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Wednesday, 12 February 2020

Careful tax planning required for incentive stock options

Written by Thomson Reuters

Incentive stock options (ISOs) are a popular form of compensation for executives and other key employees. They allow you to buy company stock in the future at a fixed price equal to or greater than the stock’s fair market value on the ISO grant date. If the stock appreciates, you can buy shares at a price below what they’re then trading for. But careful tax planning is required because of the complex rules that apply...

Published in Tax
Wednesday, 12 February 2020

Accounting for the near and the long term in a family budget

Written by Thomson Reuters

A wise person once said, “Simplicity is the key to a family budget.” (He or she may or may not have been an accountant.) However, it also needs to be comprehensive enough to cover all necessary items. To find the right balance, a budget should cover two distinct facets of family members’ lives: the near term and the long term...

Published in Tax
Tuesday, 11 February 2020

SEC Bulletin Offers CECL Guidance

Written by The Rehmann Team

The SEC recently published Staff Accounting Bulletin 119 to provide guidance for CECL documentation expectations. Although the FASB delayed the CECL effective date for smaller reporting companies, private companies and not-for-profit entities to fiscal years beginning after December 15, 2022, planning ahead will be key to compliance.   Below are highlights from the Bulletin:   Q: What are some of the factors to consider when developing or performing an assessment of methodology for determining allowance for credit losses under GAAP?   A: Assessments of internal and third party methodologies should:   Incorporate management’s current judgments about credit losses expected from the existing loan portfolio, including reasonable and supportable forecasts about changes in credit quality on a disciplined and consistently-applied basis Take into account the organization’s size, structure, access to information, business environment and strategy, management’s risk assessment, complexity of the loan portfolio, loan administration procedures and management information systems   Q: What internal accounting controls should be addressed in written policies and procedures?..

Tuesday, 11 February 2020

2019 Bank M&A Activity

Written by The Rehmann Team

Bank stocks came under pressure in mid-2019, erasing many of the gains from the first half of the year. The Fed responded to recession fears by cutting interest rates. Bank stocks enjoyed a rally in late 2019, jumping close to 30%, and the potential for long-term rate increases going forward may lift these stocks in 2020 as well.  Anton Schutz, a senior portfolio manager at Mendon Capital Advisors, believes there is investor support for smartly priced bank M&A transactions...

Tuesday, 11 February 2020

Is the FASB New Lease Accounting Standard Impacting Banks?

Written by The Rehmann Team

In February 2016, the Financial Accounting Standards Board (FASB) issued new lease accounting standards that moves most operating and capital leases (now called finance leases) onto a company’s balance sheet. Operating leases with terms under one year are exempt.  Under the previous standard, capital leases, which transfer ownership of assets to the lessee, are reported on the balance sheet, including a liability reflecting the obligation to make lease payments, and an asset reflecting the legal right to use (ROU asset) the leased property.  Both are based on the present value of minimum payments under the lease, with adjustments to the ROU asset for certain prepayments, incentives and costs...

Tuesday, 11 February 2020

How Are “Pays” Doing?

Written by The Rehmann Team

Payment systems professionals at banks keeping a watchful eye on mobile pay and digital wallet apps - the “Pays” such as ApplePay, SamsungPay and GooglePay - as well as competition from other alternative payment options, such as the Apple Card, the Google checking account and Facebook’s Libra cryptocurrency that will be held in a digital wallet called Calibra. Mercator Advisory Group’s most recent consumer survey report, Mobile Payments: Making a Comeback, reports that U.S. consumer use of digital wallets, including universal and retailer-specific options, has been uneven but trending upward...

Tuesday, 28 January 2020

PCAOB sheds light on CAMs

Written by Thomson Reuters

In fiscal year 2019, auditors of large public companies began to include so-called “critical audit matters” (CAMs) in their audit reports. Here are initial observations from the Public Company Accounting Oversight Board (PCAOB) about the effort that large audit firms have put into implementing the guidance for the first time.  Refresher on CAMs Auditing Standard (AS) 3101, The Auditor’s Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion, represents a major change to the brief pass-fail auditor reports that have been in place for decades. The updated guidance requires auditors to add a discussion of CAMs to the audit report...

Published in Audit & Assurance
Tuesday, 28 January 2020

AUP engagements: No written assertion, no problem

Written by Thomson Reuters

The AICPA’s Auditing Standards Board (ASB) issued a revised attestation standard in December 2019. It will give accountants more flexibility when performing agreed-upon procedures (AUP) engagements. What is an AUP engagement? An AUP engagement is a type of limited assurance engagement in which a CPA performs specific procedures on a particular “subject matter” and reports the findings without providing an opinion or conclusion...

Published in Audit & Assurance
Tuesday, 28 January 2020

6 ways reporting income taxes just got easier

Written by Thomson Reuters

The Financial Accounting Standards Board (FASB) recently issued a new accounting standard that simplifies income tax accounting requirements in six unrelated areas that are costly and complex. Here are the details.  Updated guidance In December 2019, the FASB issued the changes to remove specific technical exceptions to general principles found in Accounting Standards Codification (ASC) Topic 740, Income Taxes. These items often produce information that investors have a hard time understanding...

Published in Audit & Assurance
Tuesday, 28 January 2020

Relief for Nonprofits: Congress Repeals "Parking Tax"

Written by Jeff Hert, CPA

On December 20, 2019, H.R. 1865, “Further Consolidated Appropriations Act, 2020,” (the Act) was signed into law by President Trump. The Act retroactively amends Internal Revenue Code (IRC) Section 512(a) by striking paragraph (7) which required nonprofit organizations to include expenses paid or accrued related to leased, third-party, or self-owned employee parking facilities, bicycle reimbursements, or commuter transportation as unrelated business income and pay 21 percent unrelated business income tax (UBIT)...

Published in Not-for-Profit
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