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M&A roundup: Forvis Mazars, Blue, LGA and RBSK expand

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Forvis Mazars is expanding in Florida through the acquisition of MSL, P.A., effective Nov. 1.

The deal will add new offices in Orlando, Fort Lauderdale and Tallahassee to the firm.

Financial terms of the deal were not disclosed. Forvis Mazars had annual revenues of approximately $2.2 billion in the U.S. in fiscal year 2024, ending May 31. Revenues for MSL were not disclosed. Forvis Mazars has more than 7,000 team members and over 600 partners in the U.S. Globally it has a combined $5 billion in revenue, 40,000 employees and nearly 1,800 partners in 103 different countries. MSL has approximately 120 team members, including 14 partners.

“MSL has an incredible reputation in Florida, and we are excited about the opportunities to leverage each other’s strengths to serve clients here in new and dynamic ways,” said Paul Thompson, Florida managing partner for Forvis Mazars, in a statement Friday. “This is a great cultural fit as well, which was important as we considered how this could benefit our people and clients.”

MSL dates back about 50 years and offers audit, tax, and consulting services along with an audit practice for clients in the healthcare, public sector, construction, real estate, commercial products and nonprofit sectors. 

“This move greatly enhances the resources and services we can provide to clients and opens up extraordinary new opportunities for our team members,” said MSL president Kevin Murphy in a statement. “Clients will have access to a deeper bench of professionals and specialists—in Florida, across the country, and around the world thanks to the Forvis Mazars global network. Our people will see rewarding career options serving new industries, and they will be able to tap into Forvis Mazars’ award-winning training and professional development programs.”

Forvis was formed about two years ago through the merger of two Top 20 Firms, BKD CPAs & Advisors and Dixon Hughes Goodman, which combined under the name “Forvis” in reference to their “forward vision.” It completed its merger with the global accounting network Mazars in June. In September, it completed a smaller acquisition, of ConTech360, a Charlotte, North Carolina-based construction technology firm, which had been previously announced by Forvis prior to the close of its deal with Mazars.

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Accounting

Report calls for fair value accounting on federal loans

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The National Taxpayers Union Foundation issued a report Friday saying that federal credit programs are costing taxpayers tens of billions of dollars more than estimated because the federal government isn’t using fair value accounting for loans.

The report says that In FY 2025, total federal credit assistance is projected to amount to $1.9 trillion in new direct loans and loan guarantees from 129 different federal programs. Much of this comes through mortgage guarantee programs, student loans, as well as commercial loans and consumer loans. 

Using the federal government’s standard accounting method under the Federal Credit Reform Act the subsidy cost estimate amounts to $2.4 billion. However, the conservative advocacy group contends the FCRA accounting method greatly understates the actual costs of federal credit programs by assuming that federal credit activities are as low-risk as government bonds. It said the Treasury rates are low-risk because they’re backed by the government, but federal credit programs depend on people and businesses actually paying back their loans. 

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The U.S. Capitol in Washington, D.C.

Sarah Silbiger/Bloomberg

A more realistic fair-value method that accounts for market risk would incorporate a premium that reflects the additional compensation an investor would require to bear the risk, the report argues. The fair-value method would estimate the true cost of these programs at $65.2 billion, or $62.7 billion more than the FCRA estimate. 

“By adopting fair-value accounting standards, lawmakers can better evaluate the fiscal risks associated with these programs,” NTUF researchers Demian Brady and Nicholas Huff wrote in the report. “This may help ensure taxpayers are not forced to bear as much of a burden from risky ventures funded by federal loans.”

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Accounting

Taxpayer Advocate criticizes IRS move to shorten third-party notice requirements

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National Taxpayer Advocate Erin Collins is objecting to proposed regulations that would enable the Internal Revenue Service to shorten its third-party notice requirements to as little as 10 days, saying they would unfairly erode the taxpayer notice requirements.

In a blog post Thursday, Collins called attention to a notice of proposed rulemaking that would make exceptions to the 45-day notice requirement in the Taxpayer Protection Act of 2019 and the IRS Restructuring and Reform Act of 1998. The 1998 law included provisions giving taxpayers more protections in circumstances when the IRS intends to contact someone other than the taxpayer (a third party such as a tax preparer) to get information that will help the IRS assess or collect taxes. Prior to contacting a third party, the IRS had to provide taxpayers with “reasonable notice” of the contact.

In 2019, the Taxpayer First Act strengthened 1998 law’s taxpayer third-party contact protections, substituting the “reasonable notice” requirement for a 45-day notice requirement before contacting a third party. Collins noted there are three statutory exceptions to this 45-day notice requirement:

  • When the taxpayer authorizes the contact;
  • If the IRS determines for good cause a notice would jeopardize tax collection or may involve reprisal against any person; or,
  • If the contact is made with respect to any pending criminal investigation.

However, the proposed regulations that the IRS posted this spring would implement exceptions to the 45-day notice requirement, allowing the IRS to shorten the statutory 45-day notification period to 10 days when there’s a year or less remaining on the statute of limitations for collection and certain other circumstances exist. That includes when the case involves an issue where the IRS would have the burden of proof in a court proceeding, and the IRS has requested but the taxpayer has refused to extend the statute of limitations by agreement. Or, the 45-day notice requirement could be reduced to 10 days if there’s a year or less remaining on the statute of limitations and the IRS intends to ask the Justice Department file suit to reduce assessments to a judgment or to foreclose a federal tax lien.
Those exceptions could unfairly punish taxpayers for the IRS’s own delays, according to Collins. 

“The IRS typically has three years to assess additional tax and ten years to collect unpaid tax,” she wrote. “The Taxpayer Bill of Rights includes the taxpayer’s right to finality — meaning, the right to know the maximum amount of time the IRS has to audit a particular tax year or to collect a tax debt. The statute of limitations is an important component of the right to finality because it sets forth clear and certain boundaries for the IRS to act to assess or collect taxes.”

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National Taxpayer Advocate Erin Collins speaking at the AICPA & CIMA National Tax and Sophisticated Tax Conference in Washington, D.C.

She believes the IRS could find itself trying to assess or collect taxes within one year of the statute of limitations for a number of reasons that have nothing to do with the actions or events controllable by the taxpayer. Collins called on the IRS to reconsider the proposed regulations and said Congress should consider enacting additional taxpayer protections for third-party contacts.

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Accounting

PCAOB settles sanction, revokes Chinese firm’s registration

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The Public Company Accounting Oversight Board today settled a disciplinary order sanctioning  a Chinese firm for repeatedly violating PCAOB rules and failing to cooperate with the board’s investigation. 

The PCAOB found that JTC Fair Song CPA Firm, located in Shenzhen, China, repeatedly failed to make required filings. First, the firm repeatedly failed to timely report the participants in its issuer audits on PCAOB Form AP, violating PCAOB Rule 3211, Auditor Reporting of Certain Audit Participants. Second, the firm failed to timely file its annual reports on PCAOB Form 2 in 2021, 2022 and 2023, violating Rule 2201, Time for Filing of Annual Report. 

The firm also failed to cooperate with the PCAOB’s Division of Enforcement and Investigations by refusing to produce documents and information.

PCAOB logo

“All registered firms must comply with PCAOB reporting requirements, which are designed to provide the PCAOB, investors and other stakeholders with important information,” PCAOB chair Erica Williams said in a statement. “When firms don’t comply, the PCAOB will use the tools at our disposal to hold them accountable to fulfill our investor-protector mission.”

Without admitting or denying the findings, JTC Fair Song CPA Firm settled with the PCAOB and consented to a disciplinary order censuring the firm and revoking the firm’s registration. The board accepted the firm’s settlement offer, which does not require it to pay a civil money penalty. The PCAOB would have imposed a $50,000 penalty if it had not taken the firm’s financial resources into consideration.

“Today’s order should serve as a stark reminder that firms must cooperate with the Board’s investigatory process,” Robert Rice, director of the PCAOB’s Division of Enforcement and Investigations, said in a statement. “Cooperation with the Board’s processes is a bedrock principle under our rules and standards and is not optional.”

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