Accounting standards

The International Auditing and Assurance Standards Board, a unit of the International Federation of Accountants, has approved a revised standard that the governing body says will enhance audit quality via stricter requirements for documentation.

The European Parliament approved the controversial Eighth Directive, a sweeping reform measure that mandates new oversight rules for auditors.

In a ruling that may affect the future of state job creation strategies across the nation, the Supreme Court will rule on how states can use tax incentives to entice large concerns such as car companies to make capital investments.

Without the release of all pertinent documents by San Diego's pension board, attorney's office and firefighters union , auditor KPMG says that its review of the city's 2003 year could drag on even longer.

Securities and Exchange Commission Chairman Christopher Cox will recuse himself to avoid any appearance of impropriety in the agency's investigation of Cox's former congressional colleague, Senate Majority Leader Bill Frist.

The board of trustees of the Financial Accounting Foundation appointed telecomm executive Robert J. DeSantis as president and chief operating officer.

To aid the convergence of International Public Sector Accounting Standards with International Financial Reporting Standards, the International Public Sector Accounting Standards Board has issued a new exposure draft, "Improvements to International Public Sector Accounting Standards."

A new set of proposed regulations from the Internal Revenue Service aims to change the way companies use accounting methods to switch profits from countries with high corporate tax to countries where corporate taxes are low.The regs - all 85 pages of them - create an ambitious regime with a number of nebulous new concepts, including an "investor model," to insure that businesses value intangibles, such as marketing, research and development, and patents, in a way that will maximize exposure to U.S. tax.

The chief accountant of the Securities and Exchange Commission, Donald T. Nicolaisen, will leave the commission in October to return to the private sector.Nicolaisen, 61, joined the SEC under former Chairman William Donaldson in September 2003 and led numerous initiatives to improve financial disclosure, strengthen the audit process and rebuild investor confidence.

In a continuing struggle to keep up with the increasing complexity of financial assets and special purpose entities, the Financial Accounting Standards Board has issued three proposals to amend existing statements that have, in just a few years, become - to some extent - obsolete.The proposals are a response to constituents in various sectors who requested clarifications and simplifications of the technically complex Statement 140, Accounting for Transfers and Servicing of Financial Assets, which was seen as becoming harder to interpret and implement as new kinds of financial assets come into existence, especially in the areas of securitizations and special purpose entities.

Both the Government Accountability Office and the Treasury Inspector General for Tax Administration have some advice for the Internal Revenue Service.On the heels of an IRS decision to focus on S corporations in order to zero in on the compliance problems of small businesses, the TIGTA issued a report calling on the IRS to improve its efforts against employment tax noncompliance. The GAO also weighed in in the same week with its report, "Tax Compliance: Better Compliance Data and Long-term Goals Would Support a More Strategic IRS Approach to Reducing the Tax Gap."

It was a smooth first meeting for Securities and Exchange Commission Chairman Christopher Cox, with the panel voting unanimously to extend the deadline for when small companies will have to have their internal controls documented under Section 404 of the Sarbanes-Oxley law.

The former chairman of Gemstar-TV Guide International Inc. will plead guilty to obstructing a Securities and Exchange Commision investigation into accounting irregularities at the company.

The Public Company Accounting Oversight Board will host a forum in Boston to bring information to the small business community.

Three months after restating its 2004 earnings, stun gun manufacturer Taser International Inc. said it had fired its accounting firm.

Interpublic Group of Companies Inc., which includes several of the world's largest advertising agencies, said in a filing with the Securities and Exchange Commission that it will correct four years of earnings spanning 2000 to 2004.

Merrill Lynch & Co. Inc. announced a new options expensing policy for all U.S. equity research analysts that will be implemented as of the first reporting date after Sept. 30.

The International Federation of Accountants is seeking input for the development of a how-to guide on implementing International Standards on Auditing for small and midsized businesses.

Two technical committees from Financial Executives International have sent a letter making suggestions to the Financial Accounting Standards Board's proposed interpretation, "Accounting for Uncertain Tax Positions."

The Securities and Exchange Commission is expected to give small public companies another extension to comply with the internal control rule outlined in the Sarbanes-Oxley Act, according to published reports.