In 2016, FASB issued ASU 2016-14, Presentation of Financial Statements of Not-for-Profit Entities, effective for fiscal years beginning after December 15, 2017. The standard is…
ICYMI | Opinion: AICPA Proposal Raises the Ethical Bar
Incorporating International Standards into the Code of Professional Conduct
In February 2017, the AICPA's Professional Ethics Executive Committee (PEEC) agreed to propose modifications to the Code of Professional Conduct that would require certain actions…
Update on Hedge Accounting Rules
FASB Addresses Effectiveness Concerns
In 1996, FASB underwent a major overhaul of its accounting rules pertaining to derivative instruments and hedging transactions; except for some minor tinkering, those rules…
In Brief The current upward trend of CPA firm merger and acquisition activity shows no signs of slowing down. CPA firms and individual professionals must…
Changes to Accounting for Employee Share-Based Payment
ASU 2016-09 May Increase Volatility of Diluted EPS
In March 2016, FASB issued Accounting Standards Update (ASU) 2016-09, Improvements to Employee Share-Based Payment Accounting. The new guidance [codified under Accounting Standards Codification (ASC) Topic 718,…
Clarifying Auditors’ Responsibility for Fraud
Commercial Lenders’ Perceptions of Changes to the Audit Report
In Brief The PCAOB recently issued changes to the audit report, one of which explicitly clarifies auditors’ responsibilities for fraud by adding the phrase “whether…
ICYMI | Developing Ethical Leaders for the Accounting Profession
Finding Inspiration from the Coast Guard Academy
The public relies on professionals. Medicine, teaching, law, accounting, the military, the clergy, and public safety, among many others, have all been regarded as honorable…
In November 2014, FASB issued Accounting Standards Update (ASU) 2014-17, Business Combinations (Topic 805): Pushdown Accounting, which became effective immediately. Topic 805 requires that in business combinations…
Considering the Tax Benefits of Medical Tourism
Additional Savings for Taxpayers Seeking Care Abroad
In Brief Medical tourism refers to travelling to a foreign destination for the purpose of receiving medical treatment. Americans are traveling abroad in record numbers…
In Brief The audit world is changing. Technology has transformed business processes and created a wealth of data that can be leveraged by accountants and…
Audit vs. Fraud Examination
What’s the Real Difference?
In Brief Contrary to what many think, the typical audits of financial statements do entail certain responsibility for the detection of fraud. The author examines…
Estimating the fair value of a nonmarketable financial instrument, or one that is restricted from sale, is conceptually challenging. Even though it could take significant…
Given the ongoing changes in accounting, auditing, tax and consulting standards; the scope of services provided; the proliferation of reporting frameworks; and the exponential increases…
Private Company Accounting Standards
Survey of New York CPAs Finds Adoption Slow
The CPA profession has been debating the concept of separate accounting standards for closely held businesses for over 40 years. In the December 1972 Journal of…
In May 2014, FASB and the IASB released a final, converged standard on revenue recognition [see Accounting Standards Update (ASU) 2014-09 and IFRS 15]. The…
The U.S. economy has been improving steadily for the past seven years, and interest rates have remained at historical lows. Nevertheless, there will be an…
To make informed decisions, financial statement users need to understand the nature of the items on a company's income statement, particularly whether they are persistent…
Characteristics of Financial Restatements and Frauds
An Analysis of Corporate Reporting Quality from 2000–2014
Corporate reporting quality has been at the forefront of the profession since the major corporate accounting scandals such as Enron and WorldCom at the beginning…
Avoiding Double Taxation of Storage Services
A Tale of Two States
There are times when two sales tax statutes are virtually identical but have different meanings due to the interpretations by the tax department charged with…
The Bipartisan Budget Act of 2015 (BBA) replaced the existing rules for auditing large partnerships with a new set of streamlined rules that take effect…
Determining the Treatment of Certain Interests in Corporations as Stock or Indebtedness
Final Regulations to Address Inversions and Earnings Stripping
On April 4, 2016, in order to discourage corporate inversions and potential earnings stripping, the IRS and the Treasury Department issued proposed regulations under Internal…
A fter a nearly 10-year collaboration to develop a converged standard on leasing, on Jan. 13, 2016, the IASB issued IFRS 16, Leases, and on Feb. 25,…
Accounting for Leases under the New Standard, Part 2
Lessor Accounting, Changes in Lease Terms, Practical Expedients, and Preparation Tips
In contrast to the lessee model, the lessor model under FASB's new lease accounting standard has three different types of leases: operating, sales-type, and direct…
Much has changed since the PCAOB began its inspection program in 2004. In just the last 10 years, the number of auditing firms registered with…
Accounting for Leases Under the New Standard, Part 1
Definition and Classification of Leases and Lessee Accounting
In Brief The new lease accounting standard, released by FASB in early 2016, represents one of the largest and most impactful reporting changes to accounting…
Marketers’ Methodologies for Valuing Brand Equity
Insights into Accounting for Intangible Assets
Many companies exhibit a discrepancy between their tangible book value and their market value. For example, global brand expert Kevin Keller cites PepsiCo, which had…
In Brief Corporate sustainability reporting is becoming more widespread with each passing year, and with that growth comes the need for companies to back up…
In Brief As more and more companies begin to devote serious attention to sustainability reporting, many different systems of rating the depth and effectiveness of…
Recent Trends in Reporting Non-GAAP Income
An Example from Social Media Companies
In May 2016, the SEC issued new Compliance and Disclosure Interpretations (CDI) and modified others to revise its guidance on the reporting of non-GAAP financial…
New York State recently adopted a “first-in-the-nation” set of cybersecurity compliance requirements that impact any businesses or organizations that report to the Department of Financial…