NEWS HIGHLIGHTS FOR FRIDAY - 7.22.16

By:
Maya Lindsay
Published Date:
Jul 22, 2016

Accounting and Finance News

 

Hidden Dangers

Accounting Today

Most accountants perform at least some tax work, so it’s not surprising that the majority of professional liability claims against accountants are in the tax arena. “The higher-dollar claims against accountants are in the financial statement area, but the opportunity for tax claims is greater,” said Ron Parisi, of Orchard Accounting and a former insurance company executive. “But there are a lot of ‘black and white’ errors.

 

J.P. Morgan Chase Nearing Settlement With Prosecutors on Asia Hiring Probes

Wall Street Journal

J.P. Morgan Chase & Co. is expected to pay around $200 million to settle federal investigations into whether it tried to win business by hiring the sons and daughters of powerful people in Asia, people familiar with the matter said. The settlement is expected in the coming months and would resolve criminal and civil matters under a foreign bribery probe that has dogged the bank for years.

 

The CPA’s Role in QDROs

Accounting Today

For some accountants, the only QDRO they will see will be part of their own divorce decree. But for many others, advising on QDROs is a part of their practice. A QDRO—short for “qualified domestic relations order” and pronounced “quad row”—is a judgment, decree or order for a retirement plan to pay child support, alimony or marital property rights to a spouse, former spouse, child or other dependent of a participant.

 

Fee For Tax-Exempt Application Drops

The NonProfit Times

Nonprofits that plan to operate as a 501(c)(4) social welfare organization must file a new form with the Internal Revenue Service (IRS) while fees for a new streamlined application for tax-exemption have been cut by a third. The user fee for Form 1023-EZ, the application for recognition of exemption under 501(c)(3) of the Internal Revenue Code, dropped from $400 to $275, as of July 1.

 

Amazon Tiptoes Into Banking Business Through Student Loans

Wall Street Journal

Amazon.com Inc. is stepping into the student-loan marketplace. The online retailer has entered into a partnership with San Francisco lender Wells Fargo & Co. in which the bank’s student-lending arm will offer interest-rate discounts to select Amazon shoppers. An Amazon spokeswoman said this is the first time members of the company’s “Prime Student” service are receiving a student-loan offer by a lender through its site since that service was launched in 2010.

 

4 employer challenges brought on by ACA compliance

Employee Benefit Adviser

Complying with the Affordable Care Act has put employers “through hell,” and a look at the future “is scary,” Brad Mandacina, AVP and director, HR technology at Lockton, said Thursday at a conference in Park City, Utah. Compliance has created four key areas of frustration for employers, he explained at the conference sponsored by PlanSource.

 

The DOL Isn't Done Yet and Non-Compliance is Getting More Expensive Than Ever

JD Supra Business Advisor

Employers around the country are busy trying to keep up with the fast and furious rule-making from the Department of Labor. From OSHA reporting requirements, the persuader and fiduciary rules and the new overtime regulations, this unprecedented activity from the DOL has kept employers scrambling to understand the current law and stay in compliance.

 

SEC Chief Accountant Injured in Bike Accident

Accounting Today

James Schnurr, the chief accountant in the Securities and Exchange Commission’s Office of the Chief Accountant, has been seriously injured in a bicycling accident, and the SEC named deputy chief accountant Wesley R. Bricker as interim chief accountant while Schnurr recuperates. As interim chief accountant, Bricker will be the SEC’s main advisor on accounting and auditing matters, the Commission announced Thursday.

 

How Are Multinational Corporations’ Foreign Profits Treated Around the World?

Tax Foundation

Over the past 30 years, many countries have moved away from "worldwide" tax systems that tax their domestic corporations’ worldwide profits. Instead, many countries have what is called a “territorial” tax system. A territorial tax system generally allows corporations to deduct or exclude the majority of dividends received from their foreign operations. Currently, 91 countries have a territorial tax system of some kind.

 

Dow Snaps 9-Session Winning Streak

Wall Street Journal

U.S. stocks fell, snapping a rally that propelled major indexes to new highs. The Dow Jones Industrial Average had climbed nine sessions in a row for its seventh record close Wednesday. But U.S. indexes retreated from those highs Thursday, dragged down by shares of industrial and energy companies. Some analysts and traders said they weren’t surprised to see a pullback in shares after U.S. indexes had notched records, day after day, for the past week.

 

Why millennials are attracted to the RIA model

Financial Planning

For millennials, financial literacy is under taught and its value under appreciated, says Julia Buchholz, a senior at the University of Illinois Urbana-Champaign. Buchholz wants to change that by becoming a financial planner - a welcome move for an industry that is facing adviser shortages and a dearth of young talent. “The RIA industry has seen steady growth over the past 30 years serving boomers, but now we need to attract young clients and new talent,” says Tom Nally, president of TD Ameritrade Institutional.

 

IRS Proposes New QI Agreement for Foreign Banks to Comply with FATCA

Accounting Today

The Internal Revenue Service has released new guidance on how foreign financial institutions can enter into a Qualified Intermediary agreement with the U.S. under the Foreign Account Tax Compliance Act, or FATCA. Notice 2016-42, released earlier this month, outlines the proposed QI agreement, which revises and updates the current agreement in Rev. Proc. 2014-39, released by the IRS in July 2014.

 

Ohio CPA Society Leads New Research to Improve CPA CPE ROI

CPA Practice Advisor

The Ohio Society of CPAs (OSCPA) is teaming with CPA Trendlines Research and Michael Ramos + Associates to conduct an extensive study of CPAs’ learning plans, attitudes and behaviors. The partnership is part of an effort to uncover the top trends and best practices in professional development in the tax and accounting industry.

 

The Fed Missed Its Chance. Now What?

Wall Street Journal

The Federal Reserve is in a tough spot. When the central bank’s policy makers meet next week, many observers expect them to leave interest rates untouched, perhaps citing the shock of Britain’s vote to leave the European Union. The difficulty is that many indicators, particularly from the labor market, suggest that the U.S. economy is peaking and that the recovery from the Great Recession is nearly complete.

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