Audit & Accounting

Congress is currently at work on legislation that includes, among other things, a two-year extension of dividend and capital gains tax cuts that were scheduled to expire at the end of 2008, and a one-year extension of alternative minimum tax relief.Without this relief, the AMT would cause higher taxes starting in 2006 for an estimated 16 million additional taxpayers to whom it was not intended to apply. Perhaps not surprisingly, House Republicans have sought to finalize the dividend and capital gains extension first, even though the AMT problem is much more immediate.

With a proposal that would let companies opt to report selected financial instruments at fair value, the Financial Accounting Standards Board has opened the possibility of a significant move toward more fair value measurement.The board has issued the proposal as an exposure draft in hopes that comments will support it as a reduction in the complexity of accounting and in volatility in earnings.

A federal review of 13 major contracts awarded in the aftermath of Hurricane Katrina pointed to poor communication as the reason behind the waste and mismanagement of some supplies and services that went unused.

The Office of Thrift Supervision approved an application from H&R Block Inc. to organize a federal savings bank in Kansas City, Mo.

Retail drugstore chain CVS Corp. said the Securities and Exchange Commission has launched an informal probe into how the company accounted for a 2000 transaction.

New York's Attorney General filed a $250 million fraud suit against H&R Block Inc., accusing the tax prep giant of steering hundreds of thousands of clients to investment retirement accounts with costs higher than what they would earn back.

Bankruptcy filings rose 10 percent last year, to a record 1.78 million, according to figures released by the federal court system.

After 16 years, the executive director of the Securities and Exchange Commission will step down to pursue opportunities in the private sector.

Three consumer credit reporting agencies announced that they have created a new credit scoring system to simplify the loan process for lenders and borrowers.

The Securities and Exchange Commission and the Financial Services Authority, the regulator of financial services providers in the United Kingdom, have signed an agreement to increase cooperation in market oversight and supervision.