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ANR: HSBC Tells KPMG That It Wants to See Other Auditors; Single People Need Work-Life Balance Too; Carried Interest Is NBD | 03.07.13

Posted on by Caleb Newquist

KPMG at risk of losing vital HSBC audit [FT]
KPMG could lose the biggest audit contract in corporate Britain after HSBC decided to consider bringing in a fresh pair of eyes to vet its accounts. The bank said it would put its audit contract out to tender for the first time in more than two decades in the most striking sign yet that regulatory pressure is starting to break down the ties that bind many big companies to their auditor. HSBC paid KPMG $81m in 2012. The majority of this was for audit and audit-related services, the rest being tax and other consultancy work. It has held the audit contract since 1991.

Banks Should Reveal Credit Losses Earlier, Accounting Board Says [BBW]
“We believe the model leads to a more timely recognition of credit losses,” Hans Hoogervorst, chairman of the London- based IASB, said in the statement. “At the same time, it avoids excessive front-loading of losses, which we think would not properly reflect economic reality.”
 
Apples and oranges [Economist]

Irritatingly, the new standards are not consistent. Under FASB’s approach, firms would have to lop an amount off an asset’s carrying value on the day it is booked, to discount for the fact that some loans always go bad over their lifetime. IASB would require a smaller set-aside, discounted by the likelihood that the loans in question will go bad only in the next twelve months. If conditions suggest that the credit quality of the loans has actually deteriorated, only then would IASB require that the entire expected loss be booked. (At this point, the accounting would be like FASB’s.) This represents a failure in the two boards’ biggest ambition: to converge their standards to create a single set for most of the world. The boards have been working on this project for some years. They have achieved quite a lot of progress; global financial statements are becoming more comparable in many ways. But in perhaps the most prominent issue facing them, they now agree to disagree.

Single, childless and want work-life balance? How taboo [WaPo]
Talk about nerve.

The Ten Worst States for Taxes (Nine Are Blue States) [TaxProf]
North Carolina surprises with a very respectable 7th place. 

Texas Is the New California [Forbes]
Does this mean Phil Mickelson is going to hold another press conference?

Ex-Kirkland Partner Freedman Pleads Guilty to Tax Fraud [BloombergLaw]

Former Kirkland & Ellis LP senior partner Theodore Freedman pleaded guilty to fraud in connection with the filing of false tax forms. Freedman changed his plea yesterday from not guilty to guilty of four counts of tax fraud. U.S. District Judge Deborah Batts in Manhattan accepted the plea and set sentencing for Sept. 17. Freedman’s lawyers reached a plea agreement with U.S. attorneys. Indicted in July 2011, Freedman misrepresented his income as a partner at the law firm by about $2 million, the U.S. said. He also claimed more than $500,000 in expenses for a sole proprietorship that didn’t exist, the government said.
 
The Carried Interest Debate: Funding Government for 3.1 Hours [TF]
Hey, that's something!
 
Forget the Old College Try, Ring the Concierge [WSJ]
This is so stupid: "Twenty-year-old twins Leon and Raquel Papu, sophomores at Babson and Tufts University, respectively, have called upon their BCCG concierge to intervene in a landlord dispute, wait for a plumber and line up Boston Celtics tickets. Mr. Papu, who was born in Colombia but grew up in Miami, also contacted the company when he was pulled over for speeding on the way home from a Vermont ski trip last winter. The concierge reached out to a local lawyer, who went to the ticket clinic and paid the fee."
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NFL Commissioner and Union Chief Meet to Discuss Expiring Player Contract [Bloomberg]
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Deloitte’s Troubles Bubble To Surface [RTA]
Francine McKenna gives Deloitte’s troubles a look.

FCIC Gives Accounting Standards a Free Pass (Along with Practically Everybody Else) [Accounting Onion]
The FCIC had a hard time assigning blame to anyone or anything.


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And Michael Bennett is the new OMP in Houston.

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Accounting News Roundup: Obama’s Plan Gets the Editorial Treatment; DC Shutdown 2.0?; Poker Players Get Prickly After Ponzi Accusations | 09.22.11

Taxes, the Deficit and the Economy [NYT]
Republicans want to close the entire budget gap by slashing government spending. The president’s balanced approach protects vital services and growth. It includes $245 billion in payroll tax cuts next year for workers and businesses to encourage hiring, investment and spending. It also includes money to invest in infrastructure and to aid struggling states. It only starts reducing the budget deficit in 2013, when the economy should be stronger. As is his wont, the president is still leaving too many details for Congress to decide.

The Spend Now, Tax Later Jobs Bi=”http://online.wsj.com/article/SB10001424053111904194604576583151431651920.html?grcc=88888&mod=WSJ_hps_sections_opinion” target=”_blank”>WSJ]
According to the Sept. 19 White House fact sheet, “The President calls on [the super committee] to undertake comprehensive tax reform, and lays out five principles for it to follow: 1) lower tax rates; 2) cut wasteful loopholes and tax breaks; 3) reduce the deficit by $1.5 trillion; 4) boost job creation and growth; and 5) comport with the “Buffett Rule” that people making more than $1 million a year should not pay a smaller share of their income in taxes than middle-class families pay.” But the administration’s tax plan violates these principles.

IRS Gives Employers a Break on Payrolls [WSJ]
Businesses that have been improperly labeling their employees as independent contractors got a surprise break Wednesday: A new Internal Revenue Service program will allow those businesses to reclassify workers and make only a small payment to cover past payroll taxes. The downside for such companies? Regulators say they are going to be more vigilant about misclassification of workers in the future.

US government shutdown looms again [FT]
The US government has been put at risk of a possible October 1 shutdown because of a partisan fight on Capitol Hill over disaster relief for victims of hurricane Irene and Democratic opposition to proposed cuts to subsidies for fuel-efficient cars. At the centre of the debacle lies the ongoing struggle between conservative Republicans and Democrats over how much the government ought to be spending and how programmes are paid for. In a move that shows the challenge facing Republican leaders in the House of Representatives, who are seeking to appear more conciliatory following this summer’s tough debate over an increase in the debt ceiling, lawmakers voted 230-195 against a bill to keep the US government funded temporarily.


Poker Site Fires Back at U.S. [WSJ]
The issues at Full Tilt should be likened to that of a problematic bank, rather than an illegal investment scheme, according to Jeff Ifrah, an attorney who represents the company in related litigation and is the personal attorney of Chief Executive Raymond Bitar. “A Ponzi scheme requires an investment vehicle in order to receive a certain rate of high return,” Mr. Ifrah said. “None of those things happened here.” Instead, he said, “maybe it was mismanaged.”

Colbert: The Buffett Rule [TaxProf]