October 29, 2020

Accounting News Roundup: The New COSO Is Here; ‘We should have done a better job’; Weird IRS Questions | 05.14.13

COSO Issues Updated Internal Control-Integrated Framework and Related Illustrative Document [COSO]
Authored by PwC under the direction of the COSO Board, the updated Framework is expected to help organizations design and implement internal control in light of many changes in business and operating environments since the issuance of the original Framework, broaden the application of internal control in addressing operations and reporting objectives, and clarify the requirements for determining what constitutes effective internal control.

IRS: 'We should have done a better job' [USAT]
Acting Commissioner Steven Miller: "
The Internal Revenue Service recognizes that we should have done a better job of handling the influx of applications by advocacy organizations. Mistakes were made, but they were in no way due to any political or partisan motivation. We are — and will continue to be — dedicated to reviewing all applications for tax-exempt status in an impartial manner. We sought to centralize work in this area in 2010 because our office of Exempt Organizations observed a sharp increase in the number of section 501(c)(3) and 501(c)(4) applications coming from groups potentially engaged in political campaign intervention. Between 2010 and 2012, the number of applications for 501(c)(4) status more than doubled, from 1,591 to 3,398. Because the law limits and in some cases prohibits political intervention by exempt organizations, the IRS must carefully review applications based on the facts of each case. While centralizing cases for consistency made sense, the way we initially centralized them did not."

Five questions on the IRS mess [Wonkblog/WaPo]
Sorta important: "Did the IRS higher-ups act appropriately? Right now, much of the reporting indicates that IRS higher-ups shut this down pretty much as soon as they heard about it. Their sin, if there was one, was that they didn’t disclose that anything had gone awry when asked whether the IRS was targeting conservative groups. But they may also have thought that this wasn’t targeting conservative groups — it was simply a reasonable, but ultimately unwise, way of filtering politicized applications for appropriate scrutiny. The IG report should tell us more on this score." BUT ALSO: "In which direction does our outrage point? Do we think the tea party groups really are primarily non-political social welfare organizations and they should’ve received 501(c)4 designation more smoothly? Or do we think that they’re clearly political organizations and their applications should’ve been closely scrutinized and maybe even rejected  – but so too should the applications from a host of other politicized groups on the left and the right?"

Just 55 Questions, Ma’am [Slate]
“The first we heard from them was in a letter dated January 25, 2012, asking for the answers—get this—by February 16.”

Weirdest IRS Questions for the Tea Party: Views, Donors, and Etymology [ABC]
"Please explain in detail your organization’s involvement with the Tea Party."

Political storm bursts over IRS [The Hill]
“I don’t care whether you’re a Democrat, independent or Republican. At some point there are going to be Republican administrations. At some point there are going to be Democratic ones,” Obama said in a news conference. “Either way, you don’t want the IRS ever being perceived to be biased and anything less than neutral in terms of how they operate.” The top lawmakers at the House Ways and Means Committee, Chairman Dave Camp (R-Mich.) and ranking Democrat Sandy Levin (Mich.), announced Monday that their panel would hold the first congressional hearing on the IRS’s actions Friday, one week after the news first broke. “The Committee on Ways and Means will get to the bottom of this practice and ensure it never takes place again,” Camp said. 

Four Easy Fixes for Corporate Taxation [BI]
By forcing companies to un-consolidate their reports, we would know where their employees were, where their their sales (both source and destination of products and services) were, where they declared their profits and paid their taxes, etc. Part of the beauty of "publish what you pay" is that it doesn't require the cooperation of the tax havens to obtain the information.

Do Survey Results Mean that External Audits Don’t Protect Against Earnings Manipulation? (What a Surprise!) [Accounting Onion]
Tom Selling's adorable cynicism is showing: "I can’t help thinking that E&Y conducts these types of studies to brand itself a thought leader on issues relating to fraud prevention, bribery and corruption. There is nothing wrong with that; but, it seems that in this case EY is walking a tightrope.  On the one hand, EY is attempting to induce potential clients to consider engaging consultants to help design and implement controls for reducing business risk from bribery, fraud, etc.  On the other hand, EY has  to be careful not fall off the wrong side of that tightrope.  The survey appears to have been conducted,  and the report was written, such that nothing should explicitly suggest that audit quality (i.e., EY’s flagship product) could be part of the problem; or stated another way, that the audit profession should be doing a better job of reducing business risk through the audit itself — without charging more fees to do what they should be doing already."

Unruly woman, belting out Whitney Houston songs, kicked off flight [WBTV]
The woman disrupted the flight in part by belting out Whitney Houston songs. And based on the video posted by a passenger on the flight, the woman won't be getting a golden ticket onto the American Idol competition anytime soon. The American Airlines flight departed Los Angeles International Airport at 3:30 p.m. Thursday. It was headed to John F. Kennedy International Airport in New York. But it made an unscheduled landing at KCI at 6:06 p.m. "The woman was being disruptive and was removed from the plane for interfering with the flight crew," airport spokesman Joe McBride said Friday. "There was a federal air marshal on the aircraft, who subdued the woman and put her in cuffs and removed her from the plane." As she was leaving the plane, she crooned, "I will always love you," which was written by Dolly Parton. Both Parton and Houston performed the song.

 

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