Click to return to iNEWS ARCHIVES page

This Week in the iNews:

▲ LUNCH AND LEARN SERIES PROGRAM #3 – ESTATE TAX PLANNING: WHAT TO EXPECT AFTER THE ELECTION

▲IRS CP-2057 LETTER – FROM THE DESK OF JOHN MACK

▲ FOCUS ON FRAUD: 2008 REPORT TO THE NATION ON OCCUPATIONAL FRAUD AND ABUSE © ACFE – Part 9

▲ Lunch & Learn Series Program #3 – Estate Tax Planning: What to Expect After the Election

“The Law Today, What It Might Be, and the Tools to Plan for Change.”

Please mark your calendar for Thursday, October 16, 2008 to attend the third installment of our Lunch & Learn Series, from Noon to 1:00p.m.

Complimentary Program, Lunch & Parking provided.

Make your reservations by email at mripley@pmcpa.com or calling (616)774-9004.

Seating is limited.

▲IRS CP-2057 Letter – From the desk of John Mack

The IRS is ramping up efforts to mail out notices in October to a wide group of people, noting that they may not be reporting enough income tax on their tax returns.

The new letter, CP-2057, tells recipients they may be underpaying, and instructs them to double check parts of the return and file an amended return, Form 1040X, if there is an error.

If you get one of these letters, you should respond. A CP-2057 letter would most likely show income omitted or an expense such as mortgage interest differences between what was reported on the return and what was reported to the IRS. It will ask the taxpayer to work with employers and others to correct errors in W-2’s, 1099’s, K-1’s, and other documents. Finally, it says, the IRS will scrutinize the following year’s return to see that similar problems don’t crop up.

The new notice is automatically generated using an IRS system of computer matching returns with 1099, W-2, K-1 and other documents, a system the IRS also uses for the notices it currently sends.

▲FOCUS ON FRAUD: 2008 REPORT TO THE NATION ON OCCUPATIONAL FRAUD AND ABUSE © ACFE – Part 9

This study is based on data compiled from 959 cases of occupational fraud that were investigated between January 2006 and February 2008 and published by the Association of Certified Fraud Examiners. All information was provided by the Certified Fraud Examiners (CFEs) who investigated those cases.

Executive Summary – Part 9, Victim Organizations: Types, Sizes, and Industries

As part of the survey, each respondent was asked to provide demographic information about the organization that was defrauded.

Types of Organizations

Frequency by type of organization: Private Company - - 39.1%; Public Company - - 28.4%; Governmental Agency - - 18.1%; Not-for-Profit - - 14.3%

Median Loss by type of organization: Private - - $278,000; Public - - $142,000; Governmental - - $100,000; Not-for-Profit - - $109,000

Size of Organizations

Frequency by size of organization: Less than 100 employees (i.e. small business) - - 38.2%; 100 – 999 employees - - 20.0%; 1,000 – 9,999 - - 23.0%; 10,000 and more - - 18.9%

Median Loss by size of organization: Less than 100 employees (i.e. small business) - - $200,000; 100 – 999 employees - - $178,000; 1,000 – 9,999 - - $116,000; 10,000 and more - - $147,000

Industries

Frequency by top 5 industries: Banking/Financial Services - -14.6%; Government and Public Administration - -11.7%; Healthcare - - 8.4%; Manufacturing - - 7.2%; Retail - - 7.0%

Median Loss by top 5 industries: Telecommunications - -$800,000; Agricultural, Forestry, Fishing and Hunting - -$450,000; Manufacturing - - $441,000; Technology - - $405,000 Construction - - $330,000

Next time: Executive Summary – Part 10 – Victim Organizations: Controls in Place and Effectiveness, and Controls Added in Response