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. 75, No. 6, June

Advantages of Human Resources Outsourcing
Integrated human resources service providers, known as human resources outsourcers (HRO) or professional employer organizations (PEO), can provide more and less in the right circumstances: less as in less liability, lower fees, and smaller benefit hikes,...
An Overview of Tax Audits in Russia
Russia presents many difficulties for foreign businesses. Nevertheless, Russia is attractive for entrepreneurs. Many market niches are unoccupied; organizing a new business is relatively inexpensive; and foreign investment is encouraged.Dealing with...
Asset Based Finance: Proven Disciplines for Prudent Lending
Asset Based Finance: Proven Disciplines for Prudent Lending By Gregory F. Udell Published by Commercial Finance Association, 2004; ISBN 0-9667943-2-X 283 pages; $79.95 (hardcover)This book, designed as a textbook for the lending industry, is directed...
Audit Documentation: It's a Whole New World
"The skill of an accountant can always be ascertained by an inspection of his working papers."- Robert H. Montgomery, Montgomery's Auditing, 7972Montgomery's Auditing was the primary source for auditors about the purpose and content of audit workpapers...
Consolidation and Competition in Public Accounting
An Analysis of the GAO ReportThe Sarbanes-Oxley Act of 2002 (SOA) charged the General Accounting Office (GAO, which changed its name to the Government Accountability Office in 2004) with examining the factors underlying audit mergers in the 1980s and...
CPAs' Perceptions of the Impact of SAS 99
In November 2002, the Auditing Standards Board (ASB) issued Statement on Auditing Standard 99, Consideration of Fraud in a Financial Statement Audit. Although SAS 99 was developed before the recent accounting scandals, its release came in their wake....
Document Destruction and Privacy Protections
CPAs have a legal obligation to have client records properly destroyed, or they may find themselves in direct violation of the 1974 Federal Privacy Act. An on-site document destruction company to destroy end-of-retention files can supply effective legal...
Does Being the Auditor Impair Independence?
The cornerstone of the audit (attest) function is auditor independence. In the wake of recent accounting scandals, one area that has received a lot of attention is whether nonaudit services to audit clients would automatically impair independence by...
Examining the Future of Broad-Based Options
Sometime in 2005, domestic and international companies can expect to be required to show charges to earnings for all their equity compensation plans. Currently, under Accounting Procedure Bulletin (APB) 25, companies do not have to show charges to earnings...
Expansion of Merger and Consolidation Provisions
In IRC section 368(a)(1)(A), the term "reorganization" includes a "statutory merger or consolidation." No restrictions are placed on the type of consideration used, even permitting money to be exchanged, as long as the continuity-ofinterest requirement...
FASB Interpretation 46(R): Consolidation Required in Unexpected Situations
Where you find the laws the most numerous, there you will find also the greatest injustice.-ArcesilousAs the Enron crisis unfolded, the Jedi and Raptors, first introduced as the heroes and villains of fantasy movies, came to symbolize massive corporate...
Financial Advisers and Planned Giving: Doing the Right Thing
High-net-worth individuals have been scrambling to find ways to donate funds to charity without the problems and setup costs of traditional charitable planning vehicles. With the generational transfer of wealth over the next 50 years estimated at $40...
Fixing the Income Tax: Transparency and Simplicity
The goal of the SET system is to eliminate complex issues through which the system might unfairly and unintentionally penalize taxpayers.The federal income tax has always been an area of public policy where the CPA profession can make a valuable contribution....
For Whom Do We Account?
In Senate Banking Committee healings in 1932, a revelation galvanized public opinion in support of federal regulation of securities offerings, securities exchanges, and banks: Between 1924 and 1929, executives of the National City Company (NCC) had manipulated...
How Does the Push for Ethics and Accuracy Affect Valuations and Appraisals?
Despite the emphasis on ethics and accuracy in the current business environment, opportunities for creativity and artistry remain when it comes to valuations and appraisals. Despite increasing demands for standardization, valuation remains more an art...
Inbox: Letters to the Editor
Fixing Social SecurityEric Rothenburg's article in April ("Social security: A Macroeconomic Issue") was an excellent summary of the situation. It proposed solutions in accordance with the problem of demographics, something that privatization does not...
International Shipping Industry Benefits from Recent Tax Changes
Despite its continuing importance, the shipping industry has lost most of the prestige it held in this country. One reason is that although several U.S. shipping companies are publicly traded, the nation is less well represented in international shipping...
Now Is the Time for Ethics in Education
Recent corporate accounting scandals have brought ethics back into the limelight. The sight of CEOs and CFOs parading into courtrooms has raised public awareness and concern about ethical behavior in management and accounting. The Wall Street Journal...
Offshore Outsourcing of Tax-Return Preparation
Promising Business Opportunities and Professional StandardsOutsourcing business processes overseas is increasingly common in the banking, financial services, retailing, insurance, and telecommunications sectors. Economists and accounting professionals...
Private Nonoperating Foundations and Supporting Organizations
Many charitably inclined individuals form private nonoperating foundations (PNOF) funded with long-term qualified appreciated stock (QAS). QAS includes any stock that is capital gain property and for which market quotations are readily available on an...
Reflections on the NYSE and the 'Grasso Affair'
Even though the recent events at the New York Stock Exchange (NYSE) surrounding the departure of Chairman Richard Grasso raised the possibility of important reforms, the current and proposed structural changes within the exchange will be insufficient...
Rethinking the 'Responsible Person' Penalty
One benefit of the corporate form of business is limited personal liability. A corporation may file for bankruptcy and have debts canceled by the court. A discharge in bankruptcy precludes a creditor from pursuing collection from corporate managers or...
Section 1031 Exchanges: Underused Tax-Planning Tool
IRC section 1031 provides that "no gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment if such property is exchanged solely for property of like-kind which is to be held either...
The Focus of Future PCAOB Auditor Inspections
While the Public Company Accounting Oversight Board (PCAOB) inspections of 2003 were limited to a few dozen engagements of the Big Four accounting firms, the PCAOB is in the midst of conducting full-scale inspections of not only the Big Four but also...
Toward Improved Internal Controls
Early Remediation Actions DisclosedCompanies that successfully implement the Sarbanes-Oxley Act of 2002 (SOA) will likely identify weaknesses in internal controls over financial reporting and remediate those weaknesses with enhanced internal controls....
Website of the Month: Freed Maxick & Battaglia, PC
Note: This column periodically reviews websites for some of the larger public accounting firms, as well as for smaller firms that have particularly good sites.Freed Maxick & Battaglia, PC, is the largest local public accounting firm based in Buffalo,...

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