April Features

Outsourced Internal Audit Services and the Perception of Auditor Independence
By Marshall A. Geiger, D. Jordan Lowe, and Kurt J. Pany
The appearance of independence is strongly tested by the relationship between the internal and external auditor. The authors studied how financial statement users perceived varying relationships between internal and external auditors. The closer the relationship, the greater the perception of inappropriateness and the greater the likelihood of a negative evaluation of the financial statements. (Article)

New York Trust Law Offers New Planning Opportunities
By Stephen C. F. Diamond
Recent substantial changes to the New York State estates and trust law allow trustees to elect new allocations between income and principal interests under certain circumstances. Income beneficiaries may now benefit from gains in their trustís investment portfolios that would have been allocable only to principal under prior law. (Article)

The Basics of Bankruptcy Protection
By Scott Cousins and William E. Chipman, Jr.
Accounting advisors are often one of the first to know when an organization is facing financial difficulty. The sooner a restructuring plan is created, the more options that are available under the bankruptcy code. Early financial and legal action may be the key to a successful turnaround. (Article)

Financial Planning for Education Expenditures
By Lawrence C. Phillips and Thomas R. Robinson
As education expenses continue to rise at a staggering rate, the government has expanded the options available to taxpayers trying to save for college. The Economic Growth and Tax Relief Reconciliation Act of 2001 expands upon or modifies the 1996 and 1997 tax legislative changes and adds certain additional financial planning incentives. (Article)

Information Technology, Internal Control, and Financial Statement Audits
By Thomas A. Ratcliffe and Paul Munter
As businesses increasingly turn to electronic transaction and accounting systems, monitoring the controls over paper-based transaction and accounting systems is no longer adequate. SAS 94 offers guidance on collecting sufficient, competent evidence on the system of control within the electronic processing environment. (Article)

Recovering Computer Software Costs: Where Are We?
By Larry Maples and Melanie Earles
Applying Treasury Department and IRS regulations on the deductibility of software costs requires patience. With regulations being dropped and postponed indefinitely, clear and reliable guidance is in short supply. Taxpayers should do their best to follow the governmentís perceived intent until final regulations become effective. (Article)


  April Departments

Accounting for business combinations and intangible assets (Article)

Customized spreadsheet for tests of controls: Random sampling (Article) (Downloadable Spreadsheet)

The CPA in Industry
ESOPs rediscovered: Income tax advantages (Article)

Estates and Trusts
Gist taxes: The $325,000 exemption increase may not be the maximum tax-free gift (Article)

Federal Taxation
Taxpayer insolvency and discharge of indebtedness income (Article)

Government Accounting
Note disclosures for governments (Article)

The SEC Advisor
Materiality and audit adjustments (Article)

The CPA and the Computer
Technology worst practices in small and mid-sized organizations (Article)

Guest Editorial
Accounting rocks! By Priscilla Burnaby (Article)


News & Views

 ∑ Accounting that adds up 
 ∑ The eye of the storm     
 ∑ All about pro forma accounting  
 ∑ How writing across the curriculum can be incorporated into accounting programs 
 ∑ The disappearing state corporate income tax
 ∑ Website of the month: New York State Department of Taxation and Finance
 ∑ Book Review: The Six-Month Fix

Letters to the Editor
 ∑  Serious action requires serious thought
 ∑  Disputing that the profession is in decline
 ∑  Debt to elders in progress toward diversity 
 ∑  Schools have many problems, but money not foremost
 ∑  Political agenda

Coming Soon

 ∑ New internal audit guidance
 ∑ Accounting software
 ∑ Intellectual property


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