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The Accountant’s News Brief www.PLIGofSJ.com

May 2014

Marketing Tip #47: Go back through your past blog posts and make sure you only have one call to action. Google penalizes posts that are too “marketing” oriented.

Bank of America Commits $4 Billion Accounting Mistake

Bank of America, the second largest U.S. financial institution, went on record to disclose an accounting error, unnoticed for several years, which led the banking giant to report that it had $4 billion more capital than it actually had. The mistake went undetected by Bank of America’s internal accountants, as well as external auditors PricewaterhouseCoopers. A Federal government committee conducted a stress-test back in March, which they passed, allowing B. of A. to receive approval for a $4 billion share repurchase program. For more information, head to: nyti.ms/1iyoi9I New Study Shows That Tax Penalties and Income Levels Don’t Necessarily Correlate A new study by WalletHub, a personal finance social network, shows that the lower the income an individual or corporation makes, the higher the tax penalties levied. WalletHub found that individuals who earn less than $200,000 per year “pay 83 percent higher penalties as a percentage of their adjusted gross income” than people making more than the $200,000 mark. On the other hand, individuals who earn more than $10 million “are 3,933 percent more likely to be audited than those who make between $25,000 and $100,000.” For more details of the study, visit: bit.ly/1fpACPk.

Accounting Class Action Lawsuits Hold Steady

Cornerstone Research has released their 2013 study of lawsuits involving accounting firms. The report details 47 class action lawsuits against accounting firms, which is up from the 46 filed in 2012. The report shows some progress, though, as the yearly average over the past decade is 72 cases. Of the 47 cases filed in 2013, 38 resulted in settlements. This is, again, lower than the 10-year average, which has been 58. To read the full report, go to: bit.ly/R4cg2p

U.S. CEOs Want International Tax Reform

According to a recent survey, 81 percent of U.S. CEOs are clamoring for better international tax laws. PricewaterhouseCoopers conducted the study, which found that the CEOs are concerned about rising tax rates in the face of a global marketplace that is becoming increasingly competitive. With the U.S. having the highest statutory corporate tax rate in the world, U.S. CEOs are highly skeptical that domestic lawmakers will enact any kind of policy that will allow for more international competition. To read the full results of the study, go to: pwc.to/RgYtWc


The Accountant's News Brief: May-June '14