Small businesses to increase accounting spend

Posted 3/16/2018

Sen. Ron Wyden (D-OR), the ranking Democrat on the Senate Finance Committee, has penned a study predicting that small businesses will spend more on accounting services this year as they negotiate the finer details of the new tax law. Of particular concern, he writes, is the pass-through deduction, the text of which spans nine pages, cross-references more than 20 other sections of the tax code, and directs the Treasury Department to issue volumes of new regulations. He added: “What good is a deduction if money spent in annual fees to your accountant far exceed the tax break? Main Street job creators will be lucky if they figure out how to calculate their deduction any time soon.” AICPA has requested further guidance from the IRS highlighting the pass-through deduction as a key issue for taxpayers.

Accounting Today

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Chamber of Commerce requests tax law guidance

Posted 3/15/2018

The U.S. Chamber of Commerce has followed AICPA in asking the IRS for more guidance regarding the Tax Cuts and Jobs Act, specifically on the definitions of qualified business income, and limitations on business interest. The lobby group wants to know whether all similar qualified businesses are aggregated for purposes of the calculation or if each business is evaluated separately, and whether a trade or business is defined as an activity within an entity, in cases where an entity has two clearly separate trades or businesses. Other issues it has asked for clarification on include foreign tax credits, the new Base Erosion and Anti-Abuse Tax, and Global Intangible Low-Taxed Income.

Accounting Today

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IMF champions tech to aid crypto-crackdown

Posted 3/14/2018

Christine Lagarde has called for regulators to "fight fire with fire" as part of the wider crackdown on crypto-currencies. The International Monetary Fund boss said technologies such as biometrics, artificial intelligence and cryptography "can enhance digital security and identify suspicious transactions in close to real time.” In other news, Google is cracking down on cryptocurrency-related advertising, with a ban on marketing for initial coin offerings (ICOs), wallets, and trading advice from June. Scott Spencer, Google’s director of sustainable ads, said of cryptocurrencies: “we've seen enough consumer harm or potential for consumer harm that it's an area that we want to approach with extreme caution.”


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Internal audit profession turning to tech

Posted 3/13/2018

Internal auditors are making increased use of technology initiatives such as cybersecurity and data analytics, according to several new reports. Research by PwC found that 75% of companies who use internal audit technology will see a return on investment, but only 14% of internal audit functions are advanced in their adoption of technology. A separate report, from the Institute of Internal Auditors’ Internal Audit Foundation and Crowe Horwath , found internal auditors are increasingly adapting to cybersecurity risks and have growing responsibilities in validating the effectiveness of cyber risk management.

Accounting Today

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Accounting watchdogs find ‘serious problems’ at 40% of audits

Posted 3/12/2018

Fresh concerns have been raised about audit quality after the International Forum of Independent Audit Regulators found serious errors in 40% of the 918 audits it inspected last year. The IFIAR had challenged global audit networks to bring down their error rate by at least 25% over a four-year period; at the half-way point of the period, 30% of publicly-traded entities had at least one audit deficiency finding, almost at the targeted 29%. The most common issue identified by these regulators was a failure among auditors to “assess the reasonableness of assumptions”. The second biggest problem was a failure among auditors to “sufficiently test the accuracy and completeness of data or reports produced by management”.

Financial Times Compliance Week

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NSA: more time needed for S corp elections

Posted 3/9/2018

The National Society of Accountants has asked the IRS for a six month extension of the time by which a corporation must make an election to be treated as an S corporation for the current calendar year, so as to allow time for the agency to issue appropriate guidance, as well as for tax preparers to analyze the guidance and provide sound advice to clients. The requested extension would push the deadline back to September 15th.

Tax News CPA Practice Advisor

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IRS updates tax tables and inflation adjustments

Posted 3/8/2018

The IRS has issued newly updated tax tables and inflation adjustments for the new tax law. Rev. Proc. 2018-18 changes the beginning and ending dollar amounts for the brackets, and replaces the existing tax rates with seven new rates of 10%, 12%, 22%, 24%, 32%, 35% and 37%. The revenue procedure also adjusts some of the other previously announced income limits. For the Earned Income Tax Credit, it’s $10,180 for taxpayers with one child, and $14,290 for two or more children, and $6,780 for none. Separately, the IRS has reduced the family contribution limit for health savings accounts by $50, from $6,900 to $6,850. However, the individual contribution limit remains at $3,450.

Accounting Today Forbes Pensions & Investments

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H&R Block losses widen

Posted 3/7/2018

H&R Block saw its shares rise over 9% yesterday, after it reported a wider-than-expected fiscal third-quarter 2018 loss but quarterly revenues that came in above expectations. In the three months to January 31st, the tax preparation firm lost $245.6m significantly up on the $104.5m it lost 12 months earlier. Revenue increased 8%, however, to $488m, from $452m, driven by increased return volumes in its assisted and do-it-yourself tax preparation businesses. H&R Block also said it prepared 10.697m returns through February 28th, up from 10.345m a year ago. Chief executive Jeff Jones said the results from the first half of this year's tax season show H&R Block is building on its momentum.

Kansas City Star Market Watch

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Gig economy won't save American workers

Posted 3/6/2018

Forbes contributor Erik Sherman says that operators in the gig economy must be transparent about costs and pass on enough revenue to contractors so they can gain a reasonable income. "Workers are the ones being expected to save the American economy by accepting below-poverty wages. That is a recipe for ultimate disaster," he concludes.


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Excel skills no longer essential

Posted 3/2/2018

Research by Adaptive Insights reveals that CFOs no longer consider Excel as an essential skill. Finance leaders are now more concerned about employees’ ability to use technologies to access, analyse, and amplify data for insights to better manage the business. Two years ago, 78% of CFOs said proficiency in Excel is the most important skill for their financial planning and analysis teams, but today, just 5% agree.


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