Government

Tax

Tax Evader Traficant Expelled From Congress

On July 24, the House of Representatives voted 420-1 to oust James Traficant (D-OH). Mr. Traficant has been asked repeatedly by other members of Congress to resign in light of his April convictions on federal charges of bribery, racketeering, and tax evasion, but the colorful Congressman held his ground to the bitter end. Last week, the House Committee on Standards of Official Conduct found him guilty of nine charges of ethics violations and recommended the vote for expulsion. Only Representative Gary Condit (D-CA) voted against Mr.

Lawmakers Agree on Accounting Reform Legislation

U.S. lawmakers reached agreement on accounting reform legislation and sent the bill to President Bush for his signature.
Tax

Treasury Admits Mistake in Naming KPMG's Tax Clients

In a letter to the editor of the Wall Street Journal, Treasury Department General Counsel David D. Aufhauser admitted that prudent measures to protect taxpayers' privacy were not in place when the names of KPMG's clients were revealed by the Department of Justice (DOJ) last week.
Community News

Deloitte to Create Model For Investigating Business Failures

James E. Copeland, chief executive officer of Deloitte & Touche, has announced his firm is assembling a team to develop a model for a new approach to restoring investor confidence. The new approach involves creation of a national board to investigate business failures and recommend steps to prevent similar failures in the future. The concept is reminiscent of a similar initiative for audit failures introduced by the Public Oversight Board in the mid-1990s.
Community News

Congress Pledges Decision Next Week on Accounting Reform

In an abrupt about-face, Rep. Michael Oxley, the sponsor of the House bill on accounting reform, and other influential lawmakers pledged to reach a compromise agreement with the Senate bill by July 26, 2002. This landmark legislation could be the biggest milestone ever in the history of the accounting profession, and positions on the differences between the House and Senate accounting reform bills appear to be changing by the minute.

House Rushes Penalties, Mulls Delay in Accounting Reforms

In an election-year political scramble, the House of Representatives rushed through H.R.5118, a tough reform bill containing criminal penalties for corporate fraud that are even harsher than the ones passed unanimously by the Senate a day before. The man behind the rush, the bill's sponsor, Rep.

Senate Unanimously Passes Accounting Reform Bill

By a vote of 97 to 0, the Senate approved an amended version of S.2673, the accounting reform bill authored by Senate Banking Committee Chairman Paul Sarbanes.This bill will create an oversight board that is empowered to set accounting and auditing standards and fine or ban any individual or firm that violates them.
A&A

Lawmakers Advance Anti-Fraud Rules and FASB Act

On July 10, 2002, as capital market slides reflected a continuing erosion of investor confidence, lawmakers in both the House and Senate made progress on accounting reforms.
Community News

Rating Agency Initiates Report Cards on Auditors

Weiss Ratings, a rating agency whose revenues come from consumers rather than the companies it rates, prepared a report on the role of auditors in the worsening crisis of confidence on Wall Street and sent it to the Senate. The paper contains report cards on major audit firms, and it suggests that similar reports be prepared and disclosed to the public in the future.

President Bush Plans to Move Accounting Out of The Shadows

Speaking to business leaders on Wall Street on July 9, 2002, President George Bush called for a new ethic of responsibility in Corporate America, consisting of truthful books, honest people and well-enforced laws against fraud and corruption.

GAO Announces New Compliance Date For Independence Rules

Accountants subject to the new auditor independence rules issued by the General Accounting Office (GAO) earlier this year have been given a small reprieve.

GASB Issues ED on Disclosures About Investment Risks

On July 1, 2002, the Governmental Accounting Standards Board (GASB) released an exposure draft (ED) designed to provide the public with better information about the risks that could potentially impact a government's ability to provide services and pay its debts.Entitled "Exposure Draft, Deposit and Investment Risk Disclosures," the ED resulted from the first project in GASB's comprehensive review of its existing accounting standards after recent Federal banking reforms. GASB Project Manager Randal J.
Community News

Andersen Staffers to Find New Home at KPMG Consulting

KPMG Consulting has announced that it has signed a definitive agreement to hire 140 partners and 1,400 staff of Andersen Consulting's U.S. operations.When the deal goes through, expected later in July, KPMG Consulting will pay Arthur Andersen LLP $63 million for the acquisition of the practice.
Tax

Senate Finance Committee Approves Trio of Tax Bills

The Senate Finance Committee recently approved a trio of bills that could affect a broad spectrum of tax work done by accounting firms today. The first bill (H.R.7) would provide tax breaks for charitable donations to help ease the tough times faced by many American charities due to the events of September 11th. These tax incentives would be partially funded by the other two bills, which include one on tax shelters (S.2498) and another on corporate inversions, a way to avoid taxes by reincorporating in an offshore tax haven (S.2119).

Audit Reform Plans May Leave GASB Out in The Cold

Speaking at the 96th annual conference of the Government Finance Officers Association (GFOA), Tom L.
Community News

BDO Seidman Nears End of Case Involving Criminal Charges

On Monday, June 24, 2002, BDO Seidman will take another step toward removal of the criminal charges facing the firm. This is the date when a federal judge is scheduled to determine the formula for compensating the victims in the firm's failure-to-report-an-illegal-act case.

GAO Releases Report on The Accounting Profession

On June 19, 2002, the General Accounting Office (GAO) released to the public its "Report on the Accounting Profession." The document was prepared at the request of Representative John Dingell, the ranking minority member of the House Energy Committee. He asked for a report during post-Enron Congressional hearings. The purpose of the GAO's report was to determine the status of recommendations made in 2000 by the Panel on Audit Effectiveness. The panel was appointed by the Public Oversight Board in 1998 in response to a request from the Securities and Exchange Commission (SEC).
Community News

Andersen to Appeal Unusual Trial And Jury Verdict

Arthur Andersen announced it will appeal the decision in its obstruction-of-justice case. Andersen's attorneys said the jury's thinking was unusually narrow, and the decision could affect scores of other firms and clients. In reaching their decision, the jurors excused the wider issue involving shredding of documents and ignored the guilty plea of former Enron audit partner David Duncan. Instead, the jury found the firm guilty because Mr.
Tax

Constitutional Amendment Would Require Supermajority For Tax Hikes

Provided by CCHThe House on June 12 plans to vote on an amendment to the Constitution that would require a supermajority in Congress to change tax laws or significantly increase government spending. The Tax Limitation Constitutional Amendment (HJRes 96) was introduced by Rep. Pete Sessions, R-Texas, on June 6.
Tax

IRS Web Site Wins National Award

If you've been impressed with the new look of the Internal Revenue Service's Web site at www.irs.gov, you're not alone. The site, which has received more than 2 billion hits since last October, will receive the Pioneer Award from e-Gov later this month. The Pioneer Award recognizes innovative approaches to improving products and services.The e-Gov exposition is being held in Washington D.C. on June 24 through 27, and the event will feature a best-practice briefing and an information kiosk hosted by the IRS.

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