Connect with us

Accounting

Administration calls for less AI regulation, tax-free AI training

Published

1 year ago

on

The White House has released what it calls America’s AI Action Plan, which calls for a wide variety of measures involving AI, such as cutting regulations, promoting standards, developing the market and aligning models with certain values.

Regulation, deregulation and standards

Among many other things, the plan calls for the Department of Commerce, in cooperation with the National Institute of Standards and Technology, to convene a broad range of public, private and academic stakeholders to accelerate the development and adoption of national standards for AI systems and to measure how much AI increases productivity at realistic tasks in those domains. The administration believes this will encourage AI adoption. 

“Many of America’s most critical sectors, such as healthcare, are especially slow to adopt due to a variety of factors, including distrust or lack of understanding of the technology, a complex regulatory landscape, and a lack of clear governance and risk mitigation standards. A coordinated federal effort would be beneficial in establishing a dynamic, ‘try-first’ culture for AI across American industry,” said the document. 

The plan also calls for guidelines and resources for federal agencies to conduct their own evaluations of AI systems for their distinct missions and operations and for compliance with existing law, as well as supporting the development of the science of measuring and evaluating AI models. Further, it would promote the development of the science of measuring and evaluating AI models in an effort led by NIST at DOC, the Department of Education, the National Science Foundation, and other federal science agencies. 

At the same time, the administration also believes regulations need to be rolled back. The plan recommends working with federal agencies to identify, revise or repeal regulations, rules, memoranda, administrative orders, guidance documents, policy statements and interagency agreements that are felt to be unnecessarily hindering AI development or deployment, as well as soliciting feedback from businesses and the public at large about current regulations that hinder AI innovation and adoption, and work with relevant federal agencies to take appropriate action. 

Meanwhile, in order to encourage the building of data centers, the plan would weaken certain environmental regulations, like the Clean Water Act, expedite environmental permitting, and make federal lands available for construction.

It also recommended a review of all Federal Trade Commission investigations commenced under the previous administration to ensure they do not advance theories of liability that unduly burden AI innovation.

AI regulation in the future could come from the establishment of regulatory sandboxes or AI Centers of Excellence where researchers, startups and established enterprises can rapidly deploy and test AI tools while committing to open sharing of data and results. These efforts would be enabled by regulatory agencies such as the Food and Drug Administration and the Securities and Exchange Commission, with support from the Commerce Department through its AI evaluation initiatives at NIST.

The plan also seems concerned about ensuring models conform with certain values. Specifically, the administration wants to revise the NIST AI Risk Management Framework to eliminate references to misinformation, diversity, equity and inclusion, and climate change. Further underscoring the point, it also wants to update federal procurement guidelines to ensure that the government only contracts with frontier large language model developers who ensure their systems are perceived by the administration as objective and free from top-down ideological bias.

Training and labor

The plan also contains a number of labor and training-related measures in recognition of widespread anxiety about mass job loss in the wake of AI. 

Under the plan, the Treasury Department would release guidance clarifying that many AI literacy and AI skill development programs may qualify as eligible educational assistance under Section 132 of the Internal Revenue Code, given AI’s widespread impact reshaping the tasks and skills required across industries and occupations. In certain situations, this will enable employers to offer tax-free reimbursement for AI-related training and help scale private-sector investment in AI skill development. 

Meanwhile, the Department of Labor would leverage its available discretionary funding for the rapid retraining for individuals impacted by AI-related job displacement. Paired with this would be clarifying guidance to help states identify eligible dislocated workers in sectors undergoing significant structural change tied to AI adoption, as well as guidance clarifying how state Rapid Response funds can be used to proactively upskill workers at risk of future displacement. 

The plan would also support the creation of industry-driven training programs that address workforce needs tied to priority AI infrastructure occupations as well as expand early career exposure programs and pre-apprenticeships that engage middle and high school students in priority AI infrastructure occupations.

Market development

The plan also suggests measures to grow and mature the financial market for the kind of large-scale computing power generally needed by startups and academic institutions developing AI technologies. Right now such arrangements often involve long-term contracts, which are beyond the budgetary reach of most. The administration would like to increase access in a similar manner as other financial offerings. 

“America has solved this problem before with other goods through financial markets, such as spot and forward markets for commodities. Through collaboration with industry, NIST at DOC, OSTP, and the National Science Foundation’s (NSF) National AI Research Resource (NAIRR) pilot, the Federal government can accelerate the maturation of a healthy financial market for compute,” said the plan. 

The plan also calls for working with tech companies to increase access to private sector computing, models data and software resources for the research community. 

This is part of the larger push to encourage open-source and open-weight models that are freely available by developers for anyone in the world to download and modify. Such models, according to the document, have unique value for innovation as they can be used without being dependent on the model provider. That would also allow those with sensitive data to use AI without sending information to the vendor’s servers. 

“We need to ensure America has leading open models founded on American values. Open source and open-weight models could become global standards in some areas of business and in academic research worldwide. For that reason, they also have geostrategic value. While the decision of whether and how to release an open or closed model is fundamentally up to the developer, the federal government should create a supportive environment for open models,” said the plan. 

Other topics covered include combating deep fakes and other synthetic media, science funding, cybersecurity and trade. Overall, the administration said winning the “AI race” is essential for maintaining U.S. power and influence. 

“Whoever has the largest AI ecosystem will set global AI standards and reap broad economic and military benefits,” said the document. “Just like we won the space race, it is imperative that the United States and its allies win this race.”

Related Topics:
Continue Reading

Accounting

Embedded AI and Automated Anomaly Detection Reshape Modern Corporate Accounting Frameworks

Published

15 hours ago

on

September 13, 2026

By

Embedded AI and Automated Anomaly Detection Reshape Modern Corporate Accounting Frameworks

The accounting and audit landscape in 2026

The accounting and audit landscape in 2026 is defined by the full integration of artificial intelligence directly into core enterprise software platforms. Rather than operating as standalone third-party tools, generative AI, automated reconciliation, and continuous anomaly detection are now natively embedded within major ERP engines including SAP, Oracle, Microsoft Dynamics, QuickBooks, and Sage. This technology integration is transforming daily financial operations, internal reporting controls, and external audit workflows.

Recent industry benchmark surveys reveal a widening performance gap

Recent industry benchmark surveys reveal a widening performance gap between finance teams utilizing integrated AI automation and those relying on legacy manual processes. Organizations actively leveraging embedded AI report up to 37% higher revenue per employee, driven by automated invoice matching, instant ledger entries, and predictive cash flow modeling. Routine, high-volume transactional tasks that once required manual intervention are now executed in real time with continuous digital audit trails.

AI introduces new governance and control responsibilities

However, the widespread deployment of embedded AI introduces new governance and control responsibilities for accounting professionals. Auditing standards now mandate strict verification protocols for algorithmically generated journal entries and financial commentary. External auditors are evaluating enterprise AI governance frameworks, reviewing automated rule sets, testing data ingestion pipelines, and ensuring that financial controllers maintain human-in-the-loop oversight over automated system outputs.

Furthermore, cloud governance and data security have become core operational skills for modern CPAs and controllers. As financial ledgers and client data stream through interconnected cloud ecosystem APIs, accounting teams must implement multi-factor access controls, continuous data encryption, and strict data privacy compliance to protect sensitive financial records from cyber vulnerabilities.

The embedding of AI into enterprise accounting software redefines internal financial controls and career requirements for accounting professionals. Business owners and finance leaders must update governance protocols, invest in staff digital literacy, and ensure accounting systems maintain rigorous audit compliance to capture productivity gains safely.

Continue Reading

Accounting

Mandatory ESG Reporting Standards Demand Standardized Non-Financial Audit Trails

Published

1 week ago

on

September 5, 2026

By

Mandatory ESG Reporting Standards Demand Standardized Non-Financial Audit Trails

Corporate accounting departments face an expanded regulatory mandate as mandatory sustainability and Environmental, Social, and Governance (ESG) reporting frameworks take full effect internationally. Governed by the European Union’s Corporate Sustainability Reporting Directive (CSRD) and the International Sustainability Standards Board (ISSB) IFRS S1 and S2 standards, enterprise financial controllers are now legally required to track, verify, and report non-financial data with the same internal controls and auditability as traditional financial statements.

The expansion shifts ESG compliance

This regulatory expansion shifts ESG compliance from marketing departments to corporate accounting offices. Financial managers are now responsible for gathering, consolidating, and verifying carbon emissions metrics, supply chain labor conditions, water usage, and climate risk exposures across multi-tiered corporate structures. These non-financial metrics must be integrated into standardized general ledgers to withstand rigorous third-party audit assurance processes.

To comply with these rigorous reporting mandates, accounting software providers have added dedicated ESG modules designed to aggregate data from IoT sensors, utility platforms, and vendor management systems. Controllers are implementing internal control frameworks—modeled after traditional COSO frameworks—to ensure the completeness, accuracy, and consistency of sustainability disclosures, protecting organizations against greenwashing penalties and litigation risks.

The transition requires significant cross-functional collaboration between accounting teams, legal counsel, and operational directors. Accounting professionals are expanding their technical expertise beyond financial ledgers to master carbon accounting methodologies, lifecycle assessment standards, and non-financial data governance protocols, fundamentally expanding the role of the modern corporate accountant.

Why This Information Matters
Mandatory ESG disclosures require companies to treat environmental and social metrics as audited financial records. Executives, accountants, and board members must institute formal tracking and assurance processes to satisfy legal mandates, maintain investor confidence, and mitigate regulatory non-compliance risks.

Continue Reading

Accounting

SEC’s Semiannual Reporting Proposal Faces Investor Pushback: What CFOs Need to Know

Published

3 weeks ago

on

August 25, 2026

By

U.S. Securities and Exchange Commission (SEC)

A proposal from the U.S. Securities and Exchange Commission to potentially shift some public companies away from quarterly financial reporting toward a semiannual model is drawing significant pushback from investors, even as it continues moving through the regulatory process. The debate has direct implications for corporate finance teams, auditors, and the broader transparency of U.S. capital markets.

What the SEC Proposed

According to a summary published by accounting advisory firm Cohen & Co., the SEC issued a proposed rule on May 19, 2026, aimed at simplifying financial reporting requirements for many U.S. public companies. The proposal would potentially reduce the frequency of certain mandatory disclosures from quarterly to semiannual, a structural change that has not been made to core U.S. reporting requirements in decades.

The proposal follows an extended debate within U.S. policy circles, with proponents arguing that reduced reporting frequency could lower compliance costs and free up management time for longer-term strategic planning rather than quarter-to-quarter results management.

Why Investors Are Pushing Back

Comment letters submitted in response to the proposal have been extensive, and according to Cohen & Co.’s review of the public record, investors “appear to be largely opposed” to the shift, viewing frequent interim reporting as a core benefit of U.S. capital markets relative to other jurisdictions.

Accounting and law firms have taken a more measured position, generally urging any changes to remain aligned with the Financial Accounting Standards Board (FASB), whose existing disclosure requirements and guidance are built around a quarterly reporting cadence. A shift to semiannual reporting without corresponding changes to FASB guidance could create friction between SEC filing requirements and GAAP-based disclosure expectations.

Lessons From the U.K. Experience

The debate is not without precedent. The United Kingdom moved away from mandatory quarterly reporting for listed companies in 2014, returning to a semiannual disclosure requirement. According to Cohen & Co.’s analysis, that experience offers a cautionary data point: there was no measurable increase in capital expenditure or R&D investment following the change, while analyst coverage of affected companies declined as reliable interim information became less available — a particular risk for smaller and newly public companies that rely on analyst coverage to maintain investor visibility.

Practical Implications for Finance Teams

Beyond the debate over disclosure philosophy, the proposal carries practical complications. Many companies have debt covenants and credit agreements structured around quarterly financial delivery; a shift to semiannual reporting could require renegotiating those terms. Reduced reporting frequency would also extend the “window of market silence” between disclosures, a factor that governance and investor-relations teams would need to manage carefully to avoid information asymmetry.

Separately, and unrelated to the reporting-frequency debate, the SEC and FASB have continued finalizing more routine updates this year. New Accounting Standards Updates are taking effect for December 31, 2026, fiscal year-ends covering income tax disclosures, credit loss measurement, induced debt conversions, and stock compensation, according to Eide Bailly’s review of 2026 ASU activity. Additional guidance on paid-in-kind dividends and environmental credits is also on the near-term horizon.

What to Watch Next

The semiannual reporting proposal remains in the comment and review phase, and no final rule has been adopted as of this writing. Finance leaders should monitor the SEC’s regulatory agenda for further movement, while treating the current quarterly reporting requirement as the operative standard until any final rule is issued and an effective date is set.

Given the extent of investor opposition documented in the comment file, a full shift to mandatory semiannual reporting appears more likely to result in either a scaled-back compromise or continued study rather than swift adoption — though the SEC’s ultimate direction remains uncertain.

 

Continue Reading

Trending