February 2000 - Journal of Accountancy

In his first address as chairman of the AICPA board of directors, Robert K. Elliott told the AICPA council he sees CPAs of the future as the people who help individuals and organizations through the strategic use of information systems. Photograph by Doug Wilson/Black Star lection to chairman of the

   RECRUITING Get to the best students early in their college careers. Securing the Future BY RAYMOND JEFFORDS, MARSHA SCHEIDT AND GREG M. THIBADOUX EXECUTIVE SUMMARY IN THE CURRENT COMPETITIVE hiring environment, the top students often have career path commitments by their junior year or have narrowed their search to

EXECUTIVE SUMMARY CASH BALANCE PLAN CONVERSIONS ATTRACTED public attention—and headlines—in 1999, when employee resistance forced IBM to modify its original proposal. Despite this, many companies have undergone successful conversions without negative publicity. COMPANIES THAT MADE A SMOOTH TRANSITION to cash balance plans achieved that outcome by addressing two critical issues:

EXECUTIVE SUMMARY IN THE CURRENT COMPETITIVE hiring environment, the top students often have career path commitments by their junior year or have narrowed their search to only a few firms by the time they are seniors. THE MOST EFFICIENT AND SUCCESSFUL WAY to match a student with a firm is

EXECUTIVE SUMMARY SOFTWARE THAT PREPARES diagrams, such as flowcharts, can be a handy addition to an accountant’s toolbox. SPECIFIC USES FOR DIAGRAMS in accounting settings abound. CPAs long have used flowcharts to analyze and illustrate internal controls, but today there are many more applications—from the flow of information processes to

EXECUTIVE SUMMARY FIFTY STATES AND THE American Bar Association currently prohibit lawyers from sharing fees with nonlawyers, such as CPAs, effectively barring multidisciplinary practices (MDPs). The ABA’s rule-making body, the house of delegates, shows signs it may reverse this ruling and allow lawyers and CPAs to share fees and be

EXECUTIVE SUMMARY GENERATION X ACCOUNTANTS are 21- to 35-year-old professionals who three years into their careers can command the same salary you worked 12 or more years to attain. Understanding who they are and what they want can help you hire them. TODAY EMPLOYERS HAVE TO WOO seasoned applicants. Create

EXECUTIVE SUMMARY WITH CONSUMER DEBT AT AN ALL-TIME HIGH, CPAs need to help clients focus more attention on debt management. The Federal Reserve says Americans owed $1.33 trillion, excluding mortgage debt, at the beginning of 1999. MOST LENDERS AND CREDIT COUNSELORS RECOMMEND that families limit debt payments to 36% of

EXECUTIVE SUMMARY IN AN EFFORT TO CONTROL COSTS AND MEET the needs of a changing workforce, some companies have converted their defined benefit pension plans to a cash balance formula. This has raised concern in Congress, the IRS and other government agencies that the conversions might discriminate against older workers,

EXECUTIVE SUMMARY MANY COMPANIES INVEST inordinate time, energy and financial resources to develop corporate plans only to change or even ignore them. BUT A FEW FORTUNE 1000 companies recognized that mistake and, as a result, are restructuring their planning and budgeting processes. THEY ARE SHELVING bottom-up planning and multi-iterative budgeting

Exhibit 2: Balance Sheet Impact of Cash Balance Conversion The Widget Co. had a noncontributory defined benefit pension plan that covered most of its employees in the United States. Effective January 1, 1999, the company converted the plan to a noncontributory cash balance plan for all active employees. Participants were

Exhibit 1: Converting to a Cash Balance Plan The examples assume the following: Defined benefit plan Traditional defined benefit pension plan benefits are based on a final 5-year average pay formula. Average annual salary increase: 4%. Cash balance plan Date of conversion to cash balance formula: January 1, 1999. Cash