It’s Your Loss. (Maybe.) Now Explain It.

The Financial Accounting Standards Board has proposed substantially increasing the amount of information that companies are required to provide to investors about potential future losses. The new rule could have a dramatic impact on how companies disclose potential liabilities in their financial ...

By Tim Reason • June 9, 2008

PwC Rivets Attention on IFRS Tax Issues

PricewaterhouseCoopers cautioned in a new report that serious tax issues stemming from a shift to international financial reporting standards make it vital for corporate tax executives to “be part of the IFRS conversion process at a very early stage.”Titled “IFRS: The Right Move toward Convergenc...

By Roy Harris • June 5, 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

New FEI Group to Chime In on International Standards

Seeking to give a voice to corporate executives in the drive toward reporting convergence, Financial Executives International created a group to study related issues and make recommendations as the replacement of generally accepted accounting principles draws closer.FEI designated the new body t...

By Roy Harris • June 5, 2008

Ex-Senate Banking Committee Aide Picked for PCAOB

Former Senate Banking Committee staffer Steven B. Harris was named to the Public Company Accounting Oversight Board. Harris had helped draft the Sarbanes-Oxley Act that created the auditing industry watchdog board in 2002. Securities and Exchange Commission chairman Christopher Cox made the anno...

By Kate Plourd • June 4, 2008

Restatements Plunge after Record 2006

After a decade long run-up, the number of financial restatements filed by companies to correct accounting errors fell sharply last year, according to a new study from Glass, Lewis & Co. The 17 percent decline, to 1,270 restatements, followed a record high of 1,523 financial revisions in 2006...

By Stephen Taub • June 3, 2008

Tangled Up at Big Blue: IBM Settles Expensing Suit

International Business Machines agreed to pay $20 million to settle a securities class action lawsuit claiming that the computer company misrepresented its plans to begin stock option expensing, according to a joint announcement from two law firms and IBM.The settlement is subject to final court...

By Stephen Taub • June 3, 2008

FedEx Removes the “Kinko’s” with a Write-off

FedEx Corp.’s decision to dispense with the Kinko’s brand — changing store names to FedEx Office — involved the company taking a $515-million noncash impairment charge for the acquired trade name, and $367 million for goodwill.In its 8-k filing with the Securities and Exchange Commission, the doc...

By Stephen Taub • June 3, 2008

All Sides Warm to IFRS as Global Standard

Christopher Cox’s comments last week about the need for a “public policy oversight body” to watch over the International Accounting Standards Board are in sync with what the board’s trustees already have in mind.The remarks by the Securities and Exchange Commission chairman, in an interview with ...

By Alan Rappeport • June 3, 2008

Kill the Q: Subprimes Head for Balance Sheets

(CORRECTION: This is a corrected version of a story that inaccurately reported that the Financial Accounting Standards Board was likely to consider the elimination of Qualified Special Purpose Entities. In fact, the board decided to remove the concept of QSPEs from FASB Interpretation No. 46 at i...

By David Katz • June 2, 2008

Convertible Bond Rule Targets Earnings

The Financial Accounting Standards Board (FASB) has finalized its “guidance” with respect to accounting for some immensely popular convertible instruments known as “Instrument C.” The problem, however, is that the news, as everyone suspected, is decidedly negative.*Many of the accounting advantag...

By Robert Willens • June 2, 2008

Chemical Reaction: Oil’s Ripple Effect

As surging oil prices causing companies in a variety of industries to raise prices — often substantially — inflation fears are starting to feel a lot like those of the 1970s.Perhaps the most aggressive price hikers recently have been chemical companies, those large users of energy products. But n...

By Stephen Taub • June 2, 2008

Investors Smack Banks for Fair-Value Attack

Are bankers covering up their own blunders by blaming their mishaps on fair-value accounting? One investor group — an offshoot of the Financial Accounting Standards Board — thinks so, and has published a letter to get the word out.When financial institutions argue against mark-to-market financial...

By Marie Leone • May 30, 2008

Indirect Taxes May Surge Globally

Multinational corporations are preparing for a surge in indirect taxes from governments, according to a global survey of senior finance executives.With corporate tax rates generally declining around the world, three quarters of major global businesses believe that governments will rely more on in...

By Stephen Taub • May 29, 2008

I Report, Therefore I Am?

The Financial Accounting Standards Board and the International Accounting Standards Board are going back to basics: seeking public comment about what is meant by “faithful representation,” and what a “reporting entity” is.FASB and IASB described what they are doing as part of an effort at devisin...

By Roy Harris • May 29, 2008

Cablevision Goes “Sundancing”

On May 7, 2008, Rainbow Media Holdings LLC, a programming subsidiary of Cablevision Systems Corp., announced that it had reached an agreement to acquire the Sundance Channel from General Electric Co.’s NBC Universal, CBS Corp.’s Showtime Networks, and entities controlled by none other than Robert...

By Robert Willens • May 27, 2008

High Court: Taxing Out-of-State Muni Bonds Is OK

Municipal bonds have been making headlines lately, moving from the muni bond scandal in San Diego to the Securities and Exchange Commission’s investigation into JPMorgan’s bidding practices to Moody’s announcement that it plans to rate the bonds on the same scale as corporate debt. Now the Supre...

By Robert Willens • May 23, 2008

Army in Iraq Is No Paymaster

A new audit report from the Inspector General of the Department of Defense estimates that $1.4 billion out of a total of $10.7 billion in payments made by the U.S. Army in Iraq, Kuwait, and Egypt between 2001 and 2006 lacked the “minimum supporting documentation” to assure they were used as inten...

By Tim Reason • May 23, 2008

Cash-Poor Airlines Down, Almost Out

Over the years, the airline business has rarely proved to be highly profitable — even when oil wasn’t going for $125 a barrel.Joining a long list of competitors, Mesa Air Group and Silverjet both say they are in a cash crunch that could have major impacts on their operations.In a regulatory filin...

By Stephen Taub • May 23, 2008

Big Four Make Big Plans for IFRS

The competition is heating up in the latest Big Four contest: over who will do the most to help the educational system, and corporate clients, prepare for international financial reporting standards.Deloitte & Touche, Ernst & Young, PricewaterhouseCoopers, and KPMG all claim supremacy in ...

By Roy Harris • May 22, 2008

SEC Probing Wind Turbine Company

The Securities and Exchange Commission is investigating Zoltek Companies, an alternative energy company lacking a permanent CFO that disclosed problems with its financial reports earlier this month. Zoltek, a supplier of carbon fibers used in wind turbine blades and other equipment, said in a Tue...

By Stephen Taub • May 22, 2008

Acxiom’s Restatement Covers Four Years

Acxiom Corp. disclosed details of its previously announced plans to restate financials to correct errors in the company’s accounting for accrued revenue. The provider of customer and information management products said it is reducing earnings by $7.95 million over the past four fiscal years.It a...

By Roy Harris and Stephen Taub • May 21, 2008

Why Sprint Can Spin Nextel Off, Tax-Free

Sprint Corp. is evaluating its options concerning Nextel Communications, its wholly-owned subsidiary. Apparently, one of those options is a spin-off of Nextel’s stock to Sprint’s shareholders. Can such a spin-off be accomplished on a tax-free basis?Although it’s far from clear, such a tax-free sp...

By Robert Willens • May 20, 2008

AICPA Warms to International Standards

The governing council of the American Institute of Certified Public Accountants voted to amend its rules to give AICPA members the option of using International Financial Reporting Standards as an alternative to U.S. generally accepted accounting principles. The amendment to Appendix A of AICPA R...

By Stephen Taub • May 20, 2008

Study: R&D Rule Threatens Future Earnings

Starting next year, companies that acquire incomplete research-and-development projects in a merger will have to capitalize — and eventually amortize — the assets, rather than follow the current practice of expensing the items.The change, mandated by the newly-revised FAS No. 141(r), Business Com...

By Marie Leone • May 20, 2008

Bank Job at Troubled Franklin Goes to Ranieri

Franklin Bank Corp. said that an internal review determined that Franklin had engaged in improper accounting in a number of mortgage-lending areas. It also put board chairman Lewis S. Ranieri in the additional role of interim CEO.The Houston-based concern also said that the Securities and Exchang...

By Stephen Taub and Roy Harris • May 20, 2008