Audit

A study commissioned by the United Kingdom's accounting regulator and the U.K. Department of Trade and Industry said that the dominance of the Big Four is not healthy for competition and prevents small and midsized firms from gaining entry into blue-chip clients.

The chairman of an advisory panel to the Securities and Exchange Commission said that the group's pending proposal to roll back some of the internal controls provision of the Sarbanes-Oxley Act has not been dismissed even before it is officially proposed.

A husband and wife have filed a case against Ernst & Young, blaming the firm for the loss of $40 million in a tax shelter deemed abusive by the Internal Revenue Service, according to a published report.

Financial literacy scores of high school students continue to hover just around the 50 percent mark, according to the Jump$tart Coalition for Personal Financial Literacy, a national non-profit organization.

The country's largest jewelry retailer, Zale Corp., announced that its accounting, executive pay and severance agreements are under official investigation by the Securities and Exchange Commission.

The just-released Winter 2005-2006 issue of the Statistics of Income Bulletin discloses that adjusted gross income rose in 2004 for the second year in a row, increasing by 8.9 percent to $6.8 trillion. The largest component of AGI, salaries and wages, increased 6.0 percent to $4,977.9 billion, while net capital gains rose 53.2 percent to $442.1 billion. Taxable income increased 10.6 percent to $4.6 trillion.

Eighty-four percent of senior finance executives polled by global CPA and business advisory firm Grant Thornton said that rules that allow companies in bankruptcy to turn over their pension obligations to the federal Pension Benefits Guaranty Corp. should be tightened.

A survey of 120 chief financial officers and comptrollers found that more than 80 percent of the executives are in favor of rules that would make it harder for bankrupt companies to turn over pension obligations to the Pension Benefits Guaranty Corp.

My brother just retired from Cherry Hill, New Jersey, to Venice, Florida. "I used to be a doctor," he now says, and then turns to one of three books he will read in a week.

A new survey says that the average cost for the internal controls provisions of the Sarbanes-Oxley Act is $3.8 million, down 16.3 percent from last year and about halfway to the drop anticipated for the second year of compliance.

Personal bankruptcy filings dropped to their lowest level in 20 years during 2006's first quarter, according to financial research firm Lundquist Consulting Inc.

In remarks to reporters after a speech in Washington, Securities and Exchange Commission Chairman Christopher Cox said that small companies aren't likely to receive any exemptions from the Sarbanes-Oxley Act.

Federal regulators released a consumer research study that offers suggestions for consumer-friendly financial privacy notices.

Three former KPMG auditors settled charges of improper professional conduct for failing to properly complete the audit of Tenet Healthcare Corp.'s 2002 financial statements and them making changes to try and conceal their work.

The Auditing Standards Board of the American Institute of CPAs has issued a suite of eight new standards on risk assessment that should significantly improve the quality of audits of private companies.For the many audit firms that have traditionally offered high-quality audits, the new standards will probably not require a lot of additional effort.

The Financial Accounting Standards Board issued a proposal that would require employers to recognize over funded or under funded defined benefit postretirement plans, including pension plans, in their balance sheets. The proposal would also require that employers measure plan assets and obligations as of the date of their financial statements.

The Securities and Exchange Commission announced that 17 companies -- compared to nine under an initiative launched last year -- have already agreed to participate in a new pilot program to use interactive data in their financial statement filings.

Senior U.S. financial executives are confident in the financial performance of their own companies, even if the economy does not perform well this year, said a survey from accounting firm Grant Thornton.

House lawmakers heard from various regulatory bodies and association leaders on ways financial reports could be made more user-friendly for investors and the general public.

Public companies and their auditors will have some added leeway to ensure compliance with still unfinalized Public Company Accounting Oversight Board rules restricting the kinds of tax services auditors can provide.