CBO Sees U.S. Debt Reaching 107% of GDP in 2040

Driven by growing budget deficits, U.S. government debt held by the public will exceed 100% of GDP in 2040, up from the current 74%, according to a new Congressional Budget Office report.To keep the federal debt-to-GDP ratio at its current level, Congress would have to increase revenues by 6% or ...

By Matthew Heller • June 17, 2015

Know Your SEC

Eighty-one years ago this month, President Franklin D. Roosevelt signed into law the Securities Exchange Act of 1934, which created the Securities and Exchange Commission. The SEC is headed by five commissioners serving five-year terms, with one commissioner designated by the president as chairma...

By CFO Editorial Staff • June 17, 2015

Explore the Trendline➔

Tax policy shifts: What CFOs need to know to stay ahead

Discover how evolving tax policies are creating new opportunities and challenges for CFOs.

By CFO.com staff

High-Yield Firms’ Cash Falls 9% to $281B

Cash holdings at speculative-grade companies fell 9% to $281 billion in 2014, reflecting growth in capital spending and heavy use of cash to fund dividends and share buybacks, according to a new report from Moody’s Investors Service.Speculative-grade companies spent 397% of their discretionary ca...

By Matthew Heller • June 16, 2015

Gap Closing Stores, Potentially Laying Off Thousands

Retailer Gap Monday announced that it plans to close about 175 stores in North America and some stores in Europe over the next few years to boost profitability, with about 140 closures this year.It did not disclose how many employees in total would be laid off, but the San Francisco-based retaile...

By Katie Kuehner-Hebert • June 16, 2015

Oil Glut May Last Until 2016

The supply of oil has exceeded demand globally for the past five quarters, largely due to the Organization of Petroleum Exporting Countries vying to gain more market share, according to International Energy Agency data.OPEC supply rose 50,000 barrels per day in May, to total 31.33 million barrels...

By Katie Kuehner-Hebert • June 16, 2015

The Fed’s Interest-Rate Projections: Dotty

Investors obsess over the Federal Reserve’s “dot-plots.” These charts show the rough trajectory that senior Fed officials think its benchmark interest rate should follow over the next few years.Before every second meeting of the rate-setting Federal Open Market Committee (FOMC), members say how h...

By Economist Staff • June 16, 2015

How Artificial Intelligence Can Boost Audit Quality

As a CPA and audit partner, I don’t do robots or self-driving cars.Jon Raphael But a number of my clients do. They are innovating in many fields. Computers have discovered new drugs for treating cancer. Machines can recognize human faces better than, well, humans. The auditing profession can’t co...

By Deloitte & Touche and Jon Raphael • June 15, 2015

Balancing Acts

How hard is it to have a life these days? For CFOs, very hard. Only 12% of finance chiefs manage to strike a 50–50 balance between their work and their personal lives. For the rest, work commands most of their time, energy, and attention. Eighty-five percent of finance chiefs say work takes up at...

By CFO Editorial Staff • June 15, 2015

IRS Unveils ‘Sweeping’ Effort to Fight Refund Fraud

In the wake of an online attack that bilked the Internal Revenue Service out of at least $39 million in fraudulent refunds, the agency has announced it is teaming up with tax-preparation firms and state officials to fight identity theft and fraud.As part of what it called a “sweeping new collabor...

By Matthew Heller • June 12, 2015

Honda Setting Aside Another $363M for Recall

Honda Motor is taking another hit from a growing recall of air bags, saying Friday it is setting aside another $363 million to pay for recall costs.The additional spending will be booked for the year that ended on March 31, rather than during the current year. Under U.S. accounting rules, it woul...

By Matthew Heller • June 12, 2015

Labor Costs Up Sharply for 2nd Straight Quarter

In an indication that U.S. workers may finally be getting a meaningful raise, labor costs increased 4.9% in the first quarter compared to the same period last year, according to the U.S. Department of Labor.Average cost per hour worked rose to $33.49 in March, versus $31.93 a year earlier, the de...

By Matthew Heller • June 12, 2015

FedEx to Take $2B Charge on Accounting Change

FedEx said Friday it will record an estimated $2.2 billion non-cash, pretax charge for the fourth quarter as a result of ts decision to switch to mark-to-market pension accounting.The change in accounting method enables FedEx to recognize actuarial gains and losses in the fourth quarter of its fi...

By Katie Kuehner-Hebert • June 12, 2015

Five Steps to Revenue Recognition Tax Woes

Already so complex that the Financial Accounting Standards Board has proposed extending the compliance deadline for its new revenue recognition regime by a year, the updated standard could trigger another burdensome source of complexity for corporate taxpayers, the Internal Revenue Service says.T...

By David Katz • June 11, 2015

Tesla Motors CFO Ahuja to Retire This Year

Deepak Ahuja will retire later this year as CFO of Tesla Motors, just as the company is poised for “intensive growth,” Reuters reports.Tesla CEO Elon Musk broke the news Tuesday at the electric car maker’s annual shareholder meeting. Ahuja will help search for a successor before retiring.“Togethe...

By Katie Kuehner-Hebert • June 10, 2015

Nike Settles $10M Suit Against Ex-Designers

Nike has settled a $10 million lawsuit that accused three of its former designers of stealing a “treasure trove” of trade secrets so they could start a footwear design studio for German rival Adidas.An attorney for the designers — Denis Dekovic, Marc Dolce and Mark Miner — said the case against t...

By Katie Kuehner-Hebert • June 10, 2015

Facebook’s Overseas Ad Sales Reach 51% of Total

Overseas advertising markets are now more lucrative for Facebook than the U.S. market, accounting for 51% of global ad sales in the first quarter, Reuters reported.Total advertising revenue for the quarter increased 46% to $3.3 billion, the vast majority of Facebook’s $3.5 billion in quarterly re...

By Matthew Heller • June 10, 2015

Companies Raise the Bar for Golden Parachutes

Amid growing pressure from shareholders, it’s taking more to trigger a golden parachute payment to an executive, a new Towers Watson report has found.According to the consulting firm, some 95% of the 340 Fortune 500 companies that offer severance upon a change in control now also require a corres...

By Matthew Heller • June 10, 2015

CPAs Cite Hiring, Retention As Most Pressing Issue

Talent-pool concerns have emerged as the most pressing issue for all but the smallest CPA firms as the accounting industry returns to a growth environment, according to a new survey.In the 2015 edition of the CPA Firm Top Issues Survey, the American Institute of Certified Public Accountants (AICP...

By Matthew Heller • June 9, 2015

G7 to Clamp Down on Tax Avoidance Via Transfer Pricing

G7 leaders Monday pledged to reform the international tax system by minimizing transfer pricing, according to Public Finance International. Transfer pricing involves internal transactions between a large company’s subsidiaries for items such as supplies or branding, but it can also be used to mov...

By Katie Kuehner-Hebert • June 9, 2015

HSBC To Slash Up to 25,000 Jobs, Sell Units in Turkey, Brazil

HSBC Tuesday announced that it was planning to cut up to 25,000 jobs and sell units in Turkey and Brazil, as part of its “actions to capture value from [its] global presence in a changed world.”Europe’s largest bank outlined 10 “strategic actions,” which also included reducing “risk-weighted asse...

By Katie Kuehner-Hebert • June 9, 2015

Help Wanted: IPO-Savvy CFO

A CFO with experience taking a company public is in the catbird seat these days. As part of the same equation, it’s gut-check time for venture capital investors looking to hire a full-fledged finance chief a year or two before an anticipated IPO.The boon or bane, depending on where one sits, is a...

By David McCann • June 9, 2015

Congress Mulls Tax Breaks For Income On Intellectual Property

Congress is mulling whether to give tax breaks to high-tech firms, pharmaceutical manufacturers, and other companies on income from their intellectual property.  But lawmakers might run into trouble if they don’t also consider breaks for other manufacturers, retailers, and small businesses, accor...

By Katie Kuehner-Hebert • June 9, 2015

Computer Sciences, Ex-CFO Settle SEC Fraud Charges

The Securities and Exchange Commission on Friday charged Computer Sciences Corp. and former company executives with accounting and disclosure fraud. It hid that the company was losing money because of failure to meet contract deadlines for its largest client, U.K.-based National Health Service, t...

By Katie Kuehner-Hebert • June 8, 2015

SEC Accuses 4 of Insider Trading on Secondary Offerings

The U.S. Securities and Exchange Commission has charged a stock trader and three associates with making $3.2 million in illicit profits by trading on inside information about secondary stock offerings they had stolen from investment banks.According to a civil complaint, former day trader Steven F...

By Matthew Heller • June 4, 2015

Belief in Wellness Savings May Require Leap of Faith, but They’re Real

Can wellness programs be cost-effective? It depends on what you value.Let’s start with what everyone who can access the Internet can find out: there are quite a number of independent articles, analyses, and white papers that say wellness programs have a positive ROI. Most range in the $1.50 to $3...

By Mike Tinney • June 3, 2015