GETTING READY FOR TAX SEASON
Even before the October 15 extended deadline had passed, the thoughts of many had turned to next tax season. In early October, Internal Revenue Service Commissioner John Koskinen wrote a letter to the leaders of Congress's main tax committees urging them to decide soon on what to do about extending dozens of expired tax provisions, or else next tax season could be delayed.
And on October 16, the IRS opened up for PTIN applications and renewals, so professional tax preparers could get the ID number that's required of anyone who prepares a return for money. The service recommends going through the process online; you can file on paper, but it will take four to six weeks.
Tax preparers charge an average of $142 for preparing a 1040 and up to an average of $566 for an 1120, according to a survey by the National Association of Tax Professionals. Almost half of those surveyed (43 percent) said they prepared an increasing number of returns over the past two years; a similar percentage (46 percent) saw their return workload remain the same over the past two years.
The Treasury Department reported in mid-October that the federal government brought in $3.02 trillion in tax and other revenues in fiscal 2014 -- its highest take ever. $1.39 trillion came from individual income taxes; $320.7 billion from corporate income taxes; and $1.03 trillion from social insurance and retirement receipts, with the balance coming from excise, estate and gift taxes, and other miscellaneous receipts.
THE WORLD BEYOND TAX
In yet another major merger, Top 10Firm CohnReznick signed a letter of intent to combine with Bethesda, Md.-based Top 100 Firm Watkins Meegan, in a deal that was due to close on November 1.
Audit fees increased slightly in 2013, according to a report by Audit Analytics, but remain lower as a percentage of revenue than in 2004. The study found that the average audit fee paid in 2013 by the companies covered was $479 per million dollars of revenue, up by 1.4 percent from 2012. However, audit fees in 2012, at $472 per million in revenue, were the absolute lowest since the implementation of Sarbanes-Oxley Section 404 in 2004, when audit fees averaged $592 per million dollars of revenue.
Average starting salaries for accounting and finance professionals in the U.S. are forecast to rise 3.5 percent next year, according to the 2015 Salary Guide produced by staffing company Robert Half. Staff accountants, senior financial analysts and business systems analysts are in strong demand, and can expect to see higher than average increases.
IN OTHER NEWS
Big Four firm Ernst & Young announced that it plans to recruit approximately 6,500 experienced professionals in the U.S. in its 2015 fiscal year, which started on July 1, 2014, along with nearly 9,000 students, for a total of 15,500 anticipated recruits in the U.S. The firm noted that the 6,500 positions it plans to hire this fiscal year represent an increase of nearly 50 percent from two years ago.
The Center for Audit Quality's 2014 Main Street Investor Survey of roughly a thousand investors found their confidence in investing in U.S. public companies was at an all-time high, with 80 percent of respondents reporting some, quite a bit or a great deal of confidence there. Audited financial information followed closely after that, with 75 percent of respondents reporting similar confidence.
Approximately 9,000 current and former female employees of KPMG received notices about the opportunity to join a class-action lawsuit against the firm involving the Equal Pay Act, claiming they were paid less than their male counterparts. A U.S. District Court has granted a law firm that initiated the lawsuit in 2011 the right to mail the notices to women who have worked at the firm since 2008. The notice was mailed on October 3.
Over three quarters (77 percent) of firms reported in a recent survey that they allow staff to work remotely. The poll by ConvergenceCoaching also found that 41 percent of firms no longer mandate Saturday work during busy season.
In "Case Studies: Workflow" (October 2014, page 24), we misspelled Jonathan Medows name. Our apologies for the error.
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