Gallup poll: Americans believe IRS has recovered from targeting scandal
A recent Gallup poll shows that the public’s perception of the IRS has improved more than a year after the agency was battered for targeting conservative groups that were applying for tax-exempt status.
The poll of more than 1,000 adults, which was conducted Nov. 11 and 12, found that 41 percent of respondents rated the IRS’s job performance as “excellent or good.” Twenty-nine percent of respondents rated the agency’s job performance as “fair,” while 27 percent characterized it as “poor.”
After the targeting scandal came to light in May 2013, the agency’s job ratings fell from 40 percent excellent or good in 2009 to 27 percent.
Survey: Strategic planning tops list of CFO priorities for 2015
CFOs and financial executives will continue to focus on strategic planning and working capital capabilities in 2015, according to the results of a new report recently released by global consulting firm Protiviti and the Financial Executives Research Foundation (FERF).
More than 370 financial executives and professionals were polled during the third quarter of 2014 for the Finance Priorities Survey: The Rising Tide of Finance Challenges. According to the report, the top financial analysis priority for the coming year was strategic planning, which received a score of 7.2 on a scale of 1 to 10, followed by budgeting (7.1) and periodic forecasting (7.0).
“Amid a changing operating environment, companies are now placing an increased emphasis on the holistic alignment of their strategy, risk management capabilities, and performance management processes,” Ryan Senter, a managing director with Protiviti’s Business Performance Improvement practice, said in a written statement. “Rather than applying patchwork fixes to individual processes, finance functions want to manage and improve related processes in a comprehensive manner to ultimately improve overall corporate performance management.”
CFOs also prioritized the financial transaction functions for 2015. Period-end close topped the list, followed by cash forecasting and account reconciliations. Bill Sinnett, FERF senior director of research, said enterprise resource planning, general ledger, and consolidation systems “have dramatically reduced human errors and processing delays, but the processes of reconciling and closing a company’s books at local and group levels continue to burden the finance function.”
Survey respondents also were asked to rank issues they believe pose new risks, challenges, and opportunities for finance functions. Sustainability received the highest score at 6.4, followed by changes to US healthcare regulations (6.3) and the new revenue recognition accounting standard (5.8).
The report states that as sustainability throughout the enterprise evolve, finance functions “are playing a greater role in supporting these efforts, from both reporting and analysts perspectives.”
Survey: CFOs taking on expanded roles, including IT
In another recent CFO survey, this one from Robert Half Management Resources, more than eight in 10 finance executives surveyed said over the past three years their roles have expanded outside of traditional accounting and finance, with human resources (HR) and IT the most commonly cited areas.
The survey, which was developed by Robert Half and conducted by an independent research firm, is based on interviews with more than 2,100 CFOs from a random sample of companies in more than 20 of the largest US markets.
CFOs were asked, “Which one of the following areas outside of traditional accounting and finance responsibilities, if any, has your role expanded into most over the past three years?” The following were their responses:
- HR (21 percent)
- IT (19 percent)
- Operations (18 percent)
- Marketing (17 percent)
- Sales or business development (10 percent)
- None/role hasn’t changed (14 percent)
- Don’t know (1 percent)
“While tackling increased compliance and regulatory pressures, internal controls, and tax issues, today's CFO also is a strategic and indispensable business adviser,” Paul McDonald, senior executive director for Robert Half, said in a written statement. “With technological advancements and the emphasis on data analytics and business transformation, companies are looking to their financial leaders to partner with departments throughout the organization, including HR and IT, to help enhance efficiencies, grow revenue, and contain costs.”
McDonald attributed CFOs’ increased involvement in HR, in part, to the competitive hiring environment.
“Financial executives are often collaborating with HR on benefits and other areas that not only affect a firm’s bottom line, but also its ability to attract and retain leading employees,” he said.
Retiring Camp on tax reform: ‘It can be done’
In an interview with The Hill last week, retiring House Ways and Means Committee Chairman Dave Camp (R-MI) said priming congressional Republicans for the difficulties of tax reform could be one of the bigger legacies of his four years atop the powerful committee.
Camp released a tax reform discussion draft in February, which pared back even the most popular of tax breaks. House Speaker John Boehner (R-OH), a longtime friend of Camp, famously responded to the draft with a “blah, blah, blah, blah.” Rank-and-file House Republicans wondered aloud why the GOP would propose rolling back popular policies in an election year, wrote Bernie Becker of The Hill.
But Camp said his discussion draft – crafted after more than three years of work – showed that “it can be done. I think a lot of people thought it was really hard to do.”
On his way out, Camp said he was disappointed that his push for tax reform didn’t get further and maintained that the recent pattern of Congress careening from crisis to crisis over matters like the debt ceiling didn’t help his odds of making progress on revamping the tax system.
But he also insisted that he didn’t regret going all-in on overhauling the tax code. “You plant a flag and hope you can get across the finish line,” Camp said, according to the article. “I’m very pleased that a discussion draft was completed. Would I have liked to get it across the finish line? Absolutely.”
IRS technical guidance roundup (week of Nov. 24)
The IRS issued the following technical guidance last week:
Notice 2014-74 amends the two safe harbor explanations in Notice 2009-68, 2009-2 C.B. 423, that can be used to satisfy the requirement under Section 402(f) of the Internal Revenue Code that certain information be provided to recipients of eligible rollover distributions. Amendments to the safe harbor explanations reflected in this notice relate to the allocation of pre-tax and after-tax amounts, distributions in the form of in-plan Roth rollovers, and certain other clarifications to the two safe harbor explanations. The amendments to the safe harbor explanations (and attached model notices) may be used for plans that apply the guidance in Section III of Notice 2014-54, 2014-41 I.R.B. 670, with respect to the allocation of pretax and after-tax amounts.
Group of 11 EU nations to miss deadline for tax on financial trades
Huw Jones of Reutersreported that 11 European Union (EU) countries are unlikely to agree on a tax on financial transactions by the end of year, an EU document showed on Monday, dealing a political blow to the French and German governments that have pushed it.
The proposal has been dubbed the “Robin Hood” tax after the legendary English outlaw who robbed from the rich to give to the poor.
The aim is to force banks to pay for the public aid they received in the 2007-09 financial crisis by taxing them on every trade they execute in stocks, bonds, and other financial instruments. Most EU states, including Britain, its biggest trading center, have declined to join the group, saying that banks would end up passing the cost to investors.
The latest document from Italy, which holds the EU presidency, lists the group's disagreements and makes no mention of any compromise proposal, adding that “further work will be required,” Jones wrote. Ambassadors for the bloc's members will review the document on Wednesday. An EU official said no compromise would be proposed for agreement, meaning there will be no deal this year.
Supporters of the tax, which include Belgium, Spain, Italy, and Portugal, want to tax trades that involve shares and some derivatives from January 2016 at the latest, two years later than planned. They agree that shares in companies traded on stock markets should be taxed and how unlisted shares, typically held by family members in small companies, could also be taxed, according to the article.
China to monitor foreign company profits to prevent tax evasion
China will set up a system to monitor foreign companies’ profits as it looks to eliminate cross-border tax evasion, according to a Bloombergarticle on Monday.
China will seek to have a “full grasp” of the profit levels of foreign companies to stop them from moving their profits out and eroding the tax base, according to a statement posted on the State Administration of Taxation website on Monday, citing its deputy head Zhang Zhiyong. Authorities will also tighten management of tax practices by Chinese companies abroad, Zhang said.
China is expanding efforts to rein in what authorities say is tax evasion by foreign companies, according to Bloomberg. Microsoft Corp. was required to pay more than $150 million, a person familiar with the matter said last month.
The payments – including 840 million yuan ($137 million) in back taxes, interest, and more than 100 million yuan in additional annual disbursements – were detailed in a Nov. 23 report by the state-run Xinhua News Agency, which stopped short of naming the company involved. Microsoft has said it couldn’t confirm that it was the subject of the Xinhua report, according to Bloomberg.
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- How to reduce the tax bite on company stock in a 401(k) (Wall Street Journal)
- Retailers target Alibaba in online sales tax push (The Hill)
- Avoid sales tax online Cyber Monday (or any other day) (Forbes)
- The oil price crashes; so let’s raise the gas tax and free crude exports (Forbes)
- A Cadillac (tax) for everyone (Forbes)
- The tax realities of adoption (Forbes)
- No mystery that investment slump hurts workers, lowers productivity and wages (Tax Foundation)
- Confusing income with taxable income (Tax Foundation)
- Less than one percent of businesses employ half of the private sector workforce (Tax Foundation)
- Why not just get rid of them all? (Tax Foundation)
- Tax extenders: Take them or leave them (Tax Foundation)
- Congress should reject half-trillion-dollar corporate tax giveaway (Tax Justice Blog)
- Nonresident income taxes likely to remain a focus for state tax authorities (Tax Analysts)
- The best hopeless idea in Washington (Tax Analysts)
- Factor sales and use taxes into your holiday shopping budget (Don’t Mess With Taxes)