After years of sounding the fiscal imbalance bell, Comptroller General David Walker, the head of the Government Accountability Office, has committed a to-do list to paper for the 110th Congress.In a letter dated Nov. 17, Walker outlines a number of areas his federal watchdog agency, says the newly-elected politicians should consider in getting a “jump-start” on legislative planning.

SENIOR CAPITAL DISMISSES KPMG: Senior Capital Living Corp., a Dallas-based operator of senior residential communities, jettisoned its auditor, Big Four firm KPMG, and named Ernst & Young as its new independent accountant.KPMG's audit report for the year ended Dec. 31, 2005, noted ineffective internal controls over financial reporting. The auditor stated that SCLC's policies and procedures, and allocation of resources, did not provide for an effective review of the company's accounting for income taxes, which was prepared by tax consultants and third-party advisors.

High-profile corporate scandals in recent years have seriously eroded public confidence in published financial results.Reliance on the accuracy of financial statements is essential if investors are to own equity or debt instruments of corporations. With the passage of the Sarbanes-Oxley Act in 2002 leading the way, the governance role and function of boards of directors are evolving and expanding for public and private companies, as well as nonprofit organizations.

The controversy over options backdating just won't go away, and with good reason.According to the latest count, more than 120 companies are under investigation for doing it. In September, the heretofore-worshipped Steve Jobs was in the news with an apology for past backdating misdeeds at Apple. Even though he denied receiving any backdated options, he apparently approved some, but claims he was unaware of any accounting impropriety.

FIDELITY LOWERS MINIMUM GIFT FUND CONTRIBUTION: In an effort to make the benefits of donor-advised funds more accessible, the Fidelity Charitable Gift Fund announced that it would lower its initial contribution and grant recommendation minimums.

Last year, Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, and with that legislation came some changes in the way bankruptcy debtors are taxed.New Internal Revenue Service guidelines have been issued to help explain provisions of the act that affect individual taxpayers filing Chapter 11 bankruptcies. The guidelines are issued in IRS Notice 2006-83 and relate to all Chapter 11 bankruptcies filed on or after Oct. 17, 2005.

The American College, a financial services educator based here, has launched an expedited learning program designed to prepare financial advisors for the Certified Financial Planner certification examination in roughly seven months.Developed in conjunction with the JR Financial Group, a financial services trainer, the program, titled Financial Planning Express, combines self-study with a series of live, four-day classroom sessions held every six weeks. The six modules that comprise the Express program conclude three weeks prior to the CFP certification examination with a live, five-day comprehensive review of all 89 CFP topics covered on the test.

Federal prosecutors will not challenge a judge’s ruling that vacates the conviction of Enron founder Ken Lay, who died in July after being found guilty for his role in the massive corporate accounting scandal.

The Securities and Exchange Commission is closing in on an early Christmas present for corporate critics of the Sarbanes-Oxley Act - a new plan that would reduce the compliance problems associated with the legislation's prickly Section 404 auditing requirements.But the expected reforms - which are scheduled for public consideration at an SEC meeting in mid-December - are not likely to quiet the chorus of criticism from Congress and the wider business community that blames SOX for making American capital markets uncompetitive, driving stock listings overseas and creating massive new costs for small companies.

In an effort to improve consistency in the application of standards relating to audits of the fair value of options granted to employees, the Public Company Accounting Oversight Board staff has issued a set of guidelines.Presented in a question-and-answer format, the guidelines point out risk factors that auditors should be aware of in their consideration of the process for developing a fair value estimate, significant assumptions used in option-pricing models, and the role of specialists in fair value measurement.

Business tax reform needs a bipartisan, national consensus, but is absolutely necessary for the country to remain competitive in a global economy, according to Senate Finance Committee chair Chuck Grassley, R-Iowa."I think the consensus is there that the business tax system is in desperate need of reform," he told a recent hearing on the business tax system. "But we need to start building consensus on how to do it."

The use of private annuities to shelter gain on appreciated property has come to an abrupt halt, if the Internal Revenue Service has its way.Whether the IRS can withstand pressure to withdraw or substantially amend new proposed regs before they are made final, or whether the final regs can withstand judicial challenge, remains to be seen. For now, however, effective for annuity transactions after Oct. 18, 2006 (subject to a relatively brief six-month "estate planning" exception), the division between "old rule" and "new rule" is dramatic.

The Financial Accounting Standards Board has voted to propose changes to a derivatives rule issued earlier this year affecting the financial statements of asset-backed and mortgage-backed securities investors.The proposal would affect FASB Statement No. 155, Accounting for Certain Hybrid Financial Instruments, and allow companies not to account for embedded derivatives that are associated with prepayment risks. Community banks, insurance companies and others may be exempted from having to recognize interest-rate-driven gains and losses on their income statements. Many of those groups had said that without such an exemption, their earnings might be more volatile.

The Securities and Exchange Commission announced that thousands of individual investors who made financial claims in the wake of the $11 billion WorldCom accounting fraud will soon receive up to $150 million from a commission fund set up to help compensate investors for their losses.The SEC's ability to return penalty money directly to fraud victims is a new authority granted under the Sarbanes-Oxley Act. The entire $750 million penalty that the SEC obtained from WorldCom was paid into a "Fair Fund" when the reorganized telecommunications company emerged from bankruptcy protection in April 2004. All of that money is earmarked for return to injured investors.

The Committee of Sponsoring Organizations of the Treadway Commission issued a request for proposals to develop guidance to help organizations monitor the quality of their internal control systems.The end product is meant to serve as a tool for effectively monitoring internal controls, as well as complying with the Sarbanes-Oxley Act.

Speaking to a group of financial executives, a Securities and Exchange Commission accountant said research from his office has revealed that most restatements are due to basic accounting mistakes.Speaking at the annual conference of Financial Executives International, SEC deputy chief accountants Scott Taub said that about 55 percent of recent company restatements were due to the misapplication of basic accounting rules or to problems with the actual data used in the original calculation.

While he didn't call for any new regulations, or outright suggest the overturning of any existing rules, in a speech this week Treasury Secretary Henry Paulson urged federal regulators to take a more hands-off approach when it comes to dealing with the markets.Speaking on the competitiveness of the capital markets at the Economic Club of New York, Paulson told the audience that U.S. accounting and securities regulators should consider adopting flexible accounting rules that outline principles, but don’t set strict rules.

The Internal Revenue Service announced a formula allowing businesses and tax-exempt organizations to estimate their federal telephone excise tax refunds.In May, the government announced that it would stop collecting the federal excise tax on long-distance telephone service beginning Aug. 1, 2006, and provide refunds for taxes billed after Feb. 28, 2003.

Former Enron chief executive Jeffrey Skilling will head to a low-security federal prison in Waseca, Minn., on Dec. 12 to begin serving a prison term of 24 years and four months for his conviction on fraud and conspiracy charges.

My first brush with the National Collegiate Athletic Association came during my tenure as sports editor of my college newspaper. Two star players from the hockey team had been slapped with season-long suspensions for accepting room and board -- not even money, mind you -- while playing as juniors in Canada.