Does your company have a capitalization policy?

When undergoing an audit, one question the auditors may ask is “does the company have a fixed asset capitalization policy?” While having a written capitalization policy in place will make your auditor happy, it will also help simplify the accounting for fixed asset purchases. Establishing a capitalization policy helps keep the treatment of property additions, …

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When Do You Capitalize Interest?

Under the accrual basis of accounting, interest is capitalized in association with the financing of assets an organization constructs for internal use or for assets that are constructed with the intent to sell or lease upon completion. Interest is only capitalized during the period under which the asset is being prepared for its intended use. …

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Changes to Requirements for Reporting Discontinued Operations

In April 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-08 Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity that changed the requirements for reporting discontinued operations. Under the new standards, a disposal of …

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How to Implement “Step 0” of the New Goodwill Impairment Testing Standards

The Financial Accounting Standards Board (FASB) issued new guidance that is aimed to make goodwill impairment testing easier for companies, and this guidance is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. How will the new standard impact my company?  The new standard modifies the previous …

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Arizona’s Requirements for Reporting Unclaimed Property

It is common as an accountant to see a business void an un-cashed check after a while or to write off an over-payment from a customer who hasn’t returned in a couple years.  It seems that few people know that it is required by Arizona law to report and remit unclaimed property to the Arizona …

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Stock Compensation: Stock Options

Stock compensation to employees and other suppliers of goods or services can take many forms, including the stock option grants, awards of restricted  and non-restricted stock, cash payments based upon the company’s share price, and employee stock ownership plans, amongst many others.  The one common attribute of the many varying forms of stock compensation is …

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Business Combinations 101

Over the past year, there seems to be some increase in activity related to mergers and acquisitions (“M&A”).  When times are tough you typically see an increase in M&A activity as strong companies will act to buy other companies to create a more competitive, cost-efficient company.  M&A’s can come in various forms.  They can be …

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Employee Vs. Independent Contractor

If you are a business owner and your business is growing you may be looking into hiring additional help.  The question then may be whether you should hire this person as an employee or as an independent contractor. Like most business owners, you will probably start by weighing those costs associated with each classification.  Hiring …

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