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Nearly ten years after the introduction of its lease accounting standards, the FASB is concluding a formal review of the lessons learned. The review revealed that the costs of compliance were “significantly higher” than anticipated, with an average implementation cost of about $450,000 per company. Board member Christine Botosan emphasized the importance of considering ongoing costs, stating: “Implementation cost is a one-time thing, ongoing costs are forever.” Despite the challenges, Board Member Joyce Joseph noted benefits for investors, including improved comparability and transparency. The review also highlighted how the new rules have influenced business decisions, leading companies to adjust lease terms and payment structures. The FASB aims to apply these insights to future standards and transition processes.

 

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Banks are preparing a $38bn debt package—split between Texas ($23.25bn) and Wisconsin ($14.75bn)—to fund Oracle-linked AI data centers powering OpenAI. JPMorgan, MUFG, Wells Fargo, and others are leading the deal, which would be the largest AI infrastructure financing to date. Developed by Vantage Data Centers, the projects support Oracle’s $500bn Stargate AI investment plan. Loans will mature in four years, with two one-year extensions, and are priced about 2.5% above benchmark. Structured like real estate deals, they’ll be interest-only during construction, then amortize post-launch.

 

Bloomberg

Amazon is reportedly planning to replace over 500,000 U.S. workers with “cobots” by 2027, potentially avoiding the hiring of 160,000 human employees. Internal documents suggest that while Amazon aims to double its product offerings by 2033, robotic automation could ultimately save the company from hiring 600,000 workers. Currently employing around 1.2m U.S. workers, Amazon plans to add 250,000 more for the holiday season. However, the future of these hires is uncertain as the robotics team aims to automate 75% of operations. Udit Madan, vice president of worldwide operations, stated that automation could lead to new, higher-paying jobs, emphasising the importance of upskilling the workforce. Despite concerns, an Amazon spokesman claimed that leaked documents do not represent the overall hiring strategy, asserting: “No company has created more jobs in America over the past decade than Amazon.”

 

The Columbian

New York Times

The number of Americans filing new applications for jobless benefits increased last week, according to economist estimates made in the absence of Labor Department data. In the seven days to October 18th, initial claims for state unemployment benefits rose to a seasonally adjusted 232,000, from 220,000 the prior week, economists at Citigroup and Nationwide calculated. Goldman Sachs estimated claims at 227,000 while JPMorgan put the number at 229,000. States continue to collect the claims figures, submitting them to the Labor Department despite a shutdown of the U.S. government that has caused an economic data blackout. Economists have taken the unadjusted data to make estimates using seasonal adjustment factors the government published earlier this year, providing some view of the labor market.

 

Bloomberg

Reuters

In September, U.S. home sales saw a 1.5% increase from August, reaching an annual rate of 4.06m units, according to the National Association of Realtors, marking the fastest sales pace since February and a 4.1% rise compared to the previous year. Home sales jumped 4.1% on a year-over-year basis. The national median sales price also rose by 2.1% to $415,200, continuing a 27-month streak of annual price increases. The housing market has struggled since 2022 due to rising mortgage rates, which began to decline in July. The average rate for a 30-year mortgage fell to as low as 6.27% last week, encouraging buyers. Sales increased in the Northeast, South and West regions, but declined in the Midwest. Home sales jumped 4.1% on a year-over-year basis. The inventory of existing homes rose 14% to 1.55m, representing a 4.6 month supply at the current sales pace. 

 

The Baltimore Sun

Bloomberg

Reuters

Wall Street Journal

In a piece for The CPA Journal Megan Grady and Jon Durrant of California State University Fullerton examine the declining number of accounting graduates and its uneven impact across various fields within the profession. While the overall number of accounting jobs has increased by nearly 10% since 2020, the decline in graduates is particularly affecting public accounting, especially in tax and non-audit roles. AICPA's 2023 Trends Report highlights a 7.8% decrease in bachelor's degrees and a 6.4% decrease in master's degrees in accounting from 2021 to 2022. Ms. Grady emphasizes the need for further research to understand the factors driving students away from accounting careers, stating: "The importance of this topic has never been greater." The article suggests that addressing the disparity in job attractiveness between tax and audit roles is crucial for reversing the trend.

 

The CPA Journal

Target is set to eliminate approximately 1,800 corporate positions to enhance decision-making and rejuvenate its customer base. Chief operating officer Michael Fiddelke, who will become chief executive on February 1st, commented: "The truth is, the complexity we've created over time has been holding us back. Too many layers and overlapping work have slowed decisions, making it harder to bring ideas to life." The layoffs, affecting about 8% of the corporate workforce, will primarily impact employees at the Minneapolis headquarters. Around 1,000 employees will receive layoff notices next week, while 800 vacant positions will also be cut. Despite these changes, store employees and supply chain workers will not be affected. Target has faced declining sales, reporting a 1.9% drop in comparable sales in the second quarter, alongside a 21% decrease in net income. The company aims to reclaim its retail leadership by improving merchandise selection and customer experience.

 

ABC News

New York Times

Reuters

Minnesota Star Tribune

Ford has warned of a profit hit of up to $2bn from a fire at an aluminum supplier’s plant in New York, prompting a downgrade in its annual guidance. Adjusted third-quarter earnings were 45 cents per share, beating the 36-cent average of analyst estimates compiled by Bloomberg. Sales came in at a record $50.5bn, ahead of the estimated $43.7bn. Ford now expects an adjusted operating profit of $6bn-$6.5bn for the full year, compared with its earlier target range of $6.5bn-$7.5bn. “The quarter was better than expected, and the outlook was better than feared,” Piper Sandler analyst Alexander Potter said in a note.

 

Bloomberg

Financial Times

The IRS has announced that many of its services will be limited or unavailable due to the ongoing government shutdown, which has now lasted over three weeks. Tax refunds will generally not be issued, except for electronically filed, error-free Form 1040 returns that can be processed automatically. The IRS urges taxpayers to file electronically with direct deposit to minimize delays. While live customer service assistance will be limited, automated services will remain operational. Additionally, all Taxpayer Assistance Centers will be closed, and appointments related to the Independent Office of Appeals or Taxpayer Advocate Service will be canceled. Despite the shutdown, the IRS is preparing for the upcoming tax season, stating: "The IRS will continue some critical operations during this period."

 

Accounting Today

As the government shutdown extends into its fourth week, the SEC has halted the approval of IPOs, causing significant delays for companies eager to go public. Unilever recently postponed the spinoff of its Magnum Ice Cream Co. unit due to this freeze. The IPO market had previously seen a surge, raising over $30bn in September alone. Stacie Aarestad, a partner at Foley Hoag, remarked: “It’s difficult for the company and underwriters to get comfortable with the disclosure because you haven’t had that process come to a conclusion.” The SEC has introduced new guidance allowing companies to file with limited pricing information, but uncertainty looms as the shutdown continues, potentially impacting Chairman Paul Atkins' goal to “make IPOs great again.”

 

Bloomberg Tax

Bloomberg Tax

President Trump has granted a pardon to Changpeng Zhao, the billionaire founder of the cryptocurrency exchange Binance, wiping away one of the U.S. government’s most significant crackdowns on crypto crime. Zhao, a billionaire known as "CZ" who is one of the most influential figures in crypto, quit in 2023 as Binance chief after the company pleaded guilty to failing to maintain an effective anti-money laundering program and paid a penalty of $4.3bn. In a post on social media platform X, Zhao said he was "deeply grateful for today’s pardon and to President Trump for upholding America’s commitment to fairness, innovation, and justice." He added: "Will do everything we can to help make America the Capital of Crypto."

 

New York Times

Reuters

Washington Post

President Trump has abruptly ended U.S.-Canada trade negotiations, citing a Canadian ad using Ronald Reagan’s voice to criticize tariffs. Trump labeled the ad “FAKE” and claimed it interferes with ongoing court decisions on tariffs. Sponsored by Ontario’s government, the $53m campaign uses Mr. Reagan’s 1987 radio address to highlight the harms of protectionism. The Reagan Foundation said it wasn’t asked for permission and is reviewing legal options. The announcement intensifies an already tense trade relationship, which includes Mr. Trump’s 50% tariffs on Canadian steel and aluminum and pending reviews of the U.S.-Mexico-Canada Agreement.

 

Bloomberg

Reuters

Wall Street Journal

Canada's retail sales rebounded in August as consumers spent more on new cars, at supermarkets and for clothing, according to Statistics Canada. Revenues rose 1% to C$70.4bn ($50.2bn), from an upwardly-revised drop of 0.7% in July. An advance estimate for September showed that sales are likely to fall by 0.7%.

 

Financial Post

CTV News

Reuters

The Globe and Mail