NEWS HIGHLIGHTS FOR FRIDAY - 5.13.16

By:
Maya Lindsay
Published Date:
May 13, 2016

Accounting and Financial News Stories

Jobs, Inflation, Wages: Good for the Economy, Bad for Stocks
Wall Street Journal
The Federal Reserve appears to finally be getting what it wants. The market might not be so happy about that. Steady job gains? Check. Rising wages? Positive signs are indeed emerging. A pickup in inflation? Pressure is mounting.

Filing Deadline Approaches for Tax-Exempts
Accounting Today
Many tax-exempt organizations have a filing deadline for Form 990-series information returns on May 16 -- and the IRS cautioned these groups not to include Social Security numbers or other unneeded personal information in their filings. Organizations that fail to file annual reports for three consecutive years will see their federal tax exemptions automatically revoked as of the due date of the third required filing.

Be Careful in Granting Profits Interests to Your Key Employees; New IRS Regulations Suggest the IRS is Keen on Form K-1 Filing
Lexology
On May 5, 2016, the Department of Treasury and the Internal Revenue Service published final and temporary regulations amending Treasury Regulations §301.7701-2 under Section 7701 of the Internal Revenue Code of 1986, as amended (the New Regulations) clarifying the tax treatment of partners in a partnership that owns a disregarded entity. The New Regulations highlight the surprising complexities and, in some instances, the troubling impracticalities of incentivizing key employees with equity grants in a “pass-through” entity.

Student Loan Debt Causing Delays in Retirement Saving
Plansponsor
Student loan debt is causing Americans to delay saving for the future and forcing them to take on multiple jobs, according to a survey from the American Institute of CPAs conducted by Harris Poll. Eight in 10 U.S. adults with student loans say they have made financial or personal sacrifices because of loan debt, and half of respondents say they delayed contributions to retirement accounts, up from 41% in 2013.

How You Can Help Clients Tell Your Story
AccountingWEB
It sounds so good in theory. Satisfied clients refer you business. You suggest meeting over dinner. You will even pick up the tab, so long as he doesn’t order that four-pound lobster the server introduces by name at your table. All your client has to do is invite another friend along, someone just like him.

Lower Dollar Means Higher Stocks, Right? Wrong
Wall Street Journal
The dollar is the cornerstone of the world financial system, and it is obvious that its value matters to investors. Quite how it matters is more difficult to understand, not least because the explanation keeps changing.

IASB Chair Hoogervorst Sees Pitfalls in Non-GAAP Metrics
Accounting Today
The head of the International Accounting Standards Board is echoing concerns abroad also voiced by leaders of the U.S. Securities and Exchange Commission about the increasing use of non-GAAP measures in the financial statements of public companies.  Speaking Wednesday at the annual conference of the European Accounting Association in Maastricht, the Netherlands, IASB chairman Hans Hoogervorst pointed to the widening difference between GAAP and non-GAAP numbers in financial reports.

FASB proposes simplifying goodwill impairment testing
Journal of Accountancy
Goodwill impairment testing would be simplified under a proposal FASB issued Thursday. FASB proposed removing Step 2 from the current goodwill impairment test. Under current GAAP, Step 2 includes determining the implied fair value of goodwill and comparing it with the carrying amount of that goodwill.

America's middle class is shrinking almost everywhere
CNN Money
The share of middle-income households declined in 90% of the country's 229 metro areas between 2000 and 2014, according to a new report by the Pew Research Center, released Wednesday. The middle class contraction is also happening on a national scale.

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