Accounting News Roundup: Brits Investigating Services KPMG Provided BAE Systems; How Many Times Did Harry Reid Vote to Increase Taxes?; PwC Scoffs at ‘Big 5’ Idea | 10.25.10
BofA Finds Foreclosure Document Errors [WSJ]
The Charlotte, N.C., lender discovered errors in 10 to 25 out of the first several hundred foreclosure cases it examined starting last Monday. The problems included improper paperwork, lack of signatures and missing files, said people familiar with the results. In certain cases, information about the property and payment history didn’t match.
KPMG investigated over BAE audit [Accountancy Age]
The investigation by the Accountancy and Actuarial Discipline Board (AADB) focus British Aerospace/BAE Systems between 1997 and 2007, looking at commissions paid by BAE to subsidiaries, agents or other companies.
Any professional advice, consultancy or tax work provided to BAE by KPMG during that period will also come under the microscope in relation to commission payments. The investigation will focus on commissions connected to three legal entities: Red Diamond Trading; Poseidon Trading Investments; and Novelmight.
Key Tax Breaks at Risk as Panel Looks at Cuts [WSJ]
The tax benefits are hugely popular with the public but they have drawn the panel’s focus, in part because the White House has said these and other breaks cost the government about $1 trillion a year.
At stake, in addition to the mortgage-interest deductions, are child tax credits and the ability of employees to pay their portion of their health-insurance tab with pretax dollars. Commission officials are expected to look at preserving these breaks but at a lower level, according to people familiar with the matter.
Harry Reid Voted to Raise Taxes ‘Only’ 51 Times [TaxProf Blog]
Apparently there was some talk that it was actually in the ballpark of 300.
Reflections on the Basel Committee Principles for Enhancing Corporate Governance [Marks on Governance/IIA]
News you can use.
Business leaders press administration for repeat on tax break [On the Money/The Hill]
The National Association of Manufacturers and other groups argue allowing companies to “repatriate” money earned abroad to the U.S. at a lower tax rate could spur the economy by providing businesses with a burst of cash they could invest in their companies.
“The business community is looking at ways to jumpstart the economic recovery and here is one you could do without increasing the deficit,” Dorothy Coleman, vice president of tax and domestic economic policy for the manufacturers.
PwC slates FRC idea to create Big Five [Accountancy Age]
Paul Woolston, head of public sector assurance at PwC, criticised the Financial Reporting Council’s suggestion the Audit Commission be used to create a fifth player in the audit industry, currently dominated by the Big Four – PwC, Ernst & Young, Deloitte and KPMG.
“It is at least ironic that the FRC has said what it has, in that the Audit Commission itself has operated with a large monopoly,” he said.
“It is odd that the FRC is concerned about any one organisation having the market share.”
SEC Aims to Streamline Complaint Process [WSJ]
The launch is a step in the agency’s efforts to avoid bottlenecks and duplication in the handling of complaints, which traditionally have been fielded by individual SEC offices and filed there. Complicating matters is the variety of forms in which such complaints come—mail, phone calls, emails and interviews.
“This process is going to ensure that it’s all transferred into a structured format so that it can be more easily searched and analyzed,” Robert Khuzami, director of enforcement, said in an interview.
“We will have all of it in one place, searchable, which will do a lot for us in the long run,” he said.
Thus Far under Obama, the Only Individuals Paying Higher Taxes Are Smokers and Tanners, But They May Have Company Soon [Tax Foundation]
Jersey Shore quips go here.
Accounting News Roundup: Tax Cut Political Football Goes Flat; Google’s Remarkable Tax Planning; Yes, IRS Agents Are Strapped | 10.21.10
Tax Cuts Slide To Back Burner On Campaign Trail [WSJ]
It’s a sign that a decision by Democratic leaders, to put off a vote on extending the tax cuts until after the Nov. 2 elections, may be paying off politically.
“It’s harder to write an ad portraying a vote that hasn’t happened yet,” said Brian Gaston, a former senior aide to House GOP leaders and now a lobbyist at the Glover Park Group.
Google 2.4% Rate Shows How $60 Billion Lost to Tax Loopholes [Bloomberg]
Google y $3.1 billion in the last three years using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda.
Google’s income shifting — involving strategies known to lawyers as the “Double Irish” and the “Dutch Sandwich” — helped reduce its overseas tax rate to 2.4 percent, the lowest of the top five U.S. technology companies by market capitalization, according to regulatory filings in six countries.
TUI Travel CFO Quits After Accounting Error [Dow Jones]
In an embarrassing admission, the company said an ongoing audit for the fiscal year ended September 2010 had highlighted the accounting error in the integration of IT systems in its U.K. mainstream business that had accrued over a period of four to five years and which increased its total write-off for 2009 from GBP29 million to GBP117 million.
Chief Executive Peter Long told Dow Jones Newswires that the issue had been identified when it reported its third-quarter results but continued to investigate the matter and “only last night were we able to determine the scale of the problem.”
Banks Clueless on Foreclosure Mess Severity [Jonathan Weil/Bloomberg]
The biggest U.S. mortgage lenders and servicers say they’re putting the foreclosure mess behind them, and that it never was a major problem. The reality is these companies are so big and unmanageable, the people in charge of running them have no way to know if that is true.
One thing that remains unknowable is how many flawed home- mortgage records and foreclosure proceedings are out there waiting to be unearthed. Dozens of federal and state agencies are investigating. It’s anyone’s guess what they might turn up.
NJ man cashes $158G check IRS mistakenly sent him [Asbury Park Press]
He figured no one would notice.
For ‘B-to-B’ Companies, Finding Facebook ‘Friends’ Can Be a Struggle [WSJ]
These days, even small “business-to-business” concerns like Bill.com are experimenting with social media, perceiving the popular online hangouts as low-cost, easy-to-use venues for attracting new customers and retaining existing ones. But unlike their consumer-focused counterparts—retailers that sell smartphones, jeans, games and other personal products—so-called B-to-B businesses seem to be having a harder time connecting with their target audience.
Some IRS agents carry guns, too, agents tell UAB accounting student group [Birmingham News]
“My first day on the job, I thought, ‘Why are they carrying guns?'” said Donald Smith, a UAB graduate and special agent with the IRS-Criminal Investigation unit.
Korea wants G20 to delay accounting standard consolidation [Korea Times]
Apparently they have a say in the matter