Newly Formed Law Firm Raises Questions

BY L. HAROLD LEVINSON

The Highlights item, “E&Y First in U.S. to Ally Itself With Law Firm,” ( JofA, Dec.99, page 4) reports that the new law firm of McKee Nelson Ernst & Young will be “fully independent,” and exempt from current fee-sharing restrictions because Ernst & Young has made a loan rather than an equity contribution.

Both conclusions are questionable.

If E&Y is not a partner in the law firm, the inclusion of its name in the new firm’s name raises questions under the rules prohibiting misleading and deceptive firm names. If, however, E&Y is a partner, questions arise under the rules on who may be a partner in a law firm.

In any event, your conclusion that the law firm will be “fully independent” is, to say the least, nave, as well as premature.

L. Harold Levinson
Professor of Law Emeritus
Vanderbilt University
Nashville

SPONSORED REPORT

How the election may affect taxation of business income

This report summarizes recent proposals to reform the U.S. business income tax system and considers the path to enactment of any such legislation.

VIDEO

How to Excel pivot a general ledger

The general ledger is a vast historical data archive of your company's financial activities, including revenue, expenses, adjustments, and account balances. J. Carlton Collins, CPA, shows how to prepare data for, and mine data with, PivotTables.

QUIZ

Did you follow 2016’s biggest accounting news?

CPAs will remember 2016 as a year of new standards and new faces. How well did you follow the biggest accounting events? The 7 questions in this quiz will help you find out