EXECUTIVE SUMMARY THE AICPA HAS RECEIVED A NUMBER of inquiries regarding practitioners’ responsibilities in outsourcing engagements. The applicable guidance is found in the AICPA’s Code of Professional Conduct, the Gramm-Leach-Bliley Act and certain Internal Revenue Code provisions. THE CODE OF PROFESSIONAL CONDUCT STATES that a member remains responsible for ensuring
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Tax-Planning Services for Clients or Employers
EXECUTIVE SUMMARY THE AICPA ISSUED INTERPRETATION NO. 1-1, “Tax Planning,” of Statement on Standards for Tax Services no. 1, Tax Return Positions , partly in response to congressional inquiries about how the AICPA Code of Professional Conduct disciplines members who are involved with abusive tax shelters. It is effective December
Rules for the Written Record
hile some may consider report writing one of the more mundane aspects of conducting a fraud examination, documenting the case is every bit as important as investigating it. This article looks at how to record the results so end users receive the information they need and, equally essential, the report
Institute Proposes Auditing Standards Changes to PCAOB
In response to a Public Company Accounting Oversight Board (PCAOB) request for comments (PCAOB release no. 2003-05), the auditing standards board recommended amendments to standards included in the PCAOB’s interim professional auditing standards ( http://cpcaf.aicpa.org/Resources/Sarbanes+Oxley/Archive+-+AICPA+Submits+Recommendations+on+Auditing+Standards+to+PCAOB.htm ). The ASB also proposed issuance of a new auditing standard, Retention of Records Relevant
AICPA Comments on IRS Currency Transaction Proposal
The Institute’s tax executive committee submitted recommendations on IRS-proposed revisions to section 987 of the Internal Revenue Code that require a taxpayer to recognize exchange gain or loss—upon receiving a remittance from a qualified business unit (QBU)—by apportioning its basis in the QBU to each remittance and then recognizing exchange
Accounting Students Win Competition
The winners of the 2003 Accountemps/AICPA student scholarships are Molly Garvin of the University of Texas at Austin and Jeffrey Koga of the University of Wisconsin, Oshkosh—each of whom will receive $2,500 grants. Douglas Reese of Northern Illinois University won honorable mention and a $1,000 award. Representatives from Accountemps and
Materiality Considerations
EXECUTIVE SUMMARY FEW ISSUES INVOLVING THE PREPARATION of financial statements in conformity with generally accepted accounting principles have been more elusive and difficult to address and resolve—or of greater importance—than materiality. It also has proved challenging in planning and conducting financial statement audits in accordance with generally accepted auditing standards.
California Municipal Official Named Best Government CPA
Gerald A. Silva, San Jose city auditor, accepts the AICPA’s 2003 Outstanding CPA in Government Award from Costa Triantaphilides, chairman of the AICPA government performance and accountability committee, as AICPA project manager for new finance Pamela Green looks on. Since 1985, when Silva became the California city’s chief auditor, his
Investment Adviser Advertising
EXECUTIVE SUMMARY THE SEC REGULATES THE ADVERTISEMENTS investment advisers create to promote their services under rule 206(4)-1 of the Investment Adviser Act of 1940. The goal is to prevent advertisements that are false and misleading. RULE 206(4)-1(a) INCLUDES FIVE RESTRICTIONS advisers must follow. They can overcome two of these restrictions
Start a BV Engagement the Right Way
EXECUTIVE SUMMARY EACH VALUATION ASSIGNMENT IS UNIQUE, and often there’s more than one way to answer a question, interpret a fact or approach a problem. How the valuator prepares the client for the BV engagement sets its direction and becomes the foundation of the engagement letter and, ultimately, a responsible
The Auditor’s Approach to Fair Value
EXECUTIVE SUMMARY STATEMENT ON AUDITING STANDARDS (SAS) NO. 101, Auditing Fair Value Measurements and Disclosures, gives auditors guidance on understanding how an entity’s management calculates fair value and on determining whether that measurement conforms with GAAP. THE SAS’s PROVISIONS ARE EFFECTIVE FOR AUDITS of financial statements for periods
Socially Responsible Investing
EXECUTIVE SUMMARY AS CONCERN FOR THE ENVIRONMENT, SOCIAL ISSUES and corporate governance increases, CPAs may find more interest among their clients in investment strategies and mutual funds that emphasize social responsibility. SOCIALLY CONSCIOUS INVESTORS MAKE DECISIONS by screening for positive and negative issues, shareholder advocacy, community investing and providing social
Rebuilding Trust
illiam F. Ezzell—a partner of Deloitte & Touche LLP—assumed the AICPA chairmanship in October at the Institute’s annual meeting, which was held this year in Hawaii. Like all incoming chairmen, Ezzell faces a host of urgent priorities. But in the wake of the Enron scandal he has singled out
Why Compensation Committees Need Your Help
EXECUTIVE SUMMARY WHETHER WORKING IN THE FINANCE DEPARTMENT of a public company or advising that company as an outside consultant, CPAs are in a unique position to guide compensation committees in their role as corporate overseers and to help them better align compensation practices with shareholder interests. CPAs
The Surprising Benefits of Nexus
EXECUTIVE SUMMARY THE FRANCHISE OR BUSINESS PRIVILEGE TAXES SOME states impose on nonresident companies that have an economic presence in the state can be difficult for small businesses to handle on their own. However, in the right circumstances, CPAs may be able to help clients and employers achieve overall
A New Accounting Culture
The following is adapted from a speech made by AICPA President and CEO Barry C. Melancon at the invitation of the Yale School of Management. Mr. Melancon spoke before a group of business professionals and representatives of the media at the Yale Club in New York City on September
Make Strategic Relationships a Success
EXECUTIVE SUMMARY FOR ALL BUSINESSES, THE NUMBER of strategic relationships has been growing 25% per year since 1985. A FIRM’S FIRST STEP TOWARD a strategic alliance is to decide what capabilities it wants to add. Then it should decide what it wants to achieve: Does the firm wish to
Help Clients Take Measure
EXECUTIVE SUMMARY PERFORMANCE MEASUREMENT (PM) IDENTIFIES, monitors and improves those business activities that affect a company’s profitability. The method uses both leading (future) and lagging (past) indicators to assess how well a business is meeting its targets in the present. THE SEVEN ESSENTIAL STEPS FOR A PM system are: Prepare
The New Audit Documentation Requirements
EXECUTIVE SUMMARY STATEMENT ON AUDITING STANDARDS (SAS) no. 96, Audit Documentation, marks the first big change in the requirements auditors must observe when documenting their audit work. It provides general guidance on the nature and extent of documentation necessary to support the auditor’s report, and it reaffirms documentation’s role as
A New Scorecard for Intellectual Property
EXECUTIVE SUMMARY CPAs NEED TO ADVISE COMPANIES ON appropriate disclosure to financial statement users of intangible assets, acquired either separately or as part of a business combination. AUDITORS AND CORPORATE FINANCE EXECUTIVES must be aware of an important distinction in accounting for business combinations—certain intangibles such as intellectual property (IP)
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