Accounting standards

The Securities and Exchange Commission and the Public Company Accounting Oversight Board announced the panelists for a May 10 roundtable on Year Two experiences with the internal controls provisions of the Sarbanes-Oxley Act.

The Internal Revenue Service has released updated draft instructions for the new Schedule M-3, filed by large and midsized corporations, and which should be rolled out for the 2006 tax year.

Supermarket chain Ingles Markets Inc. settled charges that it improperly accounted for vendor rebates and allowances with the Securities and Exchange Commission.

The Internal Revenue Service has shifted its enforcement priorities from tax shelters to high-impact tax cheats -- including attorneys and CPAs.

If too many cooks spoil the pot, what do a bunch of auditors from various firms do to an engagement?Don't answer that.

When criticism of the Internal Revenue Service's revision of its more-than-30-year-old preparer disclosure rules first surfaced, it came as an attack from consumer groups outraged that rules were being eased to permit the marketing of taxpayer information.However, contrary to press reports, the IRS said that the proposed rules actually tighten existing requirements regarding the customer consent that a return preparer must obtain to disclose the customer's tax return information to third parties. In fact, explained IRS Commissioner Mark Everson, "For over 30 years, under the law, return preparers have been able to disclose tax return information with the consent of taxpayers."

Code Section 7216 governs the disclosure and use of tax return information by tax return preparers. Late last year, in Notice 2005-93, the Internal Revenue Service issued a proposed revenue procedure purportedly to update the disclosure rules to account for changes in return filing, particularly to account for the growing use of electronic filing and electronic signatures and the foreign outsourcing of tax preparation work.The proposals have set off some apparently unexpected protests from several consumer protection groups, basically concerned that the proposals make it too easy for taxpayers to unknowingly grant permission for disclosure of their tax information.

Government isn't an enterprise. Though it raises and spends money, owns things, has pension funds, works with budgets, and reports to stakeholders, it is fundamentally different from a business. And so its accounting must take a different form and serve a different purpose.Oddly enough, many accounting professionals in the private sector don't even know there's a difference, or if they do, they don't know why.

The Securities and Exchange Commission announced an effort to provide broader and more timely public notice of important actions.

Securities and Exchange Commission Chairman Christopher Cox has said that the agency is leaning towards opening another public-comment period on its stalled governance rules for mutual funds.

In an exchange of correspondence, where the irony couldn't have been not lost on any of the authors, the Government Accountability Office offered 14 recommendations to improve the internal controls of the Securities and Exchange Commission.

The Panel on the Nonprofit Sector, composed of leaders from charitable organizations, has offered additional recommendations to Congress and the nonprofit sector as part of its continuing effort to strengthen the accountability of the nation's 1.3 million charitable organizations.

Reuben E. Price & Co. Public Accountancy Corp., a small firm based in San Francisco, has been censured by the Public Company Accounting Oversight Board for failing to take action after one of the firm's clients issued an annual report that appeared to be, but was not, audited.

The Public Company Accounting Oversight Board announced that the Securities and Exchange Commission has approved the board's recommended ethics and independence rules for auditor independence, tax services and contingent fees.

The International Federation of Accountants has released its 2006 handbook of standards.

The Securities and Exchange Commission announced that the former chief financial officer of discount retailer Dollar General Corp. will pay $1.2 million to settle charges that he engaged in accounting fraud and insider trading.

Tyco International Ltd. will pay $50 million to settle allegations by the Securities and Exchange Commission that the company inflated its earnings by more than $1 billion between 1996 and 2002.

Investors around the globe are demanding that businesses embrace tougher corporate governance standards, according to a survey from research and consulting firm Institutional Shareholder Services.

The U.S. Chamber of Commerce said that the Securities and Exchange Commission is overstepping its bounds in seeking to punish corporate wrongdoing.In a report, the Chamber of Commerce, which lobbies for 3 million U.S. companies and 830 business associations and has been one of the commission's most vocal critics, recommended that the agency appoint an advisory committee to study its enforcement practices.

In the latest turf battle to come to light between the two groups, the American Institute of CPAs and the National Association of State Boards of Accountancy skirmished over NASBA's interest in the details of public company audit inspection reports.In a recent alert sent out from the AICPA Center for Public Company Audit Firms, director Lillian Ceynowa wrote that member firms were not required to comply with inquiries from some state boards requesting the identities of individuals and companies referred to in Public Company Accounting Oversight Board inspection reports.