Why the SEC Won’t Flip the IFRS Switch

As I have explained in prior columns, there are three techniques that enable CFOs to plan intelligently for the future despite the many unknowns associated with the use of International Financial Reporting Standards (IFRS) in the United States. This month’s column provides an example of one of th...

By Bruce Pounder • Sept. 2, 2010

Six Magic Clicks to Roll Up Daily Records

Editor’s Note: To read more about spreadsheets, share a tip with other readers, or suggest a topic for Bill Jelen to cover in an upcoming column, click here to visit CFO.com’s Spreadsheet Tips page.Every company is swimming in data. Your financial-analysis team undoubtedly has many Excel workbook...

By Bill Jelen • Sept. 2, 2010

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

Fees Still Falling, but Not as Dramatically

A three-year slide in audit fees may be beginning to bottom out. Fees have been dropping for several years now, first as Sarbanes-Oxley work became more routine and then as companies scrutinized expenses in response to the economic crisis.But a recent CFO analysis of audit and audit-related fees ...

By Tim Reason • Sept. 1, 2010

So Much for “Death by Committee”

Audit committees used to press veteran CFO Christine Russell on why her cash investments weren’t earning higher yields. Now, after witnessing liquidity freezes in once-safe havens like auction-rate securities, they are less concerned with making money than with hanging on to it.Scrutinizing a rou...

By Sarah Johnson • Sept. 1, 2010

Cloudy Future for GAAP

By historical measures, U.S. accounting rule-makers were on a relatively fast track this year to improve and meld their rules with those of the International Accounting Standards Board. But that progress may be severely delayed as a result of the surprise exit of Financial Accounting Standards Bo...

By Alix Stuart and Sarah Johnson • Aug. 31, 2010

Suit Based on U.S. GAAP Proceeds

Earlier this month, a U.S. District Court in Puerto Rico rendered an opinion largely against the banking firm of Popular Inc.1 At issue was whether the bank, a publicly traded bank-holding company headquartered in Puerto Rico, violated U.S. generally accepted accounting principles with respect to...

By Robert Willens • Aug. 30, 2010

And the Winner Is…

With 24 nominations, the TV miniseries “The Pacific” is the leading nominee for the 62nd Primetime Emmy Awards, which airs this Sunday. How many winged trophies will it win?Andy Sale knows, but he’s not telling.A partner in Ernst & Young’s Los Angeles office, Sale is one of just a handful of ...

By Joseph McCafferty • Aug. 27, 2010

Finance Execs React to Herz’s Retirement

The announcement on Tuesday that Robert Herz will retire as chairman of the Financial Accounting Standards Board on October 1, two years before his term expires, came as a shock to many accounting executives. After all, they have been busy planning for the major accounting changes that have been ...

By Alix Stuart and Sarah Johnson • Aug. 26, 2010

IFRS North of the Border

In the middle of a major accounting-system changeover, Siim Vanaselja, CFO of Bell Canada Enterprises, pines for the new year, when he’ll have just one set of books to worry about. For now, the communications company uses a trio of accounting rules: Canadian generally accepted accounting principl...

By Sarah Johnson • Aug. 25, 2010

IRS: What’s in Your Reserve?

The Internal Revenue Service is headed down the home stretch with respect to uncertain tax positions. Since June, it has been reviewing public comments on its controversial proposal to require more-detailed disclosures around tax deductions and credits that may not pass muster with the agency. Th...

By Marie Leone • Aug. 24, 2010

Deere’s Lost Research Tax Credits

During each of its taxable years ended October 31, 1997, through October 31, 2001, Deere & Co. received income from operations conducted through unincorporated branches in Germany, Italy, and Switzerland. In calculating the consolidated tax in its 2001 tax return, Deere claimed a credit of $5...

By Robert Willens • Aug. 23, 2010

Health Reform’s 1099 Headache

A little-noticed provision in the Patient Protection and Affordable Care Act is suddenly generating a lot of attention. The new rule requires all businesses to file 1099 forms if they purchase $600 or more in goods or services from another business during a year. While the rule was largely overlo...

By Joseph McCafferty • Aug. 19, 2010

Will FASB’s Breadcrumb Trail Remain?

When the Financial Accounting Standards Board meets on August 18, it will decide whether to give companies more time to vet a proposed update to the rules that govern how companies account for contingent liabilities. FASB gave companies just a month to look over and comment on its proposed revisi...

By Marie Leone • Aug. 17, 2010

Laying Claim to Options Expense Deductions

Guidance from the Internal Revenue Service’s chief counsel, released last summer, opined on the tax treatment of stock-option payments made by a parent company to employees of a former subsidiary. The memo, referred to as a Chief Council Advice, found that these types of option payments give rise...

By Robert Willens • Aug. 16, 2010

Auditors Can More Easily Dispute PCAOB Findings

A little over a month since the Supreme Court blessed its existence, the Public Company Accounting Oversight Board will continue to face scrutiny, now from those it oversees as well as from its overseer.A new rule from the Securities and Exchange Commission, which watches over the nongovernmental...

By Sarah Johnson • Aug. 11, 2010

Revenue Rules Could Cause Software Snags

Recent revenue-recognition guidance from the Financial Accounting Standards Board could lead to accounting software glitches unless affected companies make adjustments, experts warn.The potential problem relates to how enterprise resource planning (ERP) systems allocate revenue for bundled produc...

By Marie Leone • Aug. 10, 2010

The Canadian Spin-Off Edge

The anti-Morris Trust rules do not operate in Canada. That’s the bottom line of a recent court ruling involving a complex reorganization transaction that eventually garnered favorable tax treatment for the parent company.In the United States, the anti-Morris Trust rules, which can be found in Sec...

By Robert Willens • Aug. 9, 2010

IRS Rules on Contingent Debt

A private letter ruling issued by the Internal Revenue Service in March was emphatic about its finding regarding contingent debt. Basically, the retirement of contingent debt does not produce so-called cancellation of indebtedness income. In the letter, the IRS ruled on a complex transfer of stoc...

By Robert Willens • Aug. 2, 2010

Will BP’s Tax Benefit Disappear?

This week BP announced it is taking a second-quarter pretax charge of $32.2 billion related to future costs associated with the ongoing cleanup of the Deepwater Horizon oil spill in the Gulf of Mexico. BP also plans to offset those future losses with a deferred tax benefit, which is a somewhat st...

By Robert Willens • July 30, 2010

IFRS: More Opportunities Than Threats

As a result of the ongoing efforts of the Financial Accounting Standards Board and its overseas counterpart, the International Accounting Standards Board, U.S. generally accepted accounting principles and international financial reporting standards will both change profoundly and become more simi...

By Bruce Pounder • July 29, 2010

A Double Taxation Warning

As the global economy begins to show signs of recovery, it may be a good time to review an Internal Revenue Service ruling, upheld by two courts, related to income generated by foreign subsidiaries of U.S. corporate taxpayers. Indeed, it may not always be possible for a parent company to aggregat...

By Robert Willens • July 26, 2010

Without Hoopla, Fair-Value Rule Is Readied

The debate over one of the most controversial accounting standards in recent memory is coming to a somewhat anticlimactic end. The rule once known as FAS 157, which tells companies how to measure the fair value of assets and liabilities, has been rewritten and rechristened Topic 820. Now in final...

By Marie Leone • July 20, 2010

Compensatory Damages Can Be Tax Deductible

On January 18, 2000, Fresenius Medical Care Holdings Inc. and the United States signed a “Global Agreement” resolving a series of suits against the company on claims of Medicare fraud. The agreement required Fresenius to pay the astonishing sum of $486,334,232 to the United States — $101,186,898 ...

By Robert Willens • July 19, 2010

Sucking the LIFO Out of Inventory

Explaining accounting to Congress is never easy. But last spring, Bill Jones, vice chairman of O’Neal Industries, says he witnessed a few “aha” moments as he went door-to-door on Capitol Hill to lobby against the elimination of “last-in, first-out” (LIFO) accounting.As Ron Travis, O’Neal’s vice p...

By Marie Leone • July 15, 2010

Major Accounting Changes: When Will They Hit?

When U.S. and international accounting standard-setters reprioritized their pending joint projects last month, they appeared to be backtracking on their self-imposed deadline to finish their convergence project by June 2011, a pledge they had recommitted themselves to as recently as last fall. Bu...

By Sarah Johnson • July 13, 2010