6 factors to choose the right basis of accounting for your not-for-profit

AccountingCash, accrual, modified cash or tax—which basis of accounting is best for your not-for-profit? It’s an important decision, so you should consider your options carefully. Management, stakeholders, board members, current and potential grantors, donors and creditors all rely on your financial statements to gain an understanding of your organization’s financial health.

Not-for-profit organizations have several options when choosing a basis of accounting. Here are brief descriptions of your choices:

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Finance pros, meet your new accountability: Cybersecurity

If you’re a finance professional or run a business, you may have a new responsibility these days: cybersecurity oversight. The Association of International Certified Professional Accountants (the Association) recently conducted a survey of financial executives. Seventy-three percent of respondents said their teams are taking on more responsibility for mitigating cybersecurity risks. An additional 15% said they have become the person primarily responsible for cybersecurity.

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5 ways to make the most of your small office space

Small office spaceDo you hit your daily step count just walking around the office looking for a quiet place to call a client? Or do you move files off the chair by your desk so you can talk with a co-worker? There are benefits to working in a small office space, like the camaraderie our office developed eating lunch in the combination kitchen/library/conference room, and any challenges can be offset with some adjustments. Here are some ideas for getting the most out of your limited office space.

  1. Ask before you act:

Is your office a good place for valuable impromptu meetings? Does your staff feel it’s easy to concentrate? Does the lighting throughout your office allow for a good work experience? Is technology easily accessible? The best way to find out is by asking, either in an informal meeting or via a survey. Your plans to get the best use of limited office space won’t work if you don’t solve the problems that prevent staff from doing their best.

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5 tips for an effective not-for-profit board

Board of directorsSurvey says, gaps in not-for-profit board performance fundamentally impact the success of the organization. Problems range from lack of true engagement by board members to their failure to fulfill important fiduciary duties. Do these sound familiar?  Don’t worry. We are here to help you resolve these issues and set your board up to be as efficient as ever.

To avoid these shortcomings, consider the following best practices:

  • Set clear expectations up front. Do your incoming board members have a thorough understanding of what is expected of them? And do they understand what meeting those expectations will involve? Have they met key players and learned about relevant policies and procedures? We recommend developing a comprehensive onboarding process that clearly defines board responsibilities, including the details they need to know to hit the ground running.

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Don’t overlook this important subject with clients

HealthWe’ve all heard the phrase, “Your health is your wealth.” Why then are so many advisers hesitant to talk to their clients about it? Health intersects the planning you provide in many ways, yet practitioners rarely go there. The result is missed opportunities and incomplete planning.

A client of mine suffered a major heart attack and stroke at age 65. In the aftermath, he and his wife resolved to spend his remaining years traveling and gifting the wealth they had amassed. On the surface, their reaction sounded like a generous, intentional plan. Unfortunately, they hadn’t considered that his life expectancy was quite a bit longer than they assumed, even after the scare. In that time, the term insurance he was certain would cover his wife’s living expenses after he was gone would expire.

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The trait that will prevent robots from stealing your job

RobotsLet’s face it. Artificial intelligence (AI) is going to revolutionize our business environment and the profession. Advancements in AI mean that you will soon spend less time conducting time-consuming and repetitive tasks. However, just because a robot can perform certain tasks traditionally performed by a CPA, does not mean that a robot is going to steal your job. That is because humans possess traits vital to our work that robots just don’t have the bandwidth to handle. One of the most essential traits is professional skepticism.

According to the AICPA Professional Standards, professional skepticism is an attitude that includes a questioning mind, being alert to conditions that may indicate possible misstatement due to fraud or error and a critical assessment of audit evidence. It is a necessary trait that all auditors must have, and is expected of all CPAs. Here are six tips to help you enhance your professional skepticism.

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If you’re hacked, what’s your cybersecurity liability?

Cybersecurity liabilityCybersecurity attacks are inevitable. That’s the unfortunate reality. In fact, in a special report, Cybersecurity Ventures projects cybercrime’s global cost will reach $6 trillion by 2021. Now more than ever, organizations and accounting firms of all sizes need to be vigilant about protecting data and responding to threats.

What’s your liability?

That’s a big question we hear from firms regardless of whether or not they’ve been attacked. There are actually no uniform federal laws on business cybersecurity. But there is a patchwork of state rules. Under certain state laws, CPAs can face liability for cybersecurity breaches that expose personal information. Most states have rules for handling breach notifications and for what remediation measures need to be taken. Breach requirements depend on where the client resides – not where your firm is located. We encourage you to learn the dynamic requirements of states that apply to you.

Meanwhile, federal circuit courts are split as to what constitutes sufficient standing to sue in cyber breach cases. Some courts hold that companies may be liable for damages if client or employee data is stolen, even if the theft causes no harm; instead, it’s sufficient to merely allege that the information was compromised. This broad interpretation will only further increase the risk of cyber liability claims.

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Busted: 3 spooky investing myths

Grim reaperGhosts, skeletons and zombies – most of us can agree these are all pretty scary, right? Turns out, when you talk about “investing,” many people have a similar reaction to that of getting spooked in a haunted house.

Instead of running from investments and screaming like a banshee anytime someone mutters the words “stock market,” AICPA’s National CPA Financial Literacy Commission members want to put these investing myths to rest with tips for how to get past them:

Myth #1: I need a lot of money to invest.

False! Sean Stein Smith, CPA, CGMA, says that with the development of investing apps, and the increased number of opportunities to purchase fractional shares of companies, anyone can start investing simply with spare change from credit card transactions. It’s that easy! Employer offered 401(k) programs make it especially easy to invest by deducting straight from each paycheck; the automation means you likely won’t notice the money is gone.

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Beyond tax: Extending your success

Financial planningAs we near the end of October, tax practitioners across the profession collectively breathe a sigh of relief. Another tax season is in the books, and CPAs find themselves ready for a vacation or a change to their tax-centric practices.

We’ve been there, craving balance as another tax deadline passes. In our search for an alternative, we discovered a complement to our tax skills that has reenergized our careers and opened new opportunities for our clients and practice.

If you find yourself in need of more than just a vacation after October 15, here are a few things we’ve learned as we’ve recently transitioned our careers from tax compliance to advising clients on all aspects of their financial lives, including estate planning, retirement planning and beyond.

The benefits to your practice and clients are vast.

If you’ve been in practice for a while, you probably have a roster that includes many long-time clients. Over the years, clients may have approached you for your thoughts on their plans for retirement or the best way to plan their child’s education. If you’ve had these kinds of conversations, you’ve been doing personal financial planning (PFP) without even realizing it. By formalizing your PFP services, clients will benefit from your holistic understanding of their full financial picture, and you’ll improve both your practice and lifestyle by:

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Five movies that (kind of) predicted cybercrimes

HackersEquifax. The Securities and Exchange Commission. Whole Foods. These are just a few of the hacking incidents that have made the news in recent weeks. Although organizations are becoming increasingly concerned about their cybersecurity in the wake of current reports, Hollywood has been warning us for years about the importance of keeping our data safe. The following five movies are not only entertaining, they also acted as a crystal ball of sorts by giving us a glimpse into the possibility of today’s cyber events.

Movie: “The Net” (1995)

Lesson: Your personal data is your most important possession.

“The Net” warns of what can happen when your data falls into the wrong hands. When systems analyst Angela Bennett receives a disk from a colleague, she inadvertently sets off a chain of events that leads to her social security number being reassigned to another name, her home being sold out from under her and an arrest for a litany of crimes she didn’t commit—not to mention the mysterious deaths of people around her who know about the disk.

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The one business mentality all CPAs need

Global mindsetDr. Alia Crum famously says in her Ted Talks, “Change your mindset, change the game.” This philosophy is especially true in how we relate to one another. In today’s evolving marketplace, being a successful businessperson requires the ability to work and engage with people from all over the world and from many different cultures.

Understanding the global mindset

The global mindset is “the ability to relate to and influence individuals and groups whose culture and way of doing business are different from your own.” It’s necessary for anyone who wants to “change their game” and thrive in today’s business environment.

But incorporating this perspective means more than just changing the way you think. It means filling your mind with information that will help you behave in a more culturally sensitive way, making you more effective in both business and community. The global mindset’s three capitals were developed by Thunderbird University, and include:

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CPA life hacks to keep from getting hacked

Hacker 2I love that my bank, credit cards and insurance companies all have intuitive websites and mobile apps where I can easily pay bills and check my balances. But between Whole Foods, Equifax and Yahoo, I – like many other consumers – am becoming increasingly concerned with what organizations are doing to protect sensitive information.

Even as we become more dependent on IT systems for everything from ordering our groceries to tracking our fitness, cyberattacks are becoming more organized, profitable and persistent. For CPAs, this means growing concerns about both protecting client data and helping clients protect sensitive information.

In honor of Cybersecurity Awareness Month, here are three ways CPAs can remain proactive when it comes to cybersecurity.

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The road to retirement starts here

Older couple riding a bikeWhen it comes to saving for retirement, there is no one-size-fits-all plan. Each American has a unique and fluid situation, impacted by a variety of factors. Fortunately, CPA financial planners are well-versed in the different aspects that go into a tailoring a retirement plan that best fits their client’s needs.

I sat down with Leonard Wright, CPA/PFS and member of the AICPA Personal Financial Specialist Credential Committee, to learn some best practices for starting a retirement plan that helps maximize enjoyment during your golden years.

Jonathan Lynch: A recent survey found that less than half of non-retired Americans are confident they will reach their retirement goals. With all the uncertainty surrounding retirement -- where should someone without a plan begin?

Leonard Wright: Before bringing numbers and calculations into retirement planning, simply think about where you want to be when you reach that stage of your life. Ask yourself how you envision enjoying your retirement years. Define exactly what your desired lifestyle will entail. Will you downsize your residence? Do you plan on travelling? Would you consider working part-time? And perhaps most importantly, what age would you like to retire?

Once you have a clear vision in mind, you can start building the plan to make it a reality.

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Money, Money, Money: CPAs’ Salaries Revealed

SalariesIt’s good to be curious, no matter what your cat tells you. CPAs are known for seeking out high-quality information and always wanting to know more. However, when it comes to salaries, EVERYONE is curious. How do you measure up? If you choose one field over another, how will it impact your earning potential? Now, we’ve made that information available at your fingertips.

This week, the Association of International Certified Professional Accountants announced the results of its 2017 salary survey of U.S. CPAs. Nearly 5,600 people responded, answering questions about current salaries, salary expectations, skills and training. A couple key numbers:

  • $119,000: National average annual CPA salary (without bonus)
  • 81%: Percentage of CPAs expecting a raise in 2018

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Celebrating the Teachers Behind the Accountants

World Teachers' Day

Every year on October 5, people come together to celebrate World Teachers’ Day and the powerful difference teachers make. There are many accountants across the globe who wouldn’t be in the positions they’re in now without the influence of a teacher.

To celebrate, we put out a call for responses on social media asking how a teacher impacted a decision to pursue accounting. Here’s what we heard:

Lori Liddell, CPA, ABV, CFE

“To encourage us to stay motivated on our journey to becoming CPAs, Professor Virgil Carr would end his morning greeting by saying, ‘But once you pass that exam, you be sure to let me know and I will greet you as, ‘my fellow accountant’ and will even buy you lunch.’ Telling Professor Carr I had passed the exam and was officially an “accountant” is one of my fondest memories. Although he passed away in 2011 before I ever had the opportunity to take him up on that lunch he owed me, I work each day to make sure others also know the importance of becoming CPAs as well—just as he taught me. So today, on World Teachers’ Day, I salute you, Professor Virgil Carr, and all the other teachers who are encouraging would-be CPAs to continue to the end goal of becoming CPAs.”

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AICPA Finds Accounting Enrollments Remain High

Trends Cover 2017The AICPA recently released the 2017 Trends in the Supply of Accounting Graduates and Demand for Public Accounting Recruits report (Trends report). The report found that the total number of accounting undergraduate and graduate enrollments remains at the record levels seen in the 2014-2015 academic year, totaling more than 250,000 enrollments.  This was driven primarily by an all-time high in undergraduate enrollments. On the demand side, hiring of new accounting graduates has slowed compared to previous years.

This year we saw a shift in the mix of bachelor’s versus master’s enrollments. Projected master’s enrollments have returned to pre-2014 levels, while undergraduate enrollments remained high. The last several Trends reports found a sharp rise in the number of master’s enrollments and graduates. The higher numbers previously reported may be attributed to a surge in both traditional students and those changing careers earning their master’s in accounting. The CPA profession is known to have significantly lower rates of unemployment than the broader economy, particularly during economic downturns.  In my experience as an educator, economic turmoil is a strong motivator for people to seek out the stability that a career in accounting provides.

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4 Great Ways to Lose Talent

RecruitmentFew practitioners would be surprised that CPAs identified staffing as a chief concern in the 2017 PCPS CPA Firm Top Issues Survey. Unfortunately, many firms inadvertently make mistakes that prevent them from keeping their best people or making use of their talents. Outlined below are four mistakes many firms make. This list isn’t meant to be all encompassing, as there’s several other mistakes firms make to push people out the door. Need help? Don’t worry, there’s help in the end.

1. Keep your story to yourself. What’s so great about your firm? If you don’t speak about this with your employees, they may not be aware of the value your practice provides to clients, the firm’s standing in the community or the difference it makes through volunteer or charitable efforts. Instead, recruits and newer staff may only ever receive a fairly generic description of the firm and its offerings. Telling your firm’s story—in a formal program or in informal conversations at staff meetings or one-on-one—can better engage people and enhance their commitment to the practice.

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One Easy Way to Enhance Your Strategic Planning

DominoesIdentifying and responding to risk is a challenging job, since new threats are constantly emerging and old ones can change or unexpectedly reappear. When the Committee of Sponsoring Organizations of the Treadway Commission (COSO) released its comprehensive Enterprise Risk Management: Integrated Framework in 2004, it provided a valuable tool for dealing with organizational threats. In the ensuing years, organizational approaches to risk have advanced and matured, and the nature of risk has steadily evolved.

In response, COSO has released an updated framework to better address the current environment. The new document, Enterprise Risk Management: Integrating with Strategy and Performance, is focused on ensuring that enterprise risk management (ERM) is not simply an agenda item, but something that’s embedded in an organization’s strategic decision making. The new framework is intended to drive changes in setting and implementing organizational strategy in several ways.

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Why I’m #AuditorProud: Auditors Are Protectors

AuditorProud_2017Auditors have always played an important role in society. We validate information that helps citizens understand how towns and school districts manage their tax dollars. We assist small business owners in getting the financing they need to grow. We provide assurance on the information investors use to make decisions on where best to invest for their futures.

And as communities’ needs have grown, so too have the services auditors provide. Below are just three ways auditors have evolved the way they serve the public – and three reasons why I am proud to represent the auditing profession.

Evaluating Risk Management Programs Designed to Protect Sensitive Information

Businesses big and small are faced with cyberattacks every single day. The Equifax breach affected nearly one-third of the US population, while attacks like WannaCry and Petya impacted millions of people worldwide.

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4 Tips for Your New Nonprofit Liquidity Disclosure

ChessAlthough financial professionals serving not-for-profit organizations still have time to prepare for implementation of the Financial Accounting Standards Board’s (FASB’s) new not-for-profit financial reporting standard, it’s important to consider and discuss the impacts of the new guidance with board members.

In June, we published a blog post answering common questions related to implementing the new liquidity disclosures required under the recently-issued not-for-profit financial reporting standard. This post discusses steps for making that implementation process smooth and effective. 

The new standard requires not-for-profits to provide both qualitative and quantitative information about liquidity and availability of resources as follows:

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Don’t Be a One-Hit Wonder

ConcertSafety in shrimp

The first time I heard What’s Up? by 4 Non Blondes, I was elbow-deep in a bucket of raw shrimp. It was a month before I started high school, and I’d been slaving away all summer fileting fish and peeling shrimp in the sweltering kitchen of a local seaside crab shack. It was a thankless job that left my hands both stinging and stinking.

And I loved it.

There was safety in it, I was good at it, and people left me alone – likely because I spent most of my days covered in mullet guts. Regardless, it was just me, my work, and a tiny portable radio that sat atop a nearby refrigerator, softly coughing out Top 40 drivel. But then, it happened. From amid all the pop fluff arose the anti-pop voice of Linda Perry, the 4 Non Blondes frontwoman. She seamlessly went back and forth from a deep, brooding register to an eerily pleasing meadowlark warble.

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Tax Reform and Fairness – A Necessary Balance

Barry

We are fast approaching what many believe is crunch time for tax reform. There is a renewed push by the White House and Congress to enact tax reform by year’s end. President Trump is urging Congress to “move fast,” while the House and Senate work to identify a process to make it possible.

As the debate intensifies, policy goals will be fleshed out, trial balloons will be floated in the media, and key lawmakers will get down to business in assembling a package of reforms to the tax code that can pass muster in both chambers.

A mainstay of the tax reform discussions is a call for cuts in the corporate tax rate. Since the vast majority of U.S. businesses operate as pass-through businesses, tax reform plans have also applied the benefits of lower tax rates to certain pass-throughs. These pass-throughs, including S corporations and partnerships, don’t pay taxes themselves, but pass their earnings through to their owners who pay taxes at their individual rates.

Some in Washington have suggested that professional services pass-throughs – such as accounting firms – should not be treated like other businesses because of the mistaken belief they don’t help drive the economy. We know that’s not the case.

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8 Reasons to Get Excited About Fall

GourdsNow that I’m almost done drying my tears because summer is over (but I’m keeping a few tissues handy just in case), I’m ready to make a confession: I secretly love fall. Anyone who has met me for more than 10 minutes knows I never miss an opportunity to crow about how summer is the perfect season and how anyone who doesn’t like the beach is hardwired wrong. So I kind of feel like a fraud admitting I really like fall. But there’s just something about it that makes me nostalgic.

Here are eight reasons why fall really is fabulous.

  1. Apple picking and cider donuts

The annual family apple picking trips of my youth are magical in my memories—tractor rides into the orchard, farm stands, the discovery of the world’s greatest cider donuts (no really, I’ve never had a better one). The mere thought of it all gets me wistful. Taking my son for the first time (okay, the second time—the first time he was a month old) brought me great joy. This year we introduced our daughter to the apple picking tradition.

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5 Tips for Powerful Financial Storytelling

MicrophonePublic speaking is hard, there’s no doubt about it. You need to prepare your speech, carefully choosing your words and crafting your story. Then, you need to devote some serious time practicing-- some say up to one hour for every minute of your speech! Finally, you need to fight the butterflies in your stomach to step in front of the crowd, steady your voice, and give your speech.

When it comes to public speaking, accountants face more challenges than the average person. Not only do they need to do all of the above, they also need to translate complex data into easy-to-understand concepts for non-finance professionals.

Financial storytelling takes a lot of work, but it’s a learnable skill. The following are tips from the CGMA research brief, “Six Rules to Delivering a Powerful Financial Presentation.”

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9 Facts That Can Make or Break Your Firm’s Future

Grow your practiceThe rules of engagement for business are changing. Today’s world is complex, evolving, extremely high-tech, and fast. Whether you’re a small, one-person shop or a partner at a large or global firm, you’re probably aware that your most valuable current (and potential) clients are unwittingly converting business as we knew it into business-on-the-fly. And they’re bringing new methods that can also prove beneficial to the CPA.

Our societal landscape is significantly different than it was just a decade ago. There are new faces, new modes of interacting, and technology has inarguably and almost completely taken over. Is there a way to sustain and strengthen your practice in this ever-evolving world? Absolutely. In fact, now is an incredibly opportune time for your firm, especially considering the statistics.

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3 Ways to Help Your Firm Showcase Its Value to Clients

Earlier this month, I spoke on Facebook Live with Heather O’Connor from the Association’s Communications team about opportunities firms and small practices have for showcasing their value as strategic advisers.

Many firms today are seeking quality clients who are compatible with the firm’s service offerings. That might sound like a pretty basic statement, but developing a roster of quality clients is anything but basic. Communicating your firm’s value to potential clients should be foremost in your thoughts. For many, the trick is finding a place to start.

But there is good news. Your firm has opportunities to use professional resources and materials provided by the AICPA and enhanced by the new Association of International Certified Professional Accountants. These tools will define and communicate your value, while also helping you attract high-quality clients you’ll retain well into the future.

The first is our #CPApowered campaign. Now in its third year, #CPApowered capitalizes on the strong partnership between the AICPA, firms and state CPA societies to simultaneously reach broader audiences with the objective of promoting CPAs as the trusted adviser to the small business community. Our national campaign includes paid spots on social media and cable television.  Firms can access these high-quality videos for use on their social media channels or websites free of charge.

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Surviving the Equifax Data Breach

HackedOdds are, you or someone you know were impacted by the Equifax data breach. The breach, which is estimated to have impacted 143 million Americans – nearly half the US population – is considered one of largest data breaches in history. Adding insult to financial injury, Equifax has put the onus on consumers to do their own research about whether or not they need to worry.

But don’t panic just yet—we’ve got steps you can take to help protect yourself. Let’s start with the basics:

What is Equifax? And why do they have my information?

Equifax is one of three major U.S. consumer credit agencies, and if you have ever purchased anything of note, like a car or a house, or rented an apartment, or have had any reason to request a credit report, these agencies have your information.

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Tips on Tackling Revenue Recognition Implementation

Shutterstock_112806709“It has been a massive undertaking.”

“There are seven major differences between the old and new guidance.”

“The standard changed the accounting answer for us in a few areas.”

Those are just a few observations from leaders at Oracle regarding their experience implementing the Financial Accounting Standards Board’s landmark accounting standard, Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606). The new guidance supersedes the current guidance in Accounting Standards Update 605, Revenue Recognition. The standard’s initial effective date was deferred, but now it’s almost here. Organizations that haven’t done so already definitely need to take the necessary steps toward compliance ASAP, and firms should advise their clients, too.

To learn more about Oracle’s successful approach to revenue recognition implementation, AICPA Chairman Kimberly Ellison-Taylor, CPA, CGMA, Global Accounting Strategy Director for the Financial and Professional Services Industries for Oracle America, sat down with two colleagues to discuss the company’s experiences preparing to put the standard to work.    

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Why Pets Make the Best Coworkers

Peaches - Julia MorrissMy dog Peaches, a cuddly beagle mix, is the love of my life. As with most pet owners, I spend a lot of time with my dog and miss her when I’m not at home. The days that I telecommute are often the highlight of my week because I can relish her company all day. Having a dog at home is beneficial in many ways:  I stand up and walk around more often, get outside for fresh air a few times a day and feel less stressed because I can give Peaches regular snuggles.

One of the benefits of being a CPA sole practitioner, or working for a firm that utilizes virtual offices, is that you can often work from home, allowing you to be with your pets all day. Some CPA firms even allow employees to bring their dogs to the office.

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Financial Statement Changes: 5 Steps for Nonprofit Boards

NFP boardAs accounting and finance professionals, we’ve been talking about the coming changes to not-for-profit financial statements for some time now. But many others haven’t heard about the changes, including some not-for-profit board members. Board members are responsible for oversight of the financial reporting process, and as such, they’ll want to take an active role during implementation of the new guidance.

The Financial Accounting Standards Board's (FASB) Accounting Standards Update (ASU) No. 2016-14, Not-for-Profit Entities: Presentation of Financial Statements of Not-for-Profit Entities, was issued in August 2016. The standard applies to all not-for-profits and is effective for years beginning after December 15, 2017. Early adoption is permitted.

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The Next Generation: Empowering Future Firm Leaders

Leadership 2“Leadership and learning are indispensable to each other.” –John F. Kennedy

Who represents your future? What’s your professional legacy? How do you know whom to trust with your business when you retire?

Most firm owners know the future of their business relies on the strength of their successors—the individuals most capable of growing and maintaining both client relationships and the service teams within the firm itself. What’s less understood is HOW to identify, nurture and promote the best and brightest candidates in practical terms. What can firm founders and owners do to ensure they’re selecting and preparing the right people to carry on their firms as eventual partners and even owners themselves?

The first task is to recognize the rising stars within your firm. These people are the strongest innovators, always looking for new opportunities to expand client services and grow the business. They’re the ones who naturally lead, and embrace opportunity to build strong teams within their professional circle. And they’re never afraid to assume more responsibility—for not only the daily workings of the firm, but also for the long-term prospects of the business—which includes being personally invested in both client relationships and the firm’s reputation. But once you’ve identified these potential stars, how do you invest in them?

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8 Ways Reading Can Help You Get Ahead at the Office

BookReading is good for your career. Don’t believe me? Think of all the successful people who make reading a priority – Bill Gates, Oprah Winfrey, Mark Cuban, Warren Buffet and Mark Zuckerburg, to name a few. And they aren’t just reading Facebook updates, emails and tweets. They are committing time to reading actual books.

Why does reading a book matter? The benefits are plentiful and aren’t just limited to reading non-fiction. One important way reading helps your career is by helping you develop empathy. When you connect with a character and begin to understand their feelings and emotions, you are increasing your empathy. You gain valuable exposure to other perspectives, which can help you better relate to your coworkers and clients.

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Are You Overlooking Prospective Clients?

Millennial clientsThere is a huge opportunity that most practitioners are ignoring, or worse, dismissing: an untapped client base.

This population doesn’t fit the profile of the typical client. They aren’t in their early 60s, near retirement and don’t fit the typical client profile. They haven’t worked and earned and leaned on you to help them make it to the retirement “finish line,” where they’ll begin to really enjoy the fruits of their labor. In fact, perhaps to the chagrin or confusion of their baby boomer parents, they’re quite different.

As you may have guessed, I’m talking about millennials. Before you tune out, consider the following:

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Help After a Hurricane: Disaster Resources

Hurricane reliefCPAs are no strangers to helping: it is what they do every day for their clients, the public, small businesses and others. As those affected by recent hurricanes or other disasters begin the arduous process of recovery, there are things the CPA community can do to help those living and working in affected areas—including fellow CPAs—get back on their feet. We’ve compiled a list of resources, articles and more to aid in the recovery from this unfortunate disaster.

AICPA Benevolent Fund

If you are facing financial hardship because of a hurricane or other disaster, you can apply for assistance.

Want to help? You can make a charitable contribution to the fund.

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The Firm of the Future: Building Value by Evolving

Firm of the futureWhen starting an accounting practice, it’s important to think about the long-term value of the firm. True forward thinkers might even ponder what their end game looks like; is their goal to merge with another firm or sell their firm? To be succeeded by a partner or family member? In real-world terms, that means thinking about inventive and even unconventional opportunities to expand services beyond the realm of tax preparation, auditing and advice with the goal of appealing to the broadest possible client base. In a world where insurance companies, stock brokers, banks and even franchises like H&R Block are expanding client services to include planning for retirement, education or even simply, how to manage cash flow to maximize financial security, no firm can afford to neglect these areas of their clients’ lives. Competition is becoming too intense.

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16 Work/Life Hacks for CPAs

Life hacksAs a CPA at a small firm, you’re constantly charged with finding the most efficient ways to get everything done and stay organized. From tracking mileage to arranging the supplies on your desk, the following low- and high-tech life hacks can help you make the most of your workday – so you can dedicate more time to what’s going on with your clients and less time to what’s going on with your desk and office space.

  1. Gain an extra monitor through your iPhone or iPad using Duet Display. If you want to increase your productivity with an extra Mac or PC screen, you can multitask by using the Duet Display app, which allows you to use your iDevice as an extra monitor.
  1. Organize cords with toilet paper rolls. Cords that you don’t use on a regular basis can be neatly stored away in empty toilet paper rolls placed in a shoebox.

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Rethink Your Nonprofit’s Chart of Accounts, Part II

NFP Chart of accountsLast month we published the first installment of a two-part series discussing implementation of the new not-for-profit financial reporting model, as viewed through the lens of the entity’s chart of accounts. 

By now, you likely have taken some steps to prepare for implementation of the new not-for-profit financial statement presentation standard:

  • Read through the standard. 
  • Attended training to understand the forthcoming changes. 
  • Had auditor/client discussions regarding the impact on audit timing and planning. 
  • Selected team members to lead implementation of the new standard. 
  • Decided whether to early-adopt. 

When you’re ready to dig in further, the chart of accounts is a smart place to go. The standard will affect several financial statement line items, so it’s important for not-for-profits to create a plan to adjust their chart of accounts during 2017 or 2018.

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Top 3 Millennial Money Woes

Millinneal Finances insightsDo you ever feel like people are constantly saying what you should be doing, without actually telling you how to do it? Same. I bet your clients feel the same way. That’s why I love our Feed the Pig campaign – it’s more like a best friend giving a subtle nudge in the right direction, instead of the typical guilt trip.

To get a better idea of exactly how millennials feel about their finances, we hit the streets to ask the hard-hitting questions that most prefer not to discuss. In doing this, our hope is to help others feel more comfortable discussing their own finances, and provide resources to reach their financial goals.

Here are a few millennial money woes we’ve come across while filming, along with strategies you can share with your clients to help guide them back to the path toward financial success.

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11 Things to Know About Gen Z Workers

Gen ZJust when you thought you were beginning to understand Millennials, it’s time to prepare for Gen Z to enter the workforce and they’re very different from their predecessors. Born between 1994-2010, this generation is known by many names—Post-Millennials, iGeneration, Founders, Plurals, Homeland Generation and Gen Z. Just like the generations before them, the characteristics of Gen Z are shaped by parenting trends, historical events and technology.

Gen Z are the children of Gen X, a cohort that was thought to be skeptical and perhaps even cynical in their youth as they came of age post-Watergate and post-Vietnam. Yet, Gen X has grown up to be balanced and healthy despite facing the strains of the Great Recession of 2008. As parents, Gen X have been concerned about raising their children in a safe environment, which has led Gen Z to be more cautious than previous generations. Other major influences shaping their development and world views include the Great Recession, the War on Terror, the first African American president and the legalization of gay marriage. But, probably the most significant factor is the advent of the smartphone.

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How to Fail in Your Tax Practice

FailMany people are intimidated when meeting with professionals such as doctors, lawyers and CPAs. While CPAs don’t see them undress, their detailed financial situation is laid out and for some can be even more uncomfortable.

So a professional with a good bedside manner (or deskside in this case) has an advantage. The ability to listen, understand, and empathize puts people at ease and forges a bond early in the relationship. The professional may also be inspired to work harder to find the best result. This bond may lead to friendship or at least the feeling of friendship, and who doesn’t need more friends?

 

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Providing Assurance Services in an IA World

Intelligent automationPart I – Control Principles

Intelligent automation (IA) is getting the attention of finance teams, operational environment leaders, and shared service center executives across the world. Not to mention, it makes regular appearances in most major business periodicals.   

Think IBM’s Watson – IA covers all technologies from robotic process automation to artificial intelligence. It is a set of technologies that enables accountants and process owners to configure a software robot to execute, manage, control and audit process tasks. It analyzes data required to manage business and reports on business operations to an experience-based, decision-making software robot.

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AICPA Announces ‘18Q1 Score Release Dates

The Q1 2018 score release dates are posted to the Score Release Timeline page of the AICPA’s CPA Examination page. For complete information regarding scoring, please visit the Examination Scoring and Scoring FAQ pages

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Getting Ready for Assurance Has Its Benefits

Cyber

 

In recent months, sweeping global cyberattacks have taken thousands of businesses offline, compromising valuable data and blocking access to critical services and information assets. If it wasn’t clear before, it is now: cybersecurity is a business imperative with direct implications for overall company value. Prior to this spring, and without a common language or benchmark for cybersecurity, how do you quantify and communicate your cybersecurity risk in a meaningful way?

Enter the AICPA’s cybersecurity risk management reporting framework. Unveiled in April, the framework is intended to standardize the way organizations define their cybersecurity objectives and report against those standards in a format that works for all stakeholders.

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Fighting His Way Out of IRS Penalties. Literally.

BoxingIRS penalties and fees have caused a fair amount of consternation among taxpayers in the past, but in what might be a bout for the record books, we could witness the first time a taxpayer literally fights to pay what they owe and reduce penalties.

Floyd Mayweather, widely regarded as one of boxing’s greatest, apparently owes the IRS unpaid 2015 taxes. The boxer’s recent tax court petition seeking an installment agreement with the IRS might represent his first foray into the super heavyweight category.

Mayweather’s 2015 fight against Manny Pacquiao reportedly earned him as much as $220 million, and likely represents a significant portion of his income to which the taxes are due. The $22 million Mayweather reportedly owes is tiny relative to his estimated net worth, but net worth doesn’t need to be liquid. And as penalties and interest accrue over time, it’s a safe wager the bill could amount to a knock-out blow.

The boxer has requested in his petition that the IRS await payment until his August 26 fight with Conor McGregor, which he claims will provide the liquidity he needs to meet his tax obligation: the fighter’s guaranteed purse from the 2015 Pacquiao fight was $100 million, and his upcoming fight with McGregor is expected to earn him a similar amount. Again, keep in mind, that’s the guaranteed purse—win or lose. The final amount to the winner is a composite of various factors that could boost Mayweather’s take as high as $400 million.

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Tips for Eclipse 2017

EclipseOn Monday, August 21, a total solar eclipse will move across 14 states of the country. The last time this was visible in the United States was on February 26, 1979. The next won’t happen until October of 2023. Given their rarity, it’s understandable why a total eclipse has people excited and even taking time off from work to watch.

Even if you’re not in the path of the total eclipse, you’ll at least be able to see a partial eclipse from most places in the U.S. Below are some tips to prepare for the event and make the most of your experience.

Check what you’ll see in your location.

Take a look at this website prior to the eclipse to see what percentage of the eclipse you’ll be able to view. The website recommends looking at multiple zip codes around you to make sure you get the best view possible. This will also determine if you want to make travel arrangements or stay put.

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3 Tips for Millennials Who Want to Give Back

Almonte David 01As a young accountant who recently passed the Exam, things are going very well for you. You have gotten into a rhythm and you know the ropes. But, you’re looking to make a difference in your community – have you considered volunteering at a nonprofit?

David Almonte, CPA, CGMA and member of the AICPA’s National CPA Financial Literacy Commission, knows the merit of giving back. He was taught from an early age the value of education, a strong work ethic and volunteerism. Additionally, his skills as a CPA have given him the opportunity to make a difference in peoples’ lives. He frequently gives presentations across the country, many of them focusing on his main passion: financial literacy. By providing free and accessible resources from websites like 360finlit.org and feedthepig.org, Almonte hopes to break down the walls that very often lead to financial insecurity.

Like Almonte, you too can use the skills you’ve gained throughout your career to give back. Not sure where to begin? Here are three tips to jumpstart your community service:  

  • Brag a little. You’d be surprised by how many of your talents align with activities you genuinely enjoy. Write down your talents, then research various volunteer opportunities that utilize your skills. For example, are you a pro at creating a résumé, or know exactly how to nail an interview? Oftentimes, local homeless shelters seek out professionals to lead workshops that help clients get back on their feet. Or maybe you love writing – so find a small nonprofit that needs help keeping up its blog. Just as David uses his passion for financial literacy to give back, there are countless other needs in your community. All you have to do is look.

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6 Planning Ideas for Advising Entrepreneurs

Advising entrepreneursIf you work with entrepreneurs or small business owners, you likely have an appreciation of their vision, determination and work ethic.  You may also have run into some common hurdles that can derail their finances.  By focusing on the following planning considerations, CPAs and advisers serving entrepreneurs can keep their clients’ business and personal finances on track.

Choose an appropriate business form

Helping entrepreneurs evaluate key tax and nontax factors when selecting a business entity is not only important to the business’ financial success, but also the owner’s.

Should they operate as an S or C corporation, partnership, limited liability company or sole proprietorship? What are the classes of ownership, special allocations, basis, liability, elections and distributions for each structure and the impact of these factors on the owner? Navigating these complex decisions is crucial to getting their business off on the right foot. If you are an AICPA Personal Financial Planning Section member or CPA/PFS credential holder, see Chapter 18 of The Adviser’s Guide to Financial and Estate Planning for a comprehensive overview of entity selection.

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How Relaxation Can Improve Concentration

RelaxIt’s not surprising that National Relaxation Day (Aug. 15) is observed in the thick of summer because, for many, ideal relaxation involves lounging on a tropical beach and just feeling away from it all. For me, however, snowboarding is a great way to relax. When I’m carving down a beautiful snow-covered mountain, I’m able to allow my concerns to drift off into the background. From these two examples, it’s plain to see that perceptions of what constitutes relaxation vary.

Relaxation does not inherently require us to be inactive or unplugged from our normal routine. Perhaps you make room in your weekly schedule to take a morning run, practice yoga or spend some time in your garden. These activities may be great when we can engage in them, but how can we find other ways to help us relax the rest of the time, which is most often spent at work? One way to find some space and peace, no matter where we are, is through the practice of mindfulness.

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Most Passwords Are Easy to Guess. Do This Instead.

Password2You’re doing your passwords all wrong.

So says the developer of the guidelines most internet users have been following for 15 years, anyway. Passwords that L00K l!ke tHi$ are actually much more susceptible to hacking than most people realize, says Bill Burr, former manager of the National Institute of Standards and Technology (NIST) and author of the NIST’s 2003 recommendations for password management.

In an interview with The Wall Street Journal, Burr said that his previous advice to use numbers, symbols and randomized capitalization resulted in people creating passwords that are easy for computers to predict.

A more secure option is to use four random words, such as “that purple monkey dishwasher.” Such a phrase is actually much more complicated for computers to guess, The Wall Street Journal reports. (Cartoonist Randall Munroe explained the math in a comic six years ago.)

Some password advice remains relevant, however: avoid using birthdays or anniversaries, your kids’ names or your address, as all of this information is easy for hackers to locate. Additionally, use different passwords for each of your accounts and avoid storing them where they can be easily seen or stolen.

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4 Things You Need to Know About Gender Equality

Women in professionFor decades, women and men have been entering the accounting profession in equal numbers. As a result, you might reasonably assume that women are now at or near parity with men at the leadership level. However, that assumption would be wrong. Only 24% of CPA firm partners are women, according to AICPA statistics. Another recent study found that only 17% of audit partners are women. If these qualified professionals aren’t reaching the top levels, firms are clearly missing out on a lot of talent.

The AICPA Women’s Initiatives Executive Committee’s (WIEC) CPA Firm Gender Survey, first distributed in 2015, is designed to identify trends in women’s leadership over time. It informs practical solutions for firms that want to make the most of their talent and prevent the loss of leadership potential. The results provide a unique spotlight on trends related to diversity in leadership and suggest solutions on how best to address them. As we launch the second iteration of the survey this year, I’m reminded of a few of the many valuable insights that the last survey revealed, along with some of the questions firms might want to ask themselves in light of those findings. The lessons learned—and the value and perspective they can offer to CPA firms—underscore the benefits of participating in the survey. Outlined below are a few key takeaways from the inaugural CPA Firm Gender Survey.

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