Hilfiger Unit Ex-CFO Pleads Guilty to $19m Fraud

The former finance chief of a Tommy Hilfiger Group licensee pleaded guilty to mail fraud and wire fraud for allegedly stealing more than $19 million, according to Michael Garcia, U.S. attorney for the Southern District of New York.Martin Bodner, the former finance chief of Tommy Hilfiger Handbags...

By Stephen Taub • Sept. 16, 2008

Revenue Recognition Trips Up Auditors, Clients

As U.S. and international accounting standard setters work to fix, and then converge, rules related to revenue recognition, preparers and auditors still struggle with proper real-world application of the regs. Indeed, during a meeting held in New York last week, a top official at the Public Compa...

By Marie Leone • Sept. 16, 2008

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

Provident Bankshares Dumps KPMG for Deloitte

Provident Bankshares fired KPMG as its independent accountant, replacing it with Deloitte & Touche, after a dispute related to treatment of “other-than-temporary impairment of investment securities.”The parent company of Provident Bank said that KPMG’s audit reports for the two most recent y...

By Stephen Taub • Sept. 15, 2008

UK Group Warns of Global-accounting Confusion

The UK-based Association of Investment Companies (AIC) said that new global accounting standards should pay more attention to core investor concerns or risk confusing the accounting community with unnecessary information.“The investor viewpoint should be placed at the heart of the standards setti...

By Stephen Taub • Sept. 15, 2008

What’s Your ARS Worth?

Could there possibly be a stranger financial reporting conundrum than auction-rate securities? A year ago, they were simple: Most companies recorded auction-rate securities as cash equivalents on their balance sheets. End of story. Today, the same securities are still AAA-rated and financially-so...

By Tim Reason • Sept. 12, 2008

Vive le GAAP

Advocates of moving the United States toward international accounting standards say the switchover from GAAP let investors more easily compare U.S. and international companies and put all companies worldwide on a level laying field. Plus, they claim, the elimination of GAAP will put an end to acc...

By Sarah Johnson • Sept. 11, 2008

FASB, IASB Eye 2011 as Wrap-up Date

The Financial Accounting Standards Board and the International Accounting Standards Board, makers of U.S. and international accounting rules, on Thursday released an updated memorandum of understanding that strives for all major joint projects to be completed by 2011. The update of the 2006 docu...

By Alan Rappeport • Sept. 11, 2008

Court Upholds $183 Million Judgment Against PwC

A federal appeals court has upheld a $183 million judgment against PricewaterhouseCoopers stemming from a 20-year auditing malpractice suit brought against Coopers & Lybrand, a predecessor company.In July 2005, a federal jury found that Coopers & Lybrand was negligent in its audit of Amba...

By Stephen Taub • Sept. 11, 2008

Regulator Rips Into Global Accounting Plan

Recent efforts to move the United States toward adoption of international accounting standards is a politically motivated effort that will hurt the standing of the United States in the world’s capital markets, a prominent accounting regulator said today.A precipitous move away from U.S. Generally...

By Marie Leone • Sept. 10, 2008

The Tax Burden Seesaw

Large multinational companies’ tax practices will fall under Congress’s scrutiny next year as the heads of the Senate Finance Committee pledge to “tackle tax reform in 2009” following a report that businesses are increasingly shifting their operations — and their taxable income — outside the Unit...

By Sarah Johnson • Sept. 9, 2008

Thor Hammers Home Tax Lessons for a Recession

Over the course of a recession, corporate inventories tend to accumulate, particularly at companies that were unsuccessful in accurately forecasting the (depressed) level of demand for their products. Accordingly, under generally accepted accounting principles (GAAP) — which normally requires the...

By Robert Willens • Sept. 9, 2008

First Auditor Change, Now Wells Notice for CFO

Mannatech Inc., a provider of dietary supplements, said the Securities and Exchange Commission may take action against the company, its chief financial officer, and the chairman of its audit committee. At issue, is the timing and completeness of Mannatech’s October 2007 disclosure regarding its d...

By Stephen Taub • Sept. 8, 2008

United Rentals Settles Sale-Leaseback Fraud Charges with SEC

United Rentals, a large equipment-rental company, has reached an agreement with the Securities and Exchange Commission to pay $14 million to settle civil financial fraud charges stemming from the improper use of sale-leaseback transactions and a broad range of other improper accounting practices....

By David Katz and Stephen Taub • Sept. 8, 2008

Fannie, Freddie Get Tax Pass, Too

Wouldn’t it be nice if the Internal Revenue Service issued a new tax rule that applied just to your company to help it retain all the net-operating losses it could? In that way, the NOLs could be used over the next 20 years to offset income, and reduce the company’s tax bill.That’s what Treasury ...

By Marie Leone • Sept. 8, 2008

Will GE Hedge Accounting Pass Muster?

General Electric said it faces possible civil action by the Securities and Exchange Commission stemming from an investigation into its use of hedge accounting for derivatives. The conglomerate said in a regulatory filing released on Friday that the SEC staff issued a “Wells notice” recommending t...

By Stephen Taub • Sept. 8, 2008

Why CFOs Still Don’t Like Hedge Accounting

It seems logical to assume that finance chiefs would want to take advantage of a new accounting rule that suppresses earnings volatility. But results from a forthcoming study find that when it comes to accounting for hedging activity, some CFOs would rather risk volatility than designate derivati...

By Marie Leone • Sept. 5, 2008

Accounting-Rule Change Spurs Lawsuit

A shareholder is suing five banks, claiming they did not warn her or other investors about a proposed accounting-rule change that lowered the value of Fannie Mae stocks she bought, Bloomberg News reported.The proposed rule is FAS 140, the accounting standard that specifies the conditions for keep...

By Marie Leone • Sept. 5, 2008

Education Lags Behind IFRS Momentum

The first crop of U.S. accounting students trained in the ways of international financial reporting standards won’t arrive until the Class of 2011, according to a new survey of professors. The Securities and Exchange Commission’s move to allow — and eventually mandate — U.S. companies to use IFRS...

By Sarah Johnson • Sept. 4, 2008

UK Co. Finds Errors, Fires a Finance Director

Hamworthy, a UK-based maker of equipment for the energy and marine industries, fired a division finance director after discovering accounting errors.The maker of gas handling, pumping, and water management systems for the merchant marine, cruise, and oil and gas sectors, said an internal review a...

By Stephen Taub • Sept. 3, 2008

Not What You Bargained For: Equity Forward Contracts

Many companies have chosen to repurchase their shares by means of “equity forward” contracts, but some confusion remains regarding how the Internal Revenue Service views these transactions. In April, the IRS tried to clear things up with guidance laid out in a chief counsel advisory letter (CCA 2...

By Robert Willens • Sept. 2, 2008

Fair-Value Revolution

What is a company really worth? That is the central question that accounting attempts to answer, and it is no easy exercise. Every answer invites debate, and that debate has now intensified, thanks to “fair value” accounting.Under fair value, a company values its assets and liabilities based on w...

By David Katz • Sept. 1, 2008

No Time to Lose: The 2008 Working Capital Scorecard

Read the complete results of the 2008 working capital survey, or review just those results that appeared in print.Beware your survival instincts: they may dampen corporate performance more than you might expect. With a recession looming or quite possibly upon us, it can be tempting to ease up on ...

By Randy Myers • Sept. 1, 2008

Digging In

Overwhelmed by rising costs, many companies are realizing that profits don’t come easy these days. That’s true even when you’re sitting on a gold mine. Despite the massive run-up in gold prices (160 percent since August 2003), Kinross Gold Corp. has taken a pickax to a host of supply-chain costs,...

By Randy Myers • Sept. 1, 2008

Tax Risk Markers Along the IFRS Roadmap

If you’ve ever complained about the complexity of corporate tax rules – wait – things are about to get more complicated. As part of a worldwide movement to standardize accounting rules, the U.S. Securities and Exchange Commission announced on Wednesday that it would be testing the waters with reg...

By Marie Leone • Aug. 29, 2008

Caution: International Accounting Ahead

In announcing the Securities and Exchange Commission’s roadmap for a U.S. conversion to IFRS on Wednesday, chairman Christopher Cox described the proposal as a “cautious and careful plan.”To date, no one has officially commented on the proposal — indeed, the SEC had yet to formally post it as Was...

By Tim Reason • Aug. 29, 2008