Corporate accountability, tax shelters are key topics of 57th Annual Conference.

• Position: 57th Annual Conference Re-cap

More than 650 TEI members and guests came to celebrate Toronto at TEI's 57th Annual Conference from October 20 to October 23. Held at the Sheraton Centre Toronto in Canada's largest city, the three-day conference continued TEI's tradition of excellence with up-to-the-minute discussions of the effect of the recent Sarbanes-Oxley legislation on tax executives; tax accrual workpapers and penalties; and recent tax accounting developments, as well as a third track of concurrent topics devoted to Canadian and other cross-border tax issues.

Canada's Deputy Finance Minister Kevin Lynch opened the conference on Monday morning with a lively slide presentation on the country's economy. An economist, Mr. Lynch focused on the growth in the Canadian economy vis-a-vis the United States, noting that the country gained 427,000 jobs in 2001. Canada's trade balance remains in surplus, he said, and its foreign debt is the lowest in 50 years.

Referring to the recent legislation to cut tax rates, the Deputy Minister predicted that in 2003 Canadian firms will enjoy a capital rate advantage over those in the United States; this advantage will grow to more than 4 percent by 2005. Mr. Lynch closed his remarks by quoting Thomas L. Friedman: With globalization, "the big don't eat the slow; the fast eat the slow." In public policy, he added, we need to think speed; it wins.

Later that day, Assistant U.S. Treasury Secretary Pamela Olson addressed the Treasury and IRS's recent tax shelter initiatives.

Referring to the proposed tax shelter disclosure regulations, the Assistant Secretary acknowledged that the new rules will impose additional compliance burdens on many taxpayers. "I apologize for that," she stated, adding that the government is trying "to minimize the burden to the maximum extent consistent with transparency and consistency." She pledged to work with TEI to ensure that the rules are the least burdensome they can be without sacrificing their deterrent effect.

Referring to several bills pending in Congress, Ms. Olson said she favored conformity in the definitions of a tax shelter for registration and disclosure purposes. She added that the government seeks to encourage voluntary adoption of that definition for registration purposes under a tax "best practices" approach.

On the audit front, the Assistant Secretary explained that the IRS's Large and Mid-Size Business Division is undergoing a massive change in the way it does business. LMSB must transform itself...