About 2.1 million taxpayers might have received a total of $3.2 billion in American Opportunity Tax Credits in error from the Internal Revenue Service in the first five months of 2010, according to the Treasury inspector general for tax administration. In most cases, the IRS did not have documentation that the taxpayers had attended accredited institutions. The Hill
The Internal Revenue Service on Thursday issued its annual revenue procedure adjusting various tax items for inflation, including the income tax tables and the amounts for various tax credits. It also announced the 2012 contribution limits for pensions and other inflation-adjusted retirement-related items. JournalofAccountancy.com
The Financial Accounting Standards Board will consider delaying implementation of certain aspects of the updated Presentation of Comprehensive Income standard. FASB issued the update in June, requiring separate presentation of items reclassified to net income, among other changes. Stakeholders have said they need more time to implement the update properly. Read more»
The Governmental Accounting Standards Board issued a proposal that it said would resolve “conflicting guidance” contained in Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions, and Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements. The exposure draft contains amendments regarding the reporting of risk-financing activities, certain operating lease transactions, and the acquisition of a loan or a group of loans. Read more»
Three academic studies have found that a high or increased audit fee for a client company suggests that the accounting firm anticipates legal problems for the company or that the firm has been putting in additional hours on the audit because of uncertainties. Read more»
Increases in gasoline prices have led workers to overstate their mileage on expense reports, according to a study by Natural Insight. Even when gas was cheapest, workers overstated expenses by 18%, the study found. “While businesses are supportive of proper worker expense compensation, over-reporting on expense reports is more common than we expected to see and certainly presents a large opportunity for cost reduction if properly identified,” Natural Insight CEO Stefan Midford said. Read more»
The Financial Accounting Standards Board’s Not-for-Profit Advisory Committee recommended requiring more information from nonprofits in their financial reporting. One recommendation would require an analysis that would give more context for data, comparable with a publicly traded company’s “Management Discussion and Analysis.” Read more»
The Financial Accounting Standards Board could revive a 2008 proposal that would shift to companies the responsibility of flagging concerns that they might fail Now, it’s up to auditors to issue going-concern warnings in annual reports. Some say companies are in a better position to make the calls and that auditors feel pressure not to call attention to problems that could spook investors and jeopardize their own relationships with clients. Read more»
Factoring — a form of funding in which finance companies buy accounts receivables from businesses that need money — has gained in popularity as bank loans have dried up. But factoring can also be more costly than other types of financing. “The key to a factoring or discounting decision is a complete analysis of all the financial implications of the decision. It’s more complicated to analyze than a bank loan,” said Bill Hettinger of the Institute for Finance and Entrepreneurship. Read more»
Bank of America is expected to be one of the first major U.S. banks to impose fees on debit card transactions, and many other free services might also disappear. JPMorgan Chase and Wells Fargo plan to test debit card fees in some states or have already begun doing so. Read more»
