AccountingWEB Weekly News Wrap-Up - Issue 180


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Industry Profiles

THIS WEEK'S TOP NEWS

  1. SEC Charges KPMG and Four KPMG Partners With Fraud
  2. More Prosecutors Set Their Sights on Auditors
  3. 'Watered-Down' Rules Please Big Firms, Roil Consumers
  4. Andersen Judge Dismisses Nancy Temple, Others, From Lawsuit
  5. Sunbeam's Ex-Auditor And Execs Settle With SEC
  6. IRS Form 2848 is a Must For Military Personnel Being Deployed
  7. Grant Thornton, Community Bankers, Suggest Tax Fixes
  8. DOL Issues Final Rules on 401(k) Blackout Periods
  9. IRS Announces "No Rule" Areas
  10. Consulting Group Analyzes Cause of Financial Restatements

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EDITORIAL

Like most of you and most of your clients, I have been going through my records of last year searching for and organizing everything that is even remotely associated with my taxes. I'm not the shoebox-record type - I tend to have everything filed away in about 20 different folders and I'm constantly looking for ways to fine-tune my system for gathering what I need for my accountant to prepare my taxes.

I was looking through the Tax Organizer worksheets that my CPA sent me this week and had a revelation. In addition to the paperwork to help document what happened last year, wouldn't it be great if my CPA sent me a suggestion for the best way to file my records this year, so that when tax time rolls around in 12 months the "search and find" time is minimized? Or even better, hand me a complete filing system that reflects his idea of "best practice" for taxpayer record retention?

The benefits of this would be that my time is reduced, I would better know all of the pieces of paper I should be keeping, and my CPA would have a much more organized stack of paperwork to review. And if he could do that for each of his clients, the standardization would keep his time and costs down each year. Henry, how about adding that to your suggestion box for next year?

Michael Platt, CEO
AccountingWEB, Inc.
Comments? Submit a Letter to The Editor

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THIS WEEK'S TOP NEWS

1. SEC Charges KPMG and Four KPMG Partners With Fraud

The SEC filed charges against accounting firm KPMG and four of its partners, including the firm's senior technical partner, in connection with the audits of Xerox Corporation from 1997 to 2000.

2. More Prosecutors Set Their Sights on Auditors

There is a growing consensus among prosecutors that crimes would be easier to prevent by going after gatekeepers of capital markets, especially auditors, rather than just prosecuting corporate executives.

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3. "Watered-Down" Rules Please Big Firms, Roil Consumers

Reactions to the new auditor independence rules vary widely. Large accounting firms seem generally pleased. But consumer activists are openly scolding the SEC for watering down the rules.

4. Andersen Judge Dismisses Nancy Temple, Others, From Lawsuit

U.S. District Court Judge Melinda Harmon has released Andersen lawyer Nancy Temple and four other former Andersen partners from the class action lawsuit pending against the former Big Five firm. Nancy Temple is the lawyer whose in-house memo was instrumental in the downfall of the firm.

5. Sunbeam's Ex-Auditor And Execs Settle With SEC

The SEC announced the settlement of its charges against the
audit partner on Sunbeam's 1996 and 1997 year-end financial
statements and the company's former controller and chief
accounting officer.

WE NEED YOUR INPUT

AccountingWEB will once again engage the students of the Beta Alpha Psi Fraternity to assist us with our second annual Student Survey. Last year over 550 students participated in our first annual survey. We will prepare questions based on the issues and hot topics affecting students entering the accounting profession. This survey will be conducted in early spring of 2003 to help understand what steers and influences employment
decisions of today's accounting graduates. What questions would you like to ask potential college graduates? Send your questions and ideas to AccountingWEB Survey

6. IRS Form 2848 is a Must For Military Personnel Being Deployed

If you have military clients or loved ones being deployed, the IRS Form 2848 is a must. The IRS Form 2848 "Power of Attorney and Declaration of Representative" allows a spouse to sign the couple's tax return, easing the way for trouble-free tax filing.

7. Grant Thornton, Community Bankers, Suggest Tax Fixes

The Independent Community Bankers of America, in cooperation with Grant Thornton, has released a comprehensive study outlining a menu of federal tax relief and simplification measures to improve the country's economy.

8. DOL Issues Final Rules on 401(k) Blackout Periods

Beginning this week, workers with 401(k) retirement plans received new federal protection with the Labor Department's announcement of a law requiring plan administrators to provide 30 days' notice of blackout periods.

FREE PIZZA & DOUGHNUT CONTEST

Make sure you enter your firm today for the FREE PIZZA and DOUGHNUT CONTEST from AccountingWEB.com. AccountingWEB would like to sponsor one firm during the upcoming tax season (March 1st through April 15th). We will gladly pay for pizza and doughnuts during the six-week period between March 1 and April 15! Up to a $500 value. Visit the "Contest Rules" page for more information and instructions on how to enter your firm today! Good luck!

9. IRS Announces "No Rule" Areas

The Internal Revenue Service has issued a packet of revenue
procedures designed to clarify areas on which the service will not provide guidance to taxpayers in the form of letter rulings or determination letters. In particular, according to Revenue Procedure 2003-3, the IRS has designated several issues relating to employment and employee benefit plans as "no rule" areas.

10. Consulting Group Analyzes Cause of Financial Restatements

What was really behind all of the financial restatements last year? What kinds of trends can be seen in the causes of these financial restatements? The answers to these and other questions regarding public company financials can be gleaned from Chicago-based Huron Consulting Group's "Analysis of Restatement Matters: Rules, Errors, Ethics, For the Five Years Ended December 31, 2002."

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Q & A FORUM

Visit the Q&A Forum "Member Questions" Page for the most recent questions/answers posted by our subscribers. Add your comments and lend a hand!

1. Comprehensive income is defined as all transactions/events that change the equity of an entity except transactions with owners (as owners). There seems to be a conflict between the definitions of comprehensive income and the presentation of items of comprehensive income.

2. The HRA allows employee participants to carry forward any unused medical reimbursement amounts to the next year. After several years, the employer could be carrying forward a large liability. Has anyone come across more info on HRA's? I've read RR 2002-41 and Notice 2002-45 and they don't address these questions.

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