Accounting Law Commons^™

A Complete Property Right Amendment, John H. Ryskamp

ExpressO

The trend of the eminent domain reform and "Kelo plus" initiatives is toward a comprehensive Constitutional property right incorporating the elements of level of review, nature of government action, and extent of compensation. This article contains a draft amendment which reflects these concerns.

Taxing Services Under The Eu Vat And Japanese Consumption Tax: A Comparative Assessment Of New Eu Place Of Taxation Rules For Services And Intangibles, Richard Thompson Ainsworth

Faculty Scholarship

Place of taxation rules are the seminal cross-jurisdictional provisions of any consumption tax regime. They determine where among competing jurisdictions a particular service is taxed. They are not important for transactions that are restricted to a single jurisdiction and to businesses or individuals belonging to that jurisdiction. However, when two or more jurisdictions are involved, these are the essential tools for revenue allocation and avoidance of double taxation.

It is therefore of considerable importance to Japanese businesses and consumers when the European Union (EU) undertakes a wholesale revision of the place of supply rules for services and intangibles. The European …

Corporations And Social Costs: The Wal-Mart Case Study, Benedict Sheehy

ExpressO

This article examines the role of the corporate vehicle in the creation of social costs. The article identifies some of the political commitments and philosophies behind the differing notions of corporations. Social costs are those activities which result from business activity and cause uncompensated harm to society. The founding contribution to the law and economics discussion by Ronald Coase is given a thorough treatment. The paper next, turns to the dominant explanation of corporate structure, namely the law and economics model developed expounded by Easterbrook and Fischel. It then applies the theoretical discussion in a case study of the world’s …

Predatory Structured Finance, Christopher L. Peterson

ExpressO

Predatory lending is a real, pervasive, and destructive problem as demonstrated by record settlements, jury awards, media exposes, and a large body of empirical scholarship. Currently the national debate over predatory mortgage lending is shifting to the controversial question of who should bear liability for predatory lending practices. In today’s subprime mortgage market, originators and brokers quickly assign home loans through a complex and opaque series of transactions involving as many as a dozen different strategically organized companies. Loans are typically transferred into large pools, and then income from those loans is “structured” to appeal to different types of investors. …

Digital Consumption Tax (D-Ct), Richard Thompson Ainsworth

Faculty Scholarship

Modern technology is dramatically changing the way consumption taxes are collected, but it is also changing the way policymakers assess the operation and impact of these taxes. Whether the design is a standard credit-invoice value added tax (VAT) of European design, or a retail sales tax (RST) of American design, or the credit subtraction VAT without invoices type of consumption tax (CT) of Japanese design, technology is having a profound impact.

Government certified transaction software is in place in the United States. The Streamlined Sales Tax offers taxpayers in 18 states the option of having their retail sales tax determined …

Financial Accounting And Corporate Behavior, David I. Walker

ExpressO

The power of financial accounting to shape corporate behavior is underappreciated. Positive accounting theory teaches that even cosmetic changes in reported earnings can affect share value, not because market participants are unable to see through such changes to the underlying fundamentals, but because of implicit or explicit contracts that are based on reported earnings and transaction costs. However, agency theory suggests that accounting choices and corporate responses to accounting standard changes will not necessarily be those that maximize share value. For a number of reasons, including the fact that executive compensation often is tied to reported earnings, managerial preferences for …

The Equivalence Approach To Securities Regulation, Tzung-Bor Wei

ExpressO

Abstract

In the past, academics and regulators debated two competing approaches to international securities regulation, namely “harmonization” and “regulatory competition.” More recently, a third approach to securities regulation has emerged – the “equivalence” approach. Under this model, a host country exempts foreign firms from certain host country rules when the firms’ home country rules are sufficiently similar, or “equivalent.” Many regulators have come to embrace equivalence, which is rapidly becoming a key principle in international finance.

This paper studies the concept of equivalence. It begins by defining “equivalence,” highlighting that different regulators manipulate the term to give it contrasting meanings. …

Bond Repudiation, Tax Codes, The Appropriations Process And Restitution Post-Eminent Domain Reform, John H. Ryskamp

ExpressO

This brief comment suggests where the anti-eminent domain movement might be heading next.

The Partnership: Preserving Capital Gains On Real Estate Investments, Charles E. Mcwilliams

ExpressO

This paper considers the use of partnerships as an effective tool for preserving capital gains on real estate investments. For tax purposes, the Internal Revenue Service generally treats a limited liability company as a partnership. This form of organization is widely used for real estate investments, and by taking a few simple precautions an LLC may ensure that any gain on its investments in undeveloped real property will be treated as capital gains. Such treatment may reduce the LLC’s tax costs substantially.

The Fifth Circuit developed a framework that has proven invaluable for analyzing the activity of the LLC to …

Priority As Pathology: The Pari Passu Myth, Riz Mokal

ExpressO

This paper aims to analyse the pari passu principle of insolvency law (which provides that the creditors of a company in liquidation are to be paid rateably), and to ask how it relates to other principles available for the treatment of claims in corporate liquidation. The discussion reveals that the principle has rather limited effect in governing distributions of the insolvent's estate. Not only do various types of secured claim fall beyond its ambit, even unsecured claims are often exempt from its application. Nevertheless, the principle thrives both in judicial rhetoric and in academic arguments. For example, many a challenge …

The Floating Charge – An Elegy, Riz Mokal

ExpressO

This paper argues that the usual way of conflating floating with fixed charges as small variations on a single theme – as priority-based devices differing only in degree – fundamentally misunderstands its true nature. The floating charge plays a distinctive role as a residual management displacement device which can only be effective if coupled with an appropriate set of fixed security that enables its holder to gather information about the competence of the debtor’s managers and to control their incentives to misbehave. The floating charge allows the debtor free use of its circulating assets while its management is doing well, …

The Valuation Of Distressed Companies - A Conceptual Framework, Michael Crystal Qc, Riz Mokal

ExpressO

It is often crucial to ascertain the value of a distressed company. Those interested in the company’s undertaking require this information to determine what should be done with the company’s business, and how the value in the company’s estate should be distributed amongst them. In this article, addressed primarily to the parties to corporate reorganisation proceedings in the UK and their advisers, we provide a conceptual framework within which these questions might be answered.

The first part of the article identifies the bases on which a company’s business might be valued. Drawing upon economic theory, empirical evidence, and the sophisticated …

Carousel Fraud In The Eu: A Digital Vat Solution, Richard Thompson Ainsworth

Faculty Scholarship

Recent reports from the UK's Office for National Statistics estimate (as of May 11, 2006) that Missing Trader Intra-community Fraud (MTIC) may exceed 10 billion pounds this year.

Carousel fraud, a variant of MTIC where the same goods are sold over and over again, exploits the lingering non-certified, non-digital attributes of the EU VAT. The UK believes that carousel fraud cost the Exchequer between 1.12 and 1.9 billion pounds in the 2004-05 financial year. This article proposes that carousel fraud be eliminated in the EU through selective insertion of Digital VAT functionality into the present system. In other words, it …

Enron And The Special Purpose Entity. Use Or Abuse? The Real Problem - The Real Focus, Neal F. Newman

ExpressO

In December of 2001, Enron Corporation filed for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code; one of the largest corporate bankruptcy filings at that time. When the investigations commenced and the tangled Enron web was unraveled, it was discovered that Enron had perpetrated a very sophisticated form of accounting fraud through its repeated use of what are referred to as Special Purpose Entities (“SPEs”). In their most basic forms, SPEs are business entities formed for the purpose of conducting a well specified activity such as construction of a gas pipeline, or collection of a specific group of accounts …

Measuring And Representing The Knowledge Economy: Accounting For Economic Reality Under The Intangibles Paradigm, Olufunmilayo B. Arewa

ExpressO

Enron has become a symbol: a symbol of excess, an illustration of how a company can base its business on fraudulent, deceptive or even largely non-existent business transactions. The collapse of Enron had a significant impact on the adoption of legislation such as the Sarbanes-Oxley Act, which was intended to prevent the types of fraudulent behavior that occurred at Enron. However, Sarbanes-Oxley and other responses to the business practices of many companies during the late 1990s do not fully address some of the underlying factors that permitted and in fact encouraged the Enrons of the world to represent their companies …

The Paradoxical Nature Of The Sarbanes-Oxley Act As It Relates To The Practitioner Representing A Multinational Corporation, Jason Thompson

Florida State University Journal of Transnational Law & Policy

No abstract provided.

Standards Of Practice For Pension Practitioners, 39 J. Marshall L. Rev. 667 (2006), David Pratt

UIC Law Review

No abstract provided.

"Reasonably Predictable:" The Reluctance To Embrace Judicial Discretion For Substantial Assistance Procedures, India Geronimo

Fordham Urban Law Journal

In United States v. Booker, the Supreme Court held that the Federal Sentencing Guidelines are no longer mandatory, yet still instructed sentencing courts to continue to advise the Guidelines. In light of this expanded judicial discretion, post-Booker cooperation, or 5K1.1, motions made by the government are of particular interest because it can have the potential to increase the court’s power while simultaneously limiting a prosecutor’s discretion by departing from the guidelines without any motion made from the government. While most appellate courts have been reluctant to affirm sentences that have been substantially departed from the guidelines in the absence of …

Subtle But Pervasive: Discrimination Against Mothers & Pregnant Women In The Workplace, Alison A. Reuter

Fordham Urban Law Journal

This Comment examines discrimination against mothers in the workplace, including discrimination against women on the basis of pregnancy, childcare, and breast-feeding, and proposes that new legislation is necessary in order to create equal opportunities for men and women, at work and at home. The Parental Discrimination Act (PDA) specifically tries to remedy the embedded assumptions and biases that lie beneath discrimination against pregnant women and mothers. Yet, until the embedded assumptions and biases that form the basis for the current work-family structure are eradicated, women and men will not be able to enjoy equal opportunities both at work and at …

The Death Penalty And The Debate Over The U.S. Supreme Court’S Citation Of Foreign And International Law, Yitzchok Segal

Fordham Urban Law Journal

The appropriateness of using foreign and international law in interpreting the U.S. Constitution has spawned passionate rhetoric and an ever-growing body of literature. Yet, the Supreme Court’s use of foreign and international law in interpreting the Constitution is not itself revolutionary, as the Court has freely drawn on supranational law throughout history. It is not the Court’s mere use of comparative legal sources that has sparked the recent debate, it is the context of these references. The Court has recently cited foreign and international law to support key positions in high-profile cases dealing with hyper-sensitive domestic issues, including the death …

“Special Delivery:” Where Do National Security Letters Fit Into The Fourth Amendment?, Lauren M. Weiner

Fordham Urban Law Journal

After the terrorist attacks of September 11, 2001, Congress passed the USA PATRIOT Act to aid law enforcement efforts to fight terrorism and broadened the scope of certain investigatory tools. One such tool, National Security Letters (NSLs), gives the government the authority to request certain types of transactional records without requiring judicial pre-approval and without giving the recipient a meaningful method to challenge it. This Comment examines NSLs both in the context of foreign intelligence and domestic criminal investigations and is primarily focused on how to classify NSLs and how to use them in a manner that reduces the potential …

Medicinal Marijuana And Palliative Care: Carving A Liberty Interest Out Of The Glucksberg Framework , Adam Hyatt

Fordham Urban Law Journal

In Gonzales v. Raich, the Supreme Court vacated the Ninth Circuit’s decision and held that the Controlled Substances Act was not an unconstitutional exercise of the Commerce Clause, yet never reached the substantive due process claim or the medical necessity. This Comment assesses whether there is a right to palliative care and focuses on the substantive due process claim available to the plaintiffs on remand. This Comment argues that, in view of the Court’s precedents, there is a right, subject to limitations, to use last-resort medical marijuana. In addition, the author determines that there is a fundamental right to palliative …

The Most Dangerous Profession, Rebecca Roiphe

Articles & Chapters

This article chronicles the history of the accounting profession and explains how it has consistently failed to preserve transparency in the markets and protect the public good. I argue that the culture of the profession is due in part to the failure of earlier administrative agencies to retain private auditors for public functions such as ratemaking. Drawing on this insight, I suggest that the culture of professions in general is shaped by the work that professionals do and functions that the profession has historically served.

The Regulation Of Public Auditing In Canada And The United States: Self-Regulation Or Government Regulation?, Adam C. Pritchard, Poonam Puri

Other Publications

Auditors play an important role as gatekeepers to public capital markets. By attesting to the accuracy of a company’s financial statements, the auditor lends its credibility to that company and its financial health.

Both market and legal mechanisms play a role in ensuring that auditors perform high quality audits. Reputation is critical in the market for auditors. In addition, potential legal liability to issuers and investors arising from contract, tort, and statutory securities laws creates incentives for auditors to conduct high quality audits. Potential discipline by professional self-regulatory bodies also plays a part. Striking the appropriate balance among market-based, legal, …

The Digital Vat (D-Vat), Richard Thompson Ainsworth

Faculty Scholarship

The most sustained U.S. tax policy debate of the past 30 years concerns proposals to replace and/ or supplement the Federal Income Tax with a consumption tax. Public finance economists and legal tax policy scholars challenged and defended the current income tax system on grounds of fairness, efficiency, and simplicity.

This debate over revamping the national taxing scheme has not been argued purely in the academic forum. Concrete legislative proposals have been advanced for a national retail sales tax, a European-style Value Added Tax, as well as a whole host of what David Bradford calls "the two-tiered consumption taxes."

From …