A Business Case for Women in Your Organization

In my final live blog from the Women's Global Leadership Summit in Washington, D.C., we look at the business of women’s initiatives and the importance of linking your efforts to strategic imperatives for alignment and buy-in. Panelists for this session, "Finding the Right Balance: A Business Case for Women in Your Organization," include:

• Michael Bach, CCDP/AP, founder and CEO, Canadian Institute of Diversity and Inclusion, Canada
• Mary Bennett, MBA, CIA, CEC, chair of AICPA Women’s Initiatives Executive Committee, founder, MLBennett Consulting LLC, Asheville, NC
• Todd R. Mitchell, CPA, CGMA, CEO Solutions LLC, Greer, SC

Mary Bennett is an expert in helping the accounting industry build business-focused initiatives relative to retaining and developing women. She has helped hundreds of firms in the U.S. and Canada to understand their business reasons for investing in these efforts. Male and female partners and managers in these firms come to understand the myths and misperceptions about “women’s initiatives.” They begin to understand where the real business risks are and what their specific scenario indicates in terms of strategy application. (Email subscribers can read the live blog on our website.)

Engage in New Opportunities and Challenges

Kicking off day two of the Women's Global Leadership Summit in Washington, D.C. is Edie Weiner, president of Weiner, Edrich, Brown Inc. The global economy is fundamentally changing and, with it, much of what we have learned about the world we live in. It is difficult to escape from the mental anchors that hold us at bay in yesterday’s world, yet as professionals, women and potential leaders, we have to work on changing our perspectives and becoming engaged in the new opportunities and challenges we face. Join me as I live blog today's keynote session as our resistance to change is exposed and we open up to the world of change that is emerging. (Email subscribers can read the live blog on our website.)

Katty Kay on Womenomics: Women in the Workplace

Katty Kay, Lead Anchor, BBC World News America, and co-author of Womenomics: The Workplace Revolution That Will Change Your Life, is the keynote speaker for day one of the Women's Global Leadership Summit taking place Oct. 24 to 25 in Washington, D.C. I am live blogging from her keynote session, "Womenomics: A New Path to Business Success." (Email subscribers can read the live blog on our website.)

At the 2013 World Economic Forum in Davos, International Monetary Fund Chief Christine Lagarde called the advancement of women the greatest economic opportunity of our time. She is recognizing what Kay calls “womenomics” — the extraordinary value of women in the workforce. Global studies show that companies that employ more senior women make more money. They have more degrees and are ideally suited to the demands of our talent-driven economy. But to keep them in the economy, the workplace must adapt to their needs. Too many women in their mid-30s hit the brick wall of kids vs. career. But we cannot afford to keep losing them. Kay marshals evidence from employers large and small to show how possible it is to satisfy the demands of family and career. Flexible work schedules prove to be a win-win; when companies take the clocks off the wall and choose to measure output instead of input, they see productivity rise by an average of 40%. What starts as talent retention becomes a profit bonus any company would be happy to have. She gives an inspirational boost to women and a practical guide to employers, drawing on her own juggles as the working mother of four children. This presentation provides research- and experience-based advice to companies looking to retain and recruit valuable female employees.

To Match or Not to Match? 1099-K Notices Bewilder Taxpayers

Do you have tax clients who run small businesses or decided to sell their household items on eBay this past year? Or perhaps you are a CPA who accepts credit card payments from your clients? If so, you may have already received a notice from the IRS or should be aware of the latest updates on the IRS push for information matching with Form 1099-Ks (Payment Card and Third Party Network Transactions). Some AICPA members have received 1099-K mismatch notices assessing thousands of dollars in penalties.  

Finding the Silver Lining in Succession

When people talk about succession, they tend to focus on issues such as valuations, buyout amounts, deferred compensation, partnership agreements, the development of new leaders and client retention. Not much is said about the emotional side of succession. Let’s face it: As with any transition, succession hurts. Owners struggle with letting go of the business and the relationships they’ve built,  and the new owners struggle to gain a foothold in their new roles.

Even in a well-planned and executed succession, there are a number of events and circumstances that cause some level of discomfort.  Succession tests the personal and leadership strength of the outgoing owner and, when not recognized, can deflate the excitement of the incoming owners and even threaten their future success. If we acknowledge this side up front, we’ll be better able to set ourselves on a smooth and successful journey. So, what tough challenges should we prepare for on the road to succession?

 

Fall Review of State Legislative and Regulatory Issues: Part 1 of 2

Across the county, state legislatures considered numerous issues that impact the CPA profession.  In Part one of this two-part post, we review legislation that affected CPA mobility, including streamlining military family licensure processes, promoting film tax credits and creating state tax tribunals.  Part two will cover state board reorganizations, sales tax on professional services, new peer review laws and CPAs providing services for marijuana-related businesses.

Currently, 49 states and the District of Columbia have passed individual CPA mobility laws and the remaining U.S. jurisdictions are working toward this goal.  These laws allow CPAs to operate across state lines without obtaining reciprocal licenses in each state in which they practice.  New state legislation is sometimes proposed in a way that can have unintended consequences on the profession’s mobility regime.  This year, there were three particularly noteworthy areas where CPA cross-border practice could have been put in jeopardy.  These included:

1. the easing of occupational licensing requirements for members of the military and their spouses;
2. the creation of film tax incentives requiring audits by in-state CPAs; and
3. the establishment of state tax tribunals wherein CPAs would seek to represent taxpayers.

Integrating Retirement Planning with Your CPA Practice

What do the 77 million baby boomers have in common over the next 15 years? They are all going to face retirement in one form or another. Never before in U.S. history has such a large generation transitioned to retirement with so many years still ahead of them. Are they ready? Can they afford it?  What does it look like? Who will answer these and other questions they have? Who else but the CPA has the financial, economic and analytical education, and ability coupled with the highest ethical standards of placing objectivity and integrity at the forefront of all advice. CPAs have a huge opportunity to expand their practices into the area of retirement planning as the natural progression from guiding their clients through the accumulation years.

In the News: AICPA to Congress: Consolidate Small Business Retirement Plans

The AICPA is gearing up for our Fall Meeting of Council, which begins Oct. 20 in Los Angeles. Be sure to follow @AICPA_JofA and @AICPANews on Twitter and subscribe to the AICPA’s Press Center RSS feed to keep up with all the news and information coming out of the meeting.

In the meantime, I’ve highlighted a few recent accounting articles in the news that you may missed over the last week.

Accounting Today covered the recent written testimony that the AICPA submitted for the record of the House Small Business Committee’s hearing on retirement savings for small employers. In the testimony Jeffrey A. Porter, AICPA Tax Executive Committee chairman, suggested several ways to simplify the complexity of the retirement planning universe.

“When a small business grows and begins to explore options for establishing a retirement plan, the alternatives, and the various rules, can become overwhelming,” he wrote in his testimony.

Finance’s Vital Role in Managing Organizational Risk

“Accountants have a vital role in translating the impact on the financials in three metrics: operating performance, balance sheet strength, and volatility,” said Gregory Case, President and Chief Executive of Aon at a CGMA event held in partnership with the London think tank Tomorrow’s Company. “The whole role of the accounting profession, the language of finance, is absolutely essential and critical.”

According to a recent article in CGMA Magazine, “the aggregate level of risk to businesses is rising at an unprecedented pace. Cybersecurity challenges threaten businesses and even the stock exchanges where value is traded. Social media’s expanding influence can draw attention to risks, crush reputations and cause investors to flee.”

I’m continuously impressed by how CPA, CGMAs are applying their strengths and knowledge to help organizations adapt and embrace innovation. During our visits to large multi-nationals, we learn how the finance teams in highly successful companies are harnessing innovation. In addition, we invited senior executives to share their experiences at events in Asia, Europe and the Americas. Their insights and our research results are captured in the CGMA report, “Managing Innovation: Harnessing the power of finance.”

The American Dream Extends Beyond Our Borders

When I became chairman of the AICPA Board of Directors a year ago, my first blog post addressed several key issues for the profession. But mainly I talked about the accounting profession as a path to the American Dream. That’s my life experience – humble beginnings and following my role-model neighbor who was the first CPA I ever knew. Having represented the United States accounting profession at a Brazilian conference in August, I now fully understand that the American Dream is a universal desire and our profession is a way to achieve it.

10 Risks Facing Nonprofits [LIVE BLOG]

We thought it only fitting that we live blog from our first AICPA Insights Live webcast. Follow along here or on Twitter at #AICPAInsightsLive. The first webcast in this series covers the top ten risk issues that need to be understood and managed, with practical tips and advice on juggling risks while keeping your mission aloft. (Email subscibers can catch up on the coverage on our website.) Don't miss out on the other webcasts in this series and sign up for the bundle today.

Am I “Preparing” Financial Statements?

I meet many members throughout the year at various AICPA conferences and their input is truly valuable. We discuss the issues they are encountering in practice and guidance that would help them. Over the past few years, a common question concerned whether members have “prepared” financial statements for their clients.

Each of their scenarios has provided their own unique set of circumstances and it has been insightful talking through how they make judgments about whether the accountant should follow the reporting requirements for compilation engagements. The AICPA has provided a great deal of guidance on the topic but, with the increased use of cloud applications, the questions just keep coming up and becoming even more complex.

It’s Extension Time! Checklist for Reporting Foreign Assets

As we come to an end of the filing season, keep in mind important foreign information reporting requirements that may affect your client’s income tax return.  On this year’s Form 1040, did you check “yes” that the client has a foreign bank account on Schedule B and list the location of the account? 

How about completing Form 8938 Statement of Specified Foreign Financial Assets?   The purpose of Form 8938 is to report an interest in specified foreign financial assets, which include, but are not limited to:  foreign bank accounts, brokerage accounts, interest in foreign entities and any “foreign financial instrument or contract that has an issuer or counterparty that is not a U.S. person.” Once your client meets certain reporting requirement thresholds, Form 8938 is required.

Here are some last-minute reminders to help you through the Oct. 15 tax deadline: 

Have You Hugged Your CPA Today?

More than sixty-five million Americans are serving as volunteer caregivers for vulnerable loved ones – and as baby-boomers step into senior status, that number will rise. Caregiving for someone with a disability, lengthy illness or aging issues is challenging enough, but adding money concerns to the mix can create a massive strain on individuals and families. Caregivers find themselves thrust into roles they are poorly suited to maintain. Juggling medical, relationship and job-related matters can often pale in the face of the financial pressures of caring for someone who is chronically ill or disabled. 

The key is sustainability – and in order to manage the massive bills, extra costs and nuances of the tax code, I have found that I require the help of a trained professional, specifically a CPA.

Introducing AICPA Insights Live: Weekly Webcast Series

Earlier this year, AICPA Insights turned three years old. Through that time we have explored different ways to provide news and information on hot topics to our readers. One of the more popular methods of sharing information has been our podcasts. This led us to a new feature that we’re pleased to introduce to you this week: AICPA Insights Live.

AICPA Insights Live is a new weekly webcast series, which will occur Fridays at 1 p.m. ET starting Oct. 11. A hot topic that is important to AICPA members and the accounting profession will be covered each session, starting with the top risks facing nonprofits. Currently scheduled topics include year-end tax planning, internal controls and more.

Federal Government Shutdown - It’s Deja vu All Over Again

There’s an old adage that “there’s nothing new under the sun” and so it is inside the Beltway.  As you are well aware, the federal government suspended most of its operations on Oct. 1 after Congress failed to pass a bill to extend funding to mid-November, the first such shutdown in 17 years. Strong political discourse is alive and well in America and it is part of the price we pay for democracy.  It was that way in 1996 when a shutdown lasted three weeks. Hopefully a compromise can be reached quicker this time around.

On the tax front, with more than 85,000 Internal Revenue Service workers now furloughed until Congress reauthorizes spending, many non-essential IRS functions have shut down, including all taxpayer services, as well as examinations. The closure of taxpayer and practitioner hotlines is particularly challenging for those individuals who must file a Form 1040 by Oct. 15 and need to contact the IRS. Nevertheless, no filing deadlines are postponed and returns must be filed. We have urged the IRS to consider the substantial burden imposed on taxpayers (and practitioners) by the inability to communicate with and obtain information from the IRS.

How You Can Manage the Risks of a System Implementation

Managing a system implementation is not an easy task. And if done incorrectly, can cause significant headaches for your business and your customers. There are ways, however, to identify the risks of a system implementation and manage those risks more effectively.

It's fair to say that an organization’s strategic goals drive the systems it implements. However, if those goals and the implementation are not aligned, your organization risks realizing only part of the implementation's expected value, or worse – realizing no value at all. Having other risk factors such as errors in converting or migrating data come to fruition only add to what may already seem like a monumental undertaking.

Updates and Resources from the CPA Exam

There are a few updates being implemented to make the candidate experience more user-friendly when taking the Uniform CPA Examination.

We are adding a comma to the calculator on the CPA Exam. The comma is meant for large numbers such as 1,000 and above to make them easier to read. We are also updating the tutorial to reflect a few recent changes to the CPA Exam, and at the same time we’re updating the technologies we use to present the tutorial.  These changes will make it much easier for candidates to access the tutorial on a variety of hardware platforms. Both the tutorial and comma go into effect Oct. 1.

AICPA Forensic Accounting Credentials Are Attorneys’ Top Choices

Where do attorneys turn when they need to make a compelling case on a critical financial issue? That question can be answered by considering what kind of expert witness they employ. In a recent compilation of accounting expert witnesses who have been mentioned in court opinions or decisions in 2013, the vast majority were CPAs. (Disclaimer: The article was by Ashish Arun with Expert Witness Profiler. AICPA FVS Section Members receive a discount to Expert Witness Profiler, but we were not involved in this study.) Among the 189 accounting experts cited, 166 were CPAs. For those with specialized credentials on top of the CPA, the AICPA’s credentials were clearly preferred over those of other credentialing organizations. The Certified in Financial Forensics credential took the number two spot at 58 experts and the Accredited in Business Valuation credential took number three with 54 testifying experts. The CVA at 31, CFE at 30 and the ASA at 18 were well behind the AICPA credentials on this list.

The Tax Realities of “Breaking Bad”

The final episode of “Breaking Bad” is here. But I don’t want to discuss what happens in the finale or even this season. Instead, I want to focus on the tax implications of what Walter White and his alter ego Heisenberg have done. (SPOILER ALERT: There are no spoilers contained herein from any episodes airing in 2013, but there may be some if you haven’t caught up to the last season).

Tennessee's "crack tax" (struck down as unconstitutional not long after its creation) notwithstanding, the Internal Revenue Service has a history of charging those involved in illegal activities with tax evasion. Al Capone and Soviet Spy Aldrich Ames both were charged with tax evasion after they did not report the money made from their illegal activities. After all, the IRS instructs taxpayers to report any illegal activity income on line 21 of the Form 1040, where other income is reported. So in reality, someone committing crimes and earning revenue for this activity could avoid tax evasion charges by reporting it on line 21. But then of course you've just admitted to conducting illegal activities. While technically confidential between you and the IRS, the common belief is that the IRS will find a way to alert the authorities, either through disclosure in an audit or interdepartmental alliance. So, most people don't report their illegal activities, don't incur tax and go on tax-free until they get caught.

EXTRA! EXTRA! Meet the Brains Behind @AICPANews

Twitter has increasingly become the go-to place for industry news. Recently I sat down with James Schiavone, AICPA media relations manager and the brains behind the @AICPANews Twitter account, to discuss what he has learned from managing this thriving social media channel.

Q) The @AICPANews account was stated in March of 2009. More than 3,500 tweets and 17,000 followers later, what have you learned?

Beyond Compliance: The Benefits of XBRL

Data is the next great commodity resource. The equivalent of all the data that existed up to 2003 is now generated in two days, and 90% of the world’s total data was created in the last two years alone. Now comes a powerful new form of data, one that speaks the language of business. By the nature of its format, XRBL, or eXtensible Business Reporting Language, brings transparency to business information so investors can analyze data more easily and make informed investment decisions.

Audit Data Gathering in Ten Minutes or Less

Whether you were the auditor or the management in charge of an audit and even if you’ve tried to forget it, I’m sure you remember your first audit. Do you remember how long it took? A couple of hours? A few weeks? What was it like for the audit team to get all the data together? A picnic, right? I could be wrong, but I’m going to guess that’s not likely.

Imagine a world where it only takes 10 minutes to gather company data. Imagine putting standards and processes in place that could provide you with the data you need today. You may think that’s impossible, but we’ve seen it done. Whether it is for internal analysis, external audits, or company oversight, it is becoming increasingly important to obtain data on demand.  With the help of the AICPA’s new, non-authoritative audit data standards, this is now possible.

Assurance Services 101: New Tool for Providers and Users of Business Info

Imagine this scenario: On the hunt for additional funds to jumpstart their business, a potential client comes to you. The CEO has just visited the local bank, but the bank manager will not agree to lend the needed funds without assurance on the business’ ability to generate profits. Now, the potential client is at your doorstep asking if you can provide assurance.  

“Perfect,” you say. Your firm provides assurance services that instill confidence and assist clients in making insightful decisions. Here’s the thing: your prospect has no background on assurance services. Where do you begin to explain?

In the News: CPAs Predict Uptick in Hiring

It is--and has been--a tough time to look for a job in the United States (unless, of course, you are an accounting graduate). However, there may be some hope on the horizon for the legions of unemployed.

Business executives--while still expressing caution--continue to raise their expectations for hiring in the coming year. That’s according to the third quarter AICPA Economic Outlook Survey, a survey of 1,228 CEOs, CFOs, controllers and other CPAs in U.S. companies who hold executive and senior management accounting roles.

The CPA Outlook Index—a comprehensive gauge of executive sentiment within the survey—remained unchanged from last quarter at 69 points. The index is a composite of nine, equally weighted survey measures set on a scale of 0 to 100, with 50 considered neutral and greater numbers signifying positive sentiment.

The Real Obstacle to Tax Reform? Let’s Look in the Mirror

In one of the better teen movies of the '80s, "Better Off Dead," a paperboy ruthlessly stalks the main character in an intense pursuit of what he is owed, repeating, “I want my two dollars.”  

Johnny the paperboy is not alone, as the senators who proposed a blank slate approach to tax reform found out.  And of course, taxpayers want a lot more than two dollars.   I admit, I am one of those “what’s in it for me?” taxpayers but I am slowly coming around to a different philosophy. 

Lifelong Learning: The Fuel Driving Value Within an Organization

At the last meeting of the AICPA’s governing Council, I had the pleasure of moderating a panel discussion between three esteemed colleagues--all of whom are CGMA designation holders. Along with Bill Schneider, CPA, CGMA, Deirdre O’Connor, FCMA, CGMA and Ash Noah, CPA, FCMA, CGMA, I spoke about the latest issues affecting management accountants in business and industry--and how the education and experience that lead the earning the CGMA designation, and the continued learning that each of them do, helps them shape their unique, but equally phenomenal careers.

IRS Guidance Following DOMA Decision

In the wake of the Supreme Court’s Windsor decision invalidating a portion of the Defense of Marriage Act, the Treasury Department and the Internal Revenue Service announced on Aug. 29 that “same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes.” The IRS also issued a revenue ruling (Rev. Rul. 2013-17) and FAQs providing guidance on the topic.

In short, regardless of what state the same-sex couple currently lives in, if they were legally married in a jurisdiction that recognizes same-sex marriages as legal and valid, then same-sex spouses are married for all federal tax purposes. This podcast from Bob Keebler covers Revenue Ruling 2013-17, background on the DOMA decision, income, estate and gift tax planning implications, as well as portability, IRAs and retirement plans.

IRS Guidance Following DOMA Decision

Robert S. Keebler, CPA, MST, DEP, Partner, Keebler & Associates, LLP. Bob is a 2007 recipient of the prestigious Distinguished Estate Planners award from the National Association of Estate Planning counsels. From 2003 to 2006, Bob was named by CPA Magazine as one of the top 100 most influential practitioners in the United States. He is the past Editor-in-Chief of CCH's magazine, Journal of Retirement Planning and a member of CCH's Financial and Estate Planning Advisory Board. His practice includes family wealth transfer and preservation planning, charitable giving, retirement distribution planning, and estate administration.  

Vets Need Our Help: Now

Throughout history, our returning veterans have always faced challenges. However, recent reports have troubled me, showing that returning vets are facing more challenges than ever before.

According to a March 2013 study published by the Institutes of Medicine at the request of Congress, almost half of the 2.2 million troops deployed in Iraq and Afghanistan report difficulties on their return home.

Would You Recommend the CPA Profession to Your Kid?

Would you recommend the CPA profession to your kid? This is a question I used to ask the partners of my firm in Buffalo. I did our firm’s recruiting and felt this was an important question, because every new hire was someone’s kid. And in a small market like Buffalo, chances were, I actually knew their parents. I had to look those parents in the eye and tell them that when their child accepted a job with my firm, it was the right career move. I felt it was important for the partners to understand, if there was something in the firm that wasn’t good enough for their own kid, they had the power to fix it.

That same question sparked some lively discussion when I posed it to a group at the AICPA’s E.D.G.E. conference in Austin, Texas, this month. It goes without saying that the CPA profession provides virtually unlimited opportunities, offering a solid set of core competencies that can be put to work in a wide range of situations. Our CPA training and credential have formed a solid stepping stone for many of us, myself certainly included, to a very rewarding career.

New Gmail Tabs Could Hinder Efforts to Reach Your Customers

Not too long ago, Gmail started rolling out a new layout which features different tabs to group your emails. By default, Gmail users see three tabs: Primary, Social and Promotions. Users can now find their emails on one of these tabs, based on Gmail’s settings. This change doesn’t just affect Gmail through your browser, but also through the Gmail app on your smartphone. (If you access your Gmail through IMAP or Exchange settings on your smartphone, you will still see all emails in one inbox.) Google says it made this change to give users more control of their inbox.

Accounting for the Lean Transformation

Waste costs money. Companies lose money on wasted time, wasted effort and wasted material to the tune of millions of dollars per year.

Conversely, removing waste saves money.  And when it comes to keeping things on the right side of the ledger, it's far better to keep track of money saved than money wasted.

The Lean approach, especially as refined by long practice at Toyota and other manufacturers, systematically removes waste, frees up company resources, and increases a company's chance at long-term success. Money saved through Lean transformations can go toward capturing more market share, for instance, by improving existing products or developing new products for new markets.

Half of U.S. Adults Fail ‘Health Insurance 101’

I dislike going to the doctor – who doesn’t? However, in recent years I’ve found that I dislike the confusion I feel when I attempt to understand the vagaries of my healthcare provider’s policies even more. While understanding the policies can be frustrating, not understanding the basic terms of health insurance plans can lead to bad decision making and wasted dollars. And, unfortunately, a recent AICPA survey found that many Americans don’t understand these basic terms.

The telephone survey, conducted late last month for the AICPA by Harris Interactive, found that more than half, 51 percent of respondents, could not accurately identify at least one of three common health insurance terms: premium, deductible and copay.

A third, 34 percent, thought a premium was an expense at the time of receiving medical service or a prescription; more than a quarter, 27 percent, thought a copay was the cost of obtaining insurance; and 12 percent did not know a deductible is the money one pays before an insurance company makes payments.

“Half of Americans would fail health insurance 101,” said Ernie Almonte, CPA, chair of the AICPA’s National CPA Financial Literacy Commission.

Ensuring Privacy in an IT World

Do you expect a right to privacy? Do your clients? The truth of the matter is that the right to privacy is an ever-changing, ever expanding concept that continually needs to be redefined. That's especially true when it comes to ensuring privacy in an IT world. Ensuring privacy, which concerns the rights and obligations of individuals and organizations with respect to the collection, use, retention, disclosure and disposal of personal information, comes with risks.

3 Crucial Areas of Focus for Benchmarking

Maybe it’s an inherent competitiveness or just the pursuit of improvement, but it is commonplace for people to seek out benchmarks that they can use to assess their relative position or performance. It interests people to know how they compare to their peers. Benchmarks have a place in business, too, and can be an invaluable instrument to help business owners succeed.

Equipped with an intimate knowledge of their clients’ finances, accountants are uniquely positioned to help their business clients think strategically to achieve success. With assistance from accurate and relevant data, accountants can help their business clients by comparing their financial performance to the performance of their peers. This ability to effectively benchmark is one way to transition from a quarterly tax specialist to a trusted business adviser.

Assuming that accountants are able to get their hands on reliable industry data, it becomes necessary to isolate a few specific metrics that will be especially useful across industries. While different industries and companies measure success in their own unique ways, a few metrics are almost universally indicative of a company’s financial health.

If You or Your Clients are the Victim of Tax-Related Identity Theft

Tax-related identity theft is a multi-billion dollar business that may be affecting you and your clients. Identity theft is the fastest growing crime in the world. It can affect your credit and tax records and your earnings record—a criminal record may even be established in your name. No one is immune.

Identity theft that affects your credit record has been around for decades; however in the past 10 years, tax-related identity theft has seen an explosive rise. The statistics are staggering. A report from the Treasury Inspector General for Tax Administration indicated that during the 2011 filing season, 1.5 million fraudulent returns went undetected and refunds totaling $5.2 billion were issued to the wrong person. 

The Use of Intentionally Defective Grantor Trusts Post ATRA

In view of the changes brought about by the American Taxpayer Relief Act of 2012, estate planning has taken on a new complexion. With the portability rules and the applicable estate tax exclusion of $5,250,000 (indexed for inflation) being made permanent, ATRA has not taken away the need for estate planning; rather, it has changed what CPAs now need to plan for. Most CPAs working in the area of estate planning are shifting focus to asset protection, enhanced generational transfers and portability. 

AICPA President and CEO Barry Melancon, CPA, CGMA, stated this video to AICPA members that the primary purpose of estate planning is to financially protect and provide for loved ones. This same sentiment was echoed by Jean-Luc Bourdon in a previous blog post, Tax Planning Complexity Can Provide Growth for Your Firm. The message is clear: CPAs need to shift from estate tax planning to estate planning.

Audit Data Standards: Revolutionizing Business Information

One of the challenges that management and auditors face is obtaining accurate data in a usable format following a repeatable process. That’s why the AICPA’s Assurance Services Executive Committee’s Emerging Assurance Technologies Task Force seeks to increase audit efficiency by developing the following voluntary, uniform audit data standards: base standard, general ledger standard and accounts receivable subledger standard.

These non-authoritative audit data standards present a new way of optimizing efficiency and effectiveness in reporting and assurance by facilitating automation and enhancements in the analysis of business information. In addition, audit data standards identify the key information needed for audits and provide a common framework covering:

• data file definitions and technical specifications;
• data field definitions and technical specifications; and
• supplemental questions and data validation routines to help users better understand the data and assess its completeness and integrity.

Who will benefit from their use? A number of stakeholders, from internal and external auditors to software vendors. Let’s discuss.

That “Comfort Letter” Request May Really Be A Third-Party Verification

I continue to get requests from members on how to handle the "comfort letter" issue, as well as feedback on guidance the AICPA has developed and suggestions for how we can better advocate for our members and their clients. By way of background for those of you who may have missed my previous blog post, CPAs are often asked to verify a variety of client information for regulators, banks, insurance providers, state taxing authorities and more.

What they're asking for, basically, is a guarantee that certain information about a client is correct, such as confirmation of a client’s self-employment status; verification of income from self-employment; verification of a self-employed borrower’s business ownership percentage; and profitability or sustainability of a self-employed client’s business. While it's certainly understandable why they would want verification of this information, depending on what the request is can place CPAs in a risky situation. At the AICPA, we’ve received several inquiries from members regarding what is often referred to as "providing comfort" or “comfort letters.” However, the requests are actually “third-party verifications."

In the News: AICPA Conference Focuses on Developing Female Leaders

A recent AccountingWEB article by Deanna White highlighted the steps the AICPA is taking to develop more female leaders in the accounting profession.

"If you look at people coming up in the ranks over the last thirty years, 50 percent of the people in the profession are women but only 19 percent of leadership in the accounting and finance professions right now is female," says Mary L. Bennett, chair of the AICPA Women's Initiatives Executive Committee and founder of MLBennett Consulting LLC.

Bennett said that there is a perception that more female leadership in the accounting profession is an issue that will take care of itself - but that's not the case.

AICPA Accounting Competition: Play the Role of a Personal Financial Planner

There’s nothing like a personal financial incentive to challenge undergraduate students across the country to test their personal financial planning skills. The American Institute of CPA’s fourth annual AICPA Accounting Competition opened earlier this week, with teams competing for a $10,000 top award and second and third place prizes of $5,000 and $2,500, respectively.

The competition underscores the important role CPAs serve as financial planners at a time when young adults are dealing with crippling student loan debt and maxed out credit cards.

I spoke with Erin Curtis, AICPA manager, College Student Recruitment & Engagement, to find out some inside information about this year’s competition and what CPAs can do to help spread the word about the great opportunities a career in accounting provides.

Selling Your Practice? Make Sure You Cover Your Tail

Mergers and acquisitions and the many issues associated with turning a practice over to new owners are hot topics right now. According to the 2013 PCPS CPA Firm Top Issues Survey, succession planning was a concern for firms of all sizes. Practitioners are aware that a proper transition of clients and staff is crucial, but it’s also important to address questions about potential outstanding liabilities.

How are past claims against a practice handled when one firm is sold or merged into another? I recently received a call from a practitioner asking just that question. She was the sole owner of a three-person firm who was selling to her two employees. She was quite concerned that uncertainties about possible past liabilities might stand in the way of the sale.

Affordable Care Act Implications You Need to Know Now [PODCAST]

In this podcast, Ted Sarenski discusses the latest developments regarding health care reform and the Affordable Care Act, including what will be required of health plans offered both through exchanges and employers, the delay to 2015 of the requirement for large employers to offer health insurance, the individual mandate, penalties and federal subsidies, the October 1 deadline for health insurance exchanges, preexisting conditions, and Ted’s predictions and advice for clients in 2014. 

Affordable Care Act Implications You Need to Know Now

If you prefer, you can read the entire transcript below or download this and other audio webcasts from the Personal Financial Planning Section on AICPA.org.

Ted Sarenski, CPA/PFS, President, Blue Ocean Strategic Capital, LLC. Based in Syracuse, New York, Ted has gotten a taste for providing PFP services in a larger CPA firm and on his own. He provides financial planning services and manages assets. His compensation model is a mix of hourly, retainer and assets under management fees.

Inside the Business Valuation School: Pathway to the ABV

In July, 2013, I left public accounting and joined the AICPA as program manager for the Forensic and Valuation Services Section. As part of my introduction, the AICPA sent me back to school. I attended the National Business Valuation School from July 15 to 19 in New York. BV School is an intense five-day training program focused on theories, applications, best practices and controversies in business valuations.

For some of my 24 classmates, BV School was their first exposure to valuation education. For others like me, the course was a great comprehensive refresher on the complete Accredited in Business Valuation Body of Knowledge. Some were already practicing in the valuation area and took the course in preparation for the ABV exam. The Roadmap to the ABV Credential recommends BV School as one of several choices for valuation-related education.

SlideShare: An Introduction for CPAs

SlideShare is a slide deck hosting service that is gaining a lot of ground (and traffic) in the Web 2.0 space. Sometimes referred to as “the YouTube for slideshows,” SlideShare is a valuable source of information on just about everything.

Using SlideShare to find something.

If you are a visual person like I am, you may learn information much easier when it is presented in the format of simple slides with images than you would by reading an article or whitepaper. From XBRL to using social media for business, SlideShare has a vast array of content valuable to CPAs.

How do you find the content? Simply go to SlideShare and enter your search term.

You can also follow users or presenters to see any content he or she uploads regardless of topic.

What Does the Future of Accounting Education Hold?

During the three decades of my academic career, many industries have been transformed by the phenomenal changes in technology and globalization. But in my industry– higher education – there have been mainly beneficial effects of technology and globalization, with no major disruption to the basics of academic life. The way I spent my first days as a rookie Assistant Professor at the University of Southern California is remarkably similar to the life I am leading now as a chaired full professor at the University of Arkansas’ Walton College of Business.

Tapping Into Creativity: The Concept of Intrapreneurship

In the U.S., 12.3% of the population is identified as a nascent entrepreneur or owner of a business less than three years old. That is roughly 22 million people between the ages of 18-64. The number is even higher if you factor in the growing number of people who think about owning a business or work inside an organization. And who wouldn’t want to be an entrepreneur? They’re passionate, resilient, decisive and fearless. And because of these personality traits, they are often more innovative than their corporate counterparts.

Wouldn’t it be great if you could harness those personality traits in your own organization?

Young CPAs Share Their Success Stories [LIVE BLOG]

In this final session I will be covering from the AICPA's E.D.G.E. Conference in Austin, Texas, Donna W. Salter, Senior Manager, Young Member Initiatives, AICPA, moderates a panel of young CPAs. Learn how some very involved, young CPAs use their talents and skills to help impact the profession on the state and national level. By investing their time, these professionals have ultimately created a win-win situation—the profession addresses the leadership pipeline issues by training these young CPAs as volunteers, and they, in turn, get tons of leadership experience, mentoring, and professional development. Panelists include:

• Ebonie Jackson, CPA.CITP, CGMA, Strategic Management Consultant, Health Care Regulatory Consultants, LLC
• Dan Griffiths, CPA, CGMA, Director of Strategic Planning, Tanner LC
• Rachael K. Sarson, CPA, Senior Accounting, Craighead, Lange and Hough, P.C.

(Email subscribers: See the live blog coverage on AICPA Insights).

In the News: New Hot Spot for Young CPAs

I’m writing this blog post from the AICPA’s E.D.G.E Conference in Austin, Texas. E.D.G.E. is an opportunity for CPAs to gain management and leadership skills, while networking with leaders of the profession and discussing emerging issues. And since the conference is aimed at CPAs and practitioners with 5-15 years of experience, I’ve had an opportunity to speak to a number of younger AICPA members about the opportunities and challenges they’ve faced in their careers. My colleague and friend Heather O’Connor has posted a couple of great live blogs  from the conference and there are a lot of tweets on the #AICPA_EDGE hashtag you can check out to get a better sense of the content in the sessions.

Conferences are a great place to meet likeminded CPAs, learn about the issues facing the profession and help navigate the next steps in one’s career. Can’t make it to a conference this year? No worries, the AICPA has announced the launch of the Young CPA Network Community to help young CPAs enjoy many of the benefits of conference attendance from the comfort of their laptop or mobile device – like networking and career development.

Advancement of Women in the CPA Profession [LIVE BLOG]

Today's hot topic at the AICPA's E.D.G.E. Conference in Austin, Texas, is women's professional issues. In this session, Yasmine El-Ramly, CPA.CITP, Project Manager, PCPS – Firm Services, AICPA, and Mark Koziel, CPA, CGMA, Vice President, Firm Services & Global Alliances, AICPA, will describe best practices to promote the advancement of women in the profession at the organizational and individual levels. The AICPA is hosting the Women's Global Leadership Summit, Oct. 24 to 25 in Washington, D.C.

(Email subscribers: See the live blog coverage on AICPA Insights).