Accounting Updates are articles, tips or announcements regarding accounting and tax-related subjects that may affect or benefit your business or industry.
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers. This standard eliminates the transaction- and industry-specific revenue recognition guidance under the current GAAP and replaces it with a principle-based approach for determining revenue recognition. The FASB has subsequently issued multiple ASUs that modify or add to the original standard.
The increase in available software options has led software companies to look for ways to differentiate themselves from their competition. An increasingly popular way to do this is to obtain a System and Organization Controls (SOC) report which addresses the internal control environment of the software companies to help ensure the application’s stability and security.
There are common management issues in employee benefit plans. Having the appropriate Complementary User Entity Control in place will assure to plan management that policies and procedures are being followed.
Before you can perform functional expense reporting, you should have a written policy in place addressing cost allocation. The policy should be reviewed at least annually and revisions made as necessary.
SOC 1 reports will look nearly identical under SSAE 18 as they did under SSAE 16, and changes to the reports will be minor, so there is not much that service organizations will have to change, especially Holtzman Partners clients. However, the shift to SSAE 18 does result in 5 main changes.
The new accounting guidance on nonprofit financial reporting applies to fiscal years beginning after Dec. 15, 2017 (calendar 2018 for calendar-year organizations); however, early adoption is permitted. So now is a good time to think through the impact the new accounting standards will have on your financial statements.
In most cases, participants’ immediate and heavy financial need must be established based on “all relevant facts and circumstances” before they are eligible to request a hardship distribution. Yet, the IRS has established safe harbor rules that automatically consider an employee to have such a need if the distribution is used to cover a few specific expenses.
Read more to learn when these ASUs take effect and how they may impact your business.
As we approach the end of 2016, companies should consider exploring opportunities to help minimize their 2016 tax bills and plan ahead for 2017. Our summary touches on topics that should have the most impact on the business community.