Financial Management and Accounting
AICPA to Explore Separate Accounting Standards for Private Companies
The AICPA, the Financial Accounting Foundation, and the National Association of State Boards of Accountancy announced the formation of a panel charged with making recommendations on future standard setting for private companies. The panel was appointed and began their work in early 2010 in response to decades of debate over myriad technical accounting issues that impact U.S. private companies.
The panel includes members of various financial reporting constituencies including lenders, investors and owners, as well as preparers, auditors, and regulators. The accounting profession has widely applauded the move, and anticipates recommendations to be made by the panel within the year.
For additional information reported by the Journal of Accountancy, visit http://www.journalofaccountancy.com/Web/20092429.htm.
Building Your Career in Accounting and Finance—Successful Professional Development Night Yields Valuable Information and Networking Opportunities
The Building Your Career in Accounting and Finance seminar held on April 27, 2010, was a great success. Attended by a large number of UMUC graduate and undergraduate Accounting and Finance students, the event gave students the opportunity to network with professionals in their field and to hear insights from experts in professional and career development.
At the start of the event, students were invited to meet with accounting and finance professionals from a variety of organizations, including American Society of Women Accountants, Aronson & Company, Advancing Government Accountability, Association of Latino Professionals in Finance and Accounting, Institute of Internal Auditors, Information Systems Audit and Control Association, KPMG (Washington, D.C.), Maryland Association of CPAs , and National Association of Black Accountants.
Later, those in attendance were privileged to hear from three experts in their fields. Beth Berk, CPA, spoke about finding the right job fit by targeting positions suited to one’s nature. Next, Karen Milstein discussed the factors to consider when choosing among benefit alternatives at a new position. The evening culminated with a presentation by Jason Howell on Growing in Your Career, which focused on the mind set for career success. He emphasized the importance of taking risks, learning self-promotion and developing a commitment to personal growth.
Please take a moment to review the presentations of Beth Berk (Finding That Ideal Job) and Karen Milstein (Considering Your Benefits Options) and visit Jason Howell’s Web site. Also, watch for the announcement about our next Accounting and Finance Career Night!
SEC Continues to Focus on US Convergence with IFRS
Speaking this past November, Kathleen Casey, one of five SEC Commissioners, acknowledged the important need for a single set of accounting rules for global companies. She stated that the SEC and the FASB will continue to "support the development of a single set of high quality global accounting standards." FASB and the IASB are still aiming to develop a converging set of rules by mid-2011. Given that the goal of global convergence is to provide transparent and unbiased accounting information to investors, Casey warned that over-politicizing accounting rules or attempting to sway lawmakers in favor of particular industries could dilute investor confidence in the market. Current SEC Chairman Mary Schapiro said that the Commission will review the roadmap established last November by former Chairman Christopher Cox for US companies to report financial information under IFRS rather than US GAAP by 2014. The SEC has also promised to provide more clarity before 2010.
Understand Your Student Loan Forgiveness or Repayment Program
As the number of student loans has grown, so has the number of student loan forgiveness and repayment programs. Graduates now face multiple options for dealing with their accumulated educational debt. Many of these plans are extremely beneficial in helping graduates eliminate or manage their student loans, but there can be tax consequences.
Loan forgiveness or repayment plans typically fall into three categories:
- 10- and 25-year loan repayment and forgiveness plans
- partial loan forgiveness for entering high-demand fields such as the military, medical profession, federal government, teaching profession and volunteer service
- hardship relief for death or disability (but not bankruptcy)
Generally, if a lender forgives a student loan, that amount immediately becomes taxable to the borrower (graduate). An exception applies if after 10 years an unpaid balance remains but the graduate is employed in public service. For a better understanding of the issues in this area, read Student Loan Forgiveness and Repayment: A Road Map.
(Source: Journal of Accountancy, June 2009)
Forecasting the Current Downturn
The current economic downturn has financial managers wondering how accurately they can forecast financial operations and share price in the upcoming period of uncertainty. Authors Tim Koller, Bin Jiang,andZane Williams take a look into the past four recession in the United States. They found that the current recession is following patterns similar to the previous downturns. It began with a "core underlying shock that then spread through the economy in a fairly predictable way" (Koller, et al, pg 1). Different sectors are being affected to varying degrees, with healthcare and consumer staples, showing more resilience. Stock price and total shareholder return appear to be leading indicators or decline or recover across sectors. So, will this recession take 2 years from which to recover, or closer to a decade? Read Mapping Decline and Recovery to decide.
New Maryland CPA Licensure Regulations
Effective January 1, 2008, the state of Maryland has modified the education requirements that individuals must meet to qualify to sit for the Uniform CPA Examination.
The following changes are now effective:
- Group I—Accounting: Requires one course in cost or managerial accounting.
- Group II—Business-Related Education: Requires a minimum of 21 semester hours in at least five of the following subjects: economics, statistics, corporation or business finance, management, U.S. business law, marketing or business communication.
- Group III—Ethics Education: Requires one course in business or accounting ethics, the philosophy of ethics or a course that examines the framework of modern ethical decision-making.
For more information about Maryland CPA licensure requirements, go to State of Maryland Board of Public Accountancy.
To access information about CPA licensure in a state other than Maryland, visit the National Association of State Boards of Accountancy and select your state under State Board Listing from the drop down list to access the state board's Web page.
The Road to CFO
According to Alan Rappeport of CFO.com, "A solid grounding in finance and accounting never gets old for future finance chiefs. But these days, those hoping to become CFOs also need a dollop of charm and a global perspective," (p. 1, 2008). To learn more about which career paths lead to good CFO positions, and to help develop the necessary personal skills, read The Road to CFO.