Accounting standards

With a proposal that would let companies opt to report selected financial instruments at fair value, the Financial Accounting Standards Board has opened the possibility of a significant move toward more fair value measurement.The board has issued the proposal as an exposure draft in hopes that comments will support it as a reduction in the complexity of accounting and in volatility in earnings.

Retail drugstore chain CVS Corp. said the Securities and Exchange Commission has launched an informal probe into how the company accounted for a 2000 transaction.

After 16 years, the executive director of the Securities and Exchange Commission will step down to pursue opportunities in the private sector.

The Securities and Exchange Commission and the Financial Services Authority, the regulator of financial services providers in the United Kingdom, have signed an agreement to increase cooperation in market oversight and supervision.

The Securities and Exchange Commission is seeking public comment on the Public Company Accounting Oversight Board's proposed ethics and auditor independence rules concerning independence, tax services and contingent fees.

The U.S. Chamber of Commerce said that the Securities and Exchange Commission is overstepping its bounds in seeking to punish corporate wrongdoing.

The Securities and Exchange Commission announced a series of roundtables that will be held throughout the year, with a focus on speeding the implementation of new Internet tools to help provide investors and analysts with better financial information about companies and funds.

Online fraud and the use of the Internet to perpetrate insider trading, market manipulations and other securities violations will be the focus of the Securities and Exchange Commission Historical Society's first "Fireside Chat" for 2006.

Kroger Co., the largest supermarket company in the country, will restate its earnings for the past three years for errors in accounting of deferred taxes.

The Securities and Exchange Commission Advisory Committee on Smaller Public Companies has published an exposure draft of its final report, outlining changes to the Sarbanes-Oxley Act for micro-cap and small-cap public companies.

After halting subpoenas issued to two Dow Jones & Co. columnists on Feb. 7, the Securities and Exchange Commission announced that its staff is preparing guidelines for demanding information from journalists.

The Auditing Standards Board of the American Institute of CPAs has approved eight new statements on auditing standards, collectively referred to as the risk assessment standards.

The head of the Securities and Exchange Commission said that he was not consulted before his agency's enforcement division subpoenaed two writers for Dow Jones & Co.

The California Board of Accountancy has agreed to ease adopted practice privilege requirements in the state that went into effect Jan. 1.

The Financial Accounting Standards Board has issued a proposal providing companies with the option to report financial assets and liabilities at fair value.The board said that the change is aimed at simplifying accounting, as well as reducing the earnings volatility caused by differences in existing accounting rules. The new standard would allow companies to measure financial assets and liabilities at fair value selected on a contract-by-contract basis.

A memo out of the Internal Revenue Service's Office of Chief Counsel makes the case that gender reassignment surgery cannot be deducted as a medical expense for tax purposes. The case, involving male-to-female gender reassignment surgery, is currently under consideration by the IRS Office of Appeals.The advice memorandum says that the taxpayer deducted an unspecified amount in expenses - including payments for various doctors, hormone treatments, psychotherapy, health insurance, transportation and lodging in connection with the surgery. Although the taxpayer appears to have offered extensive medical and legal documentation behind the decision to have the procedure, the chief counsel opinion offers legal support for the original IRS revenue agent defining the procedure as cosmetic.

Investors are increasingly seeking creative transaction structures to cash in on the heated real estate market.A strategy that uses preconstruction contracts in Section 1031 like-kind exchanges is one way that is gaining acceptance among investors, especially in areas with heavy condominium development.

Every year, Congress and the Internal Revenue Service help us justify a tax preparer's worth to clients by throwing a few new curves into the tax return preparation process. The 2005 tax return filing season is no exception.This year Congress even threw a few curves at the IRS and commercial tax software creators by passing year-end tax legislation with an impact on 2005 returns after the IRS had already done much of the work on its tax forms for the filing season. Here are some items to watch out for as you work through the 2005 return filing season.

Speaking at a Council on Foreign Relations forum in New York a day after the advisory panel's decision, f our former chairmen of the SEC all argued against exempting any companies from the internal controls provisions, according to reports.

After more than two years of legal maneuvering, the Securities and Exchange Commission settled the last of its charges in its investigation of Xerox Corp.'s alleged earnings manipulation.