Regulatory actions and programs

The Securities and Exchange Commission said it has issued settled administrative orders against eight auditors who improperly issued audit reports on the financial statements of public companies while the audit firms were not registered with the Public Company Accounting Oversight Board.

The Public Company Accounting Oversight Board plans to consider adopting an auditing standard on evaluating the consistency of financial statements at a meeting on Tuesday.

The Securities and EXchange Commission has issued a final rule on accepting financial statements prepared by foreign companies in accordance with International Financial Reporting Standards without reconciling them with U.S. GAAP.The SEC noted that it was accepting statements prepared in accordance with IFRS as issued by the International Accounting Standards Board, leaving out regional variations such as those approved by the European Union.

Securities and Exchange Commission Chairman Christopher Cox plans to propose another year’s delay in imposing Sarbanes-Oxley Section 404 requirements for small public companies.In testimony before the House Small Business Committee in mid-December, Cox said that he thought the additional delay would allow regulators to assimilate the results of a study now underway on the costs of 404 compliance. “I intend to propose to the commission that we authorize a further one-year delay in implementation for small businesses in order to base our decision on final implementation of Section 404(b) on the best available cost data,” he said.

Completing their first major joint project, the Financial Accounting Standards Board and the International Accounting Standards Board have agreed on two new standards on accounting for business combinations.FASB member G. Michael Crooch termed the new guidance “a significant convergence milestone [that] improves reporting while eliminating differences” between the standards that were previously promulgated by the two boards.

There may be 2-D bar codes in the future of paper-filed returns, if recommendations from the Government Accountability Office are followed.In its end-of-year report on last year’s tax season, the GAO said that the Internal Revenue Service exceeded the previous year’s performance by most measures. However, it noted a number of opportunities to realize additional savings and increase tax compliance, with the barcoding of paper returns among them.

In the last few days before Congress adjourned for 2007, a number of tax law changes finally made it through the two chambers and on to President Bush. The president has either already signed or indicated his willingness to sign each piece of legislation. Several of the provisions enacted will have an impact on 2007 tax returns.Even with this flurry of activity, a number of pieces of legislation, including most of the energy-related tax proposals, an agriculture bill with tax provisions, military tax relief, and the extension of expiring provisions, as well as a fairly extensive list of offsetting revenue raisers, got left off the table and will be addressed again in 2008. The following is a summary of each of the tax laws enacted, the principal provisions, and the impact, if any, on 2007 tax returns.

On my first visit to Washington, D.C., I almost missed the Jefferson Memorial because there were so many other memorials to look at. The same can be said of Financial Accounting Standards Board projects, because several projects are currently in progress. However, one project, referred to as the FASB Codification, is a "must see" because it is sure to create significant changes for anyone who researches accounting or financial reporting issues.The FASB Codification project is designed to present all of the relevant U.S. accounting and financial reporting literature in a single, authoritative, integrated offering in an online, real-time database. That is, the goal is to provide all generally accepted accounting principles in one location for financial professionals to access and use.

The Financial Accounting Standards Board has agreed to defer the effective date of Interpretation No. 48, "Accounting for Uncertainty in Income Taxes," for nonpublic entities to years beginning after Dec. 15, 2007.

Experts discussed how to share strategies on driving firm profitability and growth at this month's New York Metro Roundtable at the Friars Club in Manhattan.

Michael Oxley, the former chairman of the House Financial Services Committee who co-sponsored the Sarbanes-Oxley Act of 2002, has joined the International Advisory Council of APCO Worldwide, a consultancy that specializes in corporate communications.

Andrew McKelvey, the former CEO of job listing provider Monster Worldwide, has agreed to pay $275,989.72 to the Securities and Exchange Commission to settle charges of stock options backdating.

The Internal Revenue Service said it has increased its enforcement efforts, auditing 84 percent more returns in fiscal year 2007 of individuals with incomes of $1 million or more compared to fiscal year 2006.

The Institute of Management Accountants has established a Small Business Financial and Regulatory Affairs Committee to address issues of interest to small companies and their accountants.

The Financial Accounting Standards Board began testing a codification of U.S. generally accepted accounting principles that reorganizes thousands of U.S. GAAP pronouncements to make them easier to find.

Edgar Online and Microsoft announced a deal under which Edgar Online will provide financial filings from the Securities and Exchange Commission's Edgar database and other content to Microsoft's MSN Money, while Microsoft will provide advertising around Edgar Online's content.

Online cash management software developer CashView has changed its name to Bill.com and introduced a new service to help small businesses manage their billings, invoices and payments online.

The Securities and Exchange Commission charged two former employees of PricewaterhouseCoopers LLP with insider trading.

The chief executives of the six largest accounting firms pushed for global convergence of accounting standards, better audit quality and principles-based accounting standards at a symposium.

The Securities and Exchange Commission may be moving toward greater acceptance of the professional judgment of accountants in interpreting financial standards, and that can’t happen soon enough.