SEC Penalizes Deutsche Bank for Questionable Accounting Issues
Accounting mistakes can happen to anyone, whether you’re self-employed, have a small business with just a few employees, or you run a major corporation. However, even when mistakes happen, the consequences can be damaging. When those mistakes, or irregularities, involve large organizations like corporations, banks and financial institutions the consequences can be severe.
Recently, the U.S, Securities and Exchange Commission decided to fine Deutsche Bank for financial accounts that were reportedly misstated as the most recent financial crisis in 2008 and 2009 was reaching its peak. According to reports, U.S. officials stated that the bank undervalued the risk on its books by incorrectly accounting for so-called gap risk as they pertained to LSS trades. The U.S. Securities and Exchange Commission fined the bank $55 million for the alleged improprieties.
Deutsche Bank claimed that it used such procedures because there were no reliable models available at the time to properly measure gap risk. The problem with understating gap risk is that it could make it seem that the bank’s books were actually stronger than they really were. The $55 million fine finally brings to a close a prolonged investigation into the valuation of complex derivatives.
Accounting policies and practices are very important for anyone, but especially public corporations that are under the watchful eye of the Securities and Exchange Commission. At GROCO we can help your company or financial institution, large or small, with all of its accounting needs. Just contact us for assistance by clicking here, or call us at 1-877-CPA-2006.
Tax S-corporation
Saving Taxes with an S Corporation An S corporation election allows the shareholders to preserve the benefit of limited liability for the corporate form while at the same time being treated as partners for federal income tax purposes. Ever wondered why so many small businesses operate as an S corporation? Simple. An S corporation saves…
Sec1045 Partnerships
Sec1045 Partnerships This document contains final regulations relating to the application of section 1045 of the Internal Revenue Code (Code) to partnerships and their partners. These regulations provide rules regarding the deferral of gain on a partnership’s sale of qualified small business stock (QSB stock) and a partner’s sale of QSB stock distributed by a…
Sec179 Businessequipment
Updated: 11/12/10 Most new business equipment can be either depreciated over its useful life or expensed immediately under Internal Revenue Code Section 179. The maximum deduction is based on the following schedule for the date in which the tax year begins. Each 1040, whether Single or Joint, is limited to one maximum. 179 expenses passed…
Sec1244 Small Business Stock Sales
Sec1244 Small Business Stock Sales Section 1244 of the Internal Revenue Code, the small business stock provision, was enacted to allow shareholders of domestic small business corporations to deduct as ordinary losses, losses sustained when they dispose of their small business stock. In order to receive this beneficial treatment, the Code prescribes specific requirements for:…