Source: accountancy age.com 2 January 2018
PwC auditors were negligent as they failed to detect over $2bn fraud at Alabama’s Colonial Bank which led to its collapse in 2009, according to a US federal judge.
The Federal Deposit Insurance Corporation (FDIC) incurred a cost of $2.8bn after Colonial’s collapse and brought a professional negligence claim against PwC.
US district judge Barbara Jacobs Rothstein said that as auditor of parent company Colonial BancGroup, PwC failed to perform adequate checks and could have done more to prevent the bank’s collapse. The firm failed to respond to red flags and the judge will now consider whether PwC should be liable for damages.
“United States: Anti-Inversion Rules Are Not Just For Mega-Mergers – Private Client Advisors Take Note”
Source: Ruchelman PLC via mondaq.com 7 December 2017
“Transactions known as corporate “inversions” or “expatriations” have made headlines for years. Recently, the proposed merger of the U.S. pharmaceutical giant Pfizer, Inc. with the Irish-based pharmaceutical company Allergan Plc was in the news. The coverage addressed the implications of creating the world’s largest pharmaceutical company, the loss of yet another American corporate behemoth to a lower-tax jurisdiction, and later, the plan’s cancellation, arguably as a result of the U.S. government’s regulatory action.
As laws limiting tax-free inversions have developed, tax attorneys specializing in corporate mergers and acquisitions have been required to keep up with regulatory developments and consider new planning techniques – but they are not the only ones with such obligations. Tax attorneys advising individuals and families who own closely-held businesses, investment structures, and even personal use property, with cross-border aspects, must also keep the inversion rules on the forefront of tax planning. In the private client setting, inversions are sometimes overlooked, perhaps because the issue is so closely associated with large “M&A” deals.
This article examines how the inversion rules can affect cross-border tax planning for individuals. It begins with a brief discussion on the development of the inversion rules over time and some of the planning techniques that have been used to address the legislative and regulatory changes.”
Source: McDermott Will & Emery via internationallawoffice.com 27 October 2017
US “Taxpayers faced with the prospect of litigation need to carefully consider in which forum they will litigate their case. Once that decision is made, it may not be possible to dismiss the case and seek to refile in a more favorable forum.”
Source: economia.icaew.com, 12 April 2017
“Six individuals in total have been let go by KPMG after it discovered they had received advance warnings of what audits were to be inspected by US regulator the Public Company Accounting Oversight Board (PCAOB).
The leaks potentially undermined the integrity of the regulatory process and violated KPMG’s code of conduct.
The firm learned in late February from an internal source that an individual who had joined KPMG from the PCAOB subsequently received the confidential information from a then-employee at the regulator.
KPMG said that it immediately reported the situation to the PCAOB and the Securities and Exchange Commission (SEC).
Following an internal investigation, the firm found that the six KPMG individuals either had improper advance warnings of engagements to be inspected by the PCAOB, or were aware that others had received such advance warnings and had failed to properly report the situation in a timely manner.”
Source: Fitzpatrick, Cella, Harper & Scinto via internationallawoffice.com, 09.01.2017
On December 6 2016 the Supreme Court heard oral argument on the interpretation and application of 35 USC Section 271(f)(1) in Life Technologies Corporation v Promega Corporation.
At issue is whether the export from the United States of a single component of a patented multi-component invention, which is later assembled outside the United States, qualifies as an infringing act under 35 USC Section 271(f)(1).
US manufacturers and exporters are closely following this case, seeking clarity on how the courts will assess what constitutes a ‘substantial portion’ of an invention, what factors will be considered in this analysis and how the Supreme Court decision may affect their global business practices.