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November 29, 2022

Accounting News Roundup: IRS Word Game; Canadians After E&Y; The Muni Bond Lobby Gets to Work | 06.25.13

Documents Show Liberals in I.R.S. Dragnet [NYT]
The instructions that Internal Revenue Service officials used to look for applicants seeking tax-exempt status with “Tea Party” and “Patriots” in their titles also included groups whose names included the words “Progressive” and “Occupy,” according to I.R.S. documents released Monday. The documents appeared to back up contentions by I.R.S. officials and some Democrats that the agency did not intend to single out conservative groups for special scrutiny. Instead, the documents say, officials were trying to use “key word” shortcuts to find overtly political organizations — both liberal and conservative — that were after tax favors by saying they were social welfare organizations.

Dems unhappy IRS screened for progressive groups, upset investigator didn’t tell lawmakers [AP]
“The Inspector General seriously erred in not making clear in both the audit report and his testimony on this matter that ‘Tea Party’ and ‘Progressives’ were included” in the lists IRS workers used to screen applications, Rep. Sander Levin, D-Mich., wrote Monday in a memo his aides distributed. Levin is the top Democrat on the House Ways and Means Committee.

Canadian regulator takes Ernst & Young to task on Zungui Haixi [Reuters]
Accounting firm Ernst & Young (E&Y) conducted improper audits of Chinese clothing and footwear retailer Zungui Haixi before it collapsed in 2011 following claims of fraud, Canada's top securities regulator alleged on Monday. Toronto-listed Zungui was one of several Chinese companies with North American listings to come under pressure in the wake of fraud allegations against now defunct Chinese forestry company Sino-Forest Corp. The Ontario Securities Commission (OSC), Canada's largest securities regulator, ordered a halt in trading of Zungui's stock two years ago after the company said Ernst & Young halted its audit pending an investigation into "inconsistencies" in the company's bank documents. However on Monday, the OSC alleged the accounting firm failed to act on a timely basis, despite seeing a number of red flags in the company's financial statements. It said E&Y failed to conduct a sufficient review, leaving key evidence in the hands of a staff member with limited experience.

Mayors group: Rolling back bond exemption would put dent in economy [The Hill]
Rolling back the current tax exemption for municipal bonds would take billions of dollars out of the economy, according to a study prepared for the U.S. Conference of Mayors. The study, conducted by IHS Global Insight, said that President Obama’s proposal to cap the exemption at 28 percent would reduce U.S. gross domestic product by $24 billion and take some 311,000 jobs out of the economy.

Tax Policy and the Size of Government [TPC]
Donald Marron and Eric Toder: "Measuring the size of government is not simple. Standard measures omit important aspects of government action such as the many deductions, credits, and other tax preferences used to influence resource allocation. We argue that many tax preferences are effectively spending. Traditional measures of government size thus understate both spending and revenues. Reductions in spending-like tax preferences are tax increases in traditional budget accounting but are effectively spending reductions; increasing marginal tax rates raises both taxes and spending in our expanded measure. Some tax increases thus reduce government, while others expand it."

U.S. Civil Charges Against Corzine Are Seen as Near [DealBook]
The Commodity Futures Trading Commission, the federal agency that regulated MF Global, plans to approve the lawsuit as soon as this week, according to law enforcement officials with knowledge of the case. In a rare move against a Wall Street executive, the agency has informed Mr. Corzine’s lawyers that it aims to file the civil case without offering him the opportunity to settle, setting up a legal battle that could drag on for years.

How to get important people to respond to your emails [Quartz]
Not writing in ALL CAPS is a start.

 
John Wayne Bobbitt Says Penis Severing Improved Love Life [HP]
"Being the most famous man to have his penis chopped off does have its advantages. It definitely has not hurt my love life — in fact, it improved it."

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