Happier Returns

Supply chains are commonly thought of as moving in one direction: from manufacturer to vendor to customer. But goods flow the opposite way, too. Customers open boxes, don’t like what’s inside them, and return the items to the store, which then returns them to the manufacturer. Food products on gr...

By David Katz • Feb. 1, 2010

IRS: Show Us Where It Could Hurt

The Internal Revenue Service is proposing new regulations that would require companies to disclose significantly more information about uncertain tax positions than they are currently revealing in financial statements, including the maximum amount of potential tax liability the companies would ha...

By Marie Leone • Jan. 26, 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

Wells Fargo Is Chastised for SILO Deals

Wells Fargo & Co. claimed $115,174,203 in depreciation, interest, and transaction cost deductions for 2002. These deductions stemmed from the financial-services company’s participation in 26 “leveraged lease” transactions — specifically “sale-in lease-out” or SILO transactions.SILOs are set u...

By Robert Willens • Jan. 25, 2010

Fair Value: Eyes Wide Open

As promised by standard-setters, fair-value accounting rules are coming more into focus this year. On Thursday the Financial Accounting Standards Board released a reworked version of Subtopic 820-10 (formerly FAS 157), the controversial rule that dictates how companies should measure the fair val...

By Marie Leone • Jan. 22, 2010

Why Some Dividends May Change Their Stripes

Many real estate investment trusts (REITs), and certain regulated investment companies (RICs), as a way of conserving cash while satisfying their dividend-payment obligations, have resorted to declaring dividends that provide shareholders with an election to receive either cash or stock of equiva...

By Robert Willens • Jan. 19, 2010

Payments to Protect a Corporate Reputation

In general, payments made for the principal purpose of protecting an entity’s goodwill and reputation are deductible. That’s the case even if the payments also provide the taxpayer with long-term benefits that extend well beyond the close of the taxable year in which the expenditures are made.For...

By Robert Willens • Jan. 11, 2010

Fraud Case Feeds Sarbox-Exemption Critics

A finance executive’s alleged embezzlement of as much as $31 million over five years from headphone-maker Koss Corp. could serve as fodder for critics of legislation that would permanently exempt smaller publicly traded companies from fully complying with the Sarbanes-Oxley Act.Observers of the c...

By Sarah Johnson • Jan. 7, 2010

Best of 2009: Tax

It was a nice holiday surprise. Last November, at the behest of Congress, the Internal Revenue Service issued rules allowing companies to look back five years — before the financial crisis took hold — and offset taxable income from those “good” years with net operating losses from 2008 and 2009. ...

By CFO Editorial Staff • Jan. 6, 2010

New Clarity on Contingent Liabilities

The International Accounting Standards Board started off the new year by proposing new guidance on measuring contingent liabilities related to legal settlements and the retirement and decommissioning of factories and other major assets. The draft guidance is intended to replace what the IASB call...

By Marie Leone • Jan. 6, 2010

Presto! Weyerhaeuser’s a REIT

It has finally happened. In December Weyerhaeuser Co. announced that its board of directors “determined that conversion to a real estate investment trust (REIT) would best support the company’s strategic direction.” The most likely date for conversion of the forest products and real estate develo...

By Robert Willens • Jan. 4, 2010

CIT Moves to Protect Its NOLs

CIT Group Inc. has emerged from bankruptcy with its stock in the hands of its creditors and with its debt substantially diminished. The reduction of its debt has given rise to substantial amounts of cash on delivery income, which, because it was realized while CIT was under court jurisdiction in ...

By Robert Willens • Dec. 28, 2009

Best of 2009: Accounting

At this time next year we may be bidding a fond farewell to U.S. generally accepted accounting principles — or we may not. Regulators are still undecided about whether to require U.S. companies to abandon U.S. GAAP in favor of international financial reporting standards. But advocates and opponen...

By CFO Editorial Staff • Dec. 24, 2009

A Separate GAAP?

Should privately held companies have their own set of accounting rules? Many finance managers would no doubt say yes, particularly those at small private businesses that have to contend with rules designed for much larger and more complex organizations.Entering the debate will be a blue-ribbon pa...

By Sarah Johnson • Dec. 23, 2009

Veritas Scores a Major Transfer-Pricing Victory

In a case decided on December 10, Veritas Software Corp. won a big victory over the Internal Revenue Service when the tax court upheld its transfer-pricing calculation.Veritas Software, which is in the business of developing, manufacturing, marketing, and selling software products, went through s...

By Robert Willens • Dec. 21, 2009

Ex-Bally CFO and E&Y Auditors Charged by SEC

Auditors at Ernst & Young wound up in the crosshairs of the Securities and Exchange Commission on Thursday, when six of the firm’s current and former partners were charged by the regulator for the part they played in an accounting-fraud scheme related to Bally Total Fitness Holding Corp. Thre...

By Alix Stuart and Marie Leone • Dec. 21, 2009

Hunting Tax Dodgers, Hitting Banks

The so-called tax extenders bill passed last week by the House of Representatives is largely a gift to business, renewing a raft of tax breaks that otherwise would have expired at the end of the year. But one provision of the bill could ultimately make it harder for some companies to obtain credi...

By Marie Leone • Dec. 18, 2009

“Cross-Border” Spin-offs Can Be Tax-Free

In a private letter ruling issued by the Internal Revenue Service earlier this year, the agency provided guidance on when a spin-off of a foreign subsidiary by an American company can be considered a tax-free transaction. The letter’s guidance took the form of a hypothetical situation involving a...

By Robert Willens • Dec. 14, 2009

Harvey Goldschmid Named IASB Trustee

The independence of an organization depends in large part on its source of funding. That’s why Columbia University law professor Harvey Goldschmid thinks it’s a good idea for the International Accounting Standards Board to rework its funding mechanism, following the example of the Financial Acco...

By Marie Leone • Dec. 11, 2009

SEC: No IFRS Yet

The Securities and Exchange Commission’s chief accountant said Monday that participants in the U.S. capital markets will “hear more from” the regulator about international financial reporting standards “in the near term.” That likely means it will be early next year when the SEC will decide as pr...

By Marie Leone • Dec. 9, 2009

Herz: Give Banks More Freedom from GAAP

Robert Herz, chairman of the Financial Accounting Standards Board, wants to loosen the ties between accounting standards and banks’ capital thresholds.At the American Institute of Certified Public Accountants’s annual meeting Tuesday, Herz called for a “greater decoupling of bank regulation from ...

By Sarah Johnson • Dec. 8, 2009

Fair-Value Auditing: Not Just for Auditors

Over the past year and a half, the Securities and Exchange Commission has fielded a slew of questions from companies about the fair-value measurement of financial assets and liabilities. Many requests for guidance have involved auditing the assumptions and estimates used to determine fair value. ...

By Marie Leone • Dec. 8, 2009

E*Trade’s Debt Swap Triggers Ownership Change

E*Trade Financial Corp. disclosed on November 4 that during the third quarter it exchanged about $1.76 billion in principal amount of “interest-bearing debt” for an equal principal amount of noninterest-bearing convertible debentures.Subsequent to the completion of this exchange offer, some $592 ...

By Robert Willens • Dec. 7, 2009

House’s New Financial Reports Drop Details

Claiming a milestone in Congressional transparency, the House on Monday for the first time released its quarterly expense reports online. But first, Congressional administrators erased a vast array of details on the expenditures of House Members, making it impossible to determine what much of the...

By Roll Call Staff • Dec. 4, 2009

A Tax Gift for the Holidays

As the end of 2009 approaches, companies with operating losses from the past two years have a big decision to make: whether to take advantage of the new net operating loss (NOL) carryback rules that were signed into law in November. To put more cash into the coffers of American businesses, Congre...

By Marie Leone • Dec. 1, 2009

Accounting Alchemy Earns Lessee a Capital Deduction

In a case that demonstrated that hotel lease agreements had “economic substance and were not shams designed merely to reduce taxes,” a Sheraton partnership company battled the Internal Revenue Service and won. Heard before the U.S. Tax Court in May, the case involved a partnership that operates t...

By Robert Willens • Nov. 30, 2009