October 5, 2022

Accounting News Roundup: KPMG Takes More Kicks Over FIFA; Demanding Jobs Hurt People; Taxing Carried Interest | 06.08.15

Corruption in FIFA? Its Auditors Saw None [NYT]
Forensic expert Barry Jay Epstein is quoted as saying that if the DOJ allegations, "turn out to be founded, then analytically, something should have shown up," and KPMG's procedures "would have required deeper investigation."

Escalating Demands at Work Hurt Employees and Companies [DealBook]
Send this to your colleague of choice: "If you are paying employees a six- or seven-figure income, but in return, you are asking them to put in 60, 70, 80 or even 90 hours a week, what is the toll on their quality of life, and ultimately on the quality of their work? It isn’t realistic to build sustainable high-performing companies by way of unsustainable work practices. Meeting people’s core needs, rather than simply trying to squeeze more out of them, is what makes it possible for them to work more effectively. When people work an excessive number of hours, they devolve – meaning they degenerate inexorably from a higher state of capability and consciousness to a more primitive, reactive one. Fatigue, as Vince Lombardi so accurately observed, makes cowards of us all."

Profits at Lixil Dented by China Accounting Scandal [WSJ]
This sounds like the beginning of a story we've heard before: "The Japanese company, which owns the American Standard brand and the Grohe Group of Germany, projected on Monday that it would record a ¥3 billion ($23.9 million) net profit in the current fiscal year ending next March, down 86.4% from a year earlier. The losses stem from the insolvency of Joyou AG, a German-listed Grohe subsidiary that provides toilets, sinks and other plumbing supplies in China. Joyou has dismissed its chairman, Cai Jianshe, and his son, Cai Jilin, the deputy chairman, after a probe uncovered off-the-book loans that Lixil is still investigating."

If Hastert Was Extorted, He Could Deduct Some Losses From His Taxes [Upshot/NYT]
Although proceeds from illegal activity are always taxable, If you've been extorted, sometimes you can screwed in the metaphorical sense: " 'Sometimes judges will find a way to disallow deductions for what they find unsavory behavior,' said Joe Kristan, a tax accountant with the Roth C.P.A. firm. He notTaed a case in which a divided Ninth Circuit panel denied a tax deduction for extortion to a man who said he paid hush money to his mistress."

Leaner Return Anticipated for H&R Block [WSJ]
Interesting bit: "H&R Block typically is profitable for only one quarter of the year because most of its revenue revolves around the April 15 tax-filing deadline."

How a Carried Interest Tax Could Raise $180 Billion [DealBook]
The Treasury Department estimates that taxing carried interest at ordinary rates would raise $18 billion over 10 years. Tax prof Vic Fleischer says that's a bit low.

Escaped Prisoners Left Behind a Politely Racist Note for Police [Gawker]
Also worth noting: the two men are convicted murderers.

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