AccountingWEB Weekly News Wrap-Up - Issue 141
April 12, 2002
This News Wrap-Up Sponsored By:
NEWS FOR ACCOUNTINGWEB MEMBERS
1. Andersen to Lay Off 7,000 Employees
2. New Report: Filing Mistakes Cost Taxpayers $1 Billion a Year
3. House Set to Reconcile Competing Audit Reform Bills
4. Andersen's Duncan Pleads Guilty
5. Enron Shareholders Target Banks, Lawyers
6. Panel Wants SEC to Lead Accounting into Internet Age
7. Xerox to Pay Record Financial Fraud Penalty, Investigation Turns to KPMG
8. IRS Suspends Requirement to File Schedule F of Form 5500
9. H&R Block Offers No-Interest Loans to Cash-Strapped Customers
10.Wall Street Journal Gets a New Look
Ah, April 15, 2002 - It's down to the wire folks, and the final sprint is here at last for thousands of our members across the country. Many of you have been occupied with tax return preparation over the last few months and we are looking forward to your return, no pun intended.
The "I"s are dotted, the "T"s are crossed and everything is (hopefully) out the door with the correct forms attached and the correct address on the envelopes. We raise a glass to all of you for another successful tax season, and wish you a much-needed rest so you can regroup and then get back to the business of business. Congratulations all . . .
NEWS FOR ACCOUNTINGWEB MEMBERS
Big Five firm Andersen announced plans to cut its U.S.
workforce by 25 percent. The firm will cut approximately 7,000
personnel over the coming months.
Other Related News:
A number of significant developments have emerged in the
continuing Andersen story this week. Among the top headlines:
For a complete perspective of the entire Andersen story since the
Enron saga broke, go to:
To individuals who are not tax professionals, navigating the world of itemized deductions is a confusing, cloudy process of rules, loopholes, opportunities, and landmines. As such, taxpayers do not take advantage of the opportunities afforded them by the law, and end up overpaying by a collective $1 billion in federal taxes, according to a new report issued by the General Accounting Office.
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On April 9, 2002, the House Committee on Financial Services held its final hearing on proposed legislation for accounting and auditing reforms. Witnesses were asked to compare the merits of two major bills now under consideration, the Oxley bill and the LaFalce bill, as a final step before the next drafting session on April 11th. Much of the testimony focused on the role of the accounting oversight board.
In a statement filed with the U.S. District Court in Houston, Enron's lead auditor, David B. Duncan admitted that he persuaded co-workers to shred documents to thwart the government's investigation into the Enron collapse.
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Members of the class action suit who are hoping to recoup lost retirement funds from now-defunct Enron Corporation amended their suit in Federal court Monday to include several investment banks, securities firms, and law firms. Led by lead plaintiff the University of California Board of Regents, thousands of Enron shareholders are participants in the suit.
On April 4, the Securities and Exchange Commission hosted a roundtable in Chicago to find out how best to improve financial disclosures. The participants represented key occupations and associations that typically take a back seat in the setting of accounting standards. Their nearly unanimous conclusion: the SEC should take the lead in bringing accounting and financial disclosures into the Internet Age.
The SEC has informed representatives of KPMG about the possibility of leveling charges against them as part of an expansion of the civil case filed this week regarding accounting fraud at Xerox. Xerox agreed to a settlement in the SEC's investigation that will, among other penalties, inflict a $10 million fine on the copier company – the largest financial fraud penalty ever against a public company.
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Effective immediately, the Internal Revenue Service has indefinitely suspended the requirement for taxpayers to file Schedule F of Form 5500, "Fringe Benefit Plan Annual Information Return." This is part of the agency's ongoing commitment to reduce unnecessary taxpayer burden.
In a continuing effort to find ways to secure the loyalty of its customer base, H&R Block has announced that it is offering 90-day no-interest loans on amounts ranging from $300 to $5,000 to help its customers who owe money to the IRS.
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On April 9, readers of the print editions of the U.S. Wall Street Journal were treated to a new look for the first time since 1942. Many loyal readers loved the paper the way it was, and the Journal was careful to keep its trademark line drawings in their traditional black and white. Through an advertising campaign featuring rejected redesigns, the Journal emphasized its conservatism and its deliberate attempt to avoid making changes that would be perceived as too radical.
ACCOUNTINGWEB Q&A FORUM
Visit our Q&A Forum to post your questions and share your ideas with the members of AccountingWEB! Simply click on the "Add Comments" option at the bottom of any question to add your response and comments.
Here is a sample of the questions that have been posted this week. Post your own questions or see if you can lend a hand to others looking for help.
1. Excel Macros: Can a macro be written that adjusts margins on a group of consecutive sheets with one run of the macro?
2. Depreciation: The depreciation charged every month on a company's books is $35,000. This year, assets have been revalued and the depreciation has gone up to $50,000. In the same timeframe the company has reduced manpower by 20% and the machinery usage has gone done respectively. The total capacity (output) of the factory is affected. Is there a way to reduce the cost by depreciation?
3. What is the best way to handle personal items paid by a C corporation (small, one owner)? Can the total of these items be considered a management fee and entered on Schedule C of the 1040 or as additional salary on the 1040?
4. C-Corp Buy or Rent Home from Shareholders for Office: Husband & wife shareholders own a home, and are soon to build new home. Should they sell the old home to their C-corporation for corporate office, or rent it to the corporation? Taxpayers qualify for sale of home exclusion now, or they could use it 2-3 years from now.
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