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Unclaimed Property: When Does the Auditing Go Too Far?

Post author By FFC
Post date December 13, 2016

Unclaimed Property: When Does the Auditing Go Too Far?

You know those gift cards you never got around to using? It’s possible they are now being counted as revenue by the state. Same goes for uncashed payroll checks and other financial instruments that were never claimed or used. States’ interest in unclaimed property as a source of revenue continues to grow. CPAs need to be extremely alert to state abandoned and unclaimed property (AUP) laws (which continue to evolve) and AUP reporting requirements to limit surprises related to an audit.

How does the process work? After the dormancy period expires, holders typically are required to turn over AUP to the state. AUP is property held or owed in the ordinary course of business that the owner has not claimed for a certain period of time and includes:

uncashed payroll and vendor checks

unapplied accounts receivable credits

dormant bank and brokerage accounts

unredeemed gift certificates and cards

life insurance policies

publicly traded securities with lost owners

customer refunds and rebates

benefit plan payments

contents of safe deposit boxes

Many states treat unclaimed AUP as a source of revenue. All states, as well as Puerto Rico, the U.S. Virgin Islands, and Guam, have AUP laws.

Favorable court decision and implications

Historically, Delaware is one state that aggressively audits AUP. Using contract firms to audit companies incorporated in the state, Delaware has estimated AUP liabilities as far back as 30 years. Delaware’s specious theory was that the entire estimate was “no-address property” subject to claim by the holder’s state of incorporation.

In June 2016, a federal district court held in Temple-Inland, Inc. v. Cook et al that Delaware’s method of estimating AUP liabilities violated due process, stating that Delaware “…engaged in a game of ‘gotcha’ that shocks the conscience.” In issuing its decision, the court noted that Delaware waited 22 years to initiate the audit and tried to exploit loopholes in the state’s statute of limitations. The state also failed to notify holders that unclaimed property records should be retained and had no legitimate state interest in retroactively enacting an estimation statute other than raising revenue.

The court’s ruling ostensibly reined in Delaware’s egregious audit methods. That’s the good news. The bad news is the court also concluded that: 1) estimating an AUP liability is permissible; 2) raising revenue is not a prohibited purpose for enacting AUP laws as long as it’s not the only purpose; and 3) apparently, any state can estimate a liability for any holder regardless of the holder’s state of incorporation. As a result, expect to see other states jump on the AUP audit-and-estimate-a-liability train as a way to generate revenue.

The Downside

Running counter to the fact that many businesses underreport AUP are the risks associated with overreporting certain types of property, in particular, appreciated stock, brokerage accounts, certificates of deposits, individual retirement accounts, and health savings accounts. Not surprisingly, states are eager to monetize equity property when it’s received, which stops the clock on future appreciation. Owners have sued – and continue to sue – holders and states for allegedly mishandling the AUP treatment of these types of property.

Adding to the uncertainty is the lack of reporting guidance – statutory or otherwise – for retirement-type accounts. State AUP laws haven’t kept pace with the development of new investment and retirement vehicles, and what little guidance is available often differs from state to state.

Imagine an individual who attempts to withdraw funds from an IRA account only to find that the funds were turned over to the state as AUP 25 years earlier, and, moreover, tax penalties are due because the money was reported before the individual reached retirement age. Failing to follow AUP due diligence procedures can be a costly mistake for holders, especially for property with a growth or appreciation component.

The AUP compliance environment is dynamic, with increasing litigation and constantly changing state laws. The pace of statutory change is expected to increase as states begin to evaluate the provisions of the Revised Uniform Unclaimed Property Act, which was approved by the Uniform Law Commission (National Conference of Commissioners on Uniform State Laws) in July 2016. Staying abreast of developments and understanding the rules – which, of course, vary by state – is critical not only to steer clear of expensive state audits, but also to avoid the potentially high cost of overreporting certain property types.

Chris Hopkins, CPA, is a tax partner with Crowe Horwath LLP based in New York City. He has been at the forefront of unclaimed property as the area has evolved into a significant source of state revenue, and contributes to The Tax Adviser. A significant part of Chris’ practice is devoted to consulting with companies on unclaimed property matters.

Money and lock courtesy of Shutterstock.

Find the Answers to Your Practice Management Questions

Post author By FFC
Post date December 12, 2016

Find the Answers to Your Practice Management Questions

Do you have questions about the best practice management direction for your firm? Should your firm consider value billing? Is your firm’s revenue comparable to other similar-sized firms in your area? How much are other firms investing in technology? The 2016 AICPA PCPS/CPA.com National Management of an Accounting Practice (MAP) Survey has the answers. The profession’s largest benchmarking poll on practice management topics, which is conducted every two years, offers unique perspectives on the latest trends within seven defined CPA firm segments, from small practices with less than $200,000 in annual revenue to large firms with $10 million or more. The comprehensive data spotlights best practices for firms, identifies challenges and highlights how firms are tackling them. Practitioners can use the survey data to compare their own approaches with those of firms in the same region along with those with similar revenues. They also can compare their firms to others across the profession. Let’s look at some of the insights the latest survey has to offer.

Revenue remains on the rise for nearly every firm size. The median rate of revenue growth ranged from 4.9% over the previous year for firms with $500,000 to $750,000 in revenue to 10.5% for those firms with less than $200,000 in revenue. That’s consistent with the kinds of advances seen in the 2014 survey, when growth measured from 4% to 8% across various firm segments.

Insight: Each firm’s situation is unique, and its potential growth depends on a variety of specific factors. However, it’s fair to say that the business of CPA firms is strong, something to be factored in when considering expansion, new hires or other significant changes.

Business is particularly good for the smallest firms. Not only did firms with less than $200,000 in revenues chalk up nearly 11% growth in the most recent year, they were also the firm segment that achieved the highest (8%) growth in the 2014 survey.

Insight: These numbers may reflect a few large new engagements or the startup phase of some new firms. In any case, these firms are clearly benefiting from strong practice development opportunities.

More modest profit margins can be a result of investments in the future. Profitability can be measured using “net remaining per owner,” or revenue minus expenses before partner-related compensation. Looking at this measure, it’s clear that median profit margins have not returned to pre-recession levels, and that is likely due in part to greater competition that might be depressing fee levels.

Insight: Since the recession, there have been indications that firms are making strategic investments in their future, which would explain smaller profits in the short term. Later, however, these investments would lead to greater profitability. That can include technology upgrades that will help streamline processes and enhance productivity, higher salaries that attract the best people and set the firm apart in a competitive hiring market, and investments in education and training that enable the firm to move into new niches.

Smaller firms lead in new approaches to billing. A case in point: Although 84% of all firms still use hourly billing, at firms with under $500,000 in revenues, a median of 25% of their fees are documented using another method, including fixed fee pricing, value pricing, a per-tax-form fee and client retainers.

Insight: Small firms should make the most of their flexibility, which can allow them to try new approaches to billing.

Large firms are showing interest in non-traditional strategies. The largest firms have embraced social media use in recruitment, for example, with a large majority of those with over $5 million in revenues putting a range of social media platforms to work in their recruiting efforts

Insight: Larger firms are well-positioned to use their resources to try new strategies. The survey also identified an opportunity for smaller firms: 11% of those with under $1 million in revenues are active social media recruiters, so those that use these tools may give themselves a competitive advantage in recruiting.

Firms are making the most of a variety of technologies. The use of tools such as cloud-based software, cloud-based backups and Skype or similar services to communicate has risen by double digits since 2014.

Insight: These are certainly a likely part of CPA firms’ strategic investments, and they pay off in obvious efficiencies. New forms of technology can also improve hiring opportunities among a new generation that has grown up with digital technologies and expects to see and use them in the workplace.

These are just a few of the insights that CPAs can glean from the MAP survey, which offers data on areas including financial results, billing, staffing, utilization and service areas, among others. AICPA members can access the executive summary which highlights key findings from the survey. After reviewing, you’ll come away with new perspectives on the profession and on how your own firm compares with others. Firms that use this data in their strategic planning will pinpoint areas to improve and make the most of existing opportunities.

Lindsey Curley, Senior Manager- Firm Services, American Institute of CPAs.

Kari Hipsak, Manager- Firm Services, American Institute of CPAs.

Benchmarking image courtesy of Shutterstock.

Professional New Year’s Resolutions

Post author By FFC
Post date December 8, 2016

Professional New Year’s Resolutions

“A goal without a plan is just a wish.” — Antoine de Saint-Exupéry

As a CPA, commitment to lifelong learning is a key to your continued success. To ensure you are meeting both your goals and CPE requirements, it is crucial to spend time planning how you will build not only your technical competence, but also your networking and people skills.

What works for me is setting New Year’s resolutions for my career every year. I start by assessing my development needs and setting my goals.

Try these questions to get started:

Are there skills I need to strengthen?

Are there gaps in my knowledge?

Do I want to provide new services to my clients?

Is there a certificate or a credential I want to add to my professional profile?

What do I want to achieve in 2017?

After identifying areas for growth, there are a few more questions:

Are my plans for the coming year aligned with my long-term goals?

Where would I like to be in three years? Or five years?

Once you determine how to focus your efforts, you will need to explore available opportunities and create a plan. Some questions to consider when developing a plan include:

Would an on-demand course or a webcast meet your needs?

Are there articles and books you should read?

Any podcasts that you could listen to on your morning commute?

Is there a conference that will help you gain technical knowledge and expand your network?

Challenge yourself to look for ways to get out of your comfort zone and not simply play to your strengths.

Next, ask yourself, “How do I assess the wide variety of options?”

Of course, your top concern is quality, but cost also may factor into your decision, as well as the time required to complete a course or earn a certificate. Where you learn is another consideration.

For some learners, an online course provides flexibility, yet others thrive in a traditional classroom setting where they can interact with peers. Think back on your experiences and note what worked best. Let that self-awareness guide your decision-making process. As you consider options, also remember the value of developing your staff, leadership and business acumen skills. They help grow your network, contribute to your professional development and enable you to expand your business.

Conferences are an excellent way to work on your essential skills and expand your network, while keeping you up to date on developments in the profession and your specialization. They also get you out of your routine, which can spur your creativity and renew your energy. Hearing the latest from thought leaders and industry experts, and engaging with your peers is a great learning experience. You might even have fun in the process.

Well-designed conferences curate the best content for you, expose you to new ideas, keep you on top of industry trends and allow you to engage in a variety of interesting activities. Some conference events combine multiple smaller conferences under one roof, allowing you to sit in on sessions outside your specialization. Maybe you want to learn more about financial planning to provide your tax clients with a more holistic approach. Or perhaps you want to know more about how to market your practice and services.

Learning and development also takes place in less formal settings. Maybe you want to join the board of a not-for-profit or a networking group. Perhaps you want to give back to the profession through mentoring and strengthen your ability to work with another generation. Have you thought about offering your skills pro bono to a cause you care about or a startup? Pro-bono work can sharpen your skills and even lead to new clients. Or perhaps you need to shore up your public speaking skills and joining Toastmasters would provide valuable feedback.

Whichever activities you choose, remember that your career development is a long-term investment. It requires time and effort. By writing down your plan, you are acknowledging your commitment to yourself and your career. Track your progress throughout the year to keep yourself motivated, and next December, revisit that plan and celebrate your achievements.

AICPA ENGAGE presents thought leaders, technical specialists, entrepreneurs, innovators and influencers for four days of fresh ideas, breakthrough presentations and workshops to open up possibilities for your members. It features inspiring keynote speakers who will share diverse perspectives on topics ranging from business acumen to creativity to Millennials.

Clar Rosso, Vice President-Member Learning and Competency, AICPA.

2017 goal setting courtesy of Shutterstock.

Leave Yourself Behind When Working With Clients

Post author By FFC
Post date December 7, 2016

Leave Yourself Behind When Working With Clients

I once attended a workshop in which an established adviser shared a story from a conversation he’d had with one of his clients. The client was a young, affluent widow who decided she wanted to fulfill a lifelong dream to buy a condominium in her favorite city in Europe. While she could well afford the $2 million price tag, something was keeping her from pulling the trigger.

The adviser asked, “What is it that is really bothering you about this purchase?” After some deeper probing, she finally shared her issue: “It’s just that I keep hearing my mother’s voice in my head.” (Her mother had died many years ago).

“And what is your mother saying?” he asked.

“She is saying that I am being frivolous with my money.”

When the adviser asked the group their thoughts on where the conversation needed to go from there, they quickly jumped in with recommendations like:

“You needed to show her why it was something she could easily afford.”

“Your job is to help her enjoy her life and her money.”

“Come on, given what you have told us about her other assets, this is silly. She needed to feel empowered by you to just do it!”

But is it really all so simple?

A number of years ago, I interviewed one of Connecticut’s most sought-after doctors while doing research for The Charismatic Advisor, a book co-authored with Dr. Robert Brooks. The doctor was a general practitioner with a closed practice. When asked what the one thing was that makes her so effective and successful with her patients, she was confident, yet humble, as she reflected on the question. After several minutes of back-and-forth, she gave me an absolute jewel: “All I can tell you is that when I knock on the door of the examination room I leave myself behind.”

Deeply struck by her answer, we spent quite some time exploring this notion. To paraphrase our ensuing conversation, what we concluded was that too many doctors and perhaps other professionals filter their advice through their own biases. Helping people meaningfully often means being completely empathic in one’s approach – it’s essential. That is, to continuously attempt to see the world through their eyes, instead of your own. Mastering this skill, however, is much more easily said than done.

Returning to the story of the young widow, simply attempting to convince her she could have afforded the condominium is not addressing her underlying issue. Even if she goes ahead and buys it, her conscience might persist in troubling her, making her purchase a joyless one.

If in delivering advice, you go down the path of thinking: “This is what I would do if it were my money,” you are going down precisely the wrong path. The fundamental aspect of your role as an adviser, and indeed the underlying nuance of much of this business, rests in the fact that it is not your money. It’s the client’s money, the client’s life and, ultimately, the client’s unique emotional baggage – or what Alan Parisse and I call “investment wiring” in Questions Great Financial Advisors Ask.

Once you consider “what I would do if it were my money,” all you are is another person with an opinion, not an adviser. Here are some questions you can pose to clients that can help you get to the underlying purpose and goals for your client’s money (as excerpted from Questions Great Financial Advisors Ask):

What do you want to do with your life?

Can you paint a picture of the way you want your future to look – a picture of your vision of your future? How would you feel if you achieved that vision? How would you feel if you didn’t?

When you visualize your possible future, does anything concern or scare you?

What are you hoping your money will accomplish for you? Depending on the answer, you might ask, “Are you sure money will accomplish that?”

What benefits do you expect from money?

Bottom line: Financial advisers are in the advice business, but that does not mean advising people based on your personal feelings. Can you “leave yourself behind?” If you can, you will be more effective and successful for your clients.

Don’t miss the opportunity to hear what David Richman and more of some of the most experienced minds in the profession have to say about building trust with your clients and transformative financial planning at the AICPA Personal Financial Planning Summit, which takes place January 23-25, 2017, in Rancho Palos Verdes, CA. The event for “leaders among leaders” features discussions, interactive sessions and fun networking opportunities to help deepen relationships with other like-minded professionals. The summit offers continuing education credits. Click here for more information.

David Richman is the National Director of Eaton Vance Advisor Institute. David has been a student of the financial advisory experience for the better part of three decades. He has been a featured speaker at numerous industry conferences and has co-authored five books on the topic of financial planning.

Financial planner advising client courtesy of Shutterstock.

Make a List, Check it Twice: Sensible Holiday Shopping

Post author By FFC
Post date December 6, 2016

Make a List, Check it Twice: Sensible Holiday Shopping

Walk into any drug store, and you’ll be bombarded with holiday music insisting “‘Tis the season to be jolly…” and other calls for assorted cheer. And while the holidays offer plenty of opportunities for moments of merriment, fun and being jolly, they can also be a source of anxiety and financial stress for many Americans.

Consider me among those many Americans this year. I have eight nieces and nephews, a few young cousins, grandparents, godchildren, and my husband and two-year-old son on my list. Oh, and I’m having kid number two on December 27. Where to begin? I find it helpful to follow these 10 steps to stay on track while doing your holiday shopping.

Make a list, check it twice. A big, scary don’t-leave-anyone-or-anything-out list. This includes the office Secret Santa gift, a few bottles of wine for the neighbors, gifts you donate to places of worship or charitable organizations, stocking stuffers, and the various friends and family members you’ll be sending gifts to. Then, take a deep breath.

2. Assess your finances. What is your budget? The last thing you want to do is spend freely today then realize in January it is going to take you six months to pay off a bunch of video games, expensive dolls, and extravagant Lego sets. Once you know what you’re comfortable spending, you can start to select gifts.

3. Missed Black Friday and Cyber Monday? There are great deals every day. Online retailers like Target and Amazon run deals throughout the season. My sister-in-law and I joined forces to take advantage of a buy two, get one free video game sale at Target for the various recipients on our lists. Be conscientious and check sites daily. Competition for customers is fierce, and there are deals to be had if you’re willing to put in the time.

4. Go straight to the source. If you’re looking for something online and can’t find it or think there may be a better deal to be had, call the retailer. My parents got a great deal and free shipping on a kid-sized table and chairs for my son’s playroom by calling the retailer to ask a few questions. The salesperson even offered them a discount.

5. Remember that not every gift has to be extravagant to be special. New readers might enjoy a set of books by a favorite author, while a creative child might like a new art kit. Rather than buying a brand new doll for a child on your list, buy some accessories for a doll they already have and love. For older kids who live nearby, consider an experience gift—take them ice skating, to the movies or zoo or to get a manicure and a pedicure.

6. Don’t be afraid of gift cards, but know your audience! I am an avid reader. An Amazon or Barnes and Noble gift card to be used for downloading eBooks is always welcome. Same goes for Dunkin’ Donuts coffee cards. My morning coffee is my financial weakness, so my husband stocks up on their yearly discount card offered at holiday time. He buys a ton of them and keeps me in discounted coffees for months. But if he (or anyone) were to send a Starbucks card? It would likely be immediately regifted. I can’t stand the stuff. Be a mindful gift card giver.

7. Stuff those stockings with practical stuff—gum, tooth brushes, lip balm, a favorite candy, mints, fun socks, a mini lint roller. Stores like Dollar Tree are a good place to pick up cheap stocking stuffers, as is the travel section in the drugstore or Target.

8. Be realistic with prices. When dealing with very small children (like my two-year-old son) remember that they don’t know the difference between a $5 item and a $500 item. Don’t put unnecessary pressure on yourself (and your bank account) to buy a gift that will impress the other adults in the room. Get something perfectly suited to that kid that fits in your budget. My son is getting truck stickers, books, puzzles, and a kids cleaning set so he doesn’t keep running off with my adult-sized Swiffer and knocking it into the newly painted walls.

9. Speak up if you feel your list has gotten out of control. If you suddenly find you’re buying gifts for far too many people, have a polite conversation with those you’d like to end the gift-giving tradition with. If possible, suggest a casual get together after the holidays instead, exchanging desserts, or baking cookies together. Sure, there might be a few hurt feelings, but it is better to have a conversation than spend money you don’t have, to avoid embarrassment. Anyone who can’t understand or respect your need to cut your gift budget isn’t helping your bottom line.

10. Remember what it’s all about. Lastly, do take time to step back from the shopping and list making to enjoy the beauty of the season and the end of the year. Spend time with friends and family doing something you love.

Lauren J. Sternberg, Communications Manager, American Institute of CPAs.

Holiday shopping courtesy of Shutterstock.

5 Things You May Not Know About IRS Form 990

Post author By FFC
Post date December 1, 2016

5 Things You May Not Know About IRS Form 990

With over 300 pages of instructions and 300 possible questions to answer, the IRS Form 990, Return of Organization Exempt From Income Tax is a complex and extensive form. It is filed annually by most exempt organizations, including charities. Here are five things you may not know or may have forgotten about Form 990:

It is a misnomer to call Form 990 an “income tax return.” There is no income tax calculation in the core Form 990 or within any of the accompanying schedules. The fact that it is not an income tax return becomes very important when attempting to apply the Internal Revenue Code to the filing of Form 990. Generally, where the Internal Revenue Code and the related regulations only reference an “income tax return,” the code or regulation in question will not normally apply to Form 990. It is very important, however, to remember that organizations subject to unrelated business income taxes (UBIT) file a separate Form 990-T, Exempt Organization Business Income Tax Return, which can be subject to the Internal Revenue Code and the regulations related to the filing of an income tax return.

There are 16 possible schedules that can be attached to the core Form 990. These schedules run the gamut from Schedule A, which is a required attachment for all Section 501(c)(3) organizations, to Schedule R that reports related entities, certain transactions with related entities, as well as certain unrelated partnerships. There is a schedule for foreign activities as well as for hospitals (Schedules F and H, respectively). There is, however, only one schedule that must be attached to every Form 990 that is filed: Schedule O, which is used to report required and supplemental information to the form.

Some organizations get tripped up on reporting of lobbying expenses. Lobbying expenses are those amounts paid for activities intended to influence legislation, be it foreign, national, state or local. The IRS makes the distinction between direct lobbying and grassroots lobbying. Direct lobbying applies to instances in which organizations attempt to influence legislators. Grassroots lobbying is when the organization attempts to influence legislation through influencing the general public, such as urging supporters to contact legislators with a position on specific legislation. Lobbying expenditures are reported within the Statement of Functional Expenses on Line 11d on the core form. However, not all lobbying expenditures are to be reported on this line. Salaries paid to an employee of the filing where the employee is engaged in lobbying is not to be reported on 11d. Section 501(c) organizations and Section 527 organizations are subject to limitations on lobbying and use Schedule C to furnish additional information.

Your organization is being watched. Form 990 is heavily scrutinized, not only by the IRS, but also by state regulatory entities that use it to investigate exempt organizations operating in their states. In over 40 states, Form 990 is filed as part of the charitable fundraising registration process. In addition, the form is made widely available and used by charitable rating agencies. Readers have various motives for looking at the form, so it is important to look at it with an eye toward how all potential readers will react to the information being presented.

In many instances, you cannot just check a box and be done. It is vital to read the instructions carefully. To give just one example, consider Section B of Part VII of Form 990, in which organizations report the five highest compensated independent contractors. The compensation to report is not limited to those contractors receiving a Form 1099 from the filing organization. You must report in Section B the top five that were paid more than $100,000 for services (not purchases of tangible personal property or rental or real property) rendered to the organization regardless of the need to prepare a Form 1099 for the service provider. The measurement date for the $100,000 is for the year ending within the year being filed. In other words, a June 30, 2016 fiscal year-end organization should look to the payments for services made during the year ending Dec. 31, 2015.

Do you want to learn more about the intricacies of Form 990 reporting? You can find reference materials for preparers and reviewers such as “Form 990 Red Flags” in the AICPA Not-for-Profit Section’s online resource library. Additionally, the AICPA is hosting a 2-hour, CPE-eligible webcast entitled “Form 990: Learn from the Experts” on Dec. 9 at 1 p.m. ET. Members of the AICPA Not-for-Profit Section can attend free of charge.

Bill Turco, CPA, Not-for-Profit Tax Director, RSM US LLP. Bill oversees the firm’s D.C. Metro tax practice. He has over 20 years of experience working with exempt organizations, including national and international charities, schools, churches and membership organizations. He is co-author of the 8-hour tax compliance track of the AICPA’s Not-for-Profit Certificate I program.

Business people working image courtesy of Shutterstock.

8 Ways to Save Money at Lunchtime

Post author By FFC
Post date November 30, 2016

8 Ways to Save Money at Lunchtime

Lunch prices are getting out of control. For instance, working in midtown Manhattan, it is a challenge to find lunch for $10 or less. That amounts to spending approximately $50 a week or $2,600 a year. Consider how these funds could instead be used to help you reach your intermediate or long-term goals— such as buying a home or saving for retirement.

According to a recent study by research firm NDP Group, the average lunch costs $8.36 nationwide. Because of this, Americans are starting to change their lunchtime habits. In fact, the same study reported that traffic at eateries during lunchtime is down 7% since last year. Below are some tips to help you stick to a lunchtime budget regardless of whether you choose to make lunch, buy it already prepared or join the (shorter) line at the sandwich, salad, and soup place near your office.

Shop smart and be flexible. Be an educated consumer. If you are going to make your lunch at home and bring it to work, it is important to know how much items typically cost at the supermarket. If you are familiar with prices you are more likely to know a good deal when you see one. Oftentimes, purchasing the store-brand instead of the name-brand will cost less. Also, keep an eye on circulars for deals on items you use regularly and stock up when they’re on sale. Your budget will thank you.

Bring leftovers. If you are cooking dinner, consider making a little extra to bring for lunch the next day, or for the next few days. Many meals such as soups, stews and pasta dishes reheat beautifully.

Pack a sandwich or salad. If the idea of bringing leftovers for lunch isn’t appealing, you might instead buy cold cuts and rolls and make sandwiches for the week or buy salad greens, grilled chicken and vegetables and make salads. These options will cost less than buying them already assembled near the office.

Being loyal often pays off. If bringing lunch isn’t for you, investigate whether any lunch places in your area reward you for your frequent business, such as giving you a free salad after you buy ten. If you are going to purchase lunch, why not be rewarded for doing so?

Consider a lunch subscription service. Relatively new to the market, these programs allow users to pick up lunch from a large number of restaurants all for much less than the listed price. Services like these currently operate in metropolitan areas including New York, Washington D.C., Boston, Miami, San Francisco and Chicago, and are likely to expand to other markets in the coming months.

Coupons are your friend. Food delivery services such as Yelp Eat24 and UberEats are popping up left and right. Many of these websites and apps regularly offer coupons, making them an attractive option if you want to order in for lunch.

Plan for the 3 p.m. snack attack. If you like to snack, stock a desk drawer with healthy, nonperishable snacks such as granola bars, dark chocolate, dried fruit, mixed nuts or jerky, or bring fresh fruit and cut up vegetables that you can store in the office fridge each week.

Stay motivated to save. For some people, bringing a turkey sandwich from home every day is a no-brainer. For others, the thought of limiting options can send them into a panic. If you aren’t so excited about finding ways to save, but really want to spend less on lunch, set small goals for yourself. For example, when you’ve saved a certain amount by changing how you approach lunch, treat yourself to something—a manicure, or a new scarf. Or, commit to bringing your lunch Monday through Thursday and treat yourself to buying lunch on a Friday. Check out this lunch savings calculator from Feed the Pig to see how a little lunch savings can go a long way. The key is to know what motivates you and implement a solution that will keep you saving.

We would love to hear from you. How do you save money at lunchtime during the workweek?

Alexis Rothberg, Communications Manager, American Institute of CPAs.

Packed lunch image courtesy of Shutterstock

Blast from the Past: Lessons Learned from #AdviceAt25

Post author By FFC
Post date November 29, 2016

Blast from the Past: Lessons Learned from #AdviceAt25

Look back at your 25-year-old self — what would you tell her or him? Would you share career wisdom? Life advice? What’s the one thing you’d share that could impact a young person?

Earlier last week, we asked our social media audience what advice they would share with their younger self using the hashtag #AdviceAt25. Here’s what they said:

Naveed Hussain

“Pave your own way, don’t lose yourself trying to be and look like others.”

Lisa Hastings

“Be brave! Hurdle yourself forward and ask for help along the way. Make the ask specific – an introduction, critical feedback – and cast a wide net of people in your circle.”

Dan Griffiths

“Invest even more energy into building a network. It’s much like saving for retirement. Small investments made early on can pay huge dividends down the road and it requires huge investments later in your career to make up for a failure to make the small investments when you’re just getting started.”

Peter Henley

“Do what you love to do, in a place you love to do it, with people who love doing it with you. What you love to do is usually, but not necessarily, what you’re good at.”

Natalie Brown

“The quality of your relationships – both personal and professional – will determine your success and satisfaction in life. Be steadfast with your value systems and allow them to guide you in your thought process, in your decisions, and ultimately your actions.”

John McSoley

“Slow down, listen and make time for yourself and your family.”

Larry Boyd

“Work hard at not being surprised. Constantly survey the horizon 360. Set aside time to ‘think critically’ about impact, and then act.”

Deidre Wolfe

“Ask questions and learn as much as you can. Surround yourself with smart, ethical people. Be willing to change and go with the flow.”

What advice would you give yourself at 25? Join the conversation using #AdviceAt25.

Elizabeth Rock, Specialist-Social Media and Member Engagement, American Institute of CPAs.

Six Tips for Valuation Experts in High Stakes Divorces

Post author By FFC
Post date November 28, 2016

Six Tips for Valuation Experts in High Stakes Divorces

The headlines announcing Brad Pitt and Angelina Jolie’s divorce were just the latest in a slew of stories about celebrity splits. In fact, there are more than 800,000 divorces and annulments in the United States each year, according to government statistics. Based on my experience performing valuations in many high-profile divorces, much of the advice I’d offer to my fellow practitioners applies whether you’re working with Brad and Angelina or the divorcing, high-powered owner of a local business. Below are my top tips:

Determine what’s at stake and how location matters. The assets in a divorce will typically include cash, retirement funds or a home. Often, the largest asset at stake is a closely held business. That can be a professional practice – if one or both partners are, say, a lawyer, physician or accountant – or an operating entity, such as a retailer, wholesaler, manufacturing business or a farm. The complexity of the engagement can be affected by the jurisdiction in which the case is being heard and can depend on state law. Be prepared, as the legal environment may produce unexpected complexities.

Expect complicated holdings to make for complicated valuations. Brad and Angelina are globetrotters. Valuations in divorces like theirs are typically more complex not only because of the range of their assets, but also the international nature of their lives. In one case, I worked with a divorcing, high-profile spouse who owned businesses in Australia, the United States and South America. The divorcing parties were Australian, but the divorce was taking place in the United States, so that alone added complexities because of the different laws and distribution rights. In addition, the risk profile of a business in some parts of South America is higher than for one in the U.S. or in Australia, and that will affect the valuation. The more diversified the assets and the lifestyle, the more complexity you may find.

Maintain an objective sense of value even if the spouses don’t have one. I was involved in another case in which the couple had assets in the hundreds of millions of dollars, but they were fighting over who gets the china and how much it’s worth. I’ve seen divorcing spouses willing to give up assets worth $10 million, as long as they get the family dog. In these situations, I always ask about any intangible value we haven’t considered. The lesson here is that divorcing spouses may not always have a realistic perspective on business or asset value. In many cases, they’re willing to give up value and fight for something for emotional reasons. That doesn’t change the nature of a CPA’s work or approach, but it’s something you may encounter in a highly charged case.

Let your client know you care. This is always true, but often there are clients who expect more outreach, particularly in a high-profile divorce case. I usually try to keep my communications straightforward and concise. When I was working with a very wealthy client, he called to fire me because he didn’t believe I was paying enough attention to his case, based on the volume of communications he received from me. I immediately called him to discuss his concerns and was able to explain the reason for my perceived lack of communication. He ended up changing his mind. No matter how busy a client may be, they take notice. So, it’s important for them to see and feel they’re being taken care of.

Have the right tools to make your points in the courtroom. Good communication is essential in court. To convey complex concepts, I find that demonstratives – or graphics – are critical for clarifying my points, such as graphs that show growth in value or pie charts that demonstrate market share or other concepts. They break down the information in a way that any audience can understand. And even though it may not be used in court, a well-written report is also key to a strong case.

Your success will depend on your networking skills. Divorce valuation is a unique niche, and those who are successful develop and maintain strong relationships with legal professionals in the same field and at the same level. Family law attorneys are the gatekeepers who choose the valuation professionals for their cases. Once you’re hired, you will start to get referrals for other cases.

Divorce is tough on everyone involved, no matter how high the stakes. The role you play is valuable, as you provide much needed information at a time of great uncertainty. That’s why it’s important to assure clients that your work is sound and trustworthy.

The AICPA’s Forensic and Valuation Services section is a great resource for forensic and valuation specialists, as it offers solutions to providing the best professional services. The Certified in Financial Forensics and the Accredited in Business Valuation credentials are another way for forensic accounting and business valuation professionals to position themselves as trusted advisers in two of the fastest-growing specialty areas for CPAs.

Neil J. Beaton, CPA/ABV/CFF, CFA, ASA, Managing Director, Alvarez & Marsal Valuation Services, LLC. With more than 25 years of experience analyzing both closely and publicly held companies, Neil specializes in the valuation of public and privately held businesses and intangible assets for purposes of litigation support, acquisitions, sales, buy-sell agreements, ESOPs, incentive stock options and estate planning and taxation. Neil recently presented sessions on report writing and the use of demonstratives at the 2016 AICPA Forensic and Valuation Services Conference.

Man signing divorce papers image courtesy of Shutterstock

Recipe for a Delicious Holiday, AICPA Style

Post author By FFC
Post date November 21, 2016

Recipe for a Delicious Holiday, AICPA Style

Thanksgiving, Christmas, Hanukkah, Kwanzaa, New Years. Late fall and early winter are choc-a-bloc with holidays and, thus, opportunities to entertain and cook for friends and family. Some people like to stick with their tried and true holiday recipes year after year. Others are always looking for something new to serve. And if you’ve been invited somewhere as a guest, you might be looking for just the right thing to bring to a party or holiday gathering.

AICPA staff and affiliates gathered some favorite recipes from aunts, uncles, or in my case, my second grade class in elementary school. We hope this collection of old favorites is helpful—and tasty. And as one colleague suggested, if toiling in the kitchen isn’t your thing, you can always make reservations!

Happy Holidays!

Fannie’s Crumb Cake

From Steve Rivera, CPA, CGMA, Worldwide Sr. Director, Financial Compliance & Procedures,

Johnson & Johnson

Preheat oven to 350 degrees.

Ingredients:

Use a 9 x 13 Glass Pan

Part I:

3 cups of flour

2 cups of sugar

1 tsp. salt

1 cup of vegetable oil

2 tsp. of baking powder

Part II:

1 cup of milk (whole or skim)

3 eggs

1 tsp. of vanilla

Optional – 1 can of Comstock Fruit (apple, blueberry or cherry)

Part III:

1 ½ stick of margarine or butter, softened

4 tsp. of cinnamon

Optional: Chocolate – Use dark chocolate cake mix and Hershey’s Special Dark instant pudding instead of the cinnamon.

½ cup white sugar

½ cup flour

Part I

Combine all the ingredients above in Part I in a bowl using a hand mixer.

Take 3 cups of the mix out and place into a separate bowl. This will be used later for the crumbs.

Part II

For the remaining mix, add the ingredients listed above in Part II.

Mix well and pour into a greased glass pan

Optional – spoon fruit evenly on top of batter.

Part III

Using the 3 cups of the mix you set aside in Part I, hand squeeze or mix in (on a slow speed) the following ingredients:

1 ½ stick of margarine or butter, softened

4 tsp. of cinnamon (you may want to add more for taste)

Optional: Chocolate – Use dark chocolate cake mix and Hershey’s Special Dark instant pudding instead of the cinnamon. Mix this with the remaining ingredients with the butter.

Add ½ cup white sugar with the rest of the mix

Add ½ cup flour with the rest of the mix

Mix should be ready to lay on top of the batter in the pan when the crumbs stick together. Lay crumbs on top.

Bake for about 55-60 minutes.

Pepperoni Balls

From Ann Marie Maloney

Preheat oven to 375 degrees

Ingredients:

Frozen bread dough, thawed and cut into small pieces (approx. 1 – 1 ½ inch in diameter).

Pepperoni, diced

Wrap dough around a small amount of pepperoni to form a small ball.

Pinch edges and place balls on a cookie sheet

Bake seam side down until done (about 10 minutes). These cook quickly so keep a close eye on them so the bottoms don’t burn.

Semi-Homemade Potato Pancakes

From Alexis Rothberg

Ingredients:

1 box Manischewitz homestyle potato pancake mix

1 Spanish onion

3 Yukon gold potatoes, peeled

2 eggs

1 cup water

Classic accompaniments: applesauce and sour cream

Using a box grater, grate the potatoes. Wrap them in a kitchen towel and squeeze over the sink to remove excess liquid. Place the potatoes in a medium sized bowl. Next, finely dice the onion and add it to the potatoes. In another medium sized bowl beat two eggs with a fork under blended. Add 1 cup of cold water and mix well. Then add the contents of the potato pancake mix and stir to combine. Let the mixture sit for five minutes to thicken. Add the grated potato and diced onion and mix. Prepare a large frying pan with 1/8 inch of vegetable oil. Drop tablespoons of the mixture into hot oil. Cook the latkes until golden brown on both sides. Enjoy!

Aunt T’s Broccoli Casserole

From Stacie Saunders

Ingredients:

2 eggs, beaten well

1 can of Cream of Mushroom soup

1 cup mayonnaise

1 cup grated cheddar cheese

1 Tbsp. grated onion

Salt and pepper

2 boxes frozen chopped broccoli, cooked and drained

Combine all ingredients in a large bowl. Transfer to a baking dish. Bake at 350 degrees for one hour.

Cranberry and Brie Cheese Puffs

From Carmen Encarnacion

Ingredients:

Puff pastry dough

Cranberry sauce (fresh or homemade)

Brie cheese

Cut puff pastry to fit a cupcake pan (any size cupcake pan is fine).

Put a cut piece of dough into each individual cupcake pan spot; push down slightly into the cup.

Fill with 1 tsp or 1 Tbsp. of cranberry sauce.

Put a piece of brie cheese on top.

Bake at 400 degrees. Follow instructions on dough package or until you see them puff and turn a nice light brown, roughly 5-7 minutes.

Careful removing from pan

If you don’t like cranberry sauce, use your imagination. This works with anything. Just don’t overfill the cups to avoid them spilling over!

Pumpkin Muffins

Submitted by Lauren Sternberg, courtesy of Miss Flynn’s second grade class, Hewitt Elementary School, November 1986

Preheat oven to 350 degrees

Grease muffin tin (regular or mini, or you can make 1 loaf of bread)

Sift together:

1 ¾ cups flour

¼ tsp. baking powder

1 tsp. baking soda

1 tsp. salt

In a large bowl, beat until fluffy:

1 1/3 cups sugar

1/3 cup oil

2 eggs

Add and beat in:

1 cup canned or cooked pumpkin (I use canned)

Alternate dry ingredients with:

1/3 cup water

½ tsp vanilla

Pour batter in greased muffin tin/loaf ban. Bake at 350 degrees until tests done. For mini muffins, this is about 10-15 minutes, depending upon your oven. Larger muffins and a loaf of bread are longer.

Lauren J. Sternberg, Communications Manager, American Institute of CPAs.