Blockchain could be your solution to spreadsheet fatigue

Over 25 million Americans are still dealing with repairing airbags from one of the largest series of recalls in U.S. history. Car owners are waiting months for repairs – and many are unable to drive their cars while they wait for them to be fixed. Talk about inconvenient, expensive and frustrating.

Now imagine if airbag recalls didn’t have to be such a mess. Blockchain offers an intriguing solution.

Blockchain is a distributed ledger system that can be put to work managing our supply chains. Think of a big spreadsheet or Google doc that you use to record every transaction in a supply chain – from manufacturer to end user. Now imagine that every supplier, manufacturer and seller in the chain has access to that spreadsheet at the same time as you and is updating it with verified information in real time. Except, unlike a Google doc, you can’t retroactively alter information on the blockchain – making it extra secure.

Lead with inspired authenticity: chuck the checklist and find your why

Have you ever made your own “leadership skills checklist”? If you have, it probably included things like “active listening,” “decisiveness,” “delegation,” and “motivation,” to name a few. As accountants, we love to create checklists that can get us to a well-defined outcome – so why would we treat our efforts to become great leaders any other way?

The thing is, if we are only checking off skills on a list, are we really developing into the best leader we can be?

I believe the answer is a resounding NO!

To become the best leader we can be, we have to get past our skills checklist and dig into who we are and what drives us. If we can stop worrying about checking off skills and instead focus on our true purpose, we can lead our teams with authenticity and inspiration.

Nonprofit risk management 101

Nonprofit organizations are, by definition, on a mission. In pursuit of their missions, they may engage in risk-reward scenarios that for-profit businesses can’t afford to tackle. To further their cause, many nonprofit leaders accomplish more with less funding than seems possible. Unfortunately, limited resources create risk exposures. This may lead nonprofit management and boards to believe they can’t afford a risk management program. But they can’t afford not to.

Public trust is foundational to nonprofit organizations’ sustainability. Left unmanaged, risks can result in all sorts of losses: donors, employees, members, patrons and grants. Often, it’s not until a critical event occurs that risk management moves up the priority list.

In our experience (although risk management can seem overwhelming — especially for smaller organizations), it’s worth the time and resources.

How your organization handles personal data is about to change

If your organization or client handles personal data of any person residing in the European Union—even if the organization itself isn’t located there—pay attention. The way you store and manage that data may need to change significantly.

Enforcement of the EU General Data Protection Regulation (GDPR), which was ratified in 2016, will go into effect May 25, 2018. The GDPR was created to allow individuals to have greater control over their personal data and provide consistency across the EU member countries when it comes to data privacy rules. According to EUGDPR.org, personal data is defined as “any information related to a natural person or ‘Data Subject’ that can be used to directly or indirectly identify the person. It can be anything from a name, a photo, an email address, bank details, posts on social networking websites, medical information or a computer IP address.”

4 new opportunities blockchain could create for auditors

In case you haven’t heard, blockchain technology has the potential to change the auditing profession. A new whitepaper co-authored by the American Institute of CPAs details what opportunities could emerge for auditors.

Not sure what blockchain is? Don’t worry, you’re not alone. It’s a digital, distributed ledger that contains every transaction since its creation. Once transactions are entered, they can’t be changed or deleted. Every user on a blockchain has an identical version of the ledger, and all copies are updated automatically when a new transaction occurs. Each entry refers back to the previous entry across all versions, creating a “chain” of information.

3 myths about tax extensions

Sometimes filing a tax extension can be a benefit to your clients, but only if they are clear on what an extension means —and what it doesn’t mean.

If you’re a tax CPA, you’ve probably come across a client who chose not to file an extension because they misunderstood how it would affect them. On the other hand, maybe a client was happy to go on extension but for the wrong reasons.  

Below are three myths that your clients may have about extensions that you can proactively dispel.

5 busy season food cravings and how to feed them properly

Suddenly, in the middle of a client meeting or complicated tax return, you want — no, need — chocolate, or maybe French fries and fried chicken. There’s no doubt food cravings grow under stress. But they can also hit when we feel good or for seemingly no reason at all.

These guilty pleasures can be a great morale booster during busy season. Yet too much indulgence can lead to unhealthy weight, high blood pressure, type 2 diabetes and a host of other health problems! Cravings can’t be eliminated entirely but knowing your triggers and developing strategies for feeding them in healthier ways can help.

3 ways new software enhances CPA exam experience

If you took the CPA exam any time before 2004, images of an arena or hotel ballroom and No. 2 pencils and scratch paper still hold a prominent place in your memories. For those of you who took the exam after the American Institute of CPA’s launch of computer-based testing in April 2004, it was a much different experience. This important move helped the AICPA become a model for high-stakes testing, known for our ability to manage, deliver and score exams faster and more efficiently for candidates. 

Since computerizing the exam, we’ve remained focused on our ability to provide the best possible test experience. Some recent projects include the exam’s move to a web-based application for better test delivery, as well as a new item type (Document Review Simulation) that offers a more realistic simulation experience. 

Empowering women to be financial powerhouses

While preparing to host a webcast on women and money for a client company recently, I was asked why I thought we needed to have a separate webcast just for women – doesn't money work the same way for everyone?

The fact is that yes, money is money. But the way we relate to money, combined with differing life expectancies and career factors, means that we need to approach the "why" behind exercising healthy financial behaviors a little differently.

While everyone has questions about money, here are 3 common questions that I hear from women clients, and how I typically advise them to approach those concerns. What better day to think about this than on International Women’s Day?

Calling all CPAs – you should run for office

You know that feeling you get when you’ve helped a client in a concrete way? Perhaps you saved them money on their taxes, identified waste or even fraud. Maybe you designed a plan to take their children through higher education, helped them save for retirement or protect themselves from loss. Possibly you advised a small business startup, or helped a larger company report on their cybersecurity controls.

What if you could take that feeling — and your service — to the next level?

When you’re a CPA, you have a solid understanding of the many issues that power government: taxes, their assessment and collection and the rules that govern them; small business challenges and needs; financial literacy and responsibility; and myriad details of budgeting, responsible record keeping and the impacts of financial decisions.

CPAs’ expertise gives them a distinct advantage over other candidates, making them uniquely qualified to serve as thought leaders in government. As the country ponders the effects of the first major tax overhaul in more than 30 years, now more than ever, there’s a need for tax and fiscal expertise in our public servants. Who better to serve the community and protect the public interest than CPAs?

Now accepting applications: 5 tips for mid-season hiring

It’s the middle of busy season, and you’ve just realized you could use a little more help. Maybe you underestimated your firm’s capacity, or a staff member unexpectedly needed to leave. When it’s all hands on deck to manage client needs, mid-season hiring is a curveball no firm wants to face. Here are a few ways to prevent such departures and prepare for the unexpected.

An ounce of prevention

Of course, one of the best ways to handle mid-season hiring is to prevent departures. 

While people will leave, and not always at the best time, a firm should try to create a fun office culture so employees won’t want to go anywhere else. This means creating a family-like atmosphere in hopes that staff members are less likely to leave “family” in the middle of a busy time. To make the firm more inviting, consider:

Forensic and valuation pros: 4 ways tax reform affects you

Tax reform affects more than just taxes. It has lasting implication for all CPAs and introduces some uncertainty for financial forensics and business valuation. Depending on who your clients are, you may feel this more than other CPAs.

If you concentrate in estate and gift tax valuation, now is a good time to start looking outside those business models by leveraging the opportunities that have come up since the new law was signed.

In a recent interview, Don DeGrazia, CPA, ABV, CFF, partner with Gold Gerstein Group LLC, explained the P.L. 115-97, known as the Tax Cuts and Jobs Act, makes the federal estate tax temporarily go away for many tax payers. While state estate or inheritance taxes are still in effect, they don’t provide nearly the same volume of business.

A behind-the-scenes look at the CPA Exam

Most CPA Exam candidates can rest assured knowing the time and energy they’ve spent leading up to exam day has prepared them for what to expect. Reviewed content and structure, section by section in the Blueprints? Check. Practiced with the sample tests to learn the exam’s functionality? Check. Confirmed test windows, how scoring works and made that test day appointment? Check. Understood the importance of language in the exam and what goes into the wording of each question? Che...wait. What?

Understanding what goes into the development of exam questions may provide extra insight for test day when you sit for the exam, which surely adds to your confidence. Read on to explore some of the behind-the-scenes considerations from creation to approval, fairness in the wording, as well as knowing with certainty that each multiple-choice question has only one right answer.

Start your audit off right with data analytics

When planning an audit, how do you approach your preliminary analytics? Many auditors perform a variance analysis. They compare current year account balances to the prior year to identify any unexpected fluctuations. While this procedure often yields relevant insights, did you know performing audit data analytics (ADAs) can be even more effective at identifying potential problem areas? ADAs can be quick and painless, and you probably already have the tools on hand to perform them.

The one thing stopping you from making better decisions

It’s been several years since your last dodgeball game in the high school gym, but you may remember it like it was yesterday. Nervous energy hangs in the air during those moments when the captains choose their teams. No one wants to be picked last.

Human nature is at play, compelling Captain Kim to choose Mark instead of you. Maybe it’s Mark’s athletic ability, or maybe it’s because he lives on Kim’s street and she is more familiar with him. Kim’s unconscious bias drives her toward one classmate over another. For the person whom Kim picks last, it might sting a little.

Without realizing it, every day in our professional lives, we make choices similar to Kim’s. It’s not always pleasant for everyone involved. All humans have a hardwired need to belong. If we don’t check our unconscious bias and unknowingly show favoritism, we risk alienating our colleagues and staff. That can affect engagement, productivity and team cohesion.

The good news is that you can train yourself to become mindful of your unconscious bias and strengthen your relationships in and out of the office. Try this practice I call the Three Rs.

Engagement letter stories — when they hurt and when they worked

As a risk management professional at CNA, professional liability insurance carrier for nearly 25,000 CPA firms, I am often asked if engagement letters are worth all the effort. The answer, based on my personal and CNA’s claim experience, is a resounding YES!

I’ve experienced firsthand the value these letters bring to the table. When an engagement letter is used, and a claim arises related to that engagement, the losses are typically less severe (meaning less expensive) than if an engagement letter had not been used. But what means more (especially to a CPA) than more money in your pocket? Many professional liability insurance carriers provide premium credits or other benefits for firms that use engagement letters.

If it’s not enough to just trust the numbers, consider the following experiences of CPA firms that have or have not used engagement letters.

One that hurt — no engagement letter meant higher risk

A CPA was engaged to prepare income tax returns for a small business and its owner for many years. The owner regularly spoke with the CPA about his plans to sell the business and ultimately retire. One day, the client did just that and moved away.

Blockchain was made to solve 1 problem. Here’s what that is.

“Blockchain is a solution looking for a problem. Unless you want to buy drugs on the internet,” said the instructor in a technology training I recently attended.

While not the first time I had heard such a comment, it was disturbing that a hundred of my fellow practitioners were being misled. Ignoring or dismissing blockchain does the accounting profession no favors. Instead, let’s consider the problem that the technology solves. This will provide a basis for later understanding possible applications to our work.

 What is the problem blockchain is trying to solve?

Blockchain, or distributed ledger technology, set out to solve how we transfer a digital asset between two peers without an intermediary. While there are many applications of this transfer, let’s look at it in the context of money.

Imagine you are selling a bike online. You don’t actually know the person who is buying your bike, so you have no way of knowing if the buyer actually has the money to pay for it. You have to trust an intermediary like PayPal for this information. PayPal is crucial to the transaction because it verifies what you cannot – whether the buyer has enough money in their bank account to make the purchase.

The asymmetry of trust in this transaction is known as the Byzantine General’s Problem. Imagine we have four generals planning to attack a city. At least three of the generals must attack at the same time to overpower the army holding the city. However, the only way they can communicate with each other is via messenger, and they do not know if one of the generals is a traitor. If a general were traitorous, he could modify the attack message and cause the other generals to fail. The only way to overcome a traitorous general is to provide the history of all messages sent and evidence they have not been altered. If the generals see that one of their peers has sent a message different from the others, they would know the general is traitorous and disregard his message. If more generals are good actors than bad in this attack, the correct message will be obvious.

10 tips to tackle the CPA Exam during busy season

If your time already seems extra valuable during busy season, try studying for the CPA Exam at the same time. Many do it, however, as they power forward to earn a credential that will significantly enhance their professional lives. If you’re about to jump into juggling the demands of busy season and test preparation, here are a few tips from CPAs I talked to who’ve been there, done that and earned their CPA.

1. Plan your time.

CPA Leighton Smith, who is a finance director at Microsoft, calculated the time he thought he’d need to study each quarter. He then tracked his actual weekly progress and made adjustments as needed. “I didn’t want to leave anything to chance,” he says.

2. Stretch the workday.

To keep on track, you’ll have to wake up early, get to bed late and study on the go. “When I took the metro to work in the morning, instead of reading or listening to music, I worked with flash cards that I had made the night before based on my reading,” says CPA Jeff Wilson, advanced QuickBook ProAdvisor at The W2 Group, LLC. During his 30-minute commute each way every day, CPA Caleb Bullock, business development manager at Somerset CPAs and Advisors, listened to lectures. “I did it every spare minute,” he says.

10 busy-season exercises CPAs can do at their desks

Busy season means tough choices—dividing daily life into essentials and non-essentials. Food: essential. Sleep: essential. You know exercise is important, but is it essential? Research shows that completely dropping your exercise routine for just a few weeks can put you at increased risk for a heart attack or stroke. But findings also show that even short periods of exercise can reduce those risks while boosting productivity and reducing stress. But how? If you don’t have time for a full routine at the gym or outside, deskercise!

Social security benefits hacked: A cautionary tale

If you or your clients are at or nearing retirement age, you need to know that hackers are targeting social security accounts. I found out the hard way. My career as a CPA Personal Financial Specialist was devoted to advising individuals and families on their most important financial goals, including tax, retirement, estate, risk management, investment and retirement planning. After decades of helping my clients navigate and manage these important decisions, imagine my surprise when I received a letter in the mail shortly after my 67^th birthday congratulating me on initiating my Social Security benefits. The trouble was, although I had entered the glory years of retirement, I had not yet applied for Social Security benefits, opting to wait until age 70 to receive my benefits. Further digging uncovered the unfortunate fact that a thief had received $19,236 of my benefits. I was dumbfounded.

Personal financial satisfaction extends record run…but for how long?

Americans are experiencing unprecedented levels of personal financial satisfaction, the highest in the 24-year history of the AICPA’s Personal Financial Satisfaction Index (PFSi). After seven consecutive quarters on the rise and a second quarter in a row setting at an all-time record, the average Americans’ personal financial satisfaction has been steadily picking up steam. With financial satisfaction climbing to new highs, some can’t help but wonder when this rise will end.

First, some background. The PFSi is a quarterly economic indicator that measures the financial standing of the average American. It’s calculated as the difference between two sub-indexes: The Personal Financial Pleasure Index, which measures the growth of assets and opportunities, and the Personal Financial Pain Index, which calculates the loss of assets and opportunities. The Pleasure Index is made up of four factors, the largest contributor being the PFS 750 Market index. The Pain Index is also comprised of four factors, with the largest contributor being personal taxes. Most recently, the Pleasure Index (69.2) greatly outweighed the Pain Index (42.3) bringing the PFSi to a positive reading of 26.9, the highest reading since 1994.
 

Busy season cheat sheet: 8 considerations to make it easier

Time is always a precious commodity during tax season, but especially so this year. On top of starting to prepare 2017 tax year returns, CPAs are working to figure out exactly how the tax reform law affects clients.

Before you start pulling your hair out, take a deep breath and remember the wise words of Eleanor Roosevelt: “This too shall pass.” Then, check out the AICPA resources that not only make preparation a bit more convenient, but will also help you impress your clients by answering their questions before they even ask them.

Take a timeout: 9 do’s and don’ts for a good work break

Your neck and back ache from hunching over your desk. Your eyes burn from staring at a monitor. You don’t want to stop because the clock is not your friend today. Yet stopping can, in fact, make the clock your friend. 

Taking a break on the busiest of days (and, of course, this is the busiest of seasons for tax CPAs) can be hard to do. I get it – while working on a deadline, I hyper focus and hate to put myself on pause. But I make myself do it because I know from experience that it will ultimately lead to greater productivity.

You don’t have to take my word for it, science says the same thing. Consultants monitored people’s productivity using an application called DeskTime and found that the best performers worked for 52 consecutive minutes followed by a 17-minute break. Not too surprising, considering that scientists have learned that our brains are better at solving complex problems when given a chance to relax. Think of that “aha” moment that comes to you when you’re in the shower or picking up dry cleaning. 

5 items you need in your firm’s owners’ agreement

What’s in your owners’ agreement? I recommend creating these critical documents when the firm is first formed and updating them as needed. An effective agreement can enhance decision-making and productivity, and it’s also the foundation for a successful changeover to new internal ownership. Even in a merger or acquisition, the decisions set forth in an owners’ agreement can set the stage for a smoother and more rewarding transition. Here are some significant issues that should be addressed in any agreement.

Firm governance. When you establish policies on who will run the organization and how it will be run, it can enhance efficiency and profitability. No matter how independently each partner may handle his or her work, there are many advantages to having common agreement on some key issues, such as:

5 things I wish I knew when selecting an ERP system

Accounting professionals in the not-for-profit sector wear many hats. We often have the blessing and curse of selecting and implementing enterprise resource planning (ERP) systems. If you have undertaken this herculean effort before, you’ll probably never forget the education you gained throughout the experience. If you haven’t had the opportunity yet, there are some things you should consider to help your not-for-profit or your not-for-profit clients avoid mistakes. Here are five key lessons I learned when selecting an ERP system for my organization.

1. You get what you ask for. It’s important to be specific about what you want to do and how you want to do it so you can find out if vendors can accommodate your needs. If the business requirements you specify are too generic, you may be surprised to discover significant gaps in the system’s capabilities too late in the game. For example, saying you need the ability to make electronic payments may be too generic. Instead, indicate that you need the ability to automate batches of electronic payments via EFT and wire. In this example, the added clarity ensures the system can not only make electronic payments but also process them via EFT, and that payments may be initiated through automatic batches rather than manually, one by one.

3 things more important than tax reform in 2018

Your phone’s already ringing. Clients want to know how the new tax law will impact them. This is understandable, but don’t worry if you aren’t ready to answer their questions just yet It’s a big law and the IRS has yet to provide even the most basic guidance. For most businesses, taxes aren’t the first thing to look at in 2018—in fact, taxes probably shouldn’t be your clients’ second or even third priority. During your client meetings consider tackling these other issues that haven’t made the 6 o’clock news.

1. Everybody needs to fully reevaluate their accounting.

To start with, after two years of delays, US GAAP is undergoing its biggest changes in decades with implementation of FASB’s new revenue recognition and lease accounting standards. Aside from the high-profile changes for software providers, virtually every business in America that reports under US GAAP will see significant changes to their accounting for revenue recognition. Most of these businesses have leases to look at too.

What’s the price tag on your college football team?

The stage is set. Who will be crowned the 2018 College Football National Champion tonight? Georgia and Alabama, the teams left standing in the playoffs, will face off to decide. The game is expected to draw a huge viewing audience. Last year’s title game between Clemson and Alabama – the Crimson Tide is back for a third straight year – pulled in more than 26 million viewers.

It’s no secret college football is big business. There’s been a long-time debate about whether student-athletes should get some of the profits (this blog post won’t go down that road). But how do you put a price tag on a team?

Having fans throughout the country focused on top-ranked teams during the season can really boost a university’s brand. A winning football program can lead to a university’s higher student enrollment, better alumni engagement, more scholarships, high-profile donors and increased visitor spending in the community on gamedays.

So, which college football program has the highest net worth? According to a 2017 analysis, Ohio State. The program has a $1.5 billion value, a 50% jump just from the previous year. The increase perhaps because of the Buckeyes’ 2015 national championship win. Texas and Oklahoma trail Ohio State valued at $1.2 and $1 billion, respectively.

Why you shouldn’t make a New Year’s resolution

Each year, millions of Americans lose an average of 20 pounds and learn a new language within a few months of making their New Year’s resolutions.

Wait, what? That’s not actually true. I can tell you what really happens: Every January 2, a slew of people show up at my gym and hog the treadmills. It is rather frustrating. Luckily, I know they’ll be gone in a few weeks. That’s because they are part of the 80% of Americans who abandon their resolutions by the second week of February.

There has to be a better way. What if instead, we set goals throughout the year, rather than all at once when the clock strikes midnight? We would be less likely to feel overwhelmed by our commitment to training for a marathon and writing a novel, so we’d have a better chance of getting something done. After doing some research, I found a few other tips to achieve those goals you set.

Be specific. Begin by writing down exactly what you want. We’d all like to be more successful or more fulfilled, but what exactly does that mean to you? Let’s say you’d like to raise your professional visibility. There are a number of ways you can do it, including getting further training that can make you more valuable to clients or your employers or becoming more involved in professional or community organizations. And remember this isn’t a once-a-year activity, since it’s good to set new goals as circumstances change and new opportunities pop up.

4 tips for not-for-profit accounting staff

We know the feeling. You already have a lot on your plate. And now there are significant changes coming down the pike in the form of Financial Accounting Standards Board (FASB) accounting standards updates and tax reform. If you find yourself hoping the nonprofit accounting environment will settle down in 2018, you’re not alone. But alas, we’re here to help. Consider these tips:

Start at the top.

Having a well-run not-for-profit board is important for making sure strategic objectives are met even as changes occur. If you have open seats, be sure you select new board members carefully. Identify a diverse range of skills and experience that you’re looking for when recruiting board members. These may include finance, information technology, human resources, marketing, fundraising or law. For more advice, check out these governance and management FAQs and this blog post on 5 tips for an effective not-for-profit board.

Bitcoin may burst. You still need to learn about it.

On December 19, 2017, Bitcoin was trading at just over $17,700 – an increase of more than 34,000,000% over its 2011 price of $0.05. Almost all this exponential growth has been in 2017, which has people asking if Bitcoin is a bubble.

My opinion? Yes. It has many of the classic signs.

Bitcoin’s value has increased dramatically in a short time, attracting novice investors. Its valuation is extremely difficult since it’s not backed by anything tangible like gold or silver. Lastly, as an investment, Bitcoin doesn’t pay interest or dividends. To make money, investors will have to sell their Bitcoins. For these reasons, I think the Bitcoin bubble will burst eventually. I’m just not sure what the triggering event will be or when it will happen, but it will happen.

5 cookie recipes for the best holiday ever

Happy Bake Cookies Day! Yes, there is an entire day dedicated to baking cookies, and it conveniently happens to fall close to the winter holidays. So, if you’d like to celebrate what is, in my humble opinion, the best holiday ever, or if you’re just looking for a way to fill your time away from the office, warm your heart (and your oven) with one of these cookie recipes crowdsourced from Association employees.

Hungarian Butter Cookies

This one is a family recipe from Communications Manager Alexis Rothberg. I can confirm that Alexis’s dessert skills are top notch, so this one is bound to be a winner.

Ingredients

2 sticks unsalted butter, softened

1/2 cup sugar

½ teaspoon salt

2 teaspoons vanilla extract

Credit losses: A new scope

If you have put off reviewing the Financial Accounting Standards Board’s (FASB) new Credit Loss standard since its effective date is “in a galaxy far, far away,” you are not alone.

This is the largest accounting standard change affecting depository institutions (and other industries) within the last 40 years, so it can be intimidating for management to get started. Plus, the amount of flexibility and professional judgement allowed within the standard itself has caused confusion and fear, making it hard even to begin.

Do not give into your fear. “Fear is the path to the Dark Side.” Instead, read below to digest the new standard piecemeal, and to understand what it does and doesn’t say. Then you will have the tools needed to take the steps to implement it. 

Procrastinators beware, the nonprofit audit is not the place to drag your feet

7 key steps to master revenue recognition implementation

Standard setters have made game-changing revisions to revenue recognition standards, and the effective date for implementation is fast-approaching. The new standard replaces the existing transaction- and industry-specific revenue approach with a principles-based approach. Is your organization ready for this shift?

The new standard was originally issued by the Financial Accounting Standards Board as Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (the International Accounting Standards Board has also issued guidance with the same name), and several clarifying amendments have since been issued. The guidance affects all entities—public, private and not-for-profit—that have contracts with customers. The standard’s original effective date was postponed because of the complexity involved.

5 easy strategies to help your candidates pass the CPA Exam

As a recently licensed CPA, the long study hours, time commitment and life balancing I did to prepare for the Uniform CPA Examination is still fresh in my mind. After reading the Journal of Accountancy article in which members shared their personal exam experiences, I started thinking back to my own journey as a candidate.  

I can remember the moment I finally received the results of my last exam section. I was filled with an overwhelming sense of relief and, of course, pride. My commitment to accounting had paid off. But one thing that stands out to me is when I prepared for the exam, I focused on a few strategies for success. 

I know your firm’s CPA candidates will each have their own way to tackle the exam. But as someone who has been through the experience, I think it’s helpful for you to share your knowledge and personal experience. Don’t hesitate to talk about what worked and what didn’t. Let them know you understand what they’re facing.

So, where to start? Ask your candidates a basic question: “What’s your exam strategy?” If you get the long, awkward pause, here are five quick tips to share:

1. Understand the candidate requirements

For anyone pursuing the CPA, this is where it all starts. The exam process requires quite a few steps, so it’s best to know the lay of the land ahead of time. My journey began with a seminar hosted by the New Jersey Society of CPAs. I learned all about what I needed to do, what the requirements were and which exam partners I needed to turn to for guidance. The key is doing your homework before you jump into testing.

Preparing for busy season after natural disasters

Your clients are counting on you to be up-to-date on the latest in tax. This means keeping them informed on how major storms, floods, and wildfires could affect their returns.

We saw the hurricane headlines, and they were shocking. Three major storms stood out for their ferocity and damage. Hurricanes Harvey and Irma killed more than 100 in the United States and caused more than $150 billion in property damage. Puerto Rico was hit hard by Hurricane Maria. The island lost all power and nearly all cell service. In some places, these services have yet to be restored.

And it wasn’t just hurricane season that was unusually active. Wildfire season has been one of the worst on record. Almost 9 million acres have burned in wildfires across the western states.

And the year isn’t over just yet.

In November, TEC Chair Annette Nellen, CPA, CGMA, spoke on this topic and offered advice at the National Tax Conference in Washington, D.C. Here are some of the key considerations she shared to get you and your clients ready for busy season.

4 financial benefits of single audit specialization

Can a small firm thrive by building a niche within a highly specialized audit area? My firm, Clausell & Associates, P.C., in Decatur, Georgia, has found the answer is a resounding “yes.”

Our 10-person firm opened in 1987, three years after Congress passed the Single Audit Act. This landmark legislation standardized audit requirements for states, local governments and Indian tribal governments that receive and use federal financial assistance. Our firm’s founders saw an opportunity to establish themselves in this new and growing niche. Today, single audits make up about 60 percent of our practice, so the original decision to specialize in single audits was a great move for our firm. 

For practitioners thinking that specializing may limit their practice, don’t worry. Over the years, our single audit expertise has helped to set us apart in the marketplace and drive our growth. Here are some of the rewards that we have found through single audit specialization. 

4 good reasons to go to that networking event

We are all busy. When we aren’t at work we’re juggling a long list of priorities, including spending time with family and friends, partaking in hobbies or running errands that can’t be put off any longer. You will notice, nowhere in that list is attending networking events.  But that shouldn’t be the case.

Here’s a story that might inspire you to slap on a smile, put on a nice outfit, and go to that networking event—even if you’d rather sit on the couch catching up on This Is Us.  When one CPA, Heather Zundel, moved from Las Vegas to Albuquerque, she joined her state society and started showing up at their events. Along the way, she formed strong relationships that helped her feel rooted in her new community.  This involvement led to leadership opportunities as well, such as becoming the youngest woman to chair her state CPA society’s board of directors.

Secret Santa 101: Brush up on gift exchange game rules

The office tree has been trimmed, the halls have been decked and everyone is scrambling to get all of their end-of-year work done. But before you can leave the office for the holidays and officially begin the festivities, there’s one thing left to do: the office gift exchange.

More budget-friendly than your typical office party, a gift swap get-together might be the way to go. Consider these three gift giving games for your small firm’s holiday celebration. They will make everyone feel jolly and turn a potentially ho-hum gathering into a ho-ho-holiday team bonding experience.

Game: White Elephant  

How to Play: Have you ever looked at a gift someone just received with envy because you wished it had been given to you instead? With White Elephant—also known as Pirate Santa, Yankee Swap and Dirty Santa—you’re in luck. That coveted gift can be all yours.

The Form 990: Not-for-profits, you can run, but you can’t hide

 

You asked, we delivered. A more flexible attestation standard.

We heard from members. Their clients want them to perform procedures and report in a format similar to an agreed-upon procedures (AUP) engagement, with more flexibility. To be responsive to the needs of our members and the public, the AICPA Accounting and Review Services Committee (ARSC), got together with the Auditing Standards Board (ASB) and developed a new proposed standard, Selected Procedures. If adopted, it will address several practice issues that CPAs are experiencing today and result in a standard that is in the public interest.

Development of the procedures

In an AUP engagement:

• The CPA performs procedures that are established by specified parties.
• The specified parties are responsible for the sufficiency of the procedures for their purposes.
• The engagement letter is required to include agreement on the procedures.
• In circumstances where the procedures evolve or are modified over the course of the engagement, the CPA is required to amend the engagement letter to reflect the modified procedures.
• The practitioner’s report is restricted to the use of those parties that established and agreed on the sufficiency of the procedures

In practice, many CPAs find that the specified parties are unable or unwilling to develop the procedures needed.

Your new, blockchain supported job

You’ve probably heard that blockchain technology is going to disrupt accounting. (If you read AICPA newsletters or accounting news articles or attend our conferences, you have definitely heard this.)

But do you still find yourself wondering exactly how it is going to do that? Look no further. We’ve compiled 4 big ways your job could change because of the blockchain.

Personal financial satisfaction hits record high - what’s in it for me?

Personal finances are like fingerprints, everyone is unique. With the AICPA’s Personal Financial Satisfaction Index (PFSi) at an all-time high, you may be wondering what it means for you.

Let’s start with some background. The PFSi is a quarterly economic indicator that measures the financial standing of the average American. It’s calculated as the difference between two sub-indexes: The Personal Financial Pleasure Index, which measures the growth of assets and opportunities, and the Personal Financial Pain Index, which calculates the loss of assets and opportunities. Most recently, the Pleasure Index (68.1) greatly outweighed the Pain Index (42.1), bringing the PFSi to a positive reading of 25.9, the highest reading since 1994.

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

Cash, 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:

5 ways to make the most of your small office space

Do 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.

5 tips for an effective not-for-profit board

Survey 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.

Don’t overlook this important subject with clients

We’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.

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

Cybersecurity 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.

Beyond tax: Extending your success

As 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:

The road to retirement starts here

When 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.