Accounting & Auditing Highlights for the Week Ending June 22, 2018


U.S. Highlights:

Credit Losses

June 19: New credit loss rules can cause auto loan financiers to breach their capital-requirement covenants with their lenders, leading to defaults and higher interest rates. Click here to read the full story. (Subscription required.)

Stock-based Compensation

June 21: New rules provide a less costly and simpler way to report compensation given to individuals not employed by the company making the payment. Click here to read the full story. (Subscription required.)

Nonprofits

June 20: Colleges, hospitals, and charities—such as the United Way and Habitat for Humanity—are getting a new accounting standard intended to boost the accuracy of reports on the grants that they receive. Click here to read the full story. (Subscription required.)

June 22: Nonprofit organizations in the U.S. are slowly beginning to accept cryptocurrency donations like bitcoin, but they come with accounting challenges. Click here to read the full story. (Subscription required.)

June 22: Accountants for some colleges, hospitals, and nonprofits such as the United Way will have a new standard to turn to when characterizing the giving and receiving of contributions of cash and other assets. Click here to read the full story. (Subscription required.)

Accounting

June 19: The Institute of Management Accountants has updated its workforce competency framework to include new expertise in areas like data governance and strategic management to help the industry pivot to the age of automation. Click here to read the full story. (Subscription required.)

June 22: The U.S. Supreme Court created work for accountants with its decision to allow states to tax online sales made by companies that lack an in-state presence. An onslaught of new sales taxes—some applied retroactively—by dozens of states and hundreds of counties will necessitate accounting and compliance challenges that could be particularly difficult for smaller sellers. Click here to read the full story. (Subscription required.

Audit Committee

June 20: Investors support Facebook Inc.’s decision to upgrade the responsibilities of its audit and risk management committee but aren't completely convinced it will better steer the social media company, protect users’ data, and instill more trust with users and shareholders. Click here to read the full story. (Subscription required.

Transfer Pricing

June 21: Valuing intangible properties is one of the most interesting, yet challenging exercises in transfer pricing for multinational companies, worldwide. Joyce Beebe and Bill Spiller review the similarities and differences intangibles valuation for transfer pricing and financial statement purposes. They also address the technical differences when taxpayers are applying certain methodologies at the implementation level. Click here to read the full Insight article. (Subscription required.)

Cyrptocurrencies

June 21: Evan Koster explores what are cryptocurrencies how they should be classified for regulation – securities, money, commodities or swaps? Click here to read the full Insight article. (Subscription required.)

Accounting Fraud

June 21: Two former executives of Roadrunner Transportation Systems have been charged with misleading shareholders and regulators in a $245 million accounting and securities fraud scheme, the Justice Department announced June 15. Click here to read the full story. (Subscription required.)

International Highlights:

U.K.

June 18: Accountants in the U.K. are surprisingly sanguine about the impact of Brexit on the profession, with some believing it could actually increase pay levels and their amount of work, according to a newly-released survey. Click here to read the full story. (Subscription required.)

June 21: The U.K. operation of Ernst & Young LLP has made increasing ethnic diversity a central part of its human resources strategy, with some success. Click here to read the full story. (Subscription required.)

Audit Scandal

June 19: The U.K. accounting watchdog sharply criticized the decline in audit standards at the biggest accounting firms, and said that KPMG LLP's audits have shown an “unacceptable deterioration” over the past year. Click here to read the full story. (Subscription required.)

June 19: A string of auditing scandals has intensified pressure to improve standards and introduce more competition to the Big Four firms’ hold in the U.K., with accountants taking very seriously politicians’ threats to force the breakup of the biggest firms. Click here to read the full story. (Subscription required.)

June 20: Pressure for action against the big U.K. accounting firms has intensified following the release of a disdainful report by the industry regulator, which upbraided KPMG for its “unacceptable” audit quality and found that audit standards had fallen at all of the biggest firms. Click here to read the full story. (Subscription required.)

June 22: The former finance director of a now defunct audit firm has been barred from the accounting profession for five years in another sign that the main U.K. financial regulator has sharpened its teeth in response to criticism of weak enforcement in a string of auditing scandals. Click here to read the full story. (Subscription required.)

Canada

June 19:  Canada's accounting standards setter is cautioning investors about misleading corporate performance information that can skew stock prices. Click here to read the full report. (Subscription required.)

Cryptocurrency

June 19: The Bank for International Settlements just told the cryptocurrency world it's not ready for prime time -- and as far as mainstream financial services go, may never be. Click here to read the full story. (Subscription required.)

Transfer Pricing

June 22: Başak Diclehan discusses how robotics process automation will help manage the workflow of transfer pricing and reporting. Click here to read the full Insight article. (Subscription required.

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

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