It seems that some people are still worried about non-GAAP accounting, but they're not as worried as they used to be. This Wall Street Journal story reports that the SEC looked at GE's non-GAAP reporting and decided they should point out a few things:
In correspondence between the SEC and GE from June through September, the agency contended that the company’s non-GAAP disclosures could be unclear or confusing to investors and that its metrics may have excluded some costs they shouldn’t have.
In response, GE has told the SEC that it would revise its non-GAAP disclosures to address the commission’s concerns, though it defended its disclosures as helpful and relevant to investors.
But since they got that off their chest, however, the Commission hasn't "[taken] any further action" so I guess everything's fine. Also, Compliance Week reports that the SEC "is signaling it is encouraged by improvements in recent quarters" although the chief accountant in the Division of Corporation Finance says, "There are some, not a large number, of fairly contentious issues." I get the sense that all the non-GAAP worrying might go away, but then again, the new administration has some experience in this regard, so maybe they can make worrying about non-GAAP accounting great again.
Turnover at the FASB
Anyone hoping that the FASB chairmanship would open up just for them, will have to wait a little longer as Russ Golden was reappointed to another term:
Golden began serving as FASB’s seventh chairman in 2013. His first term ends next June and his second and final term will extend his chairmanship until June 30, 2020. At Financial Executives International’s Current Financial Reporting Issues conference in New York on Monday, Golden discussed the increasing turnover at the board, but without referring to the following day’s upcoming announcement.
Right! Even if you aren't chairman that doesn't mean you can't serve. Golden said just the other day, "We’re entering into a high degree of change associated with more members,” so I'd like formally put forth my application here. I may be light on the credentials, but I'm an exceptional listener and could liven up the presentations with some GIFs.
Accountants behaving badly
If people refer their friends to you as their tax preparer and you post fliers claiming to be a tax preparer, does that make you a tax preparer? Robert Coates gave it a try:
According to court documents, between January 2012 and July 2012, Coates filed false claims for income tax refunds with the IRS. Coates presented himself to be a tax preparer in Xenia, and filed fraudulent income tax returns on behalf of individuals who were referred to Coates by other taxpayers or for those who responded to a flyer Coates distributed in and around the Xenia area, according to a press release from the IRS.
Whether Coates was a tax preparer or not, he knew his way around a tax return well enough:
Unbeknownst to the taxpayers, the IRS said Coates included fraudulent amounts of income in the form of Household Help income (known as “HSH”) in order to maximize the earned income credit and to generate an income tax refund. In addition, Coates included fraudulent amounts of qualified educational expenses in order to generate a refundable education credit. Coates filed these income tax returns knowing that the HSH income amounts and qualified education expenses were fraudulent and the claimed income tax credits and refunds were fraudulent, the IRS said.
I'm not saying that requiring a license to prepare tax returns is the answer, but it's pretty remarkable that you can't teach ballroom dancing without a license in some states and tax preparers still operate in the wild west.
Previously, on Going Concern…
Rachel Andujar offered some advice to someone who was feeling bored and stuck.
In other news:
- House Republicans Aim to Cut Taxes Without Increasing Deficits
- Risky Business: SEC Focuses on Internal Controls
- Snap IPO
- President Trump can give back his salary and deduct it. Not you, though.
- Airline hotline short fiction.
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