prefer more rigid accounting rules so that transactions are accounted for in a uniform manner.”

Further, the purpose of financial reporting is quite different between the IASB and the FASB, “In the United States, the purpose of financial accounting is widely viewed as providing information to investors so they can make the best investment decisions. In contrast, the purpose of financial accounting under the IASB is to help companies raise capital.”


• Fixing Seasons of California Discontent [WSJ]
California is approaching the last few months of its fiscal year and that means one thing: another huge budget shortfall! The Journal reports on the State Legislature trying to fix it’s impotent ways:

Two groups are pushing ballot initiatives they say would purge that chaos from Sacramento’s budget process. A bipartisan group, California Forward, is pushing a reform to let legislators pass budgets by a simple majority instead of the current two-thirds threshold. Repair California, which is affiliated with a pro-business group, is gathering support to hold a constitutional convention to rewrite state laws. Such a convention could alter the budget process and other facets of governance in California.

California Forward would like to put a measure on the November ballot that allow the legislature to pass budgets with a simple majority but require a two-thirds majority to raise taxes. That sounds like something, plus these IOUs are just plain embarrassing:

“We just have to stop the madness of these IOUs being issued and these horrible budget delays,” said Bob Hertzberg, a former Democratic speaker of the California Assembly who is co-chair of California Forward. “It sends a message…that California is dysfunctional.”

Yeah, we’ve gotten that message; specifically about the legislature.

• S.E.C. Enforcers Focus on Avoiding Madoff Repeat [NYT]
The Times profiles members of the new SEC Dream Team where Bernie Madoff is not to be spoken, “Many here refer to the scandal…as ‘the event’ or ‘the incident.'”

It was an incident all right.

Of course, the mind-numbing bureaucracy didn’t help, “Under Ms. Schapiro’s predecessor, Christopher Cox, investigators had to get approval from the five S.E.C. commissioners to negotiate financial penalties against corporations. She lifted that restriction. Enforcement lawyers had always had to get permission from the commission to open an investigation involving subpoenas. She has authorized the enforcement division to do that on its own.”

Now that Team Khuzhami can get down to business without all the rubber stamping, we’re expecting great things. It’s not like they can get worse.

an orange cat with an alarm clock

Monday Morning Accounting News Brief: Dissecting the Talent Shortage; Big 4 Culture Kills; Are You Happy? | 9.12.22

A deal announced early this month by House Democrats for years of Donald Trump’s financial […]