Tag Archives: accounting

Pentagon says accounting error frees up $6.2 billion for Ukraine military aid – Axios

  1. Pentagon says accounting error frees up $6.2 billion for Ukraine military aid Axios
  2. ‘Going back into the pot’: The Pentagon just made a stunning $6.2 billion accounting error — and it provides extra aid for Ukraine. Here’s exactly what happened Yahoo Finance
  3. Pentagon Reports $6.2 Billion Accounting Error In Valuing Aid To Ukraine Hindustan Times
  4. Pentagon says accounting error frees up extra $6.2 billion for Ukraine ABC15 Arizona in Phoenix
  5. Pentagon to Send Ukraine More Arms After Finding $6.2 Billion “Accounting Error” Democracy Now!

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‘Going back into the pot’: The Pentagon just made a stunning $6.2 billion accounting error — and it provides extra aid for Ukraine. Here’s exactly what happened – Yahoo Finance

  1. ‘Going back into the pot’: The Pentagon just made a stunning $6.2 billion accounting error — and it provides extra aid for Ukraine. Here’s exactly what happened Yahoo Finance
  2. Pentagon accounting error overvalued Ukraine weapons aid by $3 billion KSL.com
  3. Pentagon reports $6.2 billion accounting error in valuing aid to Ukraine The Washington Post
  4. Pentagon Says a $6 Billion Accounting Error Allows More Arms for Ukraine Bloomberg
  5. Pentagon accounting error provides extra $6.2 billion for Ukraine military aid Yahoo News
  6. View Full Coverage on Google News

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Pentagon reports $6.2 billion accounting error in valuing aid to Ukraine – The Washington Post

  1. Pentagon reports $6.2 billion accounting error in valuing aid to Ukraine The Washington Post
  2. ‘Going back into the pot’: The Pentagon just made a stunning $6.2 billion accounting error — and it provides extra aid for Ukraine. Here’s exactly what happened Yahoo Finance
  3. Pentagon Accounting Error Provides Extra $6.2 Billion for Ukraine Military Aid Military.com
  4. Pentagon accounting error overvalued Ukraine weapons aid by $3 billion KSL.com
  5. Pentagon’s Ukraine accounting error revised up to $6.2 billion Reuters.com
  6. View Full Coverage on Google News

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Rick And Morty Creator Leaves Studio Behind Huge Game Pass Hit

Image: Squanch Games

Justin Roiland is leaving Squanch Games just a month after comedic shooter High on Life became 2022’s most popular Xbox Game Pass launch. The studio co-founder who voices many of High on Life’s characters is currently facing two felony domestic abuse charges from 2020.

Squanch Games announced the news late on Tuesday, shortly after Adult Swim revealed that it was dropping Roiland from Rick and Morty as well. But the CEO’s resignation apparently actually occurred over a week ago on January 16, four days after news of the domestic abuse charges first surfaced (which Roiland pled not guilty to), and three days after Kotaku first reported on a 2018 lawsuit accusing the studio of workplace harassment and discrimination (and which it settled in 2019).

“The passionate team at Squanch will keep developing games we know our fans will love while continuing to support and improve High On Life,” the studio tweeted yesterday. Squanch Games did not immediately respond to a request for comment about why Roiland resigned, whether it was aware of any other allegations related to him or the studio, and whether he still holds any equity in Squanch.

Co-founded by Roiland and former Epic Games executive producer Tanya Watson back in 2016, Squanch Games’ early projects included virtual reality games Accounting and Dr. Splorchy Presents: Space Heroes. Those were followed in 2019 by action platformer Trover Saves the Universe. Each of them leaned heavily on voice performances by Roiland that were heavily reminiscent of his work on Rick and Morty.

Last year’s High on Life, which began as a Google Stadia exclusive, was the studio’s biggest game by far, however. In Kotaku’s own review, writer Alyssa Mercante found the humor grating and felt that the running gags overstayed their welcome, but she was pleasantly surprised by the visual style and gunplay. The game similarly divided other critics, but audiences flocked to it on Xbox and PC where it was available day-one on Game Pass.

Whether because of the game’s own merits or the fact that it showed up at the tail end of an otherwise anemic year for Xbox exclusives and blockbusters, it immediately shot up to the top of the charts on Game Pass. Shortly after release, Microsoft crowned it “Xbox Game Pass’ biggest launch of 2022, the biggest 3rd party Game Pass launch of all time, and the biggest release of a single player-only game in the service’s history.”

That accolade came after a big promotional campaign for the game on the platform, including a podcast interview between human Xbox mascot Larry “Major Nelson” Hryb and Roiland, where the latter discussed the game and its influences. That’s gone quiet now, with the Xbox Game Pass Twitter account not tweeting about High on Life since news of the domestic abuse charges first broke.



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Hindenburg shorts India’s Adani Group, flags debt and accounting concerns

BENGALURU, Jan 25 (Reuters) – Hindenburg Research said on Wednesday it held short positions in India’s Adani Group, accusing the conglomerate of improper extensive use of entities set up in offshore tax havens and expressing concern about high debt levels.

The report, which comes days ahead of a $2.5 billion share offering by flagship firm Adani Enterprises (ADEL.NS), sent shares in Adani group firms sliding.

Hindenburg, a well known U.S. short-seller, said key listed companies in the group controlled by billionaire Gautam Adani had “substantial debt” which has put the entire group on a “precarious financial footing”.

It also said that seven Adani listed companies have an 85% downside on a fundamental basis due to what it called “sky-high valuations”.

An Adani spokesperson did not immediately respond to Reuters request for comment on the report, which Hindenburg said was based on research that involved speaking with dozens of individuals, including former Adani Group executives as well as a review of documents.

Hindenburg said it held its short positions through U.S.-traded bonds and non-Indian-traded derivative instruments.

Adani has repeatedly dismissed debt concerns. Adani Chief Financial Officer Jugeshinder Singh told media on Jan. 21 “Nobody has raised debt concerns to us. No single investor has.”

In the wake of the Hindenburg report, Adani Ports And Special Economic Zone (APSE.NS) slid 7.3% to its lowest level since early July, while Adani Enterprises dropped 3.7% to a near three-month low.

Reuters Graphics Reuters Graphics

Adani-owned cement firms ACC (ACC.NS) and Ambuja Cements (ABUJ.NS) fell 6.7% and 9.7% respectively.

Hindenburg’s report said that five of seven key listed Adani companies have reported current ratios – a measure of liquid assets minus near-term liabilities – below 1. This, the short-seller said, suggested “a heightened short-term liquidity risk.”

Adani Group’s total gross debt in the financial year ending March 31, 2022, rose 40% to 2.2 trillion rupees.

Refinitiv data shows that debt at all the Adani Group’s seven key listed Adani companies exceeds equity, with debt at Adani Green Energy Ltd (ADNA.NS) exceeding equity by more than 2,000%.

CreditSights, part of the Fitch Group, described the group last September as “overleveraged” and said it had concerns over its debt. While the report later corrected some calculation errors, CreditSights said it maintained its concerns over leverage.

Hindenburg is known for shorting electric truck maker Nikola Corp (NKLA.O) and Twitter though it later reversed its position in Twitter.

Shares in Adani Enterprises surged 125% in 2022, while other group companies, including power and gas units, rose more than 100%.

Reporting by Mrinmay Dey, Chris Thomas and Aditya Kalra; Additional reporting by Miyoung Kim; Editing by Dhanya Ann Thoppil and Edwina Gibbs

Our Standards: The Thomson Reuters Trust Principles.

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Accounting firm that issued proof of reserves report for Binance halts service to all crypto clients

Mazars, the accounting firm that issued a proof of reserves report posted by cryptocurrency giant Binance last week, has pulled the report from its website and no longer offers the service for its crypto clients.

Binance, the world’s largest crypto exchange, tweeted a link to the report on Dec. 7 as it seeks to reassure clients of its reserves following the collapse of competitor FTX last month.

Binance, the world’s largest crypto exchange, is having difficulty finding an accounting firm to conduct a proof of reserves report. (Jakub Porzycki/NurPhoto via Getty Images / Getty Images)

According to The Wall Street Journal, Mazars scrubbed the report from its site on Friday.

“Mazars has paused its activity relating to the provision of Proof of Reserves Reports for entities in the cryptocurrency sector due to concerns regarding the way these reports are understood by the public,” the accounting group said in an emailed statement to FOX Business.

FORMER FTX SPOKESMAN KEVIN O’LEARY SAYS HE BELIEVES BINANCE PUT FTX ‘OUT OF BUSINESS INTENTIONALLY’

A Binance spokesperson said Mazars “has indicated that they will temporarily pause their work with all of their crypto clients globally, which include Crypto.com, KuCoin and Binance. Unfortunately, this means that we will not be able to work with Mazars for the moment.”

“Ultimately, our users want to know that their funds are secure and that our business is financially strong,” Binance’s statement continued. “To that end, Binance’s capital structure is debt free and, over the past week, Binance passed a stress test that should give the community extraordinary comfort that their funds are secure. Despite the large number of withdrawals 12-14 December, $6B of net withdrawals over three days, we were able to fulfill them without breaking stride.”

Binance said it has reached out to several major accounting firms, including the Big Four, seeking one willing to perform a proof of reserves report. The crypto exchange said the Big Four — which are Deloitte, Ernst & Young, KPMG and Pricewaterhouse Coopers — are all “currently unwilling to conduct a PoR for a private crypto company.”

BINANCE CEO TWEETS ‘BUSINESS AS USUAL’ AFTER PAUSING USDC COIN WITHDRAWAL TUESDAY

The crypto industry has been rocked by the downfall of FTX, leaving investors with major jitters after a run on the bank showed the exchange — worth roughly $40 billion at one point — did not have enough in reserves to honor the withdrawals. The company filed for bankruptcy last month, resulting in billions of dollars in losses for an estimated one million customers worldwide.

FTX founder Sam Bankman-Fried was arrested Monday on several charges connected to his company’s collapse, which prompted calls for greater regulations for the crypto industry by jurisdictions worldwide — including requiring proof of reserves. 

Binance CEO Changpeng Zhao speaks at the Delta Summit, Malta’s official Blockchain and Digital Innovation event promoting cryptocurrency, in St Julian’s, Malta, on Oct. 4, 2018. ( REUTERS/Darrin Zammit Lupi / Reuters Photos)

Binance founder and CEO Changpeng “CZ” Zhao told CNBC’s “Squawk Box” this week that “the well-run crypto exchanges should hold users’ assets one-to-one.”

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“People can withdraw 100% of the assets they have on Binance,” Zhao said. “We will not have an issue, in any given day.”

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The most precise accounting yet of dark energy and dark matter

Credit: NASA/CXC/U.Texas

Astrophysicists have performed a powerful new analysis that places the most precise limits yet on the composition and evolution of the universe. With this analysis, dubbed Pantheon+, cosmologists find themselves at a crossroads.

Pantheon+ convincingly finds that the cosmos is composed of about two-thirds dark energy and one-third matter—mostly in the form of dark matter—and is expanding at an accelerating pace over the last several billion years. However, Pantheon+ also cements a major disagreement over the pace of that expansion that has yet to be solved.

By putting prevailing modern cosmological theories, known as the Standard Model of Cosmology, on even firmer evidentiary and statistical footing, Pantheon+ further closes the door on alternative frameworks accounting for dark energy and dark matter. Both are bedrocks of the Standard Model of Cosmology but have yet to be directly detected and rank among the model’s biggest mysteries. Following through on the results of Pantheon+, researchers can now pursue more precise observational tests and hone explanations for the ostensible cosmos.

“With these Pantheon+ results, we are able to put the most precise constraints on the dynamics and history of the universe to date,” says Dillon Brout, an Einstein Fellow at the Center for Astrophysics | Harvard & Smithsonian. “We’ve combed over the data and can now say with more confidence than ever before how the universe has evolved over the eons and that the current best theories for dark energy and dark matter hold strong.”

Brout is the lead author of a series of papers describing the new Pantheon+ analysis, published jointly today in a special issue of The Astrophysical Journal.

Pantheon+ is based on the largest dataset of its kind, comprising more than 1,500 stellar explosions called Type Ia supernovae. These bright blasts occur when white dwarf stars—remnants of stars like our Sun—accumulate too much mass and undergo a runaway thermonuclear reaction.

Because Type Ia supernovae outshine entire galaxies, the stellar detonations can be glimpsed at distances exceeding 10 billion light years, or back through about three-quarters of the universe’s total age. Given that the supernovae blaze with nearly uniform intrinsic brightnesses, scientists can use the explosions’ apparent brightness, which diminishes with distance, along with redshift measurements as markers of time and space.

That information, in turn, reveals how fast the universe expands during different epochs, which is then used to test theories of the fundamental components of the universe.

The breakthrough discovery in 1998 of the universe’s accelerating growth was thanks to a study of Type Ia supernovae in this manner. Scientists attribute the expansion to an invisible energy, therefore monikered dark energy, inherent to the fabric of the universe itself. Subsequent decades of work have continued to compile ever-larger datasets, revealing supernovae across an even wider range of space and time, and Pantheon+ has now brought them together into the most statistically robust analysis to date.

“In many ways, this latest Pantheon+ analysis is a culmination of more than two decades’ worth of diligent efforts by observers and theorists worldwide in deciphering the essence of the cosmos,” says Adam Riess, one of the winners of the 2011 Nobel Prize in Physics for the discovery of the accelerating expansion of the universe and the Bloomberg Distinguished Professor at Johns Hopkins University (JHU) and the Space Telescope Science Institute in Baltimore, Maryland. Riess is also an alum of Harvard University, holding a Ph.D. in astrophysics.

Brout’s own career in cosmology traces back to his undergraduate years at JHU, where he was taught and advised by Riess. There Brout worked with then-Ph.D.-student and Riess-advisee Dan Scolnic, who is now an assistant professor of physics at Duke University and another co-author on the new series of papers.

Several years ago, Scolnic developed the original Pantheon analysis of approximately 1,000 supernovae.

Now, Brout and Scolnic and their new Pantheon+ team have added some 50 percent more supernovae data points in Pantheon+, coupled with improvements in analysis techniques and addressing potential sources of error, which ultimately has yielded twice the precision of the original Pantheon.

“This leap in both the dataset quality and in our understanding of the physics that underpin it would not have been possible without a stellar team of students and collaborators working diligently to improve every facet of the analysis,” says Brout.

Taking the data as a whole, the new analysis holds that 66.2 percent of the universe manifests as dark energy, with the remaining 33.8 percent being a combination of dark matter and matter.

To arrive at even more comprehensive understanding of the constituent components of the universe at different epochs, Brout and colleagues combined Pantheon+ with other strongly evidenced, independent and complementary measures of the large-scale structure of the universe and with measurements from the earliest light in the universe, the cosmic microwave background.

Another key Pantheon+ result relates to one of the paramount goals of modern cosmology: nailing down the current expansion rate of the universe, known as the Hubble constant. Pooling the Pantheon+ sample with data from the SH0ES (Supernova H0 for the Equation of State) collaboration, led by Riess, results in the most stringent local measurement of the current expansion rate of the universe.

Pantheon+ and SH0ES together find a Hubble constant of 73.4 kilometers per second per megaparsec with only 1.3% uncertainty. Stated another way, for every megaparsec, or 3.26 million light years, the analysis estimates that in the nearby universe, space itself is expanding at more than 160,000 miles per hour.

However, observations from an entirely different epoch of the universe’s history predict a different story. Measurements of the universe’s earliest light, the cosmic microwave background, when combined with the current Standard Model of Cosmology, consistently peg the Hubble constant at a rate that is significantly less than observations taken via Type Ia supernovae and other astrophysical markers. This sizable discrepancy between the two methodologies has been termed the Hubble tension.

The new Pantheon+ and SH0ES datasets heighten this Hubble tension. In fact, the tension has now passed the important 5-sigma threshold (about one-in-a-million odds of arising due to random chance) that physicists use to distinguish between possible statistical flukes and something that must accordingly be understood. Reaching this new statistical level highlights the challenge for both theorists and astrophysicists to try and explain the Hubble constant discrepancy.

“We thought it would be possible to find clues to a novel solution to these problems in our dataset, but instead we’re finding that our data rules out many of these options and that the profound discrepancies remain as stubborn as ever,” says Brout.

The Pantheon+ results could help point to where the solution to the Hubble tension lies. “Many recent theories have begun pointing to exotic new physics in the very early universe, however such unverified theories must withstand the scientific process and the Hubble tension continues to be a major challenge,” says Brout.

Overall, Pantheon+ offers scientists a comprehensive lookback through much of cosmic history. The earliest, most distant supernovae in the dataset gleam forth from 10.7 billion light years away, meaning from when the universe was roughly a quarter of its current age. In that earlier era, dark matter and its associated gravity held the universe’s expansion rate in check.

Such state of affairs changed dramatically over the next several billion years as the influence of dark energy overwhelmed that of dark matter. Dark energy has since flung the contents of the cosmos ever-farther apart and at an ever-increasing rate.

“With this combined Pantheon+ dataset, we get a precise view of the universe from the time when it was dominated by dark matter to when the universe became dominated by dark energy,” says Brout. “This dataset is a unique opportunity to see dark energy turn on and drive the evolution of the cosmos on the grandest scales up through present time.”

Studying this changeover now with even stronger statistical evidence will hopefully lead to new insights into dark energy’s enigmatic nature.

“Pantheon+ is giving us our best chance to date of constraining dark energy, its origins, and its evolution,” says Brout.


Information energy accounts for dark energy, resolves Hubble tension, avoids the ‘big chill,’ and is falsifiable


More information:
Dillon Brout et al, The Pantheon+ Analysis: Cosmological Constraints, The Astrophysical Journal (2022). DOI: 10.3847/1538-4357/ac8e04
Provided by
Harvard-Smithsonian Center for Astrophysics

Citation:
The most precise accounting yet of dark energy and dark matter (2022, October 19)
retrieved 20 October 2022
from https://phys.org/news/2022-10-precise-accounting-dark-energy.html

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These 11 stocks can lead your portfolio’s rebound after the S&P 500 ‘earnings recession’ and a market bottom next year

This may surprise you: Wall Street analysts expect earnings for the S&P 500 to increase 8% during 2023, despite all the buzz about a possible recession as the Federal Reserve tightens monetary policy to quell inflation.

Ken Laudan, a portfolio manager at Kornitzer Capital Management in Mission, Kan., isn’t buying it. He expects an “earnings recession” for the S&P 500
SPX,
+2.69%
— that is, a decline in profits of around 10%. But he also expects that decline to set up a bottom for the stock market.

Laudan’s predictions for the S&P 500 ‘earnings recession’ and bottom

Laudan, who manages the $83 million Buffalo Large Cap Fund
BUFEX,
-2.86%
and co-manages the $905 million Buffalo Discovery Fund
BUFTX,
-2.82%,
said during an interview: “It is not unusual to see a 20% hit [to earnings] in a modest recession. Margins have peaked.”

The consensus among analysts polled by FactSet is for weighted aggregate earnings for the S&P 500 to total $238.23 a share in 2023, which would be an 8% increase from the current 2022 EPS estimate of $220.63.

Laudan said his base case for 2023 is for earnings of about $195 to $200 a share and for that decline in earnings (about 9% to 12% from the current consensus estimate for 2022) to be “coupled with an economic recession of some sort.”

He expects the Wall Street estimates to come down, and said that “once Street estimates get to $205 or $210, I think stocks will take off.”

He went further, saying “things get really interesting at 3200 or 3300 on the S&P.” The S&P 500 closed at 3583.07 on Oct. 14, a decline of 24.8% for 2022, excluding dividends.

Laudan said the Buffalo Large Cap Fund was about 7% in cash, as he was keeping some powder dry for stock purchases at lower prices, adding that he has been “fairly defensive” since October 2021 and was continuing to focus on “steady dividend-paying companies with strong balance sheets.”

Leaders for the stock market’s recovery

After the market hits bottom, Laudan expects a recovery for stocks to begin next year, as “valuations will discount and respond more quickly than the earnings will.”

He expects “long-duration technology growth stocks” to lead the rally, because “they got hit first.” When asked if Nvidia Corp.
NVDA,
+5.93%
and Advanced Micro Devices Inc.
AMD,
+3.77%
were good examples, in light of the broad decline for semiconductor stocks and because both are held by the Buffalo Large Cap Fund, Laudan said: “They led us down and they will bounce first.”

Laudan said his “largest tech holding” is ASML Holding N.V.
ASML,
+3.60%,
which provides equipment and systems used to fabricate computer chips.

Among the largest tech-oriented companies, the Buffalo Large Cap fund also holds shares of Apple Inc.
AAPL,
+3.13%,
Microsoft Corp.
MSFT,
+3.85%,
Amazon.com Inc.
AMZN,
+6.28%
and Alphabet Inc.
GOOG,
+4.05%

GOOGL,
+3.86%.

Laudan also said he had been “overweight’ in UnitedHealth Group Inc.
UNH,
+1.31%,
Danaher Corp.
DHR,
+2.60%
and Linde PLC
LIN,
+2.30%
recently and had taken advantage of the decline in Adobe Inc.’s
ADBE,
+1.97%
price following the announcement of its $20 billion acquisition of Figma, by scooping up more shares.

Summarizing the declines

To illustrate what a brutal year it has been for semiconductor stocks, the iShares Semiconductor ETF
SOXX,
+2.02%,
which tracks the PHLX Semiconductor Index
SOX,
+2.22%
of 30 U.S.-listed chip makers and related equipment manufacturers, has dropped 44% this year. Then again, SOXX had risen 38% over the past three years and 81% for five years, underlining the importance of long-term thinking for stock investors, even during this terrible bear market for this particular tech space.

Here’s a summary of changes in stock prices (again, excluding dividends) and forward price-to-forward-earnings valuations during 2022 through Oct. 14 for every stock mentioned in this article. The stocks are sorted alphabetically:

Company Ticker 2022 price change Forward P/E Forward P/E as of Dec. 31, 2021
Apple Inc. AAPL,
+3.13%
-22% 22.2 30.2
Adobe Inc. ADBE,
+1.97%
-49% 19.4 40.5
Amazon.com Inc. AMZN,
+6.28%
-36% 62.1 64.9
Advanced Micro Devices Inc. AMD,
+3.77%
-61% 14.7 43.1
ASML Holding N.V. ADR ASML,
+3.60%
-52% 22.7 41.2
Danaher Corp. DHR,
+2.60%
-23% 24.3 32.1
Alphabet Inc. Class C GOOG,
+4.05%
-33% 17.5 25.3
Linde PLC LIN,
+2.30%
-21% 22.2 29.6
Microsoft Corp. MSFT,
+3.85%
-32% 22.5 34.0
Nvidia Corp. NVDA,
+5.93%
-62% 28.9 58.0
UnitedHealth Group Inc. UNH,
+1.31%
2% 21.5 23.2
Source: FactSet

You can click on the tickers for more about each company. Click here for Tomi Kilgore’s detailed guide to the wealth of information available free on the MarketWatch quote page.

The forward P/E ratio for the S&P 500 declined to 16.9 as of the close on Oct. 14 from 24.5 at the end of 2021, while the forward P/E for SOXX declined to 13.2 from 27.1.

Don’t miss: This is how high interest rates might rise, and what could scare the Federal Reserve into a policy pivot

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Social Security COLA will be 8.7% in 2023, highest increase in 40 years

Azmanjaka | E+ | Getty Images

Amid record high inflation, Social Security beneficiaries will get an 8.7% increase to their benefits in 2023, the highest increase in 40 years.

The Social Security Administration announced the change on Thursday. It will result in a benefit increase of more than $140 more per month on average starting in January.

The average Social Security retiree benefit will increase $146 per month, to $1,827 in 2023, from $1,681 in 2022.

The Senior Citizens League, a non-partisan senior group, had estimated last month that the COLA could be 8.7% next year. 

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Here’s a look at other stories impacting the financial advisor business.

The confirmed 8.7% bump to benefits tops the 5.9% increase beneficiaries saw in 2022, which at the time was the highest in four decades.

The last time the cost-of-living adjustment was higher was in 1981, when the increase was 11.2%.

Next year’s record increase comes as beneficiaries have struggled with increasing prices this year.

“The COLAs really are about people treading water; they’re not increases in benefits,” said Dan Adcock, director of government relations and policy at the National Committee to Preserve Social Security and Medicare.

“They’re more trying to provide inflation protection so that people can maintain their standard of living,” Adcock said.

How much your Social Security check may be

Beneficiaries can expect to see the 2023 COLA in their benefit checks starting in January.

But starting in December, you may be able to see notices online from the Social Security Administration that state just how much your checks will be next year.

Two factors — Medicare Part B premiums and taxes — may influence the size of your benefit checks.

The standard Medicare Part B premium will be $5.20 lower next year — to $164.90, down from $170.10. Those payments are often deducted directly from Social Security benefit checks.

“That will mean that beneficiaries will be able to keep pretty much all or most of their COLA increase,” Mary Johnson, Social Security and Medicare policy analyst at The Senior Citizens League, told CNBC.com this week.

That may vary if you have money withheld from your monthly checks for taxes.

To gauge just how much more money you may see next year, take your net Social Security benefit and add in your Medicare premium and multiply that by the 2023 COLA.

“That will give you a good idea what your raise will be,” said Joe Elsasser, an Omaha, Nebraska-based certified financial planner and founder and president of Covisum, a provider of Social Security claiming software.

How the COLA is tied to inflation

The COLA applies to about 70 million Social Security and Supplemental Security Income beneficiaries.

The change is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W.

The Social Security Administration calculates the annual COLA by measuring the change in the CPI-W from the third quarter of the preceding year to the third quarter of the current year.

Benefits do not necessarily go up every year. While there was a record 5.8% increase in 2009, the following two years had 0% increases.

“For seniors, because they spend so much on health care, those years were difficult,” Adcock said.

A similar pattern may happen if the economy goes into a recession, according to Johnson.

What the COLA means if you haven’t claimed benefits yet

If you decide to claim Social Security benefits, you will get access to the record-high COLA.

But you will also have access to it if you wait to start your benefit checks at a later date, according to Elsasser.

If you’re 62 now and don’t claim, your benefit is adjusted by every COLA until you do.

The amount of the COLA really should not influence claiming.

Joe Elsasser

CFP and president of Covisum

What’s more, delaying benefits can increase the size of your monthly checks. Experts generally recommend most people wait as long as possible, until age 70, due to the fact that benefits increase 8% per year from your full retirement age (typically 66 or 67) to 70. To be sure, whether that strategy is ideal may vary based on other factors, such as your personal health situation and marital status.

“The amount of the COLA really should not influence claiming,” Elsasser said. “It doesn’t hurt you or help you as far as when you claim, because you’re going to get it either way.”

How a record-high increase may impact Social Security’s funds

Social Security’s trust funds can pay full benefits through 2035, the Social Security Board of Trustees said in June.

At that time, the program will be able to pay 80% of benefits, the board projects.

Tetra Images | Tetra Images | Getty Images

The historic high COLA in 2023 could accelerate the depletion of the trust funds to at least one calendar year earlier, according to the Committee for a Responsible Federal Budget.

Higher wages may prompt workers to contribute more payroll taxes into the program, which may help offset that. In 2023, maximum taxable earnings will increase to $160,200, up from $147,000 this year.

What could happen to future benefit increases

While 2023 marks a record high COLA, beneficiaries should be prepared for future years where increases are not as high.

If inflation subsides, the size of COLAs will also go down.

Whether the CPI-W is the best measure for the annual increases is up for debate. Some tout the Consumer Price Index for the Elderly, or CPI-E, as a better measure for the costs seniors pay. Multiple Democratic congressional bills have called for changing the annual increases to that measure.

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Amazon, Berkshire Hathaway Could Be Among Top Payers of New Minimum Tax

Researchers at the University of North Carolina Tax Center analyzed securities filings to determine what companies would have paid if the tax had been in place last year. They found fewer than 80 publicly traded U.S. companies would have paid any corporate minimum tax in 2021, and just six—including Amazon and

Warren Buffett’s

conglomerate—would have paid half of the estimated $32 billion in revenue the levy would have generated.

The tax, which takes effect in January, is the largest revenue-raising provision in Democrats’ climate, healthcare and tax law. The provision, projected to generate $222 billion over a decade, alters tax incentives and complicates corporate tax decisions. Democrats aimed the provision at large companies that report profits to shareholders but pay relatively little tax.

Berkshire Hathaway would have paid $8.3 billion last year if the new tax law had been in place, according to UNC estimates.



Photo:

Michelle Bishop/Bloomberg News

“Who actually pays a lot is just not very many firms at all,” said Jeff Hoopes, an accounting professor at UNC Chapel Hill who is one of the study’s authors. “My guess is it will not be the same firms every single year.”

Although this wasn’t the aim of the law, it could have an impact on some of the wealthiest Americans. Some Democrats proposed direct taxes on billionaires’ unrealized capital gains earlier in the legislative process. While that wasn’t adopted, the new corporate minimum tax would increase the tax burden on some wealthy shareholders, such as Warren Buffett at Berkshire and

Jeff Bezos

at Amazon.

Mr. Buffett owned 16% of Berkshire Hathaway’s shares earlier this year, while Mr. Bezos owned nearly 13% of Amazon’s, securities filings show. Representatives for Messrs. Bezos and Buffett declined to comment.

Corporate tax directors and accounting firms are also analyzing the law, figuring out how they are affected and preparing to lobby over regulations. Few have estimated its impact publicly.

The UNC analysis comes with caveats. Lacking confidential tax returns that would allow precise calculations, the authors used publicly available financial data. Companies might change behavior to minimize taxes. A one-year snapshot includes unusual situations that cause companies to pay the minimum tax once, generating tax credits that can be used in future years.

Jeff Bezos owned nearly 13% of Amazon shares earlier this year, securities filings indicated.



Photo:

Jay Biggerstaff/USA TODAY Sports

Under the new law, companies averaging more than $1 billion in publicly reported annual profits calculate their taxes twice: once under the regular system with a 21% rate and again with a 15% rate and different rules for deductions and credits. They pay whichever is higher.

The new system, known as the book minimum tax, starts with income reported on the financial statement, not traditional taxable income. Differences between the two—the treatment of stock-based compensation, for example—could drive a company into paying the new tax.

According to the UNC estimates, Berkshire Hathaway would have paid the most in 2021, at $8.3 billion—or about a quarter of the estimated total—followed by Amazon at $2.8 billion and

Ford Motor Co.

at $1.9 billion.

Add the next three companies and that reflects more than half the $31.8 billion total:

AT&T Inc.

at $1.5 billion,

eBay Inc.

at $1.3 billion, and

Moderna Inc.

at $1.2 billion.

Berkshire Hathaway didn’t comment. Amazon declined to comment on the figure but said it awaits federal guidance. Amazon said its taxes reflect a combination of investment and compensation decisions and U.S. laws.

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An AT&T spokesman said the company doesn’t expect the minimum tax to affect its 2023 tax bill. “Academics don’t prepare our taxes; trained and expert tax professionals do that work,” the spokesman said.

Moderna’s tax rate in 2021—its first year with an operating profit—was shaped by the use of deductible net operating losses generated from research expenses, said

Jamey Mock,

the company’s chief financial officer. The company also paid much of its 2021 taxes during 2022. “We do not anticipate those unique conditions factoring into our future tax considerations,” he said.

Melissa Miller, a Ford spokeswoman, said the company pays all the taxes it owes and pointed to tax credits in the law designed to accelerate the transition to electric vehicles.

Heather Jurek, eBay’s vice president of tax, said the study’s computations and interpretations of the law are inaccurate when applied to the company. “UNC’s conclusions are driven by a significant disposition in 2021 that eBay is unlikely to replicate,” she said.

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Exelon Corp.

is among the few companies that has disclosed what it anticipates to be detailed effects from the tax. The utility-services holding company said in an August securities filing that it expected to incur annual cash costs of about $200 million starting next year, down from an earlier $300 million estimate.

Exelon said it continues to evaluate the tax provision and it expects to benefit from legislative provisions encouraging investment in electric vehicles and electrical-grid modernization.

Lynn Good,

chief executive of

Duke Energy Corp.

, told investors in August that the utility giant also expects to be affected, without providing figures. A spokesman said the UNC estimate, $802 million based on 2021 income, is far too high. He said the company also expects to benefit from the legislation’s tax credits for renewable and nuclear power.

Linking taxes closer to publicly reported profits is intentional. It will become harder for companies to maximize profits to impress shareholders while managing taxable profits downward to minimize payments to governments, tax advisers say.

Mr. Biden has said the new tax means that the days of profitable companies paying no tax are over.

“There are companies that, for a variety of reasons, will perpetually be in a minimum-tax position,” said April Little of accounting firm Grant Thornton LLP.

Some profitable companies could still pay very little or no federal income taxes. Companies can offset up to 75% of tax liability with credits—including renewable-energy incentives Congress just expanded. The law includes special provisions benefiting companies with wireless spectrum investments, defined-benefit pensions and significant capital investments.

“We have the anti-loophole tax bill that’s full of loopholes,” Mr. Hoopes said.

Tax advisers say companies are trying to understand the law, pointing to uncertainties such as the treatment of currency losses and gains, capitalized depreciation deductions and rules around mergers and acquisitions.

By early next year, companies will start providing earnings guidance, making estimated-tax payments and reflecting the tax in quarterly earnings. They might also start crafting mitigation strategies and looking for flexibility in the accounting rules for when income and expenses are counted.

“What I see most people doing right now is worrying about: How is it supposed to work? How am I going to do this without going crazy?” said Diana Wollman, a partner at law firm Cleary, Gottlieb, Steen & Hamilton LLP.

“They’re spending more time trying to figure out what they want to ask for in regulations in terms of either clarity or regulatory discretion than they are trying to figure out how they’re going to game it,” Ms. Wollman said.

Write to Richard Rubin at richard.rubin@wsj.com and Theo Francis at theo.francis@wsj.com

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