What may possibly have been the most excruciating election campaign in human history ended in early November, allowing a weary nation to move from being uncertain about who would win to being uncertain about what they would do afterward.
Accountants and tax practitioners in particular will be eager to see what Washington plans to do about the many tax-related issues that remain up in the air, from the fate of the Bush tax cuts to the possibility of the country going over the "fiscal cliff." Early signals indicated that "Nothing" was a very strong contender, running neck and neck with "Something, but not anytime soon," thus threatening yet another late-starting and confusing tax season. Brace yourself.
Hurricane Sandy brought disaster to large stretches of the Northeast, but it also brought prompt and, in many cases, heartwarming reactions. Accounting firms reached out to staff and clients; state CPA societies offered resources, support and help with communications to societies in the affected states; and everyone offered as much tax relief and as many extended deadlines as possible. The Financial Accounting Standards Board pushed back a current deadline for comment on its disclosure framework, and the Securities and Exchange Commission offered some extensions for affected filers; and state and local tax authorities offered a variety relief.
Particularly conspicuous was the Internal Revenue Service, which promptly announced deadline relief; issued timely warnings about disaster-related scams; streamlined or waived rules to help tax-exempt organizations get aid to Sandy's victims; and even announced a program whereby its employees can donate time off as cash to qualified nonprofits.
The American Institute of CPAs released an exposure draft of its proposed Financial Reporting Framework for Small- and Medium-Sized Entities. The "other comprehensive basis of accounting" or special purpose framework is aimed at the more than 20 million private U.S. businesses that are not currently required to follow GAAP, with the goal of offering them a "reliable, relevant and simplified financial reporting solution." Comments are due by Jan. 30, 2013.
Separately, at its Fall Meeting of Council, the institute officially installed McGladrey partner Richard Caturano as its new chairman. One of his chief priorities as chairman, he said, will be to promote broader diversity among CPAs, particularly at the leadership level. Besides promoting diversity, Caturano said that the accounting profession must continue to be nimble in its response to globalization, cyber-security concerns, the need to create a better financial reporting framework for private companies, and making the profession more attractive to the best and brightest of the new generation, among other issues.
The IFRS Foundation announced that it was creating an Accounting Standards Advisory Forum of national accounting standard-setters and regional bodies with an interest in financial reporting. FASB is expected to be one of the standard-setters participating in the group, which will be advising the International Accounting Standards Board, but it will be among at least a dozen standard-setters from around the world.
The trustees of the IFRS Foundation have published their own staff's analysis of the Securities and Exchange Commission's final staff report on International Financial Reporting Standards, in an effort to address some of the findings and prod the U.S. into embracing IFRS. The foundation's staff's detailed analysis addresses matters raised in the SEC staff report regarding IFRS as global accounting standards, the IASB as a global accounting standard-setter and the challenges for a U.S. transition to IFRS, including adoption and endorsement matters.
IRS Commissioner Douglas Shulman stepped down in early November, as expected; Deputy Commissioner for Services and Enforcement Steven Millerstepped in as acting commissioner. Shulman's tenure, which began in 2008, was marked efforts to combat international tax evasion and a focus on using technology to both improve service and close the tax gap, but most notably by the introduction of the tax preparer registration regime.
Speaking of which, the IRS opened the renewal period for Preparer Tax Identification Numbers; tax preparers have until December 31 to renew. It also sent off warning letters to preparers whom it suspected of filing inaccurate Earned Income Tax Credit claims, and promised to crack down on refundable tax credits in general.
The staff of the Public Company Accounting Oversight Board put out a set of frequently asked questions relating to issues connected to the implementation of the board's funding rules as they related to brokers and dealers. In particular, the staff FAQ discusses the broker-dealer accounting support fee, and which broker-dealers are required to contribute (primarily, those whose average, quarterly tentative net capital is greater than $5 million).
The Center for Audit Quality released a guide to help auditing firms cope with the Public Company Accounting Oversight Board inspection process. Guide to PCAOB Inspections provides a high-level overview of the PCAOB's process for inspecting public company auditing firms, including the process for selecting and reviewing audits for conformance to audit standards, and the assessment of a firm's audit quality program. It's available for free on the CAQ Web site, www.thecaq.org.
The chairman of the board of directors of the CFP Board of Standards, Alan Goldfarb, and two members of the Disciplinary and Ethics Commission resigned after an investigation over potential violations of provisions of the CFP Board's Standards of Professional Conduct.
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