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. 62, No. 4, April

Accounting for Income Taxes - SFAS 109
Earlier this year, the FASB issued SFAS 109, "Accounting for Income Taxes," effective for fiscal years beginning after December 15, 1992, with earlier adoption encouraged. This statement supersedes SFAS 96 (and several other pronouncements) issued in...
A 'New Look' in Estimated Tax
New York State Tax Commissioner James W. Wetzler recently announced a new experimental program designed to simplify the processing of tax returns for the approximately 600,000 New York taxpayers who make estimated tax payments.In February 1992, estimated...
Back Pay Taxed in Racial Discrimination Case
In the last four years, there have been several Tax Court and Court of Appeals cases that have applied IRC Sec. 104(a)(2) personal injury exclusion to awards made under federal race, sex, and age discrimination statutes. In these cases the courts have...
Book Review: Preparing Your Family to Manage Wealth
Preparing Your Family to Manage Wealth deals with the kind of problems individuals approaching their twilight years after a successful career are confronted with: How to pass it on. But busy and pressing schedules--and perhaps bad habits--result in never...
Cracking Down on the Paper Parade
We all like to blame the "system." "If our organization took a good hard look at our record keeping and reporting procedures we'd be able to eliminate so much wasted time and effort." This might be what you are feeling and, rightly so.Many companies...
Deferred Annuities Equals Safety and Tax Advantages
An individually owned annuity is similar to a bank account, except that no income taxes on the interest earned are due until the funds are withdrawn. This tax deferral sets an annuity apart from a similar investment in a CD.For example, suppose you invested...
Employee or Independent Contractor?
Many reasons are offered for misclassification of employees as independent contractors, but the most common appear to be avoiding payment of payroll taxes, fringe benefits, and worker's compensation insurance. The author's scrutiny of 40 court cases...
Fonts-on-the-Fly
Fonts-on-the-Fly solves the compatibility problem of preparing WordPerfect documents on one printer setup and then printing to a Hewlett Packard laser printer. By giving you much of the performance of a Hewlett Packard LaserJet III laser printer on just...
GAAS and the Small Business Auditor Ten Years Later
Nearly a decade has passed since zealous attention was focused on the GAAS application problems encountered by auditors of small business enterprises. AICPA responded with what can be called an "educate and advocate" policy to communicate small business...
Highlights of Final Regulations - Sec. 401(k) Plans; 401(k)
Final Treasury Regulations have been issued under IRC Sec. 401(k), applicable to cash or deferred arrangements (CODAs), employee or matching contributions, and employee elections. The regulations affect plans spanning the period from November 1981 through...
Highlights of Final Regulations - Sec. 401(k) Plans; 401(k) Hardship Distributions - Final Regulations
Final Treasury Regulations have been issued under IRC Sec. 401(k), applicable to cash or deferred arrangements (CODAs), employee or matching contributions, and employee elections. The regulations affect plans spanning the period from November 1981 through...
Medical Flexible Spending Plans
Employers have an opportunity to offer their employees a chance to save taxes on their out-of-pocket medical expenses by instituting a medical flexible spending plan (MFSP) under IRC Sec. 125. Employees can pay for medical costs that are deductible for...
Planning an Audit of an Employee Benefit Plan
The requirement for planning in an audit engagement is covered by the first standard of fieldwork which states that "the work is to be adequately planned." SAS 22, "Planning and Supervision," contains additional guidance.The initial planning for the...
Providing for College Education in the 21st Century
Personal financial planners are being asked to help design college funding plans that will provide funds for children that will attend college after the year 2000.As we approach the 21st century we see our clients more concerned than ever about how to...
Quality Review: Analytical Procedures
(Editor's Note: This article is one of a series focusing on how to improve the quality of practice in your firm by complying with professional standards. The subjects chosen for the series are based upon deficiencies noted during the conduct of Quality...
Revised Report on Internal Control
Eleven months after its original release, the Committee of Sponsoring Organizations of the Treadway Commission (COSO) issued a revised draft of Internal Control--Integrated Framework. The revised draft is being circulated to a limited audience including...
Rules Governing Day Care Providers Eased
Rev. Rul. 92-3 eliminates the need for those who provide day care in their homes to keep records of the specific hours of business use of rooms that are available throughout the business day and which are regularly used for day care, even where the rooms...
Selecting the Best Spreadsheet
With the number of spreadsheet programs available, an accountant is faced with many questions. What is the best spreadsheet? Will my computer support a particular spreadsheet or do I need a new computer? For experienced spreadsheet users, the question...
SFAS 94: Did It Produce Its Intended Effect?
Do changes in accounting standards have economic consequeces resulting from an influence on management behavior? Some observers contend that opposition to a mandated accounting change by corporate management sometimes results in actions to offset the...
Tax Preparer Batting Average Goes "0 for 48" - but What about the Curve Balls?
The results of Money magazine's annual test of tax return preparer's makes especially good headlines, as not one of this year's 48 preparers arrived at the target tax due.Since 1987, Money has asked a group of tax preparers--CPAs, enrolled agents, and...
The Case of the Misdirected Procedures
ABC Co. was an aggressive franchisor whose stock was registered with the SEC. The entity was led by Smith, who was the driving force expansion. The company continued to grow, and earnings were positive. ABC recognized two types of revenue--sales of merchandise...
The Facts about QDOTs: Beware of Estate Tax Traps
The Qualified Domestic Trust (QDoT) may be used for non-US. citizen surviving spouses to defer the loss of significant estate tax benefits savings which have been otherwise eliminated by current law. However, strict adherence to QDoT provisions and proper...
The Minimum Tax Credit: A Full Benefit to Future Years?
In general, the alternative minimum tax (AMT) is meant to limit certain perceived abuses of the regular tax system. On the other hand, the minimum tax credit (MTC) is designed to compensate a taxpayer for any regular tax benefit that is lost in an AMT...
The Revised AICPA Code of Professional Conduct: Current Considerations
In September 1991, members of the AICPA received copies of the recently revised AICPA Code of Professional Conduct (Code). Most of the changes in the Code are the result of an agreement reached by the Federal Trade Commission (FTC) and the AICPA to allow...
Three Secrets of the One-Minute Manager
(EDITOR'S NOTE: Few individuals have impacted the day-to-day management of people and companies as has author, speaker and business consultant Kenneth Blanchard. Best known for his One-Minute Manager Library, including The One-Minute Manager (1982),...
Two Views about the Availability of the CPA Exam - an Open Discussion on a Closed Exam
For many years AICPA has published the text of each CPA exam shortly after its use, together with suggested answers. This material is widely used in coaching courses to prepare candidates for the exam, by accounting educators in preparing their courses,...
Update on State Tax Issues before the U.S. Supreme Court
(Editor's Note: In the March 1992 The CPA Journal, Daniel O'Connell in his article "U.S. Supreme Court Reviews State and Local Taxation Issues," gave the details of three state tax issues presently before the Supreme Court. The following article presents...
Using Stepped-Up Basis on Sale after Spouse's Death
The Connecticut National Bank case (Connecticut National Bank v. U.S., 91-2 USTC (CA-2, No. 90-6310, 6/28/91)) illustrates the relationship between estate tax law and income tax law. In this case, the Second Circuit, in reversing the District Court,...
What's New: Running DOS in Another Environment
I recently had a PC disaster when my PS/2 decided to give up the ghost (the motherboard had a coronary). The PC contained two of my most frequently used applications (Instant Recall and Quicken 5). Fortunately, both were backed up on floppies. No problem....
What's New: TAASCforce Integrated Tax and Write-Up System
The TAASCforce's integrated system consists of the following: Client Accounting System; Depreciation/Amortization System; Service Bureau Payroll System; Information Return System; 1040 Tax System; Business Tax System; 1040 Tax Planning System; and Bank...
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