Regulators are asking whether the increasing provision of nonaudit and consulting services by audit firms poses risks to audit quality, and the PCAOB plans a formal examination of the issue in 2014. The PCAOB plans to hold round-table discussions on the issue next year with audit firm leaders and other
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IIRC releases International Integrated Reporting Framework
The International Integrated Reporting Council (IIRC) on Sunday made public an approved framework for integrated reporting. The group intends for the framework to guide companies on how to best communicate with their stakeholders. The release represents a key step forward for integrated reporting (IR). The aim of IR is to
PCAOB seeks improvement in engagement quality reviews
A PCAOB report released Friday instructs audit firms to take steps to ensure that engagement quality reviews detect the audit deficiencies they are meant to identify. Although firms’ methodologies reviewed by the PCAOB were generally consistent with the requirements of Auditing Standard No. 7, Engagement Quality Review, the report says
Proposed rules would require terminating partnerships to amortize startup expenditures
On Friday, the IRS issued proposed regulations aimed at preventing partnerships from using technical terminations to accelerate their deductions of startup and organizational expenses (REG-126285-12). When finalized, the regulations will apply to technical terminations of partnerships that occur on or after Dec. 9, 2013. Under Sec. 708(b)(1), a partnership terminates
Standard mileage rates go down slightly in 2014
Optional standard mileage rates for use of a vehicle will go down by one-half cent per mile for 2014, the IRS announced (Notice 2013-80). Taxpayers can use the optional standard mileage rates to calculate the deductible costs of operating an automobile. For business use of a car, van, pickup truck,
Finance executives show increasing optimism about their companies
U.S. finance executives’ optimism about the domestic economy cooled in the past three months, but they were more bullish about the near-term prospects of their own businesses. CPA decision-makers are increasingly positive about their own businesses’ revenue and profit, especially when compared with a year ago. That sunny view offsets
Numerous provisions expire at year end
Taxpayers and practitioners breathed a sigh of relief in January when Congress passed the American Taxpayer Relief Act of 2012 (ATRA), P.L. 112-240, at the last minute, bringing some certainty to a host of provisions that had been uncertain. Many expired and expiring provisions were extended by ATRA, including the
PCAOB proposal could result in public tracking of auditors
At first, the names of audit engagement partners disclosed in public company audit reports might not mean much to investors, PCAOB Associate Chief Auditor Jessica Watts said Wednesday as she described a new board proposal. Initially, little public information about engagement partners would be available, Watts said, under a PCAOB
Supreme Court resolves circuit split on 40% gross valuation misstatement penalty
On Tuesday, the U.S. Supreme Court held that the 40% penalty for a gross valuation misstatement applied when the partnerships at issue had been determined to be shams that lacked economic substance, and, as a result, the partners’ outside basis in the partnerships was zero (Woods, No. 12-562 (U.S. 12/3/13),
AICPA groups seek consistency in insurance contract standards
Comment letters to accounting standard setters submitted jointly by an AICPA committee and expert panel urge convergence on at least some critical issues in financial reporting rules for insurance contracts. The AICPA Financial Reporting Executive Committee and Insurance Expert Panel advised FASB and the International Accounting Standards Board (IASB) that
FASB to seek feedback on accounting for income taxes
FASB plans to ask financial statement users, preparers, auditors, and others for feedback on how to best address concerns about its standard on accounting for income taxes. The board also plans to ask stakeholders whether addressing those concerns should be a priority in comparison to other projects that could be
PCAOB proposal to name engagement partner may generate debate
A vigorous debate is expected as the PCAOB prepares to repropose a rule that would require engagement partners’ names to be disclosed in public company auditor’s reports. The PCAOB has announced that it will consider making a reproposal on Wednesday. The board will welcome public comment on the issue, and
IASB proposes amendments to IAS 27 to allow equity method
Narrow-scope amendments to IAS 27 proposed Monday by the International Accounting Standards Board (IASB) would allow entities to use the equity method to account for investments in subsidiaries, joint ventures, and associates in their separate (parent-only) financial statements. The proposed changes are designed to reduce compliance costs while providing information
PCAOB to consider requiring name of engagement partner in auditor’s report
The PCAOB will consider reproposing amendments to auditing standards that would require disclosure in the auditor’s report of the name of the engagement partner and certain other participants in the audit. This topic will be considered during a meeting at 9:30 a.m. EST on Dec. 4, and has been a
Final rules released on 0.9% Medicare surtax
The IRS issued final regulations governing the 0.9% Medicare surtax, which took effect this year (T.D. 9645). The regulations contain guidance for employers and individuals on the implementation of the tax, including the requirement to file a return reporting the tax, the process for employers to make adjustments of underpayments
ARSC proposes framework for compilation and review engagements
A new proposal by the AICPA Accounting and Review Services Committee (ARSC) will provide a framework for performing and reporting on compilation and review engagements. The proposal, resulting from ARSC’s clarity project, also sets forth the meaning of certain terms used in Statements on Standards for Accounting and Review Services
Final and proposed regs. issued on 3.8% net investment income tax
Late on Tuesday, the IRS issued final and proposed regulations giving guidance on the application and computation of the 3.8% net investment income tax imposed by Sec. 1411 (T.D. 9644 and REG-130843-13). The final regulations adopt, with changes, proposed regulations issued late in 2012. Starting in 2013, Sec. 1411 imposes
AU-C identifier retained indefinitely
The “AU-C” section identifier will be retained indefinitely for clarified auditing standards developed by the AICPA Auditing Standards Board. Established for the clarified auditing standards to avoid confusion with references to the “AU” sections in AICPA Professional Standards, the AU-C identifier had been scheduled to revert to the AU identifier
IRS proposes curbing political activities of Sec. 501(c)(4) social welfare organizations
The IRS announced its intention on Tuesday to amend the regulations governing social welfare organizations, a topic that has recently created an enormous amount of political controversy, especially during the recent scandal over how the IRS was mishandling applications from groups that had “tea party” and other terms in their
Top risk for businesses: Regulation, compliance overload
Corporate directors believe regulatory and compliance overload is the greatest risk facing their business, well ahead of cyber threats and corruption, a new survey shows. Also, board members seem skeptical about some new proposals from the PCAOB regarding the auditor’s reporting model. That’s according to the latest BDO Board Survey,
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