Piano maker Steinway Musical Instruments has opted to tune out Deloitte & Touche as its outside auditor and replace the Big Four firm with UHY, after its audit committee decided UHY offered a better price.

An Oregon federal court has permanently barred John Fitzgerald of Portland and his three daughters - Marilyn Dial, Martha Farr Sharp and Karen Gray - from marketing a tax fraud scheme involving sham nonprofit corporations that customers used to evade federal taxes, the Justice Department said.

House Approves Taxpayer Assistance and Simplification Act

It is my belief that despite the various newsletters, publications and sections on the AICPA Website, what the AICPA is doing that directly impacts its members can be publicized better by the AICPA.

The Internal Revenue Service said it would soon issue guidance to help businesses determine how to use the special 50 percent bonus depreciation allowance included with the recent economic stimulus legislation.

The International Auditing and Assurance Standards Board has revised the international standards requiring management to provide auditors with a clear written statement that auditors have received all the information they need.

CPAs who conduct valuations in the normal course of their practices are now required to comply with detailed standards.

In mid-February, we received an e-mail about our off-balance-sheet financing column (“Off-balance-sheet financing: Holy Grail or holey pail?” Accounting Today, Feb. 11-24, 2008, page 13) from Craig Bruya, currently chief financial officer of a Microsoft division, a former Andersen auditor and an erstwhile accounting instructor.We don’t mind getting under readers’ skins if it jars them loose from complacency. In this case, it appears we did the former, but not the latter. We think others would learn from seeing his challenges (which appear in italics but have been edited for prolixity) and our replies.

FIDELITY: RETIREES NEED $225,000 FOR HEALTH CAREFidelity Investments has released a report estimating that a 65-year-old couple retiring in 2008 would need approximately $225,000 to cover their medical costs in retirement, a 4.7 percent increase over the 2007 estimate of $215,000. Fidelity has been calculating retiree health care cost estimates annually since 2002. The number has risen a total of 41 percent since then, with an average annual increase of 5.8 percent. The 2008 estimate assumes that individuals do not have employer-sponsored health care coverage. The estimate includes expenses associated with Medicare Part B and D premiums, Medicare cost-sharing provisions such as co-payments and deductibles, and out-of-pocket costs for prescription drugs. It does not include other health-related expenses, such as over-the-counter medications, most dental services and long-term care.

The Treasury Department and the Internal Revenue Service have issued proposed regulations to provide funding guidance for single-employer defined-benefit plans.

The fiscal year 2007 audit rate for the nation's largest corporations has plunged to its lowest level in the past two decades, according to a new report.

UHY Advisors has become a services partner of business software developer SAP America.

Racing to find political common ground on estate tax policy before the Bush administration tax cuts expire, congressional leaders are urging Republicans and Democrats to “think outside the box” when considering reforms.Among the alternatives placed on the table for discussion during recent Senate Finance Committee hearings: proposals to tax the beneficiaries of inheritances, rather than estates, as well as options under which estate taxes would be levied based on the heir’s “access to sophisticated tax advice.”

When the Governmental Accounting Standards Board issued Statement 34, requiring government-wide accrual accounting and modified accrual accounting for governmental funds, it improved financial reporting enormously, but inevitably created some confusion.Part of that confusion was over one of the most widely used pieces of government financial information — fund balance. Grappling with vague definitions of “reserved” funds, state and local governments have been reporting restricted net assets and reserved fund balances inconsistently.

Two bills proposed in the Senate last year that take aim at tax havens and the U.S. taxpayers that operate in them have been given greater impetus by the recent European and U.S. probes into accounts in Liechtenstein that were alleged to hide assets from national taxing authorities.S. 396, introduced by Sen. Byron Dorgan, D-N.D., would prevent American companies from deferring the imposition of a second layer of tax on their foreign-source income if they operate in selected low-tax nations. It would amend the Internal Revenue Code to treat certain controlled foreign corporations created or organized under the laws of a tax-haven country as domestic corporations for tax purposes. It sets forth a list of “tax-haven” countries, and grants the Treasury authority to remove or add a country from the list.

Despite a recently issued safe harbor now available for like-kind exchanges of vacation properties, the Internal Revenue Service continues to keep taxpayers guessing on the precise boundaries of the law itself.Last September, the Government Accountability Office came out with a critical report on like-kind exchanges in which it complained that the IRS needed to give taxpayers more guidance on like-kind exchanges of second homes and vacation retreats. The GAO claimed that the IRS had agreed with its findings and had promised to release more specific guidance. The latest IRS response seems to fall short of that commitment.

Until 1991, the accounting profession was largely guided by historical cost, transaction-based accounting.Granted, fair market value and historical cost at the point of the transaction were deemed equivalent, provided that arm’s-length transactions were involved. However, those making decisions — investors, auditors and regulators — grasped that unless someone gave and accepted consideration for something, its underlying value was arguable.

As investors and regulators increasingly question the role of fair value measurements and mark-to-market accounting in contributing to the global economic downturn, a group of speakers weighed in at a panel discussion sponsored by the CFA Institute Centre for Financial Market Integrity.

CPAs who conduct valuations in the normal course of their practices are now required to comply with detailed standards.

At the Financial Planning Association business solutions conference last month, Julie Littlechild, president of Advisor Impact, presented new information based on a survey of investors about the economics of loyalty. In effect, she was showing what turns a client from satisfied-but-passive to actively engaged in the growth of an advisor’s business. “Client engagement is the outcome of a practice that is structured effectively and a driver of future growth in an advisor’s business,” she says. “Advisors can achieve a balance between a level of service that is both meaningful to their clients and profitable to then, but which encourages clients to be actively engaged in the growth of the advisor’s business.” Vanguard Financial Advisory Services sponsored the study and notes the results underscores that there is a direct economic correlation between having engaged clients and having a thriving practice. Littlechild says that of the investors surveyed (some 1,000), 17 percent were disgruntled, 19 percent were complacent, 31 percent were content, and 33 percent were “engaged.” Actually all of those in the disgruntled section had thought about switching advisors. Obviously, the thrust of any practice is to move clients into the “engaged” category because the economics of loyalty are simply too great to ignore. Keep in mind that the higher up the scale clients move—from disgruntled to complacent to content to engaged—the more services they utilize, including comprehensive financial planning, retirement income planning, tax planning, estate planning, and trust services. Also, it may go without saying that the engaged clients are more loyal clients. They are unlikely to switch advisors. So, how to get clients into this category? Littlechild offers a few tips: