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The Daily

NEWS HIGHLIGHTS FOR WEDNESDAY - 3.30.16

By:
Maya Lindsay
Published Date:
Mar 30, 2016

Accounting and Financial News Stories

Bitcoin Technology’s Next Big Test: Trillion-Dollar Repo Market
Wall Street Journal
Depository Trust & Clearing Corp., a firm at the center of Wall Street’s trading infrastructure, is about to give the technology behind bitcoin a big test: seeing whether it can be used to bolster the $2.6 trillion repo market. DTCC said in a statement Tuesday that it will begin testing an application of blockchain, the digital ledger originally used to track ownership and payments of the cryptocurrency bitcoin, to help smooth over problems in the crucial but increasingly illiquid corner of short-term lending markets known as repurchase agreements, or “repos.”

Accounting News Roundup: Blockchain Replacing Auditors and Sustainability Accounting | 03.29.16
Going Concern
Sustainability accounting - I have no idea whether companies will embrace sustainability reporting or not, but a whole slew of firms are now "SASB Advisory Partners" who will "lend their expertise, tools and perspective to support the consideration and application of SASB standards." That sure gives the impression that companies will embrace sustainability reporting. Still, I don't get the sense that there's a huge demand right now.

IRS Faulted for Controls over Financial and Taxpayer Data
Accounting Today
The Internal Revenue Service has made progress in implementing information security controls, but a new report from the Government Accountability Office finds that weaknesses in the controls limited their effectiveness in protecting the confidentiality, integrity and availability of financial and sensitive taxpayer data. During fiscal year 2015, the IRS continued to devote attention to securing its information systems that process sensitive taxpayer and financial information, according to the GAO.

IRS Finalizes Rules on Recovering Litigation Costs
Accounting Web
Six years after proposing amendments to Section 7430 of the Internal Revenue Code, the IRS earlier this month issued final rules concerning the awards of administrative costs and legal fees incurred by a prevailing party in a tax-related administrative or court proceeding. To qualify for an award, a prevailing taxpayer must exhaust administrative remedies, pay or incur costs, and meet net-worth requirements.

Janet Yellen Says Fed Still Plans to Raise Interest Rates but Carefully
New York Times
Janet L. Yellen, the Federal Reserve chairwoman, said on Tuesday that the United States economy remained on track despite a rough start to the year because the drag from weak growth in other countries was being offset by lower borrowing costs. Ms. Yellen told the Economic Club of New York that the economy “had proven remarkably resilient,” and that the Fed expected better days ahead. She said the Fed still intended to pursue a careful, patient course toward higher interest rates as the economy improved.

Grooming Top Executives Includes Outside Board Experience
Wall Street Journal
As they groom their star executives, more U.S. businesses are working hard to find them outside board seats. Chiefs of companies such as International Flavors & Fragrances Inc., Cognizant Technology Solutions Corp., Sempra Energy and Exelon Corp. say they have been actively trying to obtain directorships for several top officers.

Internal Audit Outsourcing More Externally
Accounting Today
One out of three internal audit departments worldwide are now outsourcing at least some of their work to a third party, according to a new study. The study, from the University of Wisconsin-Madison's Wisconsin School of Business, found that North American companies are leading the trend, with 56 percent of responding companies admitting they rely on outside services. Dereck Barr-Pulliam, assistant professor of accounting and information systems at the Wisconsin School of Business, analyzed data from the Institute of Internal Auditors Research Foundation’s 2015 Common Body of Knowledge survey to come up with the numbers.

Hackers Breach Law Firms, Including Cravath Swaine and Weil Gotshal
Wall Street Journal
Hackers broke into the computer networks at some of the country’s most prestigious law firms, and federal investigators are exploring whether they stole confidential information for the purpose of insider trading, according to people familiar with the matter. The firms include Cravath Swaine & Moore LLP and Weil Gotshal & Manges LLP, which represent Wall Street banks and Fortune 500 companies in everything from lawsuits to multibillion-dollar merger negotiations.

Weak IRS controls leave taxpayer data vulnerable, report says
The Washington Post
Just in time for tax season, the Government Accountability Office is warning that weak financial controls at the Internal Revenue Service leave taxpayer information at risk. In a report released Monday to IRS Commissioner John Koskinen, the GAO noted the agency’s progress in information security but said “weaknesses in the controls limited their effectiveness in protecting the confidentiality, integrity, and availability of financial and sensitive taxpayer data.” The GAO chided the IRS, saying it “has not effectively implemented elements of its information security program.”

Taxpayer Advocate Holding Public Forums Seeking Taxpayer Comment On IRS Future Plans
Forbes
National Taxpayer Advocate Nina E. Olson and Rep. Mark Meadows, chairman of the House Oversight and Government Reform Subcommittee on Government Operations, have announced the next in a series of public forums designed to allow taxpayers to voice what they want and need from the IRS in order to comply with their tax obligations. The next public forum will be held on Monday, April 4, at 5:30 pm at the Henderson County King Street Meeting Room in Hendersonville, North Carolina. Members of the public and the media are invited to attend.

Affordable Care Act Enrollee Spending Is Increasing
Wall Street Journal
People who enrolled in insurance plans under the Affordable Care Act generated higher medical spending in the law’s second year than in the first, according to a new analysis of health-insurer data released by an industry group. The analysis, based on claims from 21 Blue Cross and Blue Shield insurers around the country, highlights a challenge the companies say they face covering the population that signed up for plans issued under the ACA, sold both on the law’s signature marketplaces and outside them.

Nonprofits Anticipate Revenue Growth This Year
Accounting Today
More than 80 percent of nonprofits anticipate growth and increased revenues in 2016, according to a new survey. The survey, by Capital One and conducted at the Greater Washington Society of CPAs' 27th Annual Nonprofit Symposium. Eighty-three percent of the survey respondents anticipate increased revenues in 2016, an increase from 77 percent from the prior year’s survey. Despite this positive outlook, nonprofits still face challenges and risks.