Audit & Accounting
Employee Tax Audits
The IRS National Research Program’s Employment Tax Audits. It is not uncommon for state and local governments to issue numerous 1099s to employees for work outside of their normal position. For example, police officers working security at events or parks employees working set-up and clean-up at sporting events. Employers also draw scrutiny in how they handle or mishandling the payouts of paid time off. As a result, the IRS National Research Program began conducting Employment Tax Audits. These audits have indicated more noncompliance than anticipated. As such, the IRS will be scrutinizing employers even more heavily moving forward. The reviews impact. Read More.
GASB’s New Pension Standards: Setting the Record Straight
The Governmental Accounting Standards Board’s (GASB) recent pension standards substantially improve the accounting and financial reporting of public employee pensions by state and local governments. The new standards are: Statement No. 67, Financial Reporting for Pension Plans, which applies to financial reporting by most pension plans. Statement No. 68, Accounting and Financial Reporting for Pensions, which applies to financial reporting by most governments that provide their employees with pension benefits. Below are questions and answers that should help clarify common misperceptions about the new pension Statements. 1. Do the new GASB Statements establish requirements for how governments should. Read More.
Reporting Rules for Organizational Actions Affecting Security Basis
Enacted as part of the Energy Improvement and Extension Act of 2008, Section 6045B provides that an issuer of a specified security must file Form 8937, an informational return, with the IRS following an organizational action that affects the basis of a specified security. Additionally, the issuer is required to furnish a written statement with the same information to each holder of the security unless the issuer complies with public disclosure rules. §6045B applies to organizational actions occurring on or after January 1, 2011 by any public or private entity taxed as a corporation for U.S. federal tax purposes, whether. Read More.
Reporting Rules for Organizational Actions Affecting Security Basis
Enacted as part of the Energy Improvement and Extension Act of 2008, Section 6045B provides that an issuer of a specified security must file Form 8937, an informational return, with the IRS following an organizational action that affects the basis of a specified security. Additionally, the issuer is required to furnish a written statement with the same information to each holder of the security unless the issuer complies with public disclosure rules. §6045B applies to organizational actions occurring on or after January 1, 2011 by any public or private entity taxed as a corporation for U.S. federal tax purposes, whether. Read More.
FASB Releases Simplified Guidance for Indefinite-Lived Intangible Asset Testing
The Financial Accounting Standards Board (FASB) recently approved another revision to its intangible assetimpairment testing guidance to simplify how an entity tests indefinite-lived intangible assets for impairment. Previously, annual testing was required and consisted of determining the fair value of the asset and then comparingthe fair value to the carrying value. If the carrying amount was higher, then an impairment loss would be recognized. The update, ASU 2012-02, allows taxpayers to evaluate the likelihood of impairment on a qualitative basis usingsurrounding events and circumstances before having to go through the often costly process of determining the fairvalue of indefinite-lived intangible. Read More.
Update on U.S. GAAP and IFRS Convergence
Since 2002, the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) have been working toward “convergence” of U.S. Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS). Although the two boards have made significant progress to complete their major convergence projects by mid-2011, several are still in progress. Recognizing that convergence will take more time, the European Commission (the European Union’s executive body) recently extended rules that permit European Union–listed U.S. companies to continue to use U.S. GAAP. The rules had expired at the end of 2011, but the European Commission granted a three-year. Read More.