Reviewing 401k Loan Requests for Compliance

During audits of 401(k) plans, one of the most common internal control deficiencies we communicate to management is when the plan sponsor relies on a third party administrator to make sure that loan requests are in compliance with federal regulations and the plan document.  The plan sponsor always maintains fiduciary responsibility with compliance on loans …

Keep Reading

Can I Trust My Employees?

“I’m not upset that you lied to me, I’m upset that from now on I can’t believe you” – Friedrich Nietzsche Although trust is a significant factor when maintaining good relationships with your employees, it can be misplaced or abused.   In fact, statistics reveal that acts of embezzlement and theft are frequently committed by trusted …

Keep Reading

Straight-line expense recognition of leases

Update: The guidance below will be superseded upon the new lease accounting standard becoming effective for most private companies in 2020. For further information on the upcoming changes to lease accounting, click here. Sometimes operating leases aren’t as straightforward as they seem to be and there are a couple of situations that create a deferred …

Keep Reading

What the Yellow Book Update Means for You

Some of you may have heard that the Government Accountability Office (GAO) has recently updated the Government Auditing Standards for the Yellow Book this year.  Some of you may be wondering how is this update going to affect me, or what is my auditor going to be asking for that I should be prepared for?  …

Keep Reading

The Yellow Book Update and New Independence Standards

The Government Accountability Office (GAO) has recently updated the Government Auditing Standards this year.  Some of you may wonder, “How is this update going to affect me?”  Or, “What is my auditor going to be asking that I should be prepared for?”  Among the seven chapters and over 200 pages of information that you and …

Keep Reading

Compensated Absences

“Compensated absences” refers to employee absences for which employees will be paid, including vacation and sick leave.  Expenses are normally recognized during the period for which the employee provides services qualifying that employee for compensated absences.  If the employment policy specifically dictates, a liability is accrued for unused portion of such compensated absences.  Liabilities are …

Keep Reading

Governmental Accounting Standards Board’s (GASB) Addition to the Financial Statement Elements and Implementation of GASB 65

GASB has added two elements to the original five financial statement elements.  GASB Statement No. 65 Items Previously Reported as Assets and Liabilities, issue guidance on using the new elements.  The two new elements are Deferred Outflows of Resources and Deferred Inflow of Resources.  GASB’s seven financial statement elements are defined as follows: Assets- resources …

Keep Reading