SUPREME COURT NIXES TEXTRON APPEAL

Washington, D.C. - The Supreme Court declined to hear Textron's appeal in a key tax case, letting stand a lower court decision that allows the Internal Revenue Service to demand legal and tax workpapers from companies. The company had appealed a ruling by the First Circuit Court in the case.

The IRS had requested tax accrual workpapers from the corporate jet manufacturer, including a spreadsheet compiled by its attorneys showing potential items of contention with the IRS and its chances of winning them. The company asserted work product privilege and won two rulings, but the full First Circuit Court ruled in the IRS's favor. The Supreme Court let that decision stand.

FASB PROPOSES NEW FINANCIAL INSTRUMENT STANDARDS

Norwalk, Conn. - The Financial Accounting Standards Board has issued an eagerly anticipated exposure draft of a proposed accounting standards update for financial instruments, a major sticking point in FASB's efforts to converge U.S. GAAP with International Financial Reporting Standards.

Among other changes, the proposed update would incorporate both amortized cost and fair value information about financial instruments held for collection or payment of cash flows, and remove the "probable" threshold for recognizing credit losses.

The comment period extends through Sept. 30, 2010. FASB will also hold public roundtable meetings immediately following in October to collect further input. Details will be announced later.

FASB also issued a separate, but integral, proposed update that would require that total comprehensive income and its components in two parts - net income and other comprehensive income - be displayed in a continuous statement of financial performance.

The exposure drafts for both are available at www.fasb.org.

CORRECTION

In the People section of our May 24-June 6, 2010, issue, we incorrectly located Texas firm Sanford, Baumeister & Frazier PLLC in Houston; it is, in fact, in Fort Worth. Our apologies for the error.

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access