162 posts categorized "Guest Blogger" Feed

Want an Accounting Internship? 4 Steps to Remember

Internship-interviewAs public accounting is a competitive industry, CPA firms have the luxury of being selective and only hiring the best and brightest. Many firms host early identification programs, which typically take place in the summer and are geared toward freshman, sophomore and junior accounting majors working toward 150 credits. Most firms call them “leadership programs.” These programs typically last one to three days and serve to build relationships early with the top students and hire as interns and then into full-time hires.

So, how can students participate? 

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How to Be a Collaborator

Indira Gandhi is elected as the first female P...Indira Gandhi is elected as the first female Prime Minister of India (Photo credit: Wikipedia)

Indira Gandhi once said, “I suppose that leadership at one time meant muscle; but today it means getting along with people.”

Despite being the first female Prime Minister of India and an extremely influential figure in world history, those close to Gandhi say she felt uncomfortable around educated people because of her own lack of schooling. Despite her persona as a commander, she constantly had to pull from her inner strength and circle of confidants to establish herself outwardly as a leader.

What I draw from this is that leadership and role-modeling in any situation means action, not position. How friends, colleagues, and others perceive us should be centered in our ability to gather the appropriate input to make sound decisions, rather than our need to rely on where we fall in the relationship. However, because of the role modeling we’ve experienced and become conditioned to throughout our lives, many of us think we have to emulate the role of the leader—always decisive and always in control.

If I’m not perceived as a leader and enter into a collaborative situation, I may come across as weak. While that may be the general belief, is it accurate?

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Finding Plain English Answers on Employee Benefit Plan Audits

If you are a CPA who audits employee benefit plans, you understand how complex they can be. You know how critical it is to make certain that you and your staff have all of the knowledge and resources you need to perform quality audits in this area. Luckily, the AICPA has several resources available to assist members in performing EBP audits.

One such resource is the Center for Plain English Accounting. I am the director of the newly launched CPEA, the AICPA’s national A&A resource center for Private Companies Practice Section member firms. Members can submit written questions to the CPEA and receive written responses and gain access to reports, alerts and webinars on A&A topics including EBP, revenue recognition and Private Company Council accounting alternatives. Watch the video below for more information on CPEA.

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5 Advantages of Completing the National MAP Survey

Survey-groupI often meet CPAs who are committed to enhancing their practices but are missing crucial intelligence that would allow them to benchmark their results against those of similar firms. If you could use thorough and meaningful data on how you compare with the competition, but you’re not sure how to get it, the AICPA PCPS/TSCPA National MAP Survey is your answer. The profession’s premier benchmarking study, which remains in the field until July 31, the National MAP Survey, offers participating CPAs a comprehensive platform to perform a personalized diagnostic review of their firm every two years, deriving important takeaways. The new dynamic reporting options make it easy to download reports in a variety of modes, including Excel, PowerPoint and PDF files, based on each firm’s needs.

Here are five reasons to participate:

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7 Keys to a Successful Blog

TypingWe’re halfway through the year and while there are many areas you can focus on to further develop your CPA practice, now is a great time to think about how you’re marketing your firm. It’s natural to think that effective marketing requires a commitment of extensive resources, but that isn’t necessarily true. A corporate blog is a marketing vehicle that can be managed by your existing staff.

A blog offers many opportunities: it allows you to demonstrate the expertise of you and your staff; it lets you showcase your values as a firm and convey your firm’s personality so you can attract the “right” clients; it allows you to answer frequently- asked questions and introduce potential clients to your staff. Another big advantage of blogging is that it can help your firm rank higher in search engine results.

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Bitcoin: Mystery Currency or Real Money?

Bitcoin Wallpaper (2560x1600)

No matter what you might have heard about the risks and long-term value of bitcoin, chances are good that your clients and employers will want to know more about how the adoption and use of digital currencies as a means of commerce may affect the way they do business.

Although bitcoin is still very much in its infancy, its impact should not be underestimated or ignored just because it is new and somewhat mysterious. Described by bitcoin.org as “a consensus network that enables a new payment system and a completely digital money,” bitcoin is not the only digital currency in today’s market. In fact, according to Coinmarketcap.com, there are 303 digital currencies in at least 637 markets, with trendy names such as “Litecoin,” and “Darkcoin.”

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Staying Ahead of the ATRA and NIIT Curve

Financial-planning-consultationDue to the American Taxpayer Relief Act of 2012 and the net investment income tax, many clients have no doubt experienced the impact of the new multi-layered tax environment. According to a panel of leading CPA financial planners, clients ranging from those with high net worth to those with middle income were shocked to be hit with the NIIT and higher tax rates this tax season, and have been receptive to proactive planning to mitigate in future years.

Consequently, 2014 is the year to sit down with your clients and provide proactive guidance, education, planning and expertise. Here are a few helpful tips from our panel of experts to help you do that.

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Time to Clean House with Asset Retirement

TimeRegardless of the size of your business, somebody should be responsible for maintaining your company's fixed asset or depreciation schedule. Since in most cases this is not a full-time job, it may be neglected. Updating accounting records is unavoidable for most of us. However, many of us are incredibly busy. Who has time to pull out a fixed asset list - just to make an addition? If your company is large enough to employ an asset manager, you may be up to speed with fixed assets. If not, who is responsible for managing this schedule and do they have the information they need? New tax regulations that went into effect Jan. 1 allow organizations to go back and write off those assets on the books that are long gone. The regulations even allow for partial dispositions of "units of property" that previously were not permitted.

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12 Revenue Recognition Concerns

BridgeMany preparers and practitioners have been anxiously awaiting the new, converged revenue recognition standard for quite some time. The standard was released by the Financial Accounting Standards Board and the International Accounting Standards Board on May 28. How can we prepare for a smooth transition to the new standard? What major changes will we encounter as we begin implementing it? The new standard is principle-based, which is a big shift from the industry-specific guidance we have today. In preparation for this change in approach, the AICPA has established 16 industry task forces which are developing a new accounting guide containing helpful tips and illustrative examples for applying the new revenue recognition standard.

As the co-chairs of the Construction Contractors Revenue Recognition Task Force, we have been thinking about our major implementation issues for a while now. Here are our top 12 concerns so far.

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Time to Change the De Minimis Amount for Tangible Property?

FeedbackSince the release of the final tangible property regulations, practitioners and taxpayers have shared numerous concerns about their complexity and administrative burden.  One of the most common complaints is the de minimis safe harbor election. 

The de minimis safe harbor provision, if elected, allows a taxpayer to immediately deduct amounts paid to acquire, produce or improve tangible property and gives the taxpayer additional protection from future Internal Revenue Service examination adjustments.  The safe harbor provision has two separate thresholds ($500 for taxpayers without an applicable financial statement and $5,000 for taxpayers with an AFS).  A certified audited financial statement is considered an AFS but reviewed or compiled financial statements are not.    

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4 Tips for Young CPAs to Maximize Networking Opportunities

“What do you want to be when you grow up?”

Build-a-networkIf you’re like me, the answer to that question has changed over the years. I’ve answered everything from “shortstop for the Kansas City Royals” to “managing partner of a CPA firm,” and everything in between—and there is a lot in between. But, whatever your career aspirations are, no matter what position you hope to have, or what industry you hope to be in when you retire, you will need people to help you get there.

People who turn lofty dreams and career aspirations into reality almost always have one thing in common: a tremendous network of people. How do you develop this network when you’re a young professional? Where do you begin? It seems daunting to think of going from the seemingly insignificant network you graduated with to the “who’s who” list that some partners at your firm carry with them. While you could go to every one of the grip-and-grin networking happy hours offered every month, how effective is that? Is that really the kind of interaction you’re seeking?

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Taking the Leap Toward Sustainability

Wind-farmIs the United States somewhat behind the rest of the world when it comes to embracing sustainability practices and reporting? Some seem to think so.  However, a shift has occurred over the last couple of years as companies are beginning to recognize that sustainable business practices are simply good for business. This point was made in a conversation between Susan Coffey, AICPA Senior Vice President, Public Practice and Global Alliances, and Jessica Fries, Executive Chairman and Board Director of the Prince of Wales Accounting for Sustainability Project, also known as A4S. Many companies around the world are beginning to take notice of risks within their business models, such as their reliance on non-renewable forms of energy or their excessive water consumption, and are working toward replacing these practices with sustainable solutions.

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11 Easy Ways to Build Good Client Relationships

HandshakeIt is important that we, as CPAs and trusted advisers, work on creating long-term relationships with clients at every opportunity. We cannot forget that public accounting has and always will be a people business. While it has a little bit to do with number crunching, most clients want to hire and retain a professional they trust and respect.

That includes you. Whether it is your first year as a CPA or you are a seasoned senior CPA, you are making direct contact with clients on a more frequent basis than many of your managers, directors and partners. As a result, your daily interactions with clients should not just be about getting the answers you need to complete your work papers. Instead, your client interactions should include a conscious effort to build credibility and a personal relationship.

Here is a collection of easy things you can do to start building positive relationships with new and existing clients.

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Decoding the Gray Areas

Ethics-moral-principlesSuppose you are the owner of a convenience store. You purchase newspapers at a fair wholesale price from a man named Harry. Each morning Harry delivers a stack of newspapers to your shop by 6:30 a.m., prior to the morning rush.

At 6:00 a.m. one morning you are walking in your neighborhood and see Harry taking a stack of newspapers from a corner.  Harry places the papers in his backpack and continues on his way.

Soon after, Harry arrives at your shop to make his usual delivery. Should you continue your business with him now that you have observed him taking those newspapers?

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3 Tax Planning Tips for Parents-to-Be

BabyMy husband and I, both CPAs, are expecting a baby boy in August. Of course, being the fun-loving accountants that we are, as soon as we found out about the good news, we started thinking about tax planning for our new addition. Names, nursery theme, telling our family about the good news – those items could wait.  But, tax planning, that was a today item.

I’ve been fortunate to work with many clients with children in my public accounting days, so I knew the general tax items that we needed to think about, such as tax credits, flexible spending accounts, household employee/nanny rules, etc.  However, I wanted to refresh myself on these items and share some insights with anyone who has or will have a family. Here are some tips for you parents-to-be:

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Beyond the Tax Return: Transition to Trusted Adviser

Trusted-adviserIs this a scenario you could relate to during busy season? It’s one of those days. Your schedule is jam packed. You’re working in overdrive to get it all done. The next thing you know, the receptionist buzzes you with news that one of your clients is in the lobby to drop off some paperwork. They would like to see you if you have a few minutes.

“ARGGHHH…not today!” you’re thinking. “I just don’t have time.” As tempting as it would be to decline the last minute request, you’re mindful that a client is right there in your office. That means you have the opportunity to amp your trust factor while they’re visiting. Maintaining a hands-off approach can make client retention tough. In my practice, the biggest complaint we hear from prospective clients who are considering a new firm is that their current tax expert never talks to them.

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10 Years in the Making: The New Revenue Recognition Standard

It’s here! The new revenue recognition standard, that is. I believe it is the most pervasive and across-the-board important topic that the Financial Accounting Standards Board and the International Accounting Standards Board could have tackled. This new standard eliminates the transaction and industry-specific guidance found in current U.S. GAAP and replaces it with a principle-based approach. Also, it applies to all public, private and not-for-profit entities. I implore you, no matter what your professional discipline, to pay attention to this new standard.  And please, don’t get comfortable because the effective dates seem far off.

Are you sure the final words in the new standard are consistent with what you have been hearing to date about this project? Are you comforted in having specific revenue recognition rules replaced by a more principle-based approach?  Are you confident that unwritten industry norms of accounting practice formed over decades are consistent with the new standard? In this video, AICPA Senior Technical Manager for Accounting Standards Kim Kushmerick provides an overview of the standard, in addition to highlighting key items to consider and helpful AICPA resources.  

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Crowdfunding’s Impact on the Finance Sector

Crowdfunding-intlCrowdfunding is a popular but complex term. To some, it refers to a large campaign to raise money for charity. To others, it involves pre-ordering products that will be financed by the received contributions. Another form is equity crowdfunding, also known as crowd investing.

The concept of crowdfunding is not new. For hundreds of years, similar local models included citizens of a village or town have coming together to fund a project. These days the Internet makes it possible to operate similar models on a larger scale. It is an effective, transparent and democratic model to raise financing.

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Celebrate Memorial Day by Giving Back

Memorial-dayMany service men and women encounter challenges upon returning from active duty, including finding employment. Starting a business is an attractive option, but like many entrepreneurs, veterans need support. The good news is that CPAs are in a great position to offer help.

Thanks to the Veteran Fast Launch Initiative, U.S. veterans have the opportunity to gain free help from experts. Through AICPA’s partnership with SCORE, an organization that provides mentoring and training to entrepreneurs, this program connects veterans with CPAs across the country. CPA volunteers provide up to five hours of free financial advice to veterans on starting and growing a business.

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Money Matters for Mothers and Daughters Alike

Triumphant-womanThis Sunday is Mother’s Day. While many mothers may be treated to flowers and breakfast in bed, it’s also a day to celebrate the strength that comes with being a mother. But sometimes, that strength can waiver when it comes to finances. 

"Be Prepared, Not Scared" is what I have been telling my clients for years. This is especially important for female clients. According to a 2012-13 Prudential Research Study on the financial experience and behaviors among women, only 22 percent of women feel “very well equipped” to make wise financial decisions. A likely reason for this is that, in male-female relationships, most often the “chore” of planning is handled by the husband. My goal is to change that. While most of my married clients are men, we push to get wives involved at the earliest point in their personal financial planning engagement.

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A Business Model with No Managers? Yes, it Works

Lone-businessmanThere’s a lot of talk within public accounting about altering the existing business model to adapt to a changing marketplace and the evolving needs of our clients and staff. At my six-person firm, we decided to take a leap into the future by completely rethinking our business model. In July 2012, we went from a traditional firm—one with an office and a hierarchy—to a digital practice where there are no managers. Virtual means a lot of things to different people, and for us it meant closing our doors on our traditional office location. We tried it as an experiment beforehand, and it worked so well we decided to switch completely.

At the same time, we also instituted a Results Only Work Environment, in which we rate performance, not attendance. For us, that also meant doing away with the management structure. I lead the firm and set our future direction, but I don’t know what anyone is doing throughout the day. In fact, no one oversees what our team members do all day—or tracks their vacations or time off--as long as they achieve the required results for the firm.

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A Strong Professional Network is an Invaluable Resource

NetworkingMany people think of networking as either schmoozing or as a purely social activity. In reality, a strong professional network is an important resource for an up-and-coming CPA. A strong network is diverse and includes clients/customers, peers, senior professionals, business partners and vendors. A strong network helps to build us as professionals and provide better solutions to the organizations we serve.

Just imagine if everyone you had in your network were just like you. How would you find the variety of insights you need to deal with complex issues? We need more varied perspectives and knowledge to make better decisions.

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IRS E-Services: Where are We Now? And Where are We Going?

QuestionsAs the staff liaison for the AICPA’s Internal Revenue Service Advocacy and Relations volunteer committee, I am in the unique position to listen to our members’ concerns and discuss those issues with the IRS.  When the online e-services of Power of Attorney and Electronic Account Resolution were terminated on Sept. 2, I heard concerns from numerous practitioners.  In fact, we received more calls regarding this issue than all other issues combined last year. 

The AICPA adamantly voiced members’ frustrations and concerns to the IRS.  The backlash the IRS felt from the AICPA and other members of the practitioner community was so severe that IRS officials made it clear they never wanted this situation to repeat itself.  This was a top priority to then-Acting Commissioner Danny Werfel.  The IRS also quietly looked into different possibilities to bring back these online e-services.

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3 Tips to Find Your Professional True North

CompassFinding your professional true north, a path you can be passionate about and one that will provide you with direction in the future, is attainable – when you have the right navigation. Whether it is honing your personal skill set, positioning your practice for growth or transforming your organization’s technology infrastructure, it is important that you be the navigator. There are endless possibilities to explore, pursue, master and achieve, and it is important you arrive exactly where you want to go.

Keep in mind that finding your way often means asking for directions and talking with others who have already arrived at your desired destination. They can tell you what is not on the map and the best roads to follow to enhance the quality of your journey. Here are three quick tips to find your professional true north:

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Tax Planning is a Critical Factor in Financial Planning

Financial-planning-consultationCongratulations on making it through another tax season! From those long hours, including rigorous reviews and meetings with clients, you’ve gained unique insight into their lives—insight into their incomes, spending habits, investments and life events. Income tax planning and estate planning elements have become a more critical part of overall personal financial planning with the enactment of the American Taxpayer Relief Act of 2012 and the Net Investment Income Tax. While reviewing those 1040s, you are able to envision potential tax impacts of financial decisions and begin considering tax planning strategies for your clients, which broadens your relationship. This is a great first step in helping them meet their overall financial planning needs, including making estate, retirement, investment and risk management planning decisions to move them toward their long term goals.

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Volunteer This Financial Capability Month

Volunteer-april
April is National Financial Capability Month, an annual event designed to help Americans improve their understanding of finances. As a CPA, you can significantly increase its value and impact, and help ensure the month is more than just a reminder to consumers to save and spend wisely. When you get involved, you can:

  • Help Americans build their financial understanding and capabilities
  • Strengthen and advance the CPA profession
  • Give young CPAs an opportunity to develop leadership skills
  • Volunteer and build your network at the same time

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4 Steps to Conquer the Difficult Assignment

Busy-businessmanYou have just been handed the project. You know the one – the assignment no one else wanted, and even though you thought you were flying under the radar, the project still landed in your lap. Now what?

You have two options: run away from your boss’s office or face the project head on—and come away a victor. It’s up to you.

Don’t Daunt It, Flaunt It

I think we all face the “dreaded project” at some point or another in our careers, probably on more than one occasion. It can be particularly daunting as a young CPA to get an assignment that’s outside what you consider your realm of expertise, and sometimes, you just can’t say “no.” Yet, to think you will come out of the experience unscathed might not be realistic. Nevertheless, it’s my experience that you will learn and become empowered for the next big challenge.

Here are a few tips to help you handle the difficult assignment—and conquer it:

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The Many Advantages of Defining Your Firm’s Value

Business-meeting

It all began when I did some research on how our firm members could better understand their worth and confidently present their value to clients and others. We settled on an approach in which participants answer questions about who they are, what they do, how and why they do it, what sets them apart and why clients should do business with them. You’d be surprised at how much you can learn by really considering the answers to such seemingly simple questions.

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3 Succession Planning Tips from Comedy’s Best

The AICPA hears a lot from CPA firms that are in need of a succession plan, and challenged by acquiring new talent or engaging the next generation of staff. In figuring out how to leave their firm in good hands, I think the profession can learn many lessons from today’s comedy leaders like Lorne Michaels of NBC’s Saturday Night Live, Jon Stewart of Comedy Central’s The Daily Show and Harold Ramis, as Bill Sheridan pointed out in his Feb. 26 post on CPA Success. They’re working a smart succession planning model. They each gather together a group of gifted staff and give them the opportunity to develop their strengths, making for some very valuable broadcast properties.

Through SNL, Lorne Michaels has nurtured a long list of actors who went on to movie or television stardom after cutting their teeth on the show, including Chevy Chase, Bill Murray, Billy Crystal, Eddie Murphy, Julia Louis-Dreyfus,  Jimmy Fallon, Tina Fey and Amy Poehler. Daily Show alumni Stephen Colbert and John Oliver each have their own shows, and Steve Carrel has had both television and movie hits. A lot of talented people have left each program, but that’s alright because the shows’ successes—and the achievements of their alumni—attract new generations of promising young people who want to come on board.

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Before Your Clients Run to the Cloud, Remember SOC

Service-organization-control-markYou keep hearing about “the cloud.” You have read articles and attended conference sessions encouraging the use of cloud services. It is clear that the cloud is increasingly becoming a part of our business processes and solutions. Your clients are starting to clue in. This is for good reason. The cloud may enable them to reduce costs, better use their resources and perform more efficiently.

As your clients seek cloud services, how are you advising them?

Your clients should understand the importance of Service Organization Control reports. It is essential that they have trust in their cloud service providers and are assured that their information is being protected by the necessary security, availability, processing integrity, confidentiality, privacy controls and/or internal controls over financial reporting.

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A Look Inside the Business of American Indian Gaming

Roulette-wheelAmerican Indian gaming generates an estimated $26.2 billion in annual gaming revenues within the United States. The industry has seen a vast expansion over that last two decades encompassing 237 tribes in 28 states. The economic impact of American Indian gaming has given tribal nations the opportunity to rebuild their infrastructure and strengthen their culture after decades of destructive federal policies.

As an enrolled member of the Prairie Band Potawatomi Nation and chief financial officer/director of finance at Prairie Band Casino & Resort, I know first-hand that tribal nations have been limited with the economic development opportunities that reside within defined reservation boundaries. Therefore, the advent of Class II and Class III gaming operations on reservations presented a real opportunity for tribes to raise capital and strengthen their communities. The Indian Gaming Regulatory Act of 1988 stipulates that a tribal nation must have land in trust status prior to 1988, and complete a state compact with the state that they reside in to conduct Class III Gaming. Further, the state must already be involved in gaming, and in this case any major lottery qualifies a state.

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Data Analysis Expressions: PowerPivot’s Secret Weapon

PowerPivotIn my last blog post, I expounded on the value of Excel 2013’s new feature: PowerPivot. However, this new feature has a secret weapon that makes PowerPivot even more valuable for the power Excel user. DAX is easily the best feature of PowerPivot. DAX stands for Data Analysis Expressions. DAX formulas are created in the PowerPivot window using the xVelocity in-memory analytical engine, which executes DAX code. DAX enables the Excel user to create formulas that consist of more advanced calculations that work on data stored in multiple tables. The use of DAX formulas also supports the creation of self-service business intelligence solutions in Excel.

There are two types of DAX formulas: calculated column and calculated fields (also known as measures). In order to understand DAX formulas and their capabilities you have to understand the term evaluation context. In any DAX formula, the evaluation context is applied first in the formula and then the aggregation takes place on the evaluated context. Context is what makes it possible to perform dynamic analysis with DAX formulas.

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Depletion Deductions for Landowners Receiving Gas Royalties

Natural-gasIt is filing season and landowners receiving natural gas royalty payments may be shocked by their tax liability if they have not been planning with their CPAs. Landowners who sign a lease with a gas company own a royalty interest. When royalty income is received, the landowner is entitled to depletion. Similar to depreciation, depletion is the cost recovery of a natural resource and, in the case of royalty owners, natural gas. It is provided for by IRC §611 and the rules governing it are IRC § 613 and 613A.

The Internal Revenue Service provides for two methods:

  1. Cost depletion - allows the taxpayer a deduction based on the ratio of units sold to the number of units available at the end of the year plus the units sold during the year. 
  2. Percentage depletion - allows the taxpayer a deduction based on the gross income of the gas producing property.

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Value of Mentorship Realized in New CFF Program

MentorshipA wise man once said to seek the advice of people that have been there before you. When employment numbers among forensic accountants are projected to expand at an average rate of 9.6% per year through 2018, the need for CPAs experienced in forensics has never been greater. The AICPA has launched the CFF® Mentor Program to meet the demand of CPAs looking for a formal mentoring program to continue their growth and expand their knowledge within forensic accounting. 

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The Urge to Merge Continues

With 2013 in our rear view mirror, many want to know what the merger and acquisition marketplace will look like in 2014. I have been involved in anywhere from 75 to 100 M&A deals a year over the last 4-5 years, and over 1000 deals since 1990. My firm’s involvement may include deals which we develop ourselves, or deals in which we are brought in to consult upon.

What we’re seeing is a very steady M&A market with potential for growth in the future. With baby boomers gearing up for retirement, the M&A market among CPA firms could certainly heat up and my firm is fielding a number of calls from practitioners looking for guidance.

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PowerPivot: A Game Changer for Excel Pivot Table Users

PowerPivotAs a CPA and a power Excel user, my goal in Excel has always been to create useful reports and analysis for audit documentation as well as to meet my client’s need for information and reports. I quickly discovered that the best tool in Excel to meet my goals was to learn and master the capabilities of pivot tables. Learning pivot tables has increased my efficiency in almost every project that I have worked on and has been the tool I most often turn to in order to complete projects in a timely manner.

As great as pivot tables are they do have limitations, for example pivot tables do not work with data sets larger than one million rows. Pivot tables also can only work on one data set at a time. If I want to create a single report from multiple data sets, I must use V-Lookup formulas. If I want to perform calculations in my pivot table, I must use Calculated Items and Calculated Fields, which are cumbersome to work with and are not well supported by the Microsoft team.

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Is Your Nonpublic Bank (or Credit Union) Considered a Public Entity?

Public-privateMany nonpublic companies have looked to the Financial Accounting Standards Board – through the creation of the Private Company Council – to examine the existing accounting standards and make recommendations for alternative approaches to financial reporting. 

Based on the PCC recommendations, the FASB has now issued two Accounting Standards Updates, one standard provides simplified accounting alternatives for accounting for goodwill, the other for applying hedge accounting to certain plain vanilla interest rate swaps (which is explicitly not available to financial institutions) and have others in the pipeline for release. Financial institutions may want to proceed cautiously before moving forward with adoption of any of the PCC alternatives. 

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Staying Mentally and Physically Motivated during Winter Tax Season

Businessman-yogaHow do we stay motivated to continue to get a full night’s sleep, hydrate and enforce good habits when the pressures of work and the reality of deadlines, client demands and day-to-day fire drills become overwhelming? Long hours of winter busy season don’t allow for extra time to take care of our physical well being. Our daily workouts are replaced with early morning or late night staff meetings. Saturday afternoon pickup basketball games at the YMCA are just a fond memory. The only thing worse than going to work in the dark and coming home in the dark is dealing with the bitter winter weather in between.

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Hidden Traps for Small Employer HRAs in 2014

Surprised-businessLike many small employers with under 50 full-time equivalent employees, I thought my company would be relatively unaffected by the Affordable Care Act. I was surprised to discover that my company Healthcare Reimbursement Arrangement is legal, but is now completely unworkable.

I have offered for several years to full-time employees a standalone HRA for which they get pre-tax reimbursements for out-of-pocket medical expenses and health insurance premiums, up to the annual predetermined dollar limit. HRAs generally fall under Code Section 105(b) and are considered employer self-insured accident or health plans. By design, HRA plans have dollar limits on annual and lifetime benefits provided to participants. However, to be a qualified group health plan in 2014, the plan must provide minimum essential health benefits without annual or lifetime dollar limits. My company’s HRA fails to meet this basic requirement. 

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No Matter What You Call It, Valuation Standards Apply

Business-valuationSince Statement on Standards for Valuation Services No.1 was released in June of 2007, I have received numerous questions about when SSVS No. 1 applies. It is important to note that all AICPA members are required to follow all AICPA standards, and many state boards of accountancy require CPAs to follow AICPA standards as well. 

SSVS No. 1 was promulgated for one reason: To protect the public and the reputation of CPAs. Before SSVS No. 1, both CPAs and non-CPAs would tell their clients the value of their business based on what amounted to a rule of thumb measurement. The client would then rely on that number for tax returns, transactions, employee stock ownership plans and many other purposes, sometimes with negative consequences for their own clients.

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4 Resolutions for Business Solution Implementation Projects

Solution-implementationAt the beginning of a new year, many people create lists of resolutions or goals for the future. Just like you, companies make resolutions, too. Sometimes companies devise intricate ways to monitor and measure results against these goals. Yet, even with these seemingly adequate preparations in place, one continues to hear and read about project failures with nearly 50 percent of enterprise system implementation projects deemed failures. After a poor go-live, there is plenty of finger-pointing, usually at the external implementation and vendor team.  But, from my perspective, there is also a significant amount of blame that should be shared by the user organization.

So as a CPA and consultant, I would like to offer some resolutions for companies to keep when implementing a new computer system or undertaking an upgrade effort. These resolutions are based on an aggregation of observations during my work troubleshooting and resolving problems after the fact, and are not unique to any one client experience but are common to many engagements.  

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A Firm’s Strategy for Offering the FRF for SMEs Framework to Clients

AICPA-FRF-for-SMEsThe firm I work for, RubinBrown, prides itself on supporting small business. Our three offices are in America’s heartland – St. Louis, Kansas City and Denver. As an accountant, auditor and adviser for Main Street, private company financial reporting has always been an important issue to us. So, of course, last June we were excited to see the AICPA release its Financial Reporting Framework for Small- and Medium-Sized Entities. We quickly put in place a strategy to offer FRF for SMEsTM-based financial statement preparation to our clients who do not need GAAP-based financial statements.

For me, seeing what works for others and how they accomplish their goals helps me figure out an efficient and effective path for my own initiatives. If you are interested in expanding your firm’s services and serving your clients by using the FRF for SMEs, you may find our firm’s approach and experiences informative.

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Downton Abbey’s Death Duty Explained

Highclere CastleHighclere Castle (Photo credit: Wikipedia)

Spoiler Alert: This blog post contains spoilers if you have not seen the first episode of season four of “Downton Abbey.”

“Downton Abbey,” the British period drama that takes place in the early 1900s, has made death taxes… fun. If you are not familiar with the show, I will set it up for you. The Crawleys are part of the British aristocracy as the Earl and Countess of Grantham. Robert Crawley is the fifth Earl of Grantham and has only one heir, Matthew Crawley. Matthew is Robert’s third cousin, once removed (at this time in history, women still could not inherit property or title). In season three, Matthew marries Mary, Robert’s daughter, to keep the estate, title and money in Robert’s direct line of descent. Almost immediately after the birth of Matthew and Mary’s son, Matthew dies in a car accident.

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Super Bowl’s Hidden Treasure… the Jock Tax

Super-bowl-hotelAs the focus here in New Jersey switches from “Bridgegate” to “tailgate,” we think about the things that we love best about the Super Bowl. A few of mine include eating wings, drinking beer and, of course, watching those witty commercials. However, as the players gear up to battle the elements this week, one other thing separates this Super Bowl from the others: the proverbial taxman. Many states impose an income tax on nonresidents’ earnings and New Jersey is one of them. To professional athletes, it is known as the “jock tax.” 

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Celebrating a Life of Service

MLK-Day-of-Service“Life's most persistent and urgent question is, 'What are you doing for others?'” – Martin Luther King, Jr.

Today we celebrate Martin Luther King, Jr. Day, a day commemorating the extraordinary work and sacrifice of an incredible man; a day when people across the country strive to answer King’s question by coming together to serve their neighbors and communities. King is best known for his dedication to the advancement of civil rights, and, in his later years, poverty eradication and economic justice.

The MLK Day of Service is part of United We Serve, the President's national call to service initiative, asking Americans from all walks of life to work together to provide solutions to our most pressing national problems.

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Cheater’s High? Let’s Talk About the “Auditor’s High”

According to a recent blog entry on the New York Times’ website, researchers have found that people who cheated, and got away with it, experienced a thrill, self-satisfaction and a sense of superiority. While that sensation was not as strong as the high that rats apparently get from eating Oreo cookies, it illustrates how exciting cheating can be. Take for instance the following:

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How CPAs Can Prepare Clients for Healthcare Reform

Health-care-fileCurrently, there is a massive amount of confusion in the business community and among consumers – the very same people that are CPAs in public accounting’s clients – with the implementation of the Affordable Care Act or Obamacare. Change, of course, creates opportunity, and knowledgeable CPAs can expand their role as trusted advisers by gaining an understanding of the implications of the ACA on businesses and individuals.

The changes in insurance primarily affect two client types: small business and individuals who do not get insurance from their employer. This latter group would include self-employed individuals and their families who do not qualify under the definition of “small business” for purposes of the ACA’s insurance market rules. There are provisions for large employers that go into effect in 2015.

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Women and Leadership: The Path Not Yet Taken

Business-womenWhat are the consequences if organizations aren’t making the most of up to half of their potential talent?  Unfortunately, that’s the case in many firms, according to recent AICPA trends data, which found that the percentage of women in leadership positions in the profession has actually dropped from 23% in 2010 to 19% today. As you can imagine, this trend was a hot topic of conversation at the AICPA Women’s Global Leadership Summit, which was held in Washington D.C. in October. Those who attended the Summit found those statistics particularly troubling because among those present were a number of very talented and vibrant women. If firms and companies are not working to create opportunities for talented women to live up to their full potential, then these organizations are missing out on a lot.

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Volcker Rule Could Affect Community Bank's Year End Bottom Line

English: Paul Volcker, former head of the Fede...Paul Volcker, former head of the Federal Reserve Board . (Photo credit: Wikipedia)

On Dec. 10, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Securities and Exchange Commission released their rule “Prohibitions and Restrictions on Proprietary Trading and Certain Interests in, and Relationships with, Hedge Funds and Private Equity Funds,” otherwise known as the Volcker Rule. This rule has some real implications on the banking industry, including community banks, of which CPAs should be aware.

Under the Volcker rule, ownership interests in covered funds (in other words, investments) will not be permissible and will have to be divested by 2015. Ownership interests in covered funds subject to the Volcker rule include many pooled trust preferred collateralized debt obligations, certain collateralized loan obligations and possibly Real Estate Mortgage Investment Conduits. At this conjuncture, the full scope of investments impacted is unknown.

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Final Tangible Property Rules – A Win for Small Business?

Black-eyed-peaOne of the New Year’s superstitions says that you should eat black-eyed peas for good luck and financial prosperity. If you (or your client) are a business owner who hates black-eyed peas, don’t worry. You got a bit of luck already. In issuing the final tangible property (aka repair) regulations, I believe the IRS went above and beyond to make the final regulations more taxpayer friendly and tried to reduce the administrative burden from the draft regulations. 

When a business buys equipment for their business, it may qualify for an immediate tax savings by expensing the full purchase price instead of depreciating it over its useful lives (e.g., the section 179 deduction and 100% bonus depreciation). However, these options have restrictions. For example, the section 179 deduction requires taxable income and imposes an overall deduction ceiling and the bonus depreciation has a new property requirement (e.g., refurbished assets are not eligible). With well thought out planning, businesses can maximize the tax savings using both options.  

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