Accounting & Auditing Highlights for the Week Ending April 27, 2018


U.S. Accounting Highlights:

Auditing

April 26: KPMG LLP will add outside directors to its U.S. board in an effort to rebuild trust with its clients and stakeholders in the wake of significant turmoil at the company, including information theft charges and arrests involving former employees. Click here to read the full story. (Subscription required)

April 26: General Electric Co. shareholders have voted to keep the same auditor the company has had for more than a century, rejecting calls to end the relationship with KPMG amid concerns about accounting oversight. Click here to read the full story. (Subscription required.)

Sexual Harassment 

April 23: Three of the largest accounting firms in the U.S. have started talking about an uncomfortable and nearly ignored topic: sexual harassment among their legions of accountants, lawyers, and business consultants. Click here to read the full story about how the Big 4 accounting firms are responding to the #MeToo movement. (Subscription required.) 

Discrimination 

April 26: Ernst & Young U.S. LLP and Viacom Inc. each discriminated against new dads for requesting or using federally protected family leave, a pair of new lawsuits charge. Click here to read the full story. (Subscription required.) 

Accounting 

April 25: The rapid rise in cloud storage is raising red flags among some accountants, who are concerned that fees for the service will remain mostly unknown because they aren't recorded on balance sheets. Click here to read the full story about accounting in an era of the cloud. (Subscription required.) 

Collaborative Arrangements 

April 27: U.S. accounting rulemakers issued a proposal to address when companies would record revenue generated from collaborative arrangements—cost sharing partnerships common among biotechnology, pharmaceutical and life sciences companies. Click here to read the full story. (Subscription required.) 

Leasing 

April 27: What do McDonald's Corp., The Russian Tea Room, 21 Club, and Starbucks Corp. have in common? For the first time they will record on balance sheets real estate and equipment leases, worth millions of dollars for some franchises, when new leases rules take effect. Click here to read more about why restaurants might find lease accounting changes unappetizing. (Subscription required.) 

Revenue Recognition 

April 27: Dell Technologies Inc. saw a $380 million increase to 2018 net revenue after adoption of new accounting rules for customer contracts, the company's chief accounting officer said. Click here to read the full story. (Subscription required.) 

April 23: New revenue rules that require emerging franchisers to defer some of their earnings have created an uproar for an industry that spans a wide gamut of businesses. Click here to read the full story. (Subscription required.) 

Tax Reform 

April 27: Top tax executives at Ralph Lauren Corp. and BlackRock Inc. have found it challenging to explain the 2017 tax act's effects to their companies. Click here to read more about how corporations are grappling with the tax law’s tough global provisions. (Subscription required.) 

April 24: The IRS intends to issue guidance on how U.S. multinational corporate families that file a single tax return should calculate what they owe under a new “base erosion” tax, an agency official said. Click here to read the full story. (Subscription here.) 

Blockchain 

April 24: Three financial technology and accounting pros explain what accountants need to know about blockchain and what all the buzz is about. Click here to read blockchain 101 for accountants. (Subscription required.) 

Cryptocurrencies 

April 26: The lack of a central operator in peer-to-peer exchanges could make them exempt from traditional financial industry laws, and could also make it tougher for regulators to probe trading activity, according to financial attorneys and former regulators. The newfound regulatory spotlight also could drive more crypto traders to steer their business to decentralized exchanges. Click here to read the full story. (Subscription required.) 

April 25: Tokens sold in initial coin offerings have come under increased scrutiny from U.S. regulators, but some of the biggest cryptocurrencies aren't necessarily off the hook. Click here to read the full story.

SEC 

April 26: Hacked by Russia? That won’t insulate a company from any potential liability for failing to “provide material disclosures to its investors,” the SEC’s Enforcement Division Co-Director Steven Peikin told reporters after the agency announced the $35 million Yahoo settlement. Click here to read the full story. (Subscription required.) 

April 26: The company formerly known as Yahoo! Inc. will pay $35 million to settle Securities and Exchange Commission claims stemming from its delay in revealing a massive data breach, becoming the first U.S. firm fined for failing to properly tell investors it was the victim of a hack. Click here to read the full story. (Subscription required.) 

International Accounting Highlights:

Tax Reform 

April 24: Companies face a huge rollout of new tax legislation worldwide in 2018, increasing the risk of “unpleasant surprises” for them in the future, according to one of the largest accounting firms. Click here to read the full story. (Subscription required.) 

April 23: European Union members of parliament accused countries in the bloc of “protecting the interests” of multinational companies by blocking a proposal requiring them to report profits earned and taxes paid on a country-by-country basis. Click here to read the full story. (Subscription required.) 

Management Performance 

April 26: The International Accounting Standards Board voted unanimously to advance a proposed strategy to incorporate management performance measures in companies’ financial statements. Click here to read the full story. (Subscription required.) 

Steinhoff Accounting Scandal 

April 23: The chairwoman of Steinhoff International Holdings NV compared the South Africa-based retailer to a burning building when the accounting scandal broke four months ago, and appealed for shareholder support for an ongoing investigation into what happened. Click here to read the full story. (Subscription required.) 

Sustainability 

April 27: Philippe Zaouati, CEO of Mirova, discusses how European regulations could be shifted to help expand sustainable investment options. Click here to read the full Q&A. (Subscription required.) 

Russia 

April 24: Auditors must notify Russian authorities if they detect any indication whatsoever that a client is laundering money or is engaged in financing terrorism, under a new law that took effect April 23. Click here to read the full story. (Subscription required.) 

Composed and compiled by Amanda Iacone, accounting reporter for Bloomberg Tax.

Rely on expert practitioners for practical guidance and real-world approaches to complex accounting issues with Bloomberg BNA’s Financial Accounting Resource CenterTake a free trial today.