International

EU Strikes Back Against Proposed PCAOB Rule

On April 14, the European Union (EU) promised retaliation for any move by the United States to require European firms to register with new U.S. accounting oversight board. The comment came in a letter by Frits Bolkestein, EU financial services commissioner, to William Donaldson, chairman of the Securities and Exchange Commission (SEC). Mr. Bolkestein wrote that if the United States moves ahead with the proposed rule, the EU would require U.S. firms to register with all 15-member EU nations. In the letter, Mr.
Tax

New U.S. - U.K. Tax Treaty Eliminates Dividends Withholding

This week, Treasury Secretary John Snow and Tony Brenton, the United Kingdom’s Acting Ambassador to the United States, announced that a new income tax treaty between the two countries would go into effect starting April 1. Mr. Brenton commented that the agreement’s start date coincided with the start of the tax year in the United Kingdom. According to Mr. Snow, the purpose of the treaty is to eliminate tax barriers and promote cross-border trade and investment.
Education & Careers

Financial Testing Giant Kaplan, Inc. Expands to UK, Asia

Kaplan, Inc.
Community News

Deloitte Quits HLS Audit After Backlash From Protesters

Big four firm Deloitte & Touche has ended its auditor relationship with London-based animal testing firm Huntingdon Life Sciences after being targeted by animal rights activist groups for its association with Huntingdon. A Deloitte insider allegedly gave the names, home addresses, mobile phone numbers and e-mail addresses of as many of 135 Deloitte managers and their secretaries to activist group Stop Huntingdon Animal Cruelty (SHAC).
Community News

E&Y Faces $2.2 Billion Swiss Lawsuit

The trend of suing accounting firms continues, this time in Switzerland.

Accountants Lobby For Cap on Liability Claims in Europe

Legal negligence claims against the Big Four firms threaten to decrease that number to the Big Three or less, according to David Devlin, President of the European Federation of Accountants. With that concern, Devlin is leading a charge to lobby the European Union for caps on claims against accounting firms, according to an article in this week’s Financial Times.The model for the liability cap should be a multiple of a firm’s audit fees, according to Mr. Devlin, who is also a partner at PricewaterhouseCoopers.
Community News

KPMG is First of Big Four to Face Chinese Court

For the first time a Big Four accounting firm faces a lawsuit in mainland China. The legal action was brought by a Jinzhou Port Co. shareholder who has sued the company and KPMG alleging she lost money due to falsified financial statements.Accounting problems surfaced at Jinzhou Port Co. in 2001 when an audit conducted by the Ministry of Finance produced information about inflated revenue and assets and understated costs at the company. Last year Jinzhou issued revised financial statements for 1996 to 2000 showing a change of 367.18 million yuan or approximately US$44 million.

Accounting Group Speaks Out on Canada's Federal Budget

Press ReleaseCanada’s Chartered Accountants expressed disappointment about the depth and breadth of program spending in Canada's federal budget and that so little attention is being paid to the federal debt."We have concerns that the amount of program spending and the rate of increase in spending, forecast over several years, doesn't afford the government enough flexibility should revenue or economic growth slow," said Pierre Brunet, FCA, Chair of the Canadian Institute of Chartered Accountants (CICA) Board of Directors.

Convergence on International Reporting Standards Moves Closer

The results of a new research study out this week reveal that an overwhelming majority of countries - 90% - have plans to converge with International Financial Reporting Standards, but many obstacles still lay ahead.
Practice Management

Business Leaders Begin Preparing For War

February 14, 2003 is a pivotal day in the timeline of world economic stability. As war becomes seemingly inevitable, and the risk of terror attacks increase, business leaders around the country are addressing what they need to do to be prepared.
Community News

E&Y 'Vindicated' in $4.5 Billion Law Suit

Ernst & Young breathed a sigh of relief this week as a judge threw out two out of three of the claims made against it in a negligence case brought against the Big Four firm by Equitable Life. If successful, the suit could have cost the accounting firm $4.5 billion in damages. Last month, AccountingWEB reported that British-based Equitable Life had brought a lawsuit against E&Y claiming that negligence on the part of the auditors led to the near collapse of the 240-year old insurer.

Big Firms Test SEC's Tolerance For New Audit Opinions

Last month, several large accounting firms began adding disclaimers to their audit opinions for UK clients in an effort to ward off lawsuits. Observers say these opinions will provide a real test of the tolerance of the U.S. Securities and Exchange Commission for non-U.S. customs and laws.
Community News

Ernst & Young Faces Off With Equitable Life

Big Four firm Ernst & Young may need some life insurance of its own as it argues in the courtrooms of England that it is not responsible for the near collapse in 2000 of 240-year-old Equitable Life, Britain's oldest life insurer.Equitable ran into trouble last year over guaranteed annuity policies, which promised holders a definite return. A court ordered the company to honor policies sold in the 1970s and 1980s when interest rates were high.

International Auditing Standards Available For Free

The International Federation of Accountants (IFAC) has provided the accounting world with a New Year's gift. Beginning this week, all documents issued by IFAC and the International Auditing and Assurance Standards Board (IAASB) are now available for immediate download at no charge.

SEC to Host Roundtables on Global Impact of Rule Proposals

The U.S. Securities and Exchange Commission will host two interactive roundtable meetings to discuss the international impact of proposed rules on auditor independence and attorney conduct.Both meetings will be held on Tuesday, December 17th and will be webcast from the SEC's headquarters in Washington DC. The auditor independence session will start at 9 am, while the session on attorney conduct will start at 2 pm.

International Exemptions Sought For Sarbanes-Oxley

A delegation from Japan is scheduled to visit the United States this week in an effort to convince the SEC and other enforcement agencies to exempt its accounting firms from certain provisions of the Sarbanes-Oxley Act.In a letter sent to the AICPA immediately after the Act was signed in July, the Japanese Institute of CPAs expressed concern that "the implementation of the Sarbanes-Oxley Act would place U.S.
A&A

FASB Issues 2nd Draft on Accounting for Stock Options

The Financial Accounting Standards Board (FASB) has issued another invitation to comment on stock-based compensation. This one asks for your views on accounting for the fair value of employee stock options.FASB's document provides you with background information in the form of a concise helpful explanation of the similarities of and differences between the international accounting proposal and one of the two types of accounting now permitted in the U.S.
A&A

Hit List Picked For Fast-Track FASB/IASB Convergence

The Financial Accounting Standards Board (FASB) has reached into its vast reservoir of U.S. accounting standards and drawn up a hit list of 17 topics targeted for fast track convergence with international standards. The winning topics in this lottery are not necessarily the U.S.
Tax

Transfer Pricing Shenanigans Hide Billions From IRS

Researchers at Pennsylvania State University and Florida International University have released a disturbing study showing that fake pricing schemes for import-export transactions are defrauding the federal government of well over $50 billion annually.Consider the following: Razor blades imported from Britain for $113 apiece. Tweezers from Japan for $4,896 each. Cut rubies from Burma for $38,192 per carat. And for U.S.
A&A

IASB and FASB Tout Their 'Norwalk Agreement'

Accounting standard-setters and regulators in the U.S. and Europe jointly announced an agreement to stamp out differences in accounting standards. The pact was reportedly made in Norwalk, Connecticut last month by the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB).

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