Friday Footnotes: Sorry Clients, Most Firms Are Raising Fees; The Ghost Preparer | 8.22.25

Posted on by Going Concern News Desk
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Law & Order

Ghost story: Augusta accountant sentenced for running phantom tax-preparation scheme [Augusta Chronicle]
Prosecutors say Kim Brown ran a business out of her Augusta home in 2022 as an income tax return “ghost preparer,” an IRS term describing people who don’t properly identify themselves on tax returns as paid preparers.

Accounting firm settles OCR ransomware investigation [Nixon Peabody]
BST is a New York public accounting, business advisory, and management consulting firm. It serves as a HIPAA business associate based on its representation of a covered entity client and corresponding receipt of financial information containing protected health information (PHI). In February 2020, BST filed a breach notification report with OCR upon discovering a December 2019 ransomware attack on its network. BST reported that the ransomware impacted the PHI of its covered entity client, a New York-based physician group, and was externally introduced via a phishing email. The breach reportedly affected the PHI of 170,000 individuals.

Accounting Firm’s $1.4 Million Spat With Ex-Partner Won’t Expand [Bloomberg Law]
A lawsuit over a $1.4 million retirement payout to a former partner of a Connecticut accounting firm Knight Rolleri Sheppard CPAs won’t expand to include the former partner’s counterclaims against the firm’s current leadership. The firm’s current partners scored a court order dismissing defendant Michael Knight’s counterclaims, which accused them of financial malfeasance after his retirement.

Oopsies

WH Smith shares tumble 42% after accounting blunder [BBC]
WH Smith shares slumped 42% on Thursday following an accounting error which led it to overstate its North America profits. The company has cut its profit forecasts in the region as a result and has ordered a review by auditors. It said the mistake was because of an issue in how it calculated the amount of supplier income it received essentially causing it to be logged too early. Analysts said the blunder was a “huge embarrassment” for WH Smith.

Practice

2025 Accounting and Tax Pricing Benchmark [Ignition]
80% of US accounting firms plan to increase fees in 2026.

Quote of the Day

Accountancy firm’s youngest intern is 15 [Royal Gazette (Bermuda)]
“It beats packing groceries,” he said.

AI

Challenges of adopting AI in accounting firms [Thompson Reuters]
79% of tax, accounting, and audit professionals expect artificial intelligence (AI) to have a high or even transformational impact on the future of their industry. But only 14% say their firms have a defined AI strategy in place. With AI adoption comes issues such as data privacy and security concerns, high costs and complexity of integration, and regulatory compliance.

AI workloads are surging. What does that mean for computing? [Deloitte]
As organizations continue to accelerate their artificial intelligence capabilities, data center strategies are evolving rapidly to keep up with the fluctuating computing demands. Deloitte research (detailed in our previous article, “Is your organization’s infrastructure ready for the new hybrid cloud?”) shows a range of infrastructure approaches organizations are exploring based on factors like cost, latency, and hardware needs. The possibilities range from a rush off of the mainframe, to informing new hybrid cloud strategies, to establishing a new market for AI factories. These factories could handle tasks ranging from standard inferencing to high-performance computing at a tremendous scale.

Related Posts

Accounting News Roundup: The Role of the Interim CFO; Taxes and the War on Terrorism; A Peek at Facebook’s Books | 09.08.11

When CFOs Become Interim CEOs [CFOJ]
The ascension of CFO Tim Morse to the CEO position at Yahoo is unusual, especially when, as with Morse, the interim tag is applied. In the rare instances when a CFO assumes the interim chief executive position, it’s often because the company doesn’t have a more obvious choice among its operational executives, and wants to nonetheless project a sense of stability.

Blunt E-Mail Raises Issues Over Firing at Yahoo [NYT]
In the upper echelons o executives are forever leaving to pursue urgent opportunities, develop important new ventures or, that old standby, spend more time with their long-neglected families. Hardly anyone ever admits to being sacked. Even in cases where the executive has all but been bodily ejected from his executive suite — Rick Wagoner of prebankruptcy General Motors or Tony Hayward of post-oil-spill BP — the most they say is that they have been asked to step aside.

Taxes in the Age of Terrorism: Echoes [Bloomberg]
Since the Sept. 11 attacks, the U.S. has been waging a different kind of war. It’s been both smaller and longer than previous wars, taking less money to fight and more time to win. It’s also been the nation’s first war to be fought entirely on credit.

Tax Cut Extension May Be Tough Sell [WSJ]
President Barack Obama’s push to extend the payroll tax holiday to spur economic growth may not be an easy sell, in part because some economists and lawmakers question if it’s delivering enough bang for the buck. In his speech to Congress Thursday, Mr. Obama is expected to lay out an economic plan with a price tag of $300 billion or more that includes extending the two-percentage point reduction in Social Security payroll taxes paid by employees and reducing the employers’ share.


Facebook doubles first-half revenue [Reuters]
Facebook’s revenue doubled to $1.6 billion in 2011’s first half, a source with knowledge of its financials told Reuters, underscoring its appeal to advertisers while it grapples with intensifying competition from the likes of Google Inc (GOOG.O). Net income in the first half of 2011 came to almost $500 million, according to the source, who wished to remain anonymous because privately-held Facebook does not disclose its results.

Supercommittee May Kick Off Tax Overhaul as It Focuses on Debt [Bloomberg]
The 12-member supercommittee holds its first meeting today in an effort to find $1.5 trillion in cuts in areas including defense spending and Medicare. On taxes, the group is likely to consider setting targets for major changes to be considered over the next year, before Bush-era income tax cuts are set to expire at the end of 2012.

Obama’s whopper of a claim on tax cuts [Fact Checker/WaPo]
The president’s Labor Day speech in Detroit featured an assertion that contained a number of warning signs that it might be an errant fact: “biggest middle-class tax cut in history.” First of all, anytime a politician claims he or she has done something historic, watch your pockets. That’s usually a dubious claim.