Attestation Update – A&A for CPAs

Technical stuff for CPAs providing attestation services

Archive for the ‘Accounting’ Category

Like a persistent vampire in a horribly bad horror movie, IFRS just won’t stay dead in the U.S.

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Image courtesy of Adobe Stock.

I thought IFRS in the US was dead. In case you didn’t know, I have a fairly strong opinion on the issue.

A presenter at the CalCPA’s Accounting and Auditing Conference on April 25, 2017 had the following comment on IFRS at the end of the presentation:

Death, taxes, cockroaches, and IFRS aren’t going away.

My immediate thought:

Unfortunately, that now seems to be true.

IFRS is baaaack

He perceives the pendulum of discussion on IFRS is swinging back to the topic being on the table.

His comments consistently contained the inference that IFRS is one body of knowledge, consistent in its application in every country across the planet that has adopted the rules.

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Written by Jim Ulvog

April 26, 2017, 7:15 am at 7:15 am

Posted in Accounting, Audits

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Staying ahead of change in the CPA profession

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We need to be ready for what’s around the curve. We will be there really soon whether we want to or not. Image courtesy of Adobe Stock.

In the short-term, looks like a shortage is emerging for experience accountants. In the longer term, the massive change surrounding us means we need to keep learning and adapting.

As CPAs, we need to keep learning new skills and focus on things computers can’t do.

 

1/30/17 – Bill Sheridan at Business Learning Institute of MACPA – Want to beat the machines? Learn to do what they can’t do – Here is a way to think about automation that you might be able to wrap your brain around – How will you adapt then 30% of the work you do is automated, done faster, quicker, cheaper, and more accurately than you can do? Not 99% of what you do, not 10%, but 30%?

I can’t get my arms around audit or tax or consulting completely going away. I just can’t picture that. However, I can imagine 30% or 40% of my work as an auditor becoming completely automated. Actually, I sort of like that idea.

Computers don’t do well at applying professional judgment, courage, empathy, flexibility, and reacting to body language.

Point of article is learn to do those things better.

1/31/17 – Bill Sheridan at Business Learning Institute of MACPA – Change is a choice. So are relevance … and your future – Each of us has a choice. We can keep doing what we are doing. Or we can decide to change and grow and learn new things.

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Written by Jim Ulvog

March 14, 2017, 7:27 am at 7:27 am

Posted in Accounting, Audits, Pondering

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Updates for CPAs: going concern and location of debt issue costs

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Image courtesy of DollarPhotoClub before they merged into Adobe Stock.

Image courtesy of DollarPhotoClub before they merged into Adobe Stock.

The accelerating pace of change doesn’t slow down merely because I have multiple audits in progress plus more that just started. Here are a few articles to help keep all of us up to date on two newly effective standards:

Going concern

For a long time the professional requirements for addressing going concern issues have been located in the audit literature. Yeah, the accounting requirement was in the audit standards.  There has been an effort for several years to this guidance out of the SASs and into GAAP. Two articles show the substantial progress:

11/8/16 – Charles Hall at CPA-Scribo – It’s Time to Apply FASB’s New Going Concern Standard –  ASU 2014-15 creates a requirement in GAAP for management to assess whether there are conditions or events which raise substantial doubt about ability to continue as going concern.

This is effective for financial statements ending on or after December 15, 2016. Translation: 12/31/16 financial statements. That would be the ones you’re auditing or reviewing or compiling at the moment.

If you haven’t tuned into this new requirement, check out Mr. Hall’s article before you download the ASU for study. Hint: the new requirements on management will seem remarkably familiar.

In case you hadn’t thought about it, having a GAAP-based going concern requirement placed on management means that there is now a specific need to address going concern in a review or comp.

2/22/17 – Accounting Today – AICPA changes going concern audit standard – Now that the going concern requirements are in GAAP, the ASB has modified the rules in the audit literature.

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Written by Jim Ulvog

February 23, 2017, 9:14 am at 9:14 am

Fun reading for accountants

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Manual accounting records. Anyone miss those? Didn't think sol. Image courtesy of Adobe Stock.

Manual accounting records. Anyone miss those? Didn’t think so. Image courtesy of Adobe Stock.

A few fun reads for accountants:

  • Why no Hollywood movie will ever show a profit.
  • Adrienne Gonzalez is back at Going Concern, talking about the idea of TBTF Big 4 firms possibly, maybe, becoming SIFI (not likely to ever happen, but a fun read anyway).
  • Talent shortage appearing in the CPA world.
  • Research from Management of an Accounting Practice now available.

9/14/11 (yes, 2011) – The Atlantic – How Hollywood Accounting Can Make a $450 Million Movie “Unprofitable” – If you have never taken a look at the astoundingly creative accounting in Hollywood, this article will give you a superb introduction.

Several years ago I took a fraud education CPE course in which the instructor went on a tangent to explain why no Hollywood movie has ever made a profit and none of them ever will.

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Written by Jim Ulvog

January 23, 2017, 8:31 am at 8:31 am

Posted in Accounting, Other stuff

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A few highlights from 2017 Audit Risk Alert

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Image is from AICPA. Used under Fair Use since, after all, I am promoting three of their products.

Image is from AICPA. Used under Fair Use since, after all, I am promoting their product.

The AICPA’s annual audit risk alert had been out a little while. There is a lot of good stuff covered that all auditors really ought to check out. I heartily recommend reading the annual update before you get very far into your 12/31 audits.  The document is Audit Risk Alert General Accounting and Auditing Developments—2016/17.

I will mention just a few highlights.

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Written by Jim Ulvog

January 19, 2017, 7:36 am at 7:36 am

Posted in Accounting, Audits

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2017 Risk Alerts available

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Image is from AICPA. Used under Fair Use since, after all, I am promoting three of their products.

Image of Audit Risk Alert is from AICPA. Used under Fair Use since, after all, I am promoting three of their products.

The 2017 audit season is about to begin. Planning is well underway for all those 12/31 clients.

To help you get ready, the annual updates to AICPA risk alerts are available. Consider:

I read the risk alerts every year. They are great for reminding me of what I already knew and even better for pointing out what tidbits I had missed.

You might want to check them out in the lull before the rush of field work hits.

Written by Jim Ulvog

December 19, 2016, 7:18 am at 7:18 am

What to do about the new overtime rules since they are on hold?

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Image courtesy of Adobe Stock.

Image courtesy of Adobe Stock.

The new overtime rules were set to go into effect tomorrow, December 1. The rules are on hold as a result of an injunction issued by a federal judge. What should charities do about changes that have been implemented, or announced, or on the drawing board?

(Cross-post from my other blog, Nonprofit Update.)

Two articles have some suggestions:

11/29 – Baltimore Business Journal – Plenty of questions still surround blocked overtime pay law – It is very uncertain how the new overtime rules will be handled. Article cites the CEO of an outsourcing and payroll company. His advice is stay tuned to developments. The rules could be implemented, overturned, or modified.

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Written by Jim Ulvog

December 1, 2016, 8:27 am at 8:27 am

Posted in Accounting, Other stuff