Tips for Good Governance of a Not-for-Profit Organization

I was recently reading an article in the September issue of the Journal of Accountancy that highlighted tips for good not-for-profit governance that were presented at this year’s AICPA Not-for-profit Industry Conference.  It was such a concise, solid list that I thought I’d share it with our blog readers: 1. State the organization’s values in a …

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The Fraud Triangle – 40 years later

In 1973, Donald Cressey published the results of his research on embezzlement in Other People’s Money: A Study in the Social Psychology of Embezzlement.  Mr. Cressey’s hypothesis has become known to many as the “fraud triangle.”  The factors identified 40 years ago as an explanation of why someone would commit embezzlement are still relevant today …

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The Evolving Affordable Care Act – Health Insurance

Yesterday morning, President Obama announced that 2014 sales of previously-canceled individual health plans that don’t meet ACA standards would be allowed to be issues and stay in force for another year. The change will offer a temporary “fix” to the millions of consumers whose policies have been canceled or altered as a result of healthcare reform. …

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Foreign Tax Credit – Individuals

If your investment portfolio includes holdings outside of the U.S., it is not uncommon to see foreign taxes withheld on the foreign sourced income it generates.  Generally, you may claim a credit for foreign taxes if the following four tests have been met: 1. The tax must be imposed on you 2. You must have paid or …

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10 Things to Know When You Have a PAC (Political Organization)

Here are ten important things to know when you have a political organization (PAC): (1) The IRS requires that a PAC have its own taxpayer ID # which can easily be obtained at the IRS website by completing form SS-4. (2) When a political organization is first formed, it must give notice electronically to the IRS that …

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IRS Matching – Better Success than Online Dating?

No IRS has not gotten into the online dating biz.  While I’m sure they tax it, matching couples is a bit beyond their scope. But IRS does share a very distinctive characteristic with online dating.  Try as they might, they don’t always get it right when it comes to making a good “match”. As many …

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Testifying awareness – why CPA experts should be careful of what they write

CPAs who have been retained as testifying expert witnesses often prepare a written report, sometimes with accompanying exhibits, in support of their opinions to be expressed in the courtroom.  Experienced CPAs who do this sort of thing typically include a statement of their qualifications as a part of their reports.  This statement of qualifications, or …

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Allocating Expenses – Make the Process Easier

Expenses are reported in two different ways on the 990 return: by their natural classification (salaries, depreciation, travel, etc.) and by their functional classification (program, administrative, fundraising).  Correct functional allocation of expenses is important because some donors may scrutinize the percentage of program costs vs. administrative and fundraising costs while making a decision to donate …

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Abandonment May Be A Good Thing – Get Rid of Capital Call Payments

Tired of making those capital call payments on an investment partnership that may never recover its value? Consider abandoning it. If the value is depressed and recovery is nowhere in sight, why continue to throw money at it. By abandoning the investment, not only do you get the tax loss now, but it may be …

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