Report: IRS Has Faulty Internal Controls

Since its first audit of the Internal Revenue Service in 1992, the Government Accountability Office has stressed that the IRS has serious internal control weaknesses, and the GAO’s latest audit of the service was no exception. The IRS’s internal controls are deficient, hindering how its managers...

By Sarah Johnson • Nov. 14, 2006

SAB 108: Material Whirl

The Securities and Exchange Commission has issued guidance on how to correct errors that have built up on the books over time. In the past, companies dealt with such errors — those that are too small to fix in any given time period but cumulatively can have a material effect on the balance sheet ...

By Ronald Fink • Nov. 10, 2006

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

Accountants: Going Once, Going Twice

What if companies could bid for temporary accounting help on the Web as easily as Bruce Springsteen fans chase concert tickets on eBay? Now they can.Slated to launch this month, GreenBrim.com provides an auction service for companies looking for temporary finance and IT help. “Usually companies c...

By Laura DeMars • Nov. 10, 2006

Fannie’s Restatement Tab: $1 Billion

Fannie Mae will spend more than $1 billion this year to prepare its massive restatements covering the past few years. In a regulatory filing, the nation’s biggest mortgage lender stated that for all of 2006, its restatement and related regulatory costs will amount to roughly $850 million.Further,...

By Stephen Taub • Nov. 9, 2006

Merck Says It May Owe $5.58b in Taxes

Merck & Co. said it faces as much as $5.58 billion in tax liabilities from the U.S. and Canada stemming from four disputes. The drug giant noted in a regulatory filing that it disagrees with the proposed adjustments and intends to pursue these matters through applicable Internal Revenue Servi...

By Stephen Taub • Nov. 8, 2006

American Tower Finds Option Flaws

American Tower reported that former senior managers were responsible for a policy of reporting option grant dates that differed from the dates on which the grants were legally effective.The operator of wireless and broadcast communications sites said a special committee probing its past options p...

By Stephen Taub • Nov. 8, 2006

Big Four Eyes End to Quarterlies: Report

The Big Four accounting firms will call on Wednesday for sweeping changes in the way companies report their results to investors, including an end to quarterlies, according to the Financial Times.In the place of “static” quarterly statements, PwC, Deloitte, KPMG, Ernst & Young, plan to re...

By David Katz and Stephen Taub • Nov. 7, 2006

What the Midterms Mean to Tax Managers

If you are a corporate tax professional, duck! You could easily get caught in the crossfire of election-day mudslinging, as candidates and their parties square off about tax reform.As the political rhetoric moves from election day into election night, Republicans will continue to insist that they...

By Marie Leone • Nov. 7, 2006

Uncertainty Reigns Over Taxes

This summer, the Financial Accounting Standards Board issued what it hoped would be clear guidelines for recognizing and measuring uncertainty in income taxes. Instead, a new survey says, the guidance has finance executives feeling, well, uncertain.Companies, of course, have always been in the aw...

By Helen Shaw • Nov. 7, 2006

Fast Forward: TDS, U.S. Cellular Restate

Telephone and Data Systems and its United States Cellular subsidiary each announced that they will restate financial results for 2002 through 2005, including quarterly information for 2004 and 2005 and the first and second quarters of 2006. The main reason: to correct the accounting for a number ...

By Stephen Taub • Nov. 7, 2006

Bisys Settles More Charges With SEC

The Bisys Group said it agreed to pay $25.1 million to settle a Securities and Exchange Commission investigation into previous restatements. The provider of outsourcing services to the financial services sector said that under the agreement, it would refrain from future violations of the reportin...

By Stephen Taub • Nov. 6, 2006

Two More Former McKesson Execs Acquitted

For the third time in one week, a celebrated accounting scandal from the 1990s was resolved. But this time, none of the former executives were convicted of the charges or pleaded guilty as part of a settlement.Two former executives of McKesson Corp.—one-time Chief Executive Officer and Chairman C...

By Stephen Taub • Nov. 6, 2006

A Guilty Plea in a “Cookie Jar” Case

In a resolution of a major 1990s case, John Brincat, the one-time chief executive officer of Mercury Finance Co., pleaded guilty to wire fraud and lying to a bank, according to the Associated Press.Brincat reportedly admitted to overstating the sub-prime lender’s earnings and delaying the reporti...

By Stephen Taub • Nov. 2, 2006

Former Spiegel Heads Settle SEC Charges

Eight former officers and directors of Spiegel, Inc.—including an ex-CFO and a treasurer—settled fraud charges leveled against them by the Securities and Exchange Commission. Five previous executives of the catalogue retailer settled charges of overstating the performance of Spiegel’s credit card...

By Stephen Taub • Nov. 2, 2006

Ex-CA Chief Sanjay Kumar Gets 12 Years

Sanjay Kumar, the former chief executive officer of CA Inc., was sentenced to 12 years in prison and fined $8 million for his role in the software company’s $2.2 billion accounting fraud, Bloomberg reported.In April, Kumar had pled guilty to eight charges, including conspiracy, fraud, and obstruc...

By Stephen Taub • Nov. 2, 2006

Survey: Sarbox 404 Burdens Tax Execs

Senior corporate tax executives report a disconnect between the tasks they expect to spend time on and those they feel would deliver the most value to their companies, according to a new survey of tax departments.Majorities of the 203 senior tax executives at U.S. companies responding to KPMG’s 2...

By Stephen Taub • Nov. 2, 2006

Finance Execs Join PCAOB Advisory Group

The finance executives new to the standards group for the overseer of auditors are looking forward to representing their point of view to the fledgling board next year.The Public Company Accounting Oversight Board announced last week who will serve 2007-2008 tenures on its Standing Advisory Group...

By Sarah Johnson • Nov. 1, 2006

Ex-Cendant Chairman Found Guilty

Three is certainly not a charm for former Cendant Chairman Walter Forbes. In his third trial, Forbes was found guilty by a federal jury for his role in a massive accounting scandal that was deemed to be the largest corporate fraud in the pre-Enron era, according to published reports.He was found ...

By Stephen Taub • Nov. 1, 2006

Ex-McAfee Finance Exec Settles With SEC

A former finance executive of McAfee Inc. agreed to pay nearly $750,000 to settle civil fraud charges with the Securities and Exchange Commission. Eric G. Borrmann, who held a variety of financial positions, including treasurer for McAfee, was accused of engaging in a multimillion dollar financia...

By Stephen Taub • Oct. 31, 2006

SEC Charges 8 Ex-Delphi Finance Execs

The Securities and Exchange Commission charged 13 individuals, including eight former finance executives, for the roles they played in a massive fraud at Delphi Corp. In addition, the regulator settled financial fraud charges against the auto parts giant covering the years 2000 through 2004. Unde...

By Stephen Taub • Oct. 30, 2006

Former CFO Settles with SEC

The former chief financial officer of a health-care provider has settled civil charges with the Securities and Exchange Commission for allegedly causing his onetime employer to file materially false financial statements. Thomas P. Clark of Health Risk Management (HRM) agreed to pay a civil penalt...

By Stephen Taub • Oct. 27, 2006

PCAOB Reveals What’s Next for AS2

Possible amendments to the Public Company Accounting Oversight Board’s Auditing Standard No. 2 include rethinking the auditor’s role in assessing management, improved term definitions, and an emphasis on a top-down, risk-based audit approach, revealed Thomas Ray, chief auditor and director of pro...

By Helen Shaw • Oct. 27, 2006

Companies Fire Back at Backdating Report

Confronted with errors and criticized for unfairly implicating executives and companies in the stock-options scandal, officials at The Corporate Library are standing behind the firm’s recently issued report, “The Spread of Backdating: A Closer Look at the Boards and Directors Involved,” which pur...

By Sarah Johnson • Oct. 27, 2006

OSI May Restate Results Over Gift Cards

OSI Restaurant Partners said it may restate its results for certain periods because it understated its liability for unearned revenue for unredeemed gift cards and certificates. The company, which operates Outback Steakhouses, estimates the potential liability at between $20 million and $40 milli...

By Stephen Taub • Oct. 26, 2006

FASB To Change Derivative Accounting

The Financial Accounting Standards Board voted on Wednesday to push ahead a proposed change aimed at easing the volatility in the income statements of asset-backed and mortgage-backed securities investors—such as community banks and insurance companies.The proposal would affect FASB Statement No....

By Helen Shaw • Oct. 25, 2006