Accounting News Roundup: Lying About Fraud and Itemized Deductions | 03.15.16

Lying about fraud
Just once I'd like to read a story of an accountant embezzling money for something virtuous. Like, I don't know, someone who's paying for cancer treatments or starting a homeless shelter or a fraud prevention school.

We almost got one with this story of "Gambling addict Muhammad Mahfouz" an accountant who stole money, got caught and then said it was for his family trying to escape Syria. 

Bashir Ahmed, prosecuting, said Mahfouz – who came to the UK as a refugee in 2010 – made two cash transfers amounting to £36,253 before the company’s financial auditors discovered the audacious fraud.

Mahfouz was arrested and immediately owned up to the offences, but claimed that he had stolen to send ransom money to Damascus, the war-torn Syrian capital where he claimed his father and brother were being held hostage.

“He said he was under pressure from his mother to secure a ransom for their release,” said Mr Ahmed.

In fact, Mahfouz was in the grip of a gambling addiction and blew the money on his ever-growing habit.

Plus, his family is in Egypt. Also worth noting is that Mahfouz wasn't even fired for stealing the money but rather "for his poor time-keeping and work record." I'm still holding out for the embezzler/do-gooder.

Itemizing deductions
It's March 15th so you can expect a flood of tax advice articles over the next 31….er…34 days. It serves as a reminder that lots of people know little about taxes and quite a few know less than that. Even accountants who prefer root canals to preparing their own return can't help but chuckle at the lack of basic tax knowledge of your average American. But it's also indicative of a tax system loaded with giveaways that most people don't get to take advantage of. Like, for example, itemized deductions:

[T]he vast majority of Americans rely on this standard deduction instead of filing itemized returns. According to the IRS, fewer than one-third itemize their taxes.

Still, just because fewer people itemize doesn’t mean you shouldn’t look into it,  said Lisa Greene-Lewis, a CPA and tax expert with tax-preparation software provider TurboTax. That’s because many Americans who claim only a standard deduction could be leaving money on the table simply because they don’t know what they can claim to win a bigger refund.

“When people are rushing around doing their taxes at the last minute, it’s easy to leave out tax deductions or credits,” she said.

Look, if you're single, rent your home, only have one job and didn't spend a month in a body cast last year, you're probably not going to itemize. I think that's a pretty practical way to look at it but, by all means, look into it because this isn't tax advice, you should consult a professional like yourself or a colleague, etc. I'd hate for you to miss out on deducting those weekly Goodwill drop-offs.

Firm names
Via Auditor Carousel: Moquist Thorvilson Kaufmann Kennedy & Pieper. Five names, thirteen syllables. This actually makes me re-think my blanket opposition to firms going by initials. Although MTKK&P is a bit much.

In other news:

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