New Jersey CPA - Summer 2021

SUMMER 2021

ACCELERATING

VIRTUAL 2.0 — LESSONS LEARNED IMPLEMENTING TECHNOLOGIES ON AN ACCELERATED SCHEDULE CYBERSECURITY: A COMPREHENSIVE APPROACH

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Guidance and Learning Financial and Insurance Practice Management and Development

contents SUMMER 2021

THE MAGAZINE OF THE NEW JERSEY SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS

4 Virtual 2.0 – Lessons Learned RALPH ALBERT THOMAS, CPA (DC), CGMA Chief Executive Officer & Executive Director rthomas@njcpa.org THERESA HINTON Chief Operating Officer thinton@njcpa.org DON MEYER, CAE Chief Marketing Officer dmeyer@njcpa.org RACHAEL BELL Managing Editor rbell@njcpa.org KATHLEEN HOFFELDER Senior Content Editor khoffelder@njcpa.org DIANE ESPIRITU Senior Graphic Designer despiritu@njcpa.org

All accounting professionals were affected by the COVID-19 pandemic, from interns and entry-level staff trying to learn the ropes to the managing partners and CFOs keeping their businesses and customers afloat. Along the way, they learned how to adapt to the virtual way of operating — not only persevering but transforming their roles and the profession along with it.

8 Implementing Technologies on an

Accelerated Schedule

It used to take years to implement new technologies and accomplish everything that needed to be done. Now there are proven project management methodologies that all accounting professionals can use that can cut the time needed to months instead of years.

10 Cybersecurity: A Comprehensive

Approach

Though remote computing has existed for decades, what was essentially a trickle of workforce participation has turned into a waterfall. With a large workforce operating outside the traditional office, it’s worth reviewing cybersecurity. How safe is your data with staff working from home?

2 CLOSE UP

16 FIRM MANAGEMENT

22 TECHNOLOGY

Getting to Know Harry Wills

6 Steps to Generate Leads from Social Media

The Latest Trends in Blockchain and Crypto

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17 INDUSTRIES

24 NJCPA NEWS

13 BECOMING A CPA

18 PROFESSIONAL DEVELOPMENT

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Passing the CPA Exam: It Takes a Village

Top 5 Excel Skills for Entry-Level Staff

14 BUSINESS MANAGEMENT

20 RISK & COMPLIANCE

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5 Steps for Performing Single Audits in a COVID Environment

Mentoring Can Provide Sustainable Benefits 15 FINANCIAL PLANNING SERVICES

The Advantages of Individual Equity Portfolios

Crypto-Cannabis Collaboration: Implications and Considerations

Do You Really Need a Cyber Insurance Policy?

21 TAX

2012 Estate Tax Planning Redux: Everyone Gets a SLAT

y 2021/22 NJCPA Leaders y NJCPA Virtual Convention to Drive Profession Forward y In Memoriam y 30 Under 30: Then and Now y NJCPA Awards Scholarships y NJCPA Tax Call-In a Success 31 CLASSIFIEDS 32 MEMBER PROFILE

Edward K. Zollars, CPA

CLOSE UP

Getting to Know Harry Wills

BY KATHLEEN HOFFELDER, NJCPA SENIOR CONTENT EDITOR

The New Jersey Society of CPAs is pleased to welcome Harry P. Wills III, CPA, CGMA, a partner at Bowman & Company, LLP, as its 2021/22 president, succeeding Alan D. Sobel, CPA, CGMA, managing member of the firm at SobelCo, LLC. Harry, a staunch supporter of growing the CPA pipeline and fostering the next generation of CPAs, plans to focus his energy as president on assisting young accountants in the workplace. He believes it’s crucial to advocate for more entrants into the profession and to encourage them to work towards the CPA. “For our profession, the young accounting professionals are important, especially for CPA Evolution (an initiative designed to transform the CPA Licensure Model to recognize changing accounting skills),” he says.

Mentoring, providing on-the-job training and encouraging leadership among those young accountants already in the profession, he explains, will go a long way.

“Historically, CPAs’ starting salaries are lower than finance. We can’t compete with the Wall Streets of the world, but we have to convey that this is a wonderful opportunity here. I think we can do a better job in getting that message across. We need to explain and highlight these opportunities.”

MORE INCLUSION At Bowman, which serves a variety of industries, including governmental, construction, healthcare and not-for-profits, Harry routinely mentors staff as part of their professional growth and retention.

Bowman ensures diversity, equity and inclusion (DEI) practices are maintained in the office. Harry supports more DEI programs in accounting overall, seeing a need at the high school and college levels.

“We can certainly make more of an effort in the inner-city high schools,” says Harry, noting the need to encourage more students of minority backgrounds to consider the accounting profession. Of course, it will not happen overnight. “It’s a process. I think you will see in 10 years this will be paying off.”

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attend programs to build awareness of the profession.

Financial support and educational awareness may be at the heart of what’s needed to include more diverse accounting professionals in the industry, he notes.

Employers should assist those individuals already employed to take the CPA Exam with review class compensation, such as interest-free loans or something comparable.

At Bowman, they recognize this importance and provide individuals with bonuses after completion of the CPA Exam. They also invite the local community colleges in the Camden area to tour their offices and

BEYOND ACCOUNTING As a member of Rotary International for over 25 years, Harry sees first-hand the needs of young people, not only in his community but globally as well. “As part of that community service organization, my wife, Alexandra, and I have been very involved in youth activities.” Harry, his wife and family have hosted three international exchange students from Chile, Brazil and Japan, and he sponsored a number of students from local high schools to attend the Rotary Youth Leadership Awards program at Stockton University.

Giving back to the youth of the community is also something that’s important to Harry as he works with Symphony in C, one of the largest musical educational programs in the area. Harry has been on their board for the past 10 years. “It’s wonderful to see that we’re providing young musicians with the opportunity to join bigger orchestras, such as the Philadelphia Orchestra and Cleveland Orchestra. Symphony in C is one of only three training orchestras in the United States and it’s one of the best-kept secrets right here in Camden, New Jersey.”

Harry enjoys traveling, golfing and spending time with his family. He and his wife have three children and six grandchildren.

Learn more about Harry at njcpa.org/ about/board.

New Jersey CPA (ISSN 1534-6692) is published quaterly by the New Jersey Society of Certified Public Accountants, 105 Eisenhower Parkway, Suite 300, Roseland, NJ 07068. Issue No. 87 Copyright © 2021 New Jersey Society of Certified Public Accountants. Annual membership dues include $9 for a one-year subscription to New Jersey CPA magazine.

Members may not deduct subscription price from dues.

Periodicals postage paid at Roseland, NJ, and at additional mailing office. POSTMASTER: Send address changes to New Jersey CPA, 105 Eisenhower Parkway, Suite 300, Roseland, NJ 07068-1640.

The materials and information contained within New Jersey CPA are offered as information only and not as practice, financial, accounting, legal or other professional advice. The opinions expressed herein are those of the authors and not necessarily those of the New Jersey Society of CPAs. Publication of an advertisement in New Jersey CPA does not constitute an endorsement of the product or service by the New Jersey Society of CPAs.

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VIRTUAL 2.0

Lessons

Learned

By KATHLEEN HOFFELDER, NJCPA SENIOR CONTENT EDITOR

Contributors (in order of apperance)

MARTIN McCARTHY, CPA, CCIFP

SALVATORE COLLEMI, CPA

STEVEN BUDRYK, CPA, MS

NICOLE DEROSA, CPA, MaCC

Managing Partner

Partner

Managing Member

Accountant

Senior Tax Manager

McCARTHY & COMPANY, PC

WITHUM

COLLEMI CONSULTING & ADVISORY SERVICES, LLC

TRAPHAGEN & TRAPHAGEN CPAs, LLC

WISS

KATHLEEN CAMINITI, ESQ.

NICOLE GARCIA Accountant

BARRY S. KLEIMAN, CPA

BARRY C. MELANCON, CPA, CGMA

New Jersey Partner, Co-Chair Wage and Hour Practice

TRAPHAGEN & TRAPHAGEN CPAs, LLC

Principal

President and CEO

UNTRACHT EARLY LLC

AMERICAN INSTITUTE OF CPAs

MARC STAUT Shareholder, Chief Innovation and Information Officer BOOMER CONSULTING, INC.

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JAMES C. BOURKE, CPA, CITP, CFF, CGMA

FISHER PHILLIPS

SUMMER 2021 | NEW JERSEY CPA

Looking in the rearview mirror at the way CPAs and other accounting professionals conducted themselves during the COVID-19 pandemic, one can see that they managed near-impossible feats.

Not only did CPAs digest new tax laws, understand federal guidance and initiate loan applications all in the blink of an eye — they also maintained, and in most cases, enhanced their customer-centric focus by handholding clients and organizations while doing everything virtually. At a longer glance, they didn’t just pivot away from old ways of functioning; CPAs and other accounting professionals reset, redirected and reconfigured what they could to deliver for their companies and clients. And, in the process, they transformed their role in the accounting profession — perhaps, forever.

Every accounting professional was affected by the COVID-19 pandemic and its subsequent implications, from interns and entry-level staff to managing partners and CFOs. As a 2021 AICPA blog1 reveals, those in business and industry were not immune to that transformation as more responsibilities were collectively heaped on them and they excelled in many new ones. According to the blog, “…CFOs and other finance professionals have moved out of their own realms during the pandemic to become more involved in a variety of other areas, such as supply chain and liquidity concerns.”

The same goes for accounting firms.

CPAs and their staff learned it wasn’t enough to simply inform customers about new tax laws; to truly earn their “essential” status, they needed to help manage, direct and strategize side by side with those hair salon and pet shop owners more than ever before. As Martin McCarthy, CPA, CCIFP, managing partner of McCarthy & Company, PC, points out, the pandemic showed the need to be proactive and “get ahead of the curve.” His company’s decision to launch Paycheck Protection Program (PPP) loan consulting assisted in buoying clients as well as his own firm. “This has helped us to build deeper relationships with our clients while providing them with valuable services to keep their businesses going. It has also given us the opportunity to increase billable hours on many engagements, and our realization rate has increased by 4 percent.”

The pandemic also led accounting firms to start offering completely new services.

James C. Bourke, CPA, CITP, CFF, CGMA, a partner and managing director of Withum’s advisory services practice and a keynote speaker at the NJCPA Virtual Convention in June, says the pandemic led his firm to launch cybersecurity consulting services to assist clients with concerns relating to the new remote work environment and to use tools like Microsoft Power BI to help those having data analysis and visualization challenges. “With this pandemic continuing to hang around, I encourage all practitioners to search for that silver lining and ask their clients about ways that they can help them outside of the traditional accounting and tax space,” says Bourke.

Salvatore Collemi, CPA, managing member and founder of Collemi Consulting & Advisory Services, LLC, recognized the added services clients were clamoring for at the height of the pandemic. Collemi, who already had virtual offerings in place and international customers before the pandemic, acknowledges that his “business was born in the virtual space.”

Expanding on his current audit expertise and data analytics offerings, Collemi realized that CPA firms needed technical accounting and auditing consulting services now more than ever. “I knew virtual was

NEW JERSEY CPA | SUMMER 2021

5

going to be the wave of the future, but I did not think it was going to come so rapidly,” he explains.

While most of Collemi’s business was already set up virtually, managing CPE training sessions did pose some challenges when having to convert from in-person to an all-remote format. “Physical CPE instructing got disrupted. We had to learn how to instruct differently and how to keep the audience fully engaged in the virtual realm. This was a new skill that instructors had to learn,” says Collemi. When he first started his business in 2016, he questioned whether technical consultants would be in demand thousands of miles away, but “now people are gravitating towards it as a new alternative,” he says.

Good communication — and a lot of it — also helped keep clients satisfied and businesses afloat during the chaos of last year. As McCarthy acknowledges, “We sent out hundreds of alerts on topics ranging from government stimulus programs, state mandates, HR issues, legislation, accounting and tax updates, as well as safety protocols.

Our goal was to provide a myriad of information that we considered essential to get through the pandemic.”

VIRTUAL EFFICIENCY Conducting almost everything virtually created both advantages and disadvantages when communicating with clients, vendors and other company executives. “The main challenges we have faced throughout this period are the reduction in face-to-face client meetings/correspondence and working on projects with those who’s in-office schedule does not follow your own. While going virtual with a flexible work schedule has its benefits, the loss of being in the same room with a client or colleague can never be replaced,” says Steven Budryk, CPA, MS, an accountant at Traphagen & Traphagen CPAs, LLC. Training staff was also difficult. “One of the major challenges I have faced with going virtual and having hybrid work schedules was ‘on-the-job training,’” explains Nicole DeRosa, CPA, MAcc, senior tax manager at Wiss. “The days of walking over to a cube to show a staff member how to do something have been replaced with screen

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sharing and phone conversations. As an instructor, it was much easier to engage with those in a classroom setting compared to a virtual setting,” she said, noting that improvising to ensure staff are where they should be from a development perspective has become more important than ever.

“Being that I am an old soul, I personally miss the face-to-face interaction when it comes to staff training.”

But with technology, video conferencing and a greater emphasis on phone calls, Budryk explains that virtual meetings came to be so effective, they were often preferred by clients — something that’s likely to last beyond the pandemic. “There have been multiple instances where clients have virtually ‘walked away’ from meetings where they understood more clearly the information presented when compared to the ‘old way’ of meetings,” he says. “In previous meetings, oral communication reigned superior; now through virtual meetings, data and other reports become priority followed by a robust discussion.”

Similarly, lessons from going virtual did not fall on deaf ears. According to Marc Staut, shareholder and chief innovation and information officer at Boomer Consulting, Inc., and a keynote speaker at the NJCPA Virtual Convention in June, “Many of our clients have found that, contrary to their initial expectations, and with a little effort, they have been able to build closer relationships with their clients. The virtual interactions have simplified reaching out to connect more often, and the topics have been much more wide-ranging and truly advisory instead of transactional.”

And, for some, updating technology ahead of the pandemic paid off in spades.

“Although we were not prepared for the complete devastation that the pandemic brought upon our nation, as a firm, we were well prepared for adjusting to the new remote work environment,” said Bourke, having decided years ago to migrate Withum's systems to the cloud. “Although we dove into the cloud prior to the pandemic, I often say that it took a pandemic to get our team members to embrace the remote-work concept.”

REMOTE ISSUES Managing a remote workforce has come with its own hurdles, however, whether accounting professionals are at the bottom of the staffing ladder or are a managing partner or CFO. According to Kathleen Caminiti, Esq., New Jersey partner at Fisher Phillips and co-chair of the firm’s wage and hour practice, wage and hour compliance, employee engagement and retention — especially of women in the workplace — and employee relations are all issues that have to be dealt with before any kind of “normal” workforce return can happen.

Adds Caminiti, “Remote work has created even more challenges for working women, so employers must step up to help curb the long-term damage that has been done over the past year. Additionally, it has been widely reported that the pandemic has driven many women from the American workforce and has created challenges for employers in retaining this critical part of our workforce.”

For those looking to network or switch jobs, the prospects have also been bleak with only remote events or activities. Like others in the business world, accounting professionals were not able to keep up that in-person skillset of networking as opportunities slowed down immensely or completely stopped. Some outliers exist, for sure, but in general networking is not occurring at the pace it was prior to the pandemic, though most in the industry are hopeful some semblance can return eventually. With the exception of the occasional virtual happy hour or learn-tocook class, for example, CPAs and accounting professionals have had difficulties in meeting new customers, clients and colleagues.

Interns perhaps more than any other group of individuals felt the impact of minimal networking during the past year.

Since it was harder to obtain internships, as offices cut back on expenses, few had overly bright job prospects and crucial experience ahead of taking the CPA Exam.

Nicole Garcia, an accountant at Traphagen & Traphagen CPAs, LLC, says she was lucky to have already interned at her firm two years prior to the pandemic, but the same cannot be said for many of her classmates. “I think the most damaging

effect of the pandemic on accounting students is the limited opportunities within the industry at this moment and the difficulties associated with networking virtually.”

As she explains, the pandemic will limit candidates’ exposure to the profession prior to sitting for the Exam. “From what I have seen, students are not participating in onsite internships which I believe are essential to one’s success within the industry,” she said.

Some new hires, though, did get onboarded virtually, with some success.

As Bourke notes, “We found that we were able to deploy a whole new class of new hires (in excess of 100) totally remotely.”

This was done by shipping laptops via FedEx, he says, and training virtually.

RECOGNIZING STAFF CPAs and other accounting professionals had, and continue to have, many items on their plates during the pandemic, whether they work in public or private practice or

work as part of a team determining corporate, governmental/nonprofit or academic budgets and policies for their organizations.

But the most savvy professionals did not forget about their employees. Keeping staff motivated during these turbulent times has been top of mind for all kinds of businesses, particularly CPA firms.

Barry S. Kleiman, CPA, principal of Untracht Early LLC, made it a priority to keep his staff engaged during the pandemic. “In lieu of in-person office socialization, our firm held small group events, happy hours and a choose-a-Zoomholiday-party activity, where employees were able to participate in and interact with a smaller group of their peers. In the spring, they also helped raise funds while getting healthy and supporting their favorite charities. “Our regular firm town halls are also an important part of staying connected and disseminating information, especially during these unusual times,” adds Kleiman.

As Barry Melancon, CPA, CGMA, president and CEO of American Institute of CPAs and an NJCPA Virtual Convention keynote, explains, “At the AICPA, we realized early in the pandemic that we needed to focus on our people and enhance the support mechanisms we already had in place. We’ve responded with all-employee webcasts where we discuss mental health, along with practical resources that we update frequently.” He added, “As part of our commitment, all staff took a mental health day in early November.”

1 “How your peers are moving digital transformation forward,” blog.aicpa.org/2021/02/how-your-peers-aremoving-digital-transformation-forward.html

LEARN MORE June 15-18

NJCPA VIRTUAL CONVENTION — ACCELERATING CHANGE

njcpa.org/convention

NEW JERSEY CPA | SUMMER 2021

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IMPLEMENTING TECHNOLOGIES ON AN ACCELERATED SCHEDULE

By DONALD KAISER, CPA McCARTHY & COMPANY

CPAs are trained to be methodical. They know how to break down assignments into smaller tasks to complete projects on time and within the established budget. That’s why they are perfect to work on complex projects that involve implementing technologies, especially on an accelerated schedule.

The longer it takes to complete a project, the higher the cost of capital investments and human resources. CPAs working on an internal IT project are often pulled from billable assignments. Since CPAs often bill on an hourly basis, every minute they are in a meeting, reviewing project specs or working on another task costs the company money.

PROJECT MANAGEMENT FRAMEWORKS CPAs can borrow best practices from engineers, IT consultants, project managers and other professionals. One such practice is working within a project management framework, which refers to a set of methods, procedures and rules that relate to and cover the entire lifecycle of the project. It defines a project’s charter, scope and purpose by specifying and delineating the processes, steps and actions needed to execute the job from initiation to delivery.

There are many phases in a project management framework. These include initiation, planning, execution, performance control and closure.

The benefits of using a project management framework are: y Consistency in project planning and execution y Clarity in the scope of the project y Collaboration between stakeholders throughout the lifecycle of the project y Continuity and planning integration throughout the project

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y Communication among the team when defining the scope and purpose of the project.

PROJECT MANAGEMENT METHODOLOGIES There are many good project management methodologies that can be used to control the flow of work when implementing new technologies. These include but are not limited to the following: y Waterfall is a simple project management method used for short, uncomplicated projects. It involves listing the tasks that need to be done in sequential order and checking them off as they are

done. For the Waterfall methodology to be successful, tasks must include every step that needs be accomplished arranged in a logical, chronological order.

CPAs must invest time in the beginning of the project to identify everything that needs to be done. y Agile is ideal for complex projects with high uncertainty and likelihood of change, including new designs, problems and exploratory work. Agile gives project teams the ability to create

SIX SIGMA Six Sigma is a methodology that allows organizations to make operations more efficient by reducing variation and eliminating defects. CPAs can benefit from working more effectively and efficiently on internal and external projects. The company will save money by having fewer resources (people) invested in the project.

The opportunity costs could be substantial. Operations will improve by having more efficient systems in place, more billable work can be completed because professionals will have additional time available and realization rates should improve because the actual hours worked on the engagement should decrease.

Six Sigma focuses on producing measurable results during a defined time frame of typically 12 to 16 weeks. Projects are completed in a reasonable timeframe so that management and the project team remains focused and there is momentum for continual improvement. It also ensures that the team and resources are available for the duration of the project.

Two methodologies are used in Six Sigma: y Define, measure, analyze, design and verify (DMADV) is for new projects or processes. It involves:

and respond to change in real time.

Agile methods can help CPAs to be more proactive and solutions focused.

Challenges can be identified before they become problems which will save money. y Lean is a form of Agile project management that targets doing more with less. Lean project management methods, such as Six Sigma, provide the tools and techniques to make businesses more effective and efficient.

CPAs will benefit from implementing lean practices. Time and money will be saved because of efficient workflow and enhanced processes.

• Defining design goals for the new process • Measuring the required quality characteristics, product or production process capabilities and associated risks • Analyzing the findings to develop an appropriate solution • Designing the new product or process • Verifying that the new process works as intended y Define, measure, analyze, improve and control (DMAIC) is a methodology applied to existing systems that need improvement. It involves: • Defining the problems and project goals • Measuring data related to current processes

• Analyzing the findings to identify the root cause of the problem through cause-and-effect relationships • Improving existing processes based on data analysis • Controlling the process to avoid variations in the process going forward By following the principles of Six Sigma, a team can create a solutions-based implementation plan. This will give the project team a roadmap for making the change happen within the desired timeframe.

Members of the project team must be given adequate time away from their normal activities to devote to the project.

Accelerated project work requires members of the team to attend every meeting, come prepared to each meeting and be ready to discuss in detail the task(s) that were assigned to them. Whether meetings are held virtually or in-person, the tools should be available to foster collaboration and sharing.

A project management framework will define a project’s scope and purpose.

Processes, steps and actions will then be defined and implemented throughout the project’s lifecycle — helping to run the project more efficiently, saving CPAs, their companies and their clients time and money.

Donald Kaiser, CPA, is a partner with McCarthy & Company, a leader in construction accounting.

He is a member of the NJCPA and can be reached at donald.kaiser@McCarthy.CPA.

LEARN MORE June 7, July 9 or Aug. 27, Live Webcast

PROJECT MANAGEMENT: TIPS, TRICKS AND TRAPS

June 15, July 13 or Aug. 11, Live Webcast

HOW TECHNOLOGY IS IMPACTING THE ACCOUNTING PROFESSION

Oct. 27, Live Webcast

EMERGING TECHNOLOGIES CONFERENCE

njcpa.org/events

NEW JERSEY CPA | SUMMER 2021

9

CYBERSECURITY: A COMPREHENSIVE APPROACH

By ANTHONY MONGELUZO PCS

Cybersecurity has been linked to computer use from the first day hackers made an appearance. The coronavirus pandemic has changed the thread of the security conversation like never before.

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SUMMER 2021 | NEW JERSEY CPA

Though remote computing has existed for decades, what was essentially a trickle of workforce participation has turned into a waterfall. With a large workforce operating outside the traditional office, it’s worth reviewing cybersecurity issues from outside the office walls before turning inward.

HAVE COMPUTER, WILL TRAVEL? Not quite. This is an unexpected issue that my accounting clients and others ask. How safe is our data with staff working from home? If a team member uses their own computer and connects to your network, it presents a plethora of security issues. It dramatically increases the possibility that their device is the attic door to someone hacking your business. Here is a simple analogy: If you are circumspect about your home security and allow a dog walker, house cleaner or neighbor to have entree, an intruder only has to obtain the key or combination from any of these people to enter. The same principle applies to an employee entering your system with their own computer. You cannot know the quality of safeguards on each staffer’s personal computer and whether it is equal to what you use on the office’s network.

The choice is yours. You can accept the risk and reach for your prayer beads, hoping for the best. Allowing staff to use their devices creates problems of uniformity and security. Each individual computer could have a different security configuration.

Also, you face the possibility that a wide variety of technical issues will arise that your IT person will have to confront. Think of a mechanic and your Audi. Do you want the guy who works on Audis every day or the one who sees one Audi per month?

One way to solve the issue is to make the investment and provide all your employees with a company laptop (or yes, even desktop) which is explicitly configured with your safeguards in place. You add uniformity to the security issue and stunt possible technical issues.

Another benefit is that you eliminate downtime. Don’t assume there’s a computer for everyone in a household. If you need that report by 6:00 and your staffer has a high schooler who needs to log in for the advanced placement test, the last thing you need is conflict over who gets to use the computer. And a smartphone is not always the obvious answer.

If an employee uses a company computer, you can configure it the way your IT person or consultant suggests, ensuring that everyone is on the same page with capability and security issues, including monitoring how a staffer uses it. According to the Ponemon Institute’s 2018 State of Cybersecurity in Small and Medium Size Businesses study, “Mobile devices are the most vulnerable endpoints or entry points to networks and enterprise systems, according to 55 percent of respondents. Almost half (49 percent) of respondents say the use of mobile devices to access business-critical applications and IT infrastructure affects their companies’ security posture.”

CYBERSECURITY ACTION PLAN The following tried-and-true tactics can bolster your company’s security: y Perform proper backups. I still see businesses (yes, even accounting firms) that regularly fail to back up their data.

I’ve covered this before: offsite, onsite and DON’T keep the hard copy at the office (flood, fire, burglary). This trident security approach will provide the backup you need. y Segment access. Who has access to client data? This can be touchy. It begins by encrypting your drive, resulting in only allowing some employees to have access. If you have a more extensive accounting practice, it is almost mandatory that you segment access according to a need-to-know formula.

y Create complex passwords. To protect your security, use a screen saver that automatically appears after a few minutes.

You don’t need someone strolling past and seeing someone else’s logon. This approach, combined with a multifactor authentication routine, creates a tricky bridge to cross if someone is trying to enter your digital realm. y Test, test, test. This is where a few accountants I’ve worked with become uncomfortable. If I bring up the issue of security, they casually say, “Anthony, we have an excellent system. We’ve been reading your column in New Jersey CPA magazine.” The discomfort arises when I ask: “How do you know?” You need to have a threat assessment test against your network. I have a friend, an older fellow, who is a world-class jiu-jitsu competitor. He surprises people at the local level with his skill. Yet he still competes at the world championship level for one reason: He wants to find out how good he really is. He confirms his skill level — win or lose — and it gives him a clearer picture of his shortcomings. Some in-house IT personnel are adept at threat assessment; many are not. The best approach is a disinterested party, intent on (theoretically)

taking your system down. That’s the only way you’ll know — like my worldclass jiu-jitsu competitor friend — how good your defenses are. y Fortify the fortress. Employ a higher-end security system. I’m not referring to Windows Defender (which is generally fine for home use). An example is Carbon Black, which offers exceptional protection.

ROI A few of my suggestions can lead to increased investment. It’s not a dreadful amount (unless your organization has 50 employees who need laptops) but it requires a change in mindset. If you fail to make some of these fundamental changes, you’re going to grimace when undoing the damage of an intrusion. Consider that the work-from-home environment will not remain an isolated phenomenon. A portion of the workforce might never return to the office full time after the pandemic ends.

For some, even if part time, working from home will be permanent.

Finally, I’m not a lawyer, but there could be legal repercussions from an intrusion, if it affects your client or customer list. Having a robust cybersecurity system in place provides significant evidence as a potential

defense but the best defense is ensuring your data remains safe and sacrosanct with a security plan and systems that protect it.

Anthony Mongeluzo is the CEO of PCS, a 150-person IT managed services and support firm that provides technology solutions to a national client base. He can be reached at Anthony@helpmepcs.com, on Twitter at @PCS_AnthonyM or online at helpmepcs.com.

LEARN MORE June 15-18, NJCPA Virtual Convention

THE CPA HACK: WHY THEY TARGET PEOPLE LIKE YOU AND NOT COMPUTERS

njcpa.org/convention

READ MORE RISK MANAGEMENT ARTICLES AND RESOURCES

njcpa.org/topics/risk

DO MORE

EARN AN AICPA CYBERSECURITY CERTIFICATE

njcpa.org/certificates

NEW JERSEY CPA | SUMMER 2021

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ACCOUNTING, AUDITING & ATTEST

5 Steps for Performing Single Audits in a COVID Environment

BY COLLEEN CULLARI, CULLARI CARRICO, LLC

Early in my career, when making the transition from auditing large public companies to auditing nonprofit organizations, I thought, “this will be easier.” Then I started my first single audit engagement, and I was overwhelmed. Years later, and knowing what I didn’t know then, I realized it’s all about following the steps. In light of the pandemic, the same overwhelming feeling came over me. But now, a year later, I understand it’s still all about following the steps. These include the following: 1. USE THE CORRECT COMPLIANCE SUPPLEMENT Ensure you’re using the correct version of the compliance supplement — the 2020 Addendum that was released in late December 2020. The American Institute of CPAs (AICPA) did an excellent job of describing it in a very brief summary, 2020 OMB Compliance Supplement and Related Addendum (By Section).

2. OBTAIN THE SEFA Next, obtain the Schedule of Expenditures of Federal Awards (SEFA) from clients.

It may not look pretty and, it’s fair to say, it may also be incomplete or even wrong.

Nonetheless, it’s a starting point. It’s helpful to provide the listing on pages 4-13 of the “CARES Act and M-20-21 FAQs” to clients and specifically ask if they have received any new or additional funding.

Using the current SEFA the client provided, one can even specifically point to the Catalog of Federal Domestic Assistance (CFDA) programs that could be applicable based on their current programs.

Since the completeness of the SEFA is generally high risk on many single audits (especially in light of the new funding streams), it’s wise to perform extended procedures by completing a search for unrecorded grant awards. Additionally, in all instances, one should also obtain a GN-06 report from the State of New Jersey (since some client awards are pass-through

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SUMMER 2021 | NEW JERSEY CPA

funding). If there are any payments that look out of sync or have a different program name or description, ask about it.

3. UPDATE THE SEFA Once you have the SEFA, you’ll need to update it and report any findings that arrived from testing for completeness as well as additional items required for pandemicrelated funding. In 2020, this is critical because one needs to: 1) strip out any grants that were received for personal protective equipment (PPE), as the addendum specifies they should not be included; 2) include a footnote to the SEFA, marked as “unaudited” to describe the nature of fair value of PPE received; and 3) separately identify COVID-19 expenditures on the SEFA on a separate line by CFDA number with “COVID-19” as a prefix to the program name.

It is important to note that per the Office of Management and Budget Memorandum M-20-21 and the CARES Act Pub. L. No. 116-136, reporting requirements apply to recipients receiving $150,000 or more in funding related to the pandemic.

4. COMPLETE THE MATRIX After identifying major programs — including any “new” programs in light of the pandemic — use the Matrix (in both the compliance supplement and addendum to the supplement) to test internal controls and the specified various compliance components. The addendum advises that for audits of fiscal years after Sept. 30, 2020, regardless of pandemic-related funding, if reporting is identified on the Matrix for a major program that will be tested, the auditor is required to test Federal Funding Accountability and Transparency Act (FFATA) reporting. However, auditors do not have to conduct FFATA testing for clients who do not receive direct federal funding or do not make subawards over certain dollar thresholds.

The basic questions requiring a response are as follows: 1. Did the client make a subaward of $25,000 or more?

2. If so, did they register in the FFATA Subaward reporting system (FSRS)?

3. If so, did they report subaward data through FSRS? 5. DOCUMENT AND REPORT Lastly, conclude report and finalize documentation for the audit.

The information available through the OMB, Audit Quality Center, Federal and State Award agencies websites and elsewhere on the internet can be overwhelming. However, considering all of the changes; the reporting may look a little different, but the process generally remains the same. So, the best advice is to just follow the steps.

Colleen Cullari, MBA, is an audit manager at Cullari Carrico, LLC. She is a member of the NJCPA Accounting & Auditing Standards and Nonprofit interest groups. Colleen can be reached at ccullari@cullaricarrico.com.

LEARN MORE July 13, Live Webcast APPLYING THE UNIFORM GUIDANCE IN YOUR SINGLE AUDITS

Oct. 18, Live Webcast

ADVANCED TOPICS IN A SINGLE AUDIT

Dec. 22, Live Webcast

PERFORMING SINGLE AUDITS UNDER THE UNIFORM GUIDANCE FOR FEDERAL AWARDS

njcpa.org/events

BECOMING A CPA

Passing the CPA Exam: It Takes a Village

BY DR. BARRY PALATNIK, CPA, AND JOHN BOYLE, CPA, STOCKTON UNIVERSITY

There’s no debating it: the CPA Exam is hard. Fortunately, there are resources available and programs that can be implemented to improve CPA candidates’ success in passing the Exam.

NASBA AND AICPA RESOURCES The National Association of State Boards of Accountancy (NASBA) offers Exam candidates an online resource called the Uniform CPA Examination Candidate Bulletin, which outlines a five-step process that begins with preparing for the CPA Exam and ends with how to retrieve Exam scores.

The American Institute of CPAs (AICPA) provides the following recommendations for CPA candidates to effectively prepare for the Exam: y Understand the three Es (education, experience and exam). The website thiswaytocpa.com is a robust resource to help with this. y Understand the Exam content and how the material will be tested. The CPA Exam Blueprints help accounting students to understand Exam content and how the content is tested. y Practice time management with studying and managing the 18-month window. y Create a support network for encouragement to include mentors, colleagues, family and friends. y Explore CPA Exam partners such as AICPA, NASBA and Prometric.

COLLEGE CURRICULUM OPTIONS Colleges have also stepped in to implement new strategies for increasing CPA Exam pass rates. In a 2020 report in the Journal of Accounting Education titled “Schools’ CPA review course affiliations and success on the uniform CPA examination,” the authors provided the following three

strategies for how college accounting programs can integrate CPA Exam review courses:

experience applying audit procedures, conducting research and preparing tax returns.

According to “Bridging the CPA Exam Gap: Do Internships Matter?” in the first quarter 2020 issue of the American Journal of Business Education, students completing internships scored higher on all parts of the CPA Exam on average, as shown in Table 1.

The sample size of their findings was small but has practical significance.

Table 1. Internship Comparison — Average CPA Exam Scores CPA CANDIDATES WITH INTERNSHIPS

CPA CANDIDATES WITH NO INTERNSHIPS

DIFFERENCE

y The accounting program can offer the CPA Exam review course for credit either as a required or elective course.

FAR

78.0

74.2

3.8

REG

77.5

74.2

3.3

AUD

81.5

81.3

0.2

y The CPA Exam review courses can be offered as a non-credit course and students can be encouraged to take the course.

BEC

81.6

78.7

2.9

y The CPA Exam review courses can be delivered through continuing education.

Overall, the study found that when CPA Exam review courses were offered as a non-credit course, a higher CPA Exam pass rate was achieved than when students enrolled in a CPA Exam review course on their own.

An alternative strategy is to integrate a CPA Exam review course within a traditional accounting course, which can help motivate students to take the Exam upon graduation.

INTERNSHIPS MATTER Internships have been shown to be a good strategy to help aspiring candidates pass the CPA Exam. These opportunities offer practical application of accounting concepts to support classroom learning and provide emotional intelligence such as leadership, problem solving, communication and interpersonal skills, team building and a strong work ethic. Audit and tax positions can provide students with

The overall conclusion is that students who participate in internships are better prepared for taking the CPA Exam.

Experiential learning infused with academic theory offers a more holistic and wellrounded perspective.

EMPLOYER EFFORTS Employers can also step in to help increase CPA Exam pass rates. While offering salary increases and bonuses provides the motivation to start the journey towards the CPA Exam, it does not provide any strategies to be successful in passing. Firms can go the extra mile by offering CPA Exam coaches to provide study assistance, answer questions and mentor new recruits.

Stockton University is currently working with the NJCPA Atlantic/Cape May Chapter to offer a similar strategy where accounting students will connect with a CPA mentor.

Dr. Barry Palatnik, CPA, Ed.D., MBA, is assistant professor of accounting at Stockton University. He serves as a director for the NJCPA Atlantic/Cape May Chapter and can be reached at barry.palatnik@ stockton.edu. John Boyle, CPA, PA, is assistant professor of business studies at Stockton University.

He can be reached at john.boyle@stockton.edu.

NEW JERSEY CPA | SUMMER 2021

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BUSINESS MANAGEMENT

Mentoring Can Provide Sustainable Benefits

BY JULIE SILARD KANTOR, TWOMENTOR

Mentoring is important in every industry.

While internships and apprenticeships typically teach a trade, mentorship programs have another objective: to give new employees, supervisors and managers the opportunity to learn from seasoned leaders. It also allows for senior leaders to learn from their younger associates.

Mentoring was once considered a “nice to have” program to help supervisors and managers achieve their goals. But it is now considered a “must have” program for all employees in most industries. Mentoring provides the opportunity for everyone in the organization to have a safe space to discuss career goals and objectives while being guided by someone with experience in the area. The role of a mentor is to focus on the professional and personal growth and development of the mentee, develop the mentee’s long-term management and leadership skills, and work with the mentee on critical decision-making skills.

The mentoring relationship can be mutually beneficial to both the mentor and mentee as they inspire, innovate, learn and grow together. Warren Berger, the author of A More Beautiful Question, says that when the world gets more complicated and complex, we need to question more because we must be learning and changing. Berger asserts that we need questioning now more than ever. A mentoring relationship is the perfect place to build one’s capacity to grow as questioner and an active listener.

CREATING A MENTORING CULTURE PGi released a study in 2016 that dove into the millennial mindset. Of the millennials who participated in the survey, 71 percent stated that they wanted meaningful connections at work and hoped to find a “second family” in their coworkers.

Additionally, 75 percent of the millennial respondents viewed mentoring as crucial to their success.

In the same survey, 70 percent of nonmillennials said they are open to reverse mentoring. They acknowledge that 20- and

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30-somethings have more technological knowledge and engage in more innovative practices than their older counterparts.

Generations of employees can, therefore, learn from each other through mentoring.

Most millennials cited “not a good cultural fit” as one of the top reasons why they left their job in the first three years.

To retain this cohort in the workforce, companies need to align their culture to meet the needs of millennials. This should help a multigenerational workforce to have a more meaningful support system and better connections on the job.

MENTORING IS GOOD FOR DIVERSITY AND INCLUSION Mentoring programs are critical to promoting diversity and inclusion efforts.

They can help employees develop a sense of belonging, support traditionally underrepresented groups, increase promotion rates and foster understanding between cultural groups.

A study by Frank Dobbin and Alexandra Kalev at Harvard University analyzed the impact of mentoring, voluntary training, self-managed teams, cross-training, college recruitment, diversity task forces and diversity managers on the representation of African American, Hispanic and Asian men and women at the manager level. The researchers found that mentoring had the largest impact of all strategies, resulting in an increase of representation of minorities at the manager level by 9 to 24 percent.

While many organizations recognize the impact of mentorship on advancing diversity and fostering inclusivity, most rely on informal mentorship. They recommend that employees mentor but do not offer support such as resources, funding, mentor matching and a formal process.

Unfortunately, when many people reach out to mentor informally, they reach out to people in their own likeness. Lean In found that one in six male managers feel uncomfortable mentoring women. Lean In also reported that 60 percent of men in the U.S. are uneasy performing “common workplace activities” alone with a woman.

Formal mentoring programs offer an established, credible and supported way for men to mentor women and minorities.

FORMAL MENTOR PROGRAMS PROVIDE RESULTS Study after study prove that there is no downside to mentoring if the program is well-engineered. Mentors and mentees are more engaged and better positioned for advancement. Engagement equals retention, and retention saves time and money. Across the board, companies that invest in formal workplace mentoring programs experience substantial returns on their investment. DDI World disclosed in its Mentoring Global Leadership Forecast (2018) that 54 percent of organizations in the top third of financial performance have formal mentoring programs, as opposed to 33 percent of organizations in the bottom third.

Julie Silard Kantor is the founder and CEO of Twomentor, a company that offers managed mentoring services and training. She can be reached at 1-833-5mentor or Julie@Twomentor.com.

LEARN MORE On Demand

MENTORING/COACHING ROLE OF THE CONTROLLER/CFO

njcpa.org/events

FINANCIAL PLANNING SERVICES

The Advantages of Individual Equity Portfolios

BY STEPHEN GALLI, CFP®, NISIVOCCIA WEALTH ADVISORS

Many independent financial advisory firms do not offer their clients individual equity (IE) portfolios. Or, if they do, they often outsource IE portfolio management and sacrifice much of their fee. This is mainly because the perceived effort and complexity to create and manage IE portfolios in-house is intimidating.

Common misgivings include the difficulty of researching stocks, the fear of picking poorly performing stocks and the extra work behind managing customized (versus model) portfolios. This creates compelling opportunities for differentiation among advisors that do offer their clients IE portfolio options.

REASONS TO EXPAND Here are five top reasons for firms to expand their portfolio offerings beyond just ETFs and mutual funds: 1. Tax alpha. For firms that are affiliated and/or partnered with tax and accounting professionals, IE portfolios provide the ability to generate tax alpha.

Unlike with funds or ETFs, using IE portfolios allows the advisor to be in control of capital gain/loss generation.

The ability to selectively time and harvest gain/losses can give IE portfolios a tax advantage over fund/ ETF portfolios.

2. Customized portfolios.

Environmental/social/corporate governance (ESG) investing is a trend that is here to stay. If a client wishes to avoid exposure to certain companies, that’s almost impossible to do when just using funds/ETFs. Advisors who can emphasize alternative energy or avoid tobacco products in portfolios will differentiate themselves and achieve deeper relationships with the increasing number of clients that are ESG sensitive. Another advantage of customized portfolios is the ability to be more creative in regard to dividend income generation.

3. Assets under management (AUM) growth and client acquisition.

Independent advisory firms are steadily gaining market share from their larger competition (usually global banks/ investment banks). Quite often, competitor portfolios from large wealth management firms utilize individual equities. If clients are used to owning individual stocks, it is more difficult to attract them unless you also offer IE portfolios.

4. Reverse fee compression. Many advisors are feeling some type of fee compression pressure. As the industry continues to consolidate and get more competitive, larger-scale players can ultimately offer more for less. Advisors who are able to offer IE portfolios and manage them in house will not only instantly see their net fees increase, but can more easily justify existing fee levels because they are providing a more complicated and differentiated product.

5. Better performance. It is important to note that clients who use IE portfolios can enjoy performance advantages over more traditional fund/ETF portfolios.

Unlike funds and ETFs which carry underlying fees generally ranging from 5 to 150bps, individual equities carry no additional underlying management fees.

ADDRESSING COMMON CONCERNS The following are some common objections and misconceptions advisors have about expanding into IE portfolios: y Discomfort with idiosyncratic risk.

This is an unjustified fear as long as the advisor avoids using too few individual stocks in a client portfolio. Portfolio management theory basically states that if a person owns about 20 stocks, they have achieved maximum diversification benefit and can almost eliminate unsystematic risk.

y Unfamiliar with picking stocks. While many advisors hold a CPA, CFP® or other similar designation, very few are a Chartered Financial Analyst (CFA®).

Fortunately, there are many excellent, reasonably priced vendors that advisors can leverage. Additionally, many sales representatives from large asset managers are eager to help advisors analyze and manage IE portfolios, and they also often provide both simple and powerful online analysis tools. y Difficulty with tracking and trading.

Many back-office technology platforms are getting more sophisticated, helping advisors efficiently manage and trade IE portfolios.

IE portfolios are a great way to separate your practice from the competition. I recall meeting an investor in his 60s who told his former advisor to buy transportation and logistics company Federal Express (FDX). The adviser replied, “I’m sorry, but buying individual stock just isn’t something that we do.” Suffice it to say, he’s now my satisfied client.

Stephen Galli, CFP®, is a financial advisor at Nisivoccia Wealth Advisors, a wealth management firm with over $750 million in assets under management. He can be reached at sgalli@ nisivocciawealth.com.

NEW JERSEY CPA | SUMMER 2021

15

FIRM MANAGEMENT

6 Steps to Generate Leads from Social Media

BY BECKY LIVINGSTON, PENHEEL MARKETING

If lead generation is at the top of your firm’s marketing and business goals, you’re going to love this six-step process to turn social media users into leads.

y Early bird rate — get $200 off through [insert date]. y Enter for a free swag bag filled with goodies.

1. BUILD YOUR PROFILES Begin by optimizing your social media profiles by doing the following:

6. MEASURE YOUR SUCCESS To know if your campaign was effective, it must be tracked. In addition to social media analytics, this can also be done with website analytics, such as Google Analytics.

Consider tracking the following:

y List your contact information. y Add a call-to-action button. y Post a link to the firm’s website.

4. PLACE ADS Placing social media ads can be tricky.

Here are some general tips to consider:

2. CREATE CONTENT Create clickable and compelling content that users want to share and comment on.

Here are some ideas:

y Know the target audience — title, interest, age, industry, whatever you can define about them. y Identify the target geography. y Be realistic about the budget. For example, social media ads, on average, cost $0.38 per click with a monthly ad spend between $200 and $1,500. y Use the appropriate image size for each ad platform. Hootsuite (hootsuite.com) offers a social media image cheat sheet for each platform. y Add the pixel (code) provided by the social media platform to your website to help track ad effectiveness. y Maximize the social media platforms’ tools. For example, LinkedIn has built-in lead generation forms; Facebook and Instagram ads can be synced to some customer management systems and they offer re-targeting tools; and YouTube offers prominent call-to-action buttons on lead-generation ads.

y y y y

Downloadable checklists and tip sheets Video how-tos Ebooks, whitepapers and case studies Webinar registrations

How do you know when content is clickable and compelling? If you answer “yes” to any of the following questions, then the content should be behind a lead generation form: y Will the content save the reader time or money? y Will it aid the consumer in learning a new skill? y Does it co-exist with another company/ brand? y Does it explain your product? y Does it provide instruction, e.g., how to?

3. DEVELOP A LANDING PAGE They’ve clicked. Now, wow them with your landing page. Make it easy to read with a simple form. For example, don’t have 12 fields that prospects need to complete to obtain a checklist form. Use more fields when people register for an event, download a case study or want to schedule a consult.

Pre-filled form fields are a bonus for users and increase the chance they will complete the desired action.

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SUMMER 2021 | NEW JERSEY CPA

5. OFFER AN INCENTIVE Give people a reason to do what you want them to do. Offer an incentive that sweetens the deal and makes them want to complete a form, share information, comment or give you a call. Examples include the following: y Get a free, 30-minute consultation. y Register for this webinar and get the second webinar free. y Refer a client and get a one-on-one estate-planning session.

y Conversion rate. Use the following formula to determine how many visitors take the prescribed action: (post conversions / clicks) x 100 y Click-thru rate. Use the following formula to determine the rate of people clicking on your call-to-action (CTA) link: (# of clicks / impressions) x 100 y Bounce rate. Look at your website analytics to determine the percentage of people who leave the page without completing the call to action. y Cost-per-click (CPC). Use the following formula to calculate how much you are paying, per click, for your sponsored social media content for a specified time: Total Ad Spend / Total Measured Clicks y Cost-per-thousand (CPM). Use the following formula to calculate the amount you pay after 1,000 people scroll past (not click) your sponsored content: ($ spent / number of impressions) x 1,000 Now that you have the plan, what can you promote to help create a lead-generation opportunity for your firm?

Becky Livingston is the owner of Penheel Marketing.

She can be reached at becky@penheel.com.

READ MORE CLIENT ACQUISITION ARTICLES AND RESOURCES

njcpa.org/topics/clients

INDUSTRIES

Crypto-Cannabis Collaboration: Implications and Considerations

BY DR. SEAN STEIN SMITH, CPA, LEHMAN COLLEGE AND MELISSA DARDANI, CPA, MD ADVISORY

Adult-use cannabis is now legal in New Jersey. Yet, as of the date of this writing, federal law — specifically the Controlled Substances Act (CSA) — deems cannabis to be an illicit Schedule I Controlled Substance. As a consequence of the legal disparity, the cannabis industry is plagued with issues that make operations expensive and often impractical, including the following: y Banking and payment processing.

In order for a plant-touching cannabis business to accept customer payments, they must either be in cash or supported by an infrastructure of intermediary solutions such as cashless ATMs or ACH payments. These payment processing challenges and banking risks are discussed in a series of NJCPA Focus blog posts at njcpa.org/focus. y Access to capital. While some banks have come around to servicing the traditional banking needs of the industry, traditional lending is simply not an option due to banks’ concerns over their customers’ collateral being subject to federal forfeiture as well as the bank’s Federal Deposit Insurance Corporation (FDIC) insurability. Business owners must grapple with the decision of incurring hefty costs associated with short-term lending options or sacrificing ownership of their business to equity investors.

THE CRYPTO-CANNABIS PARTNERSHIP Blockchain and the use of smart contracts — programmable code embedded into blockchain that helps enable blockchains to communicate and interoperate with other technology systems — can offer a solution. One such application of the smart contract is the stablecoin, which is a type of cryptocurrency whose value is stable with a reserve asset such as the dollar and

that offers potential as a payment processing solution for a cannabis business.

THE CHALLENGES The complications of adopting a cryptopayment method include the following: y Lack of interoperability with businesses not transacting through blockchain. This would require them to maintain a traditional banking option.

Ultimately the business will need to not isolate themselves in their business environment due to lack of compatibility. y Implementation of financial controls.

Additional financial controls might need to be implemented, especially with stablecoins potentially forming the basis of a crypto-based payment system. For example, if an organization chooses to use one specific stablecoin provider, the due diligence that should be performed should mirror that of any fiat-based payment solutions provider. y Interoperability with existing technology tools. How will the mapping and processing occur between crypto exchanges or wallets, the in-house accounting system already in place and potentially converting these stablecoins back into fiat currency?

THE BENEFITS Despite these potential challenges, a collaboration between the cannabis and crypto sectors can deliver several benefits to both sectors. For the cannabis industry, adopting a blockchain and crypto-based payment system can allow cannabis firms, and the cannabis sector at large, to gain better and more consistent access to the U.S. commercial banking system. For the crypto sector, the benefit centers around encouraging more individuals and firms to actually use different cryptocurrencies as a viable medium of exchange.

Cannabis, at the end of the day, is a produce susceptible to spoilage, lowerquality versions and other issues more commonly associated with fresh food sectors. Partnering cannabis and crypto could create an inventory and quality management system that enables blockchain to enter into wider business applications and deliver real, quantitative benefits to the cannabis sector. For CPAs, combining these two high-growth areas creates numerous opportunities.

Disclaimer: Cryptoassets are sophisticated investments that require specialized knowledge.

Please be sure to consult your team of professionals, including CPAs and industry experts, before introducing blockchain-based payment options and operations.

Dr. Sean Stein Smith, CPA, DBA, CMA, CGMA, CFE, is a professor at the City University of New York – Lehman College. He also is the host of the NJCPA TechTalk Podcast (njcpa.org/techtalk). He can be reached at drseansteinsmith@gmail.com.

Melissa Dardani, CPA, MAcc, is the founder of MD Advisory, a boutique forensic firm. She is the leader of the NJCPA Cannabis Interest Group. She can be reached at melissa.dardani@mdas.cpa.

LEARN MORE Aug. 5, Live Webcast

CANNABIS CONFERENCE

Oct. 27, Live Webcast

EMERGING TECHNOLOGIES CONFERENCE

njcpa.org/events

DO MORE JOIN THE CANNABIS AND/OR EMERGING TECHNOLOGIES INTEREST GROUPS

njcpa.org/groups

NEW JERSEY CPA | SUMMER 2021

17

PROFESSIONAL DEVELOPMENT

Top 5 Excel Skills for Entry-Level Staff

BY BRIGID D’SOUZA, CPA, SAINT PETER’S UNIVERSITY

Entry-level staff will be well served by building their Excel toolkit early. The list below is largely gleaned from my experience working for a Big 4 tax firm in a quantitative consulting practice, but also from weaving Excel into my advanced accounting classes at Saint Peter’s University.

1. FORMAT YOUR DATA Formatting your data to be as easily readable as possible will create efficiencies down the line as work prepared by entrylevel staff is analyzed or manipulated by more senior staff. Some key tasks to keep in mind include the following: y Wrapping data within cells to ensure data is not cut off y Shading and centering header cells y Adding lines and borders to differentiate subtotals and totals from details Excel’s formatting menus have a similar interface as Word, making it one of the easier tasks to latch onto if you’re just starting out with Excel.

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SUMMER 2021 | NEW JERSEY CPA

2. MASTER KEYBOARD SHORTCUTS Large spreadsheets can be intimidating at first glance, but figuring out how to quickly and efficiently move around in a spreadsheet will help build both your efficiencies and your confidence level. The “command” key on a Mac or “control” key in Windows will, when combined with arrow keys, allow you to jump up and down vertical ranges or left to right across horizontal ranges. Layering in the “shift” key allows you to highlight the cells as you jump, which can be helpful if you want to apply a singular change (such as bolding) to the entire range.

3. CLEAN YOUR DATA Examples of cleaning data include replacing blank cells with zeros, ensuring all values in a single column are formatted consistently or getting rid of unnecessary leading spaces in a text value. Excel can help automate a lot of this. The following are two examples: y The TRANSPOSE formula allows you to copy a range of cells that is laid out horizontally or vertically and then paste the range vertically or horizontally, respectively.

y The TRIM formula will remove any leading or trailing blank spaces before or after a value in a cell.

4. VALIDATE YOUR CHANGES After you’ve cleaned your data, it is a good practice to validate that your changes have not altered the raw (or original) dataset.

Excel is chock full of formulas to help with this, including the following: y The SUM formula can report back totals for columnar data which you can then compare to control numbers in the enterprise-wide (original) reports. y The COUNTA formula can count the number of data points within a range which can be a helpful check to make sure no rows or data points were erroneously deleted while you were data cleaning. y The SUMIF and COUNTIF formulas will allow you to sum or count (respectively) a range based on a conditional value. For instance, “sum all revenues from Country X” or “count all instances of Country Y.”

PROFESSIONAL DEVELOPMENT

5. ANALYZE AND VISUALIZE YOUR DATA Once you have a clean dataset and you’ve run diagnostics to ensure your changes have not resulted in inaccuracies or omissions, you’re ready to analyze, visualize and report back to your team. Entry-level staff should learn the VLOOKUP and PIVOT table concepts. While these are advanced skills in Excel, every entry-level employee can learn them.

y PIVOT TABLES are customizable reports within Excel. Pivot tables require clean data, which is why the preceding skills are so important. After that, it’s a matter of using Excel’s menu options to create the table.

y The VLOOKUP formula is a search feature — like the Amazon or Netflix search box — that you can run on your dataset. Let’s say you have a list of unique customers and you want to easily pull up profile data on that customer based on the customer name.

VLOOKUP allows you to use the customer name as a search term, the full customer dataset can be your lookup range and VLOOKUP will report back the profile fields associated with that customer.

Brigid D’Souza, CPA, MBA, is assistant professor at the Frank J. Guarini School of Business in the Department of Accountancy & Business Law at Saint Peter’s University. She is a member of the NJCPA and can be reached at bdsouza@saintpeters.edu.

If you’re already in an entry-level staff position or about to begin one, take the time to learn these skills as they will make you more efficient over time.

LEARN MORE

EXCEL FOR ACCOUNTING PROFESSIONALS:

June 7 or Sept. 20

SESSION 1: TABLES AND NAMED REFERENCES

June 8 or Sept. 21

SESSION 2: DATA VALIDATION AND CONDITIONAL FORMATTING

June 9 or Sept. 22

SESSION 3: WORKING DESIGN PRINCIPLES AND ORGANIZATION

June 10 or Sept. 23

SESSION 4: CONDITIONAL SUMMING AND LOOKUPS

June 11 or Sept. 24

SESSION 5: ERROR TRAPPING AND IMPROVING LOOKUPS

June 14 or Sept. 27

SESSION 6: LIST COMPARISONS AND INDENTING

June 15 or Sept. 28

SESSION 7: DATE-DRIVEN WORKBOOKS AND CONCATENATION

June 16 or Sept. 29

SESSION 8: DYNAMIC HEADERS, MAPPING TABLES AND ERROR CHECK

njcpa.org/events

NEW JERSEY CPA | SUMMER 2021

19

RISK & COMPLIANCE

Do You Really Need a Cyber Insurance Policy?

BY DR. JOSEPH HOWE, CPA

You walk into work in the morning and boot up your computer to find a message that your network has been taken hostage.

The captors say you need to pay them bitcoin within the next 24 hours or else.

When the operation and finance of your business hangs in the balance, this can be a nerve-racking experience, especially if you have never faced it before.

You followed the advice on what to do to secure your network, but the worst has still happened — so what now?

Hopefully, as part of your technology risk management plan, you have purchased cyber liability insurance.

BENEFITS OF CYBER LIABILITY COVERAGE You probably already have property and casualty insurance to cover against theft, but it likely excludes incidence of cyber-attack. Cyber liability is a highly specialized area of insurance that has grown substantially over the years along with the rise in incidence of cyber-crime.

When you’ve secured this specialized coverage, your first step when faced with a breach is to contact the carrier and activate their response services. When purchasing a policy, it should clearly delineate what this response will be including the timing, nature and extent of services provided. A policy should include, at a minimum, a 24-hour response by forensic computer specialists 365 days a year.

Do you have experience negotiating with terrorists? I didn’t think so. But these response firms do. Surprisingly, the first approach may be to evaluate the threat and then negotiate with the attacker and facilitate payment of the ransom. Your policy may even cover paying the ransom up to a certain amount.

As you can imagine, cyberattack response experts do not come cheap; some of their rates would make law firm partners blush. Here again, your policy will cover up to a certain amount of services. Most importantly you want your business up and running normally again.

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SUMMER 2021 | NEW JERSEY CPA

SHOPPING FOR A POLICY When shopping for a cyber insurance policy, you should evaluate the following features and costs: y System restoration and data recovery.

Evaluate the amount of coverage provided for system restoration and data recovery and compare it to the norm for your industry. If a server needs to be taken down because of the incident, the policy may include “bricking” coverage to pay for the replacement cost. y Dependent systems coverage.

While a cyber liability policy can cover business interruption losses because of the incident, a notable variant of this is dependent systems coverage. Your business likely relies on other businesses for software as a service and/or cloud storage.

Dependent systems coverage covers business interruption that results from a breach or failure of these third-party systems. y Breach notification. When your systems have been breached, you may have a duty to inform certain people whose personally identifiable information has been compromised.

Aside from covering legal fees, policies commonly cover costs associated with making the notification including mailing, setting up a toll-free number for information services and providing credit monitoring services to those affected. y Public relations. Depending on the publicity that may result from the incident, retaining a public relations firm to help manage the crisis may also be covered. y Legal defense. More robust coverage will also cover defense of legal claims arising from the data breach.

By and large, when buying insurance, you are buying peace of mind. Even the most advanced technology systems are susceptible to attack, so don’t be disillusioned that your own systems are somehow impenetrable. Most good insurance companies will provide you with an evaluation of the resiliency of your technology infrastructure and guidance on steps you can take to prevent cyberattacks.

Dr. Joseph Howe, CPA, CFE, CGFM, is the chief financial officer of a government entity in New Jersey. He is a member of the NJCPA Governmental Accounting & Auditing Interest Group and can be reached at jhowecpa@gmail.com.

DO MORE

SAVE ON CYBER INSURANCE

WITH NJCPA PARTNER GALLAGHER AFFINITY

njcpa.org/benefits

LEARN MORE June 7, June 20, July 7 or Aug. 4, Live Webcast

KEY CYBERSECURITY CONTROLS FOR CPAs

njcpa.org/events

TAX

2012 Estate Tax Planning Redux: Everyone Gets a SLAT

BY ADAM L. SANDLER, ESQ., EINHORN, BARBARITO, FROST & BOTWINICK, PC

The COVID-19 pandemic has resulted in historically low interest rates, depressed values of certain assets and a need for increased federal revenue. When combined with the shift of power in Washington, this becomes a critical and advantageous time for clients to refocus on estate tax planning.

The Tax Cuts and Jobs Act of 2017 (TCJA) increased the federal estate and gift tax exemption from $5 million to $10 million, indexed for inflation. In 2021, that exemption is $11.7 million per person.

Factoring in “portability” (the ability for a married couple to share in each other’s unused exemption), a married couple can currently pass up to $23.4 million without such amount being subject to federal estate and gift tax. The individual exemption is scheduled to increase annually with inflation and then return to its pre-TCJA level of $5 million on Jan. 1, 2026 (approximately $6.5 million when adjusted for inflation).

However, a reduction in the exemption may happen even sooner and potentially by the end of 2021. President Biden’s initial tax plan sought to reduce the estate tax exemption to $3.5 million per person, decouple the gift tax exemption at $1 million per person and increase the estate and gift tax rate from 40 percent to 45 percent. His American Families Plan does not call for those changes but seeks to abolish the basis adjustment (“step-up”) for assets included in a decedent’s estate under IRC§ 1014 and possibly institute an automatic realization of capital gains at death.

With the potential changes coming out of Washington, it is time to revisit estate tax mitigation strategies with clients who

may have been pushing it off until closer to 2026, as well as those who would be affected under the Biden plan, if enacted.

Clients should be thinking about capturing their unused exemption before it disappears and removing appreciating from their taxable estate.

STRATEGIES FOR CLIENTS Telling clients to gift away their assets now to future generations is not always well received. After all, the client will not be around to benefit from any estate tax savings. When taxpayers faced a potential reduction of the exemption in 2012 from $5.12 million to $1 million, a popular vehicle emerged to enable them to capture the increased exemption while retaining “access” to the transferred assets — a Spousal Lifetime Access Trust (SLAT).

A SLAT is an irrevocable trust established for the benefit of the grantor’s (aka settlor’s) spouse, which may also include the grantor’s descendants as discretionary beneficiaries.

Once the grantor transfers assets to the SLAT, the grantor no longer owns those assets for estate tax purposes thereby losing his or her rights to enjoy them. However, because the SLAT is established for the benefit of the grantor’s spouse, the spouse will have “access” to the trust assets. To the extent the spouse receives a distribution from the SLAT, the grantor may inadvertently benefit through the spouse’s use or enjoyment of such distribution.

For clients who are unwilling to gift away assets or are concerned about the potential that any reduction of the exemption could be made retroactive to

Jan. 1, 2021, tried and true “estate freeze” strategies would assist clients in removing the appreciation of their assets from the estate without gifting away the underlying assets. Because SLATs are typically structured as “grantor trusts,” there should be no gain or loss recognized if the grantor sells an asset to the SLAT because the grantor is treated as the owner of the trust assets for income tax purposes under the grantor trust rules set forth under IRC § 671, et seq. This is what is commonly referred to as a sale to an Intentionally Defective Grantor Trust (IDGT).

The strategy is quite simple: the grantor would sell an interest in certain assets to a SLAT in exchange for payment of the assets’ fair market value. Instead of receiving cash, however, the grantor would receive a promissory note. This has the effect of “freezing” the value of the property included in the grantor’s estate to the face amount of the promissory note, plus the annual interest charged thereon. Interest would be imposed at the Applicable Federal Rate (AFR) as of the date of the sale. All of the income and appreciation of the assets in excess of the original value of the note, and interest charged thereon, would be captured in the trust and, thus, pass to the client’s intended beneficiaries with no estate and gift tax assessed on such income and appreciation.

Disclaimer: The potential passage of two Acts introduced in the Senate — For The 99.5% Act, introduced by Senator Sanders, and the Sensible Taxation and Equity Promotion (STEP) Act, introduced by Senators Van Hollen, Booker, Whitehouse, Warren and Sanders — could impact this type of planning.

Adam L. Sandler, Esq. is an associate at Einhorn, Barbarito, Frost, & Botwinick, PC, specializing in wills, trusts and estates and taxation. He can be reached at asandler@einhornlawyers.com.

NEW JERSEY CPA | SUMMER 2021

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TECHNOLOGY

The Latest Trends in Blockchain and Crypto

BY DR. SEAN STEIN SMITH, CPA, CITY UNIVERSITY OF NEW YORK — LEHMAN COLLEGE

Specific questions to ask include the following: y What crypto wallet (storage) applications are being considered and potentially implemented by the organization? y Has the insurance for the organization been updated or modified to account for the potential risk of hacks or other cybersecurity issues linked to blockchain and cryptoassets?

STABLECOINS Can the profession successfully navigate the potential complications that can, and do, arise from cryptoasset accounting for instruments such a stablecoins? Some additional issues that stablecoins create include the following:

The blockchain and cryptoasset landscape continues to accelerate and evolve in ways that just a short time ago would have seemed radical or outlandish. Below are some recent developments and what they might mean for practitioners moving forward.

CRYPTO PAYMENTS ARE HERE Following the clarifications by the Office of the Comptroller of the Currency (OCC) allowing federally chartered banking institutions to buy, sell and approve certain crypto transactions, the trend is clear. In addition to these announcements, multiple banking charters have been granted to digital asset institutions. The takeaway is that clients will be dealing with crypto payment issues, and CPAs need to know what to ask, how to ask and how to interpret the answers received. Other issues include the following: y Specific industries, such as the stillnascent cannabis industry, can benefit

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SUMMER 2021 | NEW JERSEY CPA

dramatically from the integration and implementation of blockchain and crypto asset solutions, as documented in the article on page 17 of this publication. y Cost savings and other operational opportunities regarding near-real-time reporting and reducing the need for manual confirmations are going to increasingly move from concept to reality; are practitioners prepared for these adjustments?

NEW ITERATIONS OF CRYPTO ARE HERE Stablecoins, digital twins connected to blockchain and the potential rise of the nonfungible token (NFT) sector all represent new iterations of blockchain that need to be understood, assessed and integrated into business operations. Depending on the client, an increasing percentage of assets, revenues and operations might be taking place in a purely digital or even crypto environment.

y From a practitioner perspective, what are the broader implications of clients, both now and in the future, beginning to accept crypto payments as an integrated part of business operations? y From a cybersecurity standpoint, are clients and practitioners going to be up to speed with regard to dealing with an increasing amount of digital payments?

ACCOUNTING OPEN ITEMS There are still a significant number of accounting-related open items that need to be addressed in order to generate wider adoption and utilization, including the following: y Are clients aware of tax obligations related to crypto? y Do clients properly disclose cryptorelated information to regulators, most notably the IRS, in the correct manner? y Is there a process in place at the organization to correctly value and report updated values of crypto holdings as they change?

TECHNOLOGY

CYBER RISK Cybersecurity and other technology controls and considerations also need to be brought to the front burner. Practitioners need to pay special attention to the following issues: y If crypto payments are accepted, what controls exist over the interoperability between new crypto-specific applications and legacy systems? y Are the cybersecurity policies inside the organization (e.g., internal controls) updated and inclusive of blockchain and crypto-specific issues?

DECENTRALIZATION OF FINANCE (DEFI) In the last year or so, the concepts of decentralized finance and decentralized exchanges have raced ahead. Doing a deep dive on these concepts is beyond the scope of any single piece, but the tax and accounting implications of concepts like block rewards, liquidity mining, yield arming and other DeFi-native applications

are going to continue to raise complicated questions for the foreseeable future.

NON-FUNGIBLE TOKENS The race toward new cryptoasset applications and developments continues unabated, with the recent rise of non-fungible tokens (NFTs) representing just the most recent iteration. Highlighted by digital collectibles and potential video game monetization opportunities, NFTs have tremendous potential. A working definition of this new cryptoasset can be put together as follows: NFTs are a unique and indivisible digital asset that 1) are connected to an underlyingblockchain, 2) are unique and cannot be exchanged for one another as equivalents (versus dollars or bitcoin) and 3) are linked to a specific asset.

Clearly, the blockchain and cryptoasset sectors continue to develop and evolve at a rapid rate, and alongside this rapid development and expansion are going to be accounting and reporting issues that need to be addressed.

These might seem like significant challenges, but they also create quite a few opportunities for motivated and proactive practitioners.

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Dr. Sean Stein Smith, CPA, DBA, CMA, CGMA, CFE, is a professor at the City University of New York — Lehman College. He also is the the host of the NJCPA TechTalk Podcast (njcpa.org/techtalk).

He can be reached at drseansteinsmith@gmail.com.

LEARN MORE June 15, July 12 or Aug. 10, Live Webcast BLOCKCHAIN TECHNOLOGY: WHAT EVERY CPA SHOULD KNOW

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NEW JERSEY CPA | SUMMER 2021

23

NJCPA NEWS

2021/22 NJCPA Leaders The following NJCPA members are serving as officers, trustees, chapter presidents, committee chairs and interest group leaders from June 1, 2021, through May 31, 2022.

EXECUTIVE COMMITTEE

PRESIDENT

PRESIDENT-ELECT

SECRETARY

HARRY P. WILLS III, CPA, CGMA Bowman & Company LLP

KATHEEN F. POWERS, CPA

JORDAN D. AMIN, CPA, MST

Matheny Medical and Educational Center

EisnerAmper LLP

TREASURER

IMMEDIATE PAST PRESIDENT

CEO & EXECUTIVE DIRECTOR

JUNE TOTH, CPA, CFF, CITP, CGMA

ALAN D. SOBEL, CPA, CGMA

RALPH ALBERT THOMAS, CPA (DC), CGMA

ZBT Certified Public Accounting & Consulting, LLC

SobelCo

NJCPA

To learn more about our Executive Committee, visit njcpa.org/about/board.

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SUMMER 2021 | NEW JERSEY CPA

NJCPA NEWS

BOARD OF TRUSTEES

DENNIS BARTLETT, CPA

ISABEL DEL CORRAL, CPA

JoANNE GEYLIN, CPA

JESSE M. HERSCHBEIN, CPA, CGMA

Cullari Carrico LLC

McIntee Fusaro Del Corral, LLC

EisnerAmper LLP

PragerMetis CPAs, LLC

NOORUS KHAN, CPA

JASON LAURETTA, CPA

ALTHEIA LEDUC, CPA

CHRISTOPHER LOVASZ, CPA

Smolin, Lupin & Co., P.A.

ADP

Gold Gerstein Group LLC

Deloitte

BRIAN NAFASH, CPA

MICHAEL A. STILLITANO, CPA

CHRISTOPHER STOOP, CPA

KATHERINE ZECH, CPA

Massood & Company, P.A.

National Retail Systems

EisnerAmper LLP

PKF O’Connor Davies, LLP

NEW JERSEY CPA | SUMMER 2021

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NJCPA NEWS

CHAPTER PRESIDENTS

INTEREST GROUP LEADERS/COMMITTEE CHAIRS

ATLANTIC/CAPE MAY Tatiana Safrygina, CPA Capaldi Reynolds & Pelosi CPAs, P.A.

Accounting & Auditing Standards Interest Group Laura Crowley, CPA, MBA Critrin Cooperman & Company, LLP

BERGEN Michele Theuerkauf, CPA Michele Theuerkauf, CPA LLC ESSEX Joseph Zapf, CPA SobelCo HUDSON Michael Lamela, CPA Michael Lamela CPA, LLC MERCER Stephen M. Noon, CPA Mercadien Group MIDDLESEX/SOMERSET Kevin Fellin, CPA Kevin Fellin, CPA LLC MONMOUTH/OCEAN Amber Papp, CPA Bare Necessities MORRIS/SUSSEX Peter E. Herbst, CPA Parsippany Tax and Accounting Corp.

PASSAIC COUNTY Rudy Ipekcian, CPA BDO USA, LLP SOUTHWEST JERSEY Anthony C. Plakis Jr., CPA ADP UNION COUNTY Jonathon Westcott, CPA Michael Lamela CPA, LLC Learn more about our chapter presidents and the activities taking place in their chapters at njcpa.org/chapters.

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SUMMER 2021 | NEW JERSEY CPA

Emerging Technologies Interest Group Mark Eckerle, CPA WithumSmith+Brown

Professional Conduct Committee Lori West, CPA Grant Thornton LLP

Audit Committee Brian Collins, CPA Baker Tilly

Federal Taxation Interest Group Benjamin Aspir, CPA EisnerAmper LLP

Retirement Savings Plan Committee Harry P. Wills III, CPA, CGMA Bowman & Company, LLP

Business & Industry Professionals Interest Group Christopher Schiffer, CPA, CFP, MBA, AIF Wealth Enhancement Group

Finance Committee June Toth, CPA, CFF, CITP, CGMA ZBT Certified Public Accounting & Consulting, LLC

Cannabis Interest Group Melissa Dardani, CPA, MAcc MD Advisory

Governmental Accounting & Auditing Interest Group John Swisher, CPA Suplee, Clooney & Company

Chapter Operations Committee Christine Darcy, CPA Darcy & Company CPAs, LLC

Investment Committee Bryan Koslow, CPA/PFS, MBA, CFP, CFF Clarus Group LLC

Committee Operations Committee Elizabeth Harper, CPA SobelCo Education Foundation Executive Committee Brad Muniz, CPA SobelCo

State Taxation Interest Group Michele Vetlov, CPA Dassault Falcon Jet Corp Strategic Planning Committee Karl Halteman, CPA, CGMA ReSource Pro Student Programs & Scholarships Committee Thomas Pedersen, CPA

NJCPA-CPA-PAC Shawn Scutellaro, CPA CohnReznick LLP

Volunteer Relations Committee Amy Both, CPA WithumSmith+Brown

NJCPA Scholarship Fund Henrietta Fuchs, CPA CohnReznick LLP

Learn more and join interest groups at njcpa.org/ groups.

Nominating Committee Kyle Sell, CPA, MBA Deloitte

Emerging Leaders Council Nicole DeRosa, CPA, MAcc Wiss & Company, LLP

Nonprofit Interest Group Patricia Linsley, CPA Neral & Company, P.A.

Emerging Leaders Interest Group Nicole DeRosa, CPA, MAcc Wiss & Company, LLP

Peer Review Executive Committee Frank Boutillette, CPA, CGMA, ABV WithumSmith+Brown

NJCPA NEWS

NJCPA Virtual Convention to Drive the Profession Forward The 2021 NJCPA Virtual Convention, June 15-18, will bring CPAs together to face the changing dynamics of the accounting profession. Attendees will find out what trends are needed to move the profession forward, how to advance their career amid changing skillsets and what new technological innovations are breaking new ground and making jobs more efficient — in short, how to accelerate change. After a cancelled convention in 2020 due to the COVID-19 pandemic, the NJCPA is back virtually this year with hot topics, innovative ideas and practical approaches.

The event’s five keynote speakers include the following: y Barry C. Melancon, CPA, CGMA, CEO of the Association of International Certified Professional Accountants and president and CEO at the American Institute of CPAs (AICPA), who will focus on delivering value during uncertainty y James C. Bourke, CPA, CITP, CFF, CGMA, partner and managing director of WithumSmith+Brown’s advisory services practice, who will address technology disruption and a profession-wide shift to business advisory as key transformations in the industry

y Luke Williams, executive director of the W.R. Berkley Innovation Lab at NYU, who will explain why businesses need to be consistently making bold moves y Marc Staut, a shareholder and chief innovation and technology officer at Boomer Consulting, Inc., who will explain how to create a culture of innovation at businesses y Amanda Wilkie, PMP, a consultant at Boomer Consulting, Inc., who will delve into effective processes to improve efficiency The event will open with an IssuesWatch panel covering the key state and national topics affecting CPAs. Other sessions will explore lease accounting, recognizing state and local tax (SALT) deductions in the wake of telecommuting, cybersecurity, technological innovations, leadership solutions, remote auditing and keeping current on tax matters. A business and economic roundtable will conclude the four-day event.

A full slate of virtual entertainment will also be offered including a Family Feud-style game show called Virtual Survey Says that allows Convention attendees to compete against other accounting

professionals; an interactive mind-reading show hosted by Colin Cloud, noted cyber mentalist and finalist on America’s Got Talent; a trivia happy hour hosted by the NJCPA Emerging Leaders Council; and a chapter social event that includes fun activities in different Zoom breakout rooms. Participants can also enter and log their athletic prowess via a virtual run/ walk/bike race challenge.

The generous support of the following sponsors allows the NJCPA to offer a low registration fee for 20-plus CPE credits: ADP (Premier Sponsor)

Paychex

Balance Point

PCS

Bank of Ameirca

Plymouth Rock

CAMICO/Gallagher

PNC

Columbia Bank

Provident Bank

Guaranteed Rate

QuickFee

Investors Bank

SMI/Calltower

JPMorgan Chase & Co.

USI Affinity

LeaseQuery

Wells Fargo

Merchant Advocate

Whitman Business Advisors

M&T Bank

Xero

Learn more and register at njcpa.org/ convention.

In Memoriam The NJCPA is saddened to announce the passing of Paul Ruopp, CPA, who served as president of the NJCPA in 1981/82. Paul, who passed away on Feb. 22, 2021, served on numerous committees during his time at the Society and is particularly remembered for his leadership in the Union County Chapter, where he was a former president and held other leadership positions.

Paul retired from KPMG (formerly KPMG Pete Marwick) after 25 years as a partner and later founded Paul W. Ruopp, CPA, where he was still active doing tax returns and taking professional development courses until last fall.

He is survived by his children, Paula, Andrew and his wife, Susanne, Joshua and his wife, Christine, nine grandchildren and two great grandchildren as well as two brothers, Ronald and John.

“It’s always disheartening to hear about the passing of one of our leaders. We are grateful for all of his participation throughout the years,” said Ralph Albert Thomas, CPA (DC), CGMA, CEO and executive director of the NJCPA.

NEW JERSEY CPA | SUMMER 2021

27

NJCPA NEWS

30 Under 30: Then and Now 2011

Ten years ago, we named a group of young NJCPA members to our inaugural “30 Under 30” list in recognition of their leadership, success and drive. We recently checked in with them to see what they’ve been up to since 2011. In this second in a series of updates, here are six members who continue to inspire us today. See the first five updates in the spring 2021 issue of New Jersey CPA, and look for more updates in upcoming issues.

JERILYN ANGOTTI, CPA Controller at Studio Hillier Jerilyn’s career path represents the epitome of drive — from once interning at Studio Hillier to returning as controller, responsible for the operations of the architecture practice and real estate development as well as the property management functions of all Hillier companies. Giving back has provided valuable lessons for her; she currently serves as president of her homeowner’s association and treasurer of the National Alliance on Mental Illness (NAMI) Mercer.

CHRIS COWAN, CPA, CCIFP Senior manager at CohnReznick LLP At an early age, Chris was recognized for outstanding contributions to the accounting profession — having been awarded NJBIZ’s “40 Under 40” award and the NJCPA’s Impact award.

He credits the relationships he has made with clients, colleagues, mentors and professors as a main contributor to his career growth and says the NJCPA has been a great source of educational content and networking opportunities.

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SUMMER 2021 | NEW JERSEY CPA

DONNA FLERES, CPA Senior manager at EisnerAmper LLP Donna leads by example — both inside and outside her firm. Over the past 10 years, she has been active in NJCPA interest groups and student volunteer work as well as the Cares Committee, Staff Audit Committee, Women of EisnerAmper Steering Committee and the New Jersey real estate group at EisnerAmper, eventually becoming firm-wide real estate web liaison.

Looking back, she would have taken more advantage of the changing pace of technology.

NOORUS KHAN, CPA Member of the firm at Smolin Leadership comes naturally to Noorus, who over the past 10 years graduated from Smolin’s Emerging Leaders Academy, became a partner and

helped lead a financial turnaround at her local chamber of commerce. She has also held various leadership roles at the NJCPA, including president of the Essex Chapter, and is currently serving as a Trustee. She reminds those just starting out to not be afraid to speak up and have a serviceoriented mindset.

MICHAEL LEVY, CIA, CRMA, MBA, CISA, CISSP Director of finance and internal audit at Student Transportation of America Always an innovator, Michael built an internal audit function at his organization, focusing on assurance, advisory and process improvement. He was selected to be a member of the Institute of Internal Auditors’ North American Board of Directors and recently coauthored a textbook on internal auditing. Looking back, he would advise others to spend more time outside of their comfort zone and learn more programming.

NJCPA NEWS

JOSEPH A. McGRATH JR., CPA Audit and assurance partner at Deloitte & Touch LLP

In his 16 years at Deloitte, Joe has made a mark for himself in the accounting profession. Being promoted to audit and assurance partner was a career-defining accomplishment — one he had set his sights on when he was named one of NJCPA’s “30 Under 30” award winners.

He has realized that finding a great mentor and being a great mentor can make all the difference in one’s career.

NJCPA Awards Scholarships Furthering its commitment to support accounting education, the NJCPA Scholarship Fund awarded approximately $230,000 in scholarships in March to 45 New Jersey high school and college students. The awards were distributed by mail in the absence of a ceremony this year because of COVID-19-related concerns.

Out of a total of more than 160 applications, 13 college-bound high school seniors were awarded $1,500 each and 32 college students were awarded $6,500 each.

Scholarships are awarded based on academic performance, standardized test scores, essays and personal interviews.

Those applying for the high school award had to be seniors who intend to major in accounting, while the college applicants had to be New Jersey college students who are currently in their junior year or in their senior year and entering an accounting-

related graduate program. In addition, five awards on behalf of the American Institute of CPAs/National Association of Black Accountants were distributed as well as several awards in honor of a particular person or company.

“We are especially pleased with the generosity this year by our members in making donations to the Scholarship Fund amid an uncertain economy and a challenging business climate. This program would not be possible without the generous support of our members, chapters and firm/company benefactors,” said Ralph Albert Thomas, CPA (DC), CGMA, CEO and executive director of the NJCPA. This year's firm/company benefactors include the following: y Bowman & Company LLP y CohnReznick LLP

y EisnerAmper y Frazer, Evangelista & Company, LLC y Mazars USA LLP y Smolin, Lupin & Co., P.A. y Untracht Early LLC y WilkinGuttenplan y WithumSmith+Brown “The scholarships are a great way to encourage young professionals to pursue a career in accounting and to assist them with some of the financial burdens in getting there,” said Chris Lovasz, CPA, president of the NJCPA Scholarship Fund and managing director at Deloitte & Touche LLP. “Giving back to the next generation of CPAs is extremely rewarding.”

For a complete list of the winners, visit njcpa.org/scholarships.

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29

NJCPA NEWS

NJCPA Tax Call-In a Success NJCPA’s annual Tax Call-In with the Asbury Park Press went off without a hitch on March 7 as callers logged in both virtually and by phone to get free income tax advice from member CPAs. Virtually from their homes or offices, NJCPA member volunteers fielded 121 calls during the four-hour period — averaging a call every two minutes.

With the COVID-19 pandemic significantly impacting New Jersey residents and businesses, it was no surprise that the bulk of the calls concerned tax implications from stimulus payments, unemployment benefits and filing taxes returns as taxpayers predominantly worked remotely. Callers also inquired about estate taxes, the taxability of social security and the suspension of required minimum distributions (RMDs).

“Every taxpayer who I spoke to was extremely grateful for the opportunity to talk to a tax professional. While most

questions varied, every taxpayer asked about stimulus payments at some point during our conversations,” explained NJCPA member volunteer Christopher R. Cicalese, CPA, MSTFP, a manager at Alloy Silverstein Accountants and Advisors.

The volunteers also benefited from the experience. As member volunteer Rachel Efthemes, CPA, a senior tax manager at Mazars USA LLP, said, “I had a lot of interesting questions, and all of the callers were extremely appreciative. They repeatedly thanked me for the help, and I enjoyed making a difference to them.”

June M. Toth, CPA, CFF, CITP, CGMA, managing member at zbt Certified Public Accounting & Consulting, LLC, agreed. “It was rewarding to give back to the community and participate with other members of the Society. The callers expressed appreciation, and it was a positive experience to alleviate some of their anxiety.”

The NJCPA is grateful to the following NJCPA member volunteers who donated their time: y Christopher Cicalese, CPA — Alloy Silverstein y Melanie Cobb, CPA — Abacus Financial LLC y Nicole DeRosa, CPA — Wiss & Company, LLP y Rachel Efthemes, CPA — Mazars USA LLP y Olga Lubomirsky, CPA — Mazars USA LLP y Justin Lynch, CPA — WithumSmith+Brown y June Toth, CPA — zbt Certified Public Accounting & Consulting, LLC Members who want to volunteer at next year’s tax session can sign up at njcpa.org/volunteer.

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SUMMER 2021 | NEW JERSEY CPA

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CLASSIFIEDS

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PROFESSIONAL SERVICES

Quality Review for CPA firms: audit, review, compilation, employee benefit plans, Yellow Book, revenue ecognition. Contact James M. Sausmer, CPA at 732-261-7710 or james.sausmer@ gmail.com.

MERGERS/ACQUISITIONS

Accounting Practice Exchange, the online marketplace dedicated exclusively to the purchase, sale and merger of CPA and accounting practices across the USA. View opportunities here: www.accountingpracticeexchange.com.

First Choice Business Brokers has the utmost experience, scale, integrity and commitment in successful sales and acquisitions of businesses. It’s why Inc.com rates the company #3 on their list of “Top Boutique Brokers.” I’m Gregory J. Carafello, principal broker, and for 39 years, I’ve owned and operated businesses in NY/NJ. Please contact me to discuss how I can assist you and your clients with business transition needs at 973-632-2192 or gcarafello@fcbb.com.

Whitman Business Advisors www.whitmanbiz.com has been helping CPA firms with their M&A needs since 2008. We are working with several non-NJ headquartered firms that are looking for a foundational firm to expand their foot-print into NJ. If your revenues exceed $3MM annually then we should talk today!

To confidentially discuss this opportunity, please email us at pw@whitmanbiz.com.

Matthews, Panariello P.C., a well established full service Bergen County firm located in Paramus, is looking to acquire firms, sole practitioners, or accounts (audits, reviews, and tax preparation) ranging in size from $100,000 to $750,000. We are a peer reviewed firm with a strong track record of client satisfaction and retention. We have been successful in prior acquisitions; let’s talk. Please visit our website at www.mpcpas.com. To confidentially discuss this opportunity, email Peter at pmanetta@mpcpas.com.

New Jersey practices for sale: gross revenues shown: Bordentown, NJ CPA, $220K and Gloucester Co. CPA, $615K. Available after 4/15/2021, Toms River metro area CPA, $690K and southern Middlesex Co. CPA, $1.075M. For more information, call 800-397-0249 or visit www.aps.net.

Union County CPA looking for a CPA to take over my firm. Gross 300K. Reply to smocoo4954@aol.com.

Mercer County Audit practice for sale.

Retirement-minded sole practitioner grosses $100,000 in audit, review, and compilation fees. Financing available. He will retain the tax and write up clients for a few more years. For more information, email buymymerceraudits@yahoo.com.

Unlimited Risk Advisors LLC. We're CPAs that help other CPAs and their clients address their Health, Life, Disability, Long-Term Care, and Medicare Insurance needs! We provide individual policies and work with any size organization to develop and implement best-in-class group benefit plans. For additional information, please give us a call at 732-510-5670 or email us at info@ unlimited-financial.com.

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MEMBER STORY

before I ever got to the teaching side of the equation,” says Ed. “As a CPA you have to be used to that. Take whatever is in front of you — however messy, mixed up and crazy it may be — clients still need to have something explained to them today. It helps dramatically to anticipate where the questions and problems are going to come from,” he adds. And it helps to do your homework. “Clients in Arizona know things about California. That’s why New Jersey practitioners better have some knowledge of what’s happening in New York.”

All in a Very Long Day’s Work

BY KATHLEEN HOFFELDER, NJCPA SENIOR CONTENT EDITOR

CPAs routinely ask Edward K. Zollars, CPA, tax and technology partner at Thomas, Zollars & Lynch, Ltd. of Phoenix, Arizona, and all-around tax sage, about everything from capital accounts in partnerships to unemployment relief and Paycheck Protection Program (PPP) loan forgiveness. But the question they really want to ask him is, “do you ever sleep?”

While the answer is decidedly “yes,” most would argue the validity of that given the quantity of carefully crafted responses he churns out daily to CPAs on both sides of the United States.

As a member of the New Jersey Society of CPAs, the Arizona Society of CPAs (ASCPA) and the American Institute of CPAs (AICPA), Ed takes it upon himself to respond to numerous complicated tax queries in the form of emails, member forum responses and calls. Since joining the NJCPA in July of 2018, Ed has posted more than 1,700 times to its Connect

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Open Forum, which has actually helped boost membership at the Society. At the ASCPA, Ed was the driving force behind Arizona’s roll out of their first member discussion group, the predecessor to their current Connect system. Throughout the years, he has also contributed to other CPA societies, such as the California Society of CPAs’ CalCPA Yahoo Groups, its TaxTalk and a tax news group.

Others know Ed as the over-subscribed lecturer for the accounting continuing education program at Kaplan Financial Education (the Loscalzo Institute) and frequent contributor to Kaplan’s Current Federal Tax Developments website. As teaching became increasingly more natural to him, Ed acknowledges, “I had no intention to build that classroom skill; it indirectly kept happening.”

So where did he hone such skills? From working with his clients, of course. “Clients have been doing that to me for years,

MIXING IN TECH A native of Phoenix, Ed says he’s “always been down here in the desert.” Though he does not come from a long line of accountants, the desire to help people does run in his family as his brother, Jack, is in law enforcement in Phoenix. Ed’s technology skills, however, could have come from his father, who was among some of the earliest IT professionals dating back to the 1950s. Along with accounting, Ed pursued his interest in technology while attending Arizona State University.

From there he worked to update the technology at Thomas, Zollars & Lynch, which ultimately led to him being recognized by the AICPA for his tech skills. While in charge of technology at his firm, he supported lots of software. That led to becoming involved with WordStar, the word processing program on CompuServe, where he became a moderator and a systems operator. In the early 1990s, the AICPA launched their own forum on CompuServe and asked him to work the moderation software for the forum and to become a systems operator for them. He subsequently was appointed to technology panels and became a regular speaker at many state CPA societies, including the NJCPA. Outside of helping CPAs, Ed also assists his local church, the Prince of Peace Lutheran Church in Phoenix, with what else? Accounting and technological assistance. He served for years as the financial secretary and continues to assist the current financial secretary with production work to run a podcast with the week’s sermon each Sunday.

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