Economy

Report Recommends Modifying Proposed Regs. to Address Pension Plan Concerns

Mutual fund investments represent more than 20 percent of Americans’ pension plan assets. Since late 2003, two abusive trading practices in mutual funds have come to light. Late trading allowed some investors to illegally place orders for funds after the close of trading. Market timing allowed some investors to take advantage of temporary disparities between the value of a fund and the value of its underlying assets despite stated policies against such trading.
A&A

New Faces in Bankruptcy Court: The Middle-Aged

Just when many baby boomers expected to be settling into their comfortable homes earned from a lifetime of hard work, they’re finding themselves in bankruptcy court instead.The reasons are numerous; the circumstances complicated. Bankruptcy attorneys are accustomed to helping young people who have overextended themselves with credit card debt and the expenses of starting a new home and family. The faces they see now, however, are lined with a history of hard work and the burden of caring for both their children and their parents.
A&A

Franklin Advisers to Pay $50 Million; Undergo Compliance Reform

The Securities and Exchange Commission this week announced that Franklin Advisers, Inc., an investment adviser firm in the fourth largest mutual fund complex in the U.S., has agreed to pay $50 million dollars and undergo compliance reforms to settle charges that it allowed rapid in-and-out trading, known as market timing, in mutual funds it managed, contrary to fund prospectus language. Under the settlement, Franklin will pay $50 million, including disgorgement of $30 million and a civil penalty of $20 million.
Community News

Proposed Changes Would Modernize NYSE Trading

In an effort to modernize the New York Stock Exchange, chairman John Thain is proposing the use of computers to speed up the 212-year-old auction system, the Wall Street Journal reported.Thain's plan, which had been expected for some time, may not go far enough in addressing demands for change from mutual fund companies and other investors, who had threatened to flee toward the Nasdaq and other fully computerized markets unless the NYSE modernized it's trading, the Journal reported.The Big Board's proposal, which is subject to Securities and Exchange Commission approval, would combine th
Tax

IRS Statistics of Income Released; Includes IRA’s and Tax Rates

On Monday, the Internal Revenue Service announced the release of the Spring 2004 issue of the Statistics of Income Bulletin, a quarterly compilation of information on selected topics from tax returns and other sources. For the first time, the Bulletin takes a detailed look at individual retirement arrangements. At the end of 2000, 46.3 million taxpayers held IRA accounts worth a total of $2.6 trillion in fair market value. The bulk — $2.4 trillion, or 91.5 percent — was invested in traditional IRA plans, which have been available for the longest amount of time.
A&A

The 10 Worst Credit Mistakes You Can Make

Used properly, credit cards offer significant safety and convenience benefits. But mistakes with credit can cost dearly -- in time and money and in terms of credit rating. To help consumers avoid costly credit card errors, the Texas Society of Certified Public Accountants highlights the most common credit card mistakes and explains how to avoid them.Mistake 1: Not shopping around for the best interest rate. Credit card rates and terms vary greatly. Financial publications and the Internet are good sources to find the best credit card options.

Study Shows Companies Underestimate Cost of Leaves of Absence

While nearly all larger companies (96 percent) have formal documented leave of absence (LOA) policies, fewer than two in 10 calculate costs associated with them and only one-third track leave utilization, according to a recent study from Hewitt Associates.
Tax

Senator Snowe Introduces Bill to Expand Cash Accounting

U.S. Senator Olympia J. Snowe (R-Maine), chair of the Senate Committee on Small Business and Entrepreneurship, has introduced the "Small Business Cash Accounting Act of 2004," a bill to simplify the tax code and reduce compliance burdens placed on small businesses by permitting businesses that generally earn less than $10 million during the tax year to use cash accounting methods to report their income. Snowe's bill, S.

Marginal Salary Raises Reflect Cautious Times

The economy may be picking up, but cautious employers are granting only marginal pay increases and don’t plan to do much more than that in 2005, the Associated Press reported.Two recent surveys found that on average, companies are planning for salary increases of 3.3 percent to 3.5 percent this year, which makes this the third consecutive year when average raises fell below the 4 percent or more level that was commonplace in the 1990s.
Technology

New Hampshire Pondering Extending Internet Taxes; A Trend to Watch

New Hampshire tax officials are considering a new 7 percent tax on many Internet services, including chat rooms and voice mail, the Associated Press reported.The state’s Department of Revenue Administration is holding a hearing on the matter, which would need legislative approval.
Tax

States All Over the Map with Consumption Taxes

When it comes to the consumption taxes that fund much of state government -- general sales taxes and the excise taxes on gas and cigarettes -- America is a study in contrasts, according to an annual survey of these taxes by CCH Tax and Accounting (CCH)."Aside from generally low cigarette taxes in tobacco-growing states, there seems to be little pattern to the way states tax consumption," said Ken Traisman, J.D., state tax analyst for CCH.

Grocery Chain Makes Workers the Watchdogs Over Rising Health Costs

If employees feel a financial pinch every time they go to the doctor, get an MRI or replace a crown, they will be more conscious of slowing the growth of medical costs.At least that’s the theory behind a new health plan offered by the Whole Foods Market Inc. grocery chain, one of the companies turning to so-called "consumer-driven" medical coverage to save money, the Wall Street Journal reported.The upside is no premiums. After a few months on the job, employees are covered. The downside is high deductibles — $500 for prescriptions and $1,000 for all other medical costs.
A&A

SEC Says Mutual Funds Must Have Independent Chairmen

After a vigorous debate, the Securities and Exchange Commission squeaked through a rule change that will require mutual-fund companies to have independent chairmen.The changes approved Wednesday, on a 3-2 vote, will also require 75 percent of fund seats be filled with independent directors, who must hold meetings separate from fund management, the Wall Street Journal reported.
Tax

House, Senate Face Challenges in Reconciling Dueling Bills

It’s going to be a long, hot summer in Washington as Senate and House negotiators try to reach compromise on two different bills that repeal illegal tax breaks, among other things.The House bill, approved 251-178 yesterday, would repeal the Extraterritorial Income regime, which grants breaks to U.S. exporters. The World Trade Organization has ruled the regime an illegal subsidy and has allowed the European Union to retaliate by levying punitive tariffs on U.S. goods, the Wall Street Journal reported.To compensate U.S.
Practice Management

Two Strikes and You're Out ... for Poor Customer Service

A recent survey commissioned by Amdocs finds that consumers 'will not take it anymore' and are likely to change service providers after two negative experiences. The national survey, which queried 1000 consumers about recent experiences in the banking, cable, retail, and telecommunications industries, shows that consumers hold companies accountable for poor customer service.
A&A

Beware of Medicare Drug Discount Card Fraud

As the new Medicare drug discount card program begins this week, Medicare consumers should be aware of three common frauds including identity theft and "bait and switch" tactics, according to the Foundation for Taxpayer and Consumer Rights. "Seniors should read the fine the print of drug discount card contracts and watch for fraud and identity theft," said Jerry Flanagan of the Foundation for Taxpayer and Consumer Rights (FTCR).
Tax

Enron Traders Gloat over Misdeeds During California Power Crisis

Taped telephone conversations among Enron traders reveal open discussions about manipulating the California power market, taking generating units offline to raise prices and even stealing from grandmothers.A utility outside of Seattle obtained the audiotapes from the Justice Department, which is investigating Enron’s part in the electricity market crisis that brought blackouts and skyrocketing prices to California in 2000-2001. The Snohomish County Public Utility District is suing Enron, saying it was overcharged during the crisis and should receive refunds.
Education & Careers

Accounting and Finance Job Hiring Expected to Increase in Third Quarter

Chief financial officers (CFOs) surveyed for the Robert Half International Financial Hiring Index anticipate a net four percent increase in the hiring of accounting and finance professionals during the third quarter, down two points from the second-quarter forecast but up four points from hiring projections made this time last year.
Tax

Utah Ranks Number One in U.S. Tax Exemptions

In what state will you find the largest families? Utah? That’s right, 19 Utah counties make the list of the top 50 nationwide in the average number of exemptions claimed per federal tax return, according to a new Syracuse University report.The Salt Lake Tribune reported that the Syracuse study, which is based on 2002 returns, showed Utah having more counties in the top 50 than any other state.
Technology

Treasury Releases Report On "Phishing" Identity Theft Prevention

Assistant Secretary of the Treasury, Wayne A. Abernathy, announced this week the release of a new report on the rapidly growing cyber-crime known as “phishing”. “When President Bush signed legislation giving consumers and law enforcement important new tools to fight the spread of identity theft, he sent a message to identity thieves that their schemes would not be tolerated.

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