New Repairs & Maintenance Regulations May Require a Change in Accounting Method
Last month, we advised you about a seismic change in the IRS position regarding how repairs and maintenance expenses are to be handled for tax purposes. What signaled this shift in the IRS position was a directive issued to its agents in the field to “stand down” on all examinations in progress where the treatment of repairs and maintenance expenses was an issue. Agents were further instructed not to begin new activity in this area for any year beginning before January 1, 2012. The IRS also advised agents to ensure that, going forward, taxpayers either have implemented or will shortly implement the changes. Read More.
New JOBS Act Lowers Barriers to Business Investment
Earlier this month, President Obama signed into law the Jumpstart Our Business Startups Act (“JOBS Act”), which includes a number of provisions aimed at easing access to capital for entrepreneurs with the goal of ultimately creating new jobs. Crowdfunding from Non-Accredited Investors The JOBS Act eases restrictions on equity-based crowdfunding to now allow investments by all investors, not just accredited investors. Any non-credited investor can invest up to the lesser of 10 percent of annual income or $10,000. Crowdfunding investments will still need to file with the Securities and Exchange Commission (SEC), and are restricted to raising $1 million annually,. Read More.
FASB Decides Against Extensive FIN 48 Overhaul Project
The Financial Accounting Standards Board (FASB) announced yesterday a decision against initiating an extensive project to overhaul of FASB Interpretation No. 48, or FIN 48 , “Accounting for Uncertainty in Income Taxes.” As reported in Accounting Today : The report found that the 2006 standard generally meets its goal of increasing the relevance and comparability in reporting information about income tax uncertainties. But the report, which was compiled by an independent committee appointed by the FAF board of trustees, also found from interviews with various stakeholders that consistently applying FIN 48’s guidance may not increase the comparability of information about income tax uncertainties across. Read More.
Replacing SAS 70 with SSAE 16 — A Brief Overview
Who Does What User organization – The entity that has engaged a service organization to perform various services for them. For example a company’s employee benefit plan record keeping. Service organization – The entity that provides services to a user organization. Staying with the benefit plan example, a bank trustee, insurance company or benefits administrator, among others. User organization auditor – The auditor (i.e., CPA firm) that conducts the financial statement audit on the user organization. Service organization auditor – The auditor (i.e., CPA firm) that conducts the controls audit at the service organization. The AICPA’s new service organization reporting standard, Statement. Read More.
Private Companies May Soon Get Their Own GAAP
For years, government, public and private parties have discussed creating a separate private company accounting standards. Now standard-setters may actually do something about it. The Financial Accounting Foundation (FAF) — parent organization to the Financial Accounting Standards Board (FASB) — will soon decide whether to adopt recommendations made earlier this year by a blue-ribbon panel on standard setting for private companies. The panel recommended that the FAF establish a separate, private company standards board to develop appropriate changes to U.S. Generally Accepted Accounting Principles (GAAP) that would “better respond to the needs of the private company sector.” The new board. Read More.
Proposed Standard Will Bring Changes in Revenue Recognition
In 2002, the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) agreed to work together to converge U.S. generally accepted accounting principles (GAAP) and International Financial Reporting Standards (IFRS). Revenue recognition is one of the most important projects on which these two bodies have worked together, and this work recently produced a new proposed standard. This new standard is expected to be released sometime in 2011 with an effective date still unknown. This new standard will replace most pre-existing general and industry-specific guidance and create a single revenue recognition standard for both U.S. GAAP and IFRS.. Read More.