The Latest

I’m usually not one for watching the early versions of the presidential debates. At this point the field is far too crowded with also-rans and never-wases, not to mention an alarming number of recycled hopefuls.

While conceding that the Internal Revenue Service has made significant progress in improving internal controls and financial management since its initial financial audit in 1992, it still needs to close some 75 recommendations from prior audits according to the Government Accountability Office. The auditor general said the IRS has resolved myriad internal controls weaknesses by closing over 200 of the GAO's recommendations over the past seven years, but since its 2006 audit, the GAO has identified 28 more, bringing the total to 75. The categories cited by the GAO for recommendations include: Safeguarding of assets and security activities; proper recording and documenting of transactions; and effective management review and oversight. The report can be accessed at www.gao.gov.

The Public Company Accounting Oversight Board is currently accepting 15 member nominations and re-nominations for its Standing Advisory Group. The 31-member SAG is comprised of representatives from audit firms, public companies and the investment community. Appointments are for two-year terms. The audit overseer has also scheduled its next SAG meeting for June 21 in Washington. The focus of the meeting will center on interim standards and fair value. Both the SAG nomination forms and the Webcast for the June meeting can be accessed at www.pcaobus.org. In related PCAOB news, chairman Mark Olson told attendees at a governance and compliance conference late last week, that the simpler language found in Auditing Standard No. 5 on internal controls should help pare down the costs of 404 compliance. Olson said AS5, unlike its predecessor AS2, was written in English and not "audit-speak."

Six of the nation's largest CPA firms have collaborated on a white paper and submitted it in late May to then-Internal Revenue Service Commissioner Mark Everson with a series of recommendations on strategies to close the $300 billion tax gap. The letter, submitted by executives from BDO Seidman, Deloitte, Ernst & Young, Grant Thornton, KPMG and PricewaterhouseCoopers, told Everson that strategies to narrow the massive payment fissure should encompass such areas as targeting the service's efforts toward high-risk areas of noncompliance, making better use of technologies, and establishing measurable milestones over reasonable time frames to monitor effectiveness. The paper also held tax preparers' feet to the fire as a part of the problem stating that in some cases, the preparers "failed to inquire for complete facts or otherwise facilitating noncompliance. Initiatives directed at improving the performance of paid tax return preparers and strengthening the integrity of the tax system should be undertaken as part of any strategy to improve voluntary compliance and reduce the tax gap," the paper said.

Moving to curb abuse of this year's one-time telephone excise tax refund program, the Justice Department and the Internal Revenue Service have obtained federal indictments against tax preparers who allegedly filed thousands of dollars in fraudulent refund claims. In recent weeks, alleged refund schemes involving preparers in Florida, Georgia, Texas and California have led to federal indictments. Shortly after tax season opened in January, the IRS observed problems with returns from some tax preparers that indicated possible criminal intent. Along with search warrants carried out by the IRS, tax preparers across the nation who prepared questionable refund requests received visits from IRS revenue agents and special agents. "We saw limited but serious instances of abuse," said IRS acting commissioner Kevin M. Brown. "We used our enforcement resources to move swiftly and decisively to protect this valuable refund for the vast majority of taxpayers and tax preparers who are requesting it properly."

Veteran accounting marketer Sally Glick, currently chief marketing officer and director of marketing consulting services at Livingston, N.J.-based Sobel & Co. LLC, was inducted into the Association for Accounting Marketing Hall of Fame. Her induction came at the group's 18th annual AAM Summit, here. The award honors the recipient's dedication to and promotion of the accounting marketing profession. After working several years at a local firm in the Chicago area, she became marketing director at Pencor LLC, a company providing professional service firms with niche marketing materials and programs. She then went on to become director of marketing services at firm association Polaris International. She also served as marketing director at regional CPA firm, J.H. Cohn. In 2003, she was honored as Accounting Marketer of the Year.

Yep, it's that time of the year again! CPA Wealth Provider is calling for nominations for its Fifth Annual Financial Planning Awards in any of the following categories: CPA/Financial Planning Firms, Broker/Dealers, and Financial Planning Software Vendors.Winners are those firms or companies that have taken the lead through innovation, efficiency, initiative, or growth in the financial planning area.

National CPA and business advisory firm RSM McGladrey Inc. and its audit and attest firm, McGladrey & Pullen LLP have completed the acquisition of Orlando, Fla.-based Tedder, James, Worden & Associates P.A. The audit and attest assets of Tedder, James, Worden & Associates are being acquired by McGladrey & Pullen while the accounting, tax and business consulting assets will become part of RSM McGladrey. The resulting consolidation will bring the total number of Florida employees to more than 400, with the combined RSM McGladrey and McGladrey & Pullen businesses encompassing eight offices in Fort Lauderdale, Jacksonville, Melbourne, Miami, Naples, Titusville, West Palm Beach and Orlando.

On the heels of strong tax revenue gains, state spending during the past fiscal year rose 8.6 percent over the year-ago period, but concerns over tighter budgets and more modest spending levels may be in the near future, according to the National Governors Association and the National Association of State Budget Officers. According to the 2006 Sales Tax Rate Report from tax technology products provider Vertex Inc., the average U.S. sales tax rate hit an historical high in 2006 at 8.579 percent -- up from 8.549 percent in 2005. Vertex also said that the number of tax rate changes in the U.S. grew by 28 percent since the late 1990s. "As the economy was flush with money in the late 90s, there is a recognized decrease in the number of tax rate changes from 1995-2000," said John Minassian, Vertex vice president of Tax Content Development. "However, ever since predictions of an economic bubble burst came to fruition in 2000, we have seen a severe increase in the number of rate changes, likely the result of local, city, county and state needs to increase revenue and balance budgets."

The nation's C-level financial executives expect to continue hiring during the third quarter, albeit at a slower pace than in the previous period. Some 6 percent of chief financial officers polled in the Robert Half Financial Hiring Index said they anticipated hiring employees in the third period, while 3 percent of those surveyed said they expected cutbacks. Meanwhile, 90 percent of the Robert Half respondents projected no changes in financial staffing levels. The Mountain and West South Central states forecast the greatest gains in financial hiring, with 10 percent of the executives in each region responding that they planned to hire additional staff, and just 1 percent projecting staff reductions. The Robert Half poll includes responses from more than 1,400 CFOs from U.S. companies with 20 or more employees.