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Supreme Court appears skeptical of Trump’s global tariffs

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10 months ago

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The U.S. Supreme Court appeared skeptical of President Donald Trump’s sweeping global tariffs, as key justices suggested he had overstepped his authority with his signature economic policy.

In a nearly three-hour hearing Wednesday, the court hinted it was ready to put significant limits on Trump’s far-reaching agenda for the first time since he took office in January. Three members of the conservative majority questioned Trump’s use of an emergency-powers law to collect tens of billions of dollars in tariffs a month.

Chief Justice John Roberts said the tariffs were an “imposition of taxes on Americans and that has always been the core power of Congress.” Justice Neil Gorsuch also signaled he was a probable vote against the president, and fellow Trump appointee Amy Coney Barrett asked probing questions of both sides.

A decision against Trump could force more than $100 billion in refunds, remove a major burden on the U.S. importers that are paying the tariffs, and blunt an all-purpose cudgel the president has wielded against trading partners. More broadly, it would be by far the Supreme Court’s most significant pushback against Trump’s assertions of powers that go well beyond those claimed by his White House predecessors.

The court’s three liberal justices — Justices Elena Kagan, Sonia Sotomayor and Ketanji Brown Jackson — also expressed doubt about the legality of the tariffs. A ruling could come as quickly as the end of the year, given the ultra-expedited schedule the Supreme Court has set so far.

“I came to oral argument thinking the administration had a pretty uphill climb, and I left feeling the same way,” said Adam White, a scholar who focuses on the Supreme Court and constitutional law at the American Enterprise Institute. “The far and away most likely outcome is that the administration loses this case.”

That would be a shift at a conservative-controlled court that has repeatedly backed Trump this year through temporary orders letting him implement new policies while legal fights go forward. The tariff case marks the first time the court directly considered Trump’s underlying assertions of sweeping presidential power.

The atmosphere Wednesday was unusually relaxed for a court that is often sharply divided, with laughter punctuating the arguments several times. At one point, Kagan playfully needled Roberts after he seemed to confuse her and Sotomayor, who had just finished asking a round of questions.

“No, she’s Justice Sotomayor. She just finished,” Kagan quipped.

The case involves Trump’s April 2 “Liberation Day” tariffs, which impose taxes of 10-50% on most U.S. imports depending on the originating country. Trump says those duties are warranted to address the longstanding national trade deficit. The high court clash also covers separate tariffs Trump said he imposed on Canada, Mexico and China to address fentanyl trafficking.

Authority questioned

Trump says his tariffs are authorized under the 1977 International Emergency Economic Powers Act, a law that gives the president a panoply of tools to address national security, foreign policy and economic emergencies. IEEPA, as the law is known, doesn’t mention tariffs as one of those powers, though a key provision says the president can “regulate” the “importation” of property to deal with a crisis.

Gorsuch indicated alarm at the reach of the Trump administration’s contention that Congress had delegated its constitutional authority over tariffs to the president.

Under the government’s logic, “what would prohibit Congress from just abdicating all responsibility to regulate foreign commerce – for that matter, declare war – to the president?” Gorsuch asked U..S Solicitor General D. John Sauer, the government’s top Supreme Court lawyer.

Gorsuch later asked whether a president could impose a 50% tariff on gas-fueled cars and auto parts to tackle climate change. Sauer responded that the president could.

Barrett questioned whether the statute’s words were enough to let the president put in place tariffs.

“Can you point to any other place in the code or any other time in history where that phrase together ‘regulate importation’ has been used to confer tariff-imposing authority?” Barrett asked Sauer.  

But Barrett also joined Justice Brett Kavanaugh in questioning whether the arguments of the tariff challengers made sense, given that IEEPA authorizes the president to shut down trade entirely with a foreign country. Both asked why Congress might preclude the president from taking the more limited step of imposing tariffs.

“That just seems a bit unusual,” Kavanaugh said.

In a possible sign of the case’s likely outcome, Barrett asked how refunds would work should the tariffs be invalidated. “It seems to me like it could be a mess,” the justice said. 

The companies’ lawyer, Neal Katyal, acknowledged refunds would be “very complicated,” but argued that the Supreme Court previously had held that “serious economic dislocation isn’t a reason to do something.” He also said the court could invalidate the tariffs only on a “prospective” basis, though none of the justices indicated any interest in that possibility.

Sauer, the administration lawyer, told the justices that Trump “determined that our exploding trade deficits had brought us to the brink of economic national security catastrophe.”

The high court is considering two separate lawsuits filed by small businesses along with a third case pressed by 12 Democratic state attorneys general. All three lower courts to have ruled on the issue declared the tariffs to be unlawful.

Roberts indicated he saw the case as being governed by the “major questions doctrine,” a legal rule the court used repeatedly to thwart Joe Biden’s agenda when he was president. Under the major questions doctrine, federal agencies need explicit congressional authorization to take actions that have sweeping economic or political significance.

“The justification is being used for a power to impose tariffs on any product from any country in any amount for any length of time,” he said. “It does seem like that’s major authority.”

A number of legal experts said the court seemed likely to put limits on Trump’s tariff power.

“Some conservative justices had tough questions for both sides, making it hard to say with certainty where they’ll land,” said Liza Goitein, an expert on emergency powers at the Brennan Center for Justice at NYU Law, on social media. “But given the degree of pushback on key administration arguments, it’s looking quite possible — if not likely — the tariffs will be struck down.”

Treasury Secretary Scott Bessent said Sauer “presented strong, persuasive arguments on the necessity of using IEEPA tariff authority to confront the emergencies President Trump has declared.”

The tariff arguments were a hot ticket in Washington. Among those in attendance from the administration were Bessent, Commerce Secretary Howard Lutnick and U.S. Trade Representative Jamieson Greer. Members of Congress included Democratic Senators Amy Klobuchar and Ed Markey and Republican Representative Jason Smith. John Mulaney, the comedian, was also at the arguments.

Should Trump lose, administration officials say most of the levies could be imposed using other, more complicated legal tools. Trump’s tariffs on steel, aluminum and automobiles were put in place under a different law, so are not directly affected.

The cases are Trump v. V.O.S. Selections, 25-250, and Learning Resources v. Trump, 24-128.

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Accounting

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

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1 week ago

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August 25, 2026

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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.

 

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Accounting

AI-Driven Automation and Continuous Accounting Frameworks

Published

3 weeks ago

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August 15, 2026

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The accounting profession is undergoing a fundamental structural transition as enterprise finance departments shift from periodic month-end closes toward automated continuous accounting models. By integrating specialized machine learning algorithms directly into enterprise resource planning (ERP) platforms, chief accounting officers are transforming financial reporting from a retrospective exercise into a real-time operational asset.

The Shift from Periodic Close to Continuous Financial Reporting
Traditional accounting workflows heavily relied on manual data reconciliation, spreadsheet calculations, and multi-week closing cycles at the end of each fiscal period. In contrast, continuous accounting frameworks utilize automated software agents to process, validate, and post transactional data in real time as business activities occur.

Automated bank reconciliation tools cross-reference incoming bank feeds, invoice records, and purchase orders automatically. By resolving transactional variances instantly throughout the month, corporate accounting teams eliminate the traditional workload spikes associated with quarterly and annual closes.

Machine Learning in Audit Trails and Anomaly Detection
Advanced natural language processing (NLP) and machine learning tools are redefining internal audit and financial control environments. Automated systems analyze 100% of general ledger entries, identifying anomalous transactions, duplicate payments, and unauthorized journal entries in real time.

Rather than relying on random statistical sampling, corporate internal auditors can focus their attention on high-risk flags automatically surfaced by algorithmic monitoring platforms. This continuous risk assessment strengthens internal controls over financial reporting (ICFR) and significantly reduces fraud risk.

Evolving Roles for Accounting Professionals
As routine data entry and manual reconciliation tasks become fully automated, the skill set required for accounting professionals is shifting toward data analysis, system design, and strategic business advisory.
– Systems Governance: Accountants are increasingly responsible for monitoring algorithmic accuracy and managing data integration pipelines.
– Business Partnership: Finance professionals leverage real-time financial dashboards to advise operational leaders on margin management and working capital allocation.
– Regulatory Compliance Management: Accounting teams utilize automated platforms to ensure compliance with dynamic tax codes and international accounting standards.

Core Implementation Recommendations
1. Deploy Automated Reconciliation Tools: Integrate continuous transaction processing modules into existing enterprise ERP architectures.
2. Establish Algorithmic Governance Controls: Implement strict internal testing protocols to ensure automated accounting rules comply with GAAP/IFRS standards.
3. Reskill Accounting Teams: Invest in training finance staff on data analytics, workflow automation, and predictive financial modeling.

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Accounting

Global ESG Reporting Standards and Double Materiality Compliance

Published

4 weeks ago

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August 9, 2026

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Corporate accounting departments face expanding reporting expectations as international sustainability disclosure standards achieve regulatory enforcement across major global jurisdictions. Chief Accounting Officers (CAOs) and corporate controllers are establishing rigorous internal accounting controls to treat Environmental, Social, and Governance (ESG) metrics with the same data precision, auditability, and governance as traditional financial statements.

Regulatory Harmonization Under Global Sustainability Frameworks
The implementation of standardized sustainability reporting frameworks—notably rules established by international sustainability accounting boards—has created unified expectations for public and large private enterprises. Corporations must report standardized metrics covering greenhouse gas emissions (Scope 1, 2, and material Scope 3), energy utilization, workforce demographics, and supply chain governance.

In Europe and other participating international jurisdictions, double materiality principles are mandatory. Under double materiality, organizations must report both how external sustainability risks impact corporate financial performance, and how internal corporate operations affect surrounding environmental and social structures.

Integrating Sustainability Metrics into Core ERP Systems
To provide auditable non-financial data, enterprise organizations are integrating specialized carbon accounting and ESG management platforms directly into core ERP systems. Automated data collectors capture energy utility invoices, logistics fuel consumption metrics, and vendor compliance records in real time.

Establishing automated, traceable data pipelines ensures that non-financial reporting is supported by clear audit trails. This structured approach allows external financial auditors to provide reasonable assurance on sustainability disclosures during annual corporate reporting cycles.

Financial Impacts and Capital Market Disclosure
Accurate ESG reporting directly influences corporate cost of capital and institutional credit ratings. Commercial lenders and institutional asset managers systematically incorporate sustainability metrics into risk pricing models. Companies that demonstrate transparent, verifiable progress in operational energy efficiency and climate risk mitigation benefit from expanded access to green bond markets and lower debt pricing.

Action Steps for Accounting Leadership
1. Implement Double Materiality Frameworks: Conduct comprehensive assessments to identify material financial and operational sustainability metrics.
2. Build Auditable Non-Financial Data Pipelines: Automate ESG data collection within core accounting software to ensure data integrity.
3. Align Sustainability with Annual Financial Filings: Prepare non-financial disclosures concurrently with financial statements to satisfy regulatory audit expectations.

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