US Audit Board’s Role Still Sparks Debate Two Decades Post-Enron
Congress is reconsidering the accounting guardrails it put in place more than two decades ago to ensure investors can trust the revenues and asset values listed companies publish.
Republican budget proposals would abolish the US audit regulator and reassign its work to the Securities and Exchange Commission. While lawmakers negotiate over what will end up in a final version of their tax and spending bill, the proposals have prompted debate over how best to regulate auditors and the role of the Public Company Accounting Oversight Board.
A member of the board and two former executives turned whistleblowers of once-corporate titans Enron Corp. and WorldCom Inc. spoke with Bloomberg Tax reporter Amanda Iacone about whether the audit regulator should remain independent or whether it would benefit from being folded into the federal government.
On this episode of Talking Tax, Sherron Watkins, a former Enron finance executive, and Cynthia Cooper, a former WorldCom chief audit executive, argue that Congress shouldn’t scrap an agency that oversees auditors that act as investors’ last line of defense.
To Christina Ho, a current PCAOB member who has objected to the board’s approach, moving auditor oversight to the SEC would counter what she sees as regulatory overreach and provide new opportunities to improve audit quality.
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29:54
Here's the Status of the GOP Tax Bill Moving Through Congress
The Republican-led Senate Finance Committee unveiled its portion of the mammoth tax-and-spending legislation that's quickly moving through Congress, and there's a lot to unpack.
The Senate bill has dozens of differences from the House version. It makes several business breaks permanent, softens the excise tax on university endowments, and phases out more slowly cuts to clean energy credits, while smoothing edges on the so-called "revenge tax."
But there are many similarities in the approaches the two bills take—both have tax breaks on income such as tips and overtime sought by President Donald Trump, and seek to extend much of the 2017 GOP tax law.
Things are moving quickly as the Senate aims to pass its version out of its chamber before the July 4 break.
In this week's episode of Talking Tax, Bloomberg Tax reporter Chris Cioffi speaks with host David Schultz on what's in the bill, what's left out, and where Congress goes from here.
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17:51
Big Four Layoffs Hit Amid Uncertain Time for Accounting Pipeline
Recent layoff announcements at Big Four accounting, tax, and consulting firms come as the industry faces economic uncertainty and a shrinking talent pool.
The accounting profession is at a crossroads as a new class of students graduate. While recent data shows heightened interest in both undergraduate and master's degree programs, the industry faces possible disruptions like workforce reductions and emerging artificial intelligence tools.
Deloitte LLP announced in April it would lay off government consulting employees as the Trump administration slashed federal contracts. The firm said in a statement the personnel actions were based on its public-sector clients' "evolving needs," among other factors.
PwC LLP plans to cut roughly 1,500 jobs, many in its tax and assurance practices, the firm said last month, after two years of historically low levels of turnover. The firm plans to slow down its campus recruiting and will offer fewer internships for next year.
But PwC announced this week it plans to reorganize its US advisory business, doubling the number of divisions from four to eight. The move "is being approached from a position of strength," according to a statement from PwC US advisory leader Tyson Cornell.
Peter Demerjian is the director of the school of accountancy at Georgia State University. Namaan Mian is the chief operating officer at Management Consulted, a professional training and coaching organization.
Demerjian and Mian spoke with Bloomberg Tax reporter Jorja Siemons about the recent layoffs, the industry's embrace of AI, and potential impacts on the industry's next generation.
Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.
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20:49
Why Markets Fear Impact of House GOP's Proposed Retaliatory Tax
The “revenge” tax provision that’s in the giant tax bill working its way through Congress has a lot of people worried.
Known as Section 899, the provision would impose stiff, retaliatory tax rates on companies and people from countries that the US deems to be imposing "unfair" and "discriminatory" taxes against US companies. It was included in the version of the bill House Republicans narrowly passed last month, and now gets Senate attention.
The aim of Section 899 is to push those countries into changing their policies, but many observers fear the move would lead to lower foreign investment in the US, costing American jobs and cutting into economic growth.
That’s not the only reason for concern. Financial markets are worried about the retaliatory tax’s potential impact on the value of US assets. Some observers think Section 899 would damage the US’s longstanding reputation as a stable, reliable place for global companies to do business and for global investors to put their money,
On this episode of Talking Tax, Bloomberg Tax senior reporter Michael Rapoport explains the retaliatory-tax proposal and discusses its prospects for becoming law.
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14:31
International Provisions in GOP Tax Bill Face Senate Changes
Companies scored wins after the House passed a multi-trillion-dollar tax bill that largely preserved the current tax rates on foreign-earned income.
Republicans' 2017 Tax Cuts and Jobs Act created a new international tax regime including a minimum tax on global intangible low-taxed income, or GILTI, a reduced tax rate on foreign-derived intangible income, or FDII, and a base erosion and anti-abuse tax, or BEAT.
Each of these tax rates will go up in 2026 without congressional action, but House lawmakers made slight changes that will result in minimal tax increases.
But the debate isn't over. The bill now heads to the Senate, where tax practitioners and companies expect impactful changes to the mammoth legislation, including the international provisions.
On this week's episode of Talking Tax, reporter Lauren Vella talks about the House provisions, what companies want to see in the Senate version of the tax bill, and how the legislation might impact US relations with other countries.
Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.
Talking Tax, from Bloomberg Tax, is a weekly discussion of the most pressing issues facing tax and accounting professionals. Each week the podcast features discussions with lawmakers, federal regulators, lawyers, and journalists. From the courts to Capitol Hill to the IRS, Talking Tax has it covered.
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