• Week Ending March 19, 2021

    Mar 19, 2021
    In this issue: Pa. Extends State Tax Filing Deadline; PICPA-Backed Advisory Opinion Bill Advances; Pa. Senators Announce Proposals to Help Small Businesses; and more.
  • Failure to Design Audit to Detect Fraud Can Lead to Liability

    Mar 16, 2021
    On Dec. 28, 2017, a federal court in Alabama ruled in favor of the Federal Deposit Insurance Corporation in a case against PwC arising from a bank failure after a massive fraud was discovered between a bank and one of its customers. This was the second case against PwC related to the failure of Colonial Bank.
  • The Practice of Accounting vs. the Practice of Law

    Mar 16, 2021
    There is considerable disagreement between CPAs and attorneys as to exactly what CPAs can do in the area of advice and what constitutes the practice of law – especially since “practice of law” is a nebulous term without clear definition. Most of the disagreement often seems to come to a boil in the area of tax practice. The situation hasn’t been helped or made any clearer now that many big firms employ lawyers who prepare tax returns.
  • Watch Out for New Rules on Recognizing Other Income

    Mar 16, 2021
    Much has been publicized about new revenue recognition standards, but it is important to note that there also are new rules for “other income,” based in part on principles within Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers.
  • Internships: A Golden Opportunity from Three Different Angles

    Mar 16, 2021
    Comb through the many benefits of accounting internship programs for students, schools, and employers. This article goes into detail about best practices for a successful internship program on campus and discusses the results of a recent Rider University study on what students feel they got out of their own firm internships.
  • Week Ending March 12, 2021

    Mar 12, 2021
    In this issue: PICPA Presents Fiscal Responsibility Report to Legislature; Greiner, PICPA Seek to Change Pa. Corporate Tax Due Date; Pennsylvania DOR Offers Guidance on Home Office Expenses; and more.
  • Week Ending March 5, 2021

    Mar 05, 2021
    In this issue: PICPA Fiscal Responsibility Task Force Report; Pa. House Appropriations Concludes Budget Hearings; Elimination of Pennsylvania Net Operating Loss Expiration; and more.
  • Finding Opportunity Beyond Obstacles

    Mar 01, 2021
    Hard to believe, but we are one year into the COVID-19 pandemic. I don’t think any of us imagined at the beginning the impact the virus would have on so many. From the accounting profession’s perspective, the pandemic accelerated the use of technology to allow for the continuance of services. From PICPA’s perspective, the virus demanded the same broad use of technology and flexible work arrangements that our members were experiencing, but it also forced us to review how we engage members.
  • Tax Proposals Could Dominate Legislative Session Early

    Mar 01, 2021
    The 205th Pennsylvania General Assembly was seated Jan. 5, 2021. Swearing-in day, typically a festive affair, had a decidedly different feel, and not just because of restrictions brought on by the pandemic.
  • Get Ready for Changes to Employee Benefit Plan Audit Opinions

    Mar 01, 2021
    The AICPA Auditing Standards Board (ASB) issued a new opinion and reporting standard for employee benefit plan audits. SAS No. 136, Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans, addresses the auditor’s responsibilities to form an opinion on the financial statements in addition to the form and content of the report issued as a result of an audit of the financial statements.
  • CPA Exam Changes on the Way

    Mar 01, 2021
    Factors such as specialized core competencies, expanded CPA skill sets, and advancing technology are bringing significant changes to the CPA Exam. According to the AICPA, the percentage of nonaccounting graduate degree hires in public accounting firms increased from 20% in 2016 to 31% in 2018. This reflects how the evolving business environment is affecting the profession and the CPA licensure model.
  • U.S. Businesses Must Be Aware of VATs and What the Responsibilities Are for These Taxes

    Mar 01, 2021
    Value-added taxes, which have gained wide acceptance throughout the world, have many complexities for U.S. businesses that may be unfamiliar with this type of levy. Understanding key aspects of the tax can help to boost the bottom line and mitigate or eliminate potential liabilities.
  • A Closer Look at GASB’s Proposed Financial Reporting Model

    Mar 01, 2021
    The Governmental Accounting Standards Board’s (GASB) Financial Reporting Model Improvements exposure draft, issued in June 2020, proposed new requirements for key components of the Comprehensive Annual Financial Report (CAFR). The new model eliminates the modified accrual basis of accounting used by government funds and replaces it with what is called the short-term financial resources measurement focus and accrual basis.
  • Thoughtful Professional Collaborations Can Bolster Your Common Client’s Success

    Mar 01, 2021
    The financial plan roadmap typically covers strategies for income planning, wealth management, tax minimization, legacy planning, and more. Leveraging all these capabilities requires a “big-picture perspective.” For many CPA firms, particularly smaller firms, integrating the services of other professionals will enhance and support this holistic approach.
  • Who Is Sitting for the CPA Exam and Why?

    Mar 01, 2021
    The AICPA’s Private Companies Practice Section consistently finds that the recruitment of qualified staff is a top concern for CPA firms. In its 2019 Trends in the Supply of Accounting Graduates and the Demand for Public Accounting Recruits, the AICPA reports a decline in CPA candidates, yet the U.S. Bureau of Labor Statistics projects employment for accountants and auditors to grow by 6% from 2018 to 2028. These opposing trends have important implications for the public and profession, especially considering the high number of CPAs expected to retire soon.
  • Five Ways to Enhance Your Banking Relationships

    Mar 01, 2021
    Financial services are critical to the long-term viability of an organization, yet the global pandemic and the resulting economic uncertainty presents a challenge even to the most well-established banking relationships. Over the past year, lenders and borrowers contended with the introduction, and regulatory evolution, of new federal programs – such as the Paycheck Protection Program – and the frustrations of maintaining operations amidst public health regulations. Here are a few tips for fostering productive communications with your lender during difficult times and beyond.
  • How to Respond to Comfort Letter Pressures

    Mar 01, 2021
    Pressures are put on CPAs from many sources. An unfortunately common source is from banks and other lenders pressuring them to provide assurance regarding a client’s financial strength. Many CPAs have shared their frustrations regarding veiled threats from aggressive brokers and lenders, alleging that the CPAs’ clients will not qualify for a loan without receiving a letter supporting the clients’ loan qualifications. Some brokers even suggest that the client should seek a “more cooperative” CPA.
  • IRC Section 1031 and Real Estate Like-Kind Exchanges

    Mar 01, 2021
    Owners of investment property are acutely aware of the double-edged sword that awaits a sale. The owners will finally be able to realize the benefit from years of hard work maintaining the appreciated property, but they also could face a substantial tax liability on the sale of the investment property. For taxpayers who wish to continue holding an investment rather than cashing out, Internal Revenue Code (IRC) Section 1031 provides a strategy that allows for tax deferral whereby the taxpayer exchanges the investment property for like-kind property. There have been some major changes to Section 1031 in recent years. Notably, the Tax Cuts and Jobs Act (TCJA) made only exchanges of real property eligible for Section 1031 exchanges, and the Treasury Regulations that were issued in November 2020 provide a revised definition of real property for purposes of Section 1031. However, understand that President Joe Biden’s tax plan, mentioned during the 2020 election, referenced eliminating tax breaks for real estate investors; thus, Section 1031 could be eliminated as a strategy in the future
  • Audit Opinions: Changes from Numerous ASB Statements

    Mar 01, 2021
    The AICPA Auditing Standards Board (ASB) issued SAS No. 134, Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements in May 2019. It was originally effective for audits of financial statements for periods ending on or after Dec. 15, 2020, but implementation was delayed for one year until Dec. 15, 2021.
  • Complexities Abound for Pass-Through Entities and SALT Deduction Work-Arounds

    Mar 01, 2021
    The Tax Cuts and Jobs Act of 2017 (TCJA) reformed many aspects of the Internal Revenue Code of 1986, but the $10,000 state and local tax deduction limitation (SALT cap) has remained one of its more controversial aspects. The SALT cap prevents many individuals from being able to fully deduct their state and local income and property taxes on their federal individual income tax returns. This is further exacerbated for individuals filing in multiple states through their ownership interests in partnerships, S corporations, and certain limited liability companies.
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