TOO QUIET?

Tax season ground on, with tons of work but relatively little fuss -- no major service problems or troubles had surfaced by the third week of March, by which point the Internal Revenue Service reported that it had received approximately half of all the individual tax returns that it expected to receive.

On a less encouraging note, it saw an increase of almost 6 percent in the number of taxpayers filing their tax return from home (and thus, presumably, not using a professional preparer). Over 27 million made that mistake, out of the 62.2 million individual returns the IRS had received as of press time.

President Obama released his budget plan in early March, with proposals for expanding a number of tax breaks along with the budget of the Internal Revenue Service. The $3.9 trillion budget included proposals that would invest $12.5 billion in the IRS to improve service and reduce the deficit through more effective enforcement; double the maximum value of the Earned Income Tax Credit for childless workers; and improve tax benefits that help middle-class and working families.

Just a week earlier, House Ways and Means Committee Chairman Dave Camp, R-Mich., had released his long-awaited draft legislation on tax reform. Among other things, he proposed reducing rates and collapsing today's brackets down to two; reducing the corporate rate; offering a larger standard deduction and a larger Child Tax Credit; eliminating the Alternative Minimum Tax; and simplifying the taxation of investment income.

The Financial Accounting Standards Board issued a draft version of its Disclosure Framework, aimed at improving its process for evaluating existing and future disclosure requirements in the notes to financial statements (see page 14). Separately, in late February the board members voted to scale back FASB's convergence efforts on insurance accounting standards with the International Accounting Standards Board.

The issue of the IRS's scrutiny of conservative political groups was in the spotlight again, as the service handed over a trove of documents to Rep. Camp, including e-mails from the retired official who oversaw that scrutiny -- Lois Lerner -- who took the Fifth and refused to testify during congressional hearings in early March.

The Supreme Court ruled in favor of expanding the whistleblower protections of the Sarbanes-Oxley Act to include private firms that act as contractors and subcontractors for public companies. The court specifically noted that the case might well apply to accounting firms.

The Governmental Accounting Standards Board drafted a proposed Hierarchy of GAAP for State and Local Governments, listing the order of priority for the types of pronouncements that a state or local government should look to for guidance when preparing their financial statements. The proposed statement would reduce the existing GAAP hierarchy to two categories of authoritative GAAP from four.

Separately, the board released a new online pension implementation toolkit to help preparers, auditors, and users of state and local government financial reports understand and apply the revised pension accounting and financial reporting standards that GASB approved in June 2012. The toolkit is available free on GASB.org.

KPMG International selected John Veihmeyer, the chair and CEO of its U.S. firm, as global chairman, succeeding Michael Andrew, who is retiring due to a serious medical condition. Andrew plans to focus on his treatment and recovery while continuing his work as co-chair of the Australian B20 Working Group on Anti-Corruption. Veihmeyer is expected to continue his role as chairman and CEO of the U.S. firm while also taking on the role of global chairman.

QuickBooks maker Intuit Inc. announced that it will host an industry event for small-business owners, accounting professionals and software developers in San Jose, Calif., on October 22-24.

 

CORRECTIONS

In our 2014 Top 100 Firms/Regional Leaders report, we included Wipfli in the wrong region; it is headquartered in Milwaukee and so should, of course, have been included in the Great Lakes Region. Updated regional figures are available with the online version of the report. Our apologies for the misplacement.

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