| A.
R. Kakhsaz Company
an accountancy corporation
Member
American Institute of
Certified Public Accountants
International associates:
Tavana & Co.
Chartered Accountants
Toronto, Canada
Tel.416-229-2221
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GIVING CORPORATE AMERICA
A HARD TIME: A tribe of 5,000 from the high rain forests of Colombia vowed to walk off a 1,400-foot cliff in the
Andes Mountains if Occidental Petroleum Corp drills for oil on their land. At Occidental's annual
shareholders' meeting in Los Angeles in April 1999, after lecturing Ray
Irani, Occidental's chairman and CEO on "before there was history, before there was the sun and the moon," and 45
minutes of pleas to cancel the project and avert tribal suicide, Mr. Irani
responded: "The fact of the matter is your problems should be discussed with
the Colombian government, not here. .. It doesn't matter what Occidental does or doesn't do."
Finally and after much haggling, a proposal to force Occidental to hire an outside firm to analyze
the potential impact of the tribal suicide threat on the company's stock price won approval of the
shareholders.
THE WAGE DIFFERENCE
BETWEEN CHILDLESS
men and women ages 27 to 33 is less than 2%.
U.S. PRODUCTIVITY KEEPS ON
GROWING: First quarter '99 business-productivity which measures nonfarm output per hour worked, rose
at an annual rate of 3.5% from the fourth quarter '98. The faster productivity rises, the more
employers can afford to raise wages without raising prices or squeezing profits. Over the past
five years, productivity growth has averaged about 2% a year, up from the 1% average annual rate
during the 20 years ending in 1993. Manufacturing productivity rose 6.2% in the first quarter '99, up
from a 5.3% rise in the fourth quarter '98. Meanwhile, some believe that inflationary
pressures are building up, because the unit labor costs which is the amount of wages paid for each
item produced, also rose by 0.7% from the expected growth rate of 0.3% for the first quarter.
FEDERAL RESERVE CHAIRMAN
Alan Greenspan warned that the gains to businesses and consumers from computerization could soon hit
their limit. "The rate of growth of productivity cannot increase indefinitely," said
Greenspan. He also noted that technology has played a key role in restraining inflation in the U.S. The heavy
spending on computers in the 1990s by every sector - from car makers to farmers - has cut
production costs, making it less necessary for sellers to raise prices.
CATCHING UP WITH E-CABULARY
WHICH IS really the vocabulary of today: For instance, "e-tailors" is now referred to electronic retailers or
retailers who do business via e-commerce.
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- FASTER PACE OF CHANGING
JOBS: The average number of years employees stay at their jobs decreased to 3.6 years in 1998 from 3.8
years in 1996.
CHARITABLE SPLIT-DOLLAR
LIFE INSURANCE plans are not philanthropy but tax avoidance schemes and will be dealt with as such,
announced the IRS. Such transactions "will not produce the tax benefits advertised by their
promoters." The IRS warns participants, promoters, advertisers and preparers of "adverse
consequences, including penalties." The taxpayers will be subject to a 20% underpayment
penalty on top of the income-tax and interest on the illegitimate deduction amounts, while
cooperating nonprofit organizations risk loosing their tax-exempt status for their involvement.
INTERNET USERS SPENT SOME
$5 BILLION online last year.
DID YOU DONATE A
BROKEN-DOWN OLD CAR TO a charity for a nice income-tax deduction? The
IRS says it has been aware of abuses in this area for a few years and now plans a crack-down.
"Both charities and donors are likely to be affected." Some state attorneys general also are
upset. An advertisement, asking for gifts of such cars says: Your used car "doesn't even have to
run or have a motor! Just four tires on it so it can be towed if necessary and get [a tax-deduction for
the] full Blue Book value."
FAVORING ELIMINATION OF
ESTATE AND GIFT taxes, Senator Connie Mack says: "Death and
taxes both may be inevitable, but they should not be simultaneous."
THE PRESIDENTIAL
MILLENNIUM PARTY: In an executive order, issued last year, for the
creation of the While House Millennium Council, President Clinton explains that the government's
millennial role goes beyond worrying about the Y2K computer bug. "The Federal Government has
an unprecedented opportunity to energize and unite the Nation with a renewed sense of
optimism in the accomplishments and promise of America," declares the President. A massive
Year-2000 celebration at the Washington DC Mall is being contemplated.
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WE SEE
MORE IN NUMBERS than just numbers… We see opportunities for you.
WE SEE
MORE IN NUMBERS than just numbers… We see opportunities for you.
Ali R. Kakhsaz, CPA, MAcc
www.arkpca.com
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