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Erica Williams, chair of the PCAOB, is set to depart on July 22nd, following a narrow escape from a proposal to transfer the non-profit's responsibilities to the SEC. The Senate Parliamentarian recently rejected a provision in the One Big Beautiful Bill Act that would have dissolved the PCAOB. The announcement was made by SEC Chair Paul Atkins, who said he had asked her to resign. “I know you have questions about what is next for PCAOB leadership. Unfortunately, I do not have the answers you deserve,” Ms. Williams said in an email to staff. She added: "The PCAOB plays an essential role in protecting the investments and retirement savings of workers and families across the country while helping to ensure our capital markets remain the envy of the world. With high economic uncertainty increasing the risk of fraud, the PCAOB's mission is as important as ever. It's critical the expert PCAOB staff continue to be empowered to carry out their work of ensuring American investors are protected." Her leadership focused on modernizing auditing standards and enhancing enforcement, making her departure a pivotal moment for the PCAOB amid ongoing regulatory challenges.

 

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AICPA is advocating for a reevaluation of the US audit board following unsuccessful attempts in Congress to abolish the regulator. Mark Koziel, AICPA president and chief executive, stated: “What an incredible time to kind of rethink what it is that we're trying to accomplish,” as he emphasized the need to reassess the mission of the PCAOB. The board was established to restore investor confidence in corporate financial statements after significant accounting scandals in the early 2000s.

 

Bloomberg Tax

Recent data indicates that the U.S. trade war is beginning to impact consumer prices significantly. The Labor Department's Consumer Price Index rose to 2.7% in June compared to the previous year, with core inflation, which excludes food and energy prices, at 2.9%. "With increases in categories like household furnishings, recreation, and apparel, import levies are slowly filtering through," wrote Seema Shah, chief global strategist at Principal Asset Management. "It would be wise for the Fed to remain on the sidelines for a few more months at least.” The inflation figures are moving further from the Federal Reserve's 2% target, with expectations that interest rates will remain steady at 4.25%-4.50%. Amidst political tensions, the futures market predicts a potential rate cut in September. President Donald Trump on social media said that consumer prices were "LOW" and repeated his call for the Fed to cut rates. The consumer price level was about 1.2% higher in June compared to December, the last full month before Mr. Trump started his second term.

 

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Wall Street Journal

Manufacturing activity expanded for the first time in five months in New York State, according to the Empire State Manufacturing July survey. The diffusion index for General Business Conditions rose 21.5 points to 5.5, well above the forecast of -8.3.  The new orders index rose sixteen points to 2.0, suggesting that orders edged up, and the shipments index climbed nineteen points to 11.5, its highest reading in several months. The index for number of employees rose five points to 9.2, and the average workweek index rose to 4.2.

 

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Investing

Meta Platforms chief executive Mark Zuckerberg has announced that the Facebook parent company will invest hundreds of billions of dollars to construct several large artificial intelligence data centers aimed at advancing superintelligence, with the first center, Prometheus, expected to be operational by 2026. His ambitious plan includes the establishment of multiple "titan clusters," one of which will cover a significant area comparable to Manhattan, as Meta seeks to enhance its competitive edge in the AI sector amid a talent acquisition drive for top engineers.

 

Reuters

The Consumer Financial Protection Bureau (CFPB) has become largely inactive under the Trump administration, with employees reporting a significant decline in productivity. One employee described the situation as “quite demoralizing,” highlighting a shift from protecting consumers to inaction. The bureau, which has returned approximately $21bn to consumers over its 15-year history, is now focused on reversing previous regulations. Recent actions include rescinding agreements with companies including Navy Federal Credit Union and Toyota, allowing them to avoid penalties for wrongdoing. A report by Sen. Elizabeth Warren (D-MA) revealed that the bureau is processing only 2,200 complaints daily, a stark drop from 10,500. With funding cuts looming, the CFPB faces potential mass layoffs, leaving employees in a state of uncertainty and frustration.

 

US News and World Report

In a recent ruling, the U.S. Tax Court addressed a case involving Sand Valley Holdings, LLC, which claimed a charitable contribution deduction of $35.38m for a conservation easement donated in 2016. The IRS disallowed the deduction and imposed penalties, asserting that the necessary supervisory approval for these penalties was obtained in compliance with section 6751(b)(1). Judge Lauber stated, “We conclude that Ms. McCarter timely approved the penalties,” affirming the IRS's position. The court granted the IRS' Motion for Partial Summary Judgment, indicating that no material facts were in dispute regarding the approval process. The ruling emphasizes the importance of proper supervisory procedures in tax assessments.

 

Tax Notes

The SEC has moved to drop a long-running bribery case against two former executives of Cognizant Technology Solutions. In a filing in the Newark, New Jersey federal court, the SEC said it dismissed claims against Gordon Coburn and Steven Schwartz "in the exercise of its discretion and as a policy matter," and not on the merits. Coburn and Schwartz were charged by U.S. authorities in February 2019 with authorizing a $2m bribe to an Indian official for helping to obtain a construction permit for a new Cognizant office in Chennai. Bloomberg describes the move as the latest sign of the Trump administration’s shift away from enforcing the Foreign Corrupt Practices Act.

 

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Michael Miller from Roberts & Holland highlights a recent California federal court ruling that underscores the IRS' harsh treatment of taxpayers receiving poor advice on foreign gift taxes. The case involves Jiaxing Huang, who received substantial gifts from her nonresident alien parents but was penalized for failing to report them. Despite the IRS's new policy of not automatically assessing penalties, Huang's situation illustrates the challenges faced by taxpayers unfamiliar with complex tax rules. The court's decision to allow Huang's lawsuit for a refund of the penalty emphasizes the need for fairness in the tax system. As Miller notes, “Do the right thing and you'll be sorry you did,” reflecting the punitive nature of current IRS practices. The case is Huang v. United States, 2025 BL 183680, N.D. Cal., 24-cv-06298-RS, 5/28/25.

 

Bloomberg Tax

President Donald Trump is expected to sign an executive order in the coming days designed to help make private-market investments more available to U.S. retirement plans, the Wall Street Journal reports, citing people familiar with the matter. The order would instruct the U.S. Labor Department and the SEC to provide guidance to employers and plan administrators on including investments like private assets in 401(k) plans, according to the report, which notes that it could help pave the way for big managers of private assets such as Apollo Global Management and Blackstone to access the vast sums of retirement savings held by workers who don’t have a traditional pension.

 

Wall Street Journal

According to a survey published today by Mercer, over half of large U.S. employers are planning to reduce health care benefits in 2026 due to escalating costs associated with weight-loss and specialty drugs. Specifically, 51% of employers with 500 or more workers intend to increase cost-sharing measures, a rise from 45% in 2025. Alysha Fluno, a pharmacy innovation leader at Mercer, noted: "More clients are saying . . . 'I don't know how much longer we can sustain covering these medications'." The survey highlights that 77% of employers view GLP-1 weight-loss drugs, like Novo Nordisk's Wegovy, as a significant concern. With prescription drug costs having surged by 8% last year, employers are exploring alternatives to traditional pharmacy benefit managers, with 34% considering a switch to new models that promise greater transparency and cost efficiency.

 

U.S. News

The One Big Beautiful Bill Act has opened new avenues for tax savings on real estate investments, enhancing existing opportunities. Rich Arzaga, founder of The Real Estate Whisperer Financial Planning, says: "The opportunity zone benefits really phased out, so if this didn't pass, the opportunity zones would almost completely go away." The law extends opportunity zone tax credits, allowing investors to defer or reduce capital gains. Rachel Richards, head of tax products at Gelt, emphasized that syndicates can provide tax advantages without requiring majority ownership. The new law will also tighten criteria for opportunity zones every 10 years starting in 2027, potentially impacting investments. Mr. Arzaga notes that a focused investment policy statement can help investors navigate the 1031 exchange process effectively. Overall, the law encourages a shift towards cash flow strategies rather than mere appreciation, with Richards highlighting that "cash flow-positive business use can give you that guaranteed return on your investment."

 

Accounting Today

Bruna Szego, chair of the EU Anti-Money Laundering Authority, Europe’s new anti-money laundering watchdog, has said the crypto market is “significantly exposed to money laundering and terrorism financing risks.”

 

Financial Times

The UAE has imposed financial penalties totaling Dh325,000 on several licensed financial institutions for failing to adhere to international tax transparency regulations, including the Foreign Account Tax Compliance Act (FATCA) and the Common Reporting Standard (CRS). This regulatory action, part of the Securities and Commodities Authority's (SCA) efforts in 2025, aims to enhance transparency and support global tax cooperation. The SCA said: "All regulated financial firms must review and enhance their internal compliance mechanisms." The authority says it is committed to maintaining the integrity of the UAE's financial markets and aligning them with global best practices in cross-border tax compliance and financial reporting.

 

Khaleej Times Online

A proposed high-speed rail line, the 'Transcontinental Chief', aims to connect Los Angeles to New York City in under 72 hours, potentially launching by May 10, 2026, just before the FIFA World Cup and America's 250th anniversary. AmeriStarRail, a Delaware-based transportation company, has submitted its plan to Amtrak. It would use existing routes and infrastructure, avoiding the need for extensive new construction. COO Scott Spencer said: "The Transcontinental Chief will be a great opportunity for Amtrak to team up with the private sector." The service is designed to carry both passengers and vehicles, blending elements of European transport systems with U.S. rail operations. However, the project requires cooperation from Amtrak and agreements with host railroads, and operational challenges remain.

 

Daily Mail