November 6: The corporate tax rate would be permanently reduced to 20 percent under a House tax reform bill, and full and immediate expensing of “qualified property” would be permitted for five years. The proposed reduction of the corporate tax rate in the Tax Cuts and Jobs Act (H.R. 1) followed weeks of wrangling over what the corporate tax rate should be and how a reduction would add to the deficit. Click here to see the full story (Subscription required).

November 9: Multinational companies including Apple Inc., Pfizer Inc. and others would face a new tax on payments they make to offshore affiliates under the House Republicans’ tax bill—a surprise provision that has stunned tax experts. The new 20 percent tax is “the atomic bomb in the draft” legislation, said Ray Beeman, co-leader of Ernst & Young's Washington Council advisory services group. “We're trying to get our arms around the implications.” Click here to see the full story (Subscription required).  


November 6: General Electric Co. rejected any suggestion of accounting fraud at the company after a longtime Wall Street analyst said management risked facing investigations over the deepening stock slump. Any allegation of malfeasance in its books is “false and misleading,” GE said in an emailed statement. “There is no accounting fraud at GE.” Click here to see the full story (Subscription required).


November 6: The Republican tax plan proposes to eliminate a decades-old rule that's been blamed for fueling the meteoric rise of executive compensation at U.S. companies, and could upend popular retirement-savings programs used by scores of high-placed corporate leaders. Under current law, businesses can write off as much as $1 million in compensation expenses for chief executive officers and four other top-paid bosses, plus any amount beyond that if it's tied to performance targets. The Republican proposal would keep the $1 million threshold but eliminate the exemption for pay linked to results, denying companies the option to write off large equity awards. Click here to see the full story (Subscription required).

November 7: Stock options, a staple of executive compensation, could cease to exist under the Republican tax plan, which proposes to classify them as deferred pay, or money that's already earned but received at a later date.  Stock options would be taxed immediately when they vest which could lead to companies scrapping them altogether. Click here to see the full story (Subscription required).  


November 6: Acting Chief Charles E. Cain has been named head of the SEC Enforcement Division's Foreign Corrupt Practices Act Unit. Cain has served in an acting capacity since April when then-chief Kara Brockmeyer left the SEC for the private sector. Click here to see the full story (Subscription required).


November 6: The former chief financial officer of Osiris Therapeutics Inc. pleaded guilty to lying to the biotech company's auditors about revenue and in regulatory filings. At a hearing, Philip Jacoby admitted making false statements about third-quarter revenue in 2015. Click here to see the full story (Subscription required).


November 7: Passthrough owners could get preferential tax treatment on at least 30 percent of their earnings under a new Republican tax bill. The legislation lays out two options for determining how active partners or shareholders can distinguish their wages from their business profits. Click here to see the full story (Subscription required).

November 8: The government is working hard to come up with answers to the controversial issue of multi-tiered partnerships before a new audit regime takes effect, Treasury Department said. The new regime allows the IRS to collect unpaid tax at the entity level—rather than among individual partners—absent an election that would push out liability to the partners. Click here to see the full story (Subscription required).

November 9: States and impacted businesses are running short on time to deal with complex changes as the new federal partnership audit regime is about to take effect. Partnerships need to decide how they want to comply and pick a partnership representative before one is selected for them by the IRS. The partnership representative will have an enormous amount of power—but also must be indemnified and protected from liability, Steve Wlodychak, a principal with Ernst & Young said.  Click here to see the full story (Subscription required).


November 7: Corporate boards could play a bigger role in getting rid of shareholder proposals under new guidance from the SEC. Dealing with proposals submitted by investors has usually been the responsibility of company management, not directors, so getting boards more involved could represent a change for some companies. Click here to see the full story (Subscription required).


November 7: Canada is becoming a hub for socially-responsible investing as the nation's public funds commit to environmental, social, and governance strategies. Canada took the spot for the highest number of funds represented in a first-time ranking this week of the world's top 25 responsible asset allocators. Click here to see the full story (Subscription required).


November 8: Public companies face a dearth of clarity on critical issues less than two months before they must adopt U.S. and international accounting standards for recognizing and reporting revenue. The potential uncertainty could lead to financial statement inconsistencies and potentially open the door for intentional manipulation of corporate financials. Click here to see the full story (Subscription required).


November 8: Companies may use safeguards in delivering certain information about executive pay packages electronically, the SEC staff said. However, the safeguards can't be so burdensome that recipients effectively are unable to access the required disclosures. Click here to see the full story (Subscription required).

November 9: Company disclosures should become increasingly specific about probable effects from the transition to new accounting standards and avoid reverting to “cut and paste” information from previous reports, a SEC official told an American Institute of CPAs oil and gas conference. Click here to see the full story (Subscription required).


November 8: Prudential Financial Inc. reported “record-high” retirement account values of $415.8 billion in the third quarter, up 8 percent from the same time last year, the financial services firm said in its most recent earnings report. Click here to see the full story (Subscription required).


November 9: Several tax accounting projects on the IRS's priority guidance plan may become irrelevant or transform as a result of Congress’ final tax reform legislation. Projects related to the domestic production activities deduction under tax code Section 199 for computer software and qualified films are likely to become less important. Click here to see the full story (Subscription required).


November 9: The FASB decided against using the Supreme Court's definition for “materiality” because of unintended implications it posed for some investors. The FASB voted to revert to keeping materiality references in line with usage under Concepts Statement 2, Qualitative Characteristics of Accounting Information. Click here to see the full story (Subscription required).


November 9: State corporate tax practitioners should remain in constant contact with their federal tax counterparts to stay on top of potential return adjustments, according to John Murphy, a partner with Kolesar & Associates. He added that although there is a lack of uniformity among states in reporting federal tax adjustments, certain opportunities exist to maximize the use of firm resources and refund opportunities. Click here to see the full story (Subscription required).


November 9: The former chief financial officer of American Realty Capital Partners Inc. was sentenced to 18 months in prison for misleading investors by falsely inflating a key measure of the company's performance. Brian Block of Hatfield, Pa., was also ordered to pay a $100,000 fine. A jury convicted Block of six counts including securities fraud and conspiracy. Click here to see the full story (Subscription required).


November 9: The rigor of academic research and its larger sample sizes can provide guidance in setting accounting standards that the rulemakers can't provide themselves. Accounting professors complement FASB's in-house research and round out “feedback and input from a broad range of sources,” Christine Botosan, a FASB board member, said in a video interview. Click here to see the full story (Subscription required).



November 6: India's finalized country-by-country and master file reporting rules will add a “substantial compliance burden” for multinational groups operating in India, but practitioners say they still need further clarification. Click here to see the full story (Subscription required).


November 9: Directors should challenge management's accounting decisions in preparing financial reports if they consider accounting treatments to be inappropriate, under guidance from two professional accounting groups. The two groups issued guidance giving company directors in the U.K. and five Asian jurisdictions direction on how to meet their financial reporting obligations. Click here to see the full story (Subscription required).

Composed and Compiled by Gery Brownholtz, Accounting Editor, Bloomberg BNA

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