CPAs Calculating the Latest in Audit + Accounting News

Accounting for payments and discounts to customers

Many companies sell to large, national retailers. Often, when selling to these retailers, these companies will need to make separate payments to these customers or have amounts deducted from the payments received on their invoices. However, many times we don’t see these accounted for appropriately. How should these be accounted for? It depends on the …

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A sigh of relief: accounting changes for leases

On July 17th, 2019, the FASB voted to give privately held companies until 2021 to follow the new lease standard, rather than having to implement it next year. Private companies can all let out a sigh of relief. The reasoning behind this decision comes down to the fact that changing from the old standard to …

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The auditor’s role in detecting fraud

“How did the auditors not catch this? Isn’t it the auditor’s job to detect fraud?” It is a common misconception that fraud is detected by external auditors. According to the Association of Certified Fraud Examiner’s 2018 Report to the Nations, tips are the most common detection method, at 40%, for occupational fraud while external audit …

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Revenue recognition for contractors: uninstalled materials

The new revenue recognition has been discussed extensively for the past few years and while most discussions focus on the technical issues, I like to discuss application of the standard, particularly on how it affects the construction industry. On a previous blog, I discussed contract fulfillment costs and how these costs are treated under the …

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Accounting for goodwill after acquisition

Over the years, the subsequent accounting for goodwill has been an area that has seen a lot of changes and our blog has tried to keep you up to date with all of these. Where do we stand now? First off, goodwill mainly arises from a business combination where the purchase price exceeds the fair …

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Expanded consolidation relief for private companies

Back in 2014, FASB initially provided variable interest entity (VIE) consolidation relief to certain common control leasing arrangements. While this was great as common control leasing arrangements were probably the most frequent occurrence that led to consolidation of a VIE, there has always been hope that this alternative would be expanded to all common control …

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IT safeguards, are you protecting your business?

Generally, when executives are discussing the company’s internal safeguards, they look to controls within the accounting department such as segregation of duties, dual check signors and purchase order matching. But what about safeguards within the information technology environment? As the role of IT continues to grow in the business world, your company should continue to …

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Revenue recognition: contract fulfillment costs

The new revenue recognition standard has been discussed extensively for the past few years and while most discussions focus on the technical issues, I like to discuss application of the standard, particularly on how it affects the construction industry. In a previous blog, I discussed the importance of adopting the new standard and how it …

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Evaluating a business as a going concern

During an audit, one thing that will be evaluated is your company’s ability to continue as a going concern. In layman’s terms, this means: will your company be able to stay in business in the near future? Making this determination is oftentimes not black and white, and there are several factors that both management and …

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Unclaimed property: a whole lot of money and no place to call home

What would you do with $1 billion? This astounding 10-digit figure is the approximate value of unclaimed property held by the State of Arizona and belongs to roughly one million current or former Arizona residents. Chances are one in seven of finding unclaimed property if you live in the Grand Canyon State! So, what exactly …

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