The CPA Journal

The CPA Journal is a monthly refereed accounting journal. It has been published by the New York State Society of CPAs since 1930.Subjects for The CPA Journal inlcude accountants and accounting. Carolyn Morrisroe is the managing editor and Anthony H. Sarmiento is a contributing editor.

Articles from Vol. 64, No. 8, August

Accounting: A Changing Profession
I started as a junior in public accounting about 44 years ago. A lot has happened over those 44 years. The profession has moved from one operating under broad principles and guidelines to a cook book approach of specific principles for five specific...
A Dagger in America's Heart: Public Policy versus the Family
"Were we directed from Washington when to sow and when to reap, we should soon want bread." This was Thomas Jefferson's assessment of the government's inability to manage agriculture. A similar assessment could be made concerning the American family:...
Book Review: Controller's and Treasurer's Desk Reference
As the author points out, Controller and Treasurer's Desk Reference is written largely to provide assistance to controllers, treasurers, and other personnel in small to medium-sized companies, as well as to newly promoted personnel within the accounting...
Building Rainmakers
New business is the lifeblood of ever successful business. Most companies go out of their way to hire the brightest right out of school. Many of these graduates have spent their nights and weekends studying rather than interacting with their peers in...
Choosing a Living Trust for Estate Planning
Living trusts (a.k.a. inter vivos or self-declaration trusts) may be useful gift/estate planning devices. The use of a living trust in gift/estate planning depends largely on the individual circumstances of the taxpayer. Many of the reasons a living...
Conversion Transactions
With capital gains rates being substantially lower than the maximum ordinary income rate Congress enacted IRC Sec. 1258, effective for conversion transactions entered into after April 30, 1993. IRC Sec. 1258 is intended to prevent the conversion of certain...
Defending against Computer Viruses
In six-month study by the Computer Industry Association of its members, a total of 61,795 infected computers were reported. From five to 816 computers were infected at individual organizations. Among the more infamous viruses were the Pakistani Brain...
Federal vs. States Reasonable Compensation Tug-of-War
RRA '93 lifted the cap on the medicare portion of social security taxes, effective for wages paid on or after January 1, 1994. Accordingly, the stage has now been set for a conflict between Federal and state taxing authorities regarding the appropriate...
FMV of Real Property for NYC Capital Base Computation
In 1984, the Department of Finance issued Policy Bulletin 3-84 regarding the valuation of real property for purposes of the General Corporation Tax.In order to determine the capital base of real property and marketable securities, you would need to determine...
Funded Severance Plans - the New Defined-Benefit Plans
During the past several years, many factors have limited the usefulness of defined-benefit pension plans for the closely held employer. Most readers are aware of legislation restricting benefits, limiting compensation for benefit purposes, and defining...
GAO Takes a Look at the Credit Card Industry
An April 1994 report by the GAO provides interesting insights into the U.S. Credit Card Industry. The report was issued at the request of several congress men concerned about the possible lack of adequate price competition among credit card issuers indicated...
Gifts of Stock to Private Foundations - Window of Opportunity
Historically, the use of a private foundation has provided donors with an excellent vehicle for maintaining continued influence over charitable assets. In 1984, Congress enacted a rule which enhanced the ability of donors to utilize private foundations...
Group Decision-Making
Many managers feel they are well versed in areas of group effort, such as problem-solving, goal setting, and action planning. Frequently, however, the implementation of such techniques never seems to get beyond the initial stage. Often this is because...
Impending Changes in Government Financial Reporting
Although the Comprehensive Annual Financial Report (CAFR) model adhered to by many of the nation's medium-sized and large local governments provides an excellent standard for uniformity and comparability in reporting, it is an overwhelming information...
IRS's Proactive Approach to Electronic Filing Draws Criticism
On May 2, the IRS issued Rev. Proc. 94-34 detailing certain filing requirements for filing 1995 tax returns. In brief, the Service indicated it would only accept Forms 1040 in three formats:* Electronically; filed returns* Computer-prepared Form 1040PC...
NYC General Corporation Tax Based on Capital
One of the alternative methods of calculating the New York City General Corporation Tax (GCT) is the tax on business and investment capital. Book value is used for all assets except marketable securities and real estate, which are valued at fair market...
NY Passes LLC/LLP Bill
The New York State Legislature passed a LLC/LLP bill on July 2 that becomes effective 90 days after Governor Cuomo's signature, which is expected, since he introduced and actively supported the final version of the bill that passed. The bill is likely...
NYS Enforcing Employers' Withholding Requirements
New York State, as with so many other state and local governments, is searching for new ways to generate revenues due to the sluggish economy. As a result, the New York State Department of Taxation and Finance ("Department") has audited and continues...
OBRA's Impact on Securities Partnerships
On August 10, 1993, the Omnibus Budget Reconciliation Act of 1993 (193 Act) was signed into law. As securities partnership may be categorized as a "trader" or "investor" partnership, a distinction that can have a substantial impact on the individual...
Our Profession's "Jurassic Park"
A recent United Nations publications, Management Consulting: A Survey of the Industry and Its Largest Firms (generally referred to as the "UN Survey"), should provide the accounting profession with a "wake-up call," that there is an enormous monster...
Privately Held Companies Report Reasons for Selecting and Switching Auditors
Auditing firms continue to fight over new clients and fend off competitors. The economic slump has only fueled the flames of this scramble for business.Recent research shows companies are putting their work out for bid to a greater number of audit firms....
S Corporations and IRC Sec. 1244 Stock
IRC Sec. 1244 helps small business owners by allowing them to treat certain losses incurred on small business stock as ordinary losses rather than capital losses. Such ordinary loss treatment is generally available to individuals and partners partnerships.A...
Software Revenue Recognition
The central issues in the accounting requirements for computer software revenue are timing and amount. That is, when software is sold or leased, at what point and for what amount should revenue be recognized?A variety of recognition approaches were followed...
The Business of Public Accounting
The profession of public accounting is under attack from all sides. Its members are accused of being "cheerleaders" instead of referees or umpires. Firms are charged with succumbing to competitive pressures resulting in low-balling of fees, shoddy work,...
The Targeted Job Tax Credit
The targeted jobs tax credit, one of the general business tax credits, originated in 1979. Recently, Congress extended the targeted jobs tax credit to include wages paid to individuals who begin work before January 1, 1995. To claim the credit, the employee...
Treasury Finalizes New Tax Practice Standards
Circular 230, the Department of the Treasury document containing the standards used to regulate those persons authorized to practice before the Internal Revenue Service, has been revised in several important respects.Circular 230 has always required...