Cao used a theory called “redemption” or “commercial redemption” – which prosecutors called a “rejected tax defier theory.” This theory claims that the U.S. Treasury keeps millions in a secret treasury account for each taxpayer. The secret account can be used to pay a taxpayer’s debts and tax liabilities if a taxpayer sends the IRS and banks certain documents, the theory goes.

“Cao’s theory is complete fiction,” the complaint reads.

I am pretty sure that his clients didn’t pay too much for his valuable tax advice. You get what you pay for.

I once reviewed my parents’ tax return which was prepared by some hack with an office and a computer with tax software installed. I’m not a tax CPA, but I’m pretty sure that it’s not a good idea to tell married couples to fraudulently file as “single”.

• Net worth of $1 million excludes the value of the investor’s primary residence.
• The SEC can revise the definition for the first four years following enactment of the act.
• Within the next four years the definition of accredited investor must include an increase to the net worth threshold.
• SEC is required to review the definition of net worth every four years.
• the net worth amount will not be go below a $1 million floor.

The article briefly mentions that issuers will consider an alternatives to this a law by using Rule 144a but doesn’t adequately explain what 144a is. A good explanation of 144a is here.

SEC said [Dell] also failed to disclose to investors large payments it received from Intel Corp. in exchange for not using central processing units made by Intel’s main rival, Advanced Micro Devices Inc

ASU No. 1810-100, Accounting for Financial Instruments and Revisions to the Accounting for Derivative Instruments and Hedging Activities — Financial Instruments (Topic 825) and Derivatives and Hedging (Topic 815) would, according to the FASB, result in common fair value measurement and disclosure requirements in U.S. GAAP and IFRS, including word changes to describe the principles and requirements.

The impairment test and expanded use of fair value measurements in the proposed ASU 1810-100 has caused a stir in the banking industry. Banks say that changes in the accounting standards will require them to beef up their reserves and scale back loan originations. If this happens, businesses may find it even more difficult to get a line of credit.

Comments on this proposed standard is due September 7, 2010

The Dodd-Frank Wall Street Reform and Consumer Protection Act, will have an impact on public companies. 

The bill, if passed, calls for shareholder votes (PDF) on executive compensation. The “say-on-pay” provision of the bill may alter the annual proxy process. The bill calls for hareholder votes on executive pay to take place within six months of the bill’s enactment. The SEC will have to act quickly to implement the bill.

A “say-on-pay” rule already applies to recipients of government aid under the Troubled Asset Relief Program. The current bill extends it to all public companies; however, it does allow the SEC to exempt an issuer or class of issuers. 

The bill also require public companies to: 

• hold shareholder votes every three years on executive compensation
• consider increasing the frequency to annual or bi-annual votes every six years 

Shareholders may make proposals, independent of management, on executive compensation practices. These proposals may be off-cycle; that is, they don’t have to fall within the three year and six year cycles noted above. 

The bill also requires that compensation committee members be independent. 

Posted via email from Michael Doan

The Public Company Accounting Oversight Board is not formally a government agency. As such, they don’t have to adhere to government pay schedules. This means that board members are paid more that $500,000 per year. Not a bad job if you can get it.

Posted via email from Michael Doan