As part of its on-going commitment to helping members maintain and enhance audit quality and to improve the consistency of quality across the profession, the AICPA recently launched the Enhancing Audit Quality Initiative. Because of the critical nature of the initiative, the AICPA Peer Review Team will take immediate action on two facets of the initiative: identifying emerging industries and high priority audit areas and applying a combination of outreach, training, and robust peer reviews in these industries and areas.
The Peer Review Team has developed a list of potential “deep dive areas” or emerging industries and risk areas, derived through careful analysis of the following:
Continue reading "Peer Review Focus on Maintaining Independence" »
While the Social Security Administration calculates Social Security benefits, it is your due diligence to know the basics so that you can understand how an additional year of earning will affect your clients’ projected benefit.
Some people think Social Security benefits are complicated to figure out; in actuality, it’s pretty straightforward. Social Security benefits are computed through this two-step process:
- Compute the average indexed monthly earnings, called AIME.
- Compute the primary insurance amount, based on the AIME.
Continue reading "The Science Behind Social Security Benefits Calculations" »
"Intaxication: Euphoria at getting a refund from the IRS, which lasts until you realize it was your money to start with." Unknown, from a Washington Post word contest
When is a CPA practice not "practice before the Internal Revenue Service?" And if it is not practice before the IRS, does that mean it’s okay to use contingent fees in a client arrangement?
Why do I write about this topic now? This past July, the U.S. District Court for the District of Columbia issued an opinion (Ridgely v. Lew) that takes a significant strike at IRS’s ability to regulate contingent fee arrangements.
Gerald Ridgely is a CPA who practices with Ryan LLC, a global tax services company, but not a registered CPA firm. Ridgely sued the IRS, arguing that the Service exceeded its authority under Circular 230 in regulating the preparation and filing of ordinary refund claims, which practitioners file after a taxpayer has filed his original tax return but before the IRS has initiated an audit of the return. Ridgely contended that the inability to charge a contingent fee for a refund claim cost him clients and significant revenue. Under a contingent fee arrangement, the client only pays the fee (or a percentage of the refund) if the claim is successful.
Continue reading "Getting to the Bottom Line about Contingent Fees" »
New Year’s Eve is one of the few holidays celebrated almost universally in countries around the world, with parties, champagne toasts, and fireworks. This year, December 31 will also be a key date for management accounting professionals. That’s because it marks the final day that AICPA voting members who meet relevant experience requirements are exempt from the upcoming CGMA exam.
The exam’s unique strategic case-study format is designed to assess problem-solving skills in real-world business situations and test a broad range of competencies defined as crucial by businesses around the world. Since the case study format is quite different from traditional exam techniques like multiple choice or fill-in-the-blanks, we recently released a practice exam that candidates can use to prepare for the exam.
Continue reading "How to Pass the CGMA Exam? Practice, Practice, Practice" »