General Business
Average retail gas prices have dropped about 11 cents per gallon over the last two weeks.
But pump prices are still about 91 cents higher than a year ago, according to last week’s report from the the U.S. Energy Information Administration.
As a result, the IRS has increased the optional standard mileage rate for business use of an automobile from 51 cents per mile to 55.5 cents per mile.
The change is effective July 1, 2011.
You can find more information from the IRS at http://www.irs.gov/newsroom/article/0,,id=240903,00.html
General Accounting, General Business
Here’s a question we’ve asked more than a few times:
Should there be one set of financial reporting standards for large publicly traded companies (“Big GAAP”) and a separate set for smaller privately held companies (“Little GAAP”)?
Another question:
Wouldn’t we all benefit if the accounting standards and financial reporting requirements for private companies address private company needs without the burden (and related costs) of public company reporting?
The answer to both? Yes!
We said yesterday – we’re thisclose to seeing Little GAAP become a reality.
The AICPA has endorsed the recommendations of a Blue Ribbon Panel to create a new private companies board and modify financial reporting and accounting standards where warranted for private companies.
The Financial Accounting Foundation (FAF) will soon issue its proposal and action plan on these historic Blue Ribbon Panel recommendations.
The Foundation wants to hear from financial statement users, including lenders, business owners and other interested parties. We encourage everyone to contact the FAF to support the Blue Ribbon Panel recommendations.
The AICPA has provided a sample letter assistant which you can find at https://apps.aicpa.org/pcfr/.
Please take a few minutes to complete and e-mail the letter.
We’ve been waiting for this since the mid 70s and we’re thisclose.
You can find a summary report at http://www.duganlopatka.com/images/PDF/aicpa_call_to_action.pdf
The full FAF report is available at http://www.accountingfoundation.org/cs/ContentServer?site=Foundation&c=Document_C&pagename=Foundation/Document .
General Accounting, General Business
The Financial Accounting Standards Board (FASB) has long held the belief that “one size fits all” for financial statement reporting and accounting standards.
But the needs of financial statement users are often different for public companies than for private companies. And the complexities of financial reporting standards have grown dramatically in the post Enron era.
So should there be one set of financial reporting standards for large publicly traded companies (“Big GAAP”) and a separate set for smaller privately held companies (“Little GAAP”)?
Our answer, which is widely shared, is a definitive Yes!
The AICPA has endorsed the recommendations of a Blue Ribbon Panel to create a new private companies board (separate from FASB) and modify financial reporting and accounting standards where warranted for private companies.
The Financial Accounting Foundation (FAF) – which oversees FASB – will soon issue its proposal and action plan on these historic Blue Ribbon Panel recommendations.
We’re thisclose to seeing Little GAAP become a reality. However, that will only happen if enough interested parties express their views to the Financial Accounting Foundation on this important issue.
We encourage everyone to contact the FAF to support the Blue Ribbon Panel recommendations.
The AICPA has provided a sample letter assistant which you can find at https://apps.aicpa.org/pcfr/
More on this very important topic tomorrow.
General Business
Chicago-based Giordano’s filed for Chapter 11 bankruptcy protection back in February, after defaulting on about $45 million in loans from Fifth Third Bank.
The pizza chain – well known for it’s Chicago-style stuffed pizza – has over 50 restaurants, including 35 franchisee locations.
Giordano’s current owner, John Apostolou, was recently forced to relinquish control of the company, after he fired his bankruptcy attorney.
According to a Chicago Tribune article, he then filed his own court affidavit – in which he claimed he doesn’t recognize U.S. currency and was free of any legal constraints.
The article goes on to note that Apostolou may be associated with an anti-government group known as “sovereign citizens.”
I hadn’t heard of the term “sovereign citizen” before. Turns out they don’t believe U.S. courts have any jurisdiction over them.
And they don’t believe in paying taxes. That sounds like a tax scam to me. The IRS might call it a “frivolous tax argument”.
You can find the Tribune article at http://www.chicagotribune.com/business/ct-biz-0612-giordanos–20110611,0,1118609.story
And to learn more about frivolous tax arguments, check out the IRS website at http://www.irs.gov/taxpros/article/0,,id=159853,00.html .
Oh, and to find a Giordano’s near you, go to http://www.giordanos.com/locations.html .
They also ship pizza overnight anywhere in the continental U.S.
Tax Planning
The Decision - Part I LeBron James picks the Miami Heat !
The Decision – Part II Dallas Mavs beat the Miami Heat to win NBA Title!
Last year we said LeBron James would go to the Miami Heat – if he listened to his tax advisors. That’s because Florida doesn’t have a personal state income tax. ( http://blogs.duganlopatka.com/general/2010/07/08/lebron-james-and-state-taxes/ ).
Sure enough – James headed to South Beach to join DeWyane Wade and Chris Bosh.
Sunday night the Dallas Mavericks beat the Miami Heat 105-95 to win their first NBA title.
Texas doesn’t have a personal state income tax either. Hmmm.
The Bulls have Derrick Rose – but we also have a 5% state income tax rate. So it might be hard to attract a true shooting guard which the Bulls sorely need.
We’ll stay away from Bulls predictions until the “temporary” tax increase drops back down. The rate is set to drop to 3.75% in four years. Then the rate drops again to 3.25% way out in 2025.
Right.
In the meantime, if you’re thinking of taking your talents to another state, check out the Tax Foundation state by state income tax guide at
http://www.taxfoundation.org/taxdata/show/228.html
General Business
April 12 was Tax Freedom Day according to The Tax Foundation, a D.C. based tax research organization.
That’s the day they estimate we earned enough money to pay all our federal, state, and local taxes for the year.
How does that translate into an 8 hour work day?
The Tax Foundation estimates that we work 2 hours and 13 minutes of every 8 hour work day just to pay taxes. So if you start at 9:00 a.m., you’ve paid your share of taxes at 11:13 a.m.
If you add in your share of the deficit, you’re working into the lunch hour – 12.07 p.m. – before you start earning money for yourself.
The Foundation report also breaks down the analysis by the type of tax and state by state (Illinois has the 9th highest tax burden in the country).
You can find more on “Tax Bite in the Eight-Hour Day” at http://www.taxfoundation.org/publications/show/27256.html
