Disclosures: July/August 2015

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INSIDE this issue

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Former VSCPA Chair Colette Wilson, CPA, discusses her career path as a minority in the accounting profession. She believes mentoring and opportunities are key to a more diverse profession.

ARTICLES

FEATURES WHY OPPORTUNITIES AND MENTORING MATTER

COVER STORY >>

WORK-LIFE BALANCE 12

AD INDEX 10

Beth A. Berk, CPA Conservation Partners LLC Digital Benefit Advisors Keiter PNC Bank Poe Group Advisors

What does corporate wellness mean?

The world is more diverse than ever, but we still need to address diversity and inclusion in the accounting profession — particularly in management roles.

THE AFFORDABLE CARE ACT AT 5 YEARS 16

SECTIONS

Where does the Affordable Care Act stand in its implementation, and what key future milestones should you be aware of?

BACKTALK

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PRESIDENT’S PERSPECTIVE

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LINE ITEMS

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DATA DRAFT

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VSCPA NEWS

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VSCPA EDUCATIONAL FOUNDATION

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I AM THE VSCPA

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CLASSIFIEDS

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THE FUTURE OF REVENUE RECOGNITION

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New standards from the Financial Accounting Standards Board will change how your company recognizes revenue.

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disclosures is published bimonthly for members of the Virginia Society of CPAs.

Our mission is to enhance the success of CPAs.

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VIRGINIA SOCIETY OF CPAs

4309 Cox Road Glen Allen, VA 23060 (800) 733-8272 Fax: (804) 273-1741 www.vscpa.com

BACKTALK you said it FROM VSCPA.COM >>

A TRIBUTE TO THE RENNERS

disclosures

I have had the good fortune to work with John and Joan for only a year.

They have been a joy to work with and for. While I recognized John and Joan as “good people,” I was unaware of just how good.

EDITORIAL STAFF

DUNCAN WILL, CPA Boca Raton, Fla.

http://disclosures.vscpa.com

Jill Edmonds Managing Editor disclosures@vscpa.com Chip Knighton Contributing Editor cknighton@vscpa.com

Business & Industry Conference kudos

David Bass Public Relations & Communications Director dbass@vscpa.com EDITORIAL TASK FORCE Olaf Barthelmai, CPA Adam Chaikin, CPA Cheri David, CPA Jennifer Duff, CPA Keith Gray, CPA Genevieve Hancock Alesia Lewis, CPA David Peters, CPA Jeff Schroeder, CPA George Strudgeon, CPA Barbara Sukramani, CPA DEADLINES Articles and advertising for future issues are due by 5 p.m. on the following dates: Sept./Oct. 2015 Nov./Dec. 2015 Jan./Feb. 2016 March/April 2016 July/Aug. 2016 Sept./Oct. 2016

July 6, 2015 Sept. 1, 2015 Nov. 2, 2015 Jan. 4, 2016 March 1, 2016 July 5, 2016

Statements of fact and opinion are made by the authors alone and do not imply an opinion on the part of the officers, members or editorial staff.

From the

TWITTERSPHERE >>

VIA FACEBOOK>> Wonderful 1st day! The sessions I attended were great and the facilitators were excellent and often very entertaining. Looking forward to more education and “connections” on Wednesday. Thank you VSCPA staff & volunteers for an excellent conference. Your hard work is appreciated!

JEAN POITRAS, CPA King & Queen

VIA ANONYMOUS SURVEY >> “I enjoyed all of the sessions I attended. I thought all of the discussion leaders did a very good job. I always enjoy the presentation by Thomas Jefferson. The re-enactor for him does an amazing job.”

“Tommy Harrington gave AWESOME software tips that I can begin using immediately at work.”

CONNECT: connect.vscpa.com TWITTER: @VSCPANews, @FinancialFit

Excited to be a part of the #VSCPA Board of Directors. Looking forward to a great year!

— @JENDUFF_CPA I received a letter appointing me to a Committee with the @VSCPANews. This has honestly been the best birthday present to receive yet. — @KATIEOCON

Thank you @GaryThomsonCPA for moderating this morning’s panel @VSCPANews PAC breakfast!

— @PROFMITCHELL @ProfMitchell @GaryThomsonCPA: He spoke at last years Leaders Institute too.

He gave great advice including to learn to play golf. — @CATRINA_WOLFE @catrina_wolfe @ProfMitchell: Glad the golf part stuck!

— @GARYTHOMPSONCPA @GaryThomsonCPA @ProfMitchell: More than the golf part but it inspired me to take lessons. Plus Twitter likes to limit what I say. — @CATRINA_WOLFE

LINKEDIN: tinyurl.com/VSCPALinkedInGroup FACEBOOK: facebook.com/VSCPA INSTAGRAM: instagram.com/VSCPA

VSCPA ENDORSED PARTNERS

Get in touch

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At the Virginia Society of CPAs, we love to hear from you.

Whether it’s a quick email to a staff member, chat on the phone, Disclosures letter to the editor, tweet tweet,or blog something comment different or something altogether, different let usaltogether, know whatletyou’re us know talking what you’re about, how you talking feelabout, about how different you feel issues about affecting different CPAs issues and how affecting we can CPAs help. and how we can help.

PRESIDENT’S perspective

The quest for quality The accounting

profession is built on trust. It’s the reason why CPAs go through the rigorous educational requirements and intense preparation required to pass the CPA Exam, and why businesses, taxpayers and governments seek out CPAs to ensure the quality and dependability of their financial records.

The work to maintain that reputation for quality — and therefore the position as trusted advisors on financial matters — is neverending. The accounting profession, with its long history of continuous improvement, holds itself accountable and drives the meaningful changes necessary to meet the demands of a constantly evolving, complex financial marketplace.

Simply put, the most meaningful change comes from inside the profession, rather than being imposed by outside agencies. That’s why it’s important for auditors to respond to professional quality issues as they arise. High quality drives the value and relevance of CPAs’ services, and it’s up to us to make sure that continues.

Most recently, those issues have cropped up in the area of employee benefit plan (EBP) audits performed by CPA firms. The U.S. Department of Labor (DOL), which oversees those audits, recently released a study of 2011 EBP audits that showed a 39 percent rate of major deficiencies with respect to U.S. Generally Accepted Auditing Standards (GAAS). The VSCPA and the American Institute of CPAs (AICPA) collaborated on a response to the study, which can be found at vscpa.com/DOLStudy.

The VSCPA and the rest of the accounting profession are committed to improving upon those numbers, which affect the reputation of all CPAs, whether or not they perform EBP audits. The Illinois CPA Society recently published a paper on the ongoing quality issues (icpas.org/insight-quality.htm) that is indicative of the profession’s attitude toward

the issues uncovered by the DOL. The CPA profession is committed to quality and public service, and the VSCPA will do anything possible to help our members live up to the high standard the profession has set.

And the public still responds to that standard.

Former AICPA Chairman Bill Balhoff, CPA, gave a professional issues update at the VSCPA Leaders’ Summit in May, and he cited statistics from Applied Research & Consulting that showed that business decision makers are overwhelmingly satisfied with the work done by internal and external CPAs. Three-quarters of those surveyed said they would be more confident in a job done by a CPA than one done by a non-CPA accountant, and 71 percent said that the CPA credential requires more vigorous testing and training than any other financial credential.

Practice Monitoring of the Future concept paper, which introduced the idea of real-time detection and correction of deficiencies. The peer review process is one of the most visible ways the profession can police itself, and it is vital that reviewers are empowered to effect real change.

The CPA profession was focused on improving audit quality long before the DOL began looking into EBP audits, and our commitment to audit quality must continue, both on this issue and across the field. The VSCPA, the professionals that make up our membership, and like-minded organizations across the United States will rise to the challenge and continue to live up to the high standards that make the CPA credential such a powerful statement. Audit quality issues like those identified by the DOL are a reflection on CPAs everywhere, but so is our response to those issues. With your help, we can eliminate them and continue protecting businesses and taxpayers in Virginia and across the country. n

While trust in the profession remains high, it’s up to us, as a profession, to live up to that trust. Only an unflinching commitment to quality will ensure that CPAs maintain their reputation for quality and objectivity. The profession has taken steps to address quality issues — notably the AICPA’s public companyfocused Center for Audit Quality, which Balhoff described as “the best money we’ve ever spent,” and the more recent launch of its Enhancing Audit Quality (EAQ) initiative, which provides similar resources to privatecompany audits. Even on the specific issue of EBP audits, the AICPA provides tools, resources and best practices through its EBP Audit Quality Center. We encourage those of you in the audit field to avail yourselves of these resources. See page 7 for six ways to improve audit quality, released from the EAQ initiative.

STEPHANIE PETERS, CAE, has served

The profession also shows its commitment to quality by policing itself through the peer review process, and the AICPA, the VSCPA and other state societies are committed to ensuring the continued success of peer review through constant refinements. The AICPA recently solicited comments for its

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as president and CEO of the Virginia Society of CPAs since 2007. speters@vscpa.com connect.vscpa.com/StephaniePeters @StephPeters

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Debit card mandate repealed

TALKING TECH WITH VSCPA MEMBERS VSCPA advocacy at work: Gov. Terry McAuliffe (center) signed the debit card mandate repeal into law on May 27. Joining him for the signing were (top row) VSCPA members Ryan Losi, CPA, and Nick Harrison, CPA, and (bottom row) VSCPA Vice President of Advocacy Emily Walker, CAE, Virginia Sen. George Barker (D-Alexandria), VSCPA legislative counsel Bill Axselle and VSCPA President & CEO Stephanie Peters, CAE. Harrison chairs the VSCPA Tax Advisory Committee; Losi is vice chair. The legislation reinstates the paper check option for Virginia individual income tax refunds. n

Earlier this year, VSCPA members participated in a survey conducted

by Network Management Group, Inc. (NMGI), on operations and technology in use at accounting firms. Visit vscpa.com/ LearningTechniques for some takeaways from the survey and how you can leverage different learning styles to best train your staff. n

>> EXCELLENT EXCEL: FINDING DUPLICATE VALUES Do you ever get a list from the client that you know should not contain any duplicate values (e.g. invoice numbers, user IDs, etc.)? If you do, you could count the number of items in the list and run the “Remove Duplicates” function under the DATA tab in your menu ribbon and then recount the items to see if the number of items drops. If the number drops, how would you know which ones were duplicates? To solve this conundrum, consider using Conditional Formatting and a Filter to get the job done.

To get started, highlight your list of values. With the items highlighted, click on the down-arrow under Conditional Formatting on the HOME tab in your ribbon. Select “Highlight Cells Rules” to get its submenu. Under the “Highlight Cells Rules” submenu, select “Duplicate Values.”

You should now have a dialog box open where you can

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change the format of the cells with duplicate values, or unique values if you desire. Whew, that was a lot, but you are almost there. Now you can quickly use the Filter function on the DATA tab ribbon to apply a “Filter by Color” to select those items that were formatted using Conditional Formatting. Presto, you now know which ones are duplicate values. n GEORGE D. STRUDGEON, CPA, CGFM, is an audit director at the Virginia Auditor of Public Accounts in Richmond. He is a member of the Disclosures Editorial Task Force. Email him if you have Excel topics you want him to cover. george.strudgeon@gmail.com connect.vscpa.com/GeorgeStrudgeon

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How to improve audits in 6 steps In a constantly changing business

environment, how do you ensure audit performance stays up to par?

You create a roadmap for enhancement.

That’s exactly what the American Institute of CPAs (AICPA) did with its Enhancing Audit Quality (EAQ) initiative, which launched in May 2014. After a discussion paper generated hundreds of comments, the EAQ developed a “Six-Point Plan to Improve Audits,” released in May 2015. The plan focuses on financial statement audits for private companies, employee benefit plans and U.S. government entities.

The six focus areas for the plan are: 1. PRE-CPA LICENSURE: A next version of the CPA Exam designed to increase assessment of higher-order skills, such as critical thinking and professional skepticism; a high school Advanced Placement accounting course; changes to collegelevel accounting education; additional doctoral-level audit professors with practical experience.

2. STANDARDS AND ETHICS: Quality control standards implementation support; auditor’s report revisions; evaluation of clarified standards implementation; ethics code codification.

3. CPA LEARNING AND SUPPORT: Competency models for audit engagements, including employee benefit plan and governmental audits; competency assessment tools; targeted resources to develop competencies; certificate programs to demonstrate competence.

4. PEER REVIEW: Increased focus on greater risk industries and areas; more significant remediation; root cause analysis; termination from the peer review program after repeat quality issues.

5. PRACTICE MONITORING OF THE FUTURE: Long-term initiative for near real-time, ongoing monitoring of firm quality checks using robust technological platform.

6. ETHICS ENFORCEMENT AND NASBA COLLABORATION: More aggressive pursuit of reported deficiencies and stronger ties with the National Association of State Boards of Accountancy (NASBA) and state boards of accountancy.

Find your perfect match Ever wish you could talk to another CPA about their career path, or get leadership advice and help? Or have you wanted to connect with younger CPAs and guide them through their own careers? Now you can, through the VSCPA’s newest program, MentorMatch.

Through Connect, the VSCPA’s members-only online community, mentors and mentees can meet each other to build mutually beneficial relationships. Advanced professionals will be able to give back to the profession and foster the next generation of CPAs. Young professionals can get career and also help guide student members. And VSCPA student and CPA candidate members can receive advice on taking the CPA Exam and getting started in the profession.

BE A MENTOR to enhance your leadership and management skills, give back to your profession, share your skills and knowledge, build lasting relationship and expose yourself to diverse perspectives and experiences.

BE A MENTEE to learn specific skills, expose yourself to various career options, increase your opportunities to network, gain insight into your strengths and weaknesses, build relationships and learn about diverse experiences.

Enrolling in MentorMatch is easy! Simply log in to connect.vscpa.com and click on the MentorMatch tab.

Contact VSCPA Member Engagement Manager Laura Cobb at lcobb@vscpa.com if you have questions. n

The full report is available from the EAQ initiative at http://tinyurl.com/AICPA-EAQ. n

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DATA draft

Feeling the strain of college loans

A DISASTER IN VIRGINIA:

How prepared are we?

Virginia is at a higher risk

for declaring a disaster than many other states, according to the Federal Emergency Management Agency. Since 1953, Virginia has declared 47 MAJOR DISASTERS; the national average is 42. So how does the Commonwealth stack up on national preparedness rankings? >> 7 OUT OF 10: That’s the ranking Virginia received from the Trust for America’s Health on its 2012 report on bioterrorism and public health preparedness. Virginia was in the TOP 15 of most prepared states. >> 7.9 OUT OF 10: The National Health Security Preparedness Index gave Virginia this score on preparedness for health threats and emergencies, landing it in the NO. 3 spot among all states.

The Commonwealth is also one of 31 states to receive full accreditation by the Emergency Management Accreditation Program (EMAP), which has rigorous national standards in 15 areas like planning and procedures, resource management, training and more.

Find out more about Virginia’s disaster preparedness efforts in the “Public Safety” section of the Virginia performs website at vaperforms.virginia.gov. n

This is a big deal, considering the amount of student loan debt in the United States. The Federal Reserve Bank of New York says that the total amount of loan debt doubled from 2006 to 2012. n

THE OTHER SIDE OF SOX Companies that are transparent about their weaknesses in Section 404 of the Sarbanes-Oxley Act (SOX) may actually be hurting themselves.

A new study published in The Accounting Review, the journal of the American Accounting Association, discovered that there is a higher likelihood that companies that are open about their internal control issues will face penalties — which is the opposite of the law’s intent.

The study found that the transparent companies faced the following repercussions:

>> Class-action lawsuits (5 to 10 percent)

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>> Top management turnover (15 to 26 percent)

The average wait time in minutes for callers to the U.S. Internal Revenue Service during tax season 2015, according to WalletHub. n

DISCLOSURES

Those regrets don’t necessarily mean college was a bad idea: 68 PERCENT of adults with degrees said, if given the chance to make their decisions over, they would still have gone to college to get more lucrative jobs. However, 84 PERCENT would make at least one different choice regarding their educations, such as choosing a less expensive college (54 PERCENT), going to a trade school (43 PERCENT) or delayed enrollment to build savings (27 PERCENT).

>> Enforcement actions by the U.S. Securities and Exchange Commission (6 percent more likely)

>> BY THE NUMBERS

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When it comes to paying for college, more than half of Americans with loans regret their decisions. According to a survey from the American Institute of CPAs (AICPA), 68 PERCENT of Americans with college loans or who have children with loans regret it; that’s an eight-point increase from the 2013 survey.

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>> Auditor turnover (6 to 9 percent)

Read more in the May issue of The Accounting Review at aaajournals.org. n

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WORK-LIFE balance

Beyond the buzzword: Corporate wellness

BY DAVID PETERS, CPA

The phrase “corporate wellness” has become one of our new favorite buzzwords.

While we were busy “calibrating our expectations,” “leveraging our strengths” and “making it pop,” corporate wellness has snuck into day-to-day conversations in cubicles and behind office doors. We have started corporate wellness programs, campaigns and initiatives. Our HR managers have started keeping track of wellness metrics and wellness targets. Our CEOs are even starting to preach virtues of corporate wellness.

But why all of this attention around corporate wellness? Isn’t corporate wellness just a business way of saying “cut down on the burgers and fries at lunch time?” Is there really anything behind this new buzzword?

We already know that we should eat healthier and exercise on a regular basis. Do we really need yet another phrase to remind us of the virtues of the 5 a.m. workout?

While eating healthier and exercise are certainly distinct parts of corporate wellness, the concept itself is much more comprehensive.

Corporate wellness tries to incorporate a more general sense of healthiness in our day to day office lives — and for good reason. While the smell of McDonald’s french fries at noon is certainly a difficult temptation to overcome, it may not necessarily be the biggest threat to your health.

Walking while you work: It might take a little getting used to, but VSCPA member David Peters, CPA, says treadmill desks are doable and a great way to keep moving during the workday.

A myriad of articles and news stories have recently focused on something that is much harder for most of us to get away from — our desk chairs. Sitting (and sedentary living in general) can lead to an increased risk of diabetes, heart disease and colon cancer.1 And boy, do Americans ever do a lot of sitting. According to an article on the Mayo Clinic website, 50 to 70 percent of people spend six or more hours sitting a day.1 We accountants certainly fit into that mold. If you are like most, you sit at your kitchen table sipping your morning coffee. You sit in your car on the way to work. You sit at your desk most of the day too, making sure your debits equal your credits. Then, we sit as we drive home, knowing that tomorrow will be another day of sitting.

Is there really anything you can do about this? After all, can accounting not be a desk job? In my opinion, the answer is a resounding yes. Even

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WORK-LIFE balance

a simple thing like standing can have profound effects. By reducing your sitting to only three hours per day, a person can increase their life expectancy by approximately two years.1 Corporate wellness is less about expensive workout equipment and fancy dieting and more about integrating healthier living into all parts of corporate life. It is about changing corporate culture and allowing healthy living to permeate the mindset of the organization. There are some very simple and inexpensive things an organization can do.

THE WALKING MEETING Contrary to popular belief, there is nothing saying that you have to sit down during a meeting. People don’t think better sitting down, and in certain instances (especially around 2:30 p.m.), sitting is more of an invitation to fall asleep than stay engaged. The idea behind the walking meeting is simple — you walk while you talk, usually as you take a lap around the building or around a park near your office. Aside from getting some fresh air, it also gets your blood flowing. While not a viable alternative for meetings with large groups of people, it works well in small group settings. As Alan Kohll from Wellness Corporate Solutions describes it, “the walking meeting is an active replacement for the typical one-on-one cup of coffee or conference room chat.”2 I can tell you from firsthand experience that the walking meeting certainly feels strange the first time you do it. However, over time, it becomes more natural. We have been conducting walking meetings at Compare.com for more than two years now. We have also adopted a relative of the walking meeting as well — the standing meeting. For short meetings, it is starting to become our norm to stand up.

office started buying bananas and apples each week about two years ago.

No matter how many we buy, they always disappear! People love free food, so you might as well have them eat healthy!

These are just a few ways that corporate wellness can be interwoven into the life of an organization. This is not to say that gym memberships or low-carb diets don’t have their place in corporate wellness programs.

They certainly do. However, I offer these suggestions as relatively simple ways to integrate corporate wellness into what you already do at work.

Whether you take these suggestions or you make up your own, please remember that the ultimate key to successful integration of corporate wellness into your company is having fun. Seeing if your department can out-step the others on the walking treadmill this week can help make corporate wellness an integral part of what the company does.

Aside from helping your employees live longer, it will help them be more alert, happier and better at their jobs. n

1. Nelson, J., & Zeratsky, K. (2012, July 25). Nutrition-wise blog: Do you have ‘sitting disease’? Mayo Clinic website: mayoclinic.org/healthy-living/ nutrition-and-healthy-eating/expert-blog/sitting-disease/bgp-20056238.

2. Kohll, A. (2015, January 23). “Walking Meetings: One Small Step for Worksite Wellness.” Corporate Wellness Magazine: corporatewellnessmagazine.com/worksite-wellness/walking-meetings-one-small-step-forworksite-wellness/.

DAVID PETERS, CPA, is the head of legal, admin, finance and management information systems at Compare.com in Glen Allen. He is also an adjunct professor in accounting at Strayer University in Chesterfield and a doctoral student in financial planning. He is a member of the Disclosures Editorial Task Force.

THE TREADMILL DESK AND THE BIKE DESK Okay, I know what you are thinking: “I can barely get the money in my budget for a regular desk. How in the world am I going to afford a treadmill desk?” They are not as expensive as you might think (you can usually find one for around $2,000 or less), and they are a great way to fit some cardiovascular fitness into the normal workday without paying for massive amounts of gym equipment. Like the walking meeting, this one also takes some getting used to. (Trust me, it takes some time to figure out how fast you can walk and type at the same time!) However, it is a relatively cheap way to promote fitness in everyday office life, not to mention a good conversation starter for clients and office visitors.

david.peters@compare.com compare.com

HEALTHY SNACKS If your office is anything like mine, food goes fast. If there is anything out in the break area that doesn’t have a name on it, it is certain to disappear. If that’s the case, why not make healthy food available? My

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DIVERSITY

WHY OPPORTUNITIES AND MENTORING

MATTER Perspectives of a minority CPA in the accounting profession

BY COLETTE WILSON, CPA

The world is more DIVERSE than it has ever been, there are a multitude of LAWS and MOVEMENTS supporting equality and inclusivity of every group imaginable, we’ve had an African-American PRESIDENT for the last six years, and yet we are still talking about the need for DIVERSITY AND INCLUSION.

DIVERSITY

More specifically, we are looking at diversity and inclusion in the accounting profession. Why?

The American Institute of CPAs (AICPA) is currently focused on this issue, through its Diversity and Inclusion Initiative, to help ensure that today’s CPAs fully represent the changing demographic communities we serve. The VSCPA is also addressing diversity by developing initiatives that include a focus on sharing the accounting profession with minority students.

Now the topic of diversity and inclusion covers the gamut of race, gender, age, sexual orientation and overall background. My experiences are from the perspective of an African-American woman, working in a profession of mostly Caucasian women that is led by mostly Caucasian men. I do believe we need to advance diverse accounting professionals into management and leadership roles.

During my career, I was the first minority partner in my firm, one of only a few minorities on the VSCPA Board of Directors and, most recently, the first African-American woman to chair the Board. In addition, I was only the third African-American woman to chair a state CPA society in the nation. I’ve been in this profession for more than 20 years — surely another African-American woman would have reached such a position before me. While I am very humbled and honored by these facts, it is very disheartening to see that these firsts are just happening in recent years.

So why are diversity and inclusion such an issue for our profession, or for any other white-collar profession, for that matter? U.S. Census Bureau information tells us that the composition of the population in the United States is changing quite a bit. James H. Johnson Jr. and John D. Kasarda of the Frank Hawkins Kenan Institute of Private Enterprise, part of the Kenan Flagler Business School at

the University of North Carolina at Chapel Hill, issued a report on this subject.

“Six Disruptive Demographic Trends: What Census 2010 Will Reveal” discusses trends that occurred over the first decade of the millennium and are expected to continue.

The report is very interesting because it demonstrates the complete diversity of our population, impact on consumer markets and changes to our workplace. According to Johnson and Kasarda, white males will no longer be the majority in the working world, although that’s not a shock to most.

The United States population has seen, and will continue to see, more immigrants coming in, staying for longer periods of time and joining the workforce; more minority women taking lead roles in business; the growth of interracial marriages (thus further diversifying the population); and more people working in their “retirement” years, creating a professional workforce of both young and older people. Now if that’s not diversity and inclusivity, I’m not sure what is. So what are the most important issues for the accounting profession?

I believe greater diversity is most needed in management or higher positions.

From discussions I’ve had with accounting professionals at recent conferences, employers continue to see diversity in new staff. College graduates and those joining the accounting profession for the first time cover a wide spectrum. I, too, have seen diversity at college fairs — foreign students are eager to join the prestigious accounting profession and older students are obtaining master’s degrees and accounting certificates to start a second career in accounting. These groups are “entering” the

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accounting profession, but they are not staying and advancing on to higher-level positions.

Three to five years into their profession may be great, but what happens at the five- or 10-year mark? Is this same group advancing in their firms? Are they being coached into management positions? Do they see themselves as senior managers or partners one day? Are they actively involved in professional associations? Generally, I think the answer is no. From my experience, this is where the diversity in our profession starts to fade.

How can we bridge this diversity gap in the accounting profession between staff/ seniors and management/partners? If I had the answer, I’d run and tell the AICPA to implement my strategy. Unfortunately, I don’t.

But what I do have is an opinion based on my own career experience. The two factors that helped forge my way into a successful accounting career as an African-American woman are opportunities and mentoring.

I grew up in a military family and thus had several opportunities to meet new friends, live in different cultures and be forced to build relationships with various types of people. I’ve lived in five states, in Germany and on the island of Guam. I also attended three different high schools. I was fortunate in this way because I have been faced with diversity all my life; it’s natural for me to interact with different folks and still be the minority. That’s not true for everyone, though.

When it comes to diversity, it may not be an easy transition if you have grown up in the same neighborhood through your adult years, lived around families in the same economic class, joined a job or profession that you were expected to succeed in and worked with in an environment where everyone looks, acts and talks the same as you. That’s no fault of those individuals; however dealing with u

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DIVERSITY

>> DIVERSITY & INCLUSION INITIATIVES Here are ways the accounting profession is striving for more a more diverse profession: AMERICAN INSTITUTE OF CPAs (AICPA) DIVERSITY AND INCLUSION TEAM and NATIONAL COMMITTEE ON DIVERSITY AND INCLUSION: Groups that propose strategies to recruit, retain and advance under-represented minorities in the profession RECRUITMENT AND RETENTION TOOLKIT: Resources from the AICPA to help accountants attract, recruit and retain an inclusive workforce ”INCLUSION SOLUTIONS” NEWSLETTER: An AICPA newsletter featuring best practices, trends and diversity news VSCPA MINORITY SCHOLARSHIP: This $1,000 yearly scholarship is awarded to, on average, three recipients each year to undergraduate or graduate minority students demonstrating academic excellence and financial need. Visit vscpafoundation.com for more information.

See aicpa.org/diversity for the AICPA resources.

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diversity may not come as easy and the need for diversity may not be as apparent. This goes for white, black, Hispanic and other minorities alike.

When I began my first job, I was not seen as a minority woman, fresh out of college, who needed her hand held. I was given the opportunity to work alongside the managing partner on a new (and tough) client, and given more responsibility than I could handle.

With that chance to prove myself, I stepped up to the plate and worked as if I had all the experience in the world. You can’t shy away from opportunities. Challenges are what help us to succeed. I worked alongside a senior manager and followed his every move. I addressed clients the way he addressed clients, I prepared my work the way that he prepared his work, and I asked a ton of questions, which he was more than willing to answer.

This was my first of many informal mentors.

Again, opportunities and mentoring were the foundation for my career and what helped to propel me to greater things not generally anticipated for an African-American woman.

As my career continued, I used my ability to relate to various people and the confidence I gained from my first engagement to my advantage. I had no problem talking to superiors, relating to my peers and interacting with clients. It just was not an issue for me and it benefitted me greatly. I did, however, sometimes experience questions or comments regarding my openness. I had peers ask my why, or how, I could just go and talk to certain superiors (who were always of a different race and gender). That was a strange question to me, but I could see how someone who was not used to being in a diverse environment would see it as a stretch, challenge or something that should not be done without permission. I would also get surprised looks when meeting a client for the first time and introducing myself as the partner-in-charge. Some were taken aback, while others were pleasantly surprised.

African-American women in their 30s are not generally expected to be partners in their firms, especially if they are not employed in a minority firm, which I was not.

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OPPORTUNITIES It’s important for people to seek out opportunities and be open to saying yes. So often, people look at who is in a position, or who was given the opportunity or who is leading the charge before making a decision about pursuing something. It can defeat a person before he or she ever has the chance to try. Who cares if the current management team is all white men? That doesn’t mean that you can’t join them or learn from them. So what if you have never considered applying for a Board of Directors position? That doesn’t mean that the current board isn’t looking for a fresh perspective. We women and minorities can be our own worst enemies if we only look at what precedes us. I was very much interested in all of the opportunities I saw around me in my career, and I wanted to experience it all just like others, regardless of who preceded me.

Along those same lines, I believe that those currently in management and/or leadership roles should reach out to young, talented and diverse employees. Identify the potential they may have, recognize that they may be apprehensive due to differences that exist, introduce them to a new opportunity, coach and mentor them and embrace the possibility of discovering a diamond in the rough. It is absolutely a two-way street in that, often, a younger, minority employee needs to step up, want to be included and be ready to take ownership, while the experienced, mainstream manager should be looking at all talent and for ways to expand and share leadership roles.

Diversity and inclusion cannot be developed if opposite parties are waiting for the other to step out of his or her comfort zone alone, or waiting for a golden opportunity to be presented without any effort on the recipient’s part.

MENTORING Mentoring is the other key to this issue as it relates to inclusion. There is nothing worse than feeling out of place, but with the proper mentoring, that feeling is easy to overcome.

My mentoring was mostly informal during my career. I sought out professionals who

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DIVERSITY

Becoming a mentor or finding one is now easier than ever with the new MentorMatch program from the VSCPA. Find it in Connect at connect.vscpa.com. See page 7 for more detailed information.

impressed me and possessed traits and skills I felt I needed to be successful. Being a minority, you often feel the need to fit

in but still want to be your own person. I accomplished that by following what my superiors did and adding my own personal style to it. I am very personable and would often have additional discussions with the client to get to know them. It made for easier technical discussions and showed them that I cared. I learned from my mentors the art of conducting effective meetings, pursuing and asking for professional advancement and conducting myself in a manner that commanded respect. These are all things that were crucial to my career development. So when challenges and opportunities present themselves (i.e., speaking to college students, confronting difficult clients or being elected to partner, nominated to a board or installed as a chair) I was confident and ready to lead.

as an African-American woman. This is why I am so passionate about mentoring. I share my experiences with recruiting and dealing with clients, good decisions and bad choices, as well as advice on seeking out and taking advantage of opportunities. Opportunities are the way to make a difference and to change the direction of your career.

I wish that every accounting major could have the success that I have enjoyed, specifically

As minority women, we must strive to excel, take advantage of opportunities and say yes.

We should remain engaged in our profession and fully utilize the prestigious honor of being a CPA to make a difference. Whether that difference is in your own career, or that of someone else, let’s ensure that our profession is well represented. The overall goal is to attract, and more importantly retain, accounting professionals that will aspire to be CPAs and advance to management or higher positions within the profession. It is in those leadership roles that we will best represent and serve our clients, and preserve our profession to mirror the world we live in today. n

Game Change.

We just broke the mold in the benefits industry. We’re offering the single most critical benefit for you and your clients — advice. Sound, actionable advice. This changes everything.

Game On?

COLETTE WILSON, CPA, is a former partner with Cotton & Company in Alexandria, and served as chair of the VSCPA Board of Directors in 2014–2015. colettew@gmail.com connect.vscpa.com/ColetteWilson

Endorsed by the VSPCA

B r i a n M a r k s , P r i n c i Pa l 877.998.7272 e M a i l : bmarks@digitalbenefitadvisors.com v i s i t : www.digitalbenefitadvisors.com/vspca

call:

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Needless to say, I am very proud of my career as a minority woman in accounting. I am grateful to the firm I worked in for more than 19 years and to the VSCPA. I would like to see the profession continue to expand in the area of diversity. I think there should be more minorities involved in professional associations, more female partners and more representation at the senior management level.

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HEALTH care

The Affordable Care Act at

5 YEARS

BY BRIAN MARKS, CEBS

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HEALTH care

The Affordable Care Act (ACA) has taken many turns since it was enacted on March 23, 2010. There have been multiple delays and clarifications since its passage. On its fifth birthday, here is an update of where the ACA stands in its implementation and key future milestones.

The ACA’s impact has been immense. Its intent was to provide access to affordable health care coverage for all Americans, and public opinion has been divided since its passage. A recent Kaiser Health Tracking Poll found 43 percent of Americans have a favorable view of the ACA and 42 percent view it unfavorably. This division is likely a result of the law’s varying effects on different individuals.

The ACA altered the various segments of the health insurance market in different ways. I will attempt to cover the major effects it has had, and potential future effects, on each segment. This is a high-level summary of key changes, and there are certain concepts that clearly go well beyond the scope of this article.

INDIVIDUAL MARKET Since Jan. 1, 2014, all Americans are required to have minimum essential health insurance coverage or pay a tax. This tax has led to more complexity in our tax code and confusion among taxpayers. The tax for 2015 is the greater of $325 per person, or 2 percent of income, and the tax increases in subsequent years. All individual coverage is available on a guarantee-issue basis but must be purchased during the annual open enrollment period absent of a qualifying event. For 2016, the enrollment period will run from Nov. 1, 2015, through Jan. 31, 2016.

Individuals can purchase policies in the marketplace and receive a subsidy if their income is generally between 100 percent and 400 percent of the federal poverty level and they have no access to affordable minimum

value coverage through an employer plan.

These subsidies are only available to purchases made through the marketplaces. The Centers for Medicare & Medicaid Services (CMS) announced on March 31, 2015, that 10.2 million people have health insurance through federal/state marketplaces in 2015.

Of these individuals, an estimated 85 percent will receive a federal subsidy for their coverage. CMS also stated that 7.5 million of these individuals live in states that utilize the Federally Facilitated Marketplace (FFM).

FFMs operate in states like Virginia that chose not to establish their own marketplaces. At press time, the validity of the payment of a subsidy through the FFM is before the U.S. Supreme Court with the King v. Burwell case. The Court has heard arguments and was expected to deliver a decision in June. If the Court rules that these subsidies cannot be paid through FFMs, it will clearly have a major impact on the ACA. Individuals who do not have access to employer plans and are not subsidy-eligible generally purchase plans in the private market (i.e. off of the marketplace) because many of the marketplace providers offer limited product selections or plans with a smaller provider network than traditional plans.

However, most carriers’ individual plans offer significantly fewer product choices, more intensive cost controls and more limited networks than their group programs. These factors, coupled with the tax-favored nature of group programs, appear to be driving some smaller groups that had traditionally had individual plans back to the group market. It’s a trend I do not believe many people expected.

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SMALL GROUP CHANGES EXPANDING TO 51–100 EMPLOYER GROUPS A small group in Virginia has been defined as an employer with at least two but less than 50 full-time equivalent (FTE) employees.

This definition will expand to 100 employees in 2016. There were significant underwriting changes to the 2–50 market in 2014 that led to major pricing disruptions: >> No medical underwriting or risk adjustment >> Age bands can be no larger than 3:1 from youngest to oldest >> Tobacco users may receive a 50 percent surcharge These changes had various effects on groups, depending upon their demographics and medical risks. Younger groups with less-thanaverage medical risks were negatively affected from a rating standpoint, while older and/or high-risk groups saw favorable results. Some groups with favorable risks negatively affected by these underwriting changes (many times with increases of 50 percent or more) pursued self-funding, which allows for medical underwriting. This led to lower rates than an employer with a favorable demographic and risk profile could obtain in the non-medically underwritten post-ACA market. Self-funding in this context is greatly simplified, as compared to large group self-funding.

Essentially, a group is funded at the “worst case” scenario, and then if its claim u

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HEALTH care TABLE 1. IRS FORMS REQUIRED FOR APPLICABLE LARGE EMPLOYERS’ HEALTH CARE REPORTING FORM

PURPOSE

USED TO DETERMINE IF ER OWES PENALTY

1094-C

X ER reports summary information to IRS

1095-C

X ER reports information about each individual employee covered

1094-B, C ER reports information about employees enrolled in plan

USED TO DETERMINE IF EE IS ELIGIBLE FOR SUBSIDY

WHO NEEDS TO FILE

INITIAL PERIOD FORM COVERS

DEADLINE (2016)

Applicable large employer, generally 50+ FTEs

2015

Feb. 28 for paper; March 31 for electronic

X

2015 Applicable large employer, generally 50+ FTEs; if fully-insured, the carrier completes 1095-C Part III, employer does not need to complete

X

ER offering self-insured health but is NOT an applicable large employer (generally less than 50 FTEs)

2015

Feb. 28 for paper; March 31 for electronic; 1095-C due to employees by Jan. 31 Feb. 28 for paper; March 31 for electronic

FTE = Full-Time Equivalent per ACA ER = Employer EE = Employee

experience is favorable to projections, some of the gains are returned. Also, this approach leads to more traditional rate structures of employee, employee plus spouse, family, etc.

The ACA mandated each employee receive a rate based upon their age with dependent/ family rates as a compilation of each member’s individual rates. These new age rating tiers are stated as one rate for those 20 and under in one-year bands from ages 21 to 64.

Administering these age tiers is extremely problematic for employers that had been underwritten on community rates; the new age-rated approaches dramatically affected their employees. Some carriers offer the accommodation of conversion-to-rates as a billing option, while others do not.

Conversely, groups with poor medical risks or older ages were favorably impacted by the ACA changes. The punitive nature of individual underwriting no longer exists

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for medical conditions, and older members have pulled to the mean. Clients with high rates relative to the market pre-ACA enjoyed significant rate reductions in the 2–50 market in 2014.

All of these aforementioned small group changes that affected the 2–50 employer in 2014 will affect the 51–100 employer in 2016. Underwriting changes will create the same effects of winners and losers in this market segment. Therefore, employers will use the same strategies of eager acceptance or delay and/or avoidance. If these employers so choose and implement the appropriate strategies, they can delay ACA-mandated changes until Oct. 1, 2017, due to transition relief regulations in Virginia. Groups will need to weigh the advantages and disadvantages of changing their renewal dates. Any employee amounts accumulated toward deductibles and out-of-pocket maximums will be reset.

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However, if the savings are large enough this could be justified. It is wise to seek the counsel of qualified employee benefit professionals to ensure you fully understand all effects.

100+ GROUP IMPACT The employer mandate has been in effect since Jan. 1, 2015, for employers with more than 100 FTE employees — commonly referred to as the “play or pay” penalty. The penalty is $2,000 per employee minus the first 80 employees (reverts to 30 employees in 2016) if there is no coverage offered, or if the coverage offered does not meet the minimum benefit level of bronze coverage. Bronze coverage is considered to be 60 percent actuarial value (i.e. 60 percent of medical costs are paid by the plan).

For coverage requirements and penalties, the ACA defines an employee as an individual

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HEALTH care

working at least 30 hours a week on average.

Determining if an employee is benefit-eligible can be complex. Employees who work variable hours should be monitored closely.

If their working hours exceed 30 during an established measurement period, they must be offered benefits to avoid the penalty.

If an employer offers a plan that is at the aforementioned minimum benefit level, it must also be affordable to avoid any possibility of a second penalty. The affordability penalty’s safe harbor is based upon an employee’s premium cost of the lowest level plan offered — not to exceed 9.5 percent of the employee’s wages. If the expense exceeds this limit, the employee seeks coverage from the health insurance marketplace and the employee receives a subsidy, the employer could pay a $3,000 penalty for each employee in this situation. For most employers, this provision will affect them at their first renewal in 2015.

These employers should be monitoring variable hour workers, minimum value and affordability provisions to ensure they are in compliance. There are many variables to measuring these criteria that go well beyond this article. The actual calculation usually requires a full analysis by a competent employee benefit consultant.

EXPANSION OF THE EMPLOYER MANDATE Transition relief delayed the implementation of the employer mandate until 2016 for most 50+ employers. (There is certain criteria employers are required to meet to obtain this relief. If you are unsure if you qualify, please contact your employee benefit advisor.)

With transition relief, the employer mandate expands to employers with more than 50 FTE employees in 2016. These employers will be required to ensure all full-time employees (30+ hours a week) are offered coverage, that this coverage is at the bronze level and that it is affordable. If they do not, they will be open to the same penalties the 100+ employer faced in 2015. Now is the time to address these provisions to make sure you will be in

compliance.

EMPLOYER REPORTING Sections 6055 and 6056 of the ACA require all applicable large employers (ALE) to report information to the U.S. Internal Revenue Service (IRS) on Forms 1094 and 1095 relating to their health plans beginning in 2015. An ALE is any employer with more than 50 FTE employees. These reports are not due until early 2016, but will report upon 2015 information. The report will determine if employers are offering minimum value and affordable coverage. In addition, this information will be used to determine an employee’s eligibility for subsidy. Table 1 explains the purpose, responsible party and filing deadlines of these forms.

CADILLAC TAX In 2018, plans that offer benefits with that cost more than $10,200 for individual coverage or $27,500 for family coverage will be required to pay a 40 percent excise tax on premiums above this amount. There has been much debate on this issue, as it is not related to benefit richness but is cost driven (e.g. a poor risk or older group could have high rates and a plan with modest benefit levels). Nonetheless, it is a current provision of the ACA and employers need to be aware of its potential impact as they strategize and plan for 2018.

It may be helpful to run projections now to determine the likelihood of this tax affecting plans. Early planning may eliminate drastic benefit changes later.

DISCRIMINATION TESTING The ACA expanded discrimination testing to fully insured plans, but this portion was delayed in late 2010 and has yet to be enforced. The provision essentially disallows contribution structures, which favor highly compensated employees. Until its delay, discrimination testing was creating significant issues for employers who had different levels of contributions for employee classes. The

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penalty for non-compliance was $100 per day for each affected individual. I expect this provision to return in the future, at which point affected employers may need to adjust their contribution approaches to become compliant.

SUMMARY The ACA has had a large impact on businesses and individuals over the last five years. While there are many details that go beyond the limits of this article, please reach out to me if you have specific questions relating to your organization.

When it comes to the ACA, my advice is to fully analyze your situation and then maximize your positioning. There are activities you can undertake to manage your situation now and in the future. Never has there been a time where is it so important that you seek help from qualified employee benefit advisors. The complexity that has now become a part of the health insurance purchasing decision warrants more analysis and better advice than ever before. To ensure you are positioned well now and prepared for the future, you and your organization will need to seek answers and options. n

BRIAN MARKS, CEBS, is executive director of VSCPA Benefit Advisors, which provides employee benefit advisory services to VSCPA members and their organizations. He is also a principal with Digital Benefit Advisors and has more than 20 years of experience in the insurance industry. bmarks@digitalbenefitadvisors.com digitalbenefitadvisors.com/vscpa

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ACCOUNTING

The Future of Revenue Recognition

BY GARY DITTMER, CPA

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How does your company recognize revenue? Based on new standards, the next few years will bring major changes.

On April 1, 2015, the Financial Accounting Standards Board (FASB) voted to delay the effective date of Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers, and on April 29, 2015, FASB issued a proposed ASU that would delay the effective dates of ASU 2014-09 by one year; public comments were to be submitted by May 29, 2015. The implementation dates differ for public and private companies and are as follows: Public companies: Annual reporting periods beginning after Dec. 15, 2017, and interim dates within that year.

This means a calendar-year public company would be subject to this new pronouncement on Jan. 1, 2018.

Private companies: Annual reporting periods beginning after Dec. 15, 2018, and interim dates within that year.

This means a calendar-year private company would be subject to this new pronouncement on Jan. 1, 2019.

In issuing this ASU, FASB created a new Topic within the Accounting Standards Codification (ASC) for Revenue Recognition: 606.

Topic 606 is comprehensive and combines most previously issued standards that were segmented by industry or specific situation into one standard. It applies to all entities that enter into contracts with customers to transfer goods or services, except it does not apply to insurance contracts, leases, financial instruments and certain nonmonetary exchanges (see paragraph 606-10-15-1 of Topic 606). That means this new ASU will apply to most businesses. While the effective date is a few years out, it deserves your immediate attention to plan for required

changes your clients or your business will have to make.

The new update consists of the following sections: >> Section A: Revenue from Contracts with Customers: Amendments to existing ASC >> Section B: Conforming Amendments Related to Revenue from Contracts with Customers: Amendments to the ASC

An approach that:

>> Section C: Background Information and Basis for Conclusions The ASU is available from the FASB website at fasb.org along with information regarding the Joint Transition Resource Transition Group, which consists of FASB and International Accounting Standards Board (IASB) personnel. The website describes this group’s role as to solicit, analyze and discuss stakeholder issues arising from implementation of the new guidance.

WHY CHANGE REVENUE RECOGNITION STANDARDS? There is a movement underway to converge accounting standards between the United States and the rest of the world. The FASB and IASB are cooperating in this effort, and changing revenue recognition standards is the product of that cooperation. We live in a global business environment and it is sensible to have comparable accounting standards and financial statements — regardless of where a company calls home.

Focusing on international convergence is

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a welcome shift for the FASB which, until the convergence movement gained traction, had been writing pronouncements that were “rules-based.” We are now moving toward “principles-based” pronouncements, thanks to the influence of our international brother and sister accountants. The difference is significant; the U.S. Securities and Exchange Commission’s Office of the Chief Accountant described principles-based standards1 as follows (edited for brevity).

•

a.

Is based on an improved and consistently applied framework,

b.

Clearly states the accounting objective of the standard,

c.

Provides sufficient detail and structure so the standard can be implemented and applied consistently,

d.

Minimizes exceptions from the standard, and

e.

Avoids the use of percentage tests that allow financial engineers to achieve technical compliance while evading the intent of the standard.

AN OVERVIEW OF THE NEW STANDARD In most instances, the new standard will modify the timing of revenue recognition.

Some industries, such as software, will see major changes as to when revenue is recognized, while others, like retail sales of “unbundled products” (which I’ll explain later), may experience little change to their previously released financial statements. u

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ACCOUNTING

The key is to realize this standard does not change the economics of the business — that is, cash flows are not affected, and in the end, cash is indeed king!

A key principle of this standard is that revenue should be recognized when goods or services are transferred to the customer who accepts the goods or services, and the customer is billed in an amount the seller expects to be paid.

The update creates a five-step model for recognizing revenue:

BONUS CONTENT In fall 2014, students in Intermediate 2 Accounting, a course at Virginia Tech taught

by John Brozovsky, Ph.D., researched how changes in revenue recognition will affect various industries. Visit vscpa.com/ RevenueRecognition to access their papers on these industries: >> Aerospace & defense

1.

Identify the contract(s) with a customer.

2.

Identify the performance obligations in the contract (called deliverables in prior pronouncements).

3.

Determine the transaction price.

4.

Allocate the transaction price to the performance obligations in the contract.

5.

Recognize revenue when (or as) the entity satisfies a performance obligation.

>> Communications >> Film >> Health care >> Software

BUNDLED PRODUCTS AND SERVICES: COMPARISON TO EXISTING GAAP This is an area of complexity under present GAAP. What are a bundled product and services? Under present standards, these are referred to “deliverables” or “elements in a multi-element arrangement.”2 Under new Topic 606, they are called “performance obligations.” For example, a software company might offer its customers the following generic products and services: a.

Hardware

b.

Software

c.

Professional services

d.

One-year maintenance agreement

in advance with implementation and training (professional services) usually completed within 60 days.

Under present guidance, the entity would have to determine the stand-alone selling price of these goods and services using the following hierarchy:3 1.

Vendor-specific objective evidence (VSOE)

2.

Third-party evidence

3.

Best estimate

How would the entity recognize revenue under present standards? Let’s assume the hardware is “off-the-shelf ” and a market price can be estimated — usually insignificant.

Software is not custom. The maintenance agreement covers the first year and its price may be estimated based on a history of subsequent renewals. Professional services are never billed separately, because the company only uses its technicians to do installations and, when required, maintenance of existing installations. The conclusion would most likely be that there is no VSOE and little in the way of third-party evidence that leaves a best estimate (which is generally not allowed for software). Therefore, most of the revenue would be deferred and recognized over the one-year maintenance period.

Under the new standard, the VSOE requirement is eliminated. Generally, revenue recognition will be accelerated and most likely recognized when the product is installed, tested and accepted. The maintenance revenue would be deferred and recognized over the maintenance period.

A CHALLENGING TRANSITION There are two options to transition to the new standard: 1.

Retrospectively to each prior reporting period presented, or

2.

Retrospectively with the cumulative effect of initially applying this update

Let’s assume the total cost is $100,000, payable

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I would not advise early adoption because this complex standard requires careful study. recognized at the date of initial application.

Either option is costly and time consuming, and could be interpreted as suggesting a complete review of all past contracts to derive the restated amounts. Except for the smallest organizations, this approach is impracticable.

I suggest sampling would be more efficient and less costly. Clients and auditors will have to agree on an approach that accomplishes the goals of the standard.

The initial release did not allow for early adoption; however, the April 29 issuance allows both public and nonpublic organizations to adopt the standard early — but not before the original public organization effective date (annual periods beginning after Dec. 15, 2016).

I would not advise early adoption because this complex standard requires careful study to determine the financial statement effects, determine which retrospective method you should adopt and develop an implementation plan for your organization.

The implementation complexity reminds me of when FAS 96 (Accounting for Income Taxes) was introduced in December 1987. FAS 96 replaced APB 11 and required scheduling of reversals of temporary differences, which is very time consuming to prepare and audit.

I’m sure the early adopters were frustrated when FAS 96 was reconsidered due to user complaints regarding complexity and FAS 109 (Accounting for Income Taxes) was issued during February 1982 as a replacement. This new standard did not require scheduling of reversals of temporary differences and was well received. Sometimes it is better to wait.

DEVELOP AN IMPLEMENTATION PLAN While I like the idea of a shift toward principles-based standards, this standard

is going to be challenging to implement because it is lengthy (more than 700 pages online), complex, introduces new terminology and applies to all organizations (with few exceptions) that enter into contracts with customers.

Organizations should consider the sources of data necessary for analysis, consider how to analyze contracts (sampling techniques) and decide whether systems are in place to produce meaningful reports to aid in computing retrospective amounts and disclosures. Auditors and clients will need to coordinate to chart an economically feasible course.

1. “Study on the Adoption by the United States Financial Reporting System of a Principles Based Accounting System,” sec.gov/news/ studies/principlesbaeddstand.htm.

2. “Understanding Revenue Recognition Changes to U.S. GAAP,” American Institute of CPAs, New York, NY, 2014 p. 9.

3. IBID, p.18.

GARY DITTMER, CPA, CMA, CGMA, is

TAX IMPLICATIONS While the tax effects of changing the method and timing of recognizing revenue will most likely result in an accounting change for income tax purposes and require the filing of a Form 3115, each company will have to evaluate their facts and circumstances and adopt a tax-filing strategy. Before changing a method of accounting, taxpayers must obtain the consent of the commissioner under Code Section 446(e). For some changes, the consent is automatic, while for others it is not automatic and consent will be decided on a case-by-case basis. The U.S. Internal Revenue Service (IRS) updated the consent procedures in Revenue Procedure 2015-13 (Methods of Accounting — Automatic and Non-Automatic Consent Procedures).

the senior tax director for USA Mobility, Inc., in Springfield. He is an adjunct professor at George Mason University and the University of Virginia School of Continuing and Professional Studies, where he teaches taxation. gdittmer@comcast.net connect.vscpa.com/GaryDittmer

RESOURCES The American Institute of CPAs (AICPA) issued an alert, “Understanding Revenue Recognition Changes to U.S. GAAP,” and also produced a webcast on the subject. Both are accessible in the AICPA store at cpa2biz.com.

I’m sure as the year unfolds there will be live seminars covering this important topic. n

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Attention CPAs:

Whether A Decision Maker Looking To Upgrade Your Talent, Or A CPA Looking to Upgrade Yourself/Your Skills, Ask Yourself: Who really chose who in joining your company?

Are you/your professional staff really at the right level where you should be/you need them to be?

Are you/your staff in a position that truly suits your/their personality, values, and professional and personal needs?

Why leave your future to chance?

If you’re seriously interested in making the “right” move for your next hire, I can help you.

I am an actively licensed CPA in Maryland and Virginia with over 20 years of experience including public accounting (E&Y) and consulting (KPMG), financial accounting (American Cancer Society), internal audit (Moneyline Telerate), and recruiting (Acsys, formerly Don Richards). As a networker who truly enjoys helping others and sharing my career experiences to guide fellow professionals, here is how I can help you: Decision Makers:  Ask you questions, and most likely ask many more questions than other recruiters about your company, duties involved, skills required, corporate culture and more  Work with you on finding the “right” professional that is the “right fit”  Provide you with valuable information about the professionals I work with, the marketplace, what your competitors pay, and more Career Seekers:  Guide you on career paths available in public accounting and industry  Enable you to capitalize on your strengths  Coach you on how to put your best foot forward to find the “right fit”  Advise you when to stay in your current position if that is the right move If you’re interested in working with a recruiter who understands your background, skills, and is genuinely interested in helping you find the “right fit”, then I welcome meeting you!

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Phone: 301-767-0670 Email: BethABerk@msn.com

Specializing in CPA Firm, Accounting & Finance Positions in Metropolitan DC & Nearby Suburbs/Baltimore/Richmond/Tidewater Connecting You To Your Next Hire

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matching skills, experience & values with needs Serving clients and professionals as an Independent Recruiter since March 2005

VSCPA news

f:

M

s

2015–2016 Board of Directors

YOUNG PROS >>

Come mix and mingle!

Join the VSCPA later this summer for our Young Professional Mix & Mingle networking events. Come solo, bring a friend or bring the entire gang from the office to connect with fellow young professionals of the Virginia Bankers Association, Virginia Bar Association and Independent Insurance Agents of Virginia. Visit vscpa.com/networking for more information and to register.

Left to right: Dian Calderone, CPA; Staci Henshaw, CPA; Jennifer Duff, CPA; Tara Adams, CPA; Richard Groover, CPA; Jill Mitchell; Gary Thomson, CPA; Jaime Lynn Dernar, CPA; Jim Phillips, CPA; Stephanie Peters, CAE; Marc Filer, CPA; Victoria Jones, CPA; Mike Wagner, CPA; Lisa Germano, CPA; Bill Hardy, CPA; Henry Davis III, CPA. Not pictured: Brad Haun, CPA.

CHAIR Lisa Germano, CPA CHAIR-ELECT Jim Phillips, CPA VICE CHAIRS Marc Filer, CPA Staci Henshaw, CPA Victoria Jones, CPA Gary Thomson, CPA

BOARD OF DIRECTORS Tara Adams, CPA Dian Calderone, CPA Henry Davis III, CPA Jaime Lynn Dernar, CPA Jennifer Duff, CPA Richard Groover, CPA Bill Hardy, CPA Brad Haun, CPA Jill Mitchell Mike Wagner, CPA

>> Aug. 6: Casa Del Barco in Richmond, 5:30 – 7:30 p.m. >> Aug. 27: The Yard House in Virginia Beach; 5:30 – 7:30 p.m. >> Sept. 3: Gordon Biersch in Tysons Corner; 5:30 – 7:30 p.m. n

VSCPA PRESIDENT & CEO Stephanie R. Peters, CAE

>> WE WANT TO HEAR FROM YOU!

THANK YOU, 100% FIRMS!

Email disclosures@vscpa.com if you have exciting news to share. The VSCPA prints news of members’ awards, appointments and promotions,as well as new hire and job change announcements. n

Due to space constraints, the list of VSCPA 100% Member Firms has been omitted from this issue. A 100% Member Firm is simply a Virginia CPA firm or company that has all of its CPAs enrolled as members in the VSCPA. These firms show their commitment to their employees, the profession and the association.

Check www.vscpa.com/100Percent for a complete, up-to-date list.

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VSCPA news MOVERS AND SHAKERS >>

Top 5 Under 35 really involves a variety of different facts and services,” he said. “We don’t have many recurring clients, so you really get to learn a new client and industry on every engagement.

Each engagement is an introduction to a new industry or a new issue that you might not have encountered before.”

Burns is an avid golfer and exercise buff. But he devotes most of his non-work time to his family — he and his wife, Sarah, welcomed their first child, Olivia, last year.

“Parenthood is one of the most challenging things I’ve ever done in terms of patience with an infant,” he said. “But it’s probably the most rewarding as well.”

BRYAN CAMPBELL, CPA Aaron Peters, CPA; Kim Ruiz, CPA; Brian Deibler, CPA; Bryan Campbell, CPA; Brian Burns, CPA

There’s potential for great

collaboration and great confusion with the 2015 Top 5 Under 35. Four of the five winners work for two companies, albeit in different offices in one case. And if you get them in a room and ask for Brian, three of them will turn around, although one spells his name with the “Y” variation.

The other quality these five rising stars have in common? An intense dedication to the profession and the communities where they live and work.

BRIAN BURNS, CPA SENIOR MANAGER, DIXON HUGHES GOODMAN, GLEN ALLEN Brian Burns has a career story you’ve heard before. The senior manager in Dixon Hughes Goodman’s (DHG) forensic and valuation services practice didn’t go to school looking to become an accountant. But once he found

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out how the credential could help his career, he was all in.

Burns, 31, initially thought about law school after completing his bachelor’s degree in finance at Virginia Tech. He accepted a job in the valuation practice at Keiter Stephens (now Keiter) in Glen Allen, then decided that an accounting certificate would help him advance in the field and enrolled in night school at Virginia Commonwealth University.

“It just seemed to make sense to have that background and have the CPA credential,” he said, “just because it carries so much weight, particularly in disputes if you’re trying to qualify as an expert witness.”

The Texas native came to DHG in 2014 and cites the day-to-day variety in his work as the most satisfying aspect of his job.

“One of the best aspects of it is that each case, while they can have similar issues,

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SENIOR MANAGER, DIXON HUGHES GOODMAN, NORFOLK Bryan Campbell is nothing if not a collaborator. When he found out he’d won a Top 5 Under 35 award, his first thought was that he would be accepting on behalf of around 30 people who had helped him in his career. That’s why he’s so focused on bringing people together to better the Hampton Roads community.

Campbell, 31, started an initiative called Innovate NVB (the acronym stands for Norfolk/Virginia Beach) to spur creative thought within Tidewater-area accounting professionals. The group brings together area professionals with the goal of enhancing the local business community. The only rule: no pens and paper.

“We’re doing that all day,” he said. “So I have mini chalkboards and sidewalk chalk, and that’s what people have to use.”

Community involvement has been a staple of Campbell’s life since he moved to Norfolk after earning his bachelor’s degree from the University of Mary Washington. He is

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president of the Business Consortium for Arts Support and previously served as vice president of Toby’s Dream Foundation, and he earned his master’s in business administration from Old Dominion University along the way.

In addition to his financial acumen — he’s the third CPA in his family — he also tries to enhance those organizations with out-of-thebox thinking.

“I think that the CPA is such a great profession and a well-respected designation that once you have it, it’s immediate credibility,” he said.

“I think a lot of organizations need that, and CPAs can bring such awesome insights to various community boards, to help them as they’re trying to accomplish their goals, not just with numbers, but to think differently.”

Campbell credits much of his mindset to a previous boss, Bill McCormick, who hired him in college to work for his company, DS3 Data Vaulting. He jumped into that job with both feet and is especially happy he had the chance to get the responsibilities he had at such a young age, which prepared him to give meaningful advice to his clients.

“I got to sit in incredible meetings I always felt overwhelmed in, which is a good position,” he said. “…Where else can you go work that you get to go right out of school, be 22, 23, 24 years old and get to talk to CEOs at companies and have them ask you your opinion?”

People are still seeking Campbell’s opinion, but he’s discovered he can be more effective by hearing what they have to say. “People are calling you in a constantly changing business and economic climate,” he said. “There are always new things going on, new ideas, and if you can be a really good listener, you will open up so many doors.”

accounting and tax services to around 400 small businesses in the Washington area.

A family medical issue (thankfully, since resolved) forced Deibler, 34, to pull up his stakes and move back to his native Hampton Roads and into a position in private industry.

He’s now back in public, and he says his skills are all the better for the detour.

“A lot of businesses can’t afford to go out and use a big accounting firm, so we cater to that,” he said. “Giving a high level of service and a true professional look, from an accounting perspective, at a rate a lot of small businesses can afford.”

“Really seeing what businesses who now are my clients, what they deal with on a dayto-day basis,” he said when asked about the benefits of his stint as CFO and controller at Bluewater Yacht Sales in Hampton.

“Insurance, worker’s comp, payroll every two weeks. Really getting into the details on how companies operate has put me in a better position when I’m meeting with clients and advising them. I know what they go through on a daily basis, and that’s a huge benefit.”

Peters, 33, is uniquely positioned to understand the accounting needs of a small business through his experience at LivingSocial. He started at the company in late 2011, when it was in a period of major growth fueled by an investment from Amazon.

Deibler spent three years honing his skills at Bluewater before an opportunity to move back into public presented itself in the form of a job offer from Malvin Riggins. He moved over in 2012 and has been there ever since.

Further filling Deibler’s plate are his responsibilities with the VSCPA, including a spot on the VSCPA Educational Foundation Board of Directors and his new position as president of the VSCPA’s Tidewater Chapter.

It’s the latest evolution in a career that has taken twists and turns since Deibler decided to study accounting at Radford University. He followed in the footsteps of his older sister, Tracy Tingen, CPA, at Radford and Malvin Riggins.

Deibler and his wife, Ruth, have a son and a daughter, and he’s starting to get involved in coaching his son’s tee-ball team. They also like to spend time outside hiking and camping.

SENIOR TAX & ACCOUNTING MANAGER, MALVIN, RIGGINS & CO., NEWPORT NEWS Brian Deibler thought he had his public accounting career right on track when he moved to Charlottesville firm Garris & Co. in 2009. Then life intervened.

CORPORATE CONTROLLER, LIVINGSOCIAL, WASHINGTON While Brian Deibler bounced between public and industry, Aaron Peters has found a way to keep a toe in both. In addition to his day job as the corporate controller at online marketplace LivingSocial, he and his wife, Meghan, run their own practice providing

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Peters has indulged that interest in politics through his VSCPA volunteer work. He spent time on the CPA PAC Steering Committee and the Legislation Review Task Force before taking a step back when he joined LivingSocial.

Through it all, he’s burnished his industry credentials while still keeping a toe in the world of tax through his side business. And in addition to the growth and divestment in LivingSocial, his own family has gone through some growth of its own — he and Meghan welcomed a son at the beginning of the year.

Peters is an avid baseball fan and has season tickets at Nationals Park. He also enjoys travel, although that’s gotten more difficult with a young baby in tow. And they stay close (and busy) through their tax work.

AARON PETERS, CPA BRIAN DEIBLER, CPA

LivingSocial has since dialed back that growth, pulling out of most of its international markets and holdings. It’s been a learning experience for Peters, a Wisconsin native who moved to Washington after graduating from Marquette University in Milwaukee in part to satisfy his interest in politics and government. He started his career at PricewaterhouseCoopers, where he met Meghan, before moving over to LivingSocial.

Turn to page 29 to read about Kim Ruiz, CPA, the final Top 5 honoree.

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Meet your chair: Lisa Germano, CPA moved to Virginia after accepting a job with Musselman & Associates, a Charlottesville firm that allowed her to take advantage of her unique combination of skills.

That firm was also where Germano met Debbie Coyner, CPA, a fellow VSCPA member who had a hand in both of Germano’s longtime businesses.

“They had a unique practice,” Germano said. “Both Bob and Carolyn, husband and wife, were attorney CPAs. Carolyn ran the accounting practice in one building and Bob ran the law firm in another building, and there was a parking lot in the middle. I was hired as an associate in the law practice, but Debbie was housed in the accounting practice, and they put me in an office across the hall from her.”

As a licensed CPA and attorney,

2015–2016 VSCPA Board of Directors Chair Lisa Germano, CPA, is well versed in the importance of experience and expertise. Now she’s focusing on the importance of volunteering not only as a way to give back to the profession, but also a way to build both of those qualities with the help of others.

“I don’t know that I could be the best advisor to the clients that we have today without the collaborative effort of people I’ve met over the years,” she said. “It’s just been a blessing to have met the people that I have and have so many mentors. Half of them probably don’t realize that they’ve mentored me over the years. You take a little bit from one person and a little bit from another person. I think that’s what you do as you volunteer. You really observe the people that you’re working with.

There’s so much to be learned if you listen. That’s what volunteering has done for me.”

It was the advice of one of those mentors that led Germano to the accounting profession in the first place. She had majored in accounting at Iona College in New York, but did so with no intention of making it her career.

“I didn’t want to be an accountant,” she said. “I didn’t think that I could sit and do spreadsheets for the rest of my life. That’s the way I envisioned my accounting career would be.”

She then attended law school at Ohio Northern University, where she met the mentor who put her back on the accounting path, Prof. Louis Lobenhofer. Following Lobenhofer’s advice, Germano sat for the CPA Exam, passing three parts on her first go-round while still maintaining a full law course load. She passed the Exam on her next attempt and

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True to Germano’s mentoring mindset, the pair had a profound influence on each other. Coyner was the one who told Germano about the retirement-plan job opening that led to the formation of Actuarial Benefits & Design Company (ABD), the Midlothian employee benefits practice that consumes most of her time. And Germano encouraged Coyner to attend law school, leading the pair to found Coyner & Germano in 1987.

That firm continues to exist, with the Charlottesville-based Coyner doing most of the heavy lifting. Germano runs a small tax practice through the firm, maintaining a small group of longtime clients.

Germano founded ABD in 1989 and cites that tax practice as a big reason why she’s able to stay abreast of the latest tax developments.

“I didn’t want to be a law firm and I didn’t want to be a CPA firm,” she said. “I couldn’t get my head wrapped around being either one, and I had a choice. Either one of them would have been a professional practice. But what we were doing was so unique and so boutiquelike that I thought we should just be a regular corporation, but treat ourselves like were a professional corporation.

“That’s the foundation for everything that we do here. We act like we’re a CPA firm in our ethics and our internal procedures and how we work with our clients. But we’re not licensed as either one.”

With such a small firm in a niche practice area, it would be easy for Germano to hole up and focus on her own work. But her social nature won’t allow that, and she has embraced volunteering through the VSCPA, the American Institute of CPAs (AICPA) and the Virginia Bar Association as a way to expand her network and expertise.

“We’ve all kind of morphed into our own little areas over the years,” she said. “You kind of start out as a general practitioner, and you figure out what your passion is, where you might feel more affinity. It’s really cool

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to look back and know people for as long as we have and see how we’ve all progressed. Back then, we were wondering, ‘What are we doing?’ It’s really fulfilling to know that any question a client of ours might have that we don’t have the expertise here for, we can pretty much get them the expertise.”

As VSCPA chair, Germano hopes to bring that kind of influence to the VSCPA’s younger members.

“That mentoring, from someone who’s been there, done that — maybe not in your shoes, but in similar shoes — has the ability to give people permission to be a little more bold in their thinking, in their innovation and how they communicate what they really want or need.”

Growing up in Mamaroneck, N.Y., Germano envisioned a life of commuting into New York and joining the business community.

While completing a law school program in England, she met a young Irishman named Larry Lawless who led her to change her plans.

“I always thought that ... I’d be working in New York City, and then I met Larry, and he did not like that fast pace. He couldn’t imagine me doing that. He didn’t want to do that.

“I was never going to get married. I was never going to have kids. Now I have a husband I’ve been married to for 33 years and two kids in college. Never say never.”

New York was too fast-paced for Larry, who liked the rural landscape around Ada, Ohio, where Germano was in law school. Virginia provided a workable compromise.

See the rest of the Top 5 winners on page 25.

KIM RUIZ, CPA SENIOR MANAGER, LIVINGSOCIAL, WASHINGTON Rounding out the Top 5 Under 35 is the second LivingSocial representative. Kim Ruiz is the company’s senior manager for indirect tax, which allows her to focus on her interest area of state and local taxation. And while LivingSocial isn’t the international behemoth it once was, there are still plenty of technicalities in different states and localities to keep her busy.

“There are a lot of intricacies with state and local tax,” she said. “Not only are there a bunch of taxes, but all the other states have different interpretations of everything. There are a lot of different things to keep you intrigued.”

Ruiz, 34, didn’t even enter school with the intention of becoming an accountant. The Cleveland native originally planned to become a physical therapist, but an application mix-up prevented her from getting into that program at Duquesne University in Pittsburgh. Accounting was where she landed.

Before joining LivingSocial in 2014, Ruiz worked at SC&H Group, a regional accounting firm in McLean. She focused on Virginia taxes there before switching jobs at the behest of a former coworker.

But as flexible as Germano has been in developing her career, she’s stayed true to herself. She credits that to the influence of her grandparents, who emigrated from Italy to New York to build a life for themselves.

She makes use of her interest in taxation as a member of the VSCPA’s Tax Advisory Committee. She previously volunteered on the VSCPA’s Young Professionals Advisory Council and on a taxation committee at the American Institute of CPAs (AICPA). For her, the Tax Advisory Committee is a way to stay engaged with her professional specialty.

“My grandparents really taught me to be happy with who you are,” she said. “Don’t ever forget your roots. Not ever forgetting your roots is so important. We have the blessings of getting so many of the things we strive for in life. We can’t forget why we wanted them and the fire in our belly.” n

“I did the AICPA State & Local Tax Committee for maybe a year, but I thought it would be more beneficial to help on the Virginia side,” she said. “It’s good to stay in touch with the changes and know if something comes up. It’s really neat to be part of a group that has that kind of influence.”

In addition to spending time with her husband and son, Ruiz is a fitness buff. She taught Zumba classes before her son was born and enjoys bicycling. But her true passion is dance, her main interest as a child.

>> CONTACT LISA Lisa@ab-d.com @LisaGermanoCPA connect.vscpa.com/LisaGermano

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Ruiz, whose family comes from Eastern Europe, started with Croatian line dancing when she was 5 years old, and she performed with an Eastern European folklore ensemble at Duquesne. n

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VSCPA news A COMMUNITY LEGEND >>

Member of the Year: John Renner, CPA Committee for the past decade and currently serves as chair. He’s a vice president of the Northern Virginia Community College Foundation and a member of the Alexandria Rotary Club’s board of directors.

He’s president of the board at Ivy Hill Cemetery and serves on the Accounting Advisory Committee at his alma mater, Virginia Tech.

Despite all his investment in Alexandria, what many don’t know is that Renner wasn’t actually born in the city, but across the border in Arlington.

“Everybody thought I would never move out of Arlington,” he said. “I was entrenched in Arlington. I grew up in Rosslyn before it was what it was today. Rosslyn was the pawn shops and the gravel pit and the construction yards. It was a playground my mother didn’t know much about. “

Step into the conference room at

Renner & Co. in Alexandria and you’ll probably do a double take. In the corner, there’s a cutout of the firm’s founder, John Renner, CPA, and it’s not the only one in the office. Renner’s colleagues joke about using the cutout for public appearances when the man himself is just too overscheduled.

Like any good joke, it’s funny because it has the ring of truth. Renner is Mr. Alexandria — when the VSCPA visited Renner & Co. to get material for this profile, Bill Euille, the city’s mayor, carved out time to stop by and offer a few words. It’s that kind of civic involvement and dedication to the profession that makes Renner the VSCPA’s 2015 Outstanding Member of the Year.

Renner’s CV — along with that of his wife, fellow Renner & Co. partner and VSCPA member, Joan — could double as a refresher course on the major players in the Alexandria community. The couple’s joint highlights include being honored as Living Legends of Alexandria in 2010, Rotarians of the Year in 2009 and the only husband-and-wife duo to have both served as chair of the Alexandria Chamber of Commerce.

But that’s just scratching the surface of John Renner’s devotion to his city, his company and his profession.

“His passion for the city and for the citizens is just remarkable,” Euille said. “He probably is more engaged and attends more community events than I do as mayor, and my schedule is full 24/7.”

Renner has been on Alexandria’s Budget and Fiscal Affairs Advisory

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After graduating from Virginia Tech, Renner returned to Arlington to accept a job with Murray, Jonson & White. He made the move to Alexandria in 1978 to work for Minter, Morrison & Grant, and he never left.

“It gets into your blood,” he said. “…I just enjoy giving back to the community. I have a hard time saying no.”

Renner got involved in VSCPA volunteering early in his career after meeting Tom Berry, then the Society’s CEO. He started off with the VSCPA’s Northern Chapter, then moved on to chair the Public Relations Committee before working with the Legislative Affairs, Professional Ethics and Professional Development Conference Planning committees.

He also spent three years on the VSCPA Board of Directors and, more recently, spent a year on the VSCPA Educational Foundation’s Board of Directors.

That last volunteer gig aside, Renner mostly stepped away from VSCPA volunteering in the mid-1990s to focus more on his local projects.

“I got involved in the civic things because the city was so good to us,” he said. “When you give back to people who help you, it comes back to you in spades.”

His giving back doesn’t end with those charitable endeavors. A significant portion of his firm’s business comes from nonprofits, and they do those audits at a discount rate. And Renner also stresses putting non-accounting-savvy clients at ease with understandable explanations of financial issues.

“We may be calling something by a technical term. The client might be talking about something else, and everyone has a deer-in-headlights look,” he said. “You have to listen and try and figure that out.”

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Recently, that has taken the form of dealing with Alexandria’s high business and professional license (BPOL) tax. As chair of the city’s budget committee, Renner is tasked with explaining the ins and outs of the BPOL tax to an audience of laymen, but he downplays the value of his expertise.

“I don’t walk on water,” he said. “If you know the numbers, listen to what somebody has to say and present the facts for what they are, you can convince people of a lot of things.”

Renner’s inspiration for his civic involvement largely comes from his father, also named John. The elder Renner was an electrical engineer and a World War II veteran who was heavily involved in the Rosslyn community.

His son also followed in his footsteps in a more unusual way — working with his wife.

“When I was in high school, my dad started his business and my mom went to work for him,” Renner said. “I said, ‘I’ll never have that. That doesn’t work.’”

Between the firm and their joint charitable efforts, the Renners spend a great deal of time together. It’s been a challenge to keep love and business separate, but the pair has managed to pull it off and remain close.

Renner & Co. was founded as Renner, Kositzka & Wicks in 1983. The firms split in 1989, and John and Joan were coworkers before they were husband and wife. He’s proven to be as caring a husband as he is a community member.

“He’s so thoughtful that I have to be careful not to ask him for things unless I really want him to go get them,” Joan said. “He picks up on things. He realizes that I need something before I even do.”

The common thread in all of Renner’s endeavors is his complete devotion to the cause. Whether it’s his family, his employees or his community work, he jumps in with both feet and gives his all to help make things better.

“He gives tremendous support to, and advocacy for, Alexandria’s small businesses,” said Val Hawkins, former president and CEO of the Alexandria Economic Development Partnership. “He’s a huge supporter in the nonprofit sector of our community. The bottom line is: John Renner cares, and does something about it.”

Watch Renner’s colleagues talk about his accomplishments at youtube.com/watch?v=DOvHREpqzkI. n

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“I got involved in civic things because Alexandria was so good to us. When you give back to people who help you, it comes back to you in spades.”

— John Renner, CPA

>> 40 YEARS AND COUNTING: NEW VSCPA LIFE MEMBERS The VSCPA welcomed 41 members to the ranks of Life membership, given to those who have been VSCPA members for at least 40 consecutive years, at its Honors & Awards ceremony May 11. Only 461 members have received the honor in VSCPA history. The following members earned Life member status in 2015: n ANTHONY BARONE, CPA WALTER BERRY, CPA PAUL BLACKMER, CPA LOUIS CARR, CPA LINDSEY CLEM, CPA TERRENCE CLEM, CPA RICHARD CRABBS, CPA GARY DITTMER, CPA GARY DUERK, CPA ROBERT FALK, CPA IRVIN FARMER, CPA JOHN HART, CPA RAY HESKETT, CPA THOMAS HICOK, CPA CLIFTON INGRAM, CPA JESSE JONES, CPA DAVID KUDRAVETZ, CPA MICHAEL LUCZKOVICH, CPA WILLIAM MALONE, CPA DANIEL MARTIN, CPA MICHAEL MEEGAN, CPA

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FRANK MITCHELL, CPA GREGG MODESITT, CPA ROBERT MOORHOUSE, CPA MARSHALL NORTHINGTON, CPA BENJAMIN PLEASANTS, CPA WILLIAM ROBINSON, CPA CALVIN ROSEBERRY, CPA VIVIAN SALE, CPA ROBERT SCHUTRUMPF, CPA OSCAR SHELTON, CPA ROBERT SHULTS, CPA NORMAN SITES, CPA LESLIE TAYLOR, CPA MICHAEL THOMAS, CPA WILLIAM TROYER, CPA FRANK WADE, CPA WILLIAM WHITFIELD, CPA ROBERT WITHROW, CPA MEREDITH WOOD, CPA TERRY ZERWICK, CPA n

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Congratulations to the following members!

Center for Audit Quality and the Auditing Section of the American Accounting Association for the Access to Audit Personnel Program.

RAVEN MCGRIFF, a student at Virginia State University, received the 2015 Bert Smith & Co. Scholarship.

KEVIN REILLY, CPA, a partner at PBMares in Fairfax, has been named Tax Consultant of the Year by The BoardRoom Magazine as part of its 2014 “Excellence in Achievement” awards.

FIRM NEWS >>

Brenda Curtis, CPA, Connie Hammell, CPA, Brent Simer, CPA

NEW HIRES >> DANIELLE CHAMBLISS has joined Allmond & Co. in Landover, Md. BRENT ROBERTSON, CPA, has been appointed as county administrator in Franklin County.

TIMOTHY ROSS, CPA, has joined CohnReznick as a partner in the Tysons Corner office.

Fairfax firm MURRAY, JONSON, WHITE & ASSOCIATES has changed its name to MJW. Richmond firm WELLS, COLEMAN & CO. has changed its name to WELLSCOLEMAN. n

BRENT SIMER, CPA, has joined Ernst & Young in McLean as a senior manager of assurance services in the firm’s quality and regulatory matters practice.

We mourn the loss of...

PROMOTIONS >>

DON COLEMAN, CPA, a VSCPA life member from Glen Allen.

BRENDA CURTIS, CPA, and CONNIE HAMMELL, CPA, have been named principals at Kositzka, Wicks & Co. in Alexandria.

CATHY LILES, CPA, has been named senior vice president and chief financial officer of Carter Bank & Trust in Danville.

ERICA ROQUE, CPA, has been named principal at Halt, Buzas & Powell in Alexandria.

APPOINTMENTS & AWARDS >> ED AMOROSSO, CPA, managing partner at McPhillips, Roberts & Deans in Norfolk, has been named King Neptune, the ceremonial leader for this year’s 42nd annual Neptune Festival in Virginia Beach.

MONET GRAVES, a student at Virginia State University, received the National Capitol Central Maryland Chapter of the National African American Insurance Association’ 2015 scholarship.

ROGER MARTIN of the University of Virginia, along with two coauthors, had his proposal, How Does Evidence Specificity in Auditors’ Look-Back Analysis Affect Auditors’ Planning Judgments?, chosen by the

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DIXON HUGHES GOODMAN was honored as one of the top 20 companies for corporate philanthropy at Richmond BizSense’s Generosity, Inc. event.

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DAVID LAJOIE, CPA, of Suffolk. He ended his career as the CEO of BurgerBusters.

JOHN SFARNAS of Woodstock. He was a graduate of the University of Central Florida, Barry University and Case Western Reserve University.

JACK WRIGHT, CPA, a VSCPA life member from Roanoke. A partner at Anderson and Reed, he served on the VSCPA Board of Directors and president of the Society’s Roanoke chapter. He also served as president of the Roanoke Estate Planning Council and on the boards of the Salvation Army of Roanoke and the Foundation for Roanoke Valley. He was a member of First United Methodist Church in Salem, where he served in several leadership positions. n

FIND THE CPE TEST ONLINE Visit www.vscpa.com/public/catalog. Choose the “On Demand” tab to find the exam and others from previous Disclosures issues.

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Staff news

SAVE THE DATE FOR CPA DAY OF SERVICE! CPA Day of Service is coming up! Cap a successful Virginia CPA Week by joining your colleagues in representing the CPA profession and making a difference in the community on FRIDAY, SEPT. 18.

Hundreds of CPAs and employees of accounting firms volunteer statewide each year as part of CPA Day of Service, working at volunteer locations for a variety of organizations and causes and including both indoor and outdoor projects.

Top: Rocio Gibbs; Molly Wash, CAE; Brenda Fogg, CAE; Darshae Dabney. Bottom: Beth Bickford, CPA; Laura Cobb; Zané Mullins.

Member Relations Coordinator ROCIO GIBBS celebrates 17 years with the VSCPA on Aug. 13. Career & Leadership Development Director MOLLY WASH, CAE, marks her 11th anniversary with the VSCPA on July 26.

Member Relations Director BRENDA FOGG, CAE, marks 10 years with the VSCPA on July 11. Regulatory & Legislative Affairs Manager DARSHAE DABNEY celebrates eight years with the VSCPA on July 9.

Vice President of Finance and Administration BETH BICKFORD, CPA, celebrates her sixth anniversary with the VSCPA on July 14. Member Engagement Manager LAURA COBB celebrates three years with the VSCPA on Aug. 6.

>> THE VSCPA’S NEWEST CPAs

Education Manager ZANÉ MULLINS celebrates her second anniversary with the VSCPA on Aug. 12. n

CAROLYN ADAMS-ROSSIGNOL JOHNNY AMIN LAURA CASCIO ANNA DUFF ANDREW DYER LIVIA EHARDT LISA HARRISON CHRISTINE HINES CHANTEL HOLLOMAN DANIEL MAUK JENNA MOEHRING HANNAH OAKES MITCHELL REID TRINETTE RIDDICK CHARLES ROYAL MARK SEVERSON NGOZI UGWU SHERRY WHITESELL

>> OPEN VOLUNTEER SPOTS Thanks to all the VSCPA members who have signed up to volunteer with the Society! We’re thrilled to have you on board representing the VSCPA and the profession in the community and determining the future direction of the Society Among the volunteer opportunities currently open are: • • • •

Disclosures Editorial Task Force Online Programs Planning Task Force Speaking & Community Engagement Ask a CPA Email Program

Visit vscpa.com/VolunteerSchedule to learn when you can sign up for your desired opportunity. n

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For more information, visit vscpa.com/DayofService or contact VSCPA Member Engagement Manager Laura Cobb at lcobb@vscpa.com. n

List from April and May. Compiled May 29, 2015.

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VSCPA news

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>> WHO’S WHO

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1.

Nidia Cruz, CPA, assists a Tidewater-area Girl Scout in counting change at the chapter’s financial literacy event in April.

2.

Greg Lawson, CPA, VSCPA Career & Leadership Development Director Molly Wash, CAE, Raven McGriff and Aaron Rawlings at the VSCPA Honors & Awards.

3.

Marshall Northington, CPA, and Larry Samuel, CPA, at the VSCPA Honors & Awards on May 11.

4.

Elsie Rose, CPA, and John Montoro, CPA, at the VSCPA PAC Breakfast on May 12.

5.

Art Auerbach, CPA, and “Thomas Jefferson” (Bill Barker) before their session at the Business & Industry Conference on May 12. n

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VSCPA educational foundation

Shapiro gets his shot as Foundation chair Shapiro has a wealth of experience as a VSCPA volunteer, moving onto the Society board in part because of his term as president of the VSCPA’s Northern Chapter. It’s part of the culture he inherited and tries to maintain at MJW, where firm founder Carl Jonson also served as chapter president.

He has tried to carry on that tradition by encouraging younger employees to get involved with the VSCPA and other industry groups.

“I’ve encouraged people at my firm,” he said. “One of my newer partners went through the Northern Chapter and was recently president. Trying to get younger people involved, that’s the way to do it — have the firm support it and have firm leaders committed to giving people the time and the resources to do it.”

Randy Shapiro, CPA, is in something

of a unique position entering his term as chair of the VSCPA Educational Foundation. Shapiro has sat on all three VSCPA boards — the Society and Educational Foundation Boards of Directors and the VSCPA Political Action Committee (VSCPA PAC) Board of Trustees — but he’s never been a VSCPA chair until now.

In addition to that wealth of board experience, Shapiro is also wellversed in raising money for the Foundation. He’s managing principal at Falls Church firm MJW, formerly Murray, Jonson, White & Associates, which established a Foundation scholarship in 2009 as part of its 50th anniversary celebration.

“We decided, as a firm, to go out to our clients in celebration of our 50th anniversary and raise $50,000,” Shapiro said. “Not knowing how successful we would be, the partners decided to fund the difference.

As it turned out, we had a great experience and raised roughly $75,000 within a matter of months. It was a really good outpouring from our clients.”

One of Shapiro’s major goals as Foundation chair is to oversee an uptick in firm giving, and he also wants to get the board together in the same room more often instead of relying on phone calls. But it’s also a learning experience for him as he adjusts to his first chair experience.

“I’ve been chair or president of different volunteer groups, and I think until you’re the actual leader, you can sit back, even as a vice chair, and not have the full responsibility,” he said. “Since busy season has ended, I realize that it’s here and I need to get my thoughts together, really produce and take a leadership role.”

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Shapiro got involved with the VSCPA soon after graduating from the University of Virginia McIntire School of Commerce. His favorite benefit from his extensive volunteer work, both with the VSCPA and outside of it, is the connections he’s made with colleagues across the Commonwealth.

“One of the things that I think I find is the networking and knowing people in the profession,” he said. “You don’t do all your networking to try to get clients. It’s networking to know people and be friends with associates.

“If I walk into a leadership conference, I’ll probably know a third of the people there and have crossed paths with them. On a professional level, I feel free and comfortable calling people throughout the state. It’s that camaraderie of knowing people.”

One of the Foundation’s main objectives is to protect the pipeline into the accounting profession. Shapiro aims to fulfill that mission by helping students defray the cost of education — something he says became more important when the 150-hour requirement to sit for the CPA Exam went into effect — and by emphasizing the diverse array of options within the profession.

“It’s a job that gets you talking to people, working with people,” he said.

“You’re not the guy in the green eyeshade working with numbers. You’re out there working with people, consulting and helping.” n

>> CONTACT RANDY rshapiro@mjwcpas.com connect.vscpa.com/RandyShapiro

HTTP://DISCLOSURES.VSCPA.COM

VSCPA educational foundation

Congrats, 2015–2016 scholarship recipients VSCPA GRADUATE SCHOLARSHIP ($1,000)

KEARNEY & COMPANY SCHOLARSHIP (2,500)

Trenton Walker of Charlotte, N.C., College of William & Mary

Isabella Hur of Fairfax, George Mason University

Kaylor Nichols of Chester, University of Virginia

McKenna Shirey of Mechanicsburg, Pa., Virginia Tech.

VSCPA MINORITY SCHOLARSHIP ($1,000)

MICHAEL E. MARES SCHOLARSHIP ($3,500)

Sarah Courtney of Forest, Virginia Tech

Rachel Johnson of Richmond, College of William & Mary

Katelyn Gough of Dillwyn, Longwood University Shai Sumpter of Newport News, College of William & Mary VSCPA UNDERGRADUATE SCHOLARSHIP ($1,000)

MJW SCHOLARSHIP ($3,500) Nicholas Altman of Abingdon, Radford University VERUS FINANCIAL PARTNERS SCHOLARSHIP ($2,500)

Tiffany Antognozzi of Williamsburg, Virginia Tech

Timothy Shenk of Harrisonburg, James Madison University

Kathleen Logsdon of Powhatan, Virginia Commonwealth University

WALL, EINHORN & CHERNITZER SCHOLARSHIP ($2,250)

James Mastria of Leesburg, Virginia Tech

Matthew Guendert of Lovettsville, College of William & Mary

Avery Trent of Roanoke, Radford University

YOUNT, HYDE & BARBOUR SCHOLARSHIP ($2,250)

VSCPA PH.D. SCHOLARSHIP ($5,000)

Charles Archer of Midlothian, James Madison University n

Ed Lynch, CPA, of Arlington, Virginia Commonwealth University VIRGINIA TECH DOCTORAL SCHOLARSHIP ($2,500)

>> 2015–2016 EDUCATIONAL FOUNDATION BOARD

Trent Henke, CPA, of Christiansburg, Virginia Tech THOMAS M. BERRY JR., SCHOLARSHIP ($2,500) Allen Au of Charlottesville, University of Virginia Ryan Polk of Mechanicsville, University of Virginia

CHAIR Randy Shapiro, CPA

VSCPA PAST PRESIDENTS/CHAIR SCHOLARSHIP ($1,000)

CHAIR-ELECT Rick White, CPA

Aaron Holloway of Roanoke, Virginia Tech

VICE CHAIRS Thomas Crutchfield, CPA Kristin White, CPA

CST GROUP SCHOLARSHIP ($2,250) Cory Greczyn of Bristow, George Mason University DIXON HUGHES GOODMAN SCHOLARSHIP ($2,000) Laura Fox of Hampton, Old Dominion University Paige Hogan of Atlanta, University of Virginia

SECRETARY/TREASURER Tina Lambert, CAE AT-LARGE DIRECTORS Courtney Barrack, CPA Whit Broome, CPA

H. BURTON BATES SCHOLARSHIP ($2,000) Elena Dorogy of Macon, Ga., University of Virginia

DISCLOSURES

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Dale Burgess, CPA Holly Caldwell, CPA Melinda Coley, CPA Brian Deibler, CPA Chris Ekimoff, CPA Heather Flanagan, CPA Dan George, CPA Chrissie Goodrum, CPA Nick Harrison, CPA Clare Levison, CPA Thomas Lyden Jr. Carolyn Menzie, CPA Vugar Shahtakhtinskiy, CPA Randy Spurrier, CPA Laura Tate-Smith, CPA

HTTP://DISCLOSURES.VSCPA.COM

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I AM the vscpa A FOCUS ON INDEPENDENCE >>

Two minutes with Nancy Miller, CPA I AM PASSIONATE ABOUT… Fixing what isn’t broken. We live in a world where you either embrace change or you will be left behind. I am always looking for ways perform my job both more effectively and more efficiently. I am a strong believer in continuous learning as a lifetime process.

PEOPLE DON’T KNOW THIS, BUT… I used to referee soccer games. I played when I was young, my son played travel soccer and I started refereeing when he was a teenager. It requires split second decision making and it’s great exercise. But it also requires very thick skin.

IF I WEREN’T AN ACCOUNTANT, I WOULD BE… Doing something that requires lots of creativity and is constantly changing. I really don’t do accounting anymore. I spend all my time researching, developing guidance and creative problem solving. I have a low tolerance for boredom so I like to be constantly challenged. In my role in the independence group at KPMG, I am always faced with something new to evaluate. I never have the same situation twice and many of the issues are very complicated. I also love training and public speaking and have been fortunate to have had many opportunities to speak at conferences for the VSCPA and AICPA. MY ADVICE TO FELLOW CPAs IS… Do what you love. We spend too much time at work not to be passionate about what we do. I can’t imagine having a job that you aren’t excited to start the day. And some days, I don’t want to leave.

I NEVER LEAVE HOME WITHOUT… Technology. If I have my laptop and a cell phone, I can work anywhere.

And my Kindle — seriously, that goes everywhere.

Nancy Miller, CPA, works in the independence

group at KPMG in Washington, D.C., where she focuses on independence matters under American Institute of CPAs (AICPA) and U.S. Governmental Accountability Office standards. She was previously a managing partner of a small CPA firm in Fredericksburg. Miller recently finished 13 years on the AICPA Professional Ethics Executive Committee Technical Services Subcommittee (TNS), which investigates violations of Generally Accepted Accounting Principles and Generally Accepted Accounting Standards of the AICPA Code of Professional Conduct. At the VSCPA, she has served on the Professional Ethics Committee, Peer Review Committee and Board of Directors, and has spoken at numerous conferences.

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I WISH CPAs KNEW… How important relationships are. At the end of the day, people are the only thing that really matter. While I am pretty introverted, I am most successful when I engage directly with people.

I’M A CPA BECAUSE… My uncle was a partner with Peat Marwick in Greensboro, N.C. I also was a math geek and thought that working with numbers seemed pretty cool. When I got to college, I loved all my accounting classes (well — maybe not cost accounting). I spent 30 years working for small firms and now I’m at KPMG! So I have come full circle back to my uncle’s firm. n

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