Regulatory actions and programs

The economic downturn, coupled with proposals to make the Research and Development Credit permanent, the potential repeal of LIFO, and higher individual tax rates under the Obama administration, could significantly reshape the landscape of S corps over the next several years."For planning purposes, the proposal to make the R&D Credit permanent has significance because it will affect what types of investments companies will make," explained Rick Klahsen, managing director at RSM McGladrey's national tax department. "However, the proposed repeal of the LIFO inventory method would have a tremendous negative impact on S corporations. Many S corporations are manufacturers, and the loss of the LIFO method will cost them in terms of additional taxable income. It will cause them to take a look at the types of inventory investments they might make."

Washington, D.C.-In the wake of several high-profile Ponzi schemes - most notably, the $65 billion fraud perpetrated by the now-jailed Bernard Madoff - the Internal Revenue Service has issued new guidance for victims of these types of schemes and their tax preparers.

Among the many changes born of the financial crisis that's sweeping the globe are changes in internal auditing departments.

About a year ago, we began hearing a clamor that accountants exacerbated the financial debacle by reporting market values in financial statements. In turn, accountants ducked the blame by arguing strongly that the Financial Accounting Standards Board was at fault for requiring investment market values to be reported. These complaints have continued to this day.

The Public Company Accounting Oversight Board isconsidering making changes in the standards for audit confirmations after arecent wave of auditing scandals.

As the profession prepares for the transition to adoptingInternational Financial Reporting Standards, the Center for Audit Quality hasfired off a letter to the Securities and Exchange Commission offering a seriesof recommendations to improve the regulator's proposed IFRS roadmap.

At least one critic of the proposed changes inmark-to-market and fair value accounting rules is changing his tune and seeingsome positive signs in the final version.

The Texas Society of CPAs warned the Financial AccountingStandards Board that FASB's recently approved changes in fair value accountingstandards could damage the credibility of CPAs in general.

Seventy-five percent of finance professionals support the movement toward a single set of high-quality global accounting standards, according to a new survey by Deloitte.

The Public Company Accounting Oversight Board has released a list of countries abroad where it intends to conduct inspections of auditing firms.

Two auditors from PricewaterhouseCoopers’ Indian member firm have been charged in the Satyam accounting scandal.

Canada’s Accounting Standards Board said that it has not yet made a decision on whether to change its fair value standards to match up with U.S. standards.

The International Federation of Accountants has endorsed a set of proposals made at last week’s G-20 Summit of world leaders that aim to reform the global financial regulatory system.

The Public Company Accounting Oversight Board has scheduled a series of forums around the country on auditing in the small business environment.

As the economy continues its downturn and the financial pressure on business increases, the risk of fraud becomes higher than ever.To help your clients protect their businesses, suggest that they evaluate the current state of their anti-fraud program to minimize the duration and potential loss of fraud. When evaluating a current program, they should consider their preventative measures, not just their detective measures.

As governments desperately seek all kinds of additional revenue, senior business professionals see the increased possibility of an audit by taxing authorities as the most significant tax risk facing their organizations today, according to a new survey.

The Monitoring Board that was recently established to add more public accountability to the International Accounting Standards Board has held its inaugural meeting and picked its first leader.

The Financial Accounting Standards Board has issued a “plain English” summary of the board’s actions when it modified the standards for fair value and mark-to-market accounting in response to congressional demands.

The Securities and Exchange Commission has revoked the license of an Arizona CPA and filed charges accusing him of running a $67 million Ponzi scheme.

Washington, D.C.-The Internal Revenue Service has decided not to renew its contracts with two private debt collection agencies.The IRS said that the decision came after an extensive review of the controversial program. A provision to end the private debt collection program was inserted into the omnibus spending bill that is currently before the Senate.