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The Treasury Department has announced that some $20bn of the Internal Revenue Service’s enforcement fund is effectively frozen, due to the current law which governs federal spending. Deputy Treasury Secretary Wally Adeyemo stated: “Our concern right now is that because of this risk to the IRS and the uncertainty of it, the IRS is going to potentially have to make dramatic decisions about stopping hiring. They are running low on enforcement dollars today.” He also noted that the IRS requires this money in order to carry out its role properly, with some 2,000 fewer audits of large corporations years and 6,000 fewer of high-income individuals likely to take place without it in the next five years. Congressional spending fights between Republicans and Democrats are likely to complicate efforts to resolve the issue.

 

Wall Street Journal

A recent survey by Empower reveals wide gaps in compensation expectations among different generations. A report on the survey notes that "For CFOs and finance teams, possibly working with HR to prepare for future compensation raises and packages, new data suggests it may be important to consider the age of an employee and how that will determine their judgment of the compensation they’re offered." Data from the survey reveal that the average American employee considers a salary of $270,214 the threshold for success. The article also notes that "Physical well-being, an area many CFOs credit for their success, was also deemed a top success metric by 35% of respondents."

 

CFO.com

With new data from the Network Contagion Research Institute and Rutgers University suggesting that diversity, equity and inclusion (DEI) initiatives can increase conflict in the workplace, CFO.com reports on the importance of the role CFOs play in the decision-making process related to such programs. With companies spending some $8bn a year on DEI programs, CFOs are central to the issue. 

 

CFO.com

The PCAOB has approved new requirements for auditing firms to report on various metrics related to their audits and practices. PCAOB chair Erica Williams stated: "The goal of this project... is to provide additional information about audit firms and their audits in both a consistent and comparable manner." The new rules will require PCAOB-registered firms auditing accelerated filers to report specified metrics annually on a new Form FM and engagement-level metrics on a revised Form AP. The PCAOB has also modernized its annual reporting requirements to enhance transparency. However, board member Christina Ho expressed concerns about the haste of the adoption process, noting it was the fastest in PCAOB history. The amendments are pending approval from the SEC and will be implemented in phases.

 

Accounting Today

Wall Street Journal

The FASB is addressing the confusion surrounding non-GAAP financial measures by seeking input on standardizing these metrics through its Invitation-to-Comment (ITC) 2024-ITC100, titled “Financial Key Performance Indicators for Business Entities.” This initiative aims to enhance transparency and comparability, as the current lack of consistency in non-GAAP measures has frustrated investors. FASB's move is significant, as it could lead to more uniform reporting practices, allowing investors to make better-informed decisions. The ITC is open for feedback until April 30, 2025.

 

The CPA Journal

Eastman Kodak plans to unlock as much as $585m by terminating its U.S. pension plan fund, which covers around 35,000 participants. Chairman and Chief Executive Jim Continenza remarked: “The intent is to strengthen the health of the business." If the proposal is approved by the Board and goes ahead, the company expects to put a new retirement plan in place for current employees. Mr Continenza added: “The key is to continue to strengthen the shareholders’ value of the company."

 

Wall Street Journal

A profile of Chipotle Mexican Grill’s new CFO Adam Rymer notes the challenges posed by inflation for its ingredients and the possibility that it will have to raise prices to address these. Rymer believes customers of the chain will not be put off by a “modest” price lift. He also describes the cost-saving technologies the company is investing in, such as a produce slicer: “We dice somewhere around 20 to 30 pounds of onions on a daily basis in each restaurant. This makes dicing quicker and makes the cut size more consistent."

 

Wall Street Journal

Bath & Body Works has upgraded its forecast for full-year adjusted profit and predicted a smaller drop in annual sales on robust demand for its candles and fragrances during the holiday season. The news sent the retailer's shares up about 22%. "We believe we are well-positioned to navigate a volatile retail environment and shorter holiday calendar," said CEO Gina Boswell, adding the retailer was well positioned for any tariff fluctuations during Donald Trump's presidency due to 85% of its products being manufactured in North America.

 

Reuters

U.S. consumers are "ready to open their wallets this holiday season," the Conference Board has said ahead of Black Friday on November 29th. A survey by Morgan Stanley found that 35% planned to spend more this holiday season - but nearly two-thirds of shoppers said they would pass on a purchase if an item is not adequately discounted, meaning a price cut of more than 20%. "It's gonna be a good year, but I don't think that growth is going to be spectacular because consumers are still under pressure," predicted Neil Saunders of GlobalData. "There is still a perception among consumers that things are quite difficult," Saunders continued. "So people are being quite cautious and careful in their spending." He also noted that mooted Trump administration tariffs are not on consumer radars for the 2024 season.

 

AFP

Florida Chief Financial Officer Jimmy Patronis has stated in his resignation letter from that post that he intends to run for U.S. Congress, he indicated in a resignation letter circulating online. President-elect Donald Trump responded to the announcement on social media, saying "Should he decide to enter this Race, Jimmy Patronis has my Complete and Total Endorsement."

 

Fox News