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. 185, No. 3, March

A CPA's Skills, an Agent's Badge
The office belonging to the head of the FBI's Washington field office sports a memento of one of his past jobs: a sign identifying Tom Green as the controller of the Olympic Construction Co. However, "Tom Green" was the nom de guerre of FBI special...
An International Accent: One Firm Took a Radical Turn from Traditional Services to a Focus on the Latin American Market
What an a firm do in the face of increasing competition for traditional services clients? Sotomayor & Co., a 14-person firm in Southern California, transformed its practice to take advantage of the opportunities available to CPAs who understand...
A Premium Choice: Today's REITs Differ Radically from Their Predecessors of 20 Years Ago
"Many ordinary investors are still confused about exactly what a real estate investment trust (REIT) is," says Kit Case, senior equity REIT analyst for Southwest Securities, Inc., summing up the calls he receives. On the other hand, Case says more...
ASB Finalizes Assurance-Related Statement
The need for assurance in areas outside of financial statements is cropping up everywhere. To increase the scope of attestation engagements to financial information outside the financial statements, such as to management's discussion and analysis...
Boost for Performance Reporting
The GASB received a three-year grant to research and develop performance-reporting techniques that will make it easier for citizens, elected officials and other financial report users to better understand the results of their governments' operations....
Demutualization and Tax Deductions
UNUM Corp. is the product of a demutualization--when a mutually owned institution converts to a stockholder-owned company. UNUM was set up to be the owner of the stock of a new company (UNUM Life Insurance Co.) formed as a result of a conversion by...
Earned Income Credit (EIC) Eligibility Checklist
For use by income tax return prepares 1997 tax returns and claims for refund. Taxpayers may claim the EIC it all the following questions are answered yes. Yes No 1. Do the taxpayer, spouse...
Employer-Provided Employee Meals
Employers in certain businesses and industries that provide employees with meals during the workday can deduct the costs of those meals if they are ordinary and necessary business expenses. As a rule, the IRS limits the business meals deduction to...
GAO Says IRS Needs More Financial Status Audit Guidance
What type of car do you drive? How much money is in your bank account? Let me know a little more about your credit card debt. These are the kinds of questions asked during an IRS financial status audit--an audit the IRS uses to identify unreported...
Grown from the Soil of Hard Necessity: Grass-Roots Members Voice Their Opinions on the Visioning Process
Grass roots--(c. 1880) The very foundation or source; basic; fundamental; society at the local level as distinguished from the centers of political leadership. Successful revolutions are seldom driven from the top down but emanate instead from the...
Guide to Accounting Software: The Pluses and Minuses of Nine Leading Mid-Price-Range Products
The switch by most CPAs from DOS to the Windows environment occurred so quickly that our most recent review of the leading DOS-based accounting software, published only three years ago (JofA, Feb.95, page 37), was essentially obsolete a year after...
Internal-Use Software and the Research Credit
Taxpayers who claim the incremental research credit, particularly for internal-use software, must meet a new "discovery" test. In United Stationers, Inc. v. United States (no. 92 C 6065, N.D. Ill., October 17, 1997), an office products wholesaler...
Internal-Use Software Statement Issued
Accounting practices for the costs of software used internally have been diverse, but a new SOP from AcSEC brings consistency to this multibillion dollar niche. Accounting for the Costs of Computer Software Developed or Obtained for Internal Use requires...
Making College More Affordable: The Education Provisions of the Taxpayer Relief Act of 1997 Can Help
Thanks to the Taxpayer Relief Act of 1997, families with college-bound students (parents included), can take advantage--starting this year--of a variety of new tax benefits. These include the Hope scholarship and lifetime learning credit, the education...
Marketing Clinic: How to Keep Clients Coming Back
Many CPAs are unhappy with their client relationships. They complain that the clients do not follow their advice but then say they are dissatisfied with the outcome of an engagement. The CPAs don't feel they ever get their points across. Sound familiar?...
On the Wave of a New Industry: Small Companies Have Always Relied on CPAs, but a Growing Business Adds a New Twist to the Relationship
CPA David Bass has entered a fast-growing industry that is well suited to an accountant's training and abilities, the field of professional employer organizations (PEOs). PEOs work mainly with smaller companies, taking on the administrative burdens...
Revised Ethics on Confidentiality and Low-Balling
The International Federation of Accountants has revised its Code of Ethics for Professional Accountants to include information on the disclosure of confidential information, underbidding competitors and employing nonaccountants. The ethics code also...
SEC Urges Year 2000 Disclosure
The Securities and Exchange Commission is requiring companies to disclose substantial year 2000 (Y2K)-related computer costs. In staff legal bulletin no. 5, issued in January, the SEC Divisions of Corporation Finance and Investment Management said...
Sizing Up Your Company's 401(k) Plan
While there is no "typical" 401(k) plan, surveys have identified some key features that many plans have in common, including eligibility, contribution matching, investment options and withdrawals. Here are some questions employers and employees can use...
Talking with the Auditor: New Management Representation Rules Give Some Options and Also Aim for Consistency
The Institute's guidance on client representations had a good 20-year run, but it's been replaced by a new model with a few changes and even some custom features. The new SAS no. 85, Management Representations, supersedes SAS no. 19, Client Representations,...
The 15th World Congress of Accountants: Service to the Public Is Primary
Last October, as they have done almost every five years since the first event in St. Louis in 1904, accountants from all over the globe assembled for the World Congress of Accountants--this time in Paris. As the 6,000 participants from more than 100...
The Business of Barter: What an Accountant Should Know about It
In today's business world, barter, one of the oldest forms of trade, has been transformed into a sophisticated way of doing business. As a result, barter exchange networks, the clearinghouses for those wishing to barter, have flourished. And as more...
The E Team: Electronic Commerce Means Knowing the Business Behind the Web Site
In a small town in the Midwest, someone is trying to sell auto parts out of his garage. In New York, a multinational corporation is trying to reach customers from Melbourne to Milan. And both are turning to electronic commerce (e-commerce) to reach...
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