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CPA Advocacy July/August 2012

Volume 55, Number 1

Effective Partnerships ... and Advocacy Changes Coming to Peer Review Program Courage: The Key to Ethical Behavior

www.wscpa.org


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WashingtonCPA July/August 2012

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Contents

wa s h i n g t o n

CPA www.wscpa.org • memberservices@wscpa.org Tel (425) 644-4800 • Toll free in WA (800) 272-8273 Fax (425) 562-8853 902 140th Ave NE Bellevue, WA 98005-3480

BOARD OF DIRECTORS Mary D. Marino Chair Randy L. Wells Vice Chair Lucy L. Liu Treasurer Glenn G. Wisegarver Secretary Mark A. Hugh Immediate Past Chair Richard E. Jones President & CEO

Peter E. Doubleday David J. Miniken Joyce G. Etheridge Nerelys M. Ortiz Dean A. Granholm Sharon K. Philpott Robert L. Grannum Andrew L. Read Waylon P. Jones Rosemary Sanchez Marinilka B. Kimbro William A. Simer Karissa A. Lackey David E. Trujillo Peter R. E. Miller CHAPTER BOARD CHAIRS Waylon P. Jones Bellevue Area Joseph W. Crowther Central Joseph M. Reid Central — North Seattle Jack W. Curnow Northwest Kathryn A. Dixon Olympia — Peninsula — Pierce County Mary H. Hawkins Sammamish Valley Jeffrey L. May Seattle Rachel T. Sites Snohomish County Michael K. Briggs South King County John Vogel South Sound Industry Matthew E. Lee Southwest Lucas M. Zarecor Spokane — Wenatchee Kyle S. Meissner Yakima

Jeanette Kebede

Editor

The WashingtonCPA is published by the Washington Society of Certified Public Accountants for its members. Views and opinions appearing in this publication are not necessarily endorsed by the WSCPA. The products and services advertised in The Washington CPA have not been reviewed or endorsed by the Washington Society of Certified Public Accountants, its board of directors or staff. The WashingtonCPA (USPS 009754) is published six times annually by the Washington Society of Certified Public Accountants, 902 140th Avenue NE, Bellevue, WA 98005-3480. $12 of members’ annual dues goes toward a subscription to The WashingtonCPA. Periodicals postage paid at Bellevue, Washington and additional mailing offices. Cover photo ©istockphoto.com/OJO Images Photography. WSCPA conference photos © 2011-12 Fire Eyes Photography. POSTMASTER: Send address changes to The WashingtonCPA, c/o WSCPA, 902 140th Avenue NE, Bellevue, WA 98005-3480.

www.wscpa.org

Advocacy 5

Amplifying the Force of the Voice of the Profession

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Effective Partnerships ... and Advocacy • Advocacy at State Level • Advocacy at National Level • Two New Resources from the Profession

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Vote on Proposed Bylaws Revisions

13 Changes Coming to Our State’s Peer Review Program 15 2011-2012 Award Winners 19

The Dangers of Being Employed by a Financially Troubled Company

20 Courage: The Key to Ethical Behavior 39 Following a Lifelong Passion to Be at the Front of the Pack Departments 4

Leadership Lens

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11

News Briefs

30 Conferences

CPE Digest

14 Events

37

Registration Form

25

Washington CPA Foundation

38

Classified Ads

26

Tech Tip

39

Member Profile

28

Financial Literacy WashingtonCPA July/August 2012

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Leadership lens

Vote on Proposed Bylaws Revisions By Rich Jones, CPA, CGMA, President & CEO

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t its May 11, 2012 meeting, the WSCPA Board of Directors approved changes to our bylaws as recommended by the Board Governance Committee. The committee worked throughout the past year to review the current bylaws and to recommend improvements to them. As you will see, the changes are few and, in most ways, not particularly significant. You may recall that the bylaws underwent significant revisions in 2008. The bylaws were changed to provide that the number of directors of the organization would be set at between 14 and 20, depending on the needs of the organization. It was intended that these numbers would include the six officers of the Society. So if the Board were set at 14 members, it would consist of eight directors plus six other directors who were also officers of the WSCPA. Unfortunately, our bylaws as enacted provide that the six officers (Chair, Vice Chair, Immediate Past Chair, Treasurer, Secretary, and President & CEO) are in addition to the number of directors. For example, if the number of directors were set at 20 (the high end of the range), the number of Board of Director members would be 26. The Board Governance Committee and the Board of Directors agreed that a board of this size would be too large to be effective.The proposed bylaws provide that the six officers will be included in the total (14 to 20), rather than added to it. This change will make the bylaws consistent with what was intended in 2008. Another change to prevent unintended consequences provides that the Secretary and Treasurer will be able to finish out their director terms after their one-year terms as officers have concluded. Again, this was the intention in 2008.

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WashingtonCPA July/August 2012

In the revisions to the bylaws in 2008, the Secretary position was eliminated from inclusion in the Executive Committee. The proposed bylaws restore the Secretary to a member of the Executive Committee. Finally, the new bylaws will set the quorum requirement for the Society’s Annual Meeting at 30 regular members, rather than the current requirement of one percent of our regular members. Given that our membership numbers change on an almost daily basis, it is cumbersome to have to track membership on a specific day and it also requires that we record the number of regular members who attend our annual meeting. State law apparently requires that we

I hope you will vote to approve these changes to our bylaws. They are straightforward, easy to understand, and will result in positive changes. By now you should have received notice of this bylaws amendment process through e-mail if your member record includes an e-mail address. You can learn more about the details of the voting process on page 12 of this magazine. The voting period for approval of these bylaws amendments will be open from August 13 to September 17. The actual ballot for voting will be posted at www.wscpa.org/vote on August 13. Along with the ballot, you will find the current bylaws, the proposed bylaws marked to show the changes from the

WSCPA Bylaws Vote August 13 - September 17 www.wscpa.org/vote

either set a quorum at a specific number or at a percentage of our membership. Since our annual meeting now includes almost 300 members of all types, which greatly exceeds one percent of our regular membership (around 80 members), we are proposing this change. By way of reference, the Washington State Bar, which has a multiple of our membership, also sets its quorum requirement at 30 members. Other proposed changes to the bylaws are generally considered to be minor housekeeping changes for the purposes of simplification, clarification, and compliance.

current bylaws, and the proposed bylaws as amended. If you have any questions about these proposed changes, please feel free to contact me at rjones@wscpa.org or any other member of the Society’s management team. Thank you for your attention to this matter. The WSCPA is a great professional organization and I believe these changes to the bylaws will help us in our quest to be an even more effective organization, focused on enabling your success.

www.wscpa.org


Leadership lens

Amplifying the Force of the Profession’s Voice By Mary Dowling Marino, CPA, CGMA,WSCPA Chair for 2012-13

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ince the start of my year as the Chair of the WSCPA coincides with the 125th anniversary of the AICPA, it seems appropriate to reflect on the role our national organization plays in the professional lives of its members, particularly as it relates to advocacy around issues connected to the practice of accounting. Since its founding in 1887, the AICPA has served members in the areas of education and licensing and setting professional standards, while maintaining a rigorous code of ethics and a commitment to serving the public interest. For most of its nearly 380,000 members in 128 countries, the organization provides resources for the various stages throughout their careers. For many members, the AICPA serves as their primary resource for education and technical updates. At other times, members look to the organization for guidance in the areas of rule-making and standard-setting as it relates to professional conduct and issued statements. The value of professional education and standard setting cannot be overlooked, however it is in the unique role as advocate before legislative and regulatory bodies and other professional organizations that the AICPA has directly shaped the look and feel of the profession for each of its members and for the public they serve. In its simplest form, advocacy is active support, especially of a cause. For CPAs, our reputation for adherence to the highest ethical and technical standards has provided the individual credibility which is the hallmark for how we are viewed in the workplace. By combining our individual voices, the AICPA and our state societies have effectively amplified the force of the profession’s voice, far beyond what we might have accomplished in our own spheres. Without the guidance and organized intercession by the AICPA, the practice of accounting might look very different today. www.wscpa.org

I recently attended the Spring Council meeting for the AICPA in Washington as one of the delegates from the state of Washington. I was impressed as we reviewed several of the current successes at the scope of the profession’s advocacy. Some of the more notable accomplishments in the past three fiscal years include

Without the guidance and organized intercession by the AICPA, the practice of accounting might look very different today. the achievement of CPA mobility statutes in 48 states and the District of Columbia; a regulatory exemption for CPAs from the Consumer Financial Protection Bureau established under the Dodd-Frank Wall Street Reform and Consumer Protection Act; successful limitation of the scope of the IRS registered tax return preparer program; and the lead in the coalition to repeal 1099 expanded reporting requirements. The ban on tax strategy patents further defined how CPAs may conduct business and demonstrated the ability of the organization to mobilize its political strength in key legislative issues. As stated on the AICPA website, the AICPA maintained that no one should have a monopoly over any part of the tax code and all Americans should be free to use any legally permissible means to comply with the law. The business issues that confront us are complex and as the world of business becomes more global, advocacy becomes even more important. I recommend that you spend some time looking at the AICPA website and particularly, the tab associated with Advocacy. As of the date of this article, there were

sections in Federal, State, Tax, International and Legal Advocacy which highlighted the most recent AICPA efforts in these areas. In addition, there is an e-newsletter, The CPA Advocate, dedicated to keeping members informed about ongoing efforts in each of these areas. For many state societies, advocacy at the state level is accomplished solely through the use of outside professionals. We are fortunate in Washington to have internal resources working closely with our resources in Olympia to look out for the interests of CPAs in our state. Rich Jones, our President & CEO, works closely with Judy Love, Director of Advocacy, and WSCPA lobbyist, Lisa Thatcher, to monitor state-wide developments. The Board of Directors is informed at every meeting about the status of the WSCPA’s advocacy efforts and considers suggestions for future strategies. As WSCPA members, you have the opportunity to review local advocacy on www.wscpa.org, and to support advocacy efforts by contributing to the CPAPAC. You can also work directly with our local team by joining the Society’s Grassroots Volunteers group. The atmosphere throughout the three days of Spring Council was celebratory about the past and purposeful as to the future as more than 500 individuals discussed “what’s next” for the profession. As I looked around the room at the other attendees representing all 50 states and other international accounting organizations, I really felt the power of that combined group to affect how CPAs are viewed now and for the next 50 years. We serve as your voice in that process, please let us know how we can best advocate for you. You can contact Mary D. Marino at Mary.Marino@cliftonlarsonallen.com. WashingtonCPA July/August 2012

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cover story

Effective Partnerships ... and Advocacy By Judy Love,WSCPA Director of Advocacy

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t the beginning of the year, 300 members were asked to provide some feedback to assist the Board of Directors as they prepared to review and update the WSCPA’s Strategic Plan. The WSCPA’s role as an advocate for the profession rose to the top of members’ lists, appearing over 100 times, in answer to the question: What does the WSCPA do really well? “Legislative advocacy.” “Takes the lead on issues affecting CPAs.” “Advocating for the profession at the state and federal level.” “Advocacy for the CPA profession.” “Advocacy.” “Advocacy.” “Truly an advocate for the profession.” The WSCPA was created 112 years ago for the purpose of having a say in drafting the rules and laws that defined the practice of accountancy in Washington State. Advocacy was – and continues to be – the Society’s core purpose and competency since then.

Advocacy at State Level At Long Last - CPA Retired Ability to use designation effective June 1, 2012 After years of delay, regular reminders from stalwart members like Alan McAllister, many lengthy discussions, a bit of wishful thinking that the Uniform Accountancy Act would address the issue, and waiting for a strategically timed window of opportunity that would not conflict with other legislative efforts, this was the year to formalize a designation for retired CPAs. A combined task force of WSCPA members and Washington State Board of Accountancy (WBOA) members worked for a number of months to develop a proposal to present to the full Board for its consideration. The WBOA adopted the rule change at its April meeting, amending WAC 4-30-058, effective June 1, 2012, to allow use of the designation “CPA Retired” for those licensed CPAs who provide notice to the WBOA and meet the following criteria: 1.

Have reached 60 years of age and hold an active license in good standing; or

2.

At any age, have held an active license in good standing, not suspended or revoked, to practice public accountancy in any state for a combined period of not less than 20 years.

That’s terrrific!” exclaimed Alan McAllister when told he may now use the designation, CPA Retired. “Thank you. I appreciate all the work the WSCPA has done to make this happen!”

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WashingtonCPA July/August 2012

Grassroots Connections More Important This Year than Ever WSCPA volunteers make a difference Most political observers predict that the election in November will produce some of the most sweeping changes in the Washington State legislature in decades. A number of long-time legislators, some in key leadership positions, have decided not to run again, potentially opening those seats to newcomers. Redistricting brings both challenges and opportunities, increasing the value of CPAs with strong connections with legislators in their districts. If you have a relationship with a legislator, or are willing to establish a connection, you are in a perfect position to be an advocate for the profession.

Why would anyone do this?

To date, the profession has been able to make a successful case for not imposing a sales tax on professional services, even though that potential source of revenue is regularly discussed in Olympia. However, considering the State’s budget problems, combined with the likelihood of many new legislators with no historical understanding of why the tax on services has been rejected to date, a perfect storm could be brewing. Legislators often base decisions upon communications they receive from constituents. CPAs communicating a consistent message on this one issue alone could be critical.

Got 10 minutes?

The WSCPA staff and lobbyist carefully watch events in the legislature and alert Grassroots Volunteers when a hot issue requires action. The next steps are: 1.

WSCPA staff sends an e-mail to volunteers outlining the issue.

www.wscpa.org


©istockphoto.com/Lawrence Freytag

Most political observers Advocacy predict that the election in November will produce some of the most sweeping changes in the Washington State legislature in decades.

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Volunteers add a localized perspective of the impact of legislation on their practice or their clients.

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Volunteers then send the e-mail to their legislator; WSCPA staff usually provides the legislator’s e-mail address.

Don’t personally know a legislator?

If you do not personally know a lawmaker, do not let that deter you. The Advocacy team and other volunteers can help you make connections. A good way to start is to go with an experienced grassroots volunteer to deliver a CPAPAC check to a legislator. These meetings are very informal, generally take less than 30 minutes and are often held in a convenient neighborhood Starbucks. Editor’s note: Rick Honsowetz, a long-time grassroots volunteer and member of the CPAPAC Committee whose comments about the CPAPAC appear below, was once the key to moving a vote on mobility legislation; the Senator in his district wanted to talk with him first before she decided. Relationships with legislators make a difference.

CPAPAC Campaign Contributions Important Communications Tool

The CPAPAC is an independent, voluntary, nonprofit political action arm of the WSCPA that supports candidates regardless of political affiliation based on their ability to make a difference for Washington CPAs and businesses. CPAPAC contributes $80,000 - $90,000 during each election cycle to candidates in both political parties that serve in key leadership positions or on committees with oversight of issues affecting the profession.

www.wscpa.org

WSCPA members often deliver CPAPAC checks in person to candidates. The discussions during these informal meetings serve to increase the profession’s visibility and enhance legislators’ understanding of the critical role CPAs play in preserving the state’s business climate. Legislators acknowledge and appreciate the strength of a 10,000-member organization. In addition to the 2012 legislative campaigns, the CPAPAC will make contributions to both candidates for Governor. A small group of Committee members will deliver the checks, which will provide an opportunity to discuss the value of a strong Washington State Board of Accountancy to the public and the profession. It is vital a new governor understands the important role he will play in appointing people with the skills and experience required to maintain the Board’s quality of public service and national reputation.

I have very much enjoyed being a member of the CPAPAC Committee and advocating to our legislators on behalf of our profession and business. Along with the pleasure of meeting other CPAs on the Committee who are similarly devoted, it has provided me the opportunity to meet with our State Representatives and Senator to discuss, educate and inform them on issues vital to our profession and our economy. Our elected officials create the environment in which we all conduct business—professional advocacy is a way that we can have a positive influence on that environment. We don’t all have the time for personal involvement in this effort, but all CPAs should contribute financially to this important work.” Rick Honsowetz, CPA, CliftonLarsonAllen LLP

WashingtonCPA July/August 2012

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Advocacy

Advocacy at National Level

State Societies Support AICPA Advocacy Efforts Just as the WSCPA relies on grassroots volunteers to communicate the profession’s position on important issues in Washington State, the AICPA similarly relies on state societies to connect with their congressional delegations, the IRS, PCAOB and a host of other standards setters. Here are just a couple of the recent issues this effective partnership has been working on: Audit - PCAOB Mandatory Firm Rotation Proposal

BACKGROUND: In August, 2011, the PCAOB issued: Concept Release on Auditor Independence and Audit Firm Rotation (Release No. 2011006) focusing on various recommendations, including the periodic, mandatory rotation of an audit firm. ISSUE: Sarbanes-Oxley delegated responsibility for overseeing the financial reporting process, including the hiring and firing of the external auditor, to independent audit committees. Audit committees have the requisite skills, fiduciary knowledge and experience, and provide a balanced approach to the auditor’s ongoing engagement and retention. The PCAOB concept release recommends mandatory audit firm rotation with the stated intent to improve auditor independence, objectivity and skepticisms; however, it is unclear and unproved whether periodic, mandatory change in audit firms would achieve those goals. Of the roughly 600 comment letters received by the PCAOB during the concept release initial public comment period, 94% were against mandatory audit firm rotation, including that of the Government Accountability Office (“GAO”), which stated the PCAOB “does not provide compelling evidence that the root cause of the audit quality issues

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WashingtonCPA July/August 2012

[it has found] is related to a breakdown in auditor independence.” AICPA POSITION: The accounting profession opposes mandatory firm rotation due to the significant costs and disruption, the lack of evidence linking engagement tenure to audit quality, and, most importantly, the risk that mandatory rotation is actually a detriment to audit quality Investment Advisor Regulation

BACKGROUND: Currently, the SEC conducts oversight of registered investment advisors. However some groups are calling for self-regulatory organizations (SROs) to take the oversight role from the SEC. According to a December 2012 economic analysis by the Boston Consulting Group, the annual cost of an SRO operated by the Financial Industry Regulatory Authority (FINRA) which examines investment advisory firms would cost the firms twice as much as paying user fees to the SEC to allow it to appropriately upgrade is oversight capabilities. ISSUE: The Investment Adviser Oversight Act of 2012 would mandate that SROs oversee SEC-registered investment advisers. The bill is strongly supported by FINRA and is likely to be considered soon by the Financial Services Committee.

The calm exterior of the U.S. Capitol Dome on a recent Spring evening belies the turmoil inside.

AICPA POSITION: AICPA believes that the SEC’s core mission to protect investors requires adequate regulation of the investment advisory profession. The SEC remains the proper regulatory body to protect the public’s best interests. Providing the SEC with resources to properly enforce its rules is the best solution for investors and the public. The accounting profession opposes The Investment Adviser Oversight Act (H.R. 4624).

Other recent issues include:

IRS Tax Compliance Visits

Mobile Workforce

Patent Trolling

Sarbanes Oxley Act (SOX) Section 404(b)

The JOBS Act

Tax Return Due Dates

Uncertain Tax Positions

USDA AGI Certification

To learn more about each of these issues, please visit the Newsroom at www.wscpa.org. www.wscpa.org


Advocacy

New Resources from the Profession

Regardless of the issue, the underlying message in any advocacy effort is always that CPAs’ broad experience, knowledge and skills can be a resource to decision-makers. While many issues can literally take years to work through, input from the profession can inform the discussion. With that in mind, the AICPA recently developed two resources that can be useful to state and federal legislators, as well as the public. If Congress decides to get serious about tax reform, both resources could become even more valuable.

What’s at Stake: A CPA’s Insights into the Federal Government’s Finances www.aicpa.org (search for “what’s at stake”)

AICPA Develops Resource for Policymakers

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Some 500 CPAs visited their congressional delegations in May to share the AICPA’s new video, What’s at Stake: A CPA’s Insights into the Federal Government’s Finances, which concisely and objectively explains the importance of the US government’s financial statements and why policymakers should consider this information carefully. AICPA Chairman of the Board of Directors Gregory Anton, CPA, CGMA, offers insights into the financial statements, which provide critical information about the financial health of our country. The CPA profession calls on both policymakers and the public to engage in a national dialogue to improve our country’s fiscal health.

Why the US Government’s Financial Statements Matter

Discussion of our nation’s fiscal health usually focuses on the annual budget. However, the US government’s financial statements provide a different perspective into the fiscal health of our country. The financial statements contain more detailed information about the longer-

www.wscpa.org

term implications of the government’s operations. The budget shows what is bought and paid for in a given year, while the financial statements show what the government is committed to purchasing, whether it is covered by the budget or whether it will require borrowed funds. With this video, the CPA profession seeks to raise awareness of this distinction and call attention to how and why the financial sustainability of our country is at stake.

Working on Behalf of the Public Interest

The CPA profession’s responsibility is to protect the public interest and help the public understand complex financial issues.This video gives a non-partisan and clear analysis of some of the most important information in the US government’s financial statements, and affirms the CPA profession’s commitment to protect and inform the public. It also aims to raise awareness about our country’s current financial situation.

WashingtonCPA July/August 2012

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cover story

New Resources from the Profession

AICPA Launches Total Tax Insights™ Calculator www.totaltaxinsights.org

The AICPA launched Total Tax Insights™ calculator to the public on May 15. That same day, some 500 CPAs visited their congressional offices during AICPA Council to discuss and promote the calculator uses and its value. Coming soon: WSCPA members will be able to access material to promote the Total Tax Insights calculator to clients and prospective clients.

Advocating for Sound Tax Policy, Transparency and Simplification

As a long-time advocate for sound tax policy and effective tax administration, the AICPA has encouraged a principled framework for analyzing tax law changes. One of those principles is the notion of Transparency and Visibility – citizens should know that a tax exists and how and when it is imposed upon them and others. By linking the federal tax rules together with the diversity of our country’s state and local tax conventions, including approximately 20 of the most widely used taxes, the Total Tax Insights calculator is a first-of-a-kind tool offered by the CPA profession to help the public understand their estimated annual tax obligation wherever they might live. It also serves as a valuable resource to foster awareness of the need for financial planning and making better informed financial decisions.

Providing Insights into Taxpayers’ Estimated Annual Tax Obligations

The calculator is an online form, customized by state and county, that includes fields for taxpayers to input their information. At a minimum, the taxpayer must enter the county and/or city where they live, marital status, federal “adjusted gross income” and number of dependents – exact or estimated information. Certainly, the more information that is entered, the more comprehensive a view they will have of their estimated overall tax liability. However, the additional information, such as how much gasoline they purchase a week or their property tax bill, is not required.

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WashingtonCPA July/August 2012

The resulting estimated tax calculation provides taxpayers with a number of insights: • A greater understanding of the number and variety of taxes they pay and the estimated amounts for each; • An increased awareness of the need for better financial planning; and • Additional information to consider, for example, when changing jobs, making a large purchase or deciding whether to buy or rent a home.

Important Message Directed to Calculator Users

The Total Tax Insights website explains to visitors that the calculator is not a tax preparation tool, nor is it a substitute for the trusted financial and tax advice of a CPA. It has been developed to give taxpayers greater clarity about the overall taxes they pay, not an exact amount.

Additional Resources and Help with Finding a CPA

In addition to the calculator, visitors to the website will find a number of resources and relevant information, such as a glossary, articles and blogs, and links to federal, state and local tax websites, to help them learn more about the taxes they are paying. The results page of the calculator may prompt questions about what this information means and the need for tax and financial planning.To help taxpayers get answers to their questions, The AICPA has included a link throughout the site to the Find a CPA page on 360taxes.org, which will allow them to locate a CPA in their state from the state CPA society member databases.

You can contact Judy Love at jlove@wscpa.org.

www.wscpa.org


news briefs

Notice to Membership: Bylaws Vote, August 13 September 17 At the May 11, 2012 Board of Directors meeting, the Board Governance Committee recommended changes to the WSCPA Bylaws. The WSCPA Board of Directors has authorized a membership vote on the proposed bylaws changes.

And the Winners Are... Three WSCPA members were selected as winners from 12,392 entries in the WSCPA annual dues drawing. Each member received a $300 Amazon gift card. Congratulations to the following members: •

Signed ballots will be accepted from August 13 through September 17, 2012. The votes will be counted at the end of that period, and, if adopted, the bylaws will go into effect October 18, 2012.

Danette M. Cordell, CPA, is a manager with St. Maries School District #41 in St. Maries, Idaho and has been a member since 1993.

For more information on the bylaws vote please go to www.wscpa.org/vote or see the President & CEO’s column. If you do not have access to a computer and would like more voting information or a copy of the proposed bylaws, please call (425) 644-4800.

Paul G. Hawkins, JD, is a partner with Hawkins Edward Inc., in Spokane, and has been a member since 1985.

J. Steven Forbes Jr, CPA, is a partner with Larson Gross, PLLC in Bellingham, and has been a member since 1987.

On or about June 28, all WSCPA Regular and Honorary Life Members received a notice and instructions for casting their ballots.

Glenn W. Wisegarver, CPA, Secretary

Members who updated their member profile and paid their dues by June 1 were eligible for an additional drawing for a $100 Amazon gift card. Of the 1,582 eligible entries, congratulations to the winner: •

James B. Newkirk, CPA, is the CFO/Treasurer of DS-IQ Inc., in Bellevue, and has been a member since 2009. Mr. Newkirk has generously donated his $100 winnings to the Washington CPA Foundation.

Student members who paid their dues by June 1 were eligible for a drawing for a full Becker CPA Review Course valued at over $2,000. Of the 340 eligible entries, congratulations to the winner: •

John Pudelkewicz works for JW & Associates, PLLC in Colfax, and has been a member since 2011.

Thank you to all members who renewed their membership. If you still need to renew, visit www.wscpa.org or call (800) 272-8273 (toll-free in Washington) or (425) 644-4800. If you are currently unemployed or on leave for family or medical reasons please call (425) 5861142 to determine if you qualify for a reduced rate. Renew your membership by July 31, 2012 to avoid a lapse in your member benefits. www.wscpa.org

WashingtonCPA July/August 2012

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news briefs

2012 PCPS/TSCPA National MAP Survey Online Through July 20

The country’s largest CPA firm practice management benchmarking survey is now live. This survey is brought to you by PCPS (Private Companies Practice Section) and TSCPA (the Texas Society of CPAs), who are pleased to welcome back Aon Insurance Services as a proud survey sponsor. Targeted benchmarks will include billing rates, chargeability ratios, compensation, and other key performance indicators. The value of these benchmarks depends on broad participation among CPA firms. The survey is open to all firms (you do not need to be a member of PCPS or TSCPA to participate). Managing partners and firm administrators can access the survey at http://map.pcps.org. You’ll be prompted for your information, and a personalized, secure link will be sent to you at that time. The survey will close July 20. For more information on the survey, visit http://aicpa.org/pcps.

Season Ticket - Your Ticket to Affordable CPE

Enjoy WSCPA live seminars, webcasts and conferences for one affordable price with the Season Ticket. Exclusively available to WSCPA members, the Season Ticket allows you to take up to 80 hours of CPE from June 1, 2012 to May 31, 2013 for only $1,745 — that’s just $174.50 for an 8-hour course. Save time on CPE planning and register for a total of six programs (any 2, 4, 6, or 8-hour program, except for chapter CPE) at a time. Order the Season Ticket at www.wscpa.org or call (425) 644-4800 or (800)

272-8273 (toll-free in Washington).

In Memoriam The WSCPA holds in memory with families and the larger community, these members who have recently passed on: Benedict Gerhard Armstrong, CPA Norman G Bowman, CPA Gary Barnett Crane, CPA Donald F Escher, CPA Curtis J Fallon, CPA Gary G Guinn, CPA Thomas W Hart, CPA Bradley S Hoekstra, CPA Theodore E Larson, CPA Peggy D Niles, CPA Leonard R Watterson, CPA Lorin H Wilson Alfonso A Zaborsky, CPA

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Special Member Discount from CCH Save 30% on CCH U. S. Master Tax Guide Order by September 30

The sooner you reserve your copy of the industry’s leading tax guide, the higher your discount—reserve your copy by September 30, 2012 and save 30% off the list price of $90.95. That means WSCPA members pay just $63.67 plus shipping. You will not be billed until after the book ships. (Cancel before shipment without charge.) The publication comes in both text and convenient e-book formats. The 2013 edition will contain timely and precise explanations of federal taxes for individuals, corporations, partnerships, estates and trusts. Save up to 40% on the monthly titles featured by CCH. Check back each month to save on new titles. To order the U. S. Master Tax Guide and other publications available through CCH, visit http://tax.cchgroup. com/members/wscpa and enter your member discount number (Y5596).

CPA Referral Service Extend or Begin Your Subscription Now If your firm is currently enrolled in the WSCPA Find a CPA Referral Service, it is renewal time! The cost of the enrollment is still just $175—less than 50 cents per day—and covers your listing through June 30, 2013. If your firm is not currently enrolled and you are looking for ways to build your client base, look no further than the WSCPA Find a CPA Referral Service. The WSCPA referral service is a great source of new clients looking for services in industries that match your firm’s expertise. Rather than using directory assistance to find a CPA, potential clients feel comfortable about their referral from the WSCPA because they are able to view information about services offered by your firm. To find out more about the service or to enroll call Jennifer Ayoub, Membership Services Administrator at (800) 272-8273, Ext. 1142 (toll-free in Washington) or (425) 586-1142 or e-mail jayoub@wscpa.org. www.wscpa.org


Peer Review

Changes Coming to Our State’s Peer Review Program By Ray Holmdahl, CPA, Chair of the WSCPA Peer Review Executive Committee

W

ashington State’s Peer Review program is about to go through some extensive changes. These changes are going to create a significant opportunity for CPAs willing to become peer reviewers. But first, a little background.

The WBOA has proposed rules to eliminate the QAR program, so firms par-

Peer Review in the State of Washington

The Peer Review Program was created by the AICPA over 20 years ago to enhance the quality of accounting, auditing, and attestation services performed by AICPA members (and non-members) in public practice. A Peer Review is the process whereby a CPA firm hires another CPA firm (a “peer”) to review its financial statement portions of the firm’s practice. There are two types of reviews: •

Engagement Reviews, which are usually performed for entities that don’t perform audit or examination engagements. In an Engagement Review, the peer reviewer usually looks at selected engagements and focuses on the accountant’s report, the financial statements, and selected documentation. System Reviews, which are usually performed for entities that perform audits or examination engagements (and compilations and reviews). In a System Review, the peer reviewer focuses on the quality control system associated with financial statement engagements. This includes reviewing the financial statements and related working papers for various engagements and administrative functions related to financial statement engagements (for instance, is appropriate CPE being taken, and is it adequately documented).

www.wscpa.org

ticipating in that program will need to participate in the WSCPA Peer Review program. Entities that are allowed to have an Engagement Review may elect to have a System Review. In either case, the review must take place at least once every three years. The Peer Review program is very important to our profession because it strengthens firms’ quality control and encourages firms to improve process (and correct any shortcomings). By improving the quality of the profession, Peer Review contributes to the public’s confidence in us. Prior to the upcoming changes in the Peer Review program, a Peer Review had to be administered by the Washington Society of CPAs or the American Institute of CPAs. For firms that only audit public companies, the Public Company Accounting Oversight Board (or, PCAOB) inspection process would also satisfy the Peer Review requirement. The requirement to have a Peer Review comes from the Washington State Board of Accountancy (WBOA) and is applicable to all CPA firms in Washington State, UNLESS the CPA firm elected to have a Quality Assurance Review (QAR) described below. If a CPA firm has no AICPA members and is required to have an Engagement Review as described above, it could elect out of the Peer Review Program and have a QAR instead. The QAR program

is administered by the WBOA, and it generally required the CPA firm to send in a sample of financial statements it had prepared over the last year. QAR volunteers (generally CPAs) then reviewed these reports for adequacy.

The Change

Over a three year cycle, there are approximately 520 Peer Reviews administered by the WSCPA and 330 QAR program reviews administered by the WBOA. The WBOA has proposed rules to eliminate the QAR program, so firms participating in that program will need to participate in the WSCPA Peer Review program. This means the CPA firms that had been participating in the QAR program are going to be required to enroll in the WSCPA Peer Review program, and will need to find a peer reviewer.

How You Can Help

The WSCPA needs qualified peer reviewers.With the proposed elimination of the QAR program, the number of Peer Reviews (and the need for peer reviewers) will increase significantly.To qualify as a peer reviewer, you must: •

Be an AICPA and WSCPA member in good standing;

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peer review

Be active in public practice at a supervisory level in the accounting or auditing function; and Have 5 years of public accounting experience.

In addition, if you are a partner in your firm, you are qualified to be a peer review team captain. If you complete the requirements listed above, the WSCPA may include you on the “list of available reviewers” when CPA firms contact the WSCPA in search of a reviewer. You can also do your own marketing to our profession. In addition, you have the ability to perform reviews in other states (oftentimes, CPAs don’t like their reviewers to come from the area in which they operate). There are great benefits to being a peer reviewer, including: •

Expanding your understanding of how other CPAs or CPA firms operate, including your knowledge of best practices. Expanding your network of CPA acquaintances. This can lead to additional business leads…it is not uncommon for a CPA or CPA firm to recommend their peer reviewer for services that may be beyond their resources. Giving back to your profession.

2012

Networking Events

Learn more & REgister: www.wscpa.org/CPE/catalog (enter “NP” in search box) FEES: $20 per event

Puget Sound

Aug 16 Oct 25

Members’ Reception - Bellevue Club, Bellevue (NP02) The Pike Brewing Company, Seattle (NP03)

Register today!

SPOKANE

Nov 13

DoubleTree Hotel Spokane City Center, Spokane (NP04)

In Summary

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Key Partner

Supporter

Thank you!

Ray Holmdahl, CPA, is Managing Partner at Peterson Sullivan LLP in Seattle. He can be reached at rholmdahl@pscpa.com. He has served on WSCPA Peer Review Committees since 1999.

Premier Partners sponsorS

With the elimination of the WBOA’s QAR program, the WSCPA Peer Review program is going to grow significantly. I encourage you to become a peer reviewer, if you meet the qualifications. If you are considering it, please contact Julie Phipps at the WSCPA. Julie’s e-mail address is jphipps@wscpa.org and her phone number is (425) 586-1132.

Friends

Spokane Chapter

www.wscpa.org


2011-2012 Award Winners

Steven Huebner

Bader Martin PS

E

very year the WSCPA recognizes CPAs for making a difference in their communities, providing outstanding service, dedication or leadership to advance the accounting profession and the Society. The Society congratulates this year’s honorees. 2011-2012 John L. O’Brien Lifetime Achievement Award Steven D. Huebner, CPA For an exemplary career dedicated to providing service to the healthcare and not-for-profit sector and for leadership to the profession. An active WSCPA member since 1979, Steve Huebner has provided decades of exceptional leadership in the healthcare and not-for-profit fields. An audit partner in the Seattle office of KPMG, he is a well-known and respected expert in the not-for-profit and healthcare fields, with more than 30 years of not-for-profit experience. “He is a consummate professional who has been a strong mentor and role model for all those who have worked with him,” said Karissa Lackey, CPA, an audit senior manager with KPMG. Over the years, Steve has been responsible for developing a number of healthcare methodologies. Steve currently serves on the Advisory Board of the Seattle University Health Executive MBA Program, the board of Wasatch Academy, and is an Audit Committee member of Sisters of Leavenworth Health System. www.wscpa.org

In the past he served as the board chair of the Northwest Kidney Center, as a board member and president (board chair) of the WSCPA from 1994-1995, and as an associate clinical professor for the University of Washington School of Public Health Administration. 2011-2012 Business of the Year Bader Martin PS For exceptional support of the WSCPA through volunteer service and commitment to programs. Bader Martin, PS is a nationally recognized CPA and business advisory firm with a long history of promoting and supporting the activities and programs of the WSCPA.All of its eligible staff are WSCPA members and 15 percent also participate on various committees and chapters. The firm consistently sponsors the Society’s New Professionals activities and supports WSCPA educational events. Bader Martin has also been recognized, both locally and nationally, as a great place to work. It consistently ranks among Washington’s 100 Best Places to Work For and, for the last four years, has been awarded the Alfred P. Sloan award for Business Excellence in Workplace Flexibility.

Bill Wells

2011-2012 Special Award Bill Wells For promoting the value of the profession by inspiring and mentoring countless students to become CPAs. “Through his inspiring and highly effective teaching, Bill Wells has been a positive influence on many aspiring accounting students, convincing them of the value of the CPA,” says Pete Miller, CPA, a principal with Clark Nuber PS. “He is a great ambassador for the profession.” Wells teaches “Introduction to Financial Accounting” and “Accounting for Problem Solving” at the University of Washington Foster School of Business. Before becoming an educator, he served a distinguished 20-year career in the military. He earned a master’s degree in professional accounting at the University of Washington in 1989 and joined the Foster School’s faculty that same year. Both in and out of the classroom he has been active in developing young accountants. “It is hard to find a UW accounting grad that has not had a wonderful experience with Bill or that has something genuinely nice to say about him,” said Pete. He served as faculty director of the Foster School’s Chapter of Beta Alpha Psi, and under his guidance from 2000-2005, the chapter grew from 30 to more than 200 members. Bill served on the WSCPA Board of Directors from June 2009 to May 2012. WashingtonCPA July/August 2012

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2011-2012 Awards

Robbie Dahl-Sullivan

Ann Norman

2011-2012 Special Award Robbie Dahl-Sullivan

2011-2012 Volunteer of the Year Joseph P. Sambataro

2011-2012 Volunteer of the Year Ann Norman, CPA

For fostering a progressive relationship between Becker CPA Review and the WSCPA while providing guidance and assistance to students who aspire to become CPAs.

For extraordinary commitment to the Washington CPA Foundation through significant fundraising and establishing the Named Scholarship program.

For outstanding leadership of the Taxation Committee resulting in greater participation and broader exposure to the general membership.

Robbie Dahl Sullivan has represented Becker CPA Review, now Becker Professional Education, for 20 years. She has held several positions within the company, and now focuses on the students and firms in Washington State. She takes pleasure in the success of the amazing CPA candidates in Washington, and happily joins with the WSCPA to assist them on their journey. “Robbie is well known and respected on campuses around the state. She has invested countless hours and resources into providing guidance and assistance to students that aspire to become CPAs,” said Mark Peterson, WSCPA Academic & Student Relations Coordinator. Robbie is married to a Bellevue lawyer, the proud mother of four, and grandmother of nine. Her employment with Becker was “a part-time job that immediately grew way out of proportion,” said Robbie. She started her career as a special education teacher at the elementary school level. She was awarded the 2009 PRIDE AWARD, the highest standing within the Becker organization.

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Joseph Sambataro

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Joseph P. Sambataro, Jr., a Trustee on the Washington CPA Foundation since 2010, was the driving force behind the development of the Foundation’s Named Scholarship Program. He inspired the Trustees to embrace the concept, and he and his wife became the first Named Scholarship contributors via the Sambataro Family Foundation Accounting Scholarship. “His willingness to tap his personal network to generate named scholarships on behalf of the Foundation has brought in over $20,000 in the past year,” said fellow Trustee Heather Fitzpatrick, CPA. “He has been steadfast and persistent, encouraging others while leading the charge.” “We cannot thank Joe enough for his efforts, and we know the Foundation is lucky to be one of the focuses of his volunteer efforts,” said Michelle Gretsch, CPA, Foundation Board President for 2011-2012. Mr. Sambataro served as CEO and President of True Blue, Inc. from September 2001 to May 2006 and as Chairman of the Board since September 2008. Prior to joining True Blue, Mr. Sambataro served as the Managing Partner of the Seattle office of BDO Seidman, LLP, an accounting and consulting firm, from 1990 to 1997.

Thanks to Ann Norman’s leadership as Chair of the WSCPA Taxation Committee from June 2010 to May 2012, the Taxation Committee raised awareness of timely taxation topics among the committee and the general membership. More members are participating in person or via teleconference, more resources have been shared via the committee’s section of the website. “Ann is an excellent delegator, which has increased committee members’ interest and engagement,” said Judy Love, WSCPA staff liaison to the Taxation Committee. “She is an excellent facilitator, coming to each meeting with a wellprepared and thorough agenda, keeping both program and business portions of the meeting on track.” With more than 25 years of experience in public accounting, Ann Norman is principal of Norman & Kitto PLLC, which she founded with Sandra Kitto in 1997. She focuses her tax practice on tax compliance and administration, including estate planning and taxation, trust income tax planning, fiduciary accounting, and gifting issues.

www.wscpa.org


2011-2012 awards

Brett Jordan

2011-2012 New Professional of the Year Brett Jordan, CPA For extraordinary commitment to the continued vibrancy of the profession through advocacy, member engagement and student scholarships. Brett Jordan, CPA, has been an active member of the Society’s Puget Sound New Professionals and the Emerging Leaders Conference Planning Committees since 2010. “This year he stepped up to take on leadership roles within those committees,” said Amy O’Donnell, WSCPA staff liaison to the New Professionals Committee. Building on his past work in advocacy, Brett worked with WSCPA staff to gain a better understanding of the grassroots advocacy program and has been teaming with them to identify ways to engage the younger generation. He has been a strong promoter of WSCPA membership and the value of building a professional network. In addition to supporting the Washington CPA Foundation, Brett also created a scholarship at Western Washington University for accounting students (and of course WSCPA membership is part of the criteria for applying for his scholarship). Brett is an audit senior assistant in the Audit & Enterprise Risk Services group of Deloitte & Touche, LLP in Seattle.

www.wscpa.org

Jim Ladd

2011-2012 President’s Award Jim Ladd, CPA, CGMA For creating a strong strategic board through inspirational leadership and setting direction in governance. For excellent representation of the profession in the community. “Jim Ladd has made many valuable contributions to the WSCPA throughout his career,” said Rich Jones,WSCPA President & CEO. He served on the WSCPA Board of Directors from June 2007 through May 2012, serving as Chair from June 2010May 2011 and on numerous committees, including the Washington CPA Foundation from 2001-2010. In addition, he served as Chair of the Board Governance Committee for the past year. “Jim’s experience as a board member and chair for many nonprofit and commercial organizations was valuable to our Board of Directors as we updated governance processes and addressed the ever-changing strategic needs of the Society. Most recently, he agreed to lead our efforts to support the new CGMA designation and initiatives to increase the Society’s relevance to members in industry.” Jim is CFO/Treasurer for the Institute for Systems Biology in Seattle. Having previously served as a partner with Tatum, LLC, a national executive services firm, Jim has enjoyed a varied career in public accounting, international business, public and private corporations, and notfor-profit organizations. He is a retired managing partner of Deloitte’s Seattle and Tokyo offices.

Richard Jones

2011-2012 Chair’s Award Richard E. Jones, CPA, CGMA For outstanding sustained leadership and innovation.

Rich Jones is the President & CEO of the Washington Society of CPAs. Previously, he was a member of Ernst & Young for more than 30 years until he retired in June of 2004. “I started serving on the WSCPA Board in 2005, within months of Rich,” said Mark Hugh. “Since that time, the WSCPA increased membership by 20 percent; engaged younger members; turned a hostile relationship with regulators into a collaborative one;and revitalized its programs. Many members participated in these initiatives, but the one constant is Rich, who worked tirelessly to continually improve the WSCPA, and provided outstanding sustained leadership and innovation.”

The Board of Directors selects recipients for the Annual Awards. The President & CEO selects the President’s Award recipient and the Chair selects the Chair’s Award recipient. WSCPA Members may submit nominations for next year’s awards at www.wscpa. org or contact the Society. Nominations must be received by March 15, 2013. WashingtonCPA July/August 2012

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Photo Album

Did you know...? Did you know that the AICPA has nearly completed a comprehensive rewrite (Clarity Project) of the Statement on Auditing Standards (SASs)? The majority of the clarified standards will become effective for audits of financial statements for periods ending on or after December 15, 2012. To learn more about the new clarified auditing standards, and how prepare your audit practice for the upcoming year, please register for the following WSCPA course: Audit Efficiency Under the Clarity Standards Dates

Aug 22

Code

SASEF

Location

WSCPA, Bellevue

CPE

8 credits

Register at www.wscpa.org or call (425) 644-4800.

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Elijah Watt Sells Award Presentations The WSCPA recognized Elijah Watt Sells Award recipients from Washington at the Emerging Leaders Conference, May 11 in Redmond. The annual award presented by the AICPA recognizes those with the top 10 CPA exam scores in the nation. 2011 Recipients Andrea Betassa Steven Purvis

Kiely Strohmaier Eric Evans

2010 Recipient

Michael Dean

(Left) 2011 Award recipient Eric Evans, CPA, with Washington State Board of Accountancy Executive Director, Rick Sweeney, CPA.

(Right) Rick Sweeney, CPA, and Mark Hugh, CPA, congratulate Michael Dean, CPA, 2010 Elijah Watt Sells Award recipient.

South King County Chapter Networking @ Tacoma Rainiers May 11 - Cheney Stadium, Tacoma

Reed Keeney, CPA (center) and Dani Espinda, CPA, (right) wearing “All the COOL kids are CPAs” t-shirts.

Nearly 50 people, including student members, attended this fun evening of networking and baseball.

Spokane Golf Outing

May 31 - Circling Raven Golf Club, Worley, ID Congratulations to these teams: Scramble format winners - Luigi’s: Scott Emmanuel, Kurtis Bierlink, Jacob Deacy, and Brad Sollie Best ball format winners - State Bank Northwest: Les Blakely, Greg Deckard, Melanie Potter and Jeff Winkler

John Glenn and Lorrie Rarey, CPA.

UW-Tacoma Accounting Student Association Awards June 7 - Lemay America’s Car Museum, Tacoma

Mike Briggs, CPA, Dani Espinda, CPA, Matt Rettig and April Bergen enjoy a brief conversation prior to the UW-Tacoma Accounting Student Association Awards Banquet at the newly opened America’s Car Museum.

www.wscpa.org


Professional conduct

Professional Conduct Viewpoint:

The Dangers of Being Employed by a Financially Troubled Company By Charles G.Thrash, CPA PAs employed by financially troubled companies may face significant problems, some of which receive little attention by the profession. The Code of Professional Conduct is viewed by many CPAs as mainly for the public practice environment. However, CPAs in business and industry need to be aware of ethical standards that are also applicable to them, as well as situations that may present personal financial jeopardy.

statements or the recording of a transaction. In the case of an unresolved disagreement regarding a material item that renders the financial statements misleading, a change of employment may be necessary to comply with this interpretation. As an integral component of Rule 102, a CPA in business and industry must communicate with the employer’s external accountant in a candid manner and not knowingly misrepresent or fail to disclose facts.

An almost daily event for a CFO/controller is dealing with vendor credit applications. How many of these are signed without a careful reading of the fine print near the signature line? Rule 102 contains the requirement for integrity and objectivity. For the nonpublic CPA, the rule contains the prohibition against preparing, causing others to prepare, or being associated with false or misleading financial statements. Furthermore, the rule also prohibits knowingly signing, permitting, or directing others to sign a “document” containing false or misleading information. The word “document” is not defined and therefore should be interpreted broadly. Interpretation 102-4 (Subordination of Judgment by a Member) contains the recommended steps that the CPA should follow when a dispute or disagreement with their supervisor develops relating to the preparation of financial

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©istockphoto.com/Jesper Elgaard Photography

C

An almost daily event for a CFO/controller is dealing with vendor credit applications. How many of these are signed without a careful reading of the fine print near the signature line? This fine print often contains a personal guarantee by the signer. In the event of nonpayment by the company, the signer may find himself in a collection action by the vendor. One of the broadest ethics rules, Rule 501 (Acts Discreditable) includes an example of an ethics violation for failure to timely remit all payroll and other taxes collected on behalf of others. The unfortunate CPA who diverts funds away from tax trust fund liabilities in order to pay other employer obligations may also find

himself in a situation that leads to personal financial jeopardy. Similar to being locked in a cage with an 800 pound gorilla, the CFO/controller who has been deemed to be a “responsible party” in a section 6672 trust fund recovery penalty action can be held personally liable for the 100 percent unpaid payroll tax penalty. For this penalty to apply, both the intent not to pay and control of funds must exist. A common defense was to assert a lack of control because of not being able to sign on the company bank accounts. However, with the transition to the Electronic Federal Tax Payment System (“EFTPS”) for the payment of payroll taxes, a CFO/ controller who authorizes payments via EFTPS but is not an authorized check signer may still possess the “control of funds” element required for the penalty to apply. Employment by a financially distressed company presents unique and significant ethical challenges for the CPA/CFO/ Controller. Continued awareness of the dangers and knowledge of the ethical requirements are needed to avoid a situation somewhat like sitting in a deck chair on the Titanic.

To take a closer look at the AICPA Professional Code of Conduct, go to: www.aicpa.org (Public > Code of Conduct). Charles G. Thrash, CPA, is a sole practitioner in Auburn,Washington, and a member of the WSCPA Professional Conduct Committee. You can contact him at cgtcpa@aol.com.

WashingtonCPA July/August 2012

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ethics

Courage: The Key to Ethical Behavior By Donald L. Ariail, DBA, CPA, CFF, CVA; Jerry B. Hays, CPA, CIA; and Sandra Vasa-Sideris, Ph.D.

D

©istockphoto.com/Laflor Photography

espite the specific requirements for ethical behavior contained in the Principles of Professional Conduct (Code) of the American Institute of CPAs (AICPA),1 accounting frauds have found CPAs guilty of acting in their personal instead of the public’s best interest. If it is assumed that CPAs are generally knowledgeable regarding the ethical prescriptions of the Code – that is, they know the difference between right and wrong professional conduct – was acting out of self interest the only character trait involved in their unethical conduct? The authors suggest that the virtue of courage is also an essential ingredient of ethical behavior in that it provides the philosophical and psychological backbone that is essential for ethical action. Winston Churchill stated that “without courage all virtues lose their meaning.”2 Similarly, ethical guidance, like that contained in the Code, becomes effective only to the extent that CPAs have the courage to implement it.

Philosophy

Throughout history, courage has been viewed as a virtue. While early philosophers discussed courage mostly in terms of bravery in battle,3 their writings form the foundation of our understanding of the term. According to the ancient Greeks, courage was one of the virtues.4 Socrates viewed courage as “acting to further an ethical ideal.”5 For Aristotle, “what differentiates courage from rashness … is the use of reason combined with a noble goal … and training in the virtues was considered essential to their development.”6 For Confucius, wisdom, benevolence and courage composed “the three cardinal virtues.”7 In The Analects, he stated that “faced with what is right, to leave it undone shows a lack of courage.”8 Building on the foundation of

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courage as a virtue, psychologists propose that it is one of the key components of ethical decision making.

Psychology

Much significant research in psychology has focused on the cognitive means by which individuals make moral judgments (e.g., Piaget9 and Kohlberg10). Rest, Narvaez, Bebeau and Thoma define moral judgment as “judging which actions would be most justifiable in a moral sense.”11 Finding that moral judgment theory did not adequately explain all of the psychological determinants of ethical behavior, James Rest developed his Four-

Component Model, which included moral sensitivity, moral judgment, moral motivation and moral character.12 According to Rest’s Model, four things need to happen in order for people to act ethically: they must recognize that an ethical situation exists (moral sensitivity); they must make a judgment about what is right or wrong (moral judgment); they must choose moral values over personal values such as greed (moral motivation); and they must have the courage to take the ethical action (moral character).13 While all four components of Rest’s Model may be important determinants of the ethical behavior of CPAs, this article focuses on www.wscpa.org


ethics

the last listed component – moral character as categorized by courage.

Prescriptive

The Preamble to the Code requires AICPA members to exhibit both “… selfdiscipline above and beyond the requirements of laws and regulations”14 “and … an unswerving commitment to honorable behavior, even at the sacrifice of personal advantage.”15 The Code’s additional ethical requirements include the exercise of moral judgment,16 acting with integrity,17 and exhibiting character traits such as being “… honest and candid … [and] observe[ing] both the form and the spirit of technical and ethical standards.”18 Moreover, members should “… avoid any subordination of their judgment.”19 A key driver of these normative ethical prescriptions is concern for the professions’ “public interest responsibility … defined as the collective well-being of the community of people and institutions the profession serves.”20 “All who accept membership in the American Institute of Certified Public Accountants commit themselves to honor the public trust.”21 Thus, a key role of the Code is to maintain the public’s trust by providing guidance for concrete moral actions that often require personal courage – that is, not only knowing the ethical course of action through an understanding of the Code, but also having the courage to take the ethical action. Courage is defined in the Random House Dictionary of the English Language as “the quality of mind or spirit that enables one to face difficulty, danger, pain, etc., with firmness and without fear; to act in accordance with one’s beliefs, [especially] in spite of criticism.”22 Accounting scandals in the late 1990s and the early 2000s revealed unethical actions on the part of CPAs that illustrate a lack of personal courage. Nevertheless, there were also instances of CPAs exhibiting exemplary ethical behavior that required a high level of personal courage.

Uncourageous CPAs

Aaron Beam, CPA and cofounder (along with CEO Richard Scrushy) of HealthSouth, started down the slippery www.wscpa.org

slope of unethical behavior when he agreed to falsify financial reports for what was supposed to be a “one-time fix.” From the initial public offering (IPO) in 1986 to the second quarter of 1996, HealthSouth underwent steady and substantial growth; however, in that quarter, for the first time, earnings were not going to meet expectations. With pressure from Scrushy, Beam agreed to alter the accounting records to

Accounting scandals in the late 1990s and the early 2000s revealed unethical actions on the part of CPAs that illustrate a lack of personal courage. Nevertheless, there were also instances of CPAs exhibiting exemplary ethical behavior that required a high level of personal courage. make up for a $50 million shortfall. Then 10 years later, business reporter Seth Fox said that Beam: “… thought the company would only fix the books for that quarter. That, along with his fear that reporting the shortage would cripple the company he viewed as his own, robbed him of any courage or moral strength to oppose the move. Beam also later commented about it. “I knew if we did report bad earnings, it would be disastrous,” said Beam. “I let myself slip into agreeing to commit fraud.”23 Faced with perpetuating the fraud, Beam retired and distanced himself from the company. However, the fraud continued, and in 2003 the CFO at that time, Weston Smith, faced with the significantly heavier penalties brought about by the enactment of the Sarbanes-Oxley Act, reported the fraud. As the case was

being investigated, Beam finally stepped forward, pled guilty, and testified against Richard Scrushy. Beam was sentenced to three months in federal prison and incurred over $500,000 in penalties and attorneys fees.24 If Beam would have just said “no” to Scrushy, the fraud would have been stopped at its inception, and his professional life and that of several subsequent CFOs would have been saved. More importantly, a lack of courage at this critical point resulted in a fraud that harmed not only the public, but also the reputation of the accounting profession. Once one starts down the slippery slope of unethical behavior, it is very hard to put on the brakes. Another example involved David Friehling, CPA, who for 17 years attested to the fairness of the financial statements of the largest Ponzi scheme in history, that of Bernie Madoff. After Madoff turned himself in, David Friehling was the next one arrested. Friehling subsequently pled guilty to nine criminal counts related to the fraud and admitted that he had never performed an independent audit of Madoff’s financial statements, but simply “trusted” Madoff and accepted the financial information provided and certified the statements.25 While Friehling continued to deny that he knew about Madoff’s Ponzi scheme, U.S. prosecutor Preet Bharara stated that, “David Friehling was one of the key enablers of Bernard Madoff’s historic fraud.”26 Freihling lacked the ability to stand up to the pressure exerted by this lucrative source of income. He subordinated his professional judgment to gain a personal advantage and lacked the ethical character traits of a CPA. Freihling chose the unethical path, which requires courage in the sense of a gambler accepting the risk of being caught, but not courage in the sense of a professional with “… an unswerving commitment to honorable behavior, even at the sacrifice of personal advantage.”27

Courageous CPAs

An example of professional courage in the face of a massive fraud perpetrated by boy-band impresario Lou Pearlman was chronicled in Hit Charade.28 WashingtonCPA July/August 2012

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Over two decades, Pearlman built a complex conglomerate of seemingly highly successful businesses: charter air service, real estate, food, CD manufacturing and a myriad of others, topped off by his wizardry with the Backstreet Boys and NSYNC. Pearlman seemed to have a golden touch that brought in bankers and investors who lined up to get in on his run of success. However by early 2006,

showed that all of the retirement plan money had been converted by Pearlman. After noting that almost all of the statements were shown as audited by the firm of Cohen and Siegel, Glover remarked, “I’ve seen poor accounting work before, but I thought, ‘Wow, this is a shoddy firm.’”29 With that thought in mind, Glover dialed the number of Cohen and Siegel and noticed that the

his commitment to ethical behavior. He had the courage in the face of temptation to do the ethical act – he didn’t just fire his unethical client, he turned him in to the authorities. Cynthia Cooper, former vice president of internal auditing at WorldCom, demonstrated moral courage in exposing significant accounting irregularities in the company that, in the end, resulted in

phone on Pearlman’s desk rang. Glover dialed the number again, and again the phone on Pearlman’s desk rang – the first indication that there was, in fact, no CPA firm by the name of Cohen and Siegel. The independent audits, and even the audit firm itself, were fabrications, as was much of Pearlman’s success. Using his knowledge of accounting (in 1976, Pearlman earned a degree in accounting from Queens College), Pearlman had for years falsified financial statements and tax returns. Armed with enough evidence to put a stop to this massive fraud and implicate most of those involved, Paul Glover turned the documentation over to authorities.30 Despite having a lucrative engagement and association with a famous client, Glover did not subordinate his professional judgment, but maintained

federal investigations, criminal and civil suits, the imprisonment of corporate executives, fines against corporate directors, corporate bankruptcy and the eventual acquisition of the company by Verizon. Extraordinary Circumstances: The Journal of a Corporate Whistleblower31 recounts Cooper’s efforts, supported by her trusted staff, to pursue what would turn out to be the largest case of fraud at the time. Cooper was persistent in overcoming significant hurdles in pursuit of the truth: the chief financial officer’s (CFO’s) attempts to delay her work, deliberate efforts by the CPA controller to block access to accounting data, as well as to divert her attention from the problem areas to other auditing projects, and efforts to obscure improper accounting entries in a complex maze of

with Justice Department and Internal Revenue Service (IRS) investigations in progress, Pearlman brought in CPA Paul Glover as a consultant to help save his “sinking ship.” Glover, described by Gray as “a straight shooting Eliot Ness of the accounting world” quickly found indications of what was, at the time, the largest Ponzi scheme in U.S. history, approaching half a billion dollars. Glover focused on Pearlman’s in-house retirement plan, which had also been opened for public investment. While the retirement plan had been advertised as being backed by the Federal Deposit Insurance Corporation (FDIC) and insured by both American International Group (AIG) and Lloyd’s of London, Glover found no such backing because, ironically, there were no accounts. Instead, the documentation

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©istockphoto.com/Laflor Photography

It is much better to lose a client who wants to “push the envelope” with his/her tax deductions than to risk potential professional sanctions, including the loss of the CPA’s license to practice, the loss of the ability to practice before the IRS, and/or the loss of a CPA’s most valuable asset – his/her professional pride and reputation.

www.wscpa.org


ethics

unsupported accounting transactions. Even the chair of the audit committee encouraged her to wait for direction from the CFO. In spite of these challenges and personal fear about the ramifications of her findings, Cooper demonstrated moral courage in doing what she knew was right. Her book would be more aptly titled Extraordinary Courage.

Daily Practice Examples

In the previous examples, ethical courage was exemplified by the actions of CPAs Cooper and Glover, while a lack of ethical courage was exhibited by CPAs for Madoff and HealthSouth. These well-publicized examples of ethical and unethical actions are familiar to most practitioners. Nevertheless, the authors contend that the activation of the courage component of ethical behavior is also required in the daily practice of CPAs. For example, in tax practice it is not unusual for clients to provide CPAs with tax deductions that appear unreasonable. If the CPA questions a deduction and the client provides an adequate explanation or documentation to support the amount claimed, an ethical problem does not arise. However, an ethical problem may arise when a client refuses to adequately explain a problematic deduction, especially one that could result in the IRS penalizing the client and perhaps the CPA for substantially understating the taxpayer’s liability32 and tells the CPA to “just go ahead and put the deduction on my return.” Let’s assume that this individual has been a good client for many years, that the annual fees paid for tax return preparation and other accounting services are material to the firm, and that this client is an influential business person in the community – especially influential with other firm clients. What should the CPA do? The CPA must have the courage to stand up to the client and refuse to be connected with the return. It is much better to lose a client who wants to “push the envelope” with his/her tax deductions than to risk potential professional sanctions, including the loss of the CPA’s license to practice, the loss of the ability to practice before the IRS, and/or www.wscpa.org

the loss of a CPA’s most valuable asset – his/her professional pride and reputation. By acquiescing to the client’s demands, the CPA violates the Code by subordinating his/her professional judgment to that of the client.33 Another example is where a staff accountant working on an over-budget audit engagement is instructed by a supervising senior to skip a required procedure while indicating on the working paper that the procedure was completed. This accountant could take the easy but unethical route of being a “good soldier” (which is never an adequate justification for following the unethical instructions of superiors) and succumb to the senior’s demands. It is much harder to be courageous by taking the ethical stance that requires not only refusing the request to be dishonest,34 but also by going up the chain of command (as required in the Institute of Management Accountants’ ((IMA)) Statement of Ethical Professional Practice35) to report the unethical demand of the senior. In the opinion of the authors, merely refusing to take the unethical act is not enough. Acting in the profession’s and public’s best interest demands that CPAs also follow the precepts of the Honor Code of the U.S. Military Academy by not tolerating the unethical behavior of others.36 Rejecting new clients may also require the exercise of courage. It takes courage to refuse a potentially lucrative engagement when an investigation of the prospective client, as required by the AICPA Quality Control Standards,37 reveals prior illegal, unethical or questionable acts or transactions. Especially for a small CPA firm, it may be very difficult to turn away a client who could bring in a substantial amount of revenue. Disengaging from a current client who has proven to be unethical can be even more difficult. A CPA who has worked with a client for a number of years has probably developed a personal relationship with that client and may rationalize that an unethical act committed or requested by the client was an isolated incident or at least one that could be managed in the future. Nevertheless,

CPAs must sacrifice potential personal and firm advantage38 in order to minimize their “… association with a client whose management lacks integrity … .”39

Ethics in Matters Large or Small

Courage was seen by ancient philosophers as one of the cardinal virtues. More recently, psychologists have identified this virtue as one of the key drivers of ethical behavior. Personal and professional courage is required by CPAs in following the rules and spirit of the Code. Recent accounting scandals give us examples, on the one hand, of CPAs who acted out of self interest and lacked ethical courage and, on the other hand, of CPAs who behaved ethically and exhibited great personal and professional courage. CPAs in daily practice are often challenged to act ethically. To avoid becoming the CPA involved in a “big scandal” or being one who loses his/her license to practice, it is important that ethics be practiced in the small matters encountered in daily practice. Ethical behavior cannot be turned on and off at will. By having the courage to always behave ethically, CPAs will avoid starting down the slippery slope of unethical behavior where what at first appears to be a small or one-time concession (as happened at WorldCom and HealthSouth) mushrooms into a major violation of the public’s trust. As stated by C. S. Lewis,“courage is not simply one of the virtues, but the form of every virtue at the testing point.”40 Donald L. Ariail, DBA, CPA, CFF, CVA, is an associate professor and accounting program coordinator in the Department of Business Administration at Southern Polytechnic State University in Marietta, Ga. He may be contacted at ariailcpa@aol.com. Jerry B. Hays, CPA, CIA, is an adjunct professor at Austin Community College and a doctoral candidate at Nova Southeastern University in Austin, Texas. He may be contacted at jbhsource@gmail.com. Sandra Vasa-Sideris, Ph.D., is a professor and graduate program coordinator in WashingtonCPA July/August 2012

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the Department of Business Administration at Southern Polytechnic State University in Marietta, Ga. She may be contacted at svasasid@spsu.edu. Reprinted with the permission of Today’s CPA, a publication of the Texas Society of Certified Public Accountants. This article represents the opinions of the author(s) and are not necessarily those of the Texas Society of Certified Public Accountants.

Footnotes

1. American Institute of Certified Public Accountants (AICPA), Professional Conduct Standards, vol. 2 (New York: AICPA, 2002). 2. “Winston Churchill.” Great-Quotes.com. Gledhill Enterprises, 2011. 20 Apr. 2011. http://www.great-quotes. com/quote/381903 3. Dan Putnam, “Psychological Courage,” Philosophy, Psychiatry, & Psychology 4.1 (1997): 1-11. 4. Christopher Rowe, “Ethics in Ancient Greece,” A Companion to Ethics. Peter Singer (ed.) (Oxford, England: Basil Blackwell, 1993):12. 5. Robert E. Goodin, “Utility and the Good.” A Companion to Ethics. Ed. Peter Singer. (Oxford, England: Basil Blackwell, 1993): 253. 6. Dan Putnam, “Psychological Courage,” Philosophy, Psychiatry, & Psychology 4.1 (1997): 1-11. 7. Lisheng Chen, “Courage in the Analects: A Genealogical Survey of the Confucian Virtue of Courage.”

Frontiers of Philosophy in China 5.1 (2010): 2 21 Feb. 2011. http:// scienceofvirtues.org/blogs/publications/archive/2010/04/19/ courage-in-the-analects-a-genealogical-survey-of-the-confucian-virtue-of-courage.aspx 8. Confucius. The Analects, trans. D. C. Lau (London: Penguin Books, 1979): 66, II:24. 9. Jean Piaget, The Moral Judgment of the Child, trans. M. Gabin, (1932; New York: Simon & Schuster, 1987). 10. Lawrence Kohlberg, “The Development of Modes of Moral Thinking and Choice in the Years 10 to 16,” diss., U. of Chicago, 1958. 11. James Rest, Darcia Narvaez, Muriel J. Bebeau, and Stephan J. Thoma, Postconventional Moral Thinking: A NeoKohlbergian Approach (Mahwah, NJ: Lawrence Erlbaum, 1999). 12. James Rest, J. (1983). “Morality” in J. Flavel, E. Markman, and P.H. Mussen (eds.), Handbook of Child Psychology: Vol. 3, Cognitive Development (4th ed., (New York: Wiley, 1983): 856-929. 13. Rest, Narvaez, Bebeau, & Thoma. 14. American Institute of Certified Public Accountants (AICPA), Professional Conduct Standards, Volume 2. (New York: AICPA. 2002): ET § 51.01 15. AICPA, ET § 51.02. 16. AICPA, ET § 52. 17. AICPA ET § 53.02. 18. AICPA ET § 54.02 & ET § 54.03. 19. AICPA ET § 55.02. 20. AICPA ET § 53.01. 21. AICPA ET § 53.04. 22. “Courage,” Random House Dictionary of the English Language, 2001 ed. 23. Seth Fox, “A World Unraveled.” Baton Rouge Business Report. (1 Aug. 2006): n.pag. 10 Mar. 2011. http://www.bus. lsu.edu/accounting/faculty/lcrumbley/unraveled.htm 24. Fox.

Banking on Your Terms

25. Diana B. Henriques, “Madoff’s Accountant Pleads Guilty in Scheme,” The New York Times. (3 Nov. 2009). 8 Mar. 2011. http://www.nytimes.com/2009/11/04/ business/04madoff.html?ref=davidgfriehling 26. Andrew Clark, “Madoff Auditor Pleads Guilty to Fraud,” Guardian.co.uk (3 Nov. 2009). 10 Mar. 2011. http://www. guardian.co.uk/business/2009/nov/03/madoff-auditor-pleadsguilty-to-fraud 27. AICPA ET § 51.02. 28. Tyler Gray, The Hit Charade (New York: HarperCollins, 2008). 29. Gray 11. 30. Gray. 31. Cynthia Cooper, Extraordinary Circumstances: The Journey of a Corporate Whistleblower (Hoboken, NJ: John Wiley & Sons, 2008). 32. IRC § 6701. 33. AICPA ET § 55.02. 34. AICPA ET § 54.02 & ET § 54.03. 35. “IMA Statement of Ethical Professional Practice,” IMA: The Association for Accountants and Financial Professionals in Business, n.d. 21 Feb. 2011. http://www.imanet.org/ PDFs/Public/CMA/Statement%20of%20Ethics_web.pdf 36. “Information paper on ‘honor” – A bedrock of military leadership.” MACC-S-HON. Cadet Honor Committee Home Page, United States Military Academy at West Point, 8 May 1998. 21 Feb. 2011. www.usma.edu/committees/honor/ info/main.htm 37. AICPA QC § S20.14. 38. AICPA ET § 51.02. 39. AICPA QC § 20.14. 40. “C.S. Lewis.” Great-Quotes.com. Gledhill Enterprises, 2011. 20 Apr. 2011. http://www.great-quotes.com/ quote/32654

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EUGENE / SPRINGFIELD

WashingtonCPA July/August 2012 24 PAC-063_Hauser_WA-SocCPAs_4C_7.375x4.875_JulyAug2012.indd

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PORTLAND / VANCOUVER

THERIGHTBANK.COM

877-231-2265

5/1/12 10:06 AM www.wscpa.org


Washington CPA Foundation

Washington CPA Foundation: Recognizing Scholarship Contributors By Kimberly Scott, CAE, Executive Director,Washington CPA Foundation

A

s a parent of two children, one in college and one entering this fall, I personally understand the cost of college education. Education costs keep rising every year and many students need to work a couple of jobs while attending school to be able to afford it. It makes scholarships all that more important. A major component of the Washington CPA Foundation’s mission is to fund scholarships. This year the Foundation awarded $55,000 in scholarships to 19 incredible accounting students. I had the opportunity to meet many of this year’s recipients at the Foundation Reception held on May 10. The students I met shared their unique dreams and expressed sincere gratitude for the scholarships. Hearing these stories confirmed how important it is for the Foundation to fund scholarships. The increase in the amount of scholarship dollars awarded this year is due

largely to the named scholarship program. This program, instituted by Trustee Joe Sambataro (also WSCPA Volunteer of the Year, see page 16) allows an individual, company or group to contribute and name a $3,000 scholarship. Many of the contributors met the recipient of their scholarship this year either at the reception or when the scholarships were presented at the student’s school. This year’s named scholarships include: • TrueBlue Inc Scholarship • Ernst & Young LLP Accounting Scholarship • Moss Adams LLP Accounting Scholarship • Sambataro Family Foundation Accounting Scholarship • Shimer Family Accounting Scholarship • PwC LLP Accounting Scholarship

• •

KPMG LLP Accounting Scholarship Wells Fargo Accounting Scholarship

Additional scholarships included: • Roy J Polley Memorial Scholarship • George Waterman Memorial Scholarship • Northwest Accounting Educator Scholarships (3 this year) The Foundation awarded six additional $3,000 scholarships thanks to the generous contributions of many WSCPA members. Every contribution helps, whether $50 or $2,500, and is tax deductible.Your gift will benefit a future CPA. You can contact Kimberly Scott at kscott@wscpa.org or (425) 586-1108.

Foundation Reception May 10, 2012 - The Rainier Club, Seattle

Foundation Trustees Joe Sambataro (left) and Bob Cole, CPA, (right) with Michael Plengrat, 2010 scholarship recipient (center)

Linda Polley and scholarship recipients Tracy Sager www.wscpa.org (WWU) and Aaron Erickson (CWU)

Scot Studebaker, CPA, and Brian Parsons, CPA

Nap Lucchini, CPA Inactive; Dianne O’Neill, CPA; and Michael O’Neill, CPA Inactive

(Front, l. to r.) Jessica Andrews, CPA, and Porsche Everson (Back, l. to r.)Susie Thomson-Sines, CPA, Matthew Herring, and Nolan Heintz

WashingtonCPA July/August 2012

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Technology Tip

©istockphoto.com/Neustock

Working with Column Headers in Excel Tables By K2 Enterprises

A

dded to Excel in the 2007 release, tables are one of the most significant enhancements to the application in many years. Yet, working with column headers in Excel tables can sometimes prove to be problematic. In this tip, you will learn how to handle calculations

Did you know...? Did you know that as of June 15, 2011 Statement on Standards for Attestation Engagements (SSAE) No. 16 supersedes Statement on Auditing Standards (SAS) No. 70? Companies that perform outsourced services that affect the financial statements of another company or companies that receive such services need to be aware of the changes. To learn more about the new SSAE16, it’s implications and how it will affect your financial statements, please register for the following WSCPA webcast:

that refer to data stored as table column headers. Tables treat all column headers, including dates and numbers, as text strings. Though this normally does not create too many issues for those building formulas in tables, if you intend the column header to behave like a number or like a date in a formula, you may need to make adjustments in your formulas. Consider, for instance, the table and formula pictured in Figure 1. The formula compares the year of the acquisition date to the column header to return a value of TRUE or FALSE. However, as constructed, the formula fails to calculate correctly because it is comparing a number from the Acquisition Date column to text from the column header. Of course, Excel forces this result because Excel always treats table headers as text. A slight alteration of the formula is all that is necessary to cause it to calculate

correctly. As shown in Figure 2, merely adding a VALUE function to the section of the formula that refers to the column header causes the formula to calculate correctly. Excel’s VALUE function converts text strings that represent numbers into the number they represent. Knowing that Excel treats all table column headers as text strings is the first step to resolving any issues you may experience when referring to column headers in formulas. Further, knowing that you can use Excel’s VALUE function to convert the text string to a numeric value allows you to easily build formulas that reference table column headers. For a video demonstration of this tip, please visit www.tinyurl.com/k2tips110. K2 Enterprises provides WSCPA members with CPE courses on technology topics. Visit the CPE/Event Catalog at www.wscpa.org for a schedule of courses.

Figure 1 - Formula Referring to Text Column Header

WEBCAST - SSAE16: The New Standard for Service Organization Reporting Dates

July 12

Code

WEB045

Location

Your Desk

CPE

2 credits

Register at www.wscpa.org or call (425) 644-4800.

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WashingtonCPA July/August 2012

Figure 2 - Formula Correctly Calculating Based on Text Column Header www.wscpa.org


www.wscpa.org

WashingtonCPA July/August 2012

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Financial Literacy

Summers and budgets? By Amy O’Donnell,WSCPA Member Services Manager

P

lacing the words summer and budget together seems like a bad joke. You generally won’t hear people talk about how excited they are to review their budgets this summer, but you may hear about their vacation plans. Although Americans tend to use less vacation time than many of our international neighbors, we do try to make the most of our vacations. Oftentimes it is tempting to go beyond your means with vacations. At the end of year we see a flood of articles with tips on planning financial goals for the next year. During the rest of the year these types of articles tend to be less frequent. It may be time to rethink that approach. During the spring and summer months we come out of hibernation to tackle personal and home projects­—start working out, clean out the garage, etc. Why not add reviewing financial goals to the summer to do list? Sure, it doesn’t compare to having fun in the few months of sun, but it will keep you on track and make the New Year’s resolutions less painful, and perhaps more successful. After all,

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budgeting and staying on track are an ongoing process. The recent economic challenges forced many families to evaluate their spending. The upside is the average credit card debt for low to middle income people is down to $7,145 (from $9,887 in 2008). The downside is 51% said that cost of living expenses contributed to their credit card debt. For some, this is a result of regaining employment but with a reduced salary. The adjustment can be challenging and require some tough choices. CPAs that volunteer to make presentations on money management topics have shared with me over the years the challenge of helping people understand budgeting, the importance of having a plan and reviewing it on a regular basis. Budgeting isn’t an exciting topic for most. Combine this with the underlying challenge that learning how to budget may force them to change their past habits, and you have a recipe for resistance. Whether the decision to change your spending habits is by choice or force, you

still need willpower and the tools to be successful. I recently read about how our brains strive for efficiency and part of that is sticking with the path of least resistance. You may start off strong, but your brain will want to go back to what it knows-- even if it is not the best path. This is why you may feel your willpower dwindling when you try to make changes. Anyone who has been unsuccessful on a diet can relate. Budgeting tools like those on Mint.com or similar systems can help. They send you notifications when you have exceeded your budget in a category to help keep you on track. CPAs can assist clients, community groups, family members and friends with embracing budgets as a means of reaching their life goals. WSCPA members can download materials and worksheets from the Financial Literacy section of www.wscpa.org. Helping others implement a regular financial checkup can save them a headache at the end of the year. Amy O’Donnell oversees the Society’s Financial Literacy Program. You can contact Amy at aodonnell@wscpa.org.

www.wscpa.org


CPE Digest WSCPA webcasts Budget Resource PrioritiesHow Reality-Based Budgeting Really Works!

(2 of 6 of the Budgeting Series)

A realistic budget system helps executives monitor the pulse of their organization. Ron Rael’s webcast, Budget Resource Priorities - How Reality-Based Budgeting Really Works! (2 of 6 of the Budgeting Series), will give you the tools you need to redefine the budget from a “to do list” item to a definition of your firm’s potential. Learn how to evaluate your own budgeting process to see if the key components exist and are working. Identify the elements of planning that are missing, and find solutions to the inherent weaknesses. This webcast qualifies for three technical CPE credits and is offered on July 23.

Estate and Gift Taxation: Preparing Forms 706 and 709Understanding the Issues Tax compliance issues at death are sometimes confusing to practitioners because many lack experience in this area. Art Werner’s webcast, Estate and Gift Taxation: Preparing Forms 706 and 709 - Understanding the Issues, provides you with a practical understanding of the issues involved in preparing the federal estate tax return (Form 706), the federal gift tax return (Form 709), and the decedent’s final federal income tax return (Form 1040). Thanks to technology, you have several opportunities to catch this webcast, which qualifies for four technical credits: DATE

July 16

October 22

November 26

December 17

DATE

July 23

Aug 16

Dec 5

TIME

8am-12pm

8am-12pm

8am-12pm

8am-12pm

TIME

11am-2pm

2-5pm

11am-2pm

CODE

WEB048

WEB117

WEB155

WEB193

CODE

WEB061

WEB083

WEB173

View a sample of this webcast by scanning the QR code below, or visit the WSCPA channel on YouTube (www.youtube.com/user/WashingtonCPAs).

The CEO of the High Road Institute, Ron Rael has trained and coached thousands of leaders and business professionals throughout the United States and Canada.

View a sample of this webcast by scanning the QR code below, or visit the WSCPA channel on YouTube (www.youtube.com/user/WashingtonCPAs).

Art Werner, a shareholder and President of Werner Rocca Seminars, Ltd., has presented more than 2,000 eighthour seminars over the past 20 years.

WSCPA webcasts

www.wscpa.org

Budget Resource Priorities - How Reality-Based Budgeting Really Works! (2 of 6 of the Budgeting Series)

Estate and Gift Taxation: Preparing Forms 706 and 709 Understanding the Issues

To view the complete schedule of WSCPA webcasts go to page 33.

WashingtonCPA July/August 2012

Take a test drive

Scan these QR codes with your smart phone barcode scanner app to watch samples WashingtonCPAs of these webcasts.

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Conferences

Far m Tax Conference

Nor thwest Accounting Educator s Conference

August 16 | 8:00 a.m. - 4:00 p.m. Three Rivers Convention Center, Kennewick, WA

September 5-6 | 8:00 a.m. - 4:20 p.m. WSCPA Learning Center, Bellevue, WA

Make sure you are aware of the unique opportunities and pitfalls affecting taxpayers in the agriculture industry. The Farm Tax Conference will give you a forum to discuss current issues affecting your farm and ranch clients.

At the Northwest Accounting Educators Conference accounting faculty and professionals will learn about topics, issues and new developments affecting the accounting profession. Register today at www.wscpa.org/ conferences!

Learn from Roger McEowen, the Leonard Dolezal Professor in Agricultural Law at Iowa State University in Ames, Iowa. He will explain what you need to know related to the following hot topics affecting this industry:

• • • • • • • • • • • • •

• • •

Conservation easement tax issues

Gifting of agricultural commodities Like-kind exchange issues Chapter 12 bankruptcy tax issues Tax issues when trading/selling machinery Depreciation issues Hedging vs. speculation Retirement strategies for farmers Tax Issues for timber producers Christmas tree tax issues Tax issues involving orchards, groves and vineyards CRP tax issues Material participation rules for farmers Passive loss issues

8 Technical CPE credits WSCPA Members Non Members

$250 $325

Highlights

Highlights:

• •

• • • • •

A Report from the Pathways Commission

A&A Update Inspiring Students to Be Ethical Leaders IFRS: From the Classroom to Practice Panel: Maximizing the Online Learning Experience Mastering the Accounting Cycle: Using Adaptive Learning and Assessment Software Quality Matters & Improving Course Design Advanced Excel Tricks for Accounting and Finance Business Simulations in Accounting Education CPA Exam Update And much more!

16 CPE credits (minimum of 3 non-technical) Register by July 31 $185 Includes free parking! Register after July 31 $235

Includes free parking!

Register for FARMC at www.wscpa.org/conferences

Not-For-Profit Conference

Register for NAEC at www.wscpa.org/conferences November 15-16 | 8:00 a.m. - 4:30 p.m. Bell Harbor International Conference Center, Seattle, WA Registration options: Webcast option available. 16 CPE credits WSCPA Members Non Members

$425 $500

Includes free parking!

Register for NFPC at www.wscpa.org/conferences 30

WashingtonCPA July/August 2012

Register at www.wscpa.org/conferences www.wscpa.org


Register at www.wscpa.org or page 37

conferences

Pacic Tax INSTITUTE

Accounting & Auditing Conference

October 29-30 | 8:00 a.m. - 4:30 p.m. Bell Harbor International Conference Center, Seattle, WA This is the Tax Institute to attend in Washington State! The Pacific Tax Institute, a conference designed for experienced tax professionals, will explore the many changes in federal tax. Spend two and a half days at a stunning waterfront setting, taking a close look at important current federal tax issues that affect you and your clients. Prepare to be awed by this event’s remarkable speakers and the beautiful location in Seattle’s waterfront district. Enjoy remarkable panoramic views of the Olympic Mountains, Mt. Rainier, Puget Sound’s Elliott Bay and the Seattle skyline from a worldclass venue: Bell Harbor International Conference Center. At continental breakfasts, lunch and refreshment breaks, you will enjoy fresh and innovative Northwest-inspired cuisine and a fine array of distinctive refreshments, served by the center’s awardwinning culinary team. Bell Harbor is just a short walk from the Marriott - Seattle Waterfront, the official hotel of the Pacific Tax Institute.

Registration options: Register for both days or one day. Or participate via webcast. FEES 2 days WSCPA Members $700 Non Members $775

1 day $350 $425

Includes free parking!

November 1 | 8:00 a.m. - 4:00 p.m. Bell Harbor International Convention Center, Seattle, WA A&A standards change every time you turn around. And no matter how hard you try to stay aware of the latest developments, you’re bound to miss a critical change. The Accounting & Auditing Conference will provide the crucial guidance you need to stay in compliance with the many A&A rules affecting your practice, business or clients. Register today at www.wscpa.org/conferences! Registration options: Webcast available 8 CPE credits WSCPA Members Non Members

$325 $400

Includes free parking!

Register for AAC at www.wscpa.org/conferences

Pacific NW Constr uction Industr y Conference

Register for PTI at www.wscpa.org/conferences

November 8-9 | 8:00 a.m. - 4:30 p.m. Bell Harbor International Conference Center, Seattle, WA

Learn more at www.wscpa.org/conferences

Co-sponsored by the CFMA, this conference will review recent trends and provide essential guidance on hot topics affecting construction accounting and financial management.

Find conference details (schedules and speaker bios) and register at www.wscpa.org/conferences.

Sponsorships available

Contact Miki McLean at mmclean@wscpa.org for information. Register at www.wscpa.org/conferences www.wscpa.org

16 CPE credits WSCPA Members Non Members

$575 $650

Includes free parking!

Register for CIC at www.wscpa.org/conferences WashingtonCPA July/August 2012

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Register at www.wscpa.org/CPE/catalog or page 37

Education and events

Fees

Date Course events by location WSCPA education and events scheduled for July-August 2012 are # listed below, chronologically by location. If you are looking for a program in another location, it may be scheduled for later in the year. Using the online CPE/Event Catalog at www.wscpa.org/CPE/ catalog, you can search by location. CPE Credits

Type

2012-2013 EVENT SCHEDULE To view the complete schedule of events through May 2013, refer to the CPE/Event Catalog at www.wscpa.org. LEARN MORE To view complete course details, please visit the CPE/ Event Catalog at www.wscpa.org/CPE/catalog.

Code

For more details, search by code at www.wscpa.org/cpe

WSCPA NonAICPA Member Member Member Discount Fee Fee

SUBJECTS The main subject area is listed for each program.

Facility A&A CS EB PFP Ethics GNP

Need help finding a seminar or webcast? Call (800) 272-8273 or (425) 644-4800.

MG PD SK TAX TEC

Subject

Accounting and Auditing Consulting Services Employee Benefits Estate/Financial Planning Ethics Government / NFP Management Personal Development Specialized Knowledge Taxation Technology

Ø

Fees

Date

CPE Credits

#

Course

Type

WSCPA NonAICPA Code Member Member Member For more details, Discount Fee Fee search by code at www.wscpa.org/cpe

Facility

Subject

Bellevue Jul 9

8

Excel Functions, Tips, Tricks & Techniques, 8am-4pm

COMEXF01

250

325

WSCPA

Jul 10

8

Word Tips, Tricks & Techniques, 8am-4pm

COMWT01

250

325

WSCPA

TEC

Jul 16

8

Washington Tax and New Developments, 8am-4pm

WSTX01

285

360

WSCPA

TAX

Jul 17

8

Compilation and Review Standards Update and Review by Walter Haig, 8am-4pm

CRUR01

305

380

WSCPA

A&A

Jul 18

8

GAAP Update and Review for Small and Medium-Sized Entities (SMEs) by Walter Haig, 8am-4pm

GURSME01

305

380

WSCPA

A&A

ç Jul 23

8

New Taxwise Planning Strategies For Closely-Held Businesses (2012), 8am4pm

TPCH

290

365

WSCPA

TAX

ç Jul 24

8

Fresh New Tax Planning And Compliance Ideas That Take Advantage Of Recent Tax Acts And IRS Pronouncements (2012), 8am-4pm

NPRT

290

365

WSCPA

TAX

ç Jul 25

8

Larry Stein’s Update On Tax, Estate And Asset Protection Planning Strategies For Your Wealthy, High-Income Clients, 8am-4pm

LSWC

290

365

WSCPA

TAX

ç Aug 1

8

Advanced Tax Update for Experienced Practitioners, 8am-4pm

ATU

285

360

WSCPA

TAX

ç Aug 2

8

Tax Update for Financial Executives, 8am-4pm

TUFE

285

360

WSCPA

TAX

ç Aug 3

8

Debt Related Tax Issues: Foreclosures, Short Sales and Cancellation of Debt, DRTI 8am-4pm

285

360

WSCPA

TAX

Aug 6

8

Financial Statement Analysis: Basis for Management Advice, 8am-4pm

FSABM

285

360

-30

WSCPA

A&A

Aug 7

8

Advanced Controller and CFO Skills, 8am-4pm

ACCS

285

360

-30

WSCPA

MG

Aug 8

8

Statement of Cash Flows: Preparation, Presentation and Use, 8am-4pm

FCFS

285

360

-30

WSCPA

A&A

Aug 9

8

Accounting for Income Taxes: Applying SFAS No. 109/FIN 48: A Whole New Ballgame! 8am-4pm

AIT

285

360

-30

WSCPA

A&A

Aug 13

8

The Reid Technique of Interviewing and Interrogation, 8am-4pm

RTI

285

360

WSCPA

SK

Aug 14

8

Annual Accounting Update and Review for Accountants in Industry, 8am4pm

AAUDI

285

360

WSCPA

A&A

Aug 14

8

Introduction to QuickBooks for the Accounting Professional, 8am-4pm

COMQB101

250

325

WSCPA

TEC

Aug 15

8

Excel Pivot Tables, 8am-4pm

COMEXP01

250

325

WSCPA

TEC

Aug 16

0

Mingling at the Members’ Reception- Bellevue Club, 6-8:30pm

NP02

Bellevue Club

PD

Aug 17

8

IFRS vs. US GAAP: The Differences That You Need to Know, 8am-4pm

IUGD01

285

360

WSCPA

A&A

Aug 22

8

Audit Efficiency Under the Clarity Standards, 8am-4pm

SASEF

285

360

WSCPA

A&A

Aug 22

8

Taxation of Washington Registered Domestic Partners and Same Sex Married Couples, 8am-4pm

RDP02

285

360

WSCPA

TAX

Aug 23

8

Passive Activity Losses A-Z, 8am-4pm

PAL01

285

360

WSCPA

TAX

Aug 24

8

Inside the IRS - A Tour for CPAs, EAs and Accountants, 8am-4pm

ITI01

285

360

WSCPA

SK

Aug 24

4

Mysterious Interest & Original Issue Discount Rules, 12:30-4pm

MIO401

150

185

WSCPA

TAX

S

ç New |  non-tech credits | E Ethics credits |  Conference | Y Yellow Book | C CFP | l Chapter event |

32

WashingtonCPA July/August 2012

TEC

Networking Event | S Season Ticket and Coupons N/A

www.wscpa.org


Register at www.wscpa.org/CPE/catalog or page 37

Education and events Fees

Date

CPE Credits

#

Course

Type

Unraveling the At Risk Rules, 8-11:30am

Code

WSCPA NonAICPA Member Member Member Discount Fee Fee

Facility

Subject

UAR401

150

185

WSCPA

TAX

1041

295

370

WSCPA

TAX

MLCPA01

285

360

WSCPA

SK

IEFP

295

370

WSCPA

TAX

For more details, search by code at www.wscpa.org/cpe

Aug 24

4

Aug 27

8

Aug 27

8

Aug 28

8

C The Best Income Tax, Estate Tax, and Financial-Planning Ideas of 2012, 8am4pm

16

Accounting and Reporting Standards Annual Update and Review by Walter Haig, 8am-4pm

ARSUR01

535

650

Campbell’s Resort on Lake Chelan

A&A

Accounting and Reporting Standards Annual Update and Review by Walter Haig, 8am-4pm

ARSUR02

535

650

Coeur d’Alene Golf & Spa Resort

A&A

250

325

Three Rivers Conv Ctr

SK

Steam Plant Grill

PD

C Fiduciary Income Tax Returns - Form 1041 Workshop, 8am-4pm Money Laundering - A Guide for CPAs, 8am-4pm

Chelan Jul 19-20

Coeur d’Alene Aug 23-24

16

Kennewick Aug 16

8

Farm Tax Conference, 8am-4pm

FARMC

Jul 10

0

S

Happy Hour Networking Event, 5-7pm

NP06

Aug 13

8

Financial Statement Presentation and Disclosure, 8am-4pm

FSPD01

Aug 14

0

Happy Hour Networking Event, 5-7pm

NP07

Spokane

S

285

360

Hampton Inn Spokane

A&A

Steam Plant Grill

PD

Your Desk - Webcasts and Webinars Jul 6

8

WEBCAST Stopping Fraud in Your Business, 8:30am-4:30pm

WEB037

255

295

Webcast

A&A

Jul 9

3

WEBCAST: Research and Development Tax Credits: Do You Know the Tax Savings These Create?, 9am-12pm

WEB299

99

129

Webcast

TAX

Jul 9

2

WEBINAR Outlook Part 1 - E-Mail Management Tips and Techniques (Basic), 8-10am

WNR031

79

94

Webinar

TEC

Jul 9

2

WEBINAR Outlook Part 2 - E-Mail Management Tips and Techniques (Advanced), 11am-1pm

WNR032

79

94

Webinar

TEC

Jul 10

4

WEBCAST Washington CPA Ethics and New Developments (A WA Requirement), 8am-12pm

WEB038

164

194

Webcast

Ethics

Jul 10

4

WEBCAST Washington Sales Tax and New Developments, 12-4pm

WEB039

129

159

Webcast

TAX

Jul 10

2

WEBCAST International Tax Topics - U.S. Citizens & Resident Aliens Working Abroad, 11:30am-1:30pm

WEB040

79

109

Webcast

TAX

ç Jul 10

2

WEBINAR Adobe Acrobat X (Version 10) - What’s New and Different, 11am-1pm

WNR033

79

94

Webinar

TEC

Jul 10

2

WEBINAR Outlook Part 3 - Calendar & Contact Management Tips & Techniques, 8-10am

WNR034

79

94

Webinar

TEC

Jul 11

8

WEBCAST CPA’s Guide To Tax Planning For Debt Cancellation And Restructuring, 11am-7pm

WEB043

195

245

Webcast

TAX

Jul 11

8

WEBCAST IRAs: Contributions & Distributions for Traditional, Roth, SEP & SIMPLE IRAs, 8:30am-4:30pm

WEB041

255

295

Webcast

TAX

Jul 11

8

WEBCAST Private Foundations Tax Primer, 8:30am-4:30pm

WEB042

255

295

Webcast

TAX

Jul 11

2

WEBINAR LinkedIn - Basic Tips & Techniques for Accounting Professionals, 7-9am

WNR035

79

94

Webinar

TEC

Jul 11

2 6 WEBINAR Using LinkedIn as a Business Development Tool, 10am-12pm

WNR036

79

94

Webinar

TEC

Jul 12

2

WEBCAST SSAE16 The New Standard for Service Organization Reporting, 9-11am

WEB045

79

109

Webcast

A&A

Jul 12

8

WEBCAST The Continuing IFRS Journey: Update on an Uncertain Future, 8:30am-4:30pm

WEB044

255

295

Webcast

A&A

Jul 12

2

WEBINAR Setting Your Audit Staff Up for Success, 8-10am

WNR037

89

104

Webinar

A&A

Jul 12

2

WEBINAR The Pros and Cons of Email Use During the Audit, 11am-1pm

WNR038

89

104

Webinar

A&A

Jul 13

8

WEBCAST Business Valuation: A Review of the Essentials, 8:30am-4:30pm

WEB046

255

295

Webcast

SK

Jul 13

2

WEBINAR Closing Best Practices - Shortening Month End, 8-10am

WNR039

79

94

Webinar

A&A

Jul 13

2

WEBINAR Fraud Alert - How Fraud Can Impact You!, 11am-1pm

WNR040

79

94

Webinar

A&A

E

ç New |  non-tech credits | E Ethics credits |  Conference | Y Yellow Book | C CFP | l Chapter event |

www.wscpa.org

Networking Event | S Season Ticket and Coupons N/A

WashingtonCPA July/August 2012

33


Register at www.wscpa.org/CPE/catalog or page 37

Education and events

Fees

Date

CPE Credits

#

Course

Type

Code

WSCPA NonAICPA Member Member Member Discount Fee Fee

Facility

Subject

For more details, search by code at www.wscpa.org/cpe

Jul 16

4

WEBCAST Estate and Gift Taxation: Preparing Forms 706 and 709- Understanding the Issues, 8am-12pm

WEB048

129

159

Webcast

TAX

Jul 16

2

WEBCAST Post Mortem Estate Planning, 12-2pm

WEB049

79

109

Webcast

TAX

ç Jul 16

4

WEBCAST Top 10 AMT Causes and Planning Strategies, 8:30am-12:30pm

WEB047

99

124

Webcast

TAX

Jul 17

2

WEBCAST The Complete Guide to the Line by Line Preparation of Form 1041, 10am-12pm

WEB050

79

109

Webcast

TAX

ç Jul 17

2

WEBCAST Estate, Financial, and Income Tax Planning for the Non-Traditional Client, 12-2pm

WEB051

79

109

Webcast

TAX

Jul 17

2

WEBCAST Introduction - The Complete Guide to the Preparation of Form 1041, 8-10am

WEB052

79

109

Webcast

TAX

Jul 17

2

WEBINAR New Reporting Rules for Passive Activity Groupings, 7-9am

WNR041

79

94

Webinar

TAX

Jul 17

2

WEBINAR Repairs to Tangible Property - Capitalize or Expense? 10am12pm

WNR042

79

94

Webinar

TAX

Jul 18

2

WEBINAR Excel - Tips for Eliminating Errors from Your Spreadsheets, 11am-1pm

WNR043

79

94

Webinar

TEC

ç Jul 18

2

WEBINAR Excel - How to Build a Spreadsheet for Beginners, 8-10am

WNR044

79

94

Webinar

TEC

Jul 19

4

WEBCAST A-133 Audits - How Can I Do it Better- An Auditor’s Perspective for Auditors and Auditees, 8am-12pm

WEB054

129

159

Webcast

A&A

Jul 19

4

WEBCAST A-133 Audits - What Do I Need to Know? An Auditor’s Perspective for Auditors and Auditees, 12-4pm

WEB055

129

159

Webcast

A&A

ç Jul 19

8

WEBCAST Key Ratio Analysis, 8:30am-4:30pm

WEB053

255

295

Webcast

A&A

Jul 19

2

WEBINAR Excel - Analyze Your Data Using Pivot Tables, 8-10am

WNR045

79

94

Webinar

TEC

Jul 19

2

WEBINAR Excel - Financial Analysis Using Financial Functions, 11am-1pm

WNR046

79

94

Webinar

TEC

Jul 20

4

Y

WEBCAST Yellow Book Audits - What You Need to Know, 8am-12pm

WEB057

129

159

Webcast

GNFP

Jul 20

4

Y

WEBCAST Hud Audits – What You Need to Know, 12-4pm

WEB058

129

159

Webcast

A&A

ç Jul 20

8

WEBCAST Mutual Fund Investing: A Working Knowledge, 8:30am-4:30pm

WEB056

255

295

Webcast

SK

ç Jul 20

2

WEBINAR Nonprofit Boards: Stepping Up to Today’s Challenges, 8-10am

WNR047

79

94

Webinar

GNFP

Jul 23

2

WEBCAST Budget Basics - Myths of Budgeting and How to Overcome Them! (1 of 6 of the Budgeting Series), 8-10am

WEB060

99

129

Webcast

MG

Jul 23

3

WEBCAST Budget Resource Priorities- How Reality-Based Budgeting Really Works! (2 of 6 of the Budgeting Series), 11am-2pm

WEB061

99

129

Webcast

MG

Jul 23

3

WEBCAST Budget Accountability - How to Ensure Accountability Gets Embedded in Your Budget Process! (3 of 6 of the Budgeting Series), 2-5pm

WEB062

99

129

Webcast

MG

Jul 23

8

WEBCAST Accounting and Auditing Update, 8:30am-4:30pm

WEB294

255

295

Webcast

A&A

Jul 23

8

WEBCAST Living Trust Administration Workshop, 8:30am-4:30pm

WEB059

255

295

Webcast

TAX

Jul 23

2

WEBINAR Adobe Acrobat for Accountants I - Basic Features & Functions, 8-10am

WNR048

79

94

Webinar

TEC

Jul 23

2

WEBINAR Adobe Acrobat for Accountants II - Advanced Features & Functions, 11am-1pm

WNR049

79

94

Webinar

TEC

Jul 24

3

WEBCAST Revenue Budgeting - How to Get Your Revenue Forecast RIGHT the First Time! (4 of 6 of the Budgeting Series), 8-11am

WEB063

99

129

Webcast

MG

Jul 24

2

WEBCAST Expense and Cost Budgeting - How to Replace Fat with Reality in Your Expense Budget! (5 of 6 of the Budgeting Series), 11am-1pm

WEB064

79

109

Webcast

MG

Jul 24

2

WEBCAST Capital Budgeting - How to Make Every Capital Dollar Provide Value! (6 of 6 of the Budgeting Series), 1-3pm

WEB065

79

109

Webcast

MG

Jul 24

2

WEBCAST What Does Fraud Look Like? 11am-1pm

WEB296

79

109

Webcast

A&A

Jul 24

8

WEBCAST Other Comprehensive Basis of Accounting Fundamentals, 8:30am-4:30pm

WEB295

255

295

Webcast

A&A

ç Jul 24

2

WEBINAR iPad - How to Use an iPad for Beginners, 8-10am

WNR050

79

94

Webinar

TEC

ç Jul 24

2

WEBINAR iPad - How to Configure Your iPad for Maximum Value, 11am1pm

WNR051

79

94

Webinar

TEC

ç Jul 25

2

WEBINAR S Corporations: Calculation of AAA, Basis Calculations and Loans, 7-9am

WNR052

79

94

Webinar

TAX

ç New |  non-tech credits | E Ethics credits |  Conference | Y Yellow Book | C CFP | l Chapter event |

34

WashingtonCPA July/August 2012

Networking Event | S Season Ticket and Coupons N/A

www.wscpa.org


Register at www.wscpa.org/CPE/catalog or page 37

Education and events Fees

Date

CPE Credits

# ç Jul 25

Course

Type

2

WEBINAR S Corporations: Election, Conversion, and the Built-In Gain Tax, 10am-12pm

Code

WSCPA NonAICPA Member Member Member Discount Fee Fee

Facility

Subject

WNR053

79

Webinar

TAX

For more details, search by code at www.wscpa.org/cpe

94

ç Jul 26

2

WEBINAR Technology: A Blessing or a Curse During the Audit, 8-10am

WNR054

89

104

Webinar

A&A

Jul 26

2

WEBINAR Fieldwork Complete...Is the Audit Complete? 11am-1pm

WNR055

89

104

Webinar

A&A

Jul 27

8

WEBCAST Financial Reporting for Private Companies and SMEs: The Approaching Perfect Storm!, 8:30am-4:30pm

WEB066

255

295

Webcast

A&A

Jul 27

2

WEBINAR IRS Tax Update, 10am-12pm

WNR056

79

94

Webinar

TAX

Jul 30

8

WEBCAST Tax Aspects of Bankruptcy: All Need Not Be Lost, 8:30am4:30pm

WEB067

255

295

Webcast

TAX

Jul 30

2

WEBINAR Creating the Best Projections You Can, 8-10am

WNR057

79

94

Webinar

MG

Jul 30

2

WEBINAR Effective Corporate Governance: Working with the Board and Audit Committee, 11am-1pm

WNR058

79

94

Webinar

MG

Jul 31

2

WEBINAR Microsoft Office 2007/2010 - What’s New? 8-10am

WNR059

79

94

Webinar

TEC

Jul 31

2

WEBINAR Windows 7 - Tips & Techniques, 11am-1pm

WNR060

79

94

Webinar

TEC

Aug 1

2

WEBINAR Tax Depreciation: Review & Update, 10am-12pm

WNR061

79

94

Webinar

TAX

Aug 1

2

WEBINAR Travel & Entertainment Expenses: Review & Update, 7-9am

WNR062

79

94

Webinar

TAX

Aug 3

8

WEBCAST Fundamentals of the Corporate Income Tax Return, 8:30am4:30pm

WEB070

255

295

Webcast

TAX

Aug 3

8

WEBCAST Common Frauds and Internal Controls for Revenue Purchasing and Cash Receipts, 8:30am-4:30pm

WEB069

255

295

Webcast

A&A

Aug 3

2

WEBINAR Excel - Spreadsheet Design Techniques You Must Know - Part 1, 8-10am

WNR063

79

94

Webinar

TEC

Aug 3

2

WEBINAR Excel - Spreadsheet Design Techniques You Must Know - Part 2, 11am-1pm

WNR064

79

94

Webinar

TEC

ç Aug 6

8

WEBCAST Not-for-Profit Organizations: Accounting and Auditing Principles, 8:30am-4:30pm

WEB068

255

295

Webcast

GNFP

ç Aug 6

2

WEBINAR Adobe Acrobat for Accountants III - Tips & Techniques for the Experienced User, 8-10am

WNR065

79

94

Webinar

TEC

ç Aug 6

2

WEBINAR Adobe Acrobat Forms, 11am-1pm

WNR066

79

94

Webinar

TEC

Aug 7

4

WEBCAST Washington CPA Ethics and New Developments (A WA Requirement), 8am-12pm

WEB071

164

194

Webcast

Ethics

Aug 7

4

WEBCAST Washington Sales Tax and New Developments, 12-4pm

WEB072

129

159

Webcast

TAX

ç Aug 7

2

WEBINAR iPad - How to Use an iPad for Beginners, 8-10am

WNR067

79

94

Webinar

TEC

ç Aug 7

2

WEBINAR iPad - How to Configure Your iPad for Maximum Value, 11am1pm

WNR068

79

94

Webinar

TEC

Aug 8

2

WEBINAR Client Portals - How to Develop a Strategic Model, 11am-1pm

WNR069

79

94

Webinar

TEC

Aug 8

2

WEBINAR How to Go Paperless, 8-10am

WNR070

79

94

Webinar

TEC

ç Aug 9

2

WEBINAR iPad - Review of Top Apps for Business Professionals, 7-9am

WNR071

79

94

Webinar

TEC

Aug 10

4

WEBCAST 2012 Banking Financial And Compliance Update Series - Second Quarter Update, 8am-12pm

WEB073

129

159

Webcast

SK

ç Aug 10

2

WEBINAR IFRS Introduction - What You Need to Know, 11am-1pm

WNR072

79

94

Webinar

A&A

Aug 13

4

WEBCAST A-133 Audits - How Can I Do it Better? An Auditor’s Perspective for Auditors and Auditees, 8am-12pm

WEB075

129

159

Webcast

A&A

Aug 13

4

WEBCAST A-133 Audits - What Do I Need to Know? An Auditor’s Perspective for Auditors and Auditees, 12-4pm

WEB076

129

159

Webcast

A&A

Aug 13

8

WEBCAST Fundamentals of 1031 Exchanges, 8:30am-4:30pm

WEB074

255

295

Webcast

TAX

Aug 13

2

WEBINAR Risk Analysis and Management, 8-10am

WNR073

79

94

Webinar

A&A

Aug 14

4

WEBCAST Yellow Book Audits - What You Need to Know, 8am-12pm

WEB077

129

159

Webcast

GNFP

Aug 14

4

WEBCAST Hud Audits – What You Need to Know, 12-4pm

WEB078

129

159

Webcast

A&A

Aug 14

2

WEBINAR Excel - Tips for Eliminating Errors from Your Spreadsheets, 11am-1pm

WNR074

79

94

Webinar

TEC

ç Aug 14

2

WEBINAR Excel - Printing and Formatting Your Spreadsheets, 8-10am

WNR075

79

94

Webinar

TEC

E

Y

ç New |  non-tech credits | E Ethics credits |  Conference | Y Yellow Book | C CFP | l Chapter event |

www.wscpa.org

Networking Event | S Season Ticket and Coupons N/A

WashingtonCPA July/August 2012

35


Register at www.wscpa.org/CPE/catalog or page 37

Education and events

Fees

Date

CPE Credits

#

Course

Type

Code

For more details, search by code at www.wscpa.org/cpe

WSCPA NonAICPA Member Member Member Discount Fee Fee

Facility

Subject

Aug 15

2

WEBINAR Excel - Analyze Your Data Using Pivot Tables, 11am-1pm

WNR076

79

94

Webinar

TEC

Aug 15

2

WEBINAR Excel - How to Build a Spreadsheet for Beginners, 8-10am

WNR077

79

94

Webinar

TEC

Aug 16

2

WEBCAST Budget Basics - Myths of Budgeting and How to Overcome Them! (1 of 6 of the Budgeting Series), 8-10am

WEB081

99

129

Webcast

MG

Aug 16

3

WEBCAST Budget Priorities - How Reality-Based Budgeting Really Works! (2 of 6 of the Budgeting Series), 11am-2pm

WEB082

99

129

Webcast

MG

Aug 16

3

WEBCAST Budget Accountability - How to Ensure Accountability Gets Embedded in Your Budget Process! (3 of 6 of the Budgeting Series), 2-5pm

WEB083

99

129

Webcast

MG

Aug 16

8

WEBCAST Form 1041 Workshop, 8:30am-4:30pm

WEB079

255

295

Webcast

TAX

Aug 16

8

WEBCAST Controls, Risks and Financial Reporting, 8:30am-4:30pm

WEB080

255

295

Webcast

A&A

ç Aug 16

2

WEBINAR Cloud Computing: Taking Your IT Strategy to the Next Level, 8-10am

WNR078

79

94

Webinar

TEC

Aug 16

2

WEBINAR Word - Advanced Tips, Tricks & Techniques, 11am-1pm

WNR080

79

94

Webinar

TEC

Aug 17

3

WEBCAST Revenue Budgeting - How to Get Your Revenue Forecast RIGHT the First Time! (4 of 6 of the Budgeting Series), 8-11am

WEB084

99

129

Webcast

MG

Aug 17

2

WEBCAST Expense and Cost Budgeting - How to Replace Fat with Reality in Your Expense Budget! (5 of 6 of the Budgeting Series), 11am-1pm

WEB085

79

109

Webcast

MG

Aug 17

2

WEBCAST Capital Budgeting - How to Make Every Capital Dollar Provide Value! (6 of 6 of the Budgeting Series), 1-3pm

WEB086

79

109

Webcast

MG

ç Aug 17

2

WEBINAR Recognizing Sham Transactions, 11am-1pm

WNR081

79

94

Webinar

MG

Aug 17

2

WEBINAR The Top 10 Legal Mistakes Companies Make and How to Avoid Them, 8-10am

WNR082

79

94

Webinar

MG

Aug 20

8

WEBCAST 2012 FASB and AICPA Update, 8:30am-4:30pm

WEB087

255

295

Webcast

A&A

Aug 20

2

WEBINAR Excel - Financial Analysis Using Financial Functions, 8-10am

WNR083

79

94

Webinar

TEC

Aug 20

2

WEBINAR XBRL Level 1 - The Next Evolution in Financial Reporting, 11am-1pm

WNR084

79

94

Webinar

TEC

Aug 21

8

WEBCAST Technology for CPA Firms, 8:30am-4:30pm

WEB088

255

295

Webcast

TEC

Aug 21

2

WEBINAR Outlook Part 1 - E-Mail Management Tips and Techniques (Basic), 8-10am

WNR085

79

94

Webinar

TEC

Aug 21

2

WEBINAR Outlook Part 2 - E-Mail Management Tips and Techniques (Advanced), 11am-1pm

WNR086

79

94

Webinar

TEC

Aug 22

2

WEBCAST Managing External Data and How to Get the Most out of Subtotals with Excel, 11am-1pm

WEB089

59

74

Webcast

TEC

Aug 22

2

WEBINAR Outlook Part 3 - Calendar & Contact Management Tips & Techniques, 8-10am

WNR087

79

94

Webinar

TEC

Aug 22

2

WEBINAR Key Tax Issues for Members in Industry, 11am-1pm

WNR088

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Webinar

TAX

Aug 23

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WEBCAST Transfer Pricing: Basic Rules, Structures and More, 10am-12pm

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TAX

Aug 23

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WEBCAST Cash and Credit Management, 8:30am-4:30pm

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WEBINAR New Reporting Rules for Passive Activity Groupings, 8-10am

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WEBINAR Repairs to Tangible Property - Capitalize or Expense?, 11am1pm

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WEBCAST Financial Statement Disclosures for the Tax Practitioner, 8:30am-4:30pm

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WEBINAR Nonprofit Grant Writing: A Financial Manager’s Primer, 8-10am

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Aug 27

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WEBCAST: Research and Development Tax Credits: Do You Know the Tax Savings These Create?, 9am-12pm

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WEBINAR Pricing for Profitability: Why Cost Matters, 8-10am

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ç New |  non-tech credits | E Ethics credits |  Conference | Y Yellow Book | C CFP | l Chapter event |

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WashingtonCPA July/August 2012

Networking Event | S Season Ticket and Coupons N/A

www.wscpa.org


Register at www.wscpa.org/CPE/catalog

Registration

Register online at www.wscpa.org/CPE/catalog or:

Questions? E-mail cpe@wscpa.org or call (425) 644-4800 or (800) 272-8273 (toll-free in Washington).

Code

Title

Date

City

Fee1

2

3

Security code _______

2

WSCPA CPE policies apply to all programs in the CPE Digest. Review the CPE policies at www.wscpa.org. www.wscpa.org

WashingtonCPA July/August 2012

37


classified ads

Detailed advertising information is available online at www.wscpa.org. Ads are $1 per word with a minimum fee of $50. Active e-mail and web site addresses are included. Classified Ads are placed on the website for 60 days when received, and in the next magazine when received by the deadline (July 25 for the September/October issue).Positions available ads are for magazine placement only. To post a job listing, visit the Career Center at www.wscpa.org. Contact Sharon Olene-Marander at (425) 586-1138, (800) 272-8273,Ext.1138,or classifieds@wscpa.org for more information. All ads must be pre-paid. Find classified ads at www.wscpa.org under Newsroom.

Now accepting ads for vacation homes, office equipment, etc. When placing your ad, select “miscellaneous” category.

POSITIONS AVAILABLE

Williams & Nulle, PLLC, a CPA firm located in MountVernon,WA, is seeking a licensed CPA with a minimum of 3 years of public accounting,auditing and tax experience serving small to mid-size privatelyheld companies. Self starter with the ability to work with others and on an individual basis with the goal of someday becoming partner. Strong software skills, including Word and Excel. Salary DOE. Send resume to sdt@wncpa.com. Established Bellingham CPA firm is seeking a tax manager to join our team of professionals. 5+ years of tax experience required. Collaborative working environment, excellent advancement opportunities and salary and benefits package. Submit resume and cover letter toVSH,CPA’s,2200 Rimland Drive,Suite 205, Bellingham,WA 98226,Attn: H/R OFFICE SPACE

Professional,Affordable, Flexible. New executive office suites available on 10th floor of Plaza Center Building on NE 8th Street in Bellevue. Full time office services include telephone, internet, conference rooms, copy room, break room, staffed reception. Personalized telephone answering and administrative support also available. With four locations inWashington, Premier can accommodate almost any budget! www.pbcenters.com Call today for a tour 425-633-3333. Share Kirkland Office Space with two successful CPAs. 140+ sqft private office plus reception area and kitchen. Close to I-405 entrance; walking distance to waterfront, restaurants and shops. Call John (425)827-3031 or Jim (425)822-6022. PRODUCTS AND SERVICES

Affordable Lawyers. Advocates Law Group LLC is a 13 lawyer state wide law firm offering a wide range of legal services at reasonable prices. Our business model, with low overhead, lets us provide experienced lawyers who strive to find practical ways to resolve your client’s legal problems.Visit our website at: http://www.advocateslg.com/ or contact George Tamblyn at 206-236-2769; gtamblyn@ advocateslg.com

38

WashingtonCPA July/August 2012

MERGERS & SALES

Seattle CPA interested in purchasing Seattle tax practice. I am particularly interested in serving the tax planning and preparation needs of high net worth clients in the Seattle Metro area. Have provided these services to such clients over the past few tax seasons. Please contact Gary at gjeweler@ jewelerandassociates.com. Everett/Bellevue Firm Looking for King and Snohomish County CPA firm and/or Registered InvestmentAdvisory Company to purchase. We are the second largest CPA firm in downtown Everett, manage $135m and are looking to purchase another firm. Our client base is as broad as the services we offer, as we cater to individuals and small business. Please contact the owner, Brian Evans at 425-2526909 or email to brian@bauerevans.com. You can review our websites at www.bauerevans.com and www.bondstreetwealth.com. CPA looking for $150,000-$250,000 size practice to purchase in the Bellingham area. Cash purchase. Please respond to Tom by phone, (707) 545-0701 or email,TJTCPA@aol.com. Seattle CPA looking to purchase a practice within the area. Open to discuss all transfer possibilities for a smooth transition. Please respond to info@ ygacpa.com. Considering Selling Your Practice? Consider all your options.We do the work. Confidential.We have buyers actively seeking practices. Call Mark Hause at 877-345-7722 or visit our website at www. accountingpracticesales.com. Accounting Practice Sales.We make dreams happen! Seattle CPA wants to purchase a Seattle tax practice, sized $75,000-$175,000. Please respond to karene@kareneinberger.com.

PRACTICES FOR SALE

IBA Sells Privately Held Companies. Do you represent a client who is ready to retire or has taken a company as far as they want to or can? IBA is the Pacific Northwest’s oldest business brokerage (M&A) firm. We are professional negotiators with over 4000 completed transactions. Please contact us if we can be of assistance at (800) 218-4422 or www.ibainc.com. Miscellaneous

Wanted - Bass and Drummer for Blues - Rock Band. Bass player and drummer wanted for South End Blues-Rock band. Should know the standards (not SSARS - ha ha). Joe@AuburnSoftware.com 253-332-5250. VOLUNTEER POSITIONS

The following organizations need a CPA to serve on the board of directors and/or provide other guidance on financial matters. Learn more at www.wscpa. org (enter “volunteer positions” in the search box). Bellevue Police Foundation - New Communities in Schools of Puyallup Congress for the New Urbanism-Cascadia Coyote Central 20179 Emergency Feeding Program - New Fremont Community Therapy Project - New Headstrong - Support for TBI Youth Helping Link John Wayne Pioneer Wagon & Riders 20205 Metro Parks Tacoma Millionair Club Charity - New NorthEast Seattle Together Northwest Girls Coalition - New Open Arms Perinatal Services Out of the Woods Inc Relief and Education for Afghan Children Seattle-King County Disaster Team

Contact Mark Hause atAccounting Practice Sales by e-mail at MARKHAUSE@CONTACTAPS.COM or call 877-345-7722 for more information on the following practices: Spokane CPA Firm for Sale: This well rounded CPA firm renders professional services in the areas of write-up,income tax, compilation(s), review(s), and auditing. The firm has long term relationships with most of the clients while continuing to accept new business which fuels the continuing growth of the practice. The practice has a variety of clients in all industries but does serve a number of non-profit entities in a variety of capacities. The owner seeks to retire but would be available for transition to the new owner through tax season. This practice is primed for a new owner and continued prosperity.

The Mockingbird Society The Swedish Finn Historical Society Thurston Co Volunteer Legal Services Transitional Resources Vision Loss Connections Washington Autism Alliance & Advocacy Washington Poison Center YMCA of Snohomish County

WSCPA Career Center www.wscpa.org

Job Listings & Career Resources www.wscpa.org


Member profile

Following a Lifelong Passion to Be at the Front of the Pack Tim Jensen, CPA

Tell us a little bit about yourself. Where are you from?

I was born and grew up in Reno, Nevada. I am an only child and I learned to enjoy doing things that I could do by myself. At age 11 I took up cycling and discovered I had a real talent for it. I began racing and held one of the first licenses issued for my age group. I won many races in the 11-14 age groups throughout northern Nevada and California. At 16 I found myself in a tougher class of competition, but kept winning. I was allowed to compete with senior racers through a special exemption. This attracted national attention and I found myself recruited by some big teams, including the Junior National Team. Great experience! I was invited to try out for the 1976 Olympic Team when I was 19 but contracted mono and got sent home from camp with a promise of another shot in 1980. I would be disappointed again in 1979 when President Carter boycotted the games in Moscow over Soviet involvement in Afghanistan. (Isn’t that ironic given current events?) In 1980 I was visiting Yakima with a girlfriend that I broke up with within weeks. All for the best because I met a charming English nurse visiting from Liverpool and she is now my wife of almost 32 years.

What led you to study accounting?

When I was racing in northern California I had the opportunity to attend UC Berkeley for three years, but didn’t graduate because of the demands of my cycling. Probably a poor choice, but I had a dream to pursue. I received my www.wscpa.org

BS in Accounting from Central Washington in 1987 and began my career with a national accounting firm that year. I chose accounting because a counselor who was a CPA assured me I would always have a marketable skill. He impressed me as a person and I appreciated his integrity and honesty. I have never looked back or regretted my choice to become a CPA.

Why did you decide to become a CPA?

Once I made the decision to study accounting I had to follow my lifelong passion to be at the front of the pack. I had observed the success of other CPAs and, for all their differences as people, the common thread of integrity appealed most to me.

If you had not become a CPA, what career path would you have chosen?

What are the highlights of your career, so far?

My career in accounting has spanned 25 years. I spent many of those in local government managing treasury operations, investing money, doing cash management, and debt issuance for a city. I am a Past President and Honorary Lifetime Member of the Washington Finance Officers Association. I have served two State Treasurers on boards of directors of a $12 billion public money fund. I served on the State Auditor’s team rewriting the State’s accounting system. Currently I’m the Chairperson of the WSCPA Financial Statement Review Committee; I’ve helped colleagues and clients with accounting issues. But I feel the highlights are ahead of me and I look forward to every day.

You previously worked for the City of Yakima. What made I would like to have become either an you decide to make the switch economist or a poet. back to public accounting? Tell us about your current position at Villbrandt Stark & Moorer.

I am a partner candidate and hopefully that will happen this year. My work involves mostly financial accounting and consulting with local governments. I am the primary financial statement reviewer for the firm and sign off on all audits and most of the financial statements. I love tax work also and do as much as I can.

What is the most interesting, challenging or rewarding aspect of your job? Why?

My favorite things to do today are to golf, think and learn new information. Staying current with FASB, GASB, IASB and the IRS provide ample opportunity to do all three. (I talk accounting on the golf course.)

I came back to public accounting because I felt as if there was nowhere else to grow in government. That model needs to change. Local governments as they exist are not sustainable into the future.

Do you have a favorite quote?

“Imagination is more important than knowledge”- Albert Einstein

Anything else you want to share?

Never use fear as an excuse to not attempt something that matters.

Tim Jensen, CPA, has been a member of the WSCPA since 2011, and is Chair of the Financial Statement Review Committee. He has been a CPA since 1993. WashingtonCPA July/August 2012

39


Periodicals postage paid at Bellevue WA and additional mailing offices

Your Profession. Your Future. Your Advocate.

Photo Album

2011-2012 WSCPA Annual Award Presentations Brett Jordan, CPA, accepts the New Professional of the Year Award, presented by Mark Hugh, WSCPA Chair, 2011-2012.

Rich Jones,WSCPA President & CEO, congratulates Jim Ladd, CPA, CGMA, recipient of the President’s Award.

2011-2012 Special Award recipient Robbie Dahl-Sullivan, of Becker Professional Education, with Rich Jones.

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The WashingtonCPA July/August 2012