Created for organizations like yours, Share100 offers 100 hours of transferable CPE to share among your colleagues. Features include:

  • Use in any hour increments;
  • Valid for one year from date of purchase;
  • Combine hours from multiple Share100s;
  • One exclusive code per 100 hours; and
  • Apply to any CalCPA Education Foundation course and conference (in person, self-study and webcast formats).
  • The standard price is $2,995 ($30/credit hour). Are you a 100 percent membership firm? You can save 20 percent: $2,396 ($24/credit hour).

Learn more or purchase your Share 100.

CAMICO Tip of the Month: Warning Signs of Problems

Screen clients for potential problems well before any tax or other deadlines, thereby providing ample lead time for a client to replace you if you decide to disengage. Client screening should be conducted at least annually to identify less desirable clients that may be keeping your firm from developing the clients you want.

Some warning signs include slow payments, difficult or unresponsive behavior, lack of cooperation and withheld information or documents—especially if the client is urging you to proceed with work. Repeated delays could be warning signs of inappropriate, unethical or illegal activity.

Changes in the client’s business or in your firm (such as the loss of a partner) also may call for client screening. Look for potential conflicts of interest and any situations that may create opposing or disappointed factions.

If you disengage, do so in writing, professionally and formally, and include a clear description of your work and a list of any due dates or filings. Done effectively, disengagement can leave your client feeling that you’ve acted in the best interests of both parties.

For more information and guidance about CPA firm insurance issues, visit CAMICO online.

New FTB Filing Requirement

On June 29 the United States Treasury and the IRS released final regulations on country-by-country reporting. The information required under the regulations provides greater transparency regarding the operations and tax positions taken by U.S. multinational enterprise groups. The final regulations, as set forth in Treasury Regulations Sec. 1.6038-4, require U.S. multinational companies to prepare and file an annual federal Form 8975 and Schedule A (Form 8975).

The new filing requirement of federal Form 8975 applies to California taxpayers subject to the provisions of IRC Sec. 6038. Consequently, California taxpayers required to file federal Form 8975 with the IRS must attach a copy of federal Form 8975 to their California return. If federal Form 8975 is not provided, a penalty may be imposed under R&TC Sec. 19141.2.

Check out the who, what, when and how to file.

SEC Updates to Guidance on Revenue Recognition

The SEC recently issued an update to its guidance for bill-and-hold arrangements by stating that registrants should no longer refer to the criteria in Accounting and Auditing Enforcement Release No. 108, In the Matter of Stewart Parness (AAER 108), to recognize revenue for such arrangements upon the registrants’ adoption of Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers. The release states that until a registrant adopts ASC Topic 606, it should continue referring to the guidance included in AAER 108.

Separately, the SEC’s Office of the Chief Accountant and Division of Corporation Finance released Staff Accounting Bulletin (SAB) No. 116 that brings existing SEC staff guidance into conformity with the Financial Accounting Standard Board’s adoption of and amendments to ASC Topic 606. The SAB modifies SAB Topic 13, Revenue Recognition, SAB Topic 8, Retail Companies, and Sec. A, Operating-Differential Subsidies of SAB Topic 11, Miscellaneous Disclosure. The guidance in SAB 116 applies upon a registrant’s adoption of ASC Topic 606. Until such time, the SAB states that registrants should continue referring to prior staff guidance on revenue recognition.

FASB Issues Improvements to Hedge Accounting

The Financial Accounting Standards Board issued a final Accounting Standards Update (ASU) that will improve and simplify accounting rules around hedge accounting. The ASU is effective for public companies in 2019 and private companies in 2020. Early adoption is permitted.

The new standard refines and expands hedge accounting for both financial (e.g., interest rate) and commodity risks. Its provisions create more transparency around how economic results are presented, both on the face of the financial statements and in the footnotes, for investors and analysts.

The new standard takes effect for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2018, for public companies and for fiscal years beginning after Dec. 15, 2019 (and interim periods for fiscal years beginning after Dec. 15, 2020), for private companies. Early adoption is permitted in any interim period or fiscal years before the effective date of the standard.

Scam Targets Tax Practitioner Passwords

The IRS, state tax agencies and the tax industry are warning tax professionals about an email phishing scam impersonating tax software providers and attempting to steal user names and passwords.

This sophisticated scam yet again displays cybercriminals’ tax savvy and underscores the need for you to take strong security measures to protect your clients and your business. This is the time of year when many software providers issue software upgrades and when tax professionals are working to meet the Oct. 15 deadline for extension filers.

This latest scam email variation comes with a subject line of “Software Support Update” and highlights an “Important Software System Upgrade.” It thanks recipients for continuing to trust the software provider to serve their tax preparation needs and mimics the software providers’ email templates. The e-mail informs the recipients that due to a recent software upgrade, the preparer must revalidate their login credentials. It provides a link to a fictitious website that mirrors the software provider’s actual login page. Instead of upgrading software, the tax professionals are providing their information to cybercriminals who use the stolen credentials to access the preparers’ accounts and to steal client information.