Some of the country's biggest industrial companies, led by 3M, posted higher-than-expected earnings and raised their second-half outlooks, adding to indicators that point to a building manufacturing rebound. Analysts said manufacturers' forecasts of significantly higher sales this year are credible because they are customarily based on orders already on the companies' books for products with long lead times.
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Young adults in the U.S. are much more likely to check their Facebook pages and Twitter feeds than their bank account balances and transactions, according to a new survey. The percentage of Americans ages 18 to 34 who check their social media accounts once a day is more than triple the percentage who check their bank accounts daily, according to a national telephone survey conducted for the AICPA by Harris Interactive in recognition of National Financial Literacy Month.
After nearly five years of declines, the Federal Housing Finance Agency's monthly home price index posted a year-over-year increase in February. In a sign that the housing market is bottoming out, the index of prices for existing homes rose 0.4% in February. In January, however, prices were down 0.5% from a month earlier.
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The Securities and Exchange Commission's pending decision on whether to adopt International Financial Reporting Standards for U.S. public issuers and what effect that decision could have on whether other major economies adopt them as well was a key topic of discussion with prominent panelists Sir David Tweedie, Bob Herz, and Paul Cherry on Tuesday at the AICPA in New York. The panelists also talked about political pressures in accounting standard setting; integrated reporting; financial reporting overload; and other topics.
The Public Company Accounting Oversight Board is continuing to look at how the audit committee can think and act independently, after warnings from Congress to pull back from a mandatory audit-firm rotation requirement, said PCAOB's newest member,
Jeanette Franzel. Ideas under consideration, she said, include strengthening the role of the audit committee and the possibility of retendering audits periodically.
The Internal Revenue Service issued proposed regulations on Tuesday that would allow taxpayers to deduct as business expenses the cost of lodging even when not traveling away from home, under certain circumstances. Normally such expenses are considered personal and therefore not deductible.
Mary Schapiro, chairman of the Securities and Exchange Commission, is planning to use an appearance before a House subcommittee to urge lawmakers to increase the agency's budget. "As we continue to implement the Dodd-Frank Act and begin our JOBS Act rule making, we will need additional resources, including new subject matter experts, to make the transition to new rule regimes as smooth as possible and to streamline existing processes for market participants while still maintaining essential protections for investors," Schapiro notes in testimony prepared for a House Financial Services subcommittee.
The Department of Labor has been working on a fiduciary standard for those who give investment advice, with opponents calling for a cost-benefit analysis of proposed changes. "From a cost-benefit [standpoint], you can't justify" the new rules, said Sen. Saxby Chambliss, R-Ga. He argued that the DOL is targeting a non-existent issue. "The customer was not complaining," he said. "There are regulations that go too far and end up costing the client money. Those are the kinds of regulations we need to make sure are not imposed on the financial community." Keep up-to-date on the latest DOL proposed regulations on AICPA.org.
The International Monetary Fund said in a paper that authorities should consider giving regulators power to subject bank bondholders to losses to avoid a collapse of the financial institution. "Bail-in power needs to be considered as an additional and complementary tool for the resolution of systemically important financial institutions," according to the paper.
Denmark, which is holding the rotating EU presidency, suggested allowing companies that issue a lot debt to avoid a proposed rotation of credit rating agencies if they hire at least four rating firms simultaneously. The proposal would scale back a draft law to require companies to change the rating company that assesses their creditworthiness every three years.
Among CPA Letter Daily readers responding to last week's poll, most said that with the busy season behind them, they plan to focus on catching up on non-tax clients and services. The second most-cited priority was catching up on sleep or relaxing, followed by taking a vacation. Find out the top 10 stories and resources from the 2012 Tax Season Watch section in this blog post.
Now that busy season is over, what do you plan to do next?
Catch up on non-tax clients/services
Take a vacation
Remind clients of year-round services and pursue new clients
Attend a conference/catch up on CPE
File amended returns
Tangible property regs need more work to help taxpayers
The AICPA told the Internal Revenue Service that its efforts to clarify the rules for deduction and capitalization of tangible property expenses will help some taxpayers but overall, impose more burden than clarity. "The overall approach in the temporary regulations relies too heavily on a 'facts and circumstances' based approach," said AICPA Tax Executive Chair Patricia Thompson, CPA, in an April 17 letter, "and contains too few bright line tests to alleviate administrative burden and complexity in the capitalization area." Thompson also expressed concern that requiring an "applicable financial statement" in order to use the de minimis rule (for amounts paid to acquire or produce tangible property) could unfairly discriminate against smaller taxpayers and suggested an alternative test. The AICPA will continue to offer recommendations on these regulations and will testify at the IRS public hearing on May 9.
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American Institute of CPAs
is the world’s largest member association representing the accounting profession, with more than 412,000 members in 144 countries, and a history of serving the public interest since 1887. AICPA members represent many areas of practice, including business and industry, public practice, government, education and consulting. The AICPA sets ethical standards for the profession and U.S. auditing standards for private companies, nonprofit organizations and federal, state and local governments. It develops and grades the Uniform CPA Examination, and offers specialty credentials for CPAs who concentrate on personal financial planning; forensic accounting; business valuation; and information management and technology assurance. Through a joint venture with the Chartered Institute of Management Accountants, it has established the Chartered Global Management Accountant designation, which sets a new standard for global recognition of management accounting.