Category: Financial regulation

PCAOB Quote Regarding Audit Failure Rate Raises Concerns

Recently, the Wall Street Journal reported the shocking headline “One in Three Audits Fail, PCAOB Chief Auditors Says”.  The PCAOB is the Public Company Accounting Oversight Board, so such a statement certainly has the ability to rattle not only the the audit community, but all users of audited financials. Reading the context of the quote …

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IRS Reports its Investigative Wins

The IRS has released its Annual Business Report for 2013, detailing its investigative priorities and accomplishments during the year.  In terms of priorities, the focus has been on the following areas: Identity Theft Fraud Return Preparer Fraud & Questionable Refund Fraud International Tax Fraud Fraud Referral Program Political/Public Corruption Organized Crime Drug Enforcement Task Force …

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Permanent link to this article: http://betweenthenumbers.net/2014/02/irs-reports-its-investigative-wins/

SEC proposed rules for Regulation A+ filings

Section 401 of the Jumpstart Our Business Startups Act (the “JOBS Act”) added Section 3(b)(2) to the Securities Act. This directs the SEC to adopt rules exempting offerings of up to $50 million of securities annually from the registration requirements of the Securities Act. Last week, the SEC provided proposed rules to implement this portion …

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New Guide to Review Engagements

On December 10, 2013 the International Federation of Accountants released its guide for conducting review engagements.  The guidelines are particularly relevant for smaller firms conducting review engagements in compliance with International Standard on Review Engagements (ISRE) 2400 (Revised). The guide includes such helpful information as: illustrative examples relevant extracts from the standard practical points for practitioners’ …

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Fifth Circuit ruling re: Dodd-Frank Whistleblowers sets up Supreme Court appeal

In Asadi v. GE Energy (USA), L.L.C., No. 12-20522 (5th Cir. July. 17, 2013), the Fifth Circuit ruled that a whistleblower under Dodd Frank must report the complaint to the SEC to obtain whistleblower protection under Dodd-Frank. The Fifth Circuit summarized the statutory background and its ruling as follows: “Congress enacted Dodd-Frank in the wake …

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Fifth Circuit Takes Different Stance on Dodd-Frank Whistleblower Status

The U.S. Court of Appeals for the Fifth Circuit’s decision in Asadi v. G.E. Energy provides a new take on whistleblower protections under the Dodd-Frank Wall Street Reform and Consumer Protection Act.  The Court found that, by definition, a whistleblower must have reported the claimed violation(s) to the U.S. Securities and Exchange Commission (“SEC”) in …

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AICPA issues Financial Reporting Framework for Small and Medium Sized Entities

The AICPA has issued a new Financial Reporting Framework (“FFR”) for Small and Medium Sized Entities (“SMEs).  These smaller enterprises are often not required to prepare financial statements in accordance with Generally Accepted Accounting Principles (“GAAP”).  Yet all financial statements are presented in accordance with some financial reporting framework, however defined.  This new FFR provides …

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Permanent link to this article: http://betweenthenumbers.net/2013/06/aicpa-issues-financial-reporting-framework-for-small-and-medium-sized-entities/

Credit Report Errors Can Lead to Increased Cost of Debt

A recent study by the Federal Trade Commission (“FTC”) revealed that 20% of the over 1000 consumers who participated had an error on at least one of their three credit reports.  Even more troubling is that 5% of consumers had errors of such significance that it could cause them to overpay for certain products, such …

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SEC Hesitating To Impose Internal Audit Function Requirement On NASDAQ Companies

On March 4, 2013, NASDAQ issued a proposed new rule (Release No. 34-69030; File No. SR-NASDAQ-2013-032) which would require listed companies to have an internal audit function: “Each Company must establish and maintain an internal audit function to provide management and the audit committee with ongoing assessments of the Company’s risk management processes and system …

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Is Social Media the Right Medium for Public Company Announcements?

The SEC thinks it is.  On April 2, 2013, the SEC reported (see: here) that it is okay for U.S. Public companies to use social media to make announcements.  Companies must inform investors that they plan on using social media to do so and which medium they will use. The SEC announcement stated: There has …

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