Regulatory actions and programs

The past year has seen an unprecedented amount of new tax legislation and regulations affecting business taxpayers.

The Securities and Exchange Commission was somewhat ambivalent last August when it approved a "roadmap" towards accepting International Financial Reporting Standards for U.S. publicly held companies.Indeed, several months after agreeing on the framework for its ultimate mandate of IFRS accounting beginning in 2014, the regulator still hadn't published an official document outlining its decision. But that apparently isn't dampening accounting firms' commitment to gearing up for IFRS, or to alerting clients to IFRS's sweeping ramifications.

The Internal Revenue Service has not developed sufficient processes to ensure that more than 61 million tax refunds were directly deposited last tax season to the correct bank account, according to a new report from the Treasury's inspector general.The Treasury Inspector General for Tax Administration said that the IRS places responsibility for compliance with federal direct deposit regulations on the taxpayer, and indicated that it is the taxpayer's responsibility to ensure that their tax refunds are directly deposited only into their accounts. TIGTA and representatives from the Treasury's Financial Management Service, however, believe that the IRS is responsible for enforcing the requirement.

The Financial Accounting Standards Board has provided new flexibility to allow banks and other financial institutions to reprice their assets during the credit crisis by amending its standard on fair value measurements.The FASB Staff Position clarifies the application of FASB Statement No. 157 in an inactive market and provides an illustrative example to demonstrate how the fair value of a financial asset is determined when the market for that asset is inactive.

One (and possibly the only) positive result of the financial crisis is that market value accounting has been brought to the public's attention.Unfortunately, most discussions of this issue have generated much more heat than light. For instance, we've noted that many who criticize value-based accounting don't begin to understand its advantages over other asset and liability measures. We want to explain the theory behind it, which is how we came to be convinced that all the trouble of switching to values will be worthwhile. This perspective has helped us see that most criticisms of market value are transparent attempts to deflect blame away from managers who made poor investment decisions.

Accounting schools are scrambling to stay ahead of the IFRS curve.

The Private Company Financial Reporting Committee discussed FIN 48, fair value and other matters at its latest meeting.

The Financial Accounting Foundation advised President Bush and other U.S. and world leaders attending the G-20 summit to safeguard fair value accounting and the independent standard-setting process in a strongly worded letter.

The Securities and Exchange Commission charged network security company Blue Coat Systems and its former CFO, Robert P. Verheecke, with allegedly backdating stock option grants and reporting false financial information, and he has settled the charges for $185,000.

Financial Executives International has written to House and Senate Leaders urging lawmakers to consider relief for small and closely held business in the event of any future stimulus packages.

The Center for Audit Quality defended the use of fair value accounting in a letter to the Securities and Exchange Commission as the standard comes under attack from banking interests.

International Accounting Standards Board Chairman Sir David Tweedie said he nearly resigned before giving in to pressure from European regulators to modify fair value accounting standards to allow banks to reclassify their assets.

The International Accounting Standards Committee Foundation has written a letter to President Bush asking him and other world leaders to respect fair value accounting and the standards-setting process.

The American Institute of CPAs has written to the Securities and Exchange Commission urging it to allow the Financial Accounting Standards Board to continue to set standards for mark-to-market accounting.

Deloitte & Touche has sued former vice chairman Thomas Flanagan, claiming that he profited from stock trades using inside information about the firm's audit clients.

The American Institute of CPAs' Auditing Standards Board has revised a standard on the use of electronic confirmations to provide further guidance on reliability.

President-elect Barack Obama is looking for a new chairman of the Securities and Exchange Commission to replace departing chair Christopher Cox.

The Securities and Exchange Commission is expected to publish the long-delayed roadmap for transitioning to International Financial Reporting Standards on Friday.

The American Institute of CPAs’ Fall Council meeting in October focused on the state of the economy, a proposal to internationalize the CPA credential, distinguished service awards and welcoming the upcoming year’s new chairman of the board.

They do it for the Academy Awards, so why not for the presidential elections?