COFAR Uniform Guidance Implementation Webcast – October 2, 2014

The AICPA Governmental Audit Quality Center announced the following:

The Council on Financial Assistance Reform (COFAR) has just announced it will be presenting a Web event titled, Uniform Guidance Implementation:  A Conversation Presented by the Council on Financial Assistance Reform, this Thursday, October 2, 2014, from 1:00 PM – 3:00 PM (Eastern Time).  The event will include moderated sessions with relevant stakeholders covering various aspects of 2 C.F.R 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance for Federal Awards), including internal control; blended funding; procurement; pass-through entities and indirect cost rates; and Indian tribe exceptions.

You do not need to register in advance for this event.  Instead, use the following link on the day and time of the event to access it.

I just received word that the access link for tomorrow’s COFAR Web event has been changed to the following:

http://connectlive.com/events/uniformguidance/.

The following is from me (Charles Hall):

Think of the Uniform Guidance as a consolidation of key federal guidelines (e.g., A-87, A-122, A-133); the old circulars are being replaced by the new guidance.

Keep in mind that the effective date for the Uniform Guidance is December 2014–we are almost there. Entities receiving new federal funds–and thus subject to the cost principles, etc. in the new guidance–should be planning for implementation now. Auditors will, for the most part, be impacted by the changes in their calendar-year 2015 audits–the Uniform Guidance will replace A-133.

New Three Page IRS Tax Exempt Application

The IRS has issued a new three page tax exempt application (form 1023-EZ) for 501(c)(3) status. The existing long form 1023 is twenty-six pages. The organization must have receipts equal to or less than $50,000 and assets of $250,000 or less to be eligible. The IRS is saying that as many as 70% of all applicants will qualify for use of the shorter form. The EZ form must be filed online and there is a $400 fee. The IRS instructions are here.

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Accounting and Review Services Committee Meeting August 19-21, 2014

Could new compilation standards be on the horizon? I think yes–and very soon.

You will recall from my previous blog post, these changes will be significant.

The AICPA Accounting and Review Services Committee (ARSC) met May 20-22, 2014 to discuss the following exposure drafts:

  • Preparation of Financial Statements
  • Compilation Engagements
  • Association with Financial Statements

ARSC received and reviewed feedback from the exposure drafts in the May 2014 meetings.

ARSC is scheduled to meet again August 19-21, 2014. I have the agenda for that meeting and it appears ARSC is still pursuing the issuance of these standards. Given the changes made to the independence standards by the Professional Ethics Executive  Committee (PEEC), I expect to see these ARSC standards issued soon. The PEEC changes are effective for years beginning on or after December 15, 2014.

Three New GASB Exposure Drafts

GASB is continuing its pursuit of placing all governmental debt on the statement of net position. With GASB 68 (Accounting and Financial Reporting for Pensions), governments will include unfunded pension debt on their balance sheets and, later, once the other postemployment benefit plan (OPEB) standards are reviewed and passed, you will likewise–it appears–place unfunded OPEB debt on the balance sheet. But the OPEB decisions are, at present, in the exposure stage.

In late May, GASB issued three exposure drafts (comment deadline for all three is August 29, 2014):

  1. Financial Reporting of Postemployment Benefit Plans Other Than Pension Plans
  2. Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions
  3. Accounting and Financial Reporting for Pensions and Financial Reporting for Pension Plans That Are Not Administered through Trusts That Meet Specified Criteria, and Amendments to Certain Provisions of GASB Statements 67 and 68.

1. above applies to OPEB plans themselves.

2. above applies to employers who offer OPEB plans.

3. above addresses pension plans not administered through trusts (most pension plans are administered through trusts).

 

2014 Compliance Supplement Issued

On May 19, 2014, the Office of Management (OMB) released the 2014 OMB Circular A-133 Compliance Supplement

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The Supplement is effective for audits of fiscal years beginning after June 30, 2013, and it supersedes the 2013 Supplement. 

For a list of changes to the supplement, click here.

AICPA Standards Tracker

Do you ever wonder if new standards have been issued that you are unaware of? With standards being issued by so many different bodies, how can you be sure you are keeping up with all of them?

Good news! The AICPA provides a standards tracker and it’s free to AICPA members. The Tracker is available on the AICPA website and gives you quick references to recently issued standards, complete with effective dates, summaries, and links to the standards themselves. Click here to see the Tracker (you will need to enter your AICPA user name and password).

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This is a nice service that makes our lives a little simpler. Not all professional standards (e.g., GASB standards) are included, but, still, it will be of benefit to most CPAs.

If you are looking for a more comprehensive tracker, consider the Thomson Reuters product: Standards Tracker. Their website states: “Standards Tracker streamlines research time by enabling you to quickly organize standard-setting activity and guidance issued by the SEC, FASB, AICPA, COSO, PCAOB, GASB, and IASB into one chart.” I have used this product for several months and have found it useful.

Revenue Recognition Standard Issued by FASB and IASB

The following are excerpts from FASB’s website:

Norwalk, CT, May 28, 2014—The International Accounting Standards Board (IASB), responsible for International Financial Reporting Standards (IFRS), and the Financial Accounting Standards Board (FASB), responsible for U.S. Generally Accepted Accounting Principles (U.S. GAAP), today issued jointly a converged standard on the recognition of revenue from contracts with customers. 

The core principle of the new standard is for companies to recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration (that is, payment) to which the company expects to be entitled in exchange for those goods or services.

To watch a short FASB video about the new revenue recognition standard, click here.

New AICPA Code of Professional Conduct Now Available Online

The AICPA Professional Ethics Executive Committee adopted a revised Code of Professional Conduct that is effective December 15, 2014. The Conceptual Framework for Members in Business and the Conceptual Framework for Members in Public Practice are effective December 15, 2015. The revised Code and conceptual frameworks may be implemented early.

The online version of the new Code is available by clicking here. The online version is searchable and free.

You can also download the new Code in a PDF format; after you click my download link, see PDF option (a screenshot example follows).

download to PDF

The Code is organized in the following manner:

  1. Members in Public Practice
  2. Members in Business
  3. Other Members

 

Amazon Special – The Little Book of Local Government Fraud Prevention

You will find my book–The Little Book of Local Government Fraud Prevention–on Amazon for $2.99 (normally $9.99) during May 17-19.

The internal control checklists alone are worth the price. I provide an internal controls checklist for governments with just one or two accounting employees and then another one for larger sized governments.

The book provides plenty of information about auditing for fraud in governments, including several stories of actual frauds and how to prevent those from occurring.

The book is available only as a Kindle download, but you can place the Kindle software on any computer.