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. 69, No. 1, January

Additional Audit Interpretations Issued in 1998
T he October issue of The CPA Journal presented a number of audit interpretations issued by the Auditing Standards Board in 1998. Here are descriptions of two other interpretations. The full text is available on the AICPA's website, www.aicpa.org. AU...
Alternative Forms of Practice: More Than Just American Express
FIRMS ARE LOOKING FOR WAYS TO CREATE ONE-STOP SHOPPING FOR CLIENTS AND FUND CAPITAL EXPENDITURES AND RETIREMENT BENEFITS. IN BRIEF rime to Explore All the Options The arrival on the accountancy scene of public companies intent on acquiring CPA firm practices...
Alternative Practice Structures
he traditional CPA firm, performing the full range of services that CPAs offer to the public, is being tested. Is it the best form to use when offering personal financial planning, tax or business consulting, and even tax return preparation services?...
Conversion of Apartment Buildings May Be Subject to New York City Unincorporated Business Tax
Generally, the income from holding, leasing, or managing real property is not subject to the New York City Unincorporated Business Tax (UBT). However, as noted in the following case, the original purpose of the use of real property can change upon the...
Cost Capitalization Developments
The Tax Court recently handed two cost capitalization victories to the IRS. In FMR Corp. and Subsidiaries v. Comm'r, 110 T.C. 402 (1998), the court concluded that an investment management company was not entitled to current deductions for costs incurred...
Cost of Capital: Estimation and Applications
COST OF CAPITAL: ESTIMATION AND APPLICATIONS By Shannon Pratt, John Wiley di Sons, Inc., 1998 Do you know how to estimate the cost of capital of an enterprise? The estimation methods and techniques can be somewhat complex and require subjective reasoning...
Federal Rules of Evidence and the Financial Professional: Greater Control in the Courtroom on Testimony by Experts
GREATER CONTROL IN THE COURTROOM ON TESTIMONY BY EXPERTS PAs and consultants are increasingly requested to act as expert witnesses at trials and in other dispute resolution forums. They give testimony on financial and business transactions and on damages...
Gifting Limited Partnership Interests: Are Annual Exclusions Available?
THE ANNUAL GIFT TAX EXCLUSION may be insignificant compared to the entire value of the partnership. or the last few years, one of the most common wealth preservation techniques has been gifts of interests in limited partnerships. In addition to valuation...
IRS Looking at Creative Incentives for E-Filing
he IRS has long known that the future of the U.S. tax compliance system lies in electronic filing. E-filed returns are vastly cheaper to process and have a dramatically reduced error rate. The IRS Restructuring and Reform Act of 1998 (IRSRRA) added additional...
Issues in Managing the Multinational Corporation
Companies entering the international business arena often face two sets of operational and strategic issues. The first set includes issues that are familiar to them in a domestic setting but that take on new dimensions in the global realm. The second...
Legislating Professional Standards at the State Level
State boards and state CPA societies throughout the nation are, as has been well reported, diligently considering the third edition of the Uniform Accountancy Act. As part of the process, various aspects of the proposal are being debated. Although there...
Life Insurance Planning
In planning an estate, life insurance proceeds can be excluded from the gross estate if the insured does not have incidents of ownership. This will also apply to the spouse's estate, if the spouse is the beneficiary of the insurance. To accomplish this,...
Medical Student Loans: Making Repayments Tax Free
he bulk of many new physicians' and nurses' debts may consist of student loans. To alleviate this student loan repayment burden, some health care workers may convince their employers to pay off these loans. The tax consequences of these student loan...
Minor Acts of the Taxpayer Relief Act of 1997
legislation in 1997 brought about major, highly-publicized changes. The Taxpayer Relief Act, signed into law August 5, 1997, contained more than 800 amendments and more than 300 new provisions, adding 800 pages to the IRC. High profile areas of the legislation...
Out-of-State Purchasers' Use of Resale Certificate Form ST-120
On June 5, 1998, the New York State Tax Department issued TSBM-98(3)S, which changes the requirements for use of Sales Tax Resale Certificate Form ST-120 by qualified outof-state vendors not registered in New York State. Previously Form ST-120 could...
Payment Processing in Electronic Commerce
One of the thorniest issues in the realm of e-commerce is how to provide secure channels for the processing of payments. The explosive growth that had been predicted has been somewhat dampened by the technical problems of paying for goods purchased on...
Perceptions in the Recruiting Process
Do students and faculty know what characteristics recruiters are looking for? Public accounting firms spend significant amounts of time and money recruiting college graduates for entry-level accounting positions. Human resource directors of national...
Recommended Changes to the UAA
The third edition of the Uniform Accountancy Act, as developed bv the AICPA and the National Association of State Boards of Accountancy (NASBA), sets forth the services that only licensed CPAs (and in some jurisdictions) public accountants can provide....
Riskview: A No-Cost Facilitator of Financial Planning
The Dow Jones Industrial Average has experienced accelerating volatility during recent times. The increased volatility has investors contemplating portfolio changes to reduce risk and achieve their long-term objectives. They are facing confounding questions...
SAS No. 85-Management Representations
AS No. 85, Management Representations, supersedes SAS No. 19, Client Representations, and Auditing Interpretation No. 2, Management Representations When Current Management Was Not Present During the Period Under Audit. The new SAS now incorporates the...
SEC Amends Rules of Practice
Under Rule 102(e) of the Rules of Practice, accountants, lawyers, and other professionals may be censured, suspended, or barred from practicing before the SEC. Rule 102(e) is a "means to ensure that those professionals, on whom the [SEC] relies heavily...
The IRS Restructuring and Reform Act of 1998
In Brief Responding to Abuses by the IRS The IRS Restructuring and Reform Act of 1998 is a reaction to the widespread disillusionment with the tax system, as documented during the fall 1997 Senate Finance Committee hearings on abuses by the IRS. The...
Will Poolings Survive?
In Brief Getting in Under the Wire Mega-mergers have been announced in waves in 1998. These large combinations span various industries, but many are structured to achieve pooling-of-interests accounting (pooling). The pooling method of accounting seems...