NEWS HIGHLIGHTS FOR FRIDAY - 8.19.16

By:
Maya Lindsay
Published Date:
Aug 19, 2016

Accounting and Financial News Stories

Cos. Don’t Meld Accounting for Internal Transactions: Poll
CFO
Under 10% of nearly 4,000 mostly accounting and finance professionals say their organizations coordinate how their internal transactions are accounted for, according to to a recent Deloitte poll, indicating a lack of holistic, efficient, and well-communicated intercompany accounting frameworks at many multinationals.

Why Accounting is the Language of Business
AccountingWEB
Are you listening? We are each familiar with the phrase, “Accounting is the Language of Business” but what does that really mean? I know of two families who have grown children each of whom is deaf.  In both families, the parents choose to not teach their deaf child or learn for themselves sign language.  Only now that their deaf children are young adults and learning to sign on their own are they are also beginning to learn sign language.

U.S. Government Bonds Strengthen
Wall Street Journal
U.S. government bonds strengthened on Thursday, as investors continued to react to the latest signal that Federal Reserve policy makers are hesitant to raise rates in September. The yield on the benchmark 10-year Treasury note was 1.536% in late afternoon trading. It fell to 1.558% on Wednesday from 1.576% the previous day after the release of minutes from the Fed’s July policy meeting. Yields fall when bond prices rise.

AICPA Proposes Changes in Peer Review Reports and Firm Representation Letters
Accounting Today
The American Institute of CPAs is proposing to change the current peer review report so it clearly indicates if a Single Audit was chosen. The AICPA’s Peer Review Board issued an exposure draft Wednesday containing the proposal along with another proposal that the representation letter should be modified to reflect all must-select engagements, including Single Audits.

Watch Out, Retirement Savers, Your Choices Are Poised to Shrink
Wall Street Journal
As brokers lay plans to satisfy new federal rules governing their relationships with retirement savers, one thing is becoming clear: Some clients will see their investment options diminished or face the prospect of higher fees. Brokerage Edward Jones, anticipating the fiduciary rule that will require brokers to put the interests of retirement savers ahead of their own, said on Wednesday that it would stop offering mutual funds and exchange-traded funds in retirement accounts that charge investors a commission.

FASB modifies not-for-profit accounting rules
Journal of Accountancy
FASB issued a new accounting standard Thursday that is designed to help not-for-profits tell their story through their financial statements. Not-for-profit financial statements have been prepared under FASB's current guidance since 1993. The new standard changes presentation and disclosure requirements with the intention of helping not-for-profits provide more relevant information about their resources—and the changes in those resources—to donors, grantors, creditors, and other financial statement users.

Pre-immigration and Non-U.S. Resident Planning
Lexology
Foreign individuals who intend to permanently reside in the U.S., or do not intend to reside in the U.S. but intend to own U.S. property, need considerable legal and tax planning. The definition of “U.S. property” for international tax purposes is a term of art and complex. This planning should be done in advance to minimize U.S. tax exposure and to plan for the ownership of U.S. property.

IRS Warns About ‘Federal Student Tax’ Scams
Accounting Today
Telephone scammers may target students and parents during the back-to-school season and demand payments for such non-existent taxes as the “Federal Student Tax,” the IRS has warned. IRS impersonators may call students and demand that money be wired immediately to pay a fake federal student tax, according to the Service. As in other similar scams, if the taxpayer doesn’t comply, the scammer becomes aggressive and threatens to report the student to the police to be arrested.

Revised CPE Standards Allow New Modes of Learning
AccountingWEB
Significant changes to continuing professional education (CPE) standards for CPAs have been approved by the American Institute of CPAs (AICPA) and the National Association of State Boards of Accountancy (NASBA). The updated standards will take effect on Sept. 1. CPE sponsors have until Dec. 31, 2016, to comply with the standards for programs now under development. The standards must be in place at the next CPE program review or revision date for all other programs.

PCAOB Finds Problems at Nearly All Auditors of Broker-Dealers
Accounting Today
The Public Company Accounting Oversight Board identified deficiencies at 96 percent of the firms that audit broker-dealers, according to a new report Thursday. The PCAOB’s annual report on its interim inspection program for auditors of brokers and dealers details the results of inspections that the board conducted last year, the first inspection year in which all inspected engagements were governed by new rules from the Securities and Exchange Commission. A fact sheet is also available.

Yield Seekers Can Have It Both Ways With Banks
Wall Street Journal
Investors desperate for yield have bid up consumer staples and utilities, but they are still shunning one group of stocks with decent dividends—banks. That should change. The six biggest banks in the U.S. sport an average dividend yield of 2.3%. True, that isn’t much above the S&P 500 yield of 2.1%, but it is the same available from the popular Consumer Staples Select Sector SPDR Fund, which has been bid up to a nosebleed multiple of 22 times 2016 earnings. By comparison, major banks fetch an average of 12 times earnings.

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