Journal of Accountancy articles from July 2007

Journal of Accountancy archives from July 2007

A risk-based approach to journal entry testing: how software can help auditors detect fraud.
July 1, 2007... EXECUTIVE SUMMARY * The top-side journal entry is most susceptible to fraud by management override. It's possible to make adjustments in subledgers, but this requires collusion with other organizational departments, which is much harder...

Simplifying global accounting: IASB chair discusses the future of IFRS, U.S. GAAP and the global accounting profession.(International Accounting Standards Board, International Financial Reporting Standards, )(Interview)
July 1, 2007... As chair of the London-based International Accounting Standards Board, Sir David Tweedie is championing an effort to develop a single set of global financial reporting standards that will be both understandable and enforceable. More than 100...

Tax patents considered: a practice by the U.S. Patent and Trademark Office of granting patents on tax strategies has raised red flags with many observers. Members of an AICPA volunteer task force tell why.
July 1, 2007... EXECUTIVE SUMMARY * The U.S. Patent and Trademark Office since 1998 has granted patents to business methods. In recent years, these patents have come to include strategies to minimize tax, a development many observers find troubling. Tax...

Delivering difficult messages: tools to tackle dreaded conversations.
July 1, 2007... EXECUTIVE SUMMARY * No one relishes an uncomfortable conversation. When the best interests of a company, firm, individual or the public are threatened, it's important to "be a leader" and take on the task. * A three-stage process can...

The dreaded kiddie tax: help your clients take some of the angst out of adolescence by managing their children's unearned income.
July 1, 2007... EXECUTIVE SUMMARY * Since 1987, taxpayers wanting to shift income to children subject to lower tax rates had to consider the kiddie tax when the children were under 14 years old. TIPRA, which became law in May 2006, made a significant...

All in the family: multifamily office practice is a coming-of-age story for many CPA firms.
July 1, 2007... EXECUTIVE SUMMARY * Multifamily office (MFO) services have long been offered by a variety of financial services providers. Increasingly, CPA firms have made this provision of comprehensive wealth management and personal services to...

NPO software measures up: an in-depth look at accounting packages for not-for-profits.(nonprofit organization)
July 1, 2007... If you're in the market for nonprofit organization (NPO) accounting software, you're in luck. Most of the products have undergone major upgrades in recent years that have made them far more powerful, feature-rich and easier to use. In our...

Keeping secrets: how to protect your computer form snoops and spies.
July 1, 2007... You may be able to keep a secret, but how confident are you that your computer is up to the task? As a CPA, you're entrusted with loads of confidential information, and your professional reputation depends on your discretion. But your...

Practice makes perfect.(estate tax returns)
July 1, 2007... Tax practitioners have enough concerns without having to fear the specter of a professional liability claim resulting from a preventable mistake or oversight. Many of these slip-ups can be prevented by simply jotting a contemporaneous note...

Disallowed idemnity deduction blues.
July 1, 2007... From time to time, corporate officers and shareholders agree to indemnify their corporations for certain expenses and losses. The taxpayer would prefer to claim an ordinary loss deduction instead of a capital loss or, worse, a nondeductible...

No gain, some pain for another lottery winner.
July 1, 2007... The Second Circuit Court of Appeals joined other courts holding that a taxpayer's sale of rights to future installments of lottery winnings is ordinary income and not capital gain. Shirley Prebola won $17.5 million in the New York State...

Service boosts number of correspondence examinations.
July 1, 2007... The IRS is increasingly relying on correspondence examinations, rather than face-to-face office or field examinations, to audit taxpayers' returns. In a correspondence examination, the Service asks the taxpayer to explain questionable items...