professionwatch
FRAUD IN THE SPRING
As spring wore on, talk of fraud was in the air
— as was legislation: A bipartisan group of
lawmakers introduced legislation that would
increase the penalties on tax preparers who
defraud taxpayers and the Internal Revenue
Service by altering tax returns for personal
bene;t without their clients’ knowledge.
At the same time, congressional hearings
on identity-theft-related tax fraud saw calls
for the Internal Revenue Service and the
Social Security Administration to do more
to curb this scourge (though some, including National Taxpayer Advocate Nina Olson,
noted that really good identify theft safeguards could delay people’s tax refunds for
months). Meanwhile, a Treasury Inspector
General for Tax Administration report found
problems with IRS customer service to victims of identity theft. ;e service said it was
working on it.
On the audit side, a survey of more than
900 auditors from ;rms of all sizes by audit
con;rmation service provider Con;rmation.
com found that 37 percent expect to uncover
fraud at their clients this year — though they
anticipated that their competitors would ;nd
fraud at a much higher rate of 66.9 percent.
Finally, there was an uproar when it was
discovered that Yahoo chief executive o;cer
Scott ;ompson didn’t have the computer
science degree he claimed to have; he “only”
had an accounting degree — as if he needed
anything else.
start, it delayed for a year the proposed effective date for cost basis reporting by brokers
for debt instruments and options, in Notice
2012-34. It also increased the tax-deductible
annual contribution limitation for health savings accounts, in Revenue Procedure 2012-
26. And it issued a trio of notices related to the
health care reform law, including how one
might determine whether a health insurance
plan provides “minimum value,” in Notices
2012-31, 2012-32 and 2012-33.
State tax o;cials are expanding their con-
cept of what constitutes a taxable economic
presence in their state as more economic activity moves online, according to a survey by
Bloomberg BNA. ;e shift is driven, in part,
by new technologies like cloud computing
and online group coupon sites.
;e chairman of the International Account-
ing Standards Board, Hans Hoogervorst, at a
conference in London in April, talked up the
potential of the Extensible Business Reporting Language, or XBRL, “to improve the e;ec-tiveness of ;nancial reporting.” ;e use of the
data-tagging technology has been catching
on globally, including in the U.S.
MAJOR MERGER
Major Texas ;rms Whitley Penn and Null-Lairson merged, expanding Top 100 Firm
Whitley Penn’s presence across the Lone Star
state. (See M&A Watch, on page 40.)
ACCOUNTANTS CONFIDENCE INDEX
In partnership with ADP®
Accounting Today’s
ACI: Ups, then downs S O N D J F M A M J 60 51. 2 53.72 54. 33 month 6 month
50
52.91
Breaking the positive trend
of the past two reports, this
month’s ACI took a dip in both
the short-term and the midterm, though our panelists still
expect mild growth in both.
They were less positive
about the short-term outlook
for growth at their small-business clients, where they expect
a very mild contraction in the
next three months. They also
reported the lowest expectations for their own growth in
the short term that we’ve seen
since we started collecting
data last fall.
INDEX COMPONENTS
;;;;;;;;;;;;;;;;;;;;;;
60
YOUR FIRM
60
SMALL BIZ
CLIENTS
60
MIDSIZED
CLIENTS
60
LARGE BIZ
CLIENTS
60
U.S. ECONOMY
Scale: ;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;
;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;
3 MOS. 6 MOS.
50
3 MOS. 6 MOS.
50
3 MOS. 6 MOS.
50
3 MOS. 6 MOS.
50
3 MOS. 6 MOS.
50
REACHING OUT MORE AND MORE
;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;
INCREASING CLIENT
COMMUNICATION/
MARKETING
INITIATIVES 42%
;e Committee of Sponsoring Organiza-
tions of the Treadway Commission postponed the release of the updated version of
its Internal Control-Integrated Framework to
the ;rst quarter of 2013, instead of the fall of
2012. (See story, page 16.)
Two Top 100 Firms named their next chief
executives: Mississippi-based Horne announced that Joe Havens would become
executive partner of the firm, succeeding
Hugh Parker. Havens started with the ;rm
in 1984, and became a partner at 30. At Den-ver-based RGL Forensics, meanwhile, Angie
MacPhee was named chief executive o;cer.
She joined the ;rm as chief ;nancial o;cer
in 2010, and was promoted to chief operating
o;cer last year.
EXPLORING
NEW MARKETS 28%
LAUNCHING
NEW SERVICES/
PRACTICE LINES
25%
In a major ruling, the Supreme Court e;ect-
ively limited the ability of the IRS to pursue
taxpayers over tax shelter cases for more
than three years, as opposed to six. ;e case
involved the limits of the government’s ability to collect tax de;ciencies stemming from
a taxpayer’s overstatement of the basis in
property, with the question being whether
the IRS must assess the owed taxes within the
ordinary three-year time limit, or a longer six-year period that the government favored.
INCREASING
STAFF TRAINING 21%
Tax preparation giant H&R Block an-
nounced plans to lay o; 350 full-time employees in its Kansas City, Mo., headquarters
and close approximately 200 of its underper-forming company-owned o;ces.
NONE 14%
0
10
20
30
40
50
60
70
When not being castigated about identity
theft, the IRS kept busy in other ways: To
Kenneth Leventhal, CPA, founder of one of
the largest CPA ;rms in the country, died on
May 8 at the age of 91. (See page 53.)
All responses from a May 2012 survey of the
Accounting Today Executive Research Council, an
online panel of over 1,500 accounting professionals.
The ACI was created in partnership with:
ADP and the ADP logo are registered trademarks of ADP, Inc.
