Weinberg & Company

Best Practice Newsletter – December 2023

By December 19, 2023 No Comments

Deadline: Anti-Money Laundering Reporting –

Starting January 1, 2024, many companies will be required to report information to the U.S. government about who ultimately owns and controls them.

In September 2022 the Corporate Transparency Act (CTA) was enacted into law as part of the Anti-Money Laundering Act of 2020. The CTA requires “reporting companies” to file ownership information with the Department of Treasury’s Financial Crimes Enforcement Network (FinCEN).

The filing requirements encompass a broad swath of business entities, though it primarily affects non-publicly traded companies. There are also 23 exemption categories.

Under the rule, a domestic “reporting company” is defined as any entity that is a corporation, a limited liability company, or is created by the filing of a document with a Secretary of State or similar office under the law of a state or Indian tribe.

A foreign “reporting company” is defined as any entity that is a corporation, a limited liability company, or other entity formed under the law of a foreign country and registered with a Secretary of State or similar office or the law of an Indian tribe.

The government says that information provided to FinCEN will only be accessible to “certain authorized recipients, including law enforcement and regulators, for the purposes of countering money laundering and the financing of terrorism, and for other specific purposes.”

The rule requires reporting companies to file with FinCEN within prescribed time periods:

·    Entities created before January 1, 2024 are required to file by January 1, 2025.

·    Entities created or registered on or after January 1, 2024 and before January 1, 2025 are required to file within 90 days of their creation.

·    Entities created or registered on or after January 1, 2025 are required to file within 30 days of their creation.

The CTA allows for 23 exemption categories. It is important for all entities to review the requirements of the new rule and exemption categories.

For a full text of the Corporate Transparency Act see:


For information on how to file and exemptions see:


SEC Pushes ESG Ruling to Q2 2024

As 2023 comes to a close, the SEC has updated “Final Action” target dates for several ESG-related rules currently on its 2024 Regulatory Agenda, including its broad-sweeping climate disclosure rule.

Initially proposed in March 2022, the rule, officially titled “The Enhancement and Standardization of Climate-Related Disclosures for Investors” is now slated for Final Action in April 2024. The rule’s finalization has been delayed several times since 2022 amid a flood of comment letters and legal challenges.

During an appearance before the US Senate Committee on Banking, Housing and Foreign Affairs earlier this year, the SEC Chairman said that his agency received more than 16,000 comment letters on Scope 3 carbon emission disclosures, which would require companies to report carbon emissions across their supply chain, whether domestic or international.

The proposed rules would require SEC registrants to disclose information about (1) the registrant’s governance of climate-related risks and relevant risk management processes; (2) how any climate-related risks identified by the registrant have had or are likely to have a material impact on its business and consolidated financial statements, which may manifest over the short-, medium-, or long-term; (3) how any identified climate-related risks have affected or are likely to affect the registrant’s strategy, business model, and outlook; and (4) the impact of climate-related events (severe weather events and other natural conditions) and transition activities on the line items of a registrant’s consolidated financial statements, as well as on the financial estimates and assumptions used in the financial statements.

For a complete text of the ESG rule, please see:


In the pipeline

More Employee Disclosures

In April 2024, the SEC is expected to propose a new rule that would require publicity traded companies to provide very detailed information regarding employee demographics, compensation, total cost of a company’s labor and work metrics.

The new rules are being recommended by the SEC’s Investment Advisory Committee (IAC), which said that existing human capital disclosure rules, undated in 2020, don’t go far enough. If SEC Commissioners agree with the IAC recommendations, public companies would be required to disclose the following:

1.  The number of people employed by the issuer, broken down by whether those people are full-time, part-time, or contingent workers.

2.  Turnover or comparable workforce stability metrics.

3.  The total cost of the issuer’s workforce, broken down into major components of compensation.

4.  Workforce demographic data sufficient to allow investors to understand the company’s efforts to access and develop new sources of talent, and to evaluate the effectiveness of these efforts.

The IAC also recommended that the SEC consider narrative disclosure in the Management Discussion & Analysis of how the firm’s labor practices, compensation incentives, and staffing fit within the broader firm strategy. Such a discussion would address what portion of labor costs management views as an investment and why, including how labor is allocated across areas designed to promote firm growth (e.g. R&D) and those necessary to maintain current operations rather than increase sales revenue (e.g. compliance).

Under current rules, public companies are required to disclose the number of employees, as well as human capital risks and resources.

The IAC draft is available here:


Survey Says:

Wall Street Projections on Interest Rate Cuts

If you’re looking to the gurus of Wall Street for guidance regarding if, when or how much the Federal Reserve is planning to cut interest rates in 2024, a recent survey shows that even the big boys aren’t in agreement, with projections swinging from a mediocre 50 basis point cut to an optimistic 275 basis point cut.

Since the Feds started raising rates at the beginning of March 2022 in an effort to tame inflation, its 11 rate hikes have brought the benchmark interest rate to its highest level in 22 years. Wall Street signed in relief when the Fed took a pause, suggesting to some analysts that 2024 will be a year of rate cuts.

Publication Business Insider recently did a survey of what some Wall Street analysts are saying on the subject, and here’s a rundown:

·    Swiss bank UBS issued a note last month saying it believes the US economy will go into a recession in 2024, prompting the Fed to cut interest rates by 275 basis points.

·    Macquarie analysts are projecting a Fed rate cut of 225 basis points in 2024, citing monetary conditions that are a lot tighter than they might appear on the surface.

·    ING Economics is projecting that moderating inflation, cooling job market and less consumer spending will induce the Fed to cut interest rates by 150 basis points.

·    According to CME’s FedWatch Tool, futures markets are figuring on a 125 basis points cut in 2024.

·    Barclays says that a US economy, which continues to show resilience, will keep the Feds cautious about how much to cut. Barclays is predicting a 100 basis point cut.

·    Goldman Sachs, in its note to investors, said that falling inflation and a “healthy” economy will keep rate cuts to 50 basis points, with the first interest rate cut occurring in Q3 2024.

Speculating rates is just that: speculation, with the final say left to the Federal Reserve, which at this week’s policy meeting decided to maintain the status quo for now, keeping the target range for federal funds rate at 5.25-5.50%.

Chairman Jerome Powell said: “…our policy rate is likely at or near its peak for this tightening cycle”, but added, “The Committee is strongly committed to returning inflation to its 2 percent objective. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.”

Barron’s is reporting that “The median forecast in Federal Open Market Committee members’ latest Summary of Economic Projections has the federal-funds rate ending 2024 at 4.6%. Investors expected significantly more cuts in 2024.”

Our firm provides the information in this e-newsletter for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. Tax articles in this e-newsletter are not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided “as is,” with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.