EXECUTIVE SUMMARY COMPLYING WITH SARBANES-OXLEY HAS LED many companies to search for a better way to manage all the regulatory demands they face. Some are doing so on an enterprise-wide basis by coordinating and integrating compliance into all facets of their business. COMPANIES NEED A FRAMEWORK TO HELP them manage
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TOPICS / TAX
IRS practice & procedure
Compliance Is Expensive
Source: PricewaterhouseCoopers Barometer Survey of 151 CFOs and managing directors of U.S.-based multinational companies, New York, www.barometersurveys.com , 2004.
Assessing Company-Level Controls
EXECUTIVE SUMMARY THE ASSESSMENT OF COMPANY-LEVEL CONTROLS is a critical part of complying with section 404 of Sarbanes-Oxley. The PCAOB says public companies must assess the design and operating effectiveness of these controls in addition to examining detailed process- and transactional-level control activities. COMPANY-LEVEL CONTROLS ARE THOSE THAT PERMEATE an
“Outsourcing, Offshoring, Nearshoring: What to Do?”
EXECUTIVE SUMMARY FANS OF OFFSHORE OUTSOURCING SAY it lowers labor costs; it’s efficient; and it lets firms accept new work during periods of peak demand. SOME LONG-TERM CONCERNS CPAs VOICE ARE: How will outsourcing affect the traditional CPA career path? How will it affect U.S. employees’ training? How will accountants
No Longer an Option
EXECUTIVE SUMMARY IN DECEMBER 2004, FASB ISSUED ITS NEWEST standard, Statement no. 123(R), Share-Based Payment. It is proving to be as controversial as its predecessors. The most significant change is the requirement that companies use the fair value method to account for share-based compensation. STATEMENT NO. 123(R) ELIMINATES THE USE
SmartStopsOnTheWeb
Keep Tabs on Their Money www.carsonwealth.com The Carson Wealth Management Group Web site’s Research section offers CPA investment advisers news headlines and market summaries from Dow Jones, the Nasdaq and Standard and Poor’s—with the latest index figures and most recent changes, a stock quote center and a mutual fund lookup.
XBRL: A Multitalented Tool
PAs have a rare opportunity to help the business world take a giant leap forward. The extensible business reporting language (XBRL) can vastly improve the timeliness, accuracy and flexibility of data in financial statements and other business reports. Many experts think it will boost today’s commerce just as double-entry bookkeeping
Smart Stops On The Web
Articles on the Act www.fmsinc.org/cms/?pid=3253 CPAs and compliance officers can enter this site through the back door to find ten pages of links to SOX news articles, including “Sarbanes-Oxley: A Sense of Siege” and “FEI CEO’s 2005 Top 10 Financial Reporting Issues.” Users also can click on Web Resources for
IRAs and 401(k)s: How to Pick the Best Plan
EXECUTIVE SUMMARY RETIREMENT PLANS ARE OFFERED BY a variety of providers, including financial institutions, insurance companies and payroll service providers. But adherence to IRS regulations is the responsibility of the business owner. ANY BUSINESS WITH ONE EMPLOYEE that does not have any other type of retirement plan can set up
Trust Services: A Better Way to Evaluate I. T. Controls
EXECUTIVE SUMMARY SARBANES-OXLEY REQUIRES MANAGEMENT to include an assessment of internal controls over financial reporting, using a suitable framework, in the annual report. While a number of frameworks are available, some do not adequately assess technology controls. SEC RULES SAY MANAGEMENT MUST BASE its evaluation of the effectiveness of internal
Smart Stops On The Web
Keep Abreast of New Rules www.sarbanes-oxley.com CPAs and compliance officers can find a link at this PCAOB Web site to a free Sarbanes-Oxley section 202 audit fee disclosure calculator, as well to the latest SEC rules and regulations cross-referenced to other specific sections of Sarbanes-Oxley, such as section 208 for
Selling To Audit Committees
EXECUTIVE SUMMARY SARBANES-OXLEY HAS CHANGED the relationships CPAs have with the entities that employ them. Before, an audit committee was essentially an extension of a company’s board of directors, often rubber-stamping the CFO or CEO’s choice of auditor. Since the act, corporate boards and audit committees have taken
Section 404 Compliance in the Annual Report
EXECUTIVE SUMMARY BEGINNING IN 2004, MANY PUBLICLY traded companies must comply with SEC rules by reporting on the effectiveness of their internal controls in the annual report. The content should contain A statement of management’s responsibilities for establishing and maintaining an adequate system. The identification of the framework used to
Substantial Compliance No Substitute for Filing Election
TAX BRIEF Substantial Compliance No Substitute for Filing Election A taxpayer’s sale or exchange of investment securities generally does not qualify for nonrecognition of gain as a like-kind exchange. However, when taxpayers (other than C corporations) sell securities that they have held for at least three years in a
Are You Spamming Your Clients?
EXECUTIVE SUMMARY WITH THE ADVENT OF FEDERAL LAWS controlling spam e-mail, CPAs must exercise caution in their communications with clients and prospects. In so doing they can improve the look and effectiveness of their e-mail marketing programs. THE CAN-SPAM ACT OF 2003 INCLUDES civil and criminal penalties for predatory and
E-Mail and the Law
EXECUTIVE SUMMARY SPAM IS A BUSINESS PROBLEM companies now must address because of domestic and international laws. Companies need to adopt Internet marketing privacy policies to comply with various privacy and spam regulations. CPAs can use the AICPA/CICA Privacy Framework to help organizations accomplish these goals. THE AICPA/CICA PRIVACY FRAMEWORK
Smart Stops on the Web
COMPLIANCE SITES Sarbanes-Oxley Act/PCAOB Implementation Central http://cpcaf.aicpa.org/Resources/Sarbanes+Oxley/ The+Changing+Regulatory+Landscape.htm Auditors and CPAs looking for background material and implementation guidance on the 2002 act will find documents including “How the Sarbanes-Oxley Act of 2002 Impacts the Accounting Profession” at the Institute’s Web site. Visitors also can download “Key Internal Controls for Management”
Evaluate the Control Environment
EXECUTIVE SUMMARY MANAGEMENT IS RESPONSIBLE FOR EVALUATING and reporting on a company’s controls. The external auditors are responsible for auditing management’s assertion and independently coming to their own conclusions about the company’s internal control effectiveness. They must evaluate management’s assessment and also perform their own, independent tests in many areas,
Disclosure
TThe SEC changed—and proposed further modifications to—its mutual fund rules and forms ( www.sec.gov/news/press/2004-16.htm ). In one action, to improve funds’ disclosure of costs, investments and performance, the commission amended provisions pertaining to shareholder reports and quarterly portfolio disclosures. These new requirements will apply to reporting periods ending on or
The Importance of IRD
EXECUTIVE SUMMARY CPAs MUST EXERCISE CAUTION TO CAPTURE CORRECT income in respect of the decedent (IRD) deductions on clients’ returns. Since clients typically don’t understand the issue well enough to volunteer the existence of IRD, CPAs must make sure they ask clients the right questions to elicit the information they
Features
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Five years ago, a grieving Angel Zhen started his own CPA firm with no clients and no revenue. Today, he has 300 clients, $600,000 in revenue and 12 weeks of annual vacation. In this JofA article, he shares how he set up his firm and how you could do the same.
From The Tax Adviser
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Current developments in taxation of individuals: Part 2
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