Journal of Accountancy

A monthly publication of the American Institute of Certified Public Accountants focusing on the latest news and developments related to the field of accounting, and written for CPAs and other accounting professionals.

Articles from Vol. 177, No. 6, June

A Case against Financed Home Ownership
Home ownership no longer provides the tax shelter benefits it once did. Although home mortgage interest remains deductible as an itemized deduction, the economic benefits of financed home ownership declined significantly over the past decade. Three...
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Accounting Education
We offer a seminar in accounting topics that's the capstone course for our M.S. in accounting program. Students are required to find a real-world accounting problem at a local business, create a game plan and present the solution before an audience...
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Amortizing Intangibles - a Break-Even Analysis
The Omnibus Budget Reconciliation Act of 1993 (OBRA) included a long-awaited change in the way intangible assets are amortized: Deductions are allowed for most intangibles, including goodwillgoing concern values, over a 15-year amortization period....
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Change the Single Audit Requirements
The Single Audit Act of 1984 needs to be revised. Even though the act provides better audit coverage than the previous grant-by-grant method of auditing federal programs, changes still are needed. Almost 10 years of experience show dollar thresholds...
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Chenok Will Not Seek Reelection as AICPA President
After 15 years in office, Philip B. Chenok will step down as American Institute of CPAs president when his current term expires on June 30, 1995. Chenok told the Journal he approached the end of his term with mixed emotions. "On the one hand," he...
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Court May Not Stop Withholding on Australian Lottery Winners
The International Lotto Fund of Australia participates in lottery games worldwide on a large scale. The fund won a lottery jackpot prize of more than $27 million from the Virginia state lottery. The state lottery department said it would withhold 30%...
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Employee Discounts
One fringe benefit that makes good business sense for many companies is offering employees discounts on the employer's goods or services. As long as such discounts follow certain rules and meet certain criteria, they are tax-free and employees do not...
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Entry-Level Software: Friend or Foe? Installing and Supporting the Programs Are Ways to Generate New Business
When inexpensive accounting programs first came on the market a few years ago, many CPAs dismissed them as useless computer toys. Indeed, many of the early versions were technically flawed and certainly not sufficiently robust to replace an accountant--let...
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ESOPs Provide Unique Tax Benefits
Publicity generated by the proposed $5 billion employee buyout of at least 53% of UAL Corp. stock using an employee stock ownership plan (ESOP) drew attention to the tax benefits available to sponsors of such plans. Typically, an ESOP is established...
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Hidden Traps in Document Requests
CPAs often are asked to respond to requests for documents in lawsuits to which they may or may not be parties and in other circumstances. When they comply with such requests automatically, they may expose themselves unwittingly to both legal and practical...
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Local Area Statistics: A Practice Development Tool
CPA firms that simply compare client data tracked in annual audits (debt/equity ratios, for example) with prior-year or budgeted amounts are missing a marketting opportunity. Gathering similar information from local businesses in the same industry...
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Saving for Retirement Begins Earlier
U.S. workers are starting to save for retirement at an earlier age. According to a survey of 1,000 workers conducted for the Employee Benefit Research Institute, the median age at which workers started saving for retirement was 30, and the median amount...
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Selecting the Right Mortgage
Because most home buyers finance their purchase, many turn to their CPAs with questions about mortgage products and financing options. How can prospective buyers determine which mortgage products are right for them? What are the advantages and disadvantages...
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Test Your Knowledge of Professional Ethics
INTEGRITY AND OBJECTIVITY 1. Must a member in industry disclose material or relevant information to his or her employer's external accountant even if the accountant did not request such information specifically? Yes No 2. If a member...
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The Consumption-Based Income Tax
Many tax-simplification advocates say just amending current laws doesn't go far enough and call instead for a major overhaul of the tax system. One reform many policy experts advocate is introducing a consumption-based tax system. Such a tax could...
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The Home Office Revisited
Last year in Commissioner v. Soliman (113 S.Ct. 701, 1993), the U.S. Supreme Court denied an anesthe-siologist a home office deduction because he worked at several nearby hospitals--even though none of the hospitals provided him with an office. (See...
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