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Accountancy Slice
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4th March 2026
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THE HOT STORY

AICPA updates standards for auditors

AICPA's Auditing Standards Board (ASB) has released its work plan for 2026-2027 and a strategic plan for 2026-2030. Key priorities include updating standards to clarify auditor responsibilities regarding fraud, enhancing core attestation standards, and addressing sustainability assurance. The ASB is also considering new guidance on confirmations in financial statement audits and potential amendments to the going concern standard. Additionally, the board is focusing on the integration of artificial intelligence and data analytics in auditing practices. Jennifer Burns, AICPA chief auditor, said: "The ASB is focused on updating standards and guidance to help practitioners deliver quality engagements." For further details, visit the ASB's resource page.

TAX SOFTWARE

How to Optimize Your High-Volume Practice

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  • Identify the benefits of using ProConnect Tax
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  • Understand how to import QuickBooks data into a tax return
  • Establish familiarity with features especially valuable for larger firms such as tickmarks for review, batch e-filing, automatic apportionment for business returns, partnership special allocations, robust user notes with user, date and time stamping, and more  
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TAX

IRS raises passenger car depreciation limits

The IRS has announced an increase in depreciation limits for passenger automobiles in Rev. Proc. 2026-15, which reflects inflation adjustments based on the Chained Consumer Price Index. For vehicles eligible for bonus depreciation, the first-year limit is now $20,300, up $100 from 2025. Subsequent limits are $19,800 for the second year, $11,900 for the third year, and $7,160 for each year thereafter. If bonus depreciation does not apply, the first-year limit is $12,300, also a $100 increase. Additionally, the procedure outlines adjustments for leased vehicles, with deductions correlated to fair market values. According to the Bureau of Labor Statistics, used car prices fell by 2% while new car prices rose by 0.4% over the past year.

California gas tax debate heats up

California lawmakers are embroiled in a contentious debate over Assembly Bill 1421, which aims to study replacing the state's gas tax with a road use charge. The bill, introduced by Assembly Transportation Chair Lori Wilson, seeks to address the projected $31bn revenue shortfall over the next decade due to increasing fuel efficiency and the rise of electric vehicles. Wilson said: “California's transportation funding system is becoming less stable, less equitable and less sustainable.” Despite bipartisan support from various interest groups, the proposal faces significant political backlash, particularly from Republican lawmakers who claim it is a covert tax increase. Local officials express concern over deferred road maintenance, with Madera County Supervisor Robert Poythress emphasizing the urgency for reform, stating: “We’ve got to do something.”

Indiana tax relief for gratuities, overtime

Eligible Indiana residents earning gratuities or overtime in 2026 will not face state or county income tax when filing in 2027, thanks to the recently approved Senate Enrolled Act 243. State Sen. Travis Holdman said: “This legislation is about making sure Hoosiers keep more of what they earn.” The projected revenue loss from this tax relief could reach $237m, which will be offset by Indiana's reserve accounts, currently around $2bn. The future of these tax deductions will be determined by the 2027 General Assembly. Additionally, a new proposal will round cash transactions to the nearest $0.05 starting January 1st 2027. The bill has passed both the Senate and House and awaits the governor's signature.

FIRMS

KPMG appoints Gauthier Acket as Global Head of ESG

KPMG has appointed Gauthier Acket as Head of Global ESG, succeeding John McCalla-Leacy, who is retiring after leading the firm’s sustainability efforts since 2022. Acket, a nearly three-decade veteran of KPMG, previously served as Global ESG chief operating officer and client lead partner, where he supported clients in advancing their environmental, social and governance strategies. In his new role, he will lead the firm’s global ESG agenda, focusing on helping organizations deliver sustainable value, manage risk and support the transition to a low-carbon economy.

ECONOMY

Iran strikes could push up gas prices and complicate Fed’s inflation fight

U.S. and Israeli strikes on Iran have triggered a surge in oil prices, raising concerns about higher gasoline costs and renewed inflation pressures in the United States. Benchmark crude rose sharply following the conflict and is already up nearly 24% this year. Since oil prices are the primary driver of gasoline costs, sustained increases could quickly translate into higher prices at the pump. Economists estimate that a 5% rise in oil prices typically adds about 0.1 percentage point to annual inflation. While gasoline accounts for only about 3% of consumer spending, higher fuel costs can ripple through the economy by increasing transportation and shipping expenses. The overall impact will depend on how long the conflict and any energy-market disruptions last. If short-lived, the inflation bump could be modest and temporary. However, a prolonged spike, such as oil reaching $100 per barrel, could meaningfully lift inflation and make the Federal Reserve less likely to cut interest rates.

AUDIT & REPORTING

Dark-money group backing alternatives criticizes fiduciary watchdog in IRS filing

The Pinpoint Policy Institute has accused the Institute for the Fiduciary Standard (IFS) of violating IRS rules by failing to disclose its required annual nonprofit filings. Eric Ventimiglia, Executive Director of Pinpoint, said: "It is in the public interest for the IRS to investigate this violation," as he emphasized the importance of accountability in organizations influencing financial policy. The complaint comes amid ongoing efforts to expand 401(k) plans to include private investments, a move supported by the Trump administration. Despite the allegations, the IRS has not commented on the situation, and IFS President Knut Rostad has declined to respond. The controversy raises questions about transparency and accountability in nonprofit advocacy within the financial sector.

PERSONAL FINANCE

Navigating joint tax liability: What to know

In a recent case, Zaheen, TC Memo 2026-7, the Tax Court addressed the complexities of joint tax liability for married couples. When filing jointly, both spouses are typically liable for any tax deficiencies, even if one is unaware of fraudulent activities by the other. However, the court recognized that an "innocent spouse" may qualify for equitable relief under certain conditions. To be deemed an innocent spouse, one must prove they were unaware of the tax understatement and that holding them liable would be unfair. In this case, a wife, who was discouraged from managing finances and faced domestic abuse, was granted relief after her husband withdrew funds from her 401(k) without her knowledge. The court's decision highlights the importance of understanding tax responsibilities and the potential for relief in cases of undue hardship.

REGULATORY

U.S. Treasury weighs review of bank liquidity rules

Reuters reports that the U.S. Treasury Department and bank regulators are considering a comprehensive review of bank ​liquidity rules. They say existing rules are ineffective and impede lending. Treasury Secretary ⁠Scott Bessent said the current framework "has excessively and unnecessarily limited banks’ ability to ​do what they are supposed to do - lend." The Bank Policy Institute, which represents larger lenders, said: "Proper calibration of liquidity regulations will allow banks to deploy their excess liquidity to better support economic growth rather than ⁠government growth."

SMALL BUSINESS

Tariffs drove cost pressures for small U.S. businesses, Fed survey finds

U.S. small businesses faced significant cost pressures in 2025 due to tariffs and broader inflation, with more than four in ten firms reporting that tariff-related price increases created financial challenges, according to a Federal Reserve survey. Retail and manufacturing companies were the most affected, with 76% of firms passing some of the higher costs on to customers and 60% absorbing part of the increase themselves. The report also found rising adoption of artificial intelligence among small firms, with nearly half using artificial intelligence mainly for writing, marketing and productivity tasks, though it has so far had little impact on employment levels.

TECHNOLOGY

Accountants still battle data entry issues, despite AI gains

Despite advancements in technology, manual data entry remains a significant challenge for fund accountants, as highlighted in the second annual Dynamo Frontline Insight Report: Trends, Challenges, and Insights from Leading PE/VC Fund Accountants. Nield Montgomery, managing director of Dynamo's accounting business unit, said: “Accountants' long-standing challenges with data entry busywork don't always disappear in the early stages of artificial intelligence (AI) adoption.” The report reveals that 66% of accountants still cite time-consuming reporting and manual data entry as their top operational pain points. While integration issues persist, with 45% of accountants noting it as a challenge, there is a slight improvement from last year. Additionally, 82% of respondents emphasize the importance of data security in evaluating software solutions.
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