Category: ANR

GM Raises Sights for IPO [WSJ]
General Motors says it is raising the price range for its initial public offering of common stock to $32 to $33 per share. The new price range is about 14% higher than originally expected.

The share and price expansion are the result of strong investor demand for shares in the U.S. auto maker, which now is generating solid profits after shedding costs under a 2009 bankruptcy reorganization.

A Little Extra on the Road [NYT]
Corporate accountants have long known that otherwise law-abidinel expense fraud.

And while new software programs help detect fraud, businesses report that travel fraud increased in the last few years as the distressed economy put more financial pressure on both employees and employers.

“I don’t think people always take the view that falsifying expense claims is a criminal act,” said John Verver, vice president for services and product strategy at ACL Services, a provider of financial monitoring software and expertise.

IRS Throws in Towel on Closely Watched International Tax Case [TaxProf Blog]
Transfer pricing nerds will like this one.

Litigation Disclosure: What They Don’t Know Can Hurt You [Forbes]
Francine’s latest at Forbes discusses the progress on a new litigation standard. Or lack thereof, “Everyone – the lawyers, the auditors and company executives – has been fighting the Financial Accounting Standards Board’s (FASB) proposals for expanded disclosures over loss contingencies for more than two years. For shareholders, this means, everyone who is supposed to be working for you is fighting additional disclosures that would help you – the investor – know if a legal bomb was about to drop on your investment.”

Dudley Says QE2 Critics Don’t `Understand’ Fed’s Exit Plan [Bloomberg]
Federal Reserve Bank of New York President William Dudley said critics of the expansion of monetary stimulus are underestimating the central bank’s ability to raise interest rates when necessary.

“People do not understand clearly” that “we can have an enlarged balance sheet and not have a long-term inflation problem,” Dudley said in an interview with CNBC. “We are very confident of our ability to exit when the time comes.”

Jason Blumer: Don’t Believe the Lies [CPA Trendlines]
Blumer is thinking about the future, “It seems the end of a public accountant’s career is steeped in misery, being “worn out” and adverse to change. Not a very exciting picture for those entering universities deciding what to major in! Is this what the younger generation has to look forward to when they retire?”

Meet the New Small-Business Owners in Congress [You’re the Boss/NYT]
Last Tuesday’s elections will send 33 small-business owners and entrepreneurs to Washington, according to The Agenda’s exhaustive (and exhausting) search. All are Republicans. Two are women.

Jack Link wins national Ernst & Young award [MBJ]
The beef jerky company that does ads like this:

White House: No Permanent Tax Cut on Rich [WSJ]
Senior White House adviser David Axelrod said Sunday the president wouldn’t support a permanent extension of tax cuts for wealthy Americans but declined to say whether the White House would support a temporary extension.

Mr. Axelrod also reaffirmed President Barack Obama’s commitment to securing an extension of tax cuts for the middle class, saying this group of Americans has “taken a terrible beating.”

After several days in which U.S. lawmakers have attempted to gauge the White House’s willingness to compromise on tax-cut extensions, Mr. Axelrod said on NBC’s “Meet The Press” that there would be “no bend” on the president’s opposition to permanent cuts for couples making more than $250,000 a year and individuals making more than $200,000.

Rangel’s Hearing Set to Begin, but Details Are Few [NYT]
After two years of investigations and political recriminations, Mr. Rangel is scheduled to appear before a hearing of the House ethics committee on Monday to formally rebut charges that his fund-raising and personal finances violated Congressional rules.

Congress holds public ethics hearings so rarely — the last was in 2002 for Representative James A. Traficant, an Ohio Democrat who had been convicted of criminal charges — that the proceedings will open amid an air of novelty and uncertainty. Neither committee investigators nor Mr. Rangel will discuss who or how many people are on their witness lists, so it is unclear whether the case will end quickly or drag on for days.

What Are the Odds of an Obama Compromise on Bush Rates? [Tax Update Blog]
It’s not Vegas but this should help you get a feel for what the tax rates will be next year.

Accounting for Grant Thornton’s Accountants [China RealTime Report/WSJ]
The Journal takes another stab at the BDO/Grant Thornton jumble in Hong Kong and appears to have straightened things out.

Baucus will introduce legislation to repeal 1099 requirement [On the Money/The Hill]
Senate Finance Committee Chairman Max Baucus (D-Mont.) said Friday that he intends to introduce legislation to repeal requirements that businesses file 1099 forms for purchases of $600 or more made from suppliers.

“I have heard small businesses loud and clear, and I am responding to their concerns,” Baucus said in a statement.

Veterans Day – November 11 [DVA]
Remember those who served.

Deficit Panel Pushes Cuts [WSJ]
A White House c sweeping proposal to cut the federal budget deficit by hundreds of billions a year by targeting sacrosanct areas of U.S. tax and spending policy, such as Social Security benefits, middle-class tax breaks and defense spending.

The preliminary plan in its current form would end or cap a wide range of breaks relied on by the middle class—including the deduction for home-mortgage interest. It would tax capital gains and dividends at the higher rates now levied on wage income. To compensate, one version of the plan would dramatically lower and simplify individual rates, to 9%, 15% and 24%.

Deficit Panel Co-Chair Plan Is Tough, Creative, and Credible, But What Next? [TaxVox]
The Fiscal Commission gets a thumbs-up from The Tax Policy Center, “The co-chairs of President Obama’s much-maligned bipartisan fiscal commission have proposed a remarkable plan for both reducing the federal deficit and reforming the tax code. It is remarkable because it’s tough, specific, credible, and even creative. On the spending side, it carefully spreads the pain throughout government. And on the tax side, it makes a strong case for reform and presents no less than three ways to get there.”

Incorrigible: Fannie Mae and Freddie Mac Must Go [Forbes]
Francine McKenna’s latest at Forbes takes on the GSEs.

2010 Tax Filing Season Statistics [TaxProf Blog]
70% of 141.5 million tax returns were e-filed; average refund of $3,189.

Scaled back mortgage-interest deduction raises concerns [On the Money/The Hill]
Michael Berman, chairman of the Mortgage Bankers Association voiced concern over the plan to limit mortgage deduction to exclude second residences, home equity loans and mortgages over $500,000.

“Given the fragile state of the nation’s housing market, now is not the time to be scaling back incentives for homeownership,” he said today in a statement. “The mortgage interest deduction is one of the pillars of our national housing policy, and limiting its use will have negative repercussions for consumers and home values up and down the housing chain.”

Spreadsheets: Why Pivot Tables Won’t Sum [CFO]
Your dilemma – solved!

The Daily Docket: Ambac, IRS Strike Deal [Bankruptcy Beat/WSJ]
“Ambac Financial Group Inc. struck a deal with the Internal Revenue Service Tuesday that requires the IRS to notify the bond insurer before taking any actions involving hundreds of millions of dollars in tax refunds.”

A Strategic Plan for Internal Audit [Marks on Governance/IIA]
News you can use.

IRS looking for help [Bristol Press]
Calling all Connecticut residents who are feeling charitable – VITA/TCE volunteers are needed.

A Female Wall St. Financial Chief Avoids Pitfalls That Stymied Others [NYT]
Ruth Porat, the CFO at Morgan Stanley, gets a write-up in the Times which doesn’t hesitate to point out all the women CFOs that have failed before her, “In Ms. Porat’s case, she is often reminded about recent Wall Street history. ‘Be careful in everything you do, because we all know how this ended before,’ another stock analyst told her at a cocktail party earlier this year on the 41st floor of Morgan’s Stanley’s headquarters in Midtown Manhattan, according to attendees.

The comment was a not so subtle reference to the last two female chief financial officers on Wall Streehman Brothers and Sallie L. Krawcheck at Citigroup. Ms. Callan resigned from Lehman just months before it filed for bankruptcy and is now under investigation by regulators. Ms. Krawcheck struggled as chief financial officer at Citigroup and was publicly demoted in early 2007.”

But the boys’ club might be able to relax on this one, as Ruthie sounds committed, “In 1992, during the birth of her first son, she was on the phone in the delivery room making client calls.” Oh, and there was this time that she threw her back out finished a presentation on the boardroom table. Legendary!

Ambac Has Stipulation With IRS Over Tax Dispute [Bloomberg]
Ambac Financial Group Inc., the bankrupt holding company for a failed bond insurer, has a stipulation with the Internal Revenue Service over a dispute about whether the agency can seize at least $700 million in tax refunds, an Ambac lawyer said in bankruptcy court today.

Under the stipulation, the IRS has agreed not to take enforcement action against Ambac or its subsidiaries without giving five days’ notice. The agreement will remain in place until Ambac holds a hearing to decide whether it can get a judgment to decide the issue.

Google to Give Staff 10% Raise [WSJ]
Chief Executive Eric Schmidt disclosed the raise in an email to employees, saying the company wants to lift morale. “We want to make sure that you feel rewarded for your hard work,” Mr. Schmidt wrote. “We want to continue to attract the best people to Google.”

The S.E.C., Whistle-Blowers and Sarbanes-Oxley [DealBook]
The S.E.C., led by Mary L. Schapiro, released its proposal last week. Unfortunately for businesses, the S.E.C. must comply with the Congressional directive that puts the interest of attracting tips about corporate wrongdoing ahead of the internal compliance programs that most corporations set up under the Sarbanes-Oxley Act, which passed eight years ago. For businesses, it looks like Congress may be willing to use the new whistle-blower programs to undermine Sarbanes-Oxley.

Lamar Odom Seeks Tax Deduction For NBA Fines and Fitness Fees [Forbes]
Odom is going pro se before a U.S. Tax Court to get back “$12,000 in sports fines and another $178,000 spent getting himself in shape.” His wife, no stranger to tax-related fiascos, must have told him that it was the smart move.

Does the GOP Really Want to Slash Spending in a Weak Economy? [TaxVox]
No doubt the GOP wants to shrink government. And there isn’t much doubt that some voters agree with them. But is this the time? Will voters be quite so enthusiastic once they realize spending cuts mean more than eliminating ever-popular waste, fraud, and abuse? Will they embrace actual reductions to those government services and benefits that they have grown to love? And, most important, will they accept these government spending cuts in the teeth of a still-sluggish economy?

The Big Four: Too Few to Fail [Accounting Onion]
We need at least a fifth firm, but preferably lots more, that are capable of taking on the largest corporations as clients. Surely, the public has learned more than they wanted to know about the concept of moral hazard from the too-big-to-fail banks. And just as surely, the Big Four are too few for financial regulators to let fail. This version of moral hazard is that each of the firms knows the position the financial regulators are in, and they take on more risk as a result.

IRS Announces 2011 VITA Grant Recipients [TaxProf Blog]
Glenn Beck can rest easy, ACORN isn’t on the list.

Annual Bean Counters Contest [The Summa]
Jump over to the The Summa for the chance to win fabulous prizes!

Kissing up Like a Pro: A New Study Says How to Do It Right [FINS]
Brown-nosing is just as much about science as it is about art, says a study on the matter.

Sex Tops Salary in Quest to Unravel Last Taboo [Bloomberg]
Matthew Lynn would like to know how much you make. And while we’re at it, you might as well throw your credit card debt balances in there too, “In reality, we’d all be better off if we revealed our finances. We would get a fairer deal, feel more secure, and be less likely to run up crazy debts. If we’re comfortable talking about sex or death with everyone, we should be able to talk about money.”

Corn Mafia Henchmen at Cargill Gobble Up Crap Bank Assets [JDA]
Maize, and the companies that are getting filthy rich from it, are quickly becoming Adrienne’s new obsession.

36% of Clients Are Dissatisfied and Already Shopping for Another Accounting Firm [CPA Trendlines]
A CCH report suggests you best put those aforementioned brown-nosing (aka client service) skills to work.

Former Ernst & Young XBRL leader joins Deloitte [Accountancy Age]
Josef Macdonald joins as a director from E&Y. Macdonald was previously XBRL leader for E&Y – a computer language for tagging tax information on reports. He also led the International Accounting Standards Board’s (IASB) XBRL team from 2003 – 2007. Macdonald continues to sit on the IASB’s advisory panel and the XBRL International Steering Committee.

Mobile phone kits to diagnose STDs [Guardian]
An app for the clap.

Two senators eye gas tax hike to pay for highways and bridges [On the Money]
Sens. Tom Carper (D-Del.) and George Voinovich (R-Ohio) have written to the chairmen of the National Commission on Fiscal Responsibility and Reform advocating for a 25-cent per gallon tax increase.

“We suggest that the commission include an increase in the federal tax on gasoline and diesel as part of your report to the president,” they wrote. “We suggest that the taxes be increased by one cent per month for 25 months — a total of 25 cents over a three-year period.”

Battles Loom Over Tax Breaks, Spending Cuts [WSJ]
House GOP Whip Eric Cantor and other lawmakers suggested that Republicans in the coming lame-duck session would press for a long-term extension of current tax levels for all earners, despite Democratic opposition. The Bush-era tax cuts expire Jan. 1 unless Congress acts before then.

“I am not for sending any signal to small businesses in this country that they’re going to have their tax rates go up,” Mr. Cantor said on “Fox News Sunday.” Republicans say raising tax rates on higher earners would hit about half of all small-business income. Democrats say that figure is inflasinesses that are structured as small businesses.

Can a Republican House Stop Farm Subsidy Nonsense? Yeah Right [JDA]
Archer Daniels Midland. Have we mentioned how they’re part of the problem? Adrienne reminds us.

Put Your Money Where Your Money Is: The Auditors and the US Midterm Elections [Re: The Auditors]
Francine McKenna goes with the hockey metaphor, “The audit firms put their money more often where the puck is rather than where it’s going and hardly ever chase the puck for strictly ideological reasons.”

Is Internal Audit Meeting the Challenge? Perhaps Not! [Marks on Governance/IIA]
Or, perhaps yes?

Business Groups Back Quick Compromise On Estate Tax [Dow Jones]
Business groups that oppose the federal estate tax say they are willing to back a short-term compromise with congressional Democrats, in order to avoid the tax returning to its highest level in 10 years.

However, Republicans in Congress aren’t ready to back down from their demands for an estate tax rate of 35%, setting up one of the more unpredictable tax battles in Congress’s lame-duck session.

Bloomberg to America: Lay Off The Chinese [Metropolis/WSJ]
“If you look at the U.S., you look at who we’re electing to Congress, to the Senate—they can’t read,” [Hizzoner] said. “I’ll bet you a bunch of these people don’t have passports. We’re about to start a trade war with China if we’re not careful here,” he warned, “only because nobody knows where China is. Nobody knows what China is.”

How Would CFOs Fare on the Couch? [CFO]
“The upside of people who are CFOs is that they’re generally effective communicators, deliberate, prudent. They weigh alternatives, they’re stabilizing, objective, rational, analytical,” says [Dr. Barrie Sanford] Greiff. “But for every upside, when you turn up the intensity, you can find these descriptions, too: overcautious, overanalytic, very controlling, and lacking in a certain degree of flexibility.”

UGA accounting school receives $1 million [AJC]
Thanks, Ernst & Young.

The World’s Most Powerful People [Forbes]
Behind every powerful person is an accountant that is sick of putting up with his/her shit.

‘Tax Lady’ Roni Lynn Deutch unfazed by state fraud suit [Sacramento Bee]
And now that Jerry Brown is going to Governor (again), he actually has bigger problems.

Do Employees Still Feel Lucky to Have Jobs? [You’re the Boss/NYT]
“Though the economists say the recession was over months ago, the small-business owners I talk to have not seen sales rebound to where they were. Some businesses haven’t rebounded at all. I have been in business for more than 30 years, and I have never seen anything like this. It’s like a normal recession but with an extra year or two thrown in. Yes, things have stabilized, and in some cases they have gotten better. On the human side, things are precarious.”

Just Say No [TaxVox]
Kim Rueben writes, “There were about a hundred ballot initiatives affecting state budgets, some increasing states’ abilities to raise revenues or determine spending levels and others curtailing them. For better or worse, in most cases the voters said no and the status quo remained.”

Deloitte Ranked Largest Forensics and Dispute Advisory Practice [PR Newswire]
“Deloitte’s performance validates the depth, breadth and quality of forensic and dispute services that we offer our clients,” said Greg Swinehart, partner and leader of the forensic and dispute services practice of Deloitte Financial Advisory Services LLP. “The combination of deep technical experience, proprietary leading-edge technology and analytical tools, and access to the global network of DTTL member firms and their affiliates, allows us to quickly deploy experienced teams virtually anywhere around the world to help address our clients’ complex needs.”

Qantas Grounds Airbus A380 Fleet After Emergency Landing [Bloomberg]
An engine exploded. Nothing major.

NetSuite to buy Sage? [AccMan]
Just kicking some ideas around.

The Big Four Accounting Firms Are Down to Critical Mass: Says the Financial Times – So It Must Be Official [Re:Balance]
Jim Peterson reacts to the recent Financial Times article on the Big 4 stranglehold.

TIGTA Releases FY 2011 Audit Plan [TaxProf Blog]
An approximate outline of the IRS nagging schedule.

Accounting Day, 2010 [The Summa]
Next Wednesday. Mark your calendars.

Patrick Byrne Absent From Third Quarter Earnings Call [White Collar Fraud]
Sam speculates as to the cause of PB being MIA: “Back in the Crazy Eddie days, it was known as ‘SEC induced sudden illness syndrome’ or by the short acronym SIS. Common symptoms include panic attacks, headaches, nausea, cold sweats, trembling, stomach pains, vomiting, and worst of all, diarrhea. At least the weight loss isn’t so bad. However, the SEC commonly refers to anyone suffering from SIS as a SISsy.”

Skilling Pursues Case to Overturn His Conviction [DealBook]
On Monday, Mr. Skilling’s lawyers traveled to Houston to argue before a three-judge panel of a federal appeals court that his conviction should be overturned as a result of the Supreme Court’s ruling. The argument took place in the same courthouse where Mr. Skilling and his colleague Kenneth L. Lay were convicted more than four years ago. Mr. Skilling’s wife and brother (the popular Chicago weatherman Tom Skilling) attended the hearing, according to Bloomberg News.

Terror Trade Tax []
The Terror Trade Tax, as I would name the required additional spending on cargo inspection, will, on the margin, raise costs and therefore discourage trade. It might also raise costs more for exports from countries deemed most suspect, but recall that this package, if not found, might have blown up a plane flying from London to the United States. Had it exploded over the Atlantic, it might have been impossible to know where the package originated.

Officer breaks ‘little’ accountant’s arm, but no charges laid [Toronto Star]
Accountant abuse in Toronto.

Employee-Benefit Costs Concern CFOs Most [Real Time Economics/WSJ]
A new survey of 508 U.S. chief financial officers and senior comptrollers find far more of them (84%) worried about rising employee benefit costs than worried about rising raw material (27%) or energy costs (21%).

The survey found 30% are planning on reducing health-care benefits in the coming year, 23% are planning on reducing bonuses and 18% are planning on reducing stock options or equity based compensation. The survey was conducted by Grant Thornton LLP during the first half of October.

Shortage of internal auditors to fight fraud [Accountancy Age]
A little more than half of internal auditors say they have too few staff to deal with fraud. The research in Deloitte’s first Fraud Survey also concludes that a fifth of those polled said their companies had no formal fraud policy. More than 60% said their vulnerability to fraud had increased in the past 18 months.

Poll: CEO pay needs reform [On the Money/The Hill]
“The corporate governance provisions in the Dodd-Frank Wall Street Reform and Consumer Protection Act focused on policies such as ‘say on pay’ and ‘clawbacks,'” said PwC partner Catherine Bromilow in prepared remarks. “Our survey uncovered other areas that may go further to address CEO pay. As compensation issues continue to be a concern, boards will be well-served by closely examining their compensation policies and how their rewards link to company performance.”

Fair Tax Isn’t Just a Bad Tactic; It’s a Bad Idea [Tax Update Blog]
Joe Kristan sheds light on the fair tax hype.

The Tax Increase No One’s Talking About [TaxVox]
The stimulus bill (the American Recovery and Reinvestment Tax Act of 2009) provided $287 billion in tax cuts for 2009 and 2010 but most provisions expire at the end of this year. (Congress extended some of the business tax cuts during the summer.) The big kahuna is the Making Work Pay credit—nearly $60 billion a year going to most workers—but partial exemption of unemployment compensation, expansion of EITC and education credits, and greater refundability of the child credit deliver nearly $20 billion more. Taxes will jump for more than 95 percent of Americans when those cuts evaporate come January.

US rep.: Estate tax rise has some planning death [AP]
U.S. Rep. Cynthia Lummis says some of her Wyoming constituents are so worried about the reinstatement of federal estate taxes that they plan to discontinue dialysis and other life-extending medical treatments so they can die before Dec. 31.

Did Obama Really Cut Small-Business Taxes 16 Times? [You’re the Boss/NYT]
A little fact checking of the President’s tax cut rhetoric.

BDO to question Freeman about fraud in E.S. Bankest retrf=”http://www.bizjournals.com/southflorida/print-edition/2010/10/29/bdo-to-question-freeman-about-fraud-in.html”>SFBJ]
Former court-appointed receiver and convicted fraudster Lewis B. Freeman can be questioned under oath about how his crimes may have influenced his testimony in a 2007 court case against Miami-based accounting firm BDO Seidman.