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Flashcards in R-5 Deck (23):
1

What is the hierarchy of determining authority?

IRC code
Revenue rulings
Court cases

2

What is listed transaction?

Transaction specifically identified as tax avoidance

3

What is more likely than not?

There is greater than 50% likelihood of tax position being upheld.

4

How long should tax return copies be maintained?

3 years

5

For how many years does workpapers for audit be maintained?

7 years

6

After how long should the auditors rotate?

5 years

7

What is the form after the tax audit?

Form 870

8

What is reasonable basic standard?

more than 20% chance of succeeding.

9

What is tort by CPA?

Duty of care
Breach of duty
caused injury
Damages.

10

What is fraud?

misrepresentation
Intent
Actual and justifiable reliance
induce reliance
damages

11

What is Section 11 of 1933 act?

Material Misstatement in financial statements
acquired stock
suffered a loss

12

What rule 10b-5?

Material Misstatement in financial statements
acquired stock
suffered a loss

Scienter
Relied on misrepresentation

13

What are securities exemption for 1933 act?

banks and saving loans
not for profit organizations
government
regulated common carriers

14

What is regulation A?

simplified form of registration and may not exceed 5 million in 12 months of sale

15

What is Regulation D?

No advertising
purchasers will hold 2 years or more
SEC must be informed within 15 days

16

What is 504, 505, 506?

See R-5 pg 49

17

What is section 11 cause of action?

acquired stock
suffered a loss
material misrepresentation

18

What is 1934 act registration requirements?

traded on national exchange
10 million in assets or 500 shareholders who are not accredited. or 2000 shareholders

19

What is periodic reports filing timings?

10-K: 60 days for large corps, 90 days small corps
10 Q: 40 days for large corps, 45 days small corps
8-K: major change in the company

20

Who are insiders?

officers, directors and 10% shareholders

21

What are anti-fraud provisions as per 10b-5?

fraud in connection with purchase or sale of security

22

What will interstate laws apply?

10b-5 and Section 11 of 1933 law.

23

What is comparison of 10b-5 and section 11 of 1933 law?

See R-5 page 55