AZ
CPA DECEMber 2012
The Arizona Society of Certified Public Accountants
Industry FOCUS • Bank Supervision • Lobbying and Lobbyists • Self-Insured Health Care Plans • Demystifying Self-Directed IRAs • Building Value into Your Firm www.ascpa.com
the difference is
Delivering Solutions Introducing Eide Bailly’s Newest Phoenix Partners: Norman Mendoza, Gary Smith, Brenda Blunt and Sean Hales At Eide Bailly, growth is intentional. We take pride in growing our Firm by embracing the ideals of our culture and welcoming people who believe that making a difference is what matters. Every day. We bring not only accounting expertise, but in-depth industry knowledge and specialized services to the organizations who trust us as advisors. As members of our local communities, we’re here to serve and deliver solutions that drive success.
Experience the Eide Bailly Difference Call today to learn more! 602.264.5844 | www. e i d e b a i lly. c o m
2 AZ CPA y DECEMBER 2012
Left to right seated: Andy Spillum, LeAnn Rudolph, Sean Hales, Brenda Blunt Left to right standing: Joshua Hayes, Rob Leslie, Victor Puchi, Norman Mendoza, Gary Smith
connect
Communicate • Collaborate • Contribute The new, interactive online community only for ASCPA members Want to network with your peers? Need to find out the answer to that tricky tax question? Do you have expertise and information to share? Want to learn more about what YOU are interested in? Then Connect is the right place for you. The Arizona Society of CPAs recently developed an online network for members only that will allow you to interact and communicate with your peers. This tool puts the most relevant information at your fingertips.
Your Checklist to Get Connected
3Import Your LinkedIn profile with a click of a button. 3
Add a picture to your profile – If you imported your LinkedIn profile, this is already done.
3
Set your privacy settings so members can easily find and connect with you through the member directory.
3
Find and connect with members – Did you meet someone interesting at a CPE course? Add them to your contacts on Connect. You can use the member directory to find them.
3
Join a community that fits your interests – whether it is tax, financial planning, emerging leader.
3
Ask or answer a question – There is a main discussion forum and discussions in each of the communities – It is a great place to find new ideas and share experiences with other members.
3
Access the Library – Each community has a library of documents and articles related to the community’s field of interest. You can also add your own documents to the library.
3
Read or write a blog – Members can write their own blogs on the site and have it available for members only or open for the public to read.
Add your photo to your profile by Dec. 15 and be entered in a drawing to
Join the discussion at: http://connect.ascpa.com
win an iPad!
DECEMBER 2012 y AZ CPA
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AZ
CPA DECEMber 2012
Volume 28 Number 10
The Basics of Bank Supervision
13
Taking a closer look at the work of the Federal Reserve Bank. by Cynthia L. Course, CPA
Demystifying Self-Directed IRAs and 401(k) Plans
16
New alternatives for investing and how you can help your clients. by Richard E. Bingaman, CPA
Features Lobbying and Lobbyists— How I Changed From a Cynic to an Advocate (and why I think you might, too )
Building Value into Your Firm 9 How to overcome challenges in a sluggish economy.
ASCPA member Patricia Bambridge looks into how the ASCPA lobbies and what its lobbyist does. by Patricia Lees Bambridge, CPA, CGMA
Self-Insured Health Care—Busting the Myths
11
Find out how small- and mid-size companies can benefit from self-insured health care plans. by Rachael Piergallini, CPA
Arizona Society of Certified Public Accountants 4801 E. Washington St., Suite 225-B Phoenix, Arizona 85034-2021 www.ascpa.com
by Ron Parisi, JD
Columns & Departments 6
Chair’s Message by Armando Roman, CPA
7
Focus on Members
8
Letters - The Downside of Inactive Status
8
In the Black ... Adventures in Accounting
22 Classifieds
www.ascpa.com
4 AZ CPA y DECEMBER 2012
19
AZ
CPA
The Arizona Society of Certified Public Accountants
President & CEO
Cindie Hubiak
Editor
Patricia Gannon
Copy & Advertising Deadline The first of the month one month prior to publication date. Board of Directors Chair Chair-Elect Secretary/Treasurer Directors
Armando Roman Karen Abraham Anita Baker Rob Dubberly Debra Johnson Jimmy Lovelace CW Payne George Raysik Phil Reckers Craig Robb Andy Spillum Leslie Stackpole Elva Vivas Corrine Wilson Kevin Yeanoplos
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Immediate Past Chair Mark Anderson AICPA Council Members Jim Buhr Rick Goldenson Chapter Presidents Southern Chapter Northern Chapter Southwest Chapter North-Central Chapter
Flo Zenblu Jennifer Nordstrom Jayne Wright Richard Joliet
AZ CPA is published by the Arizona Society of Certified Public
Accountants (ASCPA) to provide information, news and trends in the profession of accounting. It is distributed 10 times a year as a regular service to members of the Society. The ASCPA, its members, board of directors and administrative staff assume no responsibility for advertisements herein. The ASCPA and the above people also assume no liability for business decisions made by readers in reference to statements and/or claims in advertisements within this publication. Opinions expressed by correspondents and contributors are not necessarily those of the ASCPA.
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Arizona Society of CPAs 4801 E. Washington St., Suite 225-B Phoenix, AZ 85034-2021
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DECEMBER 2012 y AZ CPA
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Chair’s Message
by Armando G. Roman, CPA
Counting on Credentials Roughly half our members are in public accounting, while the other half are in literally everything else. Portable skills and adaptability ensure continuity of our profession as we specialize and evolve. At the AICPA Fall Council 2012 meeting, discussion included the topic of specialty credentials conferred by the AICPA. You’ve seen them: ABV, CFF, CITP, PFS. As a member in the everything else category and a specialty credential holder, I can speak to the resulting value I get by having this additional credential. Holding the PFS provides access to the many, many tools I rely on, tools I use every week in my practice. Every PFS holder has access to this “members only” section of the AICPA website, although my guess is many members do not know it exists. I did not know this until speaking with AICPA staff at a conference in Las Vegas where they explained in depth the various white papers that members rave about. I’m now a raver, too. Let me explain why. In the wealth management world, lots of information exists spewing from all directions from self-proclaimed “experts,” many of whom have unproven track records. With so much information, it takes a lot of time to decipher and wade through it all. Think of the recent presidential elections where both candidates made statistical claims on the same topics (jobs, domestic oil production) each concluding opposing results. Fact checkers subsequently validated or invalidated their claims, sometimes concluding that both candidates were correct depending on how and when results were measured. When two presidential candidates publicly call each other out and do everything but call each other a liar basing their claims on “facts,” you begin to wonder what facts you can rely on. As such, my task becomes one of filtering past the glossy sales information to get the real information, the relevant information. That’s where the AICPA helps me. The AICPA provides unbiased, accurate information to PFS holders in the members-only section. Maybe other credential holders have similar access to relevant information. The broad-based AICPA Fall Council discussion on specialty credentials was interesting. There was a concern that adding specialty credentials could weaken the core credential that we all hold, the CPA license. The concern unfolded this way: if we continue to add more and more specialties, then what’s left? The CPA generalist? And how valuable is a CPA generalist anyway? Studies have shown that as a profession the public trusts us more than any other profession with the
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exception of physicians. The public also associates “C-P-A” with “T-A-X,” an association that tax practitioners may appreciate while the rest of us politely explain our way out of those unwanted tax conversations. The AICPA continues exploring the merits of additional specialty credentials. Additional highlights of the Fall Council meeting included enticing handouts most notably The Future CPA’s Guide to Work and World Domination, an AICPA publication. If you have youngsters at home, as I do, you may want to contact the AICPA for a copy of this postcard-size book. I have yet to test it on my teenage sons, although I expect my sons will see humor in it and will use it as yet another opportunity to poke fun at Dad. It’s usually about this time when I remind them Dad still has the ability to say “No” to their teenage requests. (Being Dad is great.) Another Fall Council take away, The Futurizer, is a glossy card stock wheel. You turn the top circle, to identify one of 14 accounting career choices, let’s say Global Controller for Hershey’s. Cut outs on the top circle reveal text on the bottom circle. The Global Controller for Hershey’s selection reveals three text boxes, one of which is the salary range for this type of career choice. Visually, the wheel belongs in a board game. It’s quite appealing. AICPA’s Start Here magazine rounded out the suite of accounting books designed to attract newbies into accounting career tracks. So whether you’re in public accounting or with the other “half,” the CPA profession continues to be viable and provides AZ CPA a host of interesting career opportunities for all.
Focus on Members Julie Klewer, CPA, has joined the Arizona CPA Foundation for Education & Innovation board. The Foundation would also like to recognize Gary Gethmann, CPA, for his board service from 2007-2012. The Phoenix office of Grant Thornton LLP has appointed J. Dee Itri, CPA, to manager in the National Tax Strategic Solutions group. Linnette Klinedinst, CPA, has been appointed to manager in the Audit Services Practice. Congratulations to Lisa Gene Johnston, CPA, of Custom Accounting & Tax PC, and Katie Marion, CPA, of Cox Communications, who recently participated in the AICPA’s Leadership Academy in Durham, N.C. Raelynn Mackenzie, CPA, has been appointed to the AICPA Joint Trial Board. And Armando G. Roman, CPA, has been appointed to the National CPA Financial Literacy Commission of the AICPA. Roman is also currently chair of the ASCPA. The Phoenix office of CBIZ MHM, LLC has had an award winning year. Awards included: the 2012 Alfred P. Sloan Award Honorable Mention, which focuses on excellence in workplace effectiveness and flexibility; and the 2012 Most Admired Companies award given annually to 40 Arizona businesses and focuses on areas of leadership excellence, social responsibility, customer opinion and workplace culture. Most recently they received the 2012 Best Places to Work in the Valley award.
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Dr. Bill Huizingh, ASCPA life member, helped create the Arizona Office of the Auditor General in 1969. He shared stories with Debbie Davenport (right), current Auditor General, including why the AG is required to be a CPA. Debbie is only the third Auditor General in more than 40 years. Cindie Hubiak, ASCPA President & CPA, joined them, enjoying the history lesson.
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Letters The Downside of Inactive Status For the last 100 years there have been two classes of accountants in Arizona. The “Certified” (Licensed) and the non-certified accountant. Anyone who wants to use the title CPA, is required to demonstrate the highest qualifications of education, experience and pass a rigorous exam, to be awarded the designation. (ARS Section 32-747). The uncertified accountant is permitted to render accounting services as public demand requires. This is usually in the area of bookkeeping and tax return preparation. These accountants can operate independently or work in private industry or in government. Currently, a CPA who desires to place his certificate on “Inactive Status” is permitted to do so pursuing to ARS Section 32-730(B) (E) and rule R4-1-345. The benefit is avoiding having to take four years of CPE, assuming that the CPA intends to re-activate his or her license prior the expiration of six years on inactive status and the resultant license revocation. This statutory permission to avoid CPE is useful for the CPA seeking additional education, going on extended sabbatical, vacation or temporarily changing careers. There is a significant statutory downside, however, to being
on inactive status. The Board of Accountancy emphasizes this restriction in its written forms and correspondence. During the time the CPA is inactive he cannot practice or preform any accounting services for compensation. The CPA clearly has surrendered his or her right to use the protected term CPA during this time, but also cannot practice any accounting for compensation as an individual or employee. He cannot do what the non-certified accountant can do! Has the state created a third class of accountant who has the superior education and experience, but cannot function as the unlicensed accountant may? Does this restriction serve a public interest? Is it necessary for public safety? The legislature apparently said it does. Is this disenfranchisement necessary? Remember that the Board retains jurisdiction over the inactive CPA, to authorizing it, at any time, to address performance issues with the CPA. (ARS Section 32-701 (2). Therefore, elect inactive status carefully, knowing that if your plans change, you cannot return to gainful employment until you reactivate your certificate or surrender it so you can become employed as an unlicensed accountant. Submitted by D. Jay Ryan, JD
In the Black ... Adventures in Accounting
8 AZ CPA y DECEMBER 2012
Concept: Heidi Frei Illust.: Jack Gannon
Lobbying and Lobbyists How I Changed From a Cynic to an Advocate (and why I think you might, too)
by Patricia Lees Bambridge, CPA, CGMA
What comes to your mind first when you read the word “lobbyist” in a news article? My personal preconception surfaces each month when reading the Legislative Update in the ASCPA eNews. There is just something about that word that rubs me the wrong way. So recently, I sent an email to an ASCPA staff member sharing my lessthan-positive feedback of Washington’s seemingly large number of special interest groups, represented by lobbyists, clamoring for entitlements in the bills introduced to Congress and the legislature. Sensing that the services of our ASCPA lobbyist are much broader than lobbying in the conventional frame of reference, I suggested considering that our lobbyist be referred to as our liaison, a less derogatory term for me. The well-considered response to my suggestion clarified that lobbyist is a real title and that transparency is key. Was this just my antiquated perception that prompted me to investigate? I conducted a cross-country, cross-gender, cross-generation, and cross-profession survey with a moderately scientific approach and found a consistent reaction to the word lobbyist: “trading influence for money,” “individuals hired to help push forward agendas in government bodies and not all good,” “manipulators of legislators for special interests” and even the Hollywood image of big corporate
bucks backing a hazardous product via the services of a lobbyist. All the while, I know from my membership in the ASCPA, that there is an underlying benefit to associating with a lobbyist to protect my CPA license. So I dug further. In Arizona, ARS41-1231 defines a lobbyist as “any person who is employed by, retained by, or representing a person other than himself, with or without compensation, for the purpose of lobbying and who is listed as a lobbyist by … the person… that employs, retains, engages or uses, with or without compensation, a lobbyist.” With minor and inconsequential variances, this is the common definition. Under the First Amendment of the U.S. Constitution, lobbying is a protected activity with guaranteed rights to free speech, assembly and petition. Credentials are not a requirement in Arizona. However, if lobbying is done on behalf of a principal or public body, the lobbyist must register with the Arizona Secretary of State and to that agency, must submit quarterly expenditure reports, annual reports and other filings. In October of this year, a legislative reform package was unveiled. It is described as enhancing transparency and strengthening the public’s trust in their elected officials. Passage of this package will simplify the public’s ability to find out who is lobbying their elected representatives and on behalf of which interests. The key to this proposal will be an online interactive database on the website of the Secretary of State. According to a press release on www.azleg.gov, this proposal will “require
DECEMBER 2012 y AZ CPA
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that lobbyists and legislators use the site to independently disclose any meal, event ticket, or other event paid for by a lobbyist in the course of legislative advocacy, thus creating a checks-andbalance system that holds both parties in the transaction accountable for its disclosure. As currently envisioned, this innovative online tool will significantly enhance legislative transparency by: • Providing up-to-date tracking of lobbyist expenditures • Requiring real-time reporting by lobbyists and legislators • Making both reporting and searching easy with a simple interactive tool • Allowing the public to search for disclosures by legislator, lobbyist or client • Simplifying the reporting process for legislators and lobbyists The obvious result is that lobbyists and legislators will be held to a higher standard of accountability to the public. Perhaps their reputations will also be enhanced. With all this is mind, I wanted to learn more about the ASCPA lobbyist and how the work of a lobbyist helps me, as a CPA, so I contacted DeMenna & Associates. Who is our ASCPA lobbyist? DeMenna & Associates has been our legislative advocating team for 20 years. Kevin and Ryan DeMenna are generally regarded as being so effective, that when major projects of any kind are being pitched to lawmakers, DeMenna & Associates is usually involved in some capacity. Both gentlemen began their careers in the legislative process as staff of the Arizona State Senate. To be successful in their endeavors, they must take the time to learn the issues, to be skillful, sensitive and persuasive. More specifically, they serve as political consultants to our profession, much as management consultants and public relations serve in the non-political arena. With legislative term limits, continuity is provided by the services of DeMenna & Associates. In fact, as junior legislators enter the stage, it is not unusual
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Each year, the ASCPA works to ensure the timely passage of federal income tax conformity legislation. The goal is always to complete the Arizona changes before tax returns are due in order to avoid filing uncertainties.
for them to turn to the lobbyist as a resource. A prime example of DeMenna & Associates’ political consulting activity is their involvement with Senate Bill 1199 relating to charter schools which was signed into law March 29, 2012. Previously, charter schools were required to contract for an annual financial statement audit with a different independent CPA auditor at least once every six years. According to Ryan DeMenna’s summary of the 2012 amendment, a comprehensive strategy was developed and implemented to repeal the mandatory audit firm rotation provision. Rather than require this audit firm rotation, the problematic provisions were repealed and a task force of CPAs was formed to assist the Arizona State Board of Charter Schools and its staff review financial information. Also, a member of the ASCPA was appointed to serve as a direct conduit to the Charter Schools board of directors. This multi-faceted approach not only addressed the issues of the Charter Schools Board, but it also ensured that mandatory audit firm rotation was removed from Arizona law. This exemplifies the successful working relationship DeMenna & Associates has with the ASCPA. How does the lobbyist influence evolve seasonally? Most recently, Arizona’s Second Regular Session of the 50th Legislature convened January 9, 2012 and ended May 3, 2012, with most laws becoming
effective on August 2, 2012. During this last session there were 1,395 bills introduced plus 149 memorials and resolutions. Of the total bills introduced, 389 were submitted to the Governor. Of those, 363 bills were signed into law. Ryan DeMenna confirms this to be a typical count for a normal session. As our lobbyist, the DeMenna & Associates staff read every bill introduced and identify every item that could have an impact on Arizona’s CPAs as a profession. This approach sets in motion the strategy to advocate on behalf of all Arizona CPAs. According to Cindie Hubiak, president & CEO of the ASCPA, in addition to the normal review of all legislation that will impact CPAs, the ASCPA and its lobbyist are working with the Accountancy Board to update statutes that regulate CPAs, and to correct language related to tax and accounting matters. Each year, the ASCPA works to ensure the timely passage of federal income tax conformity legislation. The goal is always to complete the Arizona changes before tax returns are due in order to avoid filing uncertainties. In conclusion, while I could not change the term lobbyist, nor the definition of a lobbyist to something more positive to my own sensibilities, I have developed a much greater appreciation for the concept of a lobbyist. I value what our lobbyist is doing to help the ASCPA protect the integrity of our profession in both the political and the AZ CPA business sectors of Arizona. Patricia Lees Bambridge, CPA, CGMA is controller at Whitehat, Inc.
Self-Insured Health Care – Busting the Myths by Rachael Piergallini, CPA Self-Insured Health Care benefits for my company? Only big companies can do that… there is too much risk… How can I budget for it? These are some of the myths that many small and mid-size employers believe about self-insured healthcare plans. And, although the monthly expense can and does fluctuate, there is more predictability than most employers realize. And there are multiple ways that the employee can manage the plan to impact the costs. Under a self-funded plan, the employer assumes the health plan liability and risk in exchange for more control over the plan’s administration and funding. This differs from traditional fully insured plans where the insurance company assumes the risk, controls the plan administration, establishes reserve capital levels and manages other major decisions concerning the health care plan. Self-insurance offers a variety of potential advantages to employers, including: • Autonomy, control, and flexibility over the plan design, including exemption from state mandated benefit requirements; • Lower administrative services costs; • More timely and complete access to data on health claims to help make more informed decisions about the design of their health plan; • Ease of altering their contract with a third party administrator (TPA) or stoploss insurer without affecting their employees’ choice of providers; •Improved cash flow generated by keeping funds in-house until needed for payment of claims; and • Avoidance of state insurance premium taxes. Self-insurance also has potential disadvantages relative to the purchase of a fully-insured product, including: financial risk of unexpectedly large claims, and regulatory compliance, which is easier with a fully-insured plan. Self-insuring appeals to employers because dollars not spent on medical care stay in the company instead of flowing to the insurance carrier’s bottom line. The approach also gives businesses more detailed information about how their workers use health care. Claims data, which insurers are often reluctant to share, can help companies tailor plans and wellness programs to improve workers’ health. A 2012 report by Deloitte sites that in 2010, six of 10 employers who offered health insurance were self-insured. And of employers with 5,000 or more employees, 93% were self-insured. Let’s examine some of the myths: “I have no way to predict whether I will have multiple high-risk employees and my costs will ultimately be more than traditional health care premiums”
When a company elects to self-fund its health plan, it can purchase excess insurance coverage to protect itself from extreme claims. This insurance is called employer stop-loss (ESL) coverage. The limits can be set according to the cash flow needs of the company, typically ranging anywhere between $25,000 and $100,000. In addition to covering the potential losses inherent with any group benefit plan, ESL coverage provides protection for the entire covered group, reimbursement for medical expenses above a specified dollar amount, and cover for catastrophic and high dollar claims such as transplants, leukemia, renal failure and premature births. To help facilitate the process, a company may contract with a third-party administrator (TPA) for claims payout, disease and case management firms, benefit plan administration, oversight of managed care networks (e.g. PPOs) and management of service vendors such as pharmacies. In a firm with 100 employees, it is estimated that one to two of every 100 employees could be high risk. Still, the employer would want to evaluate their employee pool as the diversity and age of the pool may indicate a higher risk potential. A relatively healthy and younger employee pool is more likely to have a lower risk. The administrative costs for employers who self fund and purchase stop loss insurance are significantly lower than the internal cost of administration of a fully insured program. Insurers have much higher overhead and they must also include a “claim fluctuation charge” or “margin” with every policy. The higher overhead is due to both premium taxes and the higher expense associated with State plan requirements. “Will being able to control my benefits really make a difference?” The employer is able to manage and oversee all medical service providers used, thereby exercising more control over the type and quality of care as well as the cost of care provided. The plan can be set up so that preferred/lower cost providers are discounted to the employees, thus driving
DECEMBER 2012 y AZ CPA
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the buyer/employee behavior to these providers to keep the costs down. Co-Pay and deductible limits can be set to do the same. For example, setting the co-pay for an emergency room visit at $500 and Urgent Care visit at $100 can incentivize the employee to choose Urgent Care first, when available. Incorporating and promoting wellness programs can also increase the health of employees, resulting in less claims. And recently, some employers have begun to collect biometric information from employees (e.g., cholesterol levels, body mass index) to use as part of their wellness programs. Many firms can leverage this by providing a financial incentive to employees to encourage them to complete the assessment. Additional savings are recognized when the employees are given the option to complete this in order to avoid a financial penalty, such as a higher premium contribution or higher patient cost sharing. As in auto or life insurance, the lower premium is given to employees that manage their health and participate in the wellness programs. Why do employers have to assume the higher medical expense for employees that aren’t willing to help manage their health? “There is too much risk and no predictability for budgeting” Although the monthly amount of claims is paid according to what was actually incurred in medical expenses for the month, budgeting is still possible. The Plan Administrator can predict what the potential yearly spend will be, based on historical claims trends, and the employer can then set a reserve for the monthly estimated cost. Although the amount will fluctuate monthly, the net amount at the end of the year will typically be less overall. Understanding that the implementation of self-insured health care is a long-term strategy for total savings, and that about one in every five years will have above average claims, helps the company to stick it out in the face of the fluctuations. AZ CPA Rachael Piergallini, CPA, is controller/ director of administration at Science Care Inc. Email: rachaelpiergallini@yahoo.com.
The Basics of Bank Supervision By Cynthia L. Course, CPA In September, I had the privilege of speaking to a number of the ASCPA’s members at a Behind the Scenes event held at the Federal Reserve Bank of San Francisco’s1 Phoenix cash processing facility. During the event, I discussed the structure of the Federal Reserve System (the Fed), the reasons why the Fed and other regulators supervise and regulate banking organizations, and the different aspects of our activities that collectively comprise “banking supervision.” I’d like to share with you a sampling of the topics I covered and the questions I received during the session. The answers to these questions will provide some insight into the Fed’s banking supervision responsibilities and perhaps whet your appetite to participate in a future Behind the Scenes event at the Federal Reserve! Why do you supervise banks? Banks play a critical role in the U.S. economy. Recognizing the importance of a stable banking and payments system, our goals in banking supervision and regulation are to promote the safety and soundness of the banking system, foster stability in financial markets, ensure banks’ compliance with applicable laws and regulations, and ensure fairness in consumer financial services. We do this through a combination of on-site examinations and off-site surveillance and supervision activities.
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How often do you examine banks? The examination cycle for safety and soundness examinations and specialty examinations, including consumer compliance and Community Reinvestment Act examinations, varies with the size and condition of the company. The Fed’s examination manuals and other guidance describe the examination cycle criteria.2 For example, a smaller bank in satisfactory financial condition generally will be examined for safety and soundness every 18 months, while a larger bank, regardless of financial condition, will be subject to continuous supervision. In addition, we generally alternate examination events for smaller banks in sound financial condition with the state banking supervisor.
How do you decide what to look at when examiners go into a bank? Our examiners follow guidance outlined in our examination manuals when conducting bank examinations.3 The examination process is tailored to the risk profile of the bank and is influenced by its financial condition, size, scope of activities, and complexity. The examination culminates in a rating of the bank’s Capital Adequacy, Asset Quality, Management, Earnings, Liquidity, and Sensitivity to Market Risk (CAMELS), along with a rating for the bank’s overall condition.
Why are examination ratings confidential? A bank examination is not the same as an external audit, which is designed to provide shareholders assurance that the financial statements reflect fairly the condition of the company. The audit opinion is therefore made public as it serves a public purpose. We conduct bank examinations (and the related inspections of companies that own banks) to determine whether the institution is operating in a safe and sound manner and in compliance with laws and regulations. The audience for those reports is bank management and its board of directors, as well as other
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As a point of trivia, in 1934, deposits were insured up to $2,500! The level of insurance has steadily increased, reaching $100,000 in 1980 and rising temporarily to $250,000 during the financial crisis in 2008. financial institution regulators, and the reports and the ratings often contain frank information intended just for those audiences. In fact, the federal bank regulatory agencies have rules prohibiting the release of this information.4 That being said, there is recognition that the public should know when an institution is in such condition that a formal enforcement action is warranted. Since August 1989, the Fed has made all final enforcement orders public, and you can download the text of a formal enforcement action through a searchable database on the Fed’s public website. 5 The other banking supervision agencies have similar websites for their formal enforcement actions. Finally, banks are required to make public their Community Reinvestment Act ratings, given the explicit linkage between community reinvestment and the community. Despite not knowing a bank’s examination rating, the public can take comfort in the fact that their interests are protected through FDIC deposit insurance and that information on the institutions in the most serious financial condition is publically available.
What information do you look at during off-site monitoring? Our analysts and examiners review a variety of public and nonpublic information during off-site monitoring, which complements our on-site examination activities. In the public domain, we review documents such as regulatory and SEC financial statements filed by the bank and its parent company, annual and quarterly reports, press and news releases, and investment analysts’ reports. If the company is publicly traded, we
will also sit in on any company conference calls with analysts. Our analysts and examiners also review nonpublic information, including reports from other bank or functional regulators, information submitted in conjunction with applications, and the company’s responses to examination findings and enforcement actions.
What can a regulator do to make a bank comply with laws or improve its operations? Bank supervisors have a variety of enforcement tools to compel banks to comply with laws and regulations and operate in a safe and sound manner. Generally, we start with so-called moral suasion, in which we point out the violations or inappropriate practices and encourage the institution to take corrective action. This is particularly useful when the violation or inappropriate practice was an oversight and management is willing and able to make the necessary changes. If necessary, we can then progressively move through a series of informal, or nonpublic, enforcement actions. When those are ineffective, we can take formal enforcement actions, which are legally enforceable and are published in detail on the Fed’s website. In addition to directing an institution to take certain actions, formal enforcement actions may also impose civil money penalties on the institution or individuals or may remove individuals from the institution and/or prohibit their future involvement in banking. Sometimes the underlying law or regulation provides for a stronger first step, and we may impose civil money penalties or issue a formal enforcement action immediately.
What skills or education do you need to be a bank examiner?
Why haven’t there been many bank runs given the number of banks that have failed? The creation of FDIC insurance has probably been the single biggest factor reducing to almost zero the number of bank runs. The FDIC has also developed a reliable process for closing banks to ensure that customers have timely and uninterrupted access to their money, which has further calmed public fears. As a point of trivia, in 1934, deposits were insured up to $2,500! The level of insurance has steadily increased, reaching $100,000 in 1980 and rising temporarily to $250,000 during the financial crisis in 2008. The Dodd-Frank Act made the temporary 2008 increase permanent in 2010. Today, the FDIC has the authority to increase the insurance limit every five years through an inflation adjustment.
People interested in working at the Federal Reserve should have the education, experience, and skills commensurate with their position. That being said, the Fed trains bank examiners how to examine banks, and we certainly don’t expect entry level examiners to come to us with bank examination skills! Clearly, a financial education (such as a bachelor degree in finance, economics, or accounting) and experience in finance or banking are helpful. But, we have hired staff with liberal arts degrees that have gone on to be very successful examiners. What is perhaps more important today are the “soft” skills that the person brings to the job, including interpersonal skills, critical thinking skills, teamwork and teambuilding skills, and oral and written communication skills. Did this whet your appetite to learn more about the Fed? Keep an eye out for
the next Behind the Scenes event, or visit us online at http://www.federalreserve. AZ CPA gov/ or http://www.frbsf.org/. Cynthia L. Course, CPA, is a principal, Banking Supervision and Regulation, of the Federal Reserve Bank of San Francisco.
Endnotes: 1. Opinions expressed in this article do not necessarily reflect the views of the management of the Federal Reserve Bank of San Francisco or of the Board of Governors of the Federal Reserve System. 2. The Fed’s examination manuals and other supervisory guidance are available at http://www.federalreserve.gov/bankinforeg/ default.htm. 3. The Fed’s examination manuals are available at http://www.federalreserve.gov/ boarddocs/supmanual/. 4. See 12 CFR 261.20. 5. See the Federal Reserve’s searchable enforcement action database at http://www. federalreserve.gov/apps/enforcementactions/default.aspx.
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ing for many years. While the rollover rules are the same as we’ve been used to, these rules must be followed to avoid inadvertent tax consequences or penalties.
How Do They Work?
Demystifying Self-Directed IRAs and 401 (k) Plans by Richard E. Bingaman, CPA In 1974, Congress passed the Employee Retirement Income Security Act (ERISA) making IRA, 401(k) and other retirement plans possible. The regulations created by the Act did not specify a list of allowable assets for investments, rather it specified a very short list of exclusions: collectibles and life insurance (IRS Code Sec. 401 IRC 408(a)(3). Therefore, stocks, bonds and mutual funds are not the only assets a retirement plan is allowed to invest in which may be contrary to what most investment and retirement advisors may be telling you. Other allowable investments include, but are not limited to, real estate, loans and notes, private company stock and precious metals.
A New Alternative for Investing To move outside the stock market for the allowable investments, special types of retirement plans are required. That is where the Self-Directed Individual Retirement Account (IRA) and Self-Administered Solo 401(k) plan come in. There are retirement plan professionals that specialize in setting up these plans in accordance with applicable laws, rules and regulations as established by the Congress of the United States, the Department of Labor and the Internal Revenue Service. A Self-Directed IRA with a special purpose LLC (also known as a Checkbook Control IRA) is available to everyone and the Solo 401(k) plan is designed for self-employed, small business owners who have no full-time employees (other than a spouse). Traditional 401(k) plans may offer self-direction also but the Self-Administered Solo 401(k) plan offers the greatest flexibility and control for self-employed business owners. Both plans offer checkbook control and give the accountholder greater flexibility and control over investing their retirement funds. The rules for retirement fund rollovers from your current IRA or 401(k) plan to a Self-Directed IRA custodian account or Self-Administered Solo 401(k) plan account are no different than the rules governing the rollovers we have been do-
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Self-Directed IRAs grant direct checkbook control for the IRA accountholder with the use of a special purpose limited liability company (LLC) owned by the IRA (work with an IRA custodian that allows such an investment). Every IRA requires a custodian, a company specifically approved by the IRS per IRC section 408, who is the Trustee of the plan. The Trustee role is simply that of investing the plan as directed by the accountholder. The Self-Administered Solo 401(k) retirement plan grants direct checkbook control without the use of a LLC or custodian although a LLC may be owned by the 401(k) plan to make investments while afforded the legal liability protection of the LLC. All 401(k) plans are qualified plans, and qualified plans do not have any special restrictions on who can serve as trustee. The main difference then is that with a Solo 401(k) plan, the participant can actually be the trustee and handle the investment transactions themselves. This simplifies the operation of the plan because there are no third parties involved. Such simplification can also minimize third-party fees such as IRA custodian fees.
Ownership of Investment Assets When you have the responsibility of directing your investments, it is important to understand how assets must be titled. Lack of familiarity with this protocol could result in a “prohibited transaction” as described in IRC Section 4975. IRA Example: If Mary Johnson had an IRA with Lonesome Trust, her IRA assets are titled as follows: Lonesome Trust F/B/O Mary Johnson IRA “F/B/O” means “for the benefit of.”
To realize the benefits of checkbook control with a self-directed IRA, accountholders create a special purpose LLC owned by the IRA but managed by the accountholder. Ownership of the LLC is titled as follows: Lonesome Trust F/B/O Mary Johnson IRA Mary (as the manager of the LLC) would direct investments on behalf of the LLC. Assets owned by the LLC are titled as follows: Mary Johnson IRA Holdings, LLC The Self-Directed IRA allows her to contribute up to $5,000 per year ($5,500 in 2013) to her account (or $6,000 if she’s over age 50, $6,500 in 2013). Solo 401(k) Example: Owning and controlling retirement plan investments in a Self-Administered Solo 401(k) plan is even simpler. Mary is named the trustee of her Self-Administered Solo 401(k) plan. She directs the plan to purchase assets titled as follows: Mary Johnson 401(k) Plan In this case, there is no need to set up an LLC for the purpose of gaining checkbook control. To utilize an LLC for checkbook control and an additional layer of legal liability protection, an LLC is organized and owned solely by the 401(k) plan. Mary (as the manager of the LLC) directs investments on behalf of the LLC. The assets are titled as follows: Mary Johnson 401(k) Holdings, LLC Solo 401(k) plans are easier and less expensive to operate. The contribution limits are also much greater compared to the IRA. Mary serves in the roles of employer, employee, plan participant, plan administrator, and plan trustee. Serving in the roles of employer and employee allows her to contribute up to $50,000 per year ($50,500 in 2013) to her account (or $55,500 if she’s over age 50, $56,000 in 2013). If Mary’s spouse works in the business, they can participate and contribute up to another $55,500 per year ($56,000 in 2013) if the spouse is over age 50.
Checkbook Control or Out-ofControl? You may have heard of potential problems with checkbook control, such as recordkeeping and legal compliance. Individuals should educate themselves on a few things when planning to utilize these plans. The Self-Directed IRA custodian will ask you to complete an annual Fair Market Valuation to determine amounts to be reported to the IRS. The Self-Administered Solo 401(k) plan has an annual filing requirement with Form 5500-EZ which is only required once the plan assets exceed $250,000 in value. There are plenty of retirement specialists and Certified Public Accountants who would be willing to assist with preparing this filing. Of course in order to provide sufficient information to the IRA custodian or to your preparer of the Form 5500-EZ, you must have an accurate accounting of your “self-directed” investment activity including bookkeeping for the LLC. This is a bookkeeping requirement that those who venture into ownership of these types of plans haven’t given much thought to. The issue of checkbook control legal compliance is simple. All self-directed accountholders and participants must avoid “prohibited transactions” as described in IRC Section 4975. Engaging in prohibited transactions may result in the plan losing its tax-exempt status with all plan assets being distributed in a taxable transaction or the amount of the prohibited transaction being voided and considered a taxable distribution. This requirement and responsibility rests solely on the accountholder/participant regardless of whether they have checkbook control and regardless of whether they have a Self-Directed IRA or Self-Administered Solo 401(k) plan. The facts are that when using a SelfDirected IRA or Self-Administered Solo 401(k) plan: • Meeting the annual reporting requirements is simple, and it’s inexpensive to have the Fair Market Valuation prepared for your IRA or Form 5500-EZ prepared for your 401(k) plan. •Keeping an accurate accounting of
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Economic Outlook 2013 Phoenix — Jan 24 Tucson — Jan. 29
11:30 a.m. – 1:30 p.m. Start 2013 ahead of the curve as you gain insight into today’s economy at the ASCPA’s Economic Outlook luncheon in Phoenix or Tucson. Both events will give an overview of the local, state and national economy, including how the election results will make an impact on 2013 and beyond. Dr. Lee McPheters, Research Professor of Economics in the W. P. Carey School of Business at Arizona State University and Director of the school’s JPMorgan Chase Economic Outlook Center, will return for the Phoenix update and Dr. Gerald Swanson, Professor Emeritus of Economics, Thomas R. Brown Chair in Economics Education at the University of Arizona will speak in Tucson. Register online at www.ascpa.com
your self-directed investment activity is as easy as maintaining a set of books, hiring someone to teach you how to maintain this bookkeeping or hiring someone to do it • Learn what financial transactions are prohibited and seek guidance from a retirement plan specialist or Certified Public Accountant to avoid them in your interactions with the plan.
How to Assist Your Clients Here are some ways to assist clients in utilizing self-directed plans optimally in their retirement investment portfolio: • Counsel clients on how self-directed retirement plans operate to take away the mystery of these plans giving them a higher comfort with these valuable retirement investment plans. •Counsel clients on the importance of prohibited transactions relating to these qualified retirement plans to avoid the risk of the IRS disqualifying the plan and creating a premature taxable event. •Counsel clients on maximizing
Health Care Reform—You have questions, we have answers! Did you know that the Patient Protection and Affordable Care Act implements many of it’s components in January of 2014? Did you know that the “Open Enrollment” period begins in just 10 months – October of 2013? Are you and your clients aware of your rights and obligations this law presents to you, your employees and your business? Give us a call so we can help you navigate the many changes coming to health insurance plans for individuals and groups so you have the information you need to help you make some very important decisions.
We can be reached at 602 863-0080, or toll-free at 800-777-5300.
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retirement contributions by advising which plans to set up based upon their individual retirement situation. •Assist clients with structuring the investments and business entities properly to maximize investment returns, minimize administration, avoid prohibited transactions and minimize taxes. Self-Directed IRAs and Self-Administered Solo 401(k) plans provide the most effective and direct way for a retirement plan participant to self-direct investments in their retirement plans. They open the door to the most flexible investing options possible. Of course with greater control over your retirement plan investment options comes greater responsibility for the owner/ participant of these plans to engage in sensible investing practices and follow the rules in order to maintain your AZ CPA plan’s tax-exempt status. Richard E. Bingaman, CPA, is president and CEO of Richard E. Bingaman, CPA, PC. He can be reached at rich@ rebingamancpa.com.
Building
Value Into Your Firm by Ronald C. Parisi, CPA The sluggish economy has presented several challenges to the CPA profession in recent years. A few of the main challenges include: • competing for fewer and leaner clients, putting pressure on fees to be lowered; • funding the retirements of partners preparing to leave the workforce; and • executing leadership succession plans to develop partners. These challenges have led to significant merger and acquisition activity as many CPA firms seek to acquire specialized expertise, provide higher level services, and attract better clients that pay higher fees. Whether preparing for a merger or planning for succession, building more value into the firm is a good idea.
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In this environment it is important for firms to avoid risky practices which would expose the firm to professional liability disputes. Now is the time to remain disciplined, diligent and ethical in one’s practice management. The upside is that good practice management often converges with good risk management. The client acceptance and continuance process is a prime example of this convergence. Not only is it the first step in effective risk management and loss prevention, but client screening can be used to identify less-than-desirable clients that may keep your firm from developing more desirable clients. The client acceptance and continuance process can also reduce the risk of accepting engagements that are not a good fit for the firm’s expertise, or continuing engagements that are no longer a good fit, due to changes in the client’s business or changes within your firm.
Changes Call for Re-evaluating Changes in a client’s business may lead the client in a direction that causes you to re-evaluate the relationship. A client may, for example, buy a business requiring work that is not a good fit for your expertise. Or, a start-up client may grow and decide to go public, and you might not be staffed to perform the public work. When there are changes within your firm, you may also need to re-evaluate your client base. The loss of a partner
with an area of expertise that the other partners don’t possess will require a decision by the firm regarding continued service to the former partner’s clients. The risk exposures from accepting or continuing engagements for which the firm is not staffed or qualified are significant. Substantial losses in revenue and billable time, as well as damage to reputations, can come from disappointing clients with substandard work and becoming embroiled in disputes. Further, violations of professional and ethical standards as a result of substandard work might put a firm’s licenses in jeopardy. Consider options and courses of action that are more productive and profitable than trying to accommodate unsuitable clients. For example, consult with other practitioners to acquire the expertise needed in a specific area, or refer clients to practitioners who have the requisite expertise. Referring clients to other practitioners instead of attempting to perform a service for which you are not well suited is not only the prudent course of action, but it will generate goodwill and respect from clients who will appreciate the referrals. Clients are already accustomed to accepting referrals from their doctors and other professionals, and CPAs will enhance their own reputations by emulating such practices. It’s a good idea to develop a small referral and consulting network among a group of experienced professionals you trust.
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Sometimes difficult clients are just as harmful to the firm as high-risk clients. Are you spending too much time trying to accommodate clients that are uncooperative, uninvolved, indecisive, poorly organized, poorly financed, or irresponsible? If so, you are not only inviting a potential lawsuit, but you are also losing the opportunities to provide additional services to better quality clients and to build a stronger client base.
Terminating the Relationship If you decide that it is in the best interests of the client and your firm to disengage, terminate the relationship professionally and formally, in writing. Your disengagement letter should always contain clear statements, a description of your work, and a list of any due dates or filings. Try to provide ample lead time before a client’s deadlines to better protect yourself. Care needs to be taken when disengaging or withdrawing from an engagement after it has started, especially when the scope of the engagement includes audit, review, or compilation services. Since attestation engagements are often used by the client for obtaining financing or satisfying loan covenants, disengaging while the engagement is in process requires that careful attention be given to potentially negative effects. A jury recently found in favor of a client, partly because of the way the accounting firm disengaged from an attestation engagement after it was in process. The jury found that circumstances of the disengagement caused $50 million in damages to the client. Done effectively, however, a disengagement can leave your client feeling that you have considered their business needs and acted in their best interests. In the end, knowing how to disengage professionally and ethically will help you grow your practice and avoid liability.When in doubt, consult with legal counsel or a risk adviser who is familiar with CPA professional liability AZ CPA problems and solutions. Ron Parisi, JD, is executive vice president of risk management for CAMICO (www.camico.com).
“One change this quarter is the dimmer view survey takers hold of their own company’s outlook over the coming year,” said Arleen R. Thomas, CPA, CGMA and AICPA senior vice president for management accounting. “For the first two quarters in 2012, more than half responded that they were optimistic about their organization’s prospects. Now, only 44 percent say so.”
Business Executives More Pessimistic on U.S. Economy Economic optimism among CPA executives plunged to year-to-date lows as concerns mount over government debt, spending and leadership, according to the AICPA Business and Industry U.S. Economic Outlook Survey. The third quarter 2012 survey of 1,365 CFOs, CEOs, controllers and other CPA decision-makers brings key insights regarding many of the issues of greatest concern to today’s business leaders. The survey was conducted between August 15 to 30, 2012, and reflects the full range of businesses and not-forprofit organizations of varying sizes across the U.S.
Negative Sentiment Sweeps Across Top Economic Indicators In the third quarter, the CPA Outlook Index (CPAOI) continued a downward slide that began in the second quarter, falling four points to 63. The CPAOI gauges CPA executives’ opinions on nine equally weighted survey measures, which range from economic optimism and revenue projections to hiring and spending expectations. On a scale of 0 to 100, a score of 50 is considered neutral, above 50 indicates a positive outlook and below 50 represents a negative outlook. Although all survey measures sustained quarter-to-quarter decreases, U.S. economic optimism, with a 13-point drop and score of 41, was by far the greatest contributor to the Index’s lowered reading. Despite the across-the-board declines since the second quarter, the Index and each measure still rank more favorably than they did one year ago.
Economic and Organization Optimism Continue to Falter Although optimism clouded significantly overall among respondents in the third quarter, conditions worsened more notably in one crucial area—organization optimism. Only 22 percent of CPA executives are optimistic about the U.S. economy, down markedly from the previous quarter’s 34 percent, though appreciably greater than the third quarter of 2011 when a mere nine percent were optimistic. However, survey participants’ outlooks for their own organizations also underwent a dramatic change. Although twice as many respondents are optimistic about their own organization’s prospects than they are about the economy, their responses represent a 10 percentage point decline quarter-to-quarter . This may also be a sign that hiring, spending and other growth indicators are on unstable ground.
Hiring Forecast Remains Gloomy Widespread pessimism may also be taking a toll on CPA executives’ hiring plans. The modest but nonetheless encouraging hiring momentum that started the year was weakened in the second quarter and eliminated in the third. Only nine percent of respondents have too few employees and are planning to hire, which is a drop from the previous quarter’s 12 percent and a 12-month low. Also, the percentage of organizations with an excess number of employees grew, though only slightly, to 11 percent after dropping to a two-year low of seven percent in the first quarter of 2012.
Domestic Political Leadership Rises as a Top Executive Challenge A new list of top challenges for CPA decision-makers has emerged amidst a still-struggling economy. For the past three quarters, domestic economic conditions has held the number-one position, followed by regulatory requirements/changes, and employee and benefits costs. However, there was one change in the top three rankings since the second quarter—domestic political leadership climbed from fourth to third place, with employee and benefits costs falling to the fourth position. Possible reasons for domestic political leadership’s notable rise may be found in the survey’s open-ended comments, which include repeated concerns over the national debt, government spending, the presidential election and other AZ CPA political topics. Please visit AICPA.org for more survey results.
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Classifieds Business Opportunities/ Practices for Sale CPA Firm Seeking to Purchase Clients— North Central Phoenix CPA firm would like to purchase clients in the Phoenix/Scottsdale area from practitioners that are downsizing or retiring. The firm’s office is located near Camelback & 40th Street. Please email phoenixcpaclients@gmail.com for further information. WE BUY CLIENTS— Our CPA firm would like to offer a smooth transition in the purchase of your clients. We will purchase anywhere from one client, up to an entire practice in the Phoenix/Scottsdale metro area. If you are thinking of retiring or downsizing your practice and need to transition your clients to a professional CPA firm, please give us a call. Our staff has been practicing in the valley for over 30 years with an emphasis in business taxes and accounting. Our office is located near Thunderbird and Scottsdale Rd. Please contact us today for more information and ask for Craig (480)990-2727 orcraig@awcpas.com.
CPA—SHERYL K. SACRY, CPA, PC MERGER OPPORTUNITY. We are a small, casual CPA firm in Tempe seeking four-year transition of ownership with CPA experienced in tax and QuickBooks. Sharing of office, equipment, staff, and per-diem work is available during transition. Please email sherylsacry@thetaxlady.biz.
Employment Opportunities TAX MANAGER/CPA, Flowers, Rieger & Associates, PLLC , Tucson CPA firm has an opening for a tax manager with partnership potential. Seven years of current public accounting required. Medical, life and disability insurance, 401k plan and flexible hours. Fax (520) 325-0639 or tim@flowersrieger.com. TAX PREPARER—Established Scottsdale CPA firm needs experienced tax preparer for upcoming tax season. Telecommute. Flexible hours & schedule. 1040s & business tax returns. GoSystem Fasttax software experience a plus. Email resume to recruit@patinella.com, or fax to MP at 480-361-6204.
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CPA/CPA CANDIDATE—Arana & Cordova,P.C. - 1+ years in Public Accounting with experience in tax preparation of individual and business returns, preparation of compiled and reviewed financial statements, using Lacerte tax software, Quickbooks, Peachtree and Excel. http://www.arana-cordova.com SENIOR TAX PROFESSIONAL— BRAUN, P.C.— Tucson tax firm is seeking a Senior Tax Professional with five years recent public accounting experience including preparation and review of all types of tax returns and working directly with clients. Experience with Lacerte and QuickBooks® a plus. Salary DOE and benefit package available. Partnership growth a strong possibility. Position is full-time but candidates seeking flex-time or reduced summer/fall schedule will receive full consideration. Interested candidates may submit a resume to: info@braunpc.com or mail to: 6125 E. Grant Road, Tucson, AZ. 85712. Associate–Business Valuation—Kotzin Valuation Partners is currently seeking qualified candidates for Associate positions in our Phoenix, Arizona office. Primary responsibilities will include financial analysis and modeling, company and industry research, and preparation of valuation and other expert reports to be utilized for valuation, litigation and forensic accounting purposes. Starting compensation will be commensurate with educational background, experience, and professional accomplishments. Relevant qualifications include an undergraduate degree in Finance, Accounting, or Economics. The candidate must have strong quantitative and analytical skills, as well as solid communications skills. Experience in the area of forensic accounting would be beneficial. Reply to: dwenk@kotzinvaluation.com CONTROLLER— WEST YAVAPAI GUIDANCE CLINIC— A Large Behavioral Health Clinic in Prescott, AZ has an opening for a Controller. CPA Certification and a minimum of 4 years experience in Public and/or Not For Profit Au-
diting or Accounting is required. E-mail Resume to d.oliver@wygc.org.
Anna-Paula Lopez, U of A 2012-13 scholarship recipient
PART-TIME TAX PREPARER — Established CPA firm looking for a tax season (Feb 1 – April 15th) part-time (10am – 2pm) experienced tax professional to prepare tax returns for both businesses and individuals. We offer an outstanding work environment and state-of-the-art software and computer equipment. Experience with Ultra Tax is helpful but not required. Salary is competitive and depends on experience. We are located at 7th St/Glendale area of Phoenix. Submit your resume to grsresume@gmail.com.
Office Space OFFICE FOR LEASE — Completely renovated, unique office property on the Historic Registry for lease - $1,850/ month. 4 offices, 1 bath, kitchen with full refrigerator, dishwasher and microwave. Approx. 1,100 square feet. Located in downtown Phoenix’s Roosevelt District, minutes from the State Capitol, CityScape and other amenities. Easy access to the I-10 Freeway. New A/C, plumbing, electrical, heat, roof, fixtures, hardwood floors, fenced backyard, and more. Renovations completed Aug. 2012. Landscape maintenance included in lease. Landlord is local and accessible. For more information or to schedule a showing, call 602-266-8339.
Services CPA WANTED FOR INTERNATIONAL STARTUP — International startup is seeking accounting services in exchange for building professional website and advertisement campaigns. Contact usabusiness@panaco.hu for further details. PROPERTY TAXES TOO HIGH? I’ve been successfully appealing property tax assessments for almost 15 years, both real estate and personal (business) property on a contingent fee basis. The annual business property reports are also filed for a flat fee. Reasonable rates. Arizona CPA. Visit my pages on Linked In, Facebook & Twitter. Call John at ASMR Consulting LLC, 480-204-1289.
Andrew Miller, NAU 2012-13 scholarship recipient
Brianna Arendt, ASU 2012-13 scholarship recipient
Give Back to the Profession with the Gift of Scholarship “During my time at ASU, I was a recipient of a scholarship to study accounting and it meant a great deal to me. I was working 16-20 hours a week and it was a struggle to make ends meet. I think it is important to ‘pay it forward’ and encourage young people to join our profession.” —Karen Abraham, CPA, CFO/Chief Accountant, Blue Cross Blue Shield of Arizona The Arizona CPA Foundation for Education & Innovation supports future CPAs through scholarship programs from the freshman through master’s level. Help us continue to assist these students in fulfilling their dreams of becoming a CPA. Donate online at www.ascpa.com, click on About and then Education Foundation or mail a check written to the Arizona CPA Foundation for Education & Innovation to 4801 E Washington St., Suite 225-B, Phoenix, AZ 85034.
Contact Heidi Frei for more information at hfrei@ascpa.com. DECEMBER 2012 y AZ CPA
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Arizona • California • Nevada
24 AZ CPA y DECEMBER 2012
“Working closely with my clients’ CPAs and other trusted advisors ensures that all bases are covered, whether I am helping to form a new business, buy or sell an existing one, plan for succession of a business or create an estate plan. In every case, the clients’ interests are best served through collaboration. Having previously practiced as a CPA with a Big Eight accounting firm, and also making sure that all of the accounting, tax and legal needs are coordinated to attain the best possible result for the client, I understand and appreciate the important role of CPAs.”