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Accounting News Roundup: GOP’s New Budget; PwC’s Edge in Europe; COSO’s New Shortfalls | 03.20.12

House GOP budget to slash taxes [The Hill]
House Republicans will slash personal income taxes to a 25 percent top rate and a 10 percent lower rate as part of their fiscal 2013 budget proposal to be released Tuesday. The election-year plan from House Budget Committee Chairman Paul Ryan (R-Wis.) would greatly simplify the tax code by collapsing the current system of six tax brackets for individuals into two marginal rates, Republican members and aides said Monday. It would also lower the top corporate tax rate to 25 percent, and scrap the Alternative Minimum Tax.

Bankrupt TaxMasters Lists Less Than $50,000 In Assets, Up To 5,000 Creditors [Forbes]
TaxMasters Inc. reported it owes 1,000 to 5,000 creditors up to $10 million, but has less than $50,000 in assets. The filing, which became available on the web site of the U.S. Bankruptcy Court for the Southern District of Texas this morning, calls into question whether the Houston-based tax resolution firm will be able to continue to operate.

Review of FIN 48 isn’t necessary, FASB decides [JofA]
FASB has concluded that it is not necessary to review or reconsider FIN 48 as a result of a “post-implementation review” conducted by FASB’s parent organization, the Financial Accounting Foundation (FAF). The FAF review found that FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (FIN 48), is resulting in more consistent and useful information for users of financial statements. But in a news release Tuesday, FASB said it will consider the post-implementation report’s technical findings in FASB’s review of whether simplifications or modifications in U.S. GAAP are needed for private companies. FASB also will consider the post-implementation review findings in its analysis of remaining differences between U.S. GAAP and IFRS standards, particularly IAS 12, Income Taxes.

UK FSA's Cole to join PwC in the autumn [Reuters]

Margaret Cole, the UK Financial Services Authority's top enforcement official, will join PwC after she steps down from the watchdog this month, the latest top regulator to be snapped up by a Big Four auditor. Cole will begin working for PwC in the autumn and become a member of its UK executive board with responsibility for the Office of General Counsel from December when incumbent Owen Jonathan retires. "The complexity of current and proposed legislation affecting PwC and our clients requires a General Counsel with extensive experience, expertise and judgement," PwC's chairman and senior partner Ian Powell said in a statement.
PwC leads Big Four in European consultancy market, says survey [Accountancy Age]
PwC is best placed among the Big Four accountancy firms to benefit from possible growth in the European market for consultancy services, a survey said. PwC has the edge over Deloitte in European consultancy markets due to "especially favourable views amongst clients about the quality of its people," the survey of more than 400 consultancy clients by found.
What’s Missing from COSO’s New Internal-Control Guidance [CFO]
Forthcoming guidance from COSO (the Committee on Sponsoring Organizations) may help executives who sign off on internal controls keep with the times. However, CFOs will continue to make missteps even if they religiously follow the guidelines since it lacks real-world examples. As we like to say in Colorado, “there’s no silver bullet.” [Ed. note: no one says that] If you follow everything in COSO’s exposure draft released in December, there is no guarantee that your company’s system of internal controls will be effective. This is especially true of the proposal’s guidelines for companies on how to perform risk assessments of their internal controls. Still, management will likely find the new guidance more up-to-date. CFOs have until the end of March to comment on COSO’s refresh of its 1992 Internal Control – Integrated Framework (IC-IF). 


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