Financial experts have a challenge, now and into the future, of separating out the effects of the once-in-a-lifetime COVID-19 economic disaster when expressing an opinion about lost profits, lost earnings, or other related damages in litigation matters, insurance claims, and other applications requiring financial forecasting.

When thinking about due diligence in a merger or acquisition context, we tend to think about it solely from the buyer’s perspective. Perhaps you have a picture in your head of a team of lawyers, CPAs, and other experts combing through financial records and legal documents, searching for potential liabilities or areas of risk that the buyer soon will be inheriting as their own. Depending on the size of the transaction, this process can take weeks, or even months. The seller often discovers the literal torment of “sleepless nights,” finding themselves in a period of limbo hoping that no major issues exist that could delay or terminate negotiations.

Recruiters and interviewers use check-lists to identify the skills and attributes of the ideal candidate. You should do likewise. What type of organization, team, culture, and situation comprise your ideal role? Then, craft interview questions of your own, customized to the circumstances and within the context of what you learn from your research.

I can’t tell you how many times I’ve heard “We’re a relationship business.” Certainly more times than I can count during the 20-plus years I’ve worked with CPA firms. It’s seemingly the one constant in an ever-changing profession. Recently, though, I wonder if we’ve actually devalued relationship building.

As the saying goes, “There is no friend like an old friend.” The same can be true in your professional life as long-standing client relationships are often the most satisfying. They reinforce what it means to truly be a professional, guiding and advising clients across the arc of their working lives and, ideally, seeing them achieve financial security and peace of mind.

This column looks at the essentiality criterion and its development, from GASB Concept Statement No. 3, to the original exposure draft, and now the revised exposure draft.

In this issue: Pa. House Bill to Align Local Tax Filing Deadlines; Pa. Treasurer, Legislators Introduce Retirement Savings Plan; EITC/OSTC Proposals Approved by Pennsylvania Senate; and more.

Those in governmental administration are entrusted with effectively managing and deploying taxpayer funds for the advancement of the communities in which they serve. Ethical practices are paramount to good governance, and ethics in government have never been more relevant than they are right now.

Any discussion of state corporate income tax apportionment formulas should always include the topic of “alternative apportionment.” In this column, Jonathan Liss explains the concept of alternative apportionment and the purpose of this statutory relief mechanism.

In this issue: Pa. Lawmakers Return to Wrap Up 2021; PICPA and NJCPA Convene Joint Meeting; Live Pennsylvania DOR Update; and more.

Changes to the nation’s tax system are on the horizon, and one of the biggest impacts will likely be a reinvigorated, well-funded IRS. And a well-funded IRS certainly means an increase in IRS audits. Businesses and high-income individuals would be well-advised to get their houses in order ahead of a potential wave of aggressive IRS reviews of tax returns and the consequent audits.

For auditors, material misstatements are the enemy. If they sneak in without detection, we fail. Maybe they enter in by error, other times on purpose: it doesn’t matter. They often secret themselves in myriad places: receivables, equity, inventory, payables, investments, or a debt disclosure, just to name a few.

In this issue: Report Examines Pa.’s Economic Development Incentives; Gov. Wolf Acts to Help Tipped Workers; Pennsylvania House Hearing Looks at Supply Chain Strain; and more.

Pennsylvania has a vast wealth of natural resources: minerals, coal, stone, forests, and, of course, natural gas and petroleum. This abundance can result in an economic benefit for property owners as well as for those who develop, mine, and harvest such resources.

Beginning in 2018, public engineering and construction companies must comply with extensive revenue-related disclosures required under ASC 606, Revenue from Contracts with Customers. Beginning in 2019 (years beginning after Dec. 15, 2018), nonpublic engineering and construction companies issuing GAAP-basis financial statements must also comply with expanded revenue-related disclosures. While the Financial Accounting Standards Board has provided all nonpublic companies with practical expedients that significantly reduce the quantity and detail of these new disclosures, the revenue-related disclosures for nonpublic companies will still present challenges.

In Revenue Procedure 2018-44, the IRS modified Revenue Procedure 2018-31 to add temporary rules for corporations changing from a cash to an accrual method of accounting in connection with revoking S corporation status.

In Adam Smith’s The Wealth of Nations: Book V, he proposed that there are four elements necessary for a good tax system: fairness, certainty, ability to pay, and administrative simplicity. Certainty, which refers to a taxpayer knowing when, how, and what to pay, is paramount to a good tax system. The AICPA also cites certainty as a guiding principle in its Tax Policy Concept Statement No. 1, whereby “[t]he tax rules should clearly specify how the amount of payment is determined, when payment of the tax should occur, and how payment is made.”

Entrepreneurs work hard to make their businesses succeed, and they often have a large percentage of their personal wealth embedded in those businesses. When they begin to contemplate retirement, it is important to maximize the net proceeds from the sale of their business to provide sufficient resources to support their retirement.

The CPA Evolution initiative, a joint project between the National Association of State Boards of Accountancy (NASBA) and the AICPA, was created to transform the CPA licensure model. It was undertaken to embrace the changing skills and competencies required of CPAs, today and into the future.

Have you ever produced financial statements that you reported out at a monthly management meeting only to be met by blank stares on the faces of those without a financial background? It can be unsettling, but it can be overcome. To break through those blank stares, you have to tell the financial story of your organization in a meaningful way to those with diverse backgrounds and varying levels of financial knowledge.