Study: Many Big Companies Omit Tax Disclosure

Over 25 percent of 601 companies with revenues of more than $2 billion aren’t meeting the disclosure requirements for tax reserves required by the Financial Accounting Standards Board rule number 48, according to a study released Monday.Nearly 72 companies–all of which filed 10-Ks in the first qu...

By David Katz • July 21, 2008

Will InBev Imbibe a Large U.S. Tax Break?

Tucked away in the various reports about the acquisition of the St. Louis-based Anheuser-Busch Companies by Belgium’s InBev NV, is an interesting tax-related issue. In the Wall Street Journal’s regular “Breaking Views” column, the author reckons that the debt that InBev would need to incur to acq...

By Robert Willens • July 21, 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

PwC Sees Stock-option Impact from IFRS Shift

Differences in the tax-benefit information that International Financial Reporting Standards require in the case of employee stock options could be challenging for companies, according to a new report from PricewaterhouseCoopers.In a white paper authored by a U.S. PwC partner and a director in the...

By Roy Harris • July 21, 2008

Revenue-Recognition Rules: From the Many, One?

E pluribus unum is the rally cry behind the newest push by the Financial Accounting Standards Board to rewrite revenue recognition rules and guidance. At Wednesday’s board meeting, the five-member panel decided to publish a discussion paper that will cover key concepts regarding revenue recogniti...

By Marie Leone • July 17, 2008

Stall Balance-sheet Changes, FASB Asked

Declaring that forcing companies to abruptly consolidate the results of special-purpose entities (SPEs) would likely “swell the balance sheets” of the affected companies with losses and shatter loan covenants, two securities trade groups are asking the Financial Accounting Standards Board to put ...

By David Katz • July 17, 2008

One Step Forward on Pension Disclosures

Pension investment disclosures in financial statements will become more “granular” in the future, though it’s not yet clear what additional information will be required or what format will be mandated.The Financial Accounting Standards Board met on Wednesday to discuss its project on post-retirem...

By Marie Leone • July 16, 2008

Global Audit Board Rules on Related Parties

The International Auditing and Assurance Board has released a new standard that clarifies how auditors should treat “related parties,” which unscrupulous companies — Enron, for example — have used to distort earnings or cloak items from financial statements.The new rule is part of the board’s ong...

By Alan Rappeport • July 16, 2008

Priceless? Is MasterCard’s Settlement Deductible?

After a four-year court battle, MasterCard Inc. announced on June 25, that it had reached an agreement to settle its outstanding litigation with American Express. The lawsuit, filed in federal court in 2004, alleged that MasterCard, Visa, and some of their member banks blocked Amex from the bank-...

By Robert Willens • July 15, 2008

Don’t Mess with the IRS

April, always the cruelest month for taxpayers, became more so this year when the Internal Revenue Service racked up yet another victory against a corporate tax shelter. At issue was a decade-old transaction between a U.S.-based financial holding company, BB&T Corp., and a Swedish wood-pulp m...

By Alix Stuart • July 15, 2008

Materiality Debate Emerges from the Dark

The Securities and Exchange Commission has been very careful about defining what is — and what is not — “material” information for investors. Mainly, it has wanted to avoid setting bright-line rules that companies can finagle around. But while a strict financial-statement materiality definition m...

By Marie Leone • July 14, 2008

Closing Time

The sub-prime crisis’ expected drag on close cycles failed to emerge, according to latest figures from Paragon Consulting and BPM International. (See companion article.)In the financial services sector, a handful of larger European banks—including BNP Paribas, Société Générale, Deutsche Bank and ...

By Eila Rana • July 14, 2008

Putting Standard-Setters to the Test

The effort by the Financial Accounting Standards Board to cut complexity out of the standard-setting process might be thrust into high gear come August. That’s when a Securities and Exchange Commission advisory committee will issue its recommendations for improving the financial-reporting system ...

By Marie Leone • July 11, 2008

Is There an “Elevator Speech” in Your 10-K’s Future?

The Securities and Exchange Commission’s advisory Committee on Improvements to Financial Reporting (CIFR) voted unanimously on Friday to move forward with its proposal to require a new “executive summary” in annual and quarterly reports filed with the SEC.As proposed, the executive summary would ...

By Vincent Ryan and Alan Rappeport • July 11, 2008

Mark-to-market’s Liability Lag

The scramble to implement fair value accounting rules has launched a thousand companies in as many directions, subjecting assets and liabilities to market valuations whether or not markets exist. The ramifications resemble guideposts to some observers, futile and dangerous exercises to others. Bu...

By S.L. Mintz • July 10, 2008

Bernanke, Paulson Champion Global Accounting

Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke both defended the Securities and Exchange Commission’s plans for converging American accounting standards with international bookkeeping rules.Their comments on Thursday came in response to criticism over the rapid progres...

By Alan Rappeport • July 10, 2008

You’ll Need a Fair Value “Mindset”

It will take more than a change in rules to make companies comfortable with the move to fair value accounting. It will take a change in “mindset,” predicts Gary Kabureck, the chief accountant and corporate vice president at Xerox Corp.Kabureck was one of eight experts invited by the Securities an...

By Marie Leone • July 10, 2008

A Little Fair Value Never Killed Anyone

Fair value accounting received a baptism by fire when it was rolled out at the beginning of the credit crisis. And it bedeviled financial institutions that had to find prices for securities no one would buy. But fair value remains the type of financial information investors find most useful, conc...

By Tim Reason • July 9, 2008

How Fair Value Rewards Deadbeats

Panelists of a Securities and Exchange Commission roundtable on fair-value financial reporting on Wednesday clashed over an accounting provision under which a company can boost its reported earnings by becoming less creditworthy.In the provision, paragraph 15 of standard number 157, the Financial...

By Tim Reason and David Katz • July 9, 2008

New Accounting Guidance for Earnings-per-share

The staff of the Financial Accounting Standards Board (FASB) has, it seems, increased the rate at which accounting guidance is being issued. The latest offering involves a clarification of the manner in which earnings per share (EPS) is calculated for entities which have issued “participating sec...

By Robert Willens • July 8, 2008

Dash for Cash

Karlheinz Hornung takes nothing for granted. He joined a subsidiary of German conglomerate Metallgesellschaft in the late 1970s, shortly before the group’s 100th anniversary, and worked his way through the ranks. Then, in 1993, he was despatched to the company’s head office in Frankfurt to help s...

By Jason Karaian • July 8, 2008

PwC Sees Revenue Recognition Snags in IFRS

Some American companies see the shift to International Financial Reporting Standards as relatively harmless, figuring that they’re safe because they’ve been weaned on the stricter requirements of U.S. generally accepted accounting principles. But in some areas — especially among software companie...

By Roy Harris • July 8, 2008

A Fair Value Pep Rally?

In two days time, the Securities and Exchange Commission will host a roundtable on fair value accounting and auditing standards — that is, the increasingly mandatory practices of valuing the assets and liabilities of companies, and ultimately companies themselves, by their current worth in the ma...

By Tim Reason and David Katz • July 7, 2008

Working Capital Scorecard 2008

Read the complete results of the 2008 working capital survey, or review just those results that appeared in print.When it comes to working capital management, 2007 was not a vintage year. For Europe’s largest companies, days working capital (DWC) rose to 47.3 last year (excluding carmakers), an i...

By Jason Karaian • July 7, 2008

Fasten Your Seatbelts

“I’m not blaming any meltdown in systems. This was more simple,” Rod Kent, chairman of Bradford & Bingley, told reporters in early June. He had the grim task of announcing that the UK’s largest buy-to-let bank had been hit hard by the subprime crisis and needed to raise more than the £300m (€...

By Eila Rana • July 7, 2008

Taxation and Representation

For the first time since 1775, American taxes soon may be determined by people far away in London, England. But don’t break out your squirrel guns and start dumping tea just yet — we’re only talking about accounting.In an effort to speed the convergence of American and international accounting, r...

By Tim Reason • July 3, 2008