Virtual Work Teams Are Coming

As the economy continues to recover, the impending retirement of our nation’s Baby Boomers will create a labor shortage far greater than any we have experienced in the U.S. Professionals with the right skills will have their choice of employment opportunities, which will drive demand – and salaries – up. CPA firms that provide truly motivational and engaging environments will win the recruiting and retention race.

That’s why learning to manage the challenges and possibilities of virtual work teams is a must for today’s current and emerging partners. The need for increased workplace flexibility generates passionate conversations by CPA firm leaders and team members. Employees are challenged to keep a steady balance between their work and their personal lives as demands in each continuously change. Some aren’t willing to make the firm their top priority.

5 Things CPAs Need to Know about Integrated Reporting

Last week, my blog post discussed that Integrated Reporting <IR> represents an important shift in corporate reporting in which CPAs can play a key role providing consulting services, implementation or report preparation. In today’s blog, I’m drilling down into some of the key concepts of the recently released Consultation Draft of the International <IR> Framework that are important for CPAs to understand.

Five features of the Draft Framework are:

Evolution of Corporate Reporting: Integrated Reporting

Corporate reporting in the U.S. and around the world has often developed as disparate strands of reporting.  Stakeholders have grown to seek more and more information in a number of different reporting vehicles, but do they really seek the details or are they trying to drive better corporate practice?

Integrated Reporting <IR> represents an evolution of corporate reporting that focuses attention on how an organization creates value in the short, medium and long term.  An integrated report, a key output of Integrated Reporting, is a concise report primarily intended for investors of financial capital, although other stakeholders who have an interest in the organization’s ability to create value will also benefit from such communications. 

How Would an Unlimited Vacation Policy Work in Your CPA Firm?

After this crazy, compressed tax season, you and your employees are certainly ready and deserve a vacation. But do you give your employees enough vacation time? How much paid vacation time is enough? Can you imagine that the answer might someday be “as much as they want?” Some companies are shifting toward an unlimited vacation policy because they believe it can enhance morale and minimize stress. Although only 1% of organizations offer unlimited paid time off, according to a Society for Human Resource Management survey, it is surprisingly most often used at smaller organizations. There are a number of advantages to offering unlimited vacation time in your CPA firm. They include:

Why I’m a Financial Literacy Volunteer

Teaching financial literacy continues to be one of the most gratifying activities of my career.  Although it requires a portion of my already limited time, the rewards (tangible and intangible) are tremendous. Following are the reasons I think public service via financial education is important to us as individual CPAs as well as to our profession.

The Need is Great

Financial education is not taught in our public schools and our economic/financial environment continues to become increasingly complex. Many people do not have the basic information they need to make financial decisions and they don’t know whom to trust. There are large segments of our population who need the professional, objective advice that CPAs can give, but who cannot afford the fees: teenagers and college students, the elderly and middle/low income adults, to name a few.  

8 Tax Reform Questions Congress Needs to Raise (and Answer)

It looks like comprehensive tax reform is gaining some sense of realism. Consider these important actions so far this year:

• President Obama mentioned it in his January 2013 State of the Union address: "Now is our best chance for bipartisan, comprehensive tax reform that encourages job creation and helps bring down the deficit.  We can get this done."
• The House Ways and Means Committee formed 11 working groups to address specific areas for reform.
• On March 21, the Senate Finance Committee began issuing Tax Reform Option Papers -the first one covers simplification for families and businesses.
• Tax reform is mentioned in both the House and Senate FY2014 Budget Resolutions produced by the budget committees.

6 Things Not-For-Profits Need to Know about Non-Cash Contributions

Not-for-profits continue to encounter unique measurement challenges for gifts in kind. There are a variety of approaches available for not-for-profits to value GIK, which can result in large disparities between handlings by different not-for-profits and questions about the application of generally accepted accounting practices to GIK. Other issues such as identifying the applicable principle markets and the effect of nominal fees on GIK require not-for-profits to scrutinize their GIK practices to ensure GAAP is being properly applied.

Not-for-profits must measure all non-cash contributions such as items auctioned off for charity; excess or obsolete goods given to charity to help fulfill its mission; free print or web advertising space and even radio advertisement air time. However, measuring these intangible items can be challenging, as not-for-profits who receive such gifts would not otherwise purchase or sell them and not-for-profit administrators simply may not know the fair market value of these gifts or have access to valuation information.

The Cloud: Just One SOC Opportunity

It's no secret that an organization's confidential information is vulnerable in today's world of electronic storage. If you have any doubt, just ask The New York Times or The Wall Street Journal – both of which recently reported having their computer systems hacked.

Organizations transferring storage and/or the processing of their data to cloud-based systems are faced with the added complexities of how to best maintain ownership and control data while continuing to assure customers they have controls in place to keep data secure. How can organizations provide their stakeholders with comfort related to this transferred information?

Service Organization Control Reports^SM represent the intersection of cloud computing and the trusted advisor role of the CPA. In 2011, the AICPA introduced three SOC reporting options: SOC 1^SM, SOC 2^SM and SOC 3^SM reports, creating a great opportunity for CPAs to assert their knowledge and capabilities related to examining and reporting on controls at service organizations, including cloud service providers.

Using Technology to Automate Finance and Help You Make Better Business Decisions

Everyone is being asked to do more with less in the current economy; CFOs are no different. Many are looking for ways to enhance and streamline the finance function, from transaction processing to budgeting and reporting. Automation through leveraging state of the art technology is a key component to assist in this endeavor. With advancements in business applications and cloud-based technology like Intacct, Bill.com and others, virtual work environments, mobility and instant data is the new norm.

9 Tips for Invigorating Weary Brains, Bodies and Balance Sheets

Whew! After months of long hours, you and your colleagues are likely finishing up the first filing deadlines of the year. Nice going!

Even with April 15 clearly in sight, there’s still work to be done by many practitioners. Clients are counting on your smarts like never before to help them make sense of their financial situation in this new environment and find ways to improve it. Let’s face it, you are running on fumes, yet you are far from the finish line and a well-earned break.

The big question you may be asking now is, “How can I get an energy boost so I’ll have the stamina to deliver on the promises I have made to my clients?”   

It’s no secret that when human engines are operating at full throttle they need more than adrenaline to perform their best. Sure, we know that we should eat right, exercise and be good to our bodies and minds if we want to sustain our ability to work at a record pace. The trick is finding the proper balance to yield the needed strength when our days are jam packed with meetings and client commitments.

Here are nine best practices to reinvigorate you so you can be your best. Even better, they are not complicated, expensive or unfamiliar. 

Innovation through Sustainability: It’s as Simple as Soda Pop

Call it what you will: pop, soda, Coke, Pepsi, Cheerwine, bubbly juice… countless Americans have an insatiable thirst for carbonated drinks, but we all know the costs of consuming a lot of soda over time can add up and it’s often bad for us. Plus, the discarded cans and bottles take a heavy toll on the environment, piling up in landfills across the world.

Enter SodaStream, an appliance you can use to make carbonated drinks straight from the faucet. SodaStream International Ltd., the product’s manufacturer, has a completely sustainable business model featuring reusable bottles that can last one year or more, rechargeable CO₂ canisters and any number of flavored syrups to liven up your drink. The result: landfills are spared more than 1,000 plastic bottles per consumer every year, customers reuse system components, and this savvy company gains major profits and a well-earned reputation for being innovative and environmentally conscious. Over the past few years the company has also achieved remarkable growth, increasing revenue by 51% and net income by nearly 60% from 2011 to 2012. What CFO wouldn’t be impressed with that?

Is Hiring a CPA Worth it? 5 Tips for Getting Your Money’s Worth

Often when people find out I’m a tax accountant, I get asked, “How much does a CPA cost?”  It’s like me asking “How much does a home cost?” We all understand that a 1,000 square-foot home in Kansas has a different cost than a 1,000 square-foot penthouse condo in New York City.  The same concept applies to CPAs.  

The answer to both questions is the same:  it depends.  For example, my uncle has a simple tax return and pays $250 in preparation fees.  On the other hand, I had a client whose return took over a week to prepare when I worked in a large firm, which cost the client around $100,000. 

A good CPA may cost you more upfront but will pay off in the long run because he or she is thorough.  Anyone can drop numbers in software.  However, a CPA will analyze the situation to look for tax savings opportunities and help you plan for next year – in short, they become your trusted advisor.  I once had a client whose former preparer had cost her an additional $4 million in taxes because he didn’t consider accelerating her fourth quarter estimated tax payment to December from January.  

With So Much Information, Who’s to Say What’s Accurate?

"We are drowning in information, while starving for wisdom. The world henceforth will be run by synthesizers, people able to put together the right information at the right time, think critically about it, and make important choices wisely."
--E. O. Wilson, American Scientist

On my smartphone I have four different weather apps. Isn’t it amazing we live in a world where we can find out the weather in seconds on demand? Of course, there’s a price to pay for having so much information available at our fingertips. On any given day, I could consult each app and they each might tell me a different forecast for the day or week. That’s not a huge issue if the difference is a matter of about four degrees in the summertime. I’m not sure I can tell the difference between 74 and 78 degrees, anyway. But what about winter? I may not be able to feel the difference between 31 and 35 degrees, but my steep driveway can definitely convey the difference to me quite well as I spin my wheels on black ice on my way to work in the morning.

That’s why it’s vital that you feel confident about the information you use day-to-day—at home and in business.

How Peer Review Strengthened Our Firm

Our firm, Gentile Pismeny & Brengel, LLP, headquartered in Great Neck, N.Y., has undergone eight peer reviews since 1991. These reviews have consistently proven to be highly beneficial, providing us with new insights into how we can strengthen our firm, and in turn, the profession. In fact, we see such value in the process that we’ve recently decided to expand our array of services to include peer review.

Wondering what peer review can do for your firm?  Read on to discover why we feel so strongly about it.

Host a “Welcome to Tax Season” Celebration

"The Bruce Dickinson" (Christopher Walken) delivering the iconic phrase "...more cowbell!" (Photo credit: Wikipedia)

As we enter one of the most anticipated times of the year, why not host a celebration to mark its arrival? You know, show the business community that you are excited about this special season.

“Are you C-R-A-Z-Y?” you might be asking. It’s tax time. Parties are just not what we do right now.

This year, maybe it’s time for a change. Do something different. Welcome the arrival of tax season with clients and friends of the firm. After all, it’s your time to shine. Embrace your place in the spotlight.  

Take a tip from movie producers and best-selling authors who hold premiere parties when they release new films and books. Believe it or not, there are a number of strategies that you can adapt from their attention grabbing events. Even though your firm isn’t likely to have such an extravagant budget, you can achieve the same results with a simple gathering. It’s all about getting your audience excited! Not to mention spreading the word about your firm with viral conversation starters such as “Guess where I’m going tonight?” or “You will never believe who threw such a great party last evening.”

New Reporting Framework Will Eliminate “Noise” for Bankers, Other Financial Statement Users

In my almost 20 years in the banking industry, I’ve come across dozens of owners and managers of small private companies who cringe when it comes time to prepare financial statements. That’s because for many of them, the process is complicated, time consuming and costly. Moreover, a number of rules they are required to follow do not deliver financial information relevant to their businesses. These small- and medium-sized entities have been in need of a financial reporting option that is tailored to their circumstances and produces financial statements and information that their bankers can use and rely upon. Now, finally, that financial reporting framework is being made a reality.

One of my most rewarding professional experiences has been serving on the task force that is developing the new Financial Reporting Framework for Small- and Medium-Sized Entities. What’s a SME? No standard definition exists, but the acronym is self explanatory – small and medium size entities, which happen to make up about 20 million for-profit companies in the United States.

Use Social Media, Don’t Let It Use You

The AICPA’s Forensic and Valuation Service Conference, held Nov. 11 through 13, involved several sessions that were taught the “un-conference way.” These sessions were unconventional in their approach and involved peer-to-peer interactive learning. One un-conference session I attended was Tom Hood’s “Getting an ROI from Social Media via ROA (Return on Attention).” Tom is the CEO of the Maryland Association of CPAs and is considered a top thought leader in accounting.

From the moment we entered the room, we were thrown headfirst into the world of social media, as Tom encouraged us to sign into the gosoapbox event. Tom kicked off the session with a survey of attendees’ social media habits. In our group, 11% did not use social media at all and 71% viewed social media as a time sink, a valid concern for professionals who already have very demanding schedules. 

Tax Season: Our Time to Shine

It’s almost tax season once again. Can you think of a better way to kick off 2013 than adopting a fresh approach to this ever important time of year?

Here’s a thought: What if we all agree to tell a new story this tax season? Instead of framing it as a time to work your fingers to the bone, embrace the notion that tax season is your time to shine. Don’t you owe it to yourself, your colleagues and your clients to let the world know that you love tax time? After all, it’s what you have studied for and worked toward throughout your career. Even better, it’s the time when the world looks to the CPA profession for its tax smarts and number savvy, problem solving know-how.

The Defining Dozen: 12 Metrics CPA Firms Should Track

This time of year, CPA firms are thinking and planning ahead for their busiest season. That makes now a good time to consider whether your CPA firm will be operating at peak efficiency. Is your CPA firm making the most of current relationships and doing all it can to expand into new ones? While there are many metrics CPA firms use to evaluate quantitative performance, here are 12 metrics than can provide more qualitative feedback. These metrics can help CPA firms measure their reach with clients and provide insight into how well processes already in place are helping to identify opportunities with clients.

Benevolence Is Back

Benevolence is a word my grandmother would have used.  But I’m bringing benevolence back. Two years ago, I joined an incredible group of trustees on the AICPA’s Benevolent Fund. This experience has changed me. The Fund’s mission is to help our members. The trustees’ immediate goal is to raise awareness that the Fund exists so members know where to turn when unplanned financial emergencies occur.

The Benevolent Fund is a tangible expression of compassion. It’s a refreshing departure from the normal gruff and impersonal business world. The Fund has been quietly sprinkling generosity and kindness via financial assistance to needy AICPA members for nearly 80 years. Eighty years of benevolence. 

Becoming a Better Expert Witness

Earlier this year, the AICPA Forensic and Valuation Services Conference was held in Orlando. In the past, forensic services and valuation services held separate conferences; this year, in recognition of the fact that many CPAs perform a combination of these services, the two events were joined. As many as eight concurrent sessions were available to attendees on topics including basic, advanced and practical forensic and valuation issues; practice management and marketing; and litigation issues. 

As a CPA who performs primarily valuation services for litigation, two issues of particular interest for me were expert testimony and the cost of capital in business valuations. Ron Seigneur moderated a panel of three attorneys in a session titled “What Do Lawyers Really Say About FVS Experts?” This session was a great look into what attorneys are looking for in an expert and how expert testimony can be most effective. 

Fair Value: A Hot Topic at the FVS Conference

A recent report published in August 2012 by the Public Company Accounting Oversight Board outlines certain deficiencies in audit procedures with respect to a clients’ fair value determinations. The report explains these deficiencies, which included, among others, fair value determinations of investment securities and business combinations. With the increased scrutiny on fair value measurements and the increase in business combinations during 2012, how will audit firms and valuation professionals educate themselves to improve the quality of their work?

What’s in a Name?

IT Section Renamed to Information Management and Technology Assurance

Names have power. Corporations invest millions of dollars and countless hours of focus group sessions before a major name change. Names provide insight into an entity or company’s background and mission. They also help us infer certain characteristics about an organization or set expectations for how it delivers a particular product, service, or experience.

Consider these famous name changes for a moment. Would Google be as ubiquitous if it had kept BackRub as its name? Would the cola wars rage on if Coke were competing against Brad’s Drink or against its newer moniker, Pepsi? Innovation, mergers or a decision to move in a different direction can lead companies, organizations and other entities to outgrow their names.

Quite simply, a name change allows organizations to better reflect their purpose and what they offer. For this reason, the AICPA renamed the Information Technology Section to the Information Management and Technology Assurance Section.

Merchant Card Reporting Compliance Raises Its Head Again

CPAs are well aware of how Form 1099 reporting improves tax return compliance. CPAs are also aware of how the 1099 rules can lead to considerable taxpayer frustration or opposition. For example, during the 2012 filing season, we heard a lot about the difficulties taxpayers had trying to comply with the new cost basis information reporting rules for brokers reporting stock sales; and this particular issue remains a concern of ours. Another major initiative, which until recently seemed like a sleeper issue, is now ripe for taxpayer focus. Merchant card companies are required to report (on Form 1099-K) the gross receipts that a business receives from customers paying with merchant cards during the year. Merchant cards typically include both credit cards and debit cards.

3 Ways to Improve Your CPA Firm’s Website

CPAs excel at providing exceptional service once our clients are in the door – but actually getting them in the door is another story.

With the advent of social media and the ever-important search engine rankings, CPAs may find the world of marketing more challenging.

Your company website is your #1 marketing tool.

Think about it – when you need something, what do you do?

You Google it (or at least most people do).

If you click on a website in the search listings and you don’t like what you see or are confused – you bounce. You leave the site, which is what many of your potential customers are doing if your site isn’t up to par.

Let’s say that a potential client lands on your website.

What do they see? Do they know what to “do” once they land?

Microsoft’s Windows 8 Experiment Will Affect All CPAs

Windows 8 Presentation (Photo credit: Michael Kappel)

Remember when Microsoft was the 800-pound gorilla, the dominant software maker, the most valuable company in the world? That was about the time when Microsoft invested $150 million to save rival Apple from bankruptcy.

Fast-forward 15 years, and Apple has risen from the ashes to become the hottest company on Earth—a corporate behemoth that, for a time earlier this year, boasted the highest market capitalization in history, a claim Microsoft once could make.

Microsoft, meanwhile, has slipped from its perch on top of the corporate world and while it is still a business giant nowhere near a bankruptcy filing, the business shift from desktops and laptops to mobile devices and the cloud has put Microsoft in the unfamiliar position of playing from behind.

Using KPIs to Become a Trusted NPO Business Advisor

Key Performance Indicators, while frequently discussed in the for-profit sector, can be an essential aspect of a non-profit organization’s financial health and performance. KPIs are quantifiable measurements of an organization’s health or success. Determining what KPIs are important for a particular organization can be difficult, especially if that organization isn’t a franchise in a larger collection of organizations. As a CPA, you can identify KPIs for your NPO clients, explaining how they can use these indicators to their advantage. When understood, KPIs can allow NPOs to benchmark their progress against peer organizations for context about healthy and not healthy positions to be in.

Important principles to remember when helping your nonprofit clients select and identify KPIs:

What Is the AICPA’s Health Care Expert Panel and What Do They Do?

Up until about a year ago, I had only heard that the AICPA has expert panels  but I didn’t really have any idea about what they are or what they do. I was asked to staff the Health Care Expert Panel  and I can tell you last year has been quite a ride!

Who Is the Health Care Expert Panel and What Is Its Mission?

The Panel consists of 13 members who represent a mixture of firm practitioners as well as preparers and users who work in the industry. They all have one thing in common—they are considered to be some of the health care industry’s “cream of the crop” and best equipped to carry out the panel’s mission to protect the public interest and address the needs of AICPA members in the areas of financial reporting (including business reporting), audit and attest services, and regulatory matters from the health care industry perspective.

Selling a Business or Advising a Seller? Tips to Navigate the Fiscal Cliff

With about 10 weeks left in the calendar year, it would be difficult for even the most motivated business owners to complete their company’s sale by Dec. 31, unless they’re already in process.

Some owners are hustling to get that process done to avoid falling over the tax cliff set to take effect Jan. 1. But the principles of selling a business apply no matter what the calendar says, according to Scott Miller, CPA/ABV, an expert presenter for the Oct. 30 Journal of Accountancy webcast, Inside Buyout Basics and the Tax Cliff: A Timely Combination.

What is a ‘Digital CPA’?

There’s no question technology is having a huge impact on how CPAs and their clients conduct business, but the adoption rate isn’t uniform within the profession. Some practitioners are taking a wait-and-see approach. Others are sticking their toes in the water. And still another group is fully embracing technology and all that it promises—integrating innovation throughout their firm’s processes and workflows and becoming digitally present in today’s online world.

At CPA2Biz, we use the term ‘Digital CPA’ to describe the latter category. The Digital CPA harnesses the power of the cloud, the broad use of mobile devices and a carefully calibrated online presence to attract clients and build new service lines. It’s inevitable the entire profession will arrive at this same place one day – and that day isn’t far off.

5 Improvements to Civil Litigation Procedure for Financial Expert Witnesses

How can civil litigation become less costly and complicated and more fair for all involved? Although rules of civil procedure call for a quick, inexpensive and fair determination of all civil actions, those goals often are not met. The AICPA Forensic and Valuation Services Executive Committee and the members of the FVS membership section are well aware of the many problems within the system that can cause lengthy delays and unnecessary expenses. Because CPAs have a unique perspective on the issues involved, the FVS Executive Committee, in conjunction with the Institute for the Advancement of the American Legal System at the University of Denver, surveyed FVS Section members, many of whom are frequently retained as expert consultants or testifying witnesses in civil litigation. Based on the survey findings, the executive committee has released a new report, “Another Voice: Financial Experts on Reducing Client Costs in Civil Litigation.”

The report offers stakeholders in the civil justice system--including judges, attorneys, financial experts and clients--five recommendations to enhance the effectiveness of financial experts and efficiency of their use in the civil pretrial process:

What Can CPAs do about Tax Identity Theft?

I am constantly getting emails and calls from members who have stories about how one of their clients has become a victim of tax identity theft and the person’s refund has been put “on hold” until the government can sort things out. Some of these stories can be heart wrenching. 

It’s no surprise that these stories are on the rise. Tax identity theft has mushroomed – the IRS identified 1.2 million incidents in 2011, over double the amount from 2010 (440,581) and the numbers may actually be much higher according to a Treasury Inspector General analysis. So, unfortunately, the odds that your clients may be affected have gone up considerably.

Expanding Your CPA Services to the Government

In today’s economic climate, even with budget cuts on the horizon, the U.S. government is the largest consumer in the world. Yet, for many businesses -- small businesses in particular -- the thought of doing business with the federal government can be headache-inducing. Last year, the federal government spent more than $850 million on financial services. Just more than half of this was spent with CPAs; the remaining half was spent on other financial services, including debt collection.

The demand is there, but is it possible for a small CPA firm to capture a portion of this market? While well-established Fortune 500 firms have a definitive advantage in the contracting industry, the federal government has taken steps to level the playing field and create a more small-business-friendly environment. Two examples of this are small business goaling and set-aside contracts. 

4 Pieces of Advice to Help Clients Collect Money Faster

Imagine having more than 1 out of every 3 dollars you’ve earned tied up and inaccessible.

That’s money you can’t use to advertise, to develop new products and services, or to hire employees.

For many business owners, that scenario is a day-to-day reality as they sit with 40 percent or more of their assets tied up in accounts receivable. Obviously, when it comes to money that your clients are owed, they want to collect as quickly as possible.

Accounting Offers More Career Opportunities: If You Know How to Find Them

USA Today recently reported that service businesses are leading an uneven job recovery. In the service sector, accounting firms have regained 87% of the jobs they lost, in part because of the growth of start-up businesses, new financial rules and U.S. companies expanding globally.

Salaries of accounting graduates are continuing to rise. In an April 2012 report on the starting salaries of the college class of 2012, the National Association of Colleges and Employers said the median salary of accounting majors was $47,800, up 2.8% from the 2011 median salary. The overall average salary of new graduates was $42,569, up 4.5% from 2011.

Long term, employment of accountants and auditors is expected to increase 16% from 2010 to 2020, or about as fast as the average for all occupations, according to the Bureau of Labor Statistics. Over that ten-year period, accounting employment is forecasted to increase from 1.22 million to 1.41 million jobs.

These statistics point to continued growth in the job market for CPAs, but where will CPAs find job and career opportunities?

How Do You Tackle Health Care Reform?

One provision at a time, of course!

Everyone is talking about the new Affordable Care Act.  Everyone is reading about it. Everyone is writing about it. Everyone is learning about it. But what is anyone doing about it?   

Not enough is what I am hearing from my fellow CPAs. And that is quite understandable when simply thinking about the magnitude of health care reform can leave you scratching your head. But there is a way to devour the totality of the legislation without feeling completely overwhelmed:  tweak your approach.  Just as the saying goes, “How do you eat an elephant? One bite at a time, of course!” The same holds true for tackling health care reform, you tackle it “one provision at a time.”

Prior to the Supreme Court’s decision on June 28 to uphold the mandate requiring  most U.S. citizens and legal residents to maintain minimum health coverage, many individuals and businesses put off action in case the law was overturned. Now that the results are in, many people are taken aback wondering how to go about implementing the vast array of elements that make up health care reform.

The Importance of Communications in Accounting

Hi! My name is Joseph Farco and I’ve recently completed a summer internship with the AICPA. I assisted the Communications and Media Channels team in the New York office. While working with the AICPA has not only allowed me to learn more about numerous issues facing the profession, it also has helped me develop one of the most important skills for any business professional: communications.

From a young age I always knew I wanted to go into business, because I visited the New York Stock Exchange once a year on Kids’ Day. How was I allowed to go to this event on a yearly basis? Well, my father has worked on the floor of the exchange since 1980. His desire to see me do well in life combined with my annual visits to the NYSE, fueled my fire to go into business. This led me to mostly business electives in high school which included two college level accounting classes. I was surprised with how much I enjoyed those classes and I became interested in learning more about accounting. My passion for mathematics led me to embark on a journey to Seton Hall University, where I graduated in May 2012 with a BS in Accounting. My future plans are to pursue an MBA in Finance and eventually sit for the CPA Exam. My long term goal is to one day open up my own practice.

While the focus of my internship has not been entirely on accounting work, I’ve learned a number of lessons that could be used on a daily basis in the “real world.”

4 Social Media Etiquette Tips for CPAs

If you have had your business for any length of time, you know the importance of using the Internet for promotion. Even if you work for a financial firm, you may be called upon to participate in the online promotion of initiatives for the corporation. One of the easiest ways to do this is by using social media sites like Facebook, Twitter and LinkedIn. These sites offer ways to widen your customer base, network with other professionals and communicate easily on forums that people already use on a wide scale anyway.

Many people have separate social media accounts for personal and professional use, and making the distinction between the two is key to establishing a professional online reputation. Understanding the rules that apply to personal and professional realms is vital to making the most of social media outlets in both respects.

Here are a few suggestions on etiquette when it comes to social media ventures.

Interview: Tax Aspects of Donating a Car to Charity

While donating a car to a charity can get you a nice deduction, it can be complicated and confusing. Kars4Kids, a national car donation charity, interviewed Jerry Love, CPA, who has extensive experience consulting clients on donating cars to charities. This is a summary of the interview; the full interview can be found on AICPA.org.

Kars4Kids: How important is it for a donor to document the donation?

JL: The Internal Revenue Service has gotten very strict recently and will disallow deductions or impose fines if a vehicle donation is not documented properly.

Kars4Kids: What is the proper documentation that donors should get from the charity?

SOC Engagements: How to Get in the Game

As with so many issues related to the accounting profession, opportunities to engage new clients or re-engage existing clients abound when standards are updated or changed. Such is the case with Service Organization Control Reports ^SM. The guidance for service auditors in the old Statement on Auditing Standards No. 70, or SAS 70, as it was known, was replaced effective June 15, 2011, by Statement of Standards for Attestation Engagement No. 16, which can give your firm and its clients a new set of standards to meet user needs.

If you haven’t already looked into this growing market for CPA services, here are some tips on how you can start a SOC practice:

International Banking Rules Making Their Way into U.S.

After the financial crisis of the late 2000s, the global public’s view of the banking sector took a severe hit.  This sparked a need to finalize the revisions to the Basel Accord (Basel II) in order to restore confidence in the banking system and gain the general public’s trust. One way of accomplishing this goal is by requiring banks to maintain strong capital positions to be able to withstand any future market shock.   On June 7, the U.S. Federal Reserve issued the Basel III documents for public comment.

If you have regulatory reporting responsibility over banks, you should assess the proposals to understand how your or your client’s daily operations could be affected. The Federal Reserve has posted a Q&A on its website to discuss the specifics of Basel III. Each of the three proposed rulemakings is discussed below. Banking organizations that are not active internationally or are not subject to the market risk rules only need to review the first two notices of proposed rulemakings.

CPAs Can Help Americans Plan for a Secure Retirement

A recent CPA Letter Daily Poll recently asked the question, “What would make you cash in your 401(k) before retirement?” and an astounding 42% said nothing.  It’s not that they didn’t answer the question asked, because they did answer it, only their answer was “nothing.” Nothing would ever make them cash in their retirement savings before retirement. People are beginning to realize that you might need to struggle a little more today so that you do not have to struggle in your later years.

Of the remaining 58% respondents to the poll, 47% would use their 401(k) funds prematurely to supplement cash flow because of a loss of employment or to pay their mortgage.  Both of these choices fall into the category of providing cash for the needed expenses in life, certainly understandable.  The CPA Letter Daily is distributed predominantly to CPAs and I’m sure the respondents were also CPAs who have a current 401(k) plan balance.  What is the average worker in the U.S. doing to save for retirement?

Whatever November Brings, Start Preparing Clients Now

There will be some significant potential consequences on the horizon if Congress allows certain existing tax laws to expire on January 1, 2013. With only a few months left to plan, it’s time for CPAs to be aggressive in educating clients about the decisions they may face.

Several tax changes are now set to occur at the beginning of 2013 if Congress does not act. Among them:

• Individual income tax rates will go up.
• Long-term capital gains rates will rise.
• The gift and estate tax exemption will drop from $5.12 million to $1 million. Estate assets more than the $1 million exemption will be taxed at a maximum 55% rate.
• Taxpayers whose income exceeds a set “threshold amount” will be subject to a 3.8% Medicare surtax on net investment income, effectively raising their marginal income tax rate. An affected taxpayer in the 39.6% bracket—the highest bracket in 2013—will have a 43.4% marginal rate. This will apply to individuals and trusts and estates.

Majority Don’t Expect to Retire at 65

A recent poll conducted by CPA Letter Daily asked the question, “Do you think you will continue to work past 65?”  Coincidentally, the number 65 came up again. 

• Yes – 64.8%
• No – 29.31%
• I don’t know – 5.89%

Approximately 65 percent of the respondents said they would be working beyond age 65.  Do that many people love what they do for a living or is there something else happening?

The Brand YOU: Your Bio

Personal branding is about promoting what makes you unique and what allows you to stand out from the crowd. A major piece of branding is creating your professional “bio” or biography. That bio is, after all, a specific place to capture your “story” …. so it is personal.  

For many CPAs, your bio is likely already on the web and accessible by anyone and anywhere. Since it is so accessible, it presents a nice branding opportunity – to spread your message about the value you provide and the opportunities you want to attract.

When reviewing your bio, consider three Cs of personal branding – Compelling, Consistent and Clear:

Maximo Mukelabai’s Legacy Paves Way for Future Leaders

Last summer, the CPA profession lost a young champion, a dedicated volunteer and a tenacious leader—Maximo Mukelabai. Only 36, Maximo passed away unexpectedly, leaving behind two young daughters and a loving wife. Maximo was passionate about being a CPA. In fact, his enthusiasm for and devotion to his work, led him to become the youngest professional and first African-American to chair the NCACPA’s board of directors.

What is the Right Penalty to Combat Preparer Fraud?

The day after she gets her W-2s, my aunt arrives at my doorstep with her tax documents and an apology (I’ll explain that part later). It all started years ago when she got a notice saying she owed the Internal Revenue Service money. When my aunt signed her return, she was due a refund, so she couldn’t understand how the IRS was now saying that she could possibly owe anything at all.

The Future of Broker-Dealer Audits

The AICPA has a long history of advocacy on behalf of the public interest, including investors and the markets. Our advocacy regarding the regulation of the auditors of broker-dealers is a good case in point.

Under the Dodd-Frank Act, the Public Company Accounting Oversight Board was given the authority to conduct inspections of auditors of broker-dealers.  The AICPA has strongly supported inspection of auditors of broker-dealers that clear, carry and have custody of client funds, given the serious consequences for investors and markets when fraud occurs at these entities. The Institute does not believe, however, that PCAOB registration and inspection should apply to the auditors of introducing or non-carrying broker-dealers, who have no or very limited access to client funds and, as a result, do not pose the kind of risk to investors or the markets that would warrant PCAOB oversight.

3 Tips for Opening the Doors to Future Leaders

As we celebrate National Women’s History Month, CPAs can take pride in knowing that women have maintained a solid foothold in the profession since the early 1980s. Not only that, women have represented half of all accounting undergraduate and graduate students since the early 1990s. Men and women share credit for opening the doors of the profession to ensure that all top talent can enter and thrive. However, there is one place where the numbers are still skewed male: at the partner level in CPA firms. One goal of the AICPA Women’s Initiatives Executive Committee is to call attention to this issue and offer solutions to firms and professionals on why and how to drive change.

Election Year Politics and Worker Classification Issues

We are in the midst of a presidential election year, and the issue of worker classification has surfaced as a labor and tax policy issue, as it normally does.  At a January 20, 2012, small business tax roundtable held by Tax Analysts, Reggie Oldak, one of the senior counsels for the National Women’s Law Center, criticized the “20 common law factors” test (used in defining who is an independent contractor or an employee) as rigged against the worker. She went on to complain that “the IRS is prevented from really devoting the energy it needs to proper [worker] classification.”  In her opinion, employers have the upper hand in employment status matters and independent contractors have no workplace protections.