In a business environment where a damaging Twitter post can have disastrous effects on a company’s financials, reputational risk remains the top nonfinancial concern for corporate directors, according to a new survey report. Another risk rooted in technology—cybersecurity and information technology risk—is rising quickly among directors’ concerns, according to the
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Federal courts disagree on health care credits for federal exchanges
The appellate courts for the D. C. Circuit and the Fourth Circuit issued conflicting decisions on Tuesday regarding the availability of the Sec. 36B premium tax credit for taxpayers who purchase health insurance on exchanges set up by the federal government. The D.C Circuit held that the regulation permitting taxpayer’s
Final rules issued on bona fide indebtedness and terminating partnership’s startup expenses
On Tuesday, the IRS issued T.D. 9682, which finalized proposed regulations relating to basis of indebtedness of S corporations to their shareholders that provide that S corporation shareholders increase their basis of indebtedness of the S corporation to the shareholder only if the indebtedness is bona fide, which is determined
What the PCAOB’s new related-party standard means for auditors
A new PCAOB related-party auditing standard may cause audit firms to revise their audit plans and methodologies to ensure that newly required procedures are fully incorporated into all phases of the audit. The PCAOB issued Auditing Standard (AS) No. 18, Related Parties, on June 10 along with amendments to auditing
Big Data tops issues facing forensic and valuation accountants
Electronic data analysis, also known as “Big Data,” is the most pressing issue that forensic and valuation services (FVS) accountants expect to face in the near future, according to survey results released Tuesday by the AICPA. A quarter of respondents to the 2014 AICPA Survey on International Trends in Forensic
New rules on covered asset acquisitions will shut down transactions to avoid Sec. 901(m)
In Notice 2014-44, the IRS announced that it would issue regulations to prevent taxpayers from misapplying the statutory disposition rule in cases where the gain or loss from the disposition of the relevant foreign asset (RFA) is recognized for U.S. income tax purposes but not for foreign income tax purposes.
PCAOB reaches agreement with audit regulator in Denmark
The PCAOB and Denmark’s audit regulator have entered into a cooperative arrangement for oversight of audit firms in their respective jurisdictions, the PCAOB announced Friday. A framework for joint inspections is provided in the agreement with the Danish Business Authority. The agreement allows for the exchange of confidential information and
Revenue transition group debates difficult implementation issues
A lively discussion by a new revenue recognition transition resource group gave FASB and the International Accounting Standards Board (IASB) plenty of views to consider as they ponder how to help preparers with implementation questions related to the revenue recognition standard issued in May. The resource group, which met for
Definitions of R&E expenditures are amended under final rules
The IRS issued final regulations on which amounts paid or incurred in connection with the development of tangible property, including pilot models, qualify for the Sec. 174 deduction (or amortization) for research and experimental expenditures (T.D. 9680). The regulations finalize proposed rules issued last September (REG-124148-05), with a few changes
Effective date of fiduciary fee unbundling rules delayed until 2015
In response to a comment that the current effective date of the new rules on fiduciary fees does not give fiduciaries enough time to implement them, the IRS amended T.D. 9664 to delay the date. As a result, the new rules governing which costs of trusts and estates are subject
Court halts IRS regulation of contingent fees for refund claims
The U.S. District Court for the District of Columbia granted a motion of summary judgment and issued an injunction to prevent the IRS from regulating contingent fee arrangements for the preparation and filing of ordinary refund claims under Circular 230, Regulations Governing Practice Before the Internal Revenue Service (31 C.F.R.
FASB votes in favor of new consolidation standard
New accounting rules approved by FASB on Wednesday are designed to make financial reporting about consolidation more transparent and consistent. FASB will issue the standard in the coming months, following the drafting of the final Accounting Standards Update (ASU). All public and private companies that apply variable-interest entity (VIE) guidance
Partnership interest expense allocation rules are finalized
The IRS has finalized, without substantive changes, proposed regulations that were issued in conjunction with temporary regulations in January 2012. The final regulations make permanent four changes to the rules for allocating and apportioning interest expense for partners in partnerships (T.D. 9676). The first change is to the method for apportioning
AICPA sues IRS to stop return preparer program
The AICPA filed suit in the U.S. District Court for the District of Columbia on Tuesday, asking the court to halt the IRS’s recently introduced Annual Filing Season Program. The AICPA’s three-count complaint asks the court to declare the rule implementing the program unlawful and stop its operation. The Annual
FASB proposals on inventory, extraordinary items seek simplification
FASB published proposals Tuesday that are designed to simplify the measurement of inventory and eliminate the concept of extraordinary items. The proposals are part of FASB’s simplification initiative, which is designed to reduce cost and complexity in financial reporting while improving or maintaining the usefulness of information to users through
No answer yet for private companies on acquired intangible assets
Accounting for intangible assets in a business combination was one of the first issues the Private Company Council (PCC) attempted to tackle in its mission to simplify accounting for private companies after it was formed in 2012. But after more than three hours of deliberation Tuesday, an answer remains elusive
Fighting identity theft, IRS issues final rules on truncated identification numbers
The IRS issued final regulations (T.D. 9675) that allow the use of truncated taxpayer identification numbers (TTINs) on payee statements and certain other documents where not prohibited by the Internal Revenue Code, applicable regulations, or other guidance published in the Internal Revenue Bulletin, forms, or instructions. The regulations finalize the
One-IRA-rollover-a-year rule will be effective in 2015, IRS says
Following up on its promise earlier in the year to follow the Tax Court’s holding that the limit of one rollover per year applies on an aggregate basis and not on an IRA-by-IRA basis, the IRS withdrew a proposed regulation from 1981, Prop. Regs. Sec. 1.408-4(b)(4)(ii), which had provided otherwise
E-filing of amended returns, elimination of Form 1040X among TIGTA recommendations
Taxpayers should be allowed to use Form 1040 to amend their returns and should be able to e-file amended returns, according to recommendations made by the Treasury Inspector General for Tax Administration (TIGTA) on Wednesday (TIGTA Rep’t No. 2014-40-028). Although individual tax returns in the Form 1040 series may all
Six ways not-for-profits can get value from risk management
Many not-for-profits lack the resources to implement a holistic approach to risk across the enterprise. So it’s no surprise that they often lag behind public companies in implementing enterprise risk management (ERM). Indeed, just 13% of not-for-profits responding to a recently released survey said they have complete formal enterprise-wide risk
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