Thinking about taking your leadership skills to the next level? Want to have an impact on the profession? Then apply today for 2018-19 CalCPA Board and Council, AICPA Council and CalCPA Education Foundation trustee and officer positions.

California CPAs are the driving force behind one of the world’s largest economies—and CalCPA provides the opportunities to help you develop critical leadership skills, and a platform to showcase them, at the local and state level.

Learn more or apply. Applications are due Dec. 4.

Latest on Tax Reform

The AICPA’s Tax Advocacy team has prepared a video overview of the recent tax reform happenings (halfway down the page, along with FAQs and other resources). The video provides a general overview and provides a quick analysis of the legislation in its current form.

CPA Day at the Capitol Jan. 17

All it takes is one individual—like you—and less than one day to make a difference at CPA Day at the Capitol.

Meet with California legislators to discuss issues that impact you, the public and the profession, such as preventing sales tax on services and promoting financial literacy. Once you register, we’ll handle the logistics of scheduling the appointments and providing you with talking points.

Make your voice—and the voice of the profession—heard at CPA Day at the Capitol.

PCAOB Offers Auditors Guidance on Rev. Rec. Standards 

The Public Company Accounting Oversight Board released a new practice alert to help auditors looking at how clients have implemented the Financial Accounting Standards Board’s new accounting standard on revenue recognition. 

The staff audit practice alert covers PCAOB requirements and other considerations, including: 

  • Transition disclosures and transition adjustments; 
  • Internal control over financial reporting; 
  • Fraud risks; and, 
  • Disclosures.

The new accounting standard, Revenue from Contracts with Customers, was adopted in May 2014, and will be effective for public companies for annual reporting periods beginning after Dec. 15. It is expected to require significant changes to company processes, and the PCAOB noted that that could “pose heightened risks of material misstatement, including fraud risks.”

CAQ Foresees Risks During Upcoming Audits 

The Center for Audit Quality has released two new member alerts spotlighting some of the potential risks facing audit firms during the upcoming 2017 audit cycle.

The first alert, Select Auditing Considerations for the 2017 Audit Cycle, describes a number of judgmental and complex areas for auditors, including auditor independence, multinational audits, transitioning to new accounting standards, audit areas potentially affected by economic factors, recurring audit deficiencies, financial reporting areas and disclosure of engagement partner and other participants in audits under PCAOB Rules 3210 and 3211.

The second alert, Select Considerations for the 2017 Audit Cycle for Brokers and Dealers, discusses some of the considerations pertaining to audit and attestation engagements for brokers and dealers registered with the SEC.

IRS Expands W-2 Verification Code for Filing Season 2018

For filing season 2018, the IRS has expanded the pilot program to verify the authenticity of Form W-2 data. The objective is to verify Form W-2 data submitted by taxpayers on e-filed individual tax returns. Here’s what’s new for 2018:

  • Verification codes will appear on more than 60 million tax year 2017 Forms W-2. That’s nearly one out of every four Forms W-2.
  • A Form W-2 with a verification code will display it in box 9, newly labeled “Verification Code.”
  • A Form W-2 without a verification code may include a blank box 9 or no box 9 at all.

Taxpayers and tax professionals are urged to enter the verification code when prompted by software, as it can speed the processing of the return and the issuance of the refund. However, omitted and incorrect verification codes will not delay the processing of a tax return.

The form will include these instructions to taxpayers and tax preparers: “Box 9. If you are e-filing and if there is a code in this box, enter it when prompted by your software. This code assists the IRS in validating the W-2 data submitted with your return. The code is not entered on paper-filed returns.”

The verification code will not be included in Forms W-2 or W-2 data submitted by the PSPs to the Social Security Administration or any state or local departments of revenue. Nor will this pilot affect state and local income tax returns or paper federal returns.