Accountants help to manage record reporting. Accountants prepare for clients reports of audits, balance sheets, and other financial, accounting and related schedules, exhibits, statements or reports which are to be used for publication or for credit purposes and many other services & report.

Contact our local accountants for your recordkeeping

Good records will help you monitor the progress of your business, prepare your financial statements, identify source of receipts, keep track of deductible expenses, prepare your tax returns, and support items reported on tax returns. You may choose any recordkeeping system suited to your business that clearly shows your income and expenses. Except in a few cases, the law does not require any special kind of records. However, the business you are in affects the type of records you need to keep for federal tax purposes.Gross receipts are the income you receive from your business. You should keep supporting documents that show the amounts and sources of your gross receipts.

Accountants use some of these Documents for record keeping:

• Cash register tapes
• Bank deposit slips
• Receipt booksInvoices
• Credit card charge slips

Purchases are the items you buy and resell to customers. If you are a manufacturer or producer, this includes the cost of all raw materials or parts purchased for manufacture into finished products. Your supporting documents should show the amount paid and that the amount was for purchases.

Expenses are the costs you incur (other than purchases) to carry on your business. Your supporting documents should show the amount paid and that the amount was for a business expense. Documents for expenses include the following: canceled checks, cash register tapes,Account statements, credit card sales slips, invoices, petty cash slips for small cash payments and others.

Contact our local accountants for your recordkeeping

Accountant Wins Special Award Paul Farber Receives Arthur J. Dixon Memorial Award

October 31, 2005 – New York, NY – Eisner LLP, a premier middle-market accounting and business advisory services firm, announced today that Paul Farber has received the American Institute of Certified Public Accountants’ prestigious Arthur J. Dixon Memorial Award, the highest award given by the accounting profession in the area of taxes.

Mr. Farber has been a practicing CPA for nearly 60 years, and is currently a principal at Eisner providing a broad spectrum of tax services to diversified public and privately held companies. International activities, including acquisitions and structuring, are his primary focus. He began his professional career with S.D. Leidesdorf & Co., and came to Eisner upon his retirement from Ernst & Whinney in 1986.

Mr. Farber has long taken an active role in professional international tax activities, and currently serves as a member of council of the USA Branch of the International Fiscal Association and as a general reporter for IFA’s Cahiers de Droit Fiscal International. He formerly served as chairman of the International Taxation Committee of the American Institute of CPAs, as a member of the Tax Management Advisory Board (Foreign Income), and as chairman of the Federal Taxation Committee of the New York State Society of CPAs. In addition, Mr. Farber was an adjunct professor of accountancy at the Graduate Division of Baruch College, City University of New York, is a frequent lecturer before professional groups, and author of numerous tax articles. He is also one of the founders of The Tax Adviser.

This annual award is in honor of Arthur J. Dixon, CPA, who had an outstanding record of service to the tax profession and the AICPA Tax Division. Mr. Dixon chaired the AICPA’s Tax Division Executive Committee from 1977 to 1980, and was known as “the tax person’s tax person.” The award is given for distinguished service in the area of taxes, in the spirit of Mr. Dixon’s professionalism.

“We’re extremely proud for Paul on his being recognized with this honor,” says Eisner managing partner Charles Weinstein. “His contributions to the firm, our clients, and Baker Tilly International over the years have been immeasurable, as has the personal integrity and dignity with which he’s always carried himself.”

Accountants perform a wide range of services.

Public accountants have their own businesses or work for public accounting firms. They perform a broad range of accounting, auditing, tax, and consulting activities for their clients, who may be corporations, governments, nonprofit organizations, or individuals.

1. What does The "straight-line" method of depreciation assume ?

The depreciation of an asset is a uniform function of time.

2. What financial statements will I need for a small business?

You should prepare and understand two basic financial statements:
the balance sheet, which is a record of assets, liabilities and capital; and
the income (profit.and-loss) statement, a summary of your earnings and expenses over a given period of time.
 
3. What is a 'balance sheet'?

A Balance Sheet is a summary (or statement) of all the accounts used in a business. If an account has a debit balance it is usually shown on one side of the balance sheet under a heading called 'assets' (these are things the business owns). If an account has a credit balance it is shown on the other side under a general heading called 'liabilities' (these are the things the business owes).

4. What are 'reversing' and 'correcting' entries?

If you discover a mistake in an earlier transaction, it is not usually a good idea to delete or amend it (especially if it was in an earlier accounting period which will affect your tax/VAT liability). Instead you should enter a completely new transaction to reverse the original, followed by another transaction (known as a 'correcting' transaction) to enter what really happened.

The new reversing and correcting transactions should be dated the day you found the error. The effect of this is that you will end up with three transactions: the original; the reversing one (which nullifies the effect of the original); and the correcting one. Because they will have different dates you will be accounting for everything and will have no problems with the tax authorities!

5. What is a general ledger?

An accounting record or legend in which are listed all increases or decreases of all other accounts such as liability, reserve, capital, income and expense accounts.

6. What is gross margin ?

1- the difference between the total sales revenue and the cost to the seller of the items sold. 2- an amount, expressed as a percent, which is stated in the terms of a loan and which is added to the percentage expressed by a controlling rate index to establish the rate the borrower pays on the loan.

7. What is Accounting Principles Board (APB)?

Senior technical committee of the AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS (AICPA) which issued pronouncements on accounting principles from 1959-1973. The APB was replaced by the FINANCIAL ACCOUNTING STANDARDS BOARD (FASB).

8. Do I need to worry about Accumulated Depreciation and what is it exactly?

Total DEPRECIATION pertaining to an ASSET or group of assets from the time the assets were placed in services until the date of the FINANCIAL STATEMENT or tax return. This total is the CONTRA ACCOUNT to the related asset account.

9. What does AICPA stand for?

National professional membership organization that represents practicing CERTIFIED PUBLIC ACCOUNTANTS (CPAs). The AICPA establishes ethical and auditing standards as well as standards for other services performed by its members.

10. Are Annual Reports done by accountants and what is included in one?

Sometimes, it is a report to the stockholders of a company which includes the company's annual, audited BALANCE SHEET and related statements of earnings, stockholders' or owners' equity and cash flows, as well as other financial and business information.

Accounting FAQ’s

Q: What is my best option for asset protection if my estate is modest (under $150,000)?

Q: How effective are Limited Liability Companies (LLC) in protecting my assets?

A: Most states do not limit creditors from bringing claims against LLC’s or FLP’s so your best asset protection option may be a trust.

A: The most effective structure for asset privacy is a living trust; it will help your loved ones from the burden probate and keep your assets private. LLC’s can also help for non-business assets.

Q: How can I reduce the taxes to my heirs?

A: A living trust that includes provisions for discretionary spendthrift distribution is probably the best option but this will also limit access to the assets by the heirs.

Q: How can I protect myself from lawsuits if I own rental properties?

A: In most cases the best protection is for you to set up a separate LLC for each property, this will help shelter the individual properties should one be faced with a lawsuit.

Q: What are the benefits of an asset protection trust?

A: An asset protection trust or APT allows the Grantor to be included as a beneficiary; normally this would violate discretionary-spendthrift trust rules. A LLC can be structured to work with an APT to further protect your assets.

Q: What is the False Claims Act?

A: The false Claims Act allows individuals with evidence of fraud against the federal government to sue for triple the amount defrauded from the government. The individual that filed the lawsuit receives between 15 to 30 percent of the total recovered as compensation.

Q: How does an IRA work?

A: An IRA or Individual Retirement Account is a personal savings plan designed to help individuals save for retirement. This is done by securing tax benefits for accumulating money for retirement.

Q: What is the difference between Traditional IRA and Roth IRA?

A: A traditional IRA lets you take your tax deduction upfront. This is best if you need the tax deduction at the time you open the IRA or if you anticipate being in a higher tax bracket after retirement, a Roth IRA is more flexible allowing you to withdraw your contributions at any time without penalty or mandatory distributions after age 70.5.

Q: Is there an age limit for contributions to my employer’s 401(k)?

A: The only requirement is that you are still an employee by the company sponsoring the plan regardless of age.

Q: Can I transfer my SIMPLE IRA to a Roth IRA?

A: Assets in a SIMPLE IRA can be rolled over to another IRA two years after the account was established. The amount you roll over will be treated as normal income and therefore subject to income tax.

Accounting Glossary Terms

Accountancy - This is the measurement of financial information used primarily by investors, tax authorities and managers for assurance reasons and decision making processes. Accountancy is also referred to as accounting which is commonly known as the “language of business".

Accounts Payable - A record of what a company owes, money designated for suppliers to payoff goods or services purchased from companies or individuals.

Accounts Receivable - A record of what a company is owed, money anticipated to come in from goods or services sold to other companies or individuals.

Assets - Assets are the resources a business or organization owns. Assets are further broken down into the following categories: Fixed Assets (equipment, buildings etc.), Current Assets (cash), and Non-current Assets (that which does not fit in the above categories).

Audit - The process of reviewing and checking all financial book entries to insure they  correspond with the original paperwork.

Balance Sheet - A business accounts summary. This sheet is prepared at the end of each financial year or fiscal period.

Capital - Capital consists of any amount of money put into supporting a business, such as a loan. This does not include money earned by the business.

Cash Flow - This report illustrates all money coming in and going out of a business over a designated period of time.

Certified Public Accountant (CPA) - This is an accountant who has received a credential from a state or government jurisdiction. In order to achieve CPA status, one must meet a combination of requirements including: education, experience, ethical requirements, and the passing of the Uniform CPA Examination.

Debit - The record entry displayed in a financial journal of the money owed.

Depreciation - Depreciation is the amount or percentage in which an assets’ value decreases. This is commonly calculated and recorded at the end of each accounting period.

Equity - Equity is the overall value of the business to the owner. This does not include business’s assets and liabilities.

Expenses - Purchased goods and services for a business. This does not include goods used as capital or goods purchased for re-sale purposes.

Financial Accountancy (Financial Accounting) - This is the field centered around the preparation of financial statements. The financial statements are essentially used by management to make informed decision making for the business.

Financial Statements - A record of all financial transactions made by a business. This record provides vital information on the entity’s monetary resources and obligations. It consist of four statements used to retain a complete evaluation of a businesses: balance sheet, income statement, statement of cash flow, statement of retained earnings.

Fiscal Year - The accounting year for a business. This period of time must consist of a full year but may start during any given month based upon the businesses date of establishment.

Fixed Assets - Anything owned or bought by a business for use within the business alone, as long as the items retain value by the year end. Fixed assets include items such as land, buildings, and equipment.

Gross Profit - The credit balance of a trading account, the difference between the revenue and the expenses of a company or individual.

Intangible Assets - All assets which are non-physical or are not considered of a financial nature. Intangible assets include items such as loans and endowment policies.

Internal Auditing - The activity and profession of advising an organization. An internal audit is used to analyze business processes and problems to ultimately advocate effective solutions to better the organization or business as a whole.

Liabilities - All monies owed by the business to suppliers, bank overdrafts, and loans taken out for the business. Records of all liabilities are kept on the businesses balance sheet.

Management Accounting - All accounting information used by management in order to formulate informed business decisions for a company.

Matching principle - This is the method of analyzing sales and expenses, to determine the precise profit from particular sales made during a certain period or for a particular time.

Maturity Value - The value of an intangible asset estimated on the specific date it is due.

Net Loss = (Expenses – Sales) Assuming expenses are greater

Net Profit = (Sales – Expenses) Assuming sales are greater

Retained Earnings - The amount of money a business holds after the profits shares are distributed out.

Tangible Assets - All physical assets. This included buildings, vehicles, equipment, fixtures, etc.

Total Cost of Ownership (TCO) - The amount an asset will eventually cost, including extra cost attached to the original item.

Transaction - The exchange of goods or services for money, physical or entries on a financial statement. Entries of two or more into a journal meant to echo a previous document.

AICPA Council Endorses Dedicated Effort to Explore Potential Changes to GAAP for Private Companies AICPA to Work with FAF and FASB

NEW YORK, NY—May 23, 2005—The governing Council of the American Institute of Certified Public Accountants (AICPA) today passed a resolution that announces the profession’s intent to work with the FASB to evaluate potential changes to generally accepted accounting principles (GAAP) for privately-held, for-profit companies, as recommended by one of its task forces. “This is a noteworthy milestone for the constituents of private company financial reporting who argue their needs are significantly different from those of users of public company financial reporting,” Robert Bunting, Chair of the AICPA said.

Because private companies represent an important part of the nation’s economy we must ensure that today’s and tomorrow’s accounting standards remain relevant to their constituents’ needs,” he added. The resolution adopted by the AICPA Council directed AICPA management to work with the Financial Accounting Foundation (FAF) and the Financial Accounting Standards Board (FASB) to identify and implement a process that would evaluate, where appropriate, potential changes in recognition, measurement, and disclosure from current GAAP as applied by public companies.
“We are happy with the Council’s vote,” Barry Melancon, AICPA President and CEO, said. “It moves us on to the next phase, and we look forward to working cooperatively with FAF and FASB on this initiative.”

The vote follows the March release of the report by the AICPA’s Private Company Financial Reporting Task Force that unanimously recommended that a process be established to improve the usefulness of private company financial reporting. The task force began its work more than a year ago in response to concerns expressed by some interested parties about the relevance, benefits, and related costs of certain financial reporting requirements for privately held, for-profit entities. “Overall, the response from those surveyed rated the value of GAAP financial statements of private companies quite highly on consistency, providing comparability among companies, and on their use as a tool in credit and investment decisions,” said James G. Castellano, CPA, and former Chair of the AICPA, who headed the Task Force. “However, through our discussions, focus groups, and research, we learned that constituents rated certain GAAP requirements as providing relatively low relevance and decision usefulness to constituents of private company financial reporting. It’s this research that resulted in Council’s vote today,” he said

Asset Protection

The ultimate goal of asset protection is to legally separate an individual or organization (debtor or defendant) from their assets while preserving administrative control and beneficial ownership. The concept is based on the fundamental rule that unprotected assets can be pillaged by that entity’s creditors or plaintiff(s) should the entity come under legal scrutiny. An exception to this is an ERISA-qualified retirement plan which is protected from liability and can not be considered when awarding damages. There are a number of different permissible legal instruments designed to protect assets from liability. Different shelter structures are used to protect assets such as: real investments, rental properties, private residences, financial assets, bank accounts, retirement plans, etc.

Don’t leave your assets vulnerable to legal judgments. Contact a skilled CPA that specializes in asset protection today.

Which protection plan is best suited for your individual situation depends on:

• Your risk probability.
• The point in time of the claim.
• The assets that are being protected.
• The assertiveness and aptitude of the creditor.

Without a proper asset protection plan in place to cover your personal property, your assets are vulnerable to civil liability and a creditor may be able to obtain a judgment against you or your company. Having a plan in place to guard against the threat of an outside entity taking control of your hard earned resources is a smart business decision ensuring the future of your investment. You need a skilled and proficient accountant to set up a personal protection plan that works best for you and your assets given your individual circumstances.

Some of the vehicles designed for asset protection include:

• Foundations
• Corporations
• Overseas Trust
• Portfolio Bonds
• Swiss Annuities
• Offshore Company
• Limited Partnership
• Prenuptial Agreement
• Limited Liability Company

Engaging in business can satisfy your hopes and dreams for a better life and financial independence, but it can also leave you exposed and susceptible to law suits and claims against your hard-fought and well-deserved rewards. Adopt shielding strategies to safeguard your nest egg and hard-earned prosperity from the threat of litigation.

Don’t leave your assets vulnerable to legal judgments. Contact a skilled CPA that specializes in asset protection today.

Business Auditing Services

Business auditing services can provide third party audits of financial statements free from the cumbersome responsibility that internal auditors face as an in-house part of the company. External financial audits can add credibility and weight to the preliminary audits done by an organization's domestic accounting or financial departments to assure that its financial statements fairly represent the organization's economic position and performance to the firm's stakeholders. A company’s stakeholders usually refer to its shareholders, but it can also include parties such as: banks, regulators, tax authorities, suppliers, customers and employees. Any or all of these entities may have a vested interest in the accuracy of a company’s financial statements.

Are you in need of the business auditing services of an external auditor? Contact one of our experienced and skilled CPAs for all the business auditing services your company needs to get ahead.

Business audit services may also perform operational, financial, and information technology audits in agreement with approved standards and the established policies and procedures for your individual company. The audit service is designed to diminish the likelihood of a ledger error or a misstatement. A misstatement is false or missing information, be it deliberate or a mistake. 

Business audit services may include:

• Reviewing and assessing the competence and efficiency of the company’s systems of internal financial and material control.
• Appraising and evaluating new or implemented changes in services, procedures, operations, and controls concurrent with development and implementation.
• Recognizing prospects for cost reduction, optimizing practices, or giving your company recognition and credibility.
• Evaluating policy compliance, tactics, strategies, procedures, regulations, laws, and contract provisions.
• Confirming that resources are obtained economically, accounted for accurately, effectively protected, and used efficiently.
• Evaluating operations or programs in place to determine whether the results are consistent with declared goals.
• Supporting and assisting in any investigation of alleged suspicious or irregular conduct in relation to company resources.
• Developing and executing an adjustable audit service plan using suitable risk-based tactics, including issues recognized by management or stakeholders.
• Assessing the dependability and integrity of operating and financial information and the technique used to identify, categorize, calculate, and report the information.
• Evaluating the accuracy of work done by external auditors and regulators to affirm it as suitable in providing optimal audit coverage to the company at a sensible cost.

Are you in need of the business auditing services of an external auditor? Contact one of our experienced and skilled CPAs for all the business auditing services your company needs to get ahead.

Business Planning

Do you need a business planning strategy? Contact one of our skilled and qualified CPAs today to help you draft a business plan that will satisfy your backers or lenders.

Business planning can work for either for-profit or non-profit businesses. For-profits business plans, naturally, focus on financial goals with the emphasis on productivity and financial success. Non-profits and government agencies’ business plans focus on the services they provide and adequately targeting their services. A business plan may also direct its focus externally, on the individuals with financial interests of the business or internally, on the in-house goals needed to reach the external goals like product development, service expansion, financial restructuring, implementing IT systems, etc.

Business planning typically consists of:

• A description of the business, product or service including advantages, infrastructure and benefits.
• What plans do you have for the business, product or service (purchase, expansion, development, etc.)
• Justification and credibility for the campaign that explains the need for the business, product or service.
• Marketing tactics including costs, benefits, advertisement and promotion, likely customers and how they will be targeted, etc.
• Staffing policy including employees and experts needed for the daily operation of the business, manufacture of the product, or service providers.
• Management policy including expertise, organization, coordination and leadership.
• Financial strategy including cost of set-up, operational expenses, anticipated revenue, forecasted budgets, and expected profit turn-over.
• Appendices of your current business, product or service providing an overall report of the existing organization, other products and service, current staff, etc.

Appraising your business for its current financial situation, productivity and operations can open doors for the purpose of getting financing to improve or expand your business or give you a practical economic value of your business. It can be the edge you need to succeed in today’s business climate by providing a professional assessment of the value of your business. Business planning provides you with an invaluable outline of the condition of your business that can be used to further develop your business, product or service to ensure further success.

Do you need a business planning strategy? Contact one of our skilled and qualified CPAs today to help you draft a business plan that will satisfy your backers or lenders.

Business Valuation

Assembling an adequate business valuation is vital for the enduring success of any company. Contact one our business savvy CPAs for assistance in outlining and implementing you business valuation.

There are two main misconceptions about business valuation:

1. That you only need it when you require financing, refinancing or when selling your business.

When you need any type of financing or when selling your business you will need a comprehensive business valuation resource. But in almost all business transactions you will need a comprehensive financial understanding and a breakdown of the worth of that business. It can also help with the internal transition of ownership. Another is if the firm is made up of multiple owners there should be a buy-sell agreement accompanied with the proper life insurance for key executives. The life insurance should be structured so that the pay-outs would provide adequate funds to the beneficiaries to purchase the deceased ownership at an agreed upon value. The valuation should be updated regularly so that it properly reflects the financial development of the company and to ensure compliance with IRS regulations.

2. I know how to figure the value of my business, the Earnings Before the deduction of Interest, Tax and Amortization (EBITA) twice the annual revenue.

Revenue multiples, principally used by business brokers lean to the median multiple values and traditionally have proven to be too general for adequate valuation. This method does not precisely reveal the revenue multiple for a genuine transaction, but only reflects an average. This would leave questions as to the true value of your business. It is financially sound to know the proper and correct value of your business.

Business Valuation Resource Methods:

• EBITA
• Discounting
• Hurdle Rate
• General Rules
• Pay Back Method
• Commodity Theory
• Replacement Value
• Discounted Cash Flow
• Activity Based Costing
• Internal Rate of Return

A sensible and prudent owner or senior manager would do well to know the accurate market value of their business, even if they do not intend to sell. The question of your business’ actual worth should be something you are familiar with not just for you and your peace-of-mind but for the well being of your family and beneficiaries.

Assembling an adequate Business Valuation is vital for the enduring success of any company. Contact one our business savvy CPAs for assistance in outlining and implementing you business valuation.

Certified Public Accountant

A certified public accountant can be your best economic guide to financial success and fiscal stability. Whether an individual or a company, keeping up with your financial records, taxes and fiscal rights and responsibilities according to law can be a daunting task. A trained and certified public accountant can alleviate the worry and guesswork out of your finances and bring you peace-of-mind so that you can focus on the issues that are most pressing to you. The organization and understanding an accountant can bring to your financial state of affairs may prove to be immeasurable. With a clear and concise interpretation of your financial condition you can make more informed and calculated decisions that could make the difference you or your business needs to excel.

Do you need a certified public accountant to help you get your financial condition in to prospective? Contact a certified public accountant today and put the guesswork behind you.

Certified public accountants perform a broad range of accounting services that can include internal auditing, tax issues, and consulting services for a better understanding of your economic condition. Accountants are equipped and prepared to give advise on tax advantages, preparing individual and company income tax returns, compensation or employee health care benefits, design of accounting and data-processing systems, provide information on how to safeguard assets, audit financial statements, and inform investors allowing individuals, business owners, and investors the opportunity to make sound and informed economic decisions. Accountants can ensure that your personal records are clear and concise or that your firm runs efficiently and diligently by keeping accurate financial records, verifying financial documents, investment planning, budget analysis, internal auditing, tracking taxes and working out tax payment schedules for you or your firm.

Accountants can help with:

• Taxes
• Budgeting
• Investments
• Cost Management
• Asset Management
• Performance Evaluation

Having an experienced accountant on your team can help you make more responsible and informed economic choices for the benefit of you and your business. The services and counseling that an accountant can bring to your financial condition may position you and your company for advancement and success as well as alleviate the worries of possible financial pitfalls or economic oversights which could have devastating effects on your prosperity and security.

Do you need a certified public accountant to help you get your financial condition in to prospective? Contact a certified public accountant today and put the guesswork behind you.

FASAB Issues an Exposure Draft Entitled Reporting Gains and Losses from Changes in Assumptions and Selecting Discount Rates and Valuation Dates

Financial Statements

Financial statements are formal records of all financial activities within a company. It is imperative to have accurate and up to date financial statements for your business. The statements include a listing of numerous transactions which need to be recorded properly to correctly assess a business’ financial stability. These factors include, but are not limited to, a listing of assets, accounts receivable, accounts payable and account totals. There are four primary documents which collectively represent the financial condition of a business. Therefore it is important to correctly produce each statement; otherwise a mistake can follow through to the next statement. An experienced accountant can produce and maintain all your financial statements in an efficient and effective manner.

Does your company need to produce effective financial statements? Contact a skilled and experienced accountant regarding the financial statements of your company today.

The four basic financial statements which need to be updated consistently are as follows:

• Balance sheet
• Income statement
• Statement of cash flow
• Statement of retained earnings

A balance sheet holds all balances for asset accounts, liability accounts, capital stock, and retained earnings. An income statement reports all expenses, revenue as well as the capital gains and/or losses. The cash flow statement defines the reasoning behind each change in cash balance. And last but certainly not least, is the retained earnings statement which states the retained earning figures from both the beginning and end for a fiscal period. These financial statements are extremely complex and need to be assessed by a qualified and experienced accountant.

For large companies, financial statements can prove to be extensive and very complex therefore financial statement notes will need to be produced as well. These notes will further explain, in greater detail, the transactions recorded on the balance sheet, income statement, and the statement of cash flow. An accountant can handle all these matters to ensure your statements are up to date. Contact a knowledgeable accountant today for more information.

Does your company need to produce effective financial statements? Contact a skilled and experienced accountant regarding the financial statements of your company today.

IASB Issues Amendment to Hedge Accounting Provisions of Financial Instruments Standard

The International Accounting Standards Board (IASB) today issued an amendment to the hedge accounting provisions of IAS 39 Financial Instruments: Recognition and Measurement.

The IASB developed this amendment after constituents raised concerns that it was common risk management practice for entities to designate the foreign currency risk of a forecast intragroup transaction as the hedged item and that IAS 39 (as revised in 2003) did not permit hedge accounting for this.  Furthermore, IAS 39 (as revised in 2003) created a difference from US accounting requirements on this point.

Following publication of an Exposure Draft and extensive consultation with constituents, the IASB has decided to allow the foreign currency risk of a highly probable forecast intragroup transaction to qualify as a hedged item in consolidated financial statements.  This is consistent with the provisions of the international accounting standard on foreign currency, IAS 21 The Effects of Changes in Foreign Exchange Rates.

Introducing the amendment, Sir David Tweedie, IASB Chairman, said:

The amendment issued today allows many entities to use hedge accounting for foreign currency risk in a way that matches current risk management practice.  The amendment follows extensive consultation with many of our constituents.

The primary means of publishing Standards and amendments to Standards is by electronic format through the IASB’s subscriber Website.  Subscribers to the IASB’s Comprehensive Subscription Service are able to access the amendment published today through the secure online services area of the IASB’s Website: www.iasb.org .    Those wishing to subscribe should contact:

IASCF Publications Department, 30 Cannon Street, London EC4M 6XH, United Kingdom.
Tel: 44 (0)20 7332 2730  Fax: 44 (0)20 7332 2749
email: publications@iasb.org  Web: www.iasb.org

Internal Audit

Is your company in need of assistance regarding a potential audit? Be prepared for an audit by improving the quality of your company now. An accountant knowledgeable of internal auditing can help your company regulate auditing requirements established by the U.S. government. An accountant can also help analyze your business as a whole while providing you with suggestions on how to improve the effectiveness of internal issues. These issues can include but are not limited to risk management, and the governing of procedures both old and new.

Does your business require an experienced CPA to assist you with an internal audit? Contact a capable and experienced CPA to represent your business for an internal audit today.

The following steps are typically used during an internal audit:

1. Establishing the objectives of the audit to management.
2. Review and understanding of all the businesses objectives and transactions.
3. Ensure control over transactions.
4. Development of approach to determine controls are operating properly.
5. Report problems to management and create actions to fix the existing problems.
6. Follow-ups

Internal auditing is performed in order to gain control over the internal processes within a company and to use this information to improve the company overall. The objectives used to determine the improvement needed and to recognize flaws in the system include financial report reliability, effectiveness and efficiency of operations, and compliance with governed regulations and laws.

Are you concerned that your business isn’t completely complying too government laws? Avoid the doubt and take measures to fix and improve the internal functioning of your company. Receive an internal audit to verify the effectiveness of your companies functioning today, by contacting a knowledgeable accountant in your area.

Does your business require an experienced CPA to assist you with an internal audit? Contact a CPA to represent your business for an internal audit today.

Investment Advisor

The advice of an experienced investment advisor can make a significant difference in the performance of your investment portfolio. The role of an investment advisor is to provide financial guidance to individuals or businesses and asset management consultation for their corporate clientele. The financial instruments that an advisor may assist with are generally related to hedge and/or mutual funds. However, there are many services that an investment advisor can provide to both individuals and businesses alike. Many CPA’s are qualified as investment advisors.

Do you or your business need an investment advisor that is an experienced CPA? Contact a CPA to act as an investment advisor for your business today.

Some of the areas that an investment advisor may handle are:

• Estate Planning
• Wealth Management
• Personal Financial Planning
• Investment Advisory Services
• Insurance & Risk Management
• Retirement & Wealth Preservation

The function of an investment advisor may change quite frequently based on the specific needs of the client. Each client requires advice on their own unique set of financial needs. Due to the diverse nature of the services that an individual or a business may require, there are investment advisors that focus their skills on specific areas of financial investment.

A knowledgeable and skilled investment advisor will carefully consider all of the factors that make up your unique investment scenario and provide you with direction and guidance in your financial endeavor. After contributing to the creation of an effective investment strategy, the advisor can provide continuing support and guidance by reviewing, rebalancing and monitoring your investments. If you are in need of the financial services that a professional accountant can provide, contact a CPA to guide you with your financial investments today.

Do you or your business need an investment advisor that is an experienced CPA? Contact a CPA to act as an investment advisor for your business today.

Richard Sennett Named Division of Investment Management Chief Accountant

Comptroller Weitzman Promotes Kathy Kugler to County Director of Accounting

Limited Partnership

One difference between a limited partnership (LPs) and a general partnership (GPs) is that along with one or more GPs there are also one or more LPs. The main difference is that LPs are responsible for limited liability in the company and they have no management responsibilities. Their liability is restricted to any debts acquired by the organization only to the degree of their portion of investment. LPs get paid according to their partnership agreement and usually consists of a dividend on their investment. LPs also differ from limited liability partnerships (LLP) in that LLP partners all have limited liability in the business.

Are you interested in investing in a limited partnership? Contact a certified and experienced accountant to evaluate your options in a limited partnership today.

LPs are required to file the appropriate documentation with the local state agency when the partnership is being created or incase of any changes to the partnership agreement. This is to distinguish them as a limited partner with limited liability in the company before the state. They must clearly divulge their partnership status when negotiating with others on behalf of the company to make it clear to the other party that they have a limited liability stake in the company. The company must also clearly identify who is a GP and a LP in any documentation, be it hard copy or electronic.

Rules of limited partnership:

• The general partner(s) has full management responsibility and runs the daily operations of the business.
• The limited partner(s) cannot incur responsibilities for the partnership.
• The limited partner(s) does not participate in the firm's daily operations.
• The limited partner(s) is only held liable for an equal share to his/her investment in the partnership.

Limited partnerships are very attractive to investors because of the limited liability they represent. The LP basically only serves to invest capital in the business and share in the profits to the extent of their investment. GPs have most of the power but they also hold the brunt of the liability should something go wrong. By the same token the GP has the freedom to run the business without interference. Should a limited partner decide to get more involved in the running and decision making of the company he/she runs the risk of being legally liable on equal footing with the general partner(s). In other words if a LP takes a more direct role in the daily operations of the business they will be held to the same liability obligations as a GP regardless of the contract he/she holds with the company.

Are you interested in investing in a limited partnership? Contact a certified and experienced accountant to evaluate your options in a limited partnership today.

Management Accounting

The primary purpose of management accounting is to provide a systematic process for decision making activities within a business. It gives upper management the ability to make informed decisions concerning administration and control performance. Unlike financial accounting, which is public, management accounting is usually confidential. This particular type of accounting extends to various areas of an organization including treasury, auditing, marketing, and logistics. The overall objective in management accounting is to create an analysis of a fixed approach to formulate business strategies that will produce more productive results.

Does your business need to improve its productivity or effectiveness through management accounting techniques? Contact a skilled and experienced CPA to assist your business with your management accounting needs today.

Management accounting defined by the American Institute of Certified Public Accountants (AICPA) includes the practices of:

• Risk Management
• Strategic Management
• Performance Management

Strategic management concerns advancement within the roles of management by utilizing sound business principles, tactics and the support of managerial accounting principles. Performance management focuses on developing better decision-making within the organization. Risk management seeks out potential risks which the business may encounter in the future. Furthermore, these practices assist in establishing a procedure of reporting and managing risks to the business in an effective manner. Consequently, all of these areas coalesce to further the value of an organizations framework. Contact a Certified Public Accountant (CPA) in your area today for more information on furthering your company’s performance, strategy and risk management efforts.

Does your business need to improve through management accounting practices? Contact a CPA to assist your business with management accounting today.

Mergers and Acquisitions

Mergers and acquisitions or M&A, is the buying, selling and joining of companies for the purpose of financial stability or expansion of a company to increase their long term profitability. A merger is the voluntary combination of two companies into one larger company, and may involve cash payment or an exchange of stock to the target company. An acquisition is the takeover by purchase of a target company by another. The takeover can be friendly, the two companies negotiate the purchase, or hostile, the target company is reluctant to the deal or their board has no prior information about the bid.

Is your company considering a merger or acquisition and need the professional guidance of a CPA? Contact one our skilled CPA’s today and get assistance you need for a fruitful transaction.

Mergers and acquisitions along with corporate restructuring play an integral part in the daily global corporate market. These transactions can involve billions of dollars and can have financial implications and consequences for investors, the stock market, board members and employees alike. Typically mergers transpire in a consensual situation, that is, executives from the target company assist the purchasing company in the process to guarantee that the transaction is beneficial to both companies. A hostile takeover can take place through the purchase of a majority of outstanding shares of the target company in the open market; this can happen against the wishes of that company’s board or it can happen without the knowledge of the target company. Corporate mergers can help in cutting costs, reducing taxes, consolidating staff, and reducing market competition. M&A’s require approval by the Federal Trade Commission and the Department of Justice. This is meant to prevent unfair trade practices or attempts to monopolize any area of the market by one or more companies conspiring to control any particular sector of the market.

Acquisitions:

• Control of the target company through the purchase of a majority of shares.
• The assets of the target company are purchased and the shareholders are paid and liquidated.
• Demerger is when one company is divided into two, generating a separately listed company on a stock exchange

Mergers:

• Horizontal merger is two companies merging that produce a similar product in the same industry.
• Vertical merger is the combination of two companies that are at different stages of production of the same commodity.
• Conglomerate merger is when the two companies operate in different industries.
• Reverse merger is a way of going public without the expenditure and time required by an IPO.

Is your company considering a merger or acquisition and need the professional guidance of a CPA? Contact one our skilled CPA’s today and get assistance you need for a fruitful transaction.

More Competitive Marketplaces For NYSE And Nasdaq

Speech by SEC Commissioner:
Commissioner Annette L. Nazareth
U.S. Securities and Exchange Commission
New York, NY: September 22, 2005
 

Within weeks of the adoption of Regulation NMS, the NYSE announced its intention to merge with Archipelago and Nasdaq announced its intention to merge with Instinet. The driving force behind these mergers appears to be the prospect of building stronger, more diverse, and more competitive marketplaces. In each case, the parties expect to combine the best features of each other's market to improve liquidity and executions and, of course, profits. NYSE and Archipelago seek to position the new entity as the preeminent global marketplace for equities, options, and other derivatives, providing additional growth opportunities and more choice for investors. Similarly, with its acquisition of Instinet and, previously, Brut, Nasdaq seeks to significantly deepen Nasdaq's liquidity pool and avail itself of Inet's lower-cost, more efficient platform for the Nasdaq Market Center. Nasdaq's goal is to increase efficiency, liquidity, and the opportunity for an execution on a Nasdaq trading system. It hopes to attract new listings and expand choices for investors accessing the Nasdaq market.

The marketplace's competitive response was not limited to the NYSE and Nasdaq. We have also seen proposals by various regional exchanges that are designed to provide an alternative trading venue to the two dominant markets. There has even been discussion of the creation of one or more new ECNs

Registered Agent

A registered agent is an individual that is charged with the responsibility of the handling of a corporation within a specific state. Every corporation is responsible for assigning a person as the registered agent for the company. There are no limitations as to which persons are eligible in becoming an agent for a company. However, the agent must be able to be contacted at a physical location during regular business hours.

Are you in need of a third party registered agent for your corporation? Contact a CPA regarding the assignment of a registered agent today.

Some other responsibilities that the registered agent may be in charge of handling are:

• Submission of Business Entity Reports
• Registration of employer identification records
• Filing annual reports for Tax Standing
• Responding to legal actions which regard the corporation entity

In most business situations, a registered agent is assigned at the time of the formation of the corporation. Another common practice is for a third party to act as a registered agent for the corporation in order to act as a shield of anonymity to the clients of the corporation from legal proceedings or actions that may develop. In the event there is a lawsuit or other civil liability against the business, the third party agent or agency will receive notification of the process and forward the matter over to the principal(s) of the company.

Other benefits to having a third party act as a registered agent of the company is for the management of financial filing and reporting responsibilities. For instance, if a corporation files a delinquent tax report, there may be serious financial and legal repercussions. A registered agent that takes on this type of roll is generally referred to as a Compliance Manager. For this reason, a CPA or a lawyer may be assigned as a registered agent.

Are you in need of a third party registered agent for your corporation? Contact a CPA regarding the assignment of a registered agent today.

Retirement Planning

Retirement planning is something you should consider before you retire, that sounds easy enough. But a recent study by the Employee Benefit Research Institute (EBRI) sites that 68 percent of workers age 25-34 have less than $25,000 set aside for retirement, as do 50 percent of workers age 35-44, and 30 percent of workers 44-55 and over. The 2007 Retirement Confidence Survey sites that, overall, almost half of all American workers have retirement savings and investments that total less than $25,000. The majority of workers who have not put money aside for retirement have very little in savings at all and seven out of ten of these workers admit their assets total less than $10,000.

Are you prepared for retirement planning? Contact an experienced CPA to create a strategy for your retirement planning today.

While planning for your retirement makes good financial sense, it turns out most of us living day to day find it hard to set aside the kind of money needed for a pleasant, work free retirement. The truth of the matter is that your golden years will be among you before you realize it and planning then becomes scrambling or doing without. We are so fixed and incased in the present that we forget or put-off planning for our future thinking we will always have time to catch up. But the reality is that the future has a way of creeping up on you and planning for it will make the difference between having enough for a comfortable life and struggling to stay financially independent. In a recent study, workers at American Express were surveyed and those who currently had help in financial planning were more realistic about the amount they needed to save for retirement and had more money saved, than those workers without financial planning help.

The survey found that workers that had retirement planning advice were less likely to feel they had to work after retirement:

• 22 percent of workers that did not have financial planning advice expect to work after retirement.
• 9 percent of workers that did have financial planning advice expect to work after retirement.

The EBRI study found that overall:

• 40 percent of people surveyed admitted they do not have a retirement savings account.
• 34 percent of people surveyed admitted they have no retirement savings at all.
• 25 percent of people surveyed admitted they have no savings what so ever.

Retirement planning can be the life blood for you and your family after you retire. Something else you might want to consider is setting up a Spousal IRA. If you are currently employed and have a non-employed spouse or your spouse has modest to no income, you may be able to set up and contribute to a Spousal IRA for your spouse. That will give both of you peace-of-mind and give you and your spouse more security and options for retirement.

Are you prepared for retirement planning? Contact an experienced CPA to create a strategy for your retirement planning today.

Roth IRA

A Roth IRA is a type of Individual Retirement Account named for Senator William Roth Jr. of Delaware. The Roth IRA is similar to traditional IRA’s. The major distinction is that Roth IRA contributions are made from earnings that have already been taxed therefore, they are not tax deductible. However, withdrawals up to the amount of the contributions are free from federal income tax and earnings above the contribution amount are usually free from income tax as well. A Roth IRA also has fewer investment restrictions than traditional IRA’s. A Roth IRA account can invest in securities like mutual funds, real estate, common stocks, derivatives, notes, and certificates of deposit. Like traditional IRA’s, capital gains, dividends, and interest are free from taxation.

Are you or someone you know considering a Roth IRA? Contact a Certified Public Accountant to find out if a Roth IRA is right for you and your family today.

There are limits on how much you can contribute to a Roth IRA retirement account, which is based on income and marital status.

Congress has limited contributions to a Roth IRA, based upon income:

• Single filers: Qualify for full contribution if earned income is up to $99,000.
• Single filers: Qualify for partial contribution if earned income is $99,000-$114,000.
• Joint filers: Qualify for full contribution if earned income is up to $156,000.
• Joint filers: Qualify for partial contribution if earned income is $156,000-$166,000.
• Married filing separately: Qualify for full contribution if earned income is up to $0. (If the couple lived together for any part of the year)
• Married filing separately: Qualify for partial contribution if earned income is $0-$10,000. (If the couple lived together for any part of the year)

The Roth IRA is more flexible than traditional IRA’s in many ways. One difference is that if you convert from a traditional IRA and to a Roth IRA, you are allowed to withdraw the total amount of the conversion after the seasoning period of five years is over. When a contributor turns 59.5 or becomes disabled they automatically qualify to withdraw the earnings if the account is seasoned. The holder, spouse, children or parents of the holder of the Roth IRA account can qualify for up to $10,000 of earning withdrawals for the purchase of a primary residence. If one spouse dies, and the couple own individual Roth IRA accounts, the surviving spouse can combine the two accounts without penalty. The Roth IRA is taxed before it is deducted for the retirement account, so it can’t be taxed at a higher rate when withdrawn, should you be in a higher tax bracket after retirement. The Roth IRA does not impose mandatory withdrawals as other types of IRA’s do after age 70.5 or once withdrawals begin after 59.5.

Are you or someone you know considering a Roth IRA? Contact a Certified Public Accountant to find out if a Roth IRA is right for you and your family today.

Sarbanes-Oxley Act

The Sarbanes-Oxley Act was signed into law in 2002, as a result of widespread misconduct within the hierarchy of corporate management. Prior to the act, many corporations habitually published deceptive and ambiguous financial reports resulting in remarkable losses for investors. The problem was made worse by the incessant denial of wrong doing or responsibility by the upper management of these companies, and their outside accounting and auditing firms. The most notorious of theses scams were Tyco, Enron, and WorldCom, but those were merely the largest or most publicized, the problem goes much further.

Is your company Sarbanes-Oxley compliant within the antitrust laws? Contact a CPA to make sure your business meets the Sarbanes-Oxley requirements today.

The act mandates stricter and more responsible accounting practices, which has lead to more financial transparency and accountability from companies and the economic reports they release. This regulation by the U.S. government has had a positive and reassuring result among investors and companies alike. Many financial exchanges in the U.S. have experienced a decline of new offerings because of the financial scandals that tore through the market in the early part of this century. Many American and foreign companies elected to issue their securities in overseas markets, in countries where regulations are viewed to be more “corporate friendly”, as a result of the ramped corruption. Holding upper management or their auditing companies accountable for the accuracy of their fiscal information has helped to restore consumer confidence in the investment market. Though the Act was signed into law quite hastily and various aspects of the law are not considered to have been thoroughly thought through. But new considerations have now been given to some provisions of the law and have been or will be debated again in the near future. Presently, delays in the comprehensive enforcement of the act are dependent upon those provisions facing amendment.

Sarbanes-Oxley sections up for consideration:

• Section 404
• Section 306
• Audit Committees
• Corporate Governance

Not considering any likely changes to the act in the near future, all companies are still held liable for damages and civil actions under the act. The Securities and Exchange Commission and the Justice Department must take initial legal action against companies suspected of violations of the Sarbanes-Oxley Act before any civil action can be taken on the part of investors. Protect yourself, your company and your assets by making sure your company complies with the act, that way you avoid any potential lengthy and costly litigation or even imprisonment.

Is your company Sarbanes-Oxley compliant within the antitrust laws? Contact a CPA to make sure your business meets the Sarbanes-Oxley requirements today.

SEC Approves PCAOB Auditing Standard No. 5 Regarding Audits of Internal Control Over Financial Reporting; Adopts Definition of "Significant Deficiency"

SEC Charges 14 in $64 Million Penny Stock Scheme

The SEC complaint alleges that CMKM Diamonds, Inc., with assistance from a transfer agent and an attorney, fraudulently issued hundreds of billions of shares of purportedly unrestricted stock to the scheme's mastermind. The complaint also alleges that CMKM's CEO Urban Casavant generated investor interest in the company through false press releases, Internet chat boards, and "funny car" race events across the country without disclosing that he ran the company from his house in Las Vegas and that CMKM's primary activity was to issue and promote its own stock.

Linda Chatman Thomsen, Director of the SEC's Division of Enforcement, said, "The perpetrators of this massive scheme include several securities professionals and an attorney. Today's action demonstrates that we will aggressively pursue individuals who ignore their obligations as gatekeepers to our markets and instead collude with their clients to violate the federal securities laws."

Rosalind R. Tyson, Acting Regional Director of the SEC's Los Angeles Regional Office, added, "The allegations in this case highlight the significant investor harm that results from abuses in the penny stock market. Although CMKM's stock sold for well under a penny a share, the defendants were able to reap millions in profits by conspiring to flood the market with billions of unregistered shares while falsely promoting CMKM's value."

The SEC's complaint charges CMKM, the broker-dealer and transfer agent involved, and 11 individuals including Casavant. The mastermind of the scheme, John Edwards, who was living in Las Vegas, and others allegedly sold their unregistered shares into the public markets for a profit of at least $64.2 million, much of which was paid to Casavant to support his extravagant lifestyle. The complaint alleges that Edwards profited by approximately $26.4 million from sales through a single broker-dealer. Casavant profited by approximately $31.5 million, and others Casavant recruited profited by approximately $6.3 million, according to the complaint.

The SEC's complaint, filed in U.S. District Court for the District of Nevada, alleges that from January 2003 to May 2005, CMKM improperly issued up to 622 billion shares of purportedly unrestricted stock. These issuances allegedly were based in large part on both written authorizations and attorney opinion letters prepared by Brian Dvorak, CMKM's lawyer, which were often inadequate, suspect, and inconsistent. Nonetheless, the complaint alleges that based on these faulty documents, CMKM's transfer agent, 1st Global Stock Transfer LLC, and its owner, Helen Bagley, issued stacks of stock certificates without restrictive legends.

The SEC's complaint alleges that Edwards, his associates Kathleen Tomasso and Anthony Tomasso, and Casavant's cohorts James Kinney and Ginger Gutierrez then deposited the certificates with various broker-dealers and sold the shares into the market. NevWest Securities Corporation and its employees, Anthony Santos, Sergei Rumyantsev, and Daryl Anderson, are alleged to have sold more than 259 billion shares of CMKM stock for Edwards, despite numerous red flags indicating a massive unregistered distribution.

The SEC charged all of the aforementioned participants with violating the registration provisions of the federal securities laws. In addition, the Commission charged CMKM and Casavant with violating the antifraud and various reporting, record keeping, and internal controls provisions.

The SEC seeks a permanent injunction against all defendants and an accounting, disgorgement with prejudgment interest, and civil penalties against all of the defendants except CMKM. In addition, the Commission seeks a penny stock bar against each of the individuals and an order prohibiting Casavant from acting as an officer or director of any public company.

The Commission acknowledges the assistance of the Financial Industry Regulatory Authority (FINRA) and the Saskatchewan Financial Services Commission in this matter.

SEC Charges 69 Audit Firms and Partners for Issuing Audit Reports While Not Registered with the PCAOB

SEC Charges Microtune and Former Officers for Stock Option Backdating

The SEC's complaint, filed June 30 in the federal district court for the Northern District of Texas, alleges that former Microtune Chairman and CEO Douglas J. Bartek, with assistance from former Chief Financial Officer and General Counsel Nancy Richardson, routinely misrepresented the date on which he granted stock options to senior executives and other employees. To conceal the alleged scheme, Bartek directed others to backdate employment records, including offer letters, to establish falsified start dates and grant dates that preceded the actual dates when the new hires began working for Microtune.

Microtune has agreed to settle the SEC's charges. The SEC's case against Bartek and Richardson continues, with the Commission seeking financial penalties and other relief under the "clawback" provision (Section 304) of the Sarbanes-Oxley Act to deprive corporate executives of money that they wrongfully earned while their companies were misleading investors.

"This action reaffirms our commitment to pursue those who perpetrate financial fraud and the corporate gatekeepers who allow it to happen on their watch," said Rose Romero, Director of the SEC's Fort Worth Regional Office. "The alleged array of fraudulent conduct by Microtune's former officers, including the backdating of nearly every new-hire stock option grant, and backdating of large block grants, deprived the market of accurate information regarding executive compensation and the company's accounting for stock options."

According to the SEC's complaint, the undisclosed backdating scheme ensured that the options falsely appeared to have been granted on dates in the past corresponding to low stock prices, thus resulting in potentially lucrative "in-the-money" options granted at below fair market value. The SEC alleges that rather than report compensation expense to shareholders, as required at the time by U.S. Generally Accepted Accounting Principles, Bartek and Richardson falsified or directed others to falsify stock option records to make it appear that the backdated options were granted as of the backdated date, and therefore "at-the-money."

The SEC's complaint further alleges that Bartek and Richardson caused Microtune to grant backdated options, cancelling those options after the company's stock price dropped precipitously, and subsequently re-granting the same options at a substantially lower exercise price. According to the SEC's complaint, the re-grants were not, as required, accounted for using variable accounting, in part because Richardson and Bartek allegedly concealed the nature of the re-grants from Microtune's outside auditors and others.

Microtune, without admitting or denying the allegations in the SEC's complaint, has agreed to settle the matter by consenting to a permanent injunction against violations of the antifraud, financial reporting, books and records, internal controls and proxy provisions of the federal securities laws. The SEC's settlement with Microtune was based in part on Microtune's swift and extraordinary cooperation in the SEC's investigation.

The SEC's complaint alleges that Bartek and Richardson violated or aided and abetted violations of the antifraud, financial reporting, books and records, internal controls, lying to auditors, and proxy provisions of the federal securities laws. The complaint also alleges that Bartek and Richardson violated Exchange Act Rule 13a-14 by signing certifications required by Section 302 of the Sarbanes-Oxley Act of 2002 that were false and misleading. The Commission seeks against Bartek and Richardson injunctive relief, disgorgement of wrongful profits, civil monetary penalties, officer and director bars, and reimbursement of profits from stock sales pursuant to Section 304 of the Sarbanes-Oxley Act.

SEC Charges Two Former Accounting Firm Employees with Insider Trading

The Securities and Exchange Commission today charged two former San Francisco-area employees of PricewaterhouseCoopers LLP (PwC) with insider trading.

According to the Commission’s complaint, Gregory B. Raben, 30, a former PwC auditor, and William Patrick Borchard, 28, a former senior associate in PwC’s Transaction Services Group, used their access to sensitive information about PwC’s clients to allow Raben to buy stock ahead of a series of corporate takeovers. Without admitting or denying the allegations, Raben and Borchard agreed to a settlement including monetary penalties.

“Today’s charges of insider trading by accounting firm employees are another example of the Commission’s commitment to exposing insider trading by industry professionals who have access to confidential market information unavailable to the investing public,” said Linda Chatman Thomsen, Director of the SEC’s Division of Enforcement.  “Raben and Borchard violated PwC’s rules on keeping client information strictly confidential and ignored their duties to their employer and its clients,” added Marc Fagel, Co-Acting Regional Director of the SEC’s San Francisco Regional Office.

The Commission’s complaint, filed in federal district court in San Francisco, alleges that Borchard learned about the potential acquisition plans of PwC clients through his position in the Transaction Services Group, where he handled financial due diligence for clients interested in mergers or acquisitions. On six separate occasions in 2006, Borchard told his friend and co-worker Raben about these confidential plans. Raben then used the information to trade before the news was released to the investing public. The pair’s scheme continued until October 2006, when it was uncovered by PwC’s Office of General Counsel, which referred the matter to the Commission and cooperated with the SEC staff’s investigation.

According to the Commission’s complaint, Raben netted unlawful trading profits of more than $20,000 by buying stock ahead of public announcements disclosing the acquisitions and then selling his shares. Raben also tipped two other acquaintances about two of the acquisitions, allowing them to make several thousand dollars in unlawful trading profits.

Raben (now of Louisville, Ky.) has agreed to a permanent injunction from further violations of the antifraud provisions of the federal securities laws. He will disgorge his trading profits and those of the two acquaintances he tipped, altogether totaling $23,879.22, and will pay a civil penalty of $23,879.22. Borchard (now of Chicago), a licensed Certified Public Accountant, has consented to a permanent injunction and a civil penalty of $20,835.57 (equal to Raben’s trading profits), as well as an order denying him the privilege of appearing or practicing before the Commission as an accountant, with the right to apply to resume appearing or practicing before the Commission after three years.

SEC Enforcement Division Announces Preliminary Settlement With Merrill Lynch to Help Auction Rate Securities Investors

In addition to helping individual investors, small businesses, and charities who were ARS customers of Merrill Lynch, the preliminary settlement also would require Merrill Lynch to use its best efforts to provide liquidity for approximately $1.5 billion worth of ARS purchased through Merrill Lynch by other business and institutional customers. The terms of the settlement are subject to finalization, review and approval by the Commission.

The proposed charges involve alleged misrepresentations by Merrill Lynch to thousands of its customers that ARS were safe, highly liquid investments equivalent to money market instruments and cash. Merrill Lynch did not make adequate disclosures that the liquidity of these securities was based on Merrill Lynch supporting the auctions it managed when there was not enough demand. Investors were left holding illiquid securities when Merrill Lynch stopped supporting auctions in February 2008. Furthermore, Merrill Lynch continued to tout the purported liquidity of ARS to customers despite its awareness of the escalating liquidity risks in the weeks and months preceding the collapse of the ARS market.

"Merrill Lynch's conduct harmed tens of thousands of investors who will have the opportunity to get their money back through this agreement pending Commission approval," said Linda Chatman Thomsen, Director of the SEC's Division of Enforcement. "We will continue to aggressively investigate wrongdoing in the marketing and sale of auction rate securities, and will seek prompt and meaningful relief to auction rate securities investors as a top priority."

Under the terms of the agreement in principle:

• No later than Oct. 1, 2008, Merrill Lynch will offer to liquidate at par all ARS from individual, charitable, and small business investors with account values up to $4 million who purchased ARS from Merrill Lynch prior to the collapse of the ARS market in mid-February 2008. This offer will include investors who held ARS in their Merrill Lynch account as of Feb. 13, 2008, but who subsequently transferred the account to another firm. The offer will remain open until Jan. 15, 2010, and investors may accept it at any time before that date.

• No later than Jan. 2, 2009, Merrill Lynch will offer to liquidate at par all ARS from remaining individual and charitable investors, and from small businesses with account values up to $100 million who purchased ARS from Merrill Lynch prior to the collapse of the ARS market in mid-February 2008. This offer will include investors who held ARS in their Merrill Lynch account as of Feb. 13, 2008, but who subsequently transferred the account to another firm. The offer will remain open until Jan. 15, 2010, and investors may accept it at any time before that date.

• Until Merrill Lynch actually provides for the buy back of ARS on the schedule set forth above, Merrill Lynch will provide certain investors no cost loans that will remain outstanding until the ARS are repurchased or until an investor declines Merrill Lynch's offer to repurchase the securities at par.

• Merrill Lynch will reimburse customers for costs incurred under any prior loan programs the firm provided to its ARS investors.

• Merrill Lynch will make whole any losses sustained by any of the investors described above who sold ARS after Feb. 13, 2008, at a loss.

• To the extent that any of the investors described above has incurred consequential damages due to the loss of liquidity in the customer's ARS holdings, Merrill Lynch will participate in a special arbitration process that the investor may elect, and that will be overseen by the Financial Industry Regulatory Authority (FINRA), whereby Merrill Lynch will not contest liability for its misrepresentations and omissions concerning ARS.

• Merrill Lynch will use its best efforts to provide liquidity to its ARS institutional customers and business customers with accounts of more than $100 million by the end of 2009.

• Merrill Lynch will not liquidate its own inventory of a particular ARS before it liquidates investors' holdings in that security.

• Merrill Lynch will provide notice to all of its ARS investors of the settlement terms and will establish a telephone assistance line to respond to questions from investors concerning the settlement.

• Merrill Lynch will be permanently enjoined from violating the provisions of Section 15(c) of the Securities Exchange Act of 1934, and Rule 15c1-2 thereunder, which prohibit the use of manipulative or deceptive devices by broker-dealers.

• Merrill Lynch faces the prospect of a financial penalty to the SEC after it has completed its obligations under the settlement agreement. A determination as to the amount of the penalty, if any, will take into account, among other things, the extent of Merrill Lynch's misconduct in marketing and selling ARS, an assessment of whether Merrill Lynch has satisfactorily completed its obligations under the settlement, and the costs incurred by Merrill Lynch in meeting those obligations, including penalties incurred and the cost of remediation.

The SEC notes the substantial assistance and cooperation from the Massachusetts Secretary of State, the North American Securities Administrators Association, the New York Attorney General and FINRA.

SEC propose "Giant Step Forward" for Municipal Bond Investors

Currently, retail investors in municipal securities usually cannot get ongoing disclosure information about their securities without paying significant fees and waiting for the documents to come in paper form by mail or fax. Issuers of municipal bonds submit their disclosures, such as annual financial data and information about material events including downgrades or notices of default, to a variety of for-profit information repositories that then sell it to the public. This severely limits its availability to retail investors.

The rule amendments proposed by the SEC would designate the Municipal Securities Rulemaking Board (MSRB) as the central repository for ongoing disclosures by municipal issuers. Under a separate MSRB-proposed rule change, its Electronic Municipal Market Access (EMMA) system would make these disclosures available to investors for free on the Internet in the same way the SEC's EDGAR system does for corporate disclosures.

"These proposals would bring dramatic improvements in disclosure to investors in municipal securities," said SEC Chairman Christopher Cox. "Retail investors — who own two-thirds of municipal securities — will soon have the same one-stop, cost-free, instant electronic access to disclosure documents about municipal bonds that they've long had for corporate stocks and bonds. This is a giant step forward for municipal bond investors."

MSRB Chair Frank Chin added, "The centralized collection and dissemination by the MSRB of ongoing financial documents will allow fair and equal access to information about municipal issuers and their bonds. EMMA will give investors an efficient and easy way to get key data about issuers as soon as it becomes available."

Public comment on the SEC's proposed amendments to Rule 15c2-12 under the Securities Exchange Act of 1934, as well as public comment on the MSRB's proposed rule change should be received by the Commission no later than 45 days after their respective publication in the Federal Register.

SEC Proposes Comprehensive Reforms to Bring Increased Transparency to Credit Rating Process

"The events of recent months have had a profound effect on our economy and our markets, and they have galvanized regulators and policymakers not only in this country but around the world to re-examine every aspect of the regulatory framework governing credit rating agencies," said SEC Chairman Christopher Cox. "This package of proposed rules would foster increased transparency, accountability, and competition in the credit rating agency industry for the benefit of investors."

Erik Sirri, Director of the SEC's Division of Trading and Markets, said, "The rules proposed today are designed to improve investor understanding of credit ratings through enhanced disclosure of NRSRO methods and performance data, and to promote investor confidence in credit ratings by minimizing conflicts of interest."

The proposed rulemaking continues the implementation of new regulatory authority that the SEC recently received from Congress to register and oversee nationally recognized statistical rating organizations (NRSROs). Since its authority went into effect in September 2007, the SEC has rigorously applied its new oversight to examine how credit ratings have been created and disseminated. Informed by these ongoing examinations as well as input from international regulatory organizations studying these issues and the Congressional committees responsible for the recent Credit Rating Agency Reform Act, the Commission has proposed this package of rules that would regulate the conflicts of interests, disclosures, internal policies, and business practices of credit rating agencies.

The regulatory program established by Congress through the Credit Rating Agency Reform Act allows the SEC to promulgate rules regarding public disclosure, recordkeeping and financial reporting, and substantive requirements designed to ensure that NRSROs conduct their activities with integrity and impartiality. These additional proposed rules supplement initial rules implemented by the Commission under the Act in June 2007.

The Commission is proposing the rulemaking in three parts, with the first two portions being proposed today and the third portion to be considered on June 25.

The first part of the Commission's rule proposal would:

• Prohibit a credit rating agency from issuing a rating on a structured product unless information on assets underlying the product was available.

• Prohibit credit rating agencies from structuring the same products that they rate.

• Require credit rating agencies to make all of their ratings and subsequent rating actions publicly available. This data would be required to be provided in a way that will facilitate comparisons of each credit rating agency's performance. Doing this would provide a powerful check against providing ratings that are persistently overly optimistic, and further strengthen competition in the ratings industry.

• Attack the practice of buying favorable ratings by prohibiting anyone who participates in determining a credit rating from negotiating the fee that the issuer pays for it.

• Prohibit gifts from those who receive ratings to those who rate them, in any amount over $25.

• Require credit rating agencies to publish performance statistics for 1, 3, and 10 years within each rating category, in a way that facilitates comparison with their competitors in the industry.

• Require disclosure by the rating agencies of the way they rely on the due diligence of others to verify the assets underlying a structured product.

• Require disclosure of how frequently credit ratings are reviewed; whether different models are used for ratings surveillance than for initial ratings; and whether changes made to models are applied retroactively to existing ratings.

• Require credit rating agencies to make an annual report of the number of ratings actions they took in each ratings class, and require the maintenance of an XBRL database of all rating actions on the rating agency's Web site. That would permit easy analysis of both initial ratings and ratings change data.

• Require the public disclosure of the information a credit rating agency uses to determine a rating on a structured product, including information on the underlying assets. That would permit broad market scrutiny, as well as competitive analysis by other rating agencies that are not paid by the issuer to rate the product.

• Require documentation of the rationale for any significant out-of-model adjustments.

The second part of the Commission's proposal would require credit rating agencies to differentiate the ratings they issue on structured products from those they issue on bonds, either through the use of different symbols, such as attaching an identifier to the rating, or by issuing a report disclosing the differences between ratings of structured products and other securities.

The third set of recommendations for the Commission's proposal, to be considered on June 25, are being designed to ensure that the role the SEC has assigned to ratings in its rules is consistent with the objective of having investors make an independent judgment of risks and of making it clear to investors the limits and purposes of credit ratings for structured products.

Public comments on today's proposed amendments and rule must be received by the Commission within 30 days after their publication in the Federal Register.

SEC Takes Action to Halt Online Account Intrusion and Identity Theft Scheme

The Securities and Exchange Commission today took action to stop a sophisticated Internet scheme that stole the identities of unsuspecting individuals and netted more than $66,000 in illicit profits in just seven weeks.

In a complaint filed in the U.S. District Court for the Eastern District of New York, the SEC alleged that one or more unknown traders conducted their entire online account intrusion scheme over the Internet and concealed their identities by, among other things, fraudulently opening brokerage accounts in the names of individuals who responded to a job advertisement on the Web site Craig’s List.

“While con artists continue to find new ways to defraud online brokerage customers, our efforts to protect U.S. investors from these account intrusion schemes continue to be a top priority of the Enforcement Division,” said Linda Chatman Thomsen, Director of the SEC’s Division of Enforcement.

“Even when hackers hide behind stolen identities, this case shows that SEC action can take the profitability out of the scheme, “ said David Nelson, Regional Director of the Miami Regional Office. “While our main focus is on the securities law violators, there is a reminder here about how important it is to safeguard personal identifying information.”

According to the SEC’s complaint, the unknown traders posted an advertisement on Craig’s List beginning in February 2007 for a job with a fictitious Latvian brokerage firm, AWE Trading, Inc. Individuals who responded to the advertisement provided their personal information, including social security numbers and dates of birth to AWE via the Internet for purported company background checks. The unknown traders then used this personal information to open securities trading accounts online at Interactive Brokers LLC without the individuals’ knowledge.

The SEC’s complaint further alleges that, on multiple occasions between March 8 and April 24, 2007, the unknown traders gained unauthorized, online access to accounts held by customers of various retail brokerage firms. They purchased and sold at least 18 securities listed on the New York Stock Exchange and NASDAQ. The unknown traders simultaneously bought and sold the same securities in the accounts they opened fraudulently, profiting from the change in trading volume and stock prices generated by the unauthorized transactions.

The SEC’s complaint charges the unknown trader defendants with violating Section 17(a) of the Securities Act of 1933 and Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934 by engaging in the complex securities account intrusion scheme. The complaint also seeks a final judgment permanently enjoining the unknown traders from further violations of the securities laws and ordering them to repatriate assets of the fraudulent scheme they hold outside the U.S., to disgorge their ill-gotten gains, and to pay civil money penalties. The Commission’s complaint identifies Interactive Brokers, which fully cooperated in the staff’s investigation, as a relief defendant because it currently holds cash and securities related to the scheme. In April 2007, Interactive Brokers detected suspicious trading in the involved accounts, suspended activity and froze the funds in the account.

Visit www.sec.gov for more information.

Self-Directed IRA

A self-directed IRA account or a, "Checkbook Individual Retirement Account", is a retirement account that requires the account owner to invest earnings on behalf of the retirement plan. Self-directed IRA accounts are normally not restricted to a select group of asset types and most self-directed IRA custodians will permit clients to invest in most investments acceptable by the IRS. Generally the custodian or trustee will manage the assets, make transactions and keep records relevant to the account, from how to manage the tax obligations to regulations and prohibited transactions. They perform other administrative tasks and responsibilities on behalf of the owner of the self-directed IRA for the term of the IRA account. It is imperative that individuals interested in self-directed IRAs work closely with a qualified and experienced IRA custodians. Regulations imposed by the IRS require that a qualified trustee or custodian hold the IRA assets on behalf of the IRA holder. Self-directed IRA accounts permit investors to diversify their portfolio outside of stock market investments and into less risky and more lucrative investment options.

Do you need help in setting up a self-directed IRA account? Contact an experienced CPA today and set your retirement funds in the right direction.

Some investment options permitted under the IRS regulations include: domestic and foreign real estate, mortgages, loans/notes, foreign currency exchange, stocks, mutual funds, personal business, franchises, partnerships, tax deeds, and tax liens. Many individuals choose to invest IRA funds into real estate for the potential of a higher rate of return, in hopes of hastening the value of their IRA. This may include: apartments, single family homes, multi-family homes, commercial properties and raw land. This type of IRA account can afford a new or existing business with a valuable source of capital. The investor does not incur additional debt or monthly payments, and the profits continue to accrue on a tax deferred basis. Self-directed IRAs advance the investors opportunities to diversify their IRA portfolio, by permitting a wide range of investment options.

If the IRA owner is younger than 59.5, the account will be subject to an early withdrawal penalty of 10 percent. Self-directed IRA accounts may permit earnings to be placed into a checking account, making the funds more liquid. This type of retirement fund gives investors checkbook control of earnings, permitting them to invest how they choose.

Two types of traditional IRAs:

• Deductible – allows you to deduct all or part of your contributions from your taxable income.
• Nondeductible - you may be able to entirely or partially deduct your contribution if your adjusted gross income qualifies and you have another retirement plan at work.

Contributions limits:

• Age 50 and younger is $4,000.
• Age 50 and above is $5,000.
• Single/head of household your AGI cannot surpass $60,000.
• Married and filing jointly your AGI cannot surpass $85,000.

You may qualify for a full or partial deduction if you are married and file jointly and your AGI is below $160,000 and you're not covered by a retirement plan, but your spouse is. You may be eligible to contribute to a Roth IRA if you are single and your AGI is below $110,000 or $160,000 if you're married filing jointly. A nondeductible IRA is a viable option if you are not eligible for a deductible IRA, your contribution will not be deductible but your savings will grow tax-deferred.

Do you need help in setting up a self-directed IRA account? Contact an experienced CPA today and set your retirement funds in the right direction.

SEP IRA

A SEP IRA is a Simplified Employee Pension retirement plan that offers employers an easy way to make contributions towards an employee retirement program. If self-employed, it allows for a personal retirement plan. Contributions are made directly to an Individual Retirement Account (IRA) or Annuity set up for each individual employee. The SEP is a simplified IRA, even more so than the SIMPLE IRA. There are no administrative costs if you are self-employed and don't have employees. If you are self employed and you do have employees, all employees must receive equal benefits under a SEP plan. Since SEP accounts are treated as an IRA, funds can be invested like any other type of IRA. The SEP IRA is owned and managed by the employee and the employer sends the SEP contributions to the financial institution where the account is maintained. The account can be set up to an individual’s business even if he/she participates in another employer's retirement plan.

Do you need help setting up a SEP retirement plan for your employees? Contact a skilled CPA for help setting up your SEP today.

There are three basic steps in setting up a SEP IRA:

• A formal written contract must be implemented. This contract may be satisfied by adopting an IRS model SEP, a prototype SEP or an individually designed SEP.
• Every eligible employee must be given specific information regarding the SEP.
• An individual SEP IRA must be set up for every eligible employee with a bank, insurance company, or other qualified financial institution.

The employees must meet the following criteria:

• Must be at least 21 years old.
• Must have worked for the employer for at least three out of the previous five years.
• Must have received at least the minimum compensation for that tax year.

SEP IRA contributions are seen as a profit-sharing plan. For employees, an employer may contribute up to 25 percent of each employee's wages to their SEP IRA account. The total contribution to a SEP IRA account is either 25 percent of the income or a pre-set total for each year, the amount is indexed for inflation, whichever is smaller. For self-employed people the amount is 20 percent before the self-employed tax credit is added. The maximum deduction is 25 percent of all members’ compensation. Limits apply collectively to the contributions an employer makes for its employees to all the defined contribution programs, which includes SEPs and are specific for each year. They are subject to annual cost-of-living adjustments. If an employer contributes to another defined contribution plan for its employees like, a 401(k), a yearly addition limit may apply. Contributions are not mandatory to be made each year, but in the years when contributions are made, they must be made to the SEP IRAs of all eligible employees. SEP- retirement plan funds are taxed at ordinary income tax rates when qualified withdrawals are taken after age 59.5. Contributions to a SEP plan are tax deductible and will lower a taxpayer's income tax liability for that year. Contributions to an employee’s SEP IRA are not included in their gross income, except for excess contributions. Excess contribution and earnings on the excess contribution amounts are subject to a 6 percent excise tax unless they are withdrawn before the due date for filing their next tax return.

Do you need help setting up a SEP retirement plan for your employees? Contact a skilled CPA for help setting up your SEP today.

SIMPLE IRA

SIMPLE IRA stands for Savings Incentive Match Plan for Employees. An Individual Retirement Account (IRA) is a type of employer-provided plan which is a form of salary reduction plan structured for qualifying small businesses so they may offer retirement to their employees. Businesses with 100 employees or less, earning $5,000 or more a year that do not offer any other retirement benefits plan qualify to offer a SIMPLE IRA. Self-employed workers can also qualify to create this type of IRA account. Employers must make a matching contribution or a fixed "non-elective" contribution to their employees' accounts every year. If the business owner chooses matching contributions, they must match the amount the employees’ contribution up to 3 percent. The employer may choose to make a non-elective contribution of 2 percent of the wages for each eligible employee.

Are you or someone you know considering a SIMPLE IRA and need the help of a qualified CPA? Contact an experienced CPA to make an informed decision about your retirement plan today.

A SIMPLE IRA is a qualified plan, very similar to other better known retirement plans, but it offers easier rules and is less expensive to administer. The plan is funded by a pretax salary reduction and the contribution limits are lower than most other types of employer-provided retirement plans.

Types of retirement plans:

• 401k
• 403b
• 457 Plan
• SEP IRA
• 529 Plan
• Roth IRA

Contributions to your traditional IRA can be made from your simple IRA at any time during a certain year or by the due date for filing your tax return for that year, excluding extensions. SIMPLE IRA plans can only be set up by an eligible employer. The plan has to have a minimum contribution from the employer to qualify. There is a catch-up provision available for participants over age 50. The permissible catch-up contribution is $2,500. A SIMPLE IRA cannot be rolled over to a traditional IRA without a two year waiting period. You may contribute up to $10,000 per year into the account if you are younger than 50, if you are older you can contribute up to $12,500. Your contributions are excluded from taxable pay on your W-2 and can not be considered for income tax withholding, but Social Security taxes do have to be paid on those earnings. The employer chooses the financial institution into which the deposits are made but the employees have the right to transfer the funds to the financial institution of their choice without fees or penalty.

Are you or someone you know considering a SIMPLE IRA and need the help of a qualified CPA? Contact an experienced CPA to make an informed decision about your retirement plan today.

State Government Raises the Bar (and Salary) for Accountants

The State Personnel Board unanimously passed a motion this morning to rewrite the qualifications and salary classifications for accountants, auditors and budget analysts in state government. The statewide upgrades will allow the state to recruit, hire and retain top financial employees.

“SMART Governing requires that the State be competitive in recruiting and retaining financial personnel, and this action will help achieve that goal,” said Finance Director James Allen Main. The SMART Governing cycle, managed by the state Finance Department, is designed to improve Alabama Government by requiring organizational planning, linking plans to budget requests and appropriations, and creating meaningful performance measurements. The acronym stands for Specific results, Measurable key goals, Accountable to stakeholders, Responsive to customers, and Transparent to everyone.

This rewrite, the state’s largest classification overhaul since the early 1990s, will have minimal impact on current employees in financial positions. However, those meeting the new requirements will receive the same pay increase as new hires in these positions.

Bob Childree, State Comptroller, stated, “I really appreciate the visionary outlook of the State Personnel Board in providing the state of Alabama with the necessary tools to acquire the best financial employees that are available.” The future accountability of the state of Alabama is very critical; this will allow us to support both SMART and Governor Riley’s commitment to full accountability.

The proposed, more stringent requirements and enhanced pay structure were the recommendation of a task force of fiscal officers. Main spoke on behalf of the new structure before the State Personnel Board this morning.

Tax Planning

Tax planning, is possibly the most essential and consistent financial issue you will face, yet, if you know what to consider or how to plan when preparing for your taxes, it does not have to be the dismal task that bewilders most people. It is essential to stay on top of your tax obligations and responsibilities. Whether you are an individual tax payer, or a business entrepreneur; an experienced Certified Public Accountant has the ability to make your financial undertakings more profitable and beneficial. Tax planning is the method of analyzing and organizing your taxes to optimize tax options and to establish a program to help you save the most money while meeting all your tax obligations. The tax laws are designed to permit you to take the necessary steps to ensure you are paying the minimum amount of taxes that you are responsible for within the IRS’s legally established regulations. It is perfectly legal to find the method of tax preparation that saves you the most money.

Do you need the advantage of strategic tax planning? Contact a certified public accountant to help you with tax planning today.

Any number of unintended oversights on your tax return can put you on an audit list or set you up for fees and penalties. If you fail to meet a deadline, omit information, or declare an undue deduction you could face unintended consequences. Regardless of how innocent the oversight might be on your part. It is your responsibility to be aware of the tax laws and any changes to the tax laws no matter how bewildering they might be. The IRS or an auditor will not give you the benefit of the doubt when it comes to fees, penalties, or interests owed due to personal mistakes.

IRS Examiners look for certain behaviors for possible tax fraud or audit:

• Failure to report significant amounts of income.
• The claim of false or flawed deductions.
• Accounting carelessness or failure to keep sensible financial records.
• Controversial allotment of earnings to a related taxpayer in a lower tax bracket.

Having a certified public accountant on your side can make all the difference when allocating and claiming deductions or avoiding tax pitfalls or mistakes. An accountant can help you understand how deductions apply to you, advise you on how to keep a larger portion of your earnings, or even give you new insights on how to avoid problems in the future. Our accountants have a comprehensive understanding of the tax laws and can help you structure your financial statements to make the most of your tax situation.

Do you need the advantage of strategic tax planning? Contact a certified public accountant to help you with tax planning today.

Trust Fund

A trust fund is generally associated with a wealthy and prosperous individual. But in reality, a trust can be an efficient and effective method of managing assets for just about anyone. Any type of asset can be held in a trust. A trust can be created while a person is alive or it can be created through a will after death. The person who creates the trust is the grantor, donor or settlor. The individual or entity that will oversee or manage the trust is the trustee. The owner of the trust is the beneficiary, which is the beneficial or equitable owner of the trust and can be one or more people or entity. The beneficiary will receive the income or assets from the trust immediately or in the future, it can also be structured to deliver payments at intervals. If multiple beneficiaries are to receive assets from a trust the pay-outs can be structured individually.

Do you need to structure a trust fund? Contact an experienced CPA to help you secure a trust fund today.

Trusts can take on many facades and are used by everyone from individuals and government to corporate entities and charities they can be structured for payments of pensions, inheritance, legal settlements, etc.

Different structures of a trust fund:

• Privacy – Many people create a trust for the privacy it affords the grantor and the beneficiary. While wills are public information trusts are not, therefore allowing more privacy to the families or organizations involved.
• Wills or Estate Planning –The most common use of a trust is in a will for the reason of estate planning and distribution of assets. The assets can be held until the beneficiary is of a certain age or certain stipulations are met.
• Charities – Different jurisdictions have varying rules for charities but regardless of the local regulations, trusts are a simple and effective way for philanthropists to ensure their legacy will continue to provide for people in need. 
• Self-control – Some people create a trust to ensure they don’t squander money. An inter-vivos trust can be created to disburse funds only for reason expressed in the trust agreement.
• Unit Trust – Is a form of cooperative investment comprised under a trust deed. The concept for this type of trust is so flexible that it is used as an investment vehicle.
• Corporate Structures – Finance and insurance agreements usually use trusts to structure payment plans and business arrangements. 
• Pension Plans – Are another way trusts are used to structure payments from grantor (employer), to the beneficiary (employee).
• Asset Protection – A discretionary trust can offer protection from creditors in case of financial hardship by separating the individual form the assets in the trust fund, even if the individual is forced to file bankruptcy. This type of trust can also save a considerable amount on inheritance tax.
• Tax Planning – Setting up a trust fund for your survivors offers a couple of benefits from your desired distribution of assets to reducing the inheritance tax burden for your beneficiaries. 

Our experienced and capable accountants can set up a trust fund to satisfy your needs and desires for stable and systematic distribution of your assets to those that matter most in your life, offering you and your loved ones the confidence and peace-of-mind that comes from knowing your wishes will be carried out according to your specifications.

Do you need to structure a trust fund? Contact an experienced CPA to help you secure a trust fund today.