- 44 -
United States, supra.16 Unlike in Korn Indus., Inc., the
accountant’s error in failing properly to apply the link chain
method neither was an interruption in a history of proper
application of that method nor was it restricted to only a portion
of the costs to be taken into account in valuing inventories. The
facts of Korn Indus., Inc. are distinguishable.
ii. Evans v. Commissioner
Petitioners also refer us to Evans v. Commissioner, T.C. Memo.
1988-228. In Evans, the question was whether individual taxpayers
on the cash method of accounting had established a different method
of accounting for employment-related bonuses by, for 3 years,
reporting such bonuses in the year in which the bonuses were
authorized rather than in the year in which they were received.
The taxpayers argued that, for those 3 years, they had merely
misapplied the cash method and, therefore, no change in accounting
method was involved when, in the fourth and fifth years, they
changed their practice of reporting bonuses, from the year
authorized to the year received, and reported the fourth year’s
bonuses in year five. We agreed, concluding that the taxpayers
never intended to adopt an accrual method of accounting for bonuses
16 Though adhering to the holding of its predecessor in
Korn Indus., Inc. v. United States, 209 Ct. Cl. 559 (1976), see
Diebold, Inc. v. United States, 16 Cl. Ct. 193, 204 n.9 (1989),
affd. 891 F.2d 1579 (Fed. Cir. 1989), the U.S. Claims Court (now
the U.S. Ct. of Fed. Claims) has emphasized the primacy of
consistency and timing in establishing a method of accounting.
See Diebold, Inc. v. United States, supra.
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