Bramwell’s Lunch Beat: New Report Outlines Possible Changes to CPA Examby
Twitter names Robert Kaiden chief accounting officer
Twitter Inc. disclosed in a regulatory filing that it appointed Robert Kaiden, 48, as its chief accounting officer, effective June 1, according to RTTNews.com. From 1989 to May 2015, Kaiden served in several roles at Deloitte & Touche LLP, including as audit partner from 2000 to May 2015. Gordon Lee, who has served as Twitter’s interim chief accounting officer, will continue to work as controller for the social media company. Kaiden's base salary will be $350,000, and he will be eligible for an annual discretionary performance bonus of up to 100 percent of his base salary, pursuant to terms of the offer letter.
AICPA issues report on proposed changes in next version of CPA exam
The American Institute of CPAs (AICPA) released a report on Thursday summarizing key stakeholders’ input on potential ways to adapt the next version of the Uniform CPA Examination. The report, Invitation to Comment Results:Maintaining the Relevance of the Uniform CPA Examination, is part of a practice analysis – an extensive research project designed to determine the knowledge and skills required of newly licensed CPAs. The AICPA Board of Examiners and the AICPA Examinations Team reviewed feedback from more than 300 members of the accounting, finance, and academic communities, along with additional research, and agreed on a number of preliminary changes to consider and areas for further exploration. Notable findings include:
- Respondents support the consideration of testing higher-order skills beyond basic content knowledge, such as critical thinking, problem solving, analytical ability, and professional skepticism. The AICPA is exploring increasing its assessment of these higher-order skills throughout each section of the exam.
- Candidates strongly requested additional opportunities to sit for the CPA exam, and the AICPA is exploring extending the testing windows, allowing candidates to retest a failed section within a testing window, and other ways to enhance convenience for candidates taking the CPA exam.
- Members of the profession indicated that the current structure of the exam is appropriate for testing in the fundamental areas of Auditing and Attestation (AUD), Financial Accounting and Reporting (FAR), Regulations (REG), and Business Environment and Concepts (BEC).
- Respondents support the use of Excel in the CPA exam to create an authentic user experience. The AICPA plans to launch a new testing interface utilizing Excel in 2018.
In September, the AICPA plans to distribute an exposure draft for comment, which will serve as a final proposal for the next version of the CPA exam. The research conducted during the practice analysis will inform the development of the next version of the CPA exam, which will be announced in 2016 and launched in 2017.
SEC charges CSC and former executives with accounting fraud
The US Securities and Exchange Commission (SEC) on Friday charged Computer Sciences Corp. (CSC) and former executives with manipulating financial results and concealing significant problems about the company’s largest and most high-profile contract, according to a press release. The SEC additionally charged former finance executives involved with CSC’s international businesses for ignoring basic accounting standards to increase reported profits. CSC agreed to pay a $190 million penalty to settle the charges, and five of the eight charged executives agreed to settlements. Former CEO Michael Laphen agreed to return to CSC more than $3.7 million in compensation under the clawback provision of the Sarbanes-Oxley Act and pay a $750,000 penalty. Former CFO Michael Mancuso agreed to return $369,100 in compensation and pay a $175,000 penalty.
SEC gets statistical in search for median employee’s pay
The SEC on Thursday sought public comment on the impact of excluding certain groups of employees from a ratio of executive-to-average-worker pay required under the 2010 Dodd-Frank financial law, wrote Emily Chasan of the Wall Street Journal’s CFO Journal. The disclosure rule, which the SEC was required to write by Section 953 of the law, is intended to expose the income disparity between a company’s top financial executives and average worker – specifically the median annual total compensation of a company’s employees. In 2013, the SEC proposed that companies could choose a variety of statistical methods to arrive at the pay-ratio figure to save time and expense. But companies with large overseas employee populations, or significant groups of seasonal and part-time employees, say it would be very costly to locate the pay of their median employee if they are required to include all employees. The comment period continues until July 6.
GE mulls moving headquarters after Connecticut tax changes
General Electric Co. is exploring a move from its Connecticut headquarters after it objected to tax aspects of the state's recently passed budget, wrote Jacob Pramuk of CNBC. The Connecticut Legislature on Wednesday approved a $40 billion budget that would increase some business taxes. In a Thursday email provided by GE, CEO Jeff Immelt told Connecticut-based employees that he has put together a team to evaluate a move to another state with “a more pro-business environment.” Immelt claims the company's state taxes have increased five times since 2011 and the new budget would impose “significant and retroactive tax increases for businesses.” Connecticut Gov. Dannel Malloy noted on Thursday that he would consider revising some tax provisions amid backlash from GE and other employers.
Congress to IRS: All hands on deck on tax fraud
Bernie Becker of The Hill wrote that the Senate's top two tax writers told the IRS on Thursday that the government would need an all-hands-on-deck response to battle tax refund fraud. In a letter to IRS Commissioner John Koskinen, Senate Finance Committee Chairman Orrin Hatch (R-UT) and Sen. Ron Wyden (D-OR) wrote: “Due to the complex nature of tax schemes and the large volume of fraudulent transactions, the committee cannot fully address this problem on its own. Any solution must involve coordination between Congress, the IRS, state agencies, law enforcement, and the tax-preparation industry.” Thieves, thought to be from organized crime syndicates, recently stole tax records from more than 100,000 taxpayers off an agency website. Hatch and Wyden said they were pleased to see that the IRS and private tax software companies are close to issuing recommendations on how to combat tax fraud.
GOP lawmaker bashes IRS response to Clinton concerns
Bernie Becker also reported for The Hill that Rep. Marsha Blackburn (R-TN) called out the IRS on Thursday for sending her a form letter in response to concerns about the Clinton Foundation's tax exemption. The IRS's response to Blackburn was addressed to “Sir or Madam,” and the senior agency official who runs the tax-exempt division didn't sign it. To Blackburn, that reply was “lacking in the requisite tact.” She added that it was “unbelievably disrespectful” that Margaret Von Lienen, the senior IRS official, “couldn't even take the few extra seconds needed to sign the letter.” GOP lawmakers urged the IRS last month to investigate the charitable organization of former President Bill Clinton and Hillary Clinton, the former secretary of state and front-runner for the 2016 Democratic nomination. Republicans noted that the Clinton Foundation had failed for years to report millions of dollars in donations from foreign governments, or the Clintons' ties to a Canadian donor and businessman.
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