Accounting News Roundup: More Auditor Changes Expected in UK; Koss Corp.’s Recovery Efforts; The Uncashed $1 Million Check | 08.12.13

Companies spurn UK over taxation, says Deloitte boss [Telegraph]
David Sproul, senior partner and chief executive of Deloitte UK, said that a number of companies the firm had been advising about a move to the UK have put their plans on hold as a result of the mixed messages on tax. He said that there was a disconnect between the Treasury’s aims of attracting companies to the UK by reducing corporation tax rates and the House of Commons Public Accounts Committee’s (PAC) attempt to “determine what the fair share of tax is” for large companies. His comments come as the Government today launches a consultation, proposing fines of up to £1m for promoters of tax avoidance schemes that fail to give HM Revenue & Customs early notice of how they are designed.

Big firms' audit switches set to double, EY claims [Independent]
Little more than a week after PricewaterhouseCoopers poached the FTSE 100's most lucrative audit off rival KPMG, another big four accountant today predicted the number of Britain's biggest audits being re-tendered will double this year from last. EY, the former Ernst & Young, said 10 FTSE 100 firms are already tendering, or about to tender, their audits when only 5 did so in the whole of 2012. The accountant expects another 20 to do so in 2014.

Britain plans to name, shame 'cowboy' tax advisers [Reuters]
British authorities would get the right to name and shame tax advisers who deliberately steer their clients into tax avoidance schemes that are likely to break the law, under a government proposal announced on Monday. The proposal is part of a wider effort to discourage companies and individuals from using complex schemes – some of which drift over into illegality – to reduce their tax payments, after several multinational firms were shown to be paying little or no taxes in Britain. "The vast majority of tax advisers are not high-risk and have moved away from selling aggressive avoidance schemes but there is still a minority that persists in promoting these schemes," Treasury Minister David Gauke said in a statement.

Californians flee to Nevada to escape taxes, agents say [SJMN]
George Ashley of the Nevada accounting firm Ashley Quinn said his company has "had at least 100 serious inquiries" from Californians interested in moving to the Nevada side since the passage of Proposition 30, including people with "large liquidity events" like the sale of a company or a lot of stock. […] A 2010 Stanford University study found little impact on millionaire migration from a 2005 mental health services tax on incomes over $1 million. But the passage in November of Proposition 30 seems to have been a turning point for some wealthy folks. "It really started at the end of November," said Lexi Cerretti, an agent with of Sierra Sotheby's International. "Right after it passed, some of these really high-net-worth individuals were saying, 'That's the last straw,'" she said.

Koss Corp.'s Sachdeva embezzlement recoveries approach $10M, after fees [MBJ]
Koss Corp. still has a long way to go before it comes close to making up the money embezzled by former employee Sujata “Sue” Sachdeva. But it did make some significant progress this year with an $8.5 million settlement with its former auditor, Grant Thornton LLP. The settlement resulted in $6.38 million for the company after legal expenses. Koss’ 2013 fiscal year, which ended June 30, was a breakout year for the company when it came to recovering the embezzled funds. The company has received proceeds from insurance settlements and several auctions of merchandise, mostly clothes and jewelry, Sachdeva bought with embezzled funds. But it also has doled out quite a bit in legal fees in the case. The company cleared just $826,000 in 2011 and $1.47 million in 2012 in recovered funds after legal expenses, but in 2013 it recovered $7.59 million. That makes for a total of $9.88 million, about 30 percent of the $34 million embezzled.

Six areas where new revenue recognition standard will require judgment [JofA]
Only six?

The $1M Check That Sat in a Drawer: How Detroit Went Bust [Bloomberg]
Leaving a $1 million check in a desk drawer for a month will help.

Swedish men told to beware testicle-munching fish [Telegraph]
Experts have warned Swedish men to keep their swimming trunks on if taking a dip in a sound off the country's southern coast, after a South American fish known for attacking testicles was discovered in the area.

Latest Accounting Jobs--Apply Now:

Have something to add to this story? Give us a shout by email, Twitter, or text/call the tipline at 202-505-8885. As always, all tips are anonymous.

Related articles