September 2011 archive

Goodwill Impairment Tests Become Easier

The Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2011-08, entitled “Testing Goodwill for Impairment”. This amends guidance in Generally Accepted Accounting Principles (GAAP) Topic 350 involving goodwill and other intangible assets. Because early adoption is allowed, and the new guidance simplifies significantly the current procedures, expect the new guidance to be widely implemented …

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New Mortgage Limits

On October 1, 2011, Fannie Mae and Freddie Mac will reduce the size of mortgages it purchases.  The new lower limit will be $625,500, down from the current $729,750.  For most of the United States, this should be no big deal.  However, in some pricey places, this change can really hurt borrowers.  Limits are set …

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Surprising Survey Covering SEC Whistleblower Program

Accounting and consulting firm BDO USA, LLP conducted an August 2011 annual national telephone survey entitled “The 2011 BDO Board Survey”. Interviewers spoke directly to 101 board members for public companies with revenues ranging from $250 million to $750 million. Although the survey covered other corporate governance matters, this post involves required whistleblower reporting systems. …

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30,000 Tax Cheats Confess Under IRS Programs

The IRS has created two disclosure programs where approximately 30,000 tax cheats have come clean.  The IRS has created these voluntary disclosure programs in a larger effort to identify and pursue U.S. taxpayers who avoid paying taxes by hiding assets in overseas accounts.  Efforts by the IRS began in 2009, after Swiss bank UBS AG agreed to …

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$535 million U.S. Loan to Solyndra was predicted to be a failure

Solyndra was a manufacture of solar cells based in Freemont California. In August & September 2011, Solyndra ceased all business activity, filed for Chapter 11 bankruptcy, and laid off all employees. The federal government is Solyndra’s largest creditor, having made the company a $535 million loan guarantee. The interesting thing about this loan is not …

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Report Identifies Top Undergraduate Business Programs

US News and World Report has unveiled its current listing of the top colleges, including various subcategories such as Best Undergraduate Business Programs.  The top five include three public universities and are as follows: University of Pennsylvania Massachusetts Institute of Technology University of California – Berkley University of Michigan – Ann Arbor University of Virginia New York University, …

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In Lieu of Flowers…Social Security Sends $$

There is significant and valid concern over the government’s ongoing ability to maintain Social Security payment commitments.  Given these issues, one might reasonably expect the Social Security Administration to safeguard the existing assets.  Guess again. The Social Security inspector general estimates that $40 million was paid out to deceased beneficiaries.  These erroneous payments did not …

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Baby Boomers Not Planning to Leave Much Behind

According to a recent survey of millionaire baby boomers by investment firm US Trust, many are making a surprising decision regarding their financial planning.  Rather than planning to leave behind a sizeable estate, they intend to substantially exhaust their funds prior to death.  Less than half of those surveyed said leaving money to their children was …

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Government Slaps Banks with Lawsuit over Toxic Mortgages

The U.S. Government sued 17 financial firms today, including some of the U.S.’ largest banks, for selling Fannie Mae and Freddie Mac billions of dollars of toxic mortgage back securities.  The suits was filed by the Federal Housing Finance Agency, which overseas both Fannie Mae and Freddie Mac.  Residential mortgage-backed securities were risky investments that turned …

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It pays to eat your veggies!

An unemployed carpenter in Northern Illinois was picking broccoli in his backyard garden when he stumbled upon a duffle bag, nestled among the peppers and filled with a different kind of green: approximately $150,000 in cash. According to the Northwest Herald, a combination of honesty and suspicion as to the source of the funds (and who …

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