SENATORS TARGET TAX HAVENSWASHINGTON - A trio of senators has proposed legislation targeting overseas tax havens. Such havens cost the U.S. upwards of $100 billion a year in lost tax revenues, according to Sen. Carl Levin, D-Mich.
The bill would require hedge funds to establish programs to combat money laundering and better track offshore investors. It would also prevent the U.S. Patent and Trademark Office from issuing patents for accounting strategies intended to reduce or avoid tax liability.
The bill, co-sponsored by Sen. Norm Coleman, R-Minn., and Barack Obama, D-Ill., would impose stringent requirements on taxpayers using offshore secrecy jurisdictions, let the Treasury act against foreign jurisdictions that impede tax enforcement, stiffen penalties for abusers and close some offshore loopholes.
FASB ESTABLISHES FAIR VALUE OPTION
NORWALK, CONN. - The Financial Accounting Standards Board has issued a standard providing companies with an option to report selected financial assets and liabilities at fair value.
The statement, FAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities, also establishes presentation and disclosure requirements designed to simplify comparisons between companies. The standard requires companies to provide information to help statement users understand the effect of a company's choice to use fair value on its earnings, as well as to display the fair value of the assets and liabilities that a company has chosen to use fair value for on the balance sheet.
The statement is effective as of an entity's first fiscal year beginning after Nov. 15, 2007. Early adoption is permitted as of the beginning of the previous year, provided the entity makes that choice in the first 120 days of that year.
PWC TO SHUTTER JAPANESE PARTNER
NEW YORK - Not even a year after pledging to stand by its Japanese affiliate, PricewaterhouseCoopers announced that the doors to Misuzu Audit Corp. would close, after revelations of the unit's ties to a second scandal. Misuzu, one of Japan's Big Four accounting firms and part of PwC, said that it faced penalties stemming from its work for brokerage house Nikko Cordial, which faces record fines for accounting fraud.
Last summer, Japan's Financial Services Agency ordered Misuzu to halt its audit operations for two months after several auditors were linked to financial fraud at a major cosmetics manufacturer. Shortly after the punishment was handed down in May, PwC announced that its new Japanese accounting affiliate, Aarata, would open for business by July.
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