Audit & Accounting

New guidance stressing efficient application of effective internal controls over financial reporting was released in mid-July by the Committee of Sponsoring Organizations of the Treadway Commission.The guidance, titled "Internal Control over Financial Reporting - Guidance for Small Public Companies," was released with a Webcast that was attended by over 1,750 participants.

One of the provisions inserted by the Conference Committee into the Tax Increase Prevention and Reconciliation Act of 2005, signed by President Bush on May 17, 2006, was a tax increase on citizens working abroad. The provision was not in either the House or Senate versions of the legislation, although Congress has considered a number of proposals related to the taxation of citizens working abroad over the years, including some Senate bills in the current Congress.It is estimated that over 4 million citizens work abroad. The U.S. Census does not count them, so we have no accurate numbers. The Treasury does try to tax them, but with questionable effectiveness. For the 1999 tax year, out of 127,667,890 returns filed, 1,350,890 had foreign addresses, but this included the APO and FPO addresses of members of the armed forces, as well as some Puerto Rico residents with offshore income. A 2004 Internal Revenue Service study reported that in 2001, fewer than 300,000 tax returns reported foreign-source-earned income.

The Public Company Accounting Oversight Board named Kyra Armstrong, Ray Hamm and Jerry Decker as deputy directors in the Division of Enforcement and Investigations unit.

Maintaining that there's near-universal agreement that the nation's tax code is too complex, Sen. Chuck Grassley, R-Iowa, chairman of the Senate Finance Committee, officially opened the committee's hearings titled "Kick-off for Tax Reform: Tackling the Tax Code."

The Securities and Exchange Commission will commission a study to compare how the different regulatory systems that apply to broker-dealers and investment advisers affect investors.

From inside the profession, or even working closely besides it, it's sometimes hard to imagine that there's anyone who doesn't have at least a cursory understanding of what Sarbanes-Oxley meant for the profession, or why the debate over Section 404 continues years after its implementation.

A Senate report estimates that tax cheating now equals about 7 cents out of each dollar paid by honest taxpayers, or as much as $70 billion annually.

It's time for public companies to begin disclosing the reasons behind an auditor change, a new report from Glass Lewis & Co. argues.

The American Institute of CPAs has released two exposure drafts, one tackling standards for attestation engagements, another amendments to auditing standards.

Many times I have told readers of this column and of Practical Accountant of state Web sites that list owners of unclaimed property that was transferred to the state from businesses and entities that were holding the property for years, but who weren't able to communicate with the property owner so the property could be claimed. I figured firms could publicize the sites, and a perusal would result in "found money" for a number of the firm's clients.