Business entities use insurance to provide protection against various risks ranging from natural disasters to cyber threats. As our economy has evolved the risks that can be insured against have grown more complex. An introduction to business insurance was the topic of our August, 2015 Emerging Business Group seminar. One traditional use of insurance is to provide funds to compensate a business in the event of the death of a founder or other key employee. For founders and other stockholders, the life insurance proceeds received by the entity can be used to fund the purchase of the founder’s ownership interest in that entity. In the case of key employees, life insurance proceeds can help to offset potential revenue losses or increased costs incurred while the entity determines how to deal with the knowledge and resources lost due to their employee’s death. (more…)
CPAs Talk Tech Biz
A recent survey conducted by the Association of Certified Fraud Examiners (ACFE) estimates that fraud losses for a typical organization amount to 5% of total revenues each year with median losses to the tune of $150,000. More than one‐fifth of such losses hit the million dollar mark. The most common type of fraud: asset misappropriation with median losses of $125,000 comprised 83% of all fraud cases reported while financial statement fraud schemes made up just 10% of the total fraud cases, but caused the greatest median loss at nearly $1 million. The frauds reportedly lasted 18 months before being detected. The most telling fact was that private companies logged the highest median loss of $180,000 in comparison to public companies, government, non-profit and other sectors. (more…)
June 30th deadline for filing the Form 114 – Individuals Filing the Report of Foreign Bank and Financial Accounts has passed, but the IRS continues its fight to secure US tax revenue from foreign financial accounts. (more…)
Historically originating through the lens of the independent auditor, whose auditing standards require the auditor to consider “going concern” matters and potentially include cautionary language in the auditor’s report, all companies that issue GAAP-based financial statements are now required to perform their own evaluation and provide explanatory footnote disclosures in defined circumstances. (more…)
The treaty signed between India and Mauritius in 1983, a decade before India opened its door to foreign investors made Mauritius the most favored route to invest in India. Many foreign companies incorporated a holding company in Mauritius which held shares in an Indian company. The sale of shares in Indian company would not result in capital gains tax in India and Mauritius- thereby making it a preferred vehicle for foreign investment.
According to government data, from 2000 – 2015, about $94 billion, a third of all foreign direct investment into India, came via Mauritius. It was a boon to the Indian economy at the brink of liberalization in 1990’s, but gave rise to “round tripping” i.e., Income on which taxes were not paid was routed via Mauritius companies to avoid tax, revenue loss and treaty abuse. (more…)
Continuing along on its accounting and reporting simplification efforts (see April 15, 2015 post), on March 30, 2016, the FASB issued ASU No. 2016-09 (ASU) Improvements to Employee Share-Based Payment Accounting. This ASU changes certain accounting requirements, as well as simplifies some of the underlying assumptions and calculations for the accounting measures. Certain provisions apply to all companies, with additional reliefs available only to nonpublic companies. (more…)
My thoughts about ID Theft have always been, “It’ll never happen to me because I am vigilant.” However also, “it sure seems to happen to a lot of people, so is it only a matter time for me?”
These were essentially conflicting thoughts on ID theft I oscillated between until several weeks ago. I have now acquired the label of “ID Theft Victim.” OK, so that is a slight exaggeration…really it is my spouse, but this change in status affects me, as well. (more…)
Being an auditor for so long has instilled in me the importance of looking at issues, even the non-work related ones and then asking myself, “is this material relevant to the issues that I care about?” And I find that this approach helps me tremendously in deciding where to expend my energies. Along similar lines, not too long ago, FASB issued two proposals on the concept of materiality to help organizations decide the appropriateness of financial statement disclosures. (more…)
If you have made it this far, you noticed our refreshed website. As blog authors, we are excited to be part of this new release.
Yesterday, I was in the process of reviewing a unique equity agreement and determining the accounting treatment for the equity awards. The equity being issued was for a start-up that is “going to change the way we communicate.” From my viewpoint, it seems like all the start-ups I work with have that goal – to change the way something is done. Start-ups are determined to change everything, whether it is the way data is stored in the cloud to the way we purchase goods and services. The mindset that there is a better way to do everything is an exciting environment, and ASL is glad to be a part of the changing technology of our world, even if our part (most of the time) is just to help with compliance and reporting. (more…)