Fighting for Tax-deferred “Rights”

Since Eisenhower occupied the Oval Office, owners of business and income property have been able to exchange “like kind” real property and benefit from deferred tax treatment on gains. The Internal Revenue Service rules are relatively straightforward about what qualifies as like-kind property. Th...

By Robert Willens • Feb. 6, 2008

Black Ops Worries May Erase Qwest Charges

Pressured by the claim that its case could lead to a breach in national security, the Securities and Exchange Commission may back off on some of the charges it has levied against several former Qwest Communications executives. The regulator said it will consider altering its civil fraud charges a...

By Stephen Taub • Feb. 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

Auditor Road Show: “What Are You Thinking?”

Established one year ago, the Center for Audit Quality has become the official spokesperson and image booster for accounting firms. During its short life, the Washington, D.C.-based trade group has opined on regulatory proposals, conducted webcasts on issues facing the industry, and grabbed two s...

By Sarah Johnson • Feb. 5, 2008

Facing Up to Fair Value

The march toward fair-value accounting took another notable step in December when the Financial Accounting Standards Board revised FAS 141, its rule on business combinations. The new FAS 141(R) requires companies that acquire assets or assume liabilities in a deal to record the items at their acq...

By Marie Leone • Feb. 1, 2008

A New Vision for Accounting

Last summer, McCormick & Co. controller Ken Kelly sliced and diced his financial statements in ways he had never before imagined. For starters, he split the income statement for the $2.7 billion international spice-and-food company into the three categories of the cash-flow statement: operati...

By Alix Stuart • Feb. 1, 2008

Big Four Stems Exodus to Smaller Auditors

In a recent 8-K, Catapult Communications demonstrated that ditching a Big Four accounting firm for a smaller auditor can mean big cost savings. With a $102 million market cap, the telecom test equipment maker expects to save almost 50 percent on audit fees this year by moving from Deloitte & ...

By Alix Stuart • Jan. 31, 2008

Beware of the Stimulus Plan Boomerang

The proposed economic stimulus package, which is now in the hands of the Senate, has attracted a lot of attention because it will hand over money to many Americans. However, the final bill is likely to provide some goodies for corporations as well.For example, it is likely to provide most compani...

By Stephen Taub and Marie Leone • Jan. 31, 2008

The End of the Trail?

A federal judge harsh criticized the Interior Department for delays in its accounting for billions of dollars owed to Indian landholders, saying the massive project is pointless. “Indeed, it is now clear that completion of the required accounting is an impossible task,” said U.S. District Judg...

By Stephen Taub • Jan. 31, 2008

Big Time for Bayou Fund CFO

A former hedge fund CFO who used his accounting credentials to create phony audits of his failing fund was sentenced Tuesday to 20 years in prison.Daniel Marino of the Bayou hedge fund, which defrauded investors of more than $450 million pleaded guilty in September 2005 to conspiracy, investment ...

By Stephen Taub • Jan. 30, 2008

Pall Workers Feel Tax Ax

Pall Corp. has fired four employees it had placed on administrative leave after completing an inquiry into previously announced understatements of the company’s federal income tax payments and its provision for income taxes. These employees had principal responsibility for tax and treasury matt...

By Stephen Taub • Jan. 30, 2008

How to Nab the Rogues: 10 Fraud Tips

With recession looming larger with each passing day, fraud is ever more likely to rear its ugly head. Unlike the last recessionary period beginning in late 2001, today’s fraudsters are more likely to come from middle management than the C-suite. What happened to change things in the intervening ...

By David Katz • Jan. 30, 2008

Screw-up? True-up? Restatements Explained

In a development likely to calm investors and cheer some companies that have been forced to restate financial results, auditors signing off on corporate financial reports may now specify whether the company has restated its financial results because of an error, or whether it has done so simply b...

By Alan Rappeport • Jan. 29, 2008

When Does a ‘Protected Cell’ Fail the IRS Test?

This is the first in a series of regular tax columns by Robert Willens, founder and principle of Robert Willens LLC, a tax publishing and advisory service.When so-called protected cell companies (PCC) were first introduced to the global market in the late 1990s, they were viewed as an alternative...

By Robert Willens • Jan. 29, 2008

How to Ax Your Auditor

If there’s such a thing as a serial auditor switcher, Jack Henrie could be it.As CFO for a string of companies since 1990, and more recently in providing CEO and CFO support services as a outside consultant, he has been involved with no less than eight auditor replacements — a number “that’s clos...

By Roy Harris • Jan. 28, 2008

Six Years Later, Andersen Partners Settle Enron Charges

Almost six years after Arthur Andersen went out of business in the wake of the Enron collapse, the Securities and Exchange Commission has finally settled charges against four former partners of the accounting firm in connection with the audits of the energy company’s financial statements.David D...

By Stephen Taub • Jan. 28, 2008

Audit’s Cautious Watchdogs

J. Michael Cook, audit committee chair for a pair of giant companies, spent two mornings in a row last week going over the year-end close and financial release for one of them. First, he talked by phone with two audit-firm partners, then with the CFO.The call to the audit partners — “to make sure...

By Roy Harris • Jan. 28, 2008

“I Warned Parmalat CFO”: Ex-Auditor

A former employee of Parmalat’s auditing firm says he was aware of financial irregularities at the dairy giant long before it failed.Maurizio Bianchi, who had worked at Grant Thornton, says Parmalat had “an accounting hole” of 170 million euros six years before the Italian company collapsed in Eu...

By Stephen Taub • Jan. 25, 2008

The Big Lie

“Follow the money.” That was the mantra of Deep Throat, the mysterious source whom investigative reporters Bob Woodward and Carl Bernstein met in an underground parking garage in their real-life thriller, All the President’s Men.Cynthia Cooper, the internal auditor who unearthed the WorldCom acco...

By David Katz • Jan. 25, 2008

Who Needs the Big Four?

The promise of lower audit costs and better service is luring an increasing number of small and medium-sized companies away from the Big Four and into the arms of second-tier or regional accounting firms.From 2002 to 2006, in fact, the proportion of smallest public companies that used a Big Four ...

By Alix Stuart • Jan. 24, 2008

Top 10 Ways to Cut Your Audit Bill

Think there’s no way around sky-high audit costs? Think again. A recent study of 1000 companies by The Hackett Group found that the average company spends $584,000 per $1 billion of revenue on audit fees. The companies that earned the “world-class” designation, based on a variety of factors, howe...

By Alix Stuart • Jan. 24, 2008

Is Your Finance Job Recession-proof?

Sarbanes-Oxley. 404. IFRS. AS5. Proxy compensation disclosure. PCAOB. You might not have liked your job much recently, but if there was one silver lining to the years of post-Enron reforms and regulatory pressure, it was the near-guarantee of employment for anyone with accounting or finance skill...

By Tim Reason • Jan. 23, 2008

Clinton, Paulson, Rush for Stimulus

Declaring that “a global economic crisis…pushed the Fed” to call an emergency meeting on Monday and to cut rates on Tuesday morning, Democratic presidential candidate Sen. Hillary Clinton called for an economic stimulus package that would include increased federal spending, new housing regulation...

By David Katz • Jan. 22, 2008

New Pension Accounting: Volatility City?

Nothing is official yet. But the next phase of pension-accounting rulemaking is likely to affect the income statement. That means that the Financial Accounting Standards Board is considering changing the way companies report profits. If that happens, it’s sure to cause a stir.Under the current ru...

By Marie Leone • Jan. 21, 2008

How to Become a GAAP Geek

The Financial Accounting Standards Board has unveiled what it believes to be the official GAAP rulebook, pending verification by its constituents. Instead of an unwieldy, leather-bound document of tens of thousands of pages, the text is presented on a new website that can be searched and easily r...

By Sarah Johnson • Jan. 17, 2008

McCain Matches Giuliani on Tax-Cut Call

Republican presidential candidate John McCain on Thursday proposed a sharply lower tax rate and other tax breaks for business. His call to cut the the tax rate from 35 percent to 25 percent mirrors a plan floated last week by a rival candidate, Rudolph Giuliani.McCain characterized his plan as “...

By Stephen Taub • Jan. 17, 2008