Terry Xiao Blog » Accounting

CPA Exam Reviews And CPA Exam Review

Eric Anderson — Sat, 17 Jul 2010 07:04:52 +0000

CPA Exam Reviews: Getting ready to sit for the CPA Exam means that you need to know the CPA Exam Schedule (and set your test date) and then use a variety of study materials to prepare to pass the exam.

Depending on your learning style, you might select certain of these study tools: * CPA Exam Sample Questions * CPA Exam Forum and Student Discussion Groups * Private Study Groups * CPA Exam sample and CPA Exam Simulations * CPA Exam Review books, including Electronic and printed study texts * Professor Mentoring * Professors’ video lectures and printable slides * Diagnostic Exams * Proficiency Questions * Digital CPA Flash Cards * Performance Metrics * Exam Tutor, and * Final Review. There are a number of providers for CPA Exam Reviews.

CPAexcel recruits top university accounting professors to mentor and author their study materials while other companies simply hire grad students who hit “Play” on a Power Point presentation or a canned video lecture. CPAexcel publishes new textbooks twice a year while another course updates their books only once each year, which means those students are possibly paying for textbooks which are not current enough for the exam. CPAexcel’s books are always current!

How to Handle Written Communications in AUD The American Institute of Certified Public Accountants (AICPA) structures the Uniform Certified Public Accountants Exam (CPA Exam) so that it tests a broad range of your knowledge. One way to do this is to change the manner in which the questions are presented.

In addition to multiple choice questions and simulations, the Auditing and Attestation (AUD) section of the exam has written communications.

Written Communications Many moons ago, this was called the “Essay” section of the CPA Exam. Writing well gets you more points than does content in this section.

What not to use: * Bullet points * Jargon * Abbreviations * Lists. What to use: * Full sentences. * Pretend that you are explaining the general issue to a client or a friend who may not have your accounting expertise. * Talk to the audience, NOT down to the audience. * Clearly define any terms you will use at the beginning of your memo. Explain clearly what “substantive tests” and “attribute sampling” mean and then use them in the memo.

Caution: * Do not worry what you will be asked. Focus on your writing skills because that is what is being tested-not your mastery of the content. Focus your answer on what is relevant to addressing the requirements of the question.

Remember: 10% of your AUD score is based on your ability to write well and stay on topic. Lists are a very small part of the AUD exam so don’t waste time memorizing mnemonics for primary auditing terms because you probably will not use them.

CPA Exam Auditing Simulation The American Institute of Certified Public Accountants (AICPA) structures the Uniform Certified Public Accountants Exam (CPA Exam) so that it tests a broad range of your knowledge. One way to do this is to change the manner in which the questions are presented.

In addition to multiple choice questions and written communications, the Auditing and Attestation (AUD) section of the exam has simulations.

Audit Simulations

By practicing with the sample simulations in CPAexcel, you can become familiar and comfortable with how a simulation works. There is also an AICPA sample exam at www.cpa-exam.org. It is essential that you practice if you wish to pass.

Learning to search and locate the information you need in the table of contents is a skill you need to develop. Read the company profile information and study the financial information given in the problem. Base your answer on the information they give you, not on anything else.

At most of the work tabs in the AUD simulation, there are answer choices. You do not have to think up an answer on your own.

Pick the best one listed.

1. Take your time. Consider the company’s environment.

2. Open each work tab to see what the authors want you to do.

3. Read the content at the information tabs. 4. This should save you some time because now you know what you are seeking in the company information.

5. Click on the “Resources” tab. This may have information which could help you solve the questions at the work tabs.

Now is the time to prepare and pass the CPA Exam.CPAexcel has more study tools than any other cpa review course-and can help you pass the first time. Order CPA Exam today!

CPA Test Schedule And Requirements

Eric Anderson — Wed, 14 Jul 2010 07:29:55 +0000

When Will the CPA Exam Be Given in 2010? CPA Exam 2010: There will be six exam windows in 2010. A testing window consists of the first two months of any quarter: January-February, April-May, July-August and October-November. The CPA Test is offered up to six days each week during each testing window.

Once you are approved to sit for the exam, you should make an appointment with Prometric for a particular regional testing center on a particular day and time. You cannot state that you would like to be there sometime during the week of the 21st. You can schedule your appointment for a specific testing location and “reserve” your seat for that day and time by going online at Prometric’s website or by contacting your local test center.

It is suggested that you schedule early: as much as 45 days before your preferred date to get the date, time, and location you prefer. The 2010 Uniform CPA Examination will be delivered at more than 300 Prometric test centers in the U.S. via a computerized platform. (Not every Prometric center offers the CPA Exam so be sure to check. Never assume anything.)

You can go to www.prometric.com/cpa to gather general information about the test center and/or use the Test Center Locator and Scheduler. Since the website is up 24 hours a day, you can reschedule or cancel appointments at any time. Remember that your exam appointment starts 30 minutes before your test so that you have time to complete registering and the survey. These 30 minutes is not subtracted from your testing time. Completing your paperwork in a rush will not give you extra time on your test.

CPA Exam Requirement: Meeting the CPA Exam Requirements is one step in becoming a CPA. There are 54 U.S. states and territories, each having a State Board of Accountancy which sets the CPA Test Requirements that you must meet if you want to sit for the CPA Exam in that state. In your CPA Exam Application, you would declare how you satisfy the requirements for sitting for the exam. (There may be additional CPA license requirements for additional experience or education once you pass the exam.)

Once you are approved by your state, then you can start your CPA Exam prep and study past CPA Exam questions. CPAexcel gives you over 5,100 past CPA Exam questions in CPA Exam Tutor, an electronic test bank. Create your own tests based on most frequently missed questions, newest questions or a topic. It’s a good idea to set your CPA Test date with a Prometric test center so that you have a goal for completing your studies.

At CPAexcel, the countdown to 2011 has begun. CPAexcel is the only CPA Review that never expires, you can order it now and study for the current 2010 CPA Exam Review. If you have not passed all four sections by the end of 2010, you will have access to the new 2011 CBT-e content and functionality for free!

How To Purchase Easy To Understand Business Software

Steve P Lobston — Sat, 15 May 2010 07:09:04 +0000

Hassle-free small business software is all many companies need. In fact, choosing powerful accounting software may well be a big mistake. There can be more cost to an accounting system than first meets the eye. The initial cost of a system is just the start. The ongoing costs are the ones that may get you. The appropriate accounting programs should save you time, money and stress too. Here are a few simple points to follow.

A Very good Fit.

Many small businesses don’t succeed due to inferior financial controls. With good controls on the money part of your business, you have a more effective chance of success. You ought to buy a system that suits what you do. In nearly all cases there is a ready to use solution already being used by hundreds of companies just like yours. A major software company like Peachtree have simple systems which should be just the answer.

Uncomplicated To Understand.

A big cost of any software is the learning cost. Training and learning have high costs. Getting more software than you need forces you to pay the learning cost even though you do not use the power of the software. Don’t acquire less than you need, but do not procure far more intricacy than required either. And make sure there is good support when things go wrong or you need help.

Uncomplicated To Upgrade.

How will you upgrade if you need additional accounting power? If you get a major brand like Peachtree the upgrade path is obvious. You just choose the upgrade version and the brand-new version is similar to the old. Move from one brand to another and you get to pay that learning cost all over again. You must ensure that there is an upgrade path offered. Otherwise you’ll pay a high price for dead end software if you make a change. You will get to learn a more powerful software that will do the job, although you’ll start your learning from the ground floor.

Simple small business software may be all you need to help you save money, time, and stress. Get software that fits how you do business, but be ready to pay the learning cost. Acquire sufficient system and an upgrade can be relatively painless.Invest in too little and you may be looking at a dead end if you need a lot more accounting power. Than you will get to pay the learning cost all over again. Often the best solution is a simple version of one of the major selling software brands. That is why you should look at an industry leader Peachtree. You get a low initial cost plus a clear support structure and experts that can help you right in your area

If you are interested in finding out more about Peachtree Accounting then go to this useful site http://peachtreeaccounting.org

How To Learn More About The Accountant Career

Susan Bean — Mon, 10 May 2010 08:45:26 +0000

There are many different working environments and responsibilities within the accountant career. However, it is their main objective focuses on maintaining and assisting clientele financial recorded, preparation of tax forms and making sure they’re submitted to the proper agencies, assisting with financial advice, and making sure that their client gets the best tax deal possible.

Accountants generally spread out over many different fields, with a small portion being within government agencies or facilities, and the rest within the private sector. Some may also choose to work for themselves, whether in the comfort of their own home or office, often being responsible for their own clientele and overall business.

Those who work from their home may often see a different mix of things, depending on their clientele base. For instance, an accountant may assist with regular tax matters with the majority of their clients, while offering regular payroll services to others on a weekly, bi-weekly or monthly basis as well. Some may also offer services in investment planning, budget analysis, assistance with accounting legal help, and other forms of financial advice.

The type of working environment that an accountant may work in can often vary, whether it’s working within their own home, visiting the home or office of a client, or working within an office. Hours are often 40 hours a week; however, they can exceed this during tax season, depending on the volume of work involved.

Often enough, companies expect accountants to have some form of bachelor’s degree that revolves around accounting, although some may also have a bachelor’s degree in similar fields or that of business. However, in some cases, certain companies may actually require candidates to have a master’s degree in business administration, with much of their focus being on accounting.

Those who graduate from junior colleges or business vocation schools can often find a position as a junior accountant, as well as those who work with bookkeeping or accounting clerks, providing meet the necessary experience requirements. There are, however, many different programs and course paths offered by colleges, universities, junior colleges and so forth.

Accountants may also wish to gain further education in order to become a certified public accountant, or CPA, which is required when filing with the Securities and Exchange Commission (SEC). Most states require that those wishing to become a CPA will need a college degree, although this is not with all states. However, there are also many different other types of certification that an accountant can also obtain.

It has been projected that the accountant career will see a rise in demand within the future, although competition among accountants will also likely rise as well. Salaries will often vary on several factors such as the level of education or certification that one might have, location and the demand within that particular area, as well as overall experience. However, earning potential usually averages between $45,000 to $78,000 per year, though some may seem more depending on the nature of their work.

The average salary accountant is fairly high. Find out exactly what you can earn from http://www.accountantsalarydata.com

Proposed Changes to the New Zealand Tax System

P J Easton — Fri, 01 Jan 2010 09:27:46 +0000

As one year ends and the next begins, interest regarding the future of the tax system is natural. In regards to property laws, many of the changes being considered by the Tax Working Group could prove detrimental to those who invest in real estate.

For some time the government has been proposing various modifications that will result in higher taxes being paid by property investors. It is unlikely that any of the proposals will result in immediate change but it is a good idea to become aware of what’s on the table.

As it gets closer to the time when a definite determination will be made – most likely soon after the beginning of the year – it is appropriate to consider how these changes may affect investors.

It is expected that the following revisions will be considered for inclusion in the new tax system:

* While individual tax rates will decrease, the rate of GST will increase in order to make up for the deficit. Corporate and trustee rates will become more closely aligned.

* The tax rates are expected to change drastically but tax laws will most likely remain unchanged in regards to assessments of capital gains and equity. The government’s stance is that it is disinterested in instituting sweeping changes at this time that could negatively impact a strengthening economy.

* There should be no surprises in the federal budget, either. Should any new tax rules be implemented, such as a risk-free rate of return investment property tax which has been bandied about, the legislative process is such that it will take some time before they are enacted.

* Throughout the year of 2010, additional options in the tax rules are likely to be debated and subject to public review. The Tax Working Group will probably propose several options rather than strongly back only one. This will allow the government to select the most favourable to stand behind and bring to public review.

* Tax changes regarding property investments will most likely be considered at some time in the upcoming year during the budgeting process. It would not come as a surprise if the deduction for building appreciation is denied. Whether or not it would apply retroactively is in question.

The tax program currently under review in Australia will probably influence the decisions for future tax structures in New Zealand. Depending on the results of the Henry review, our tax laws may or may not change as expected.

Paul Easton works in marketing for Mathew Gilligan – an accountant and partner at Gilligan Rowe & Associates Ltd (GRA). GRA is a Chartered accountant firm specialising in property in New Zealand. Search Engine Optimisation by Digitalawol.com

What Happens to Assets Without a Trust During Divorce?

By Paul Easton — Fri, 01 Jan 2010 09:26:58 +0000

For the married couple, it is truly essential that an estate is properly structured, legally protected, and the disposition of assets in the case of separation clearly defined. If you have not yet started a trust for your assets as a property investor, perhaps this scenario will convince you of the need to do so.

The Case of the Trust-Less Divorce

In most cases, divorce is a messy matter. It is highly unlikely that the two parties will be able to reach an amicable agreement as to the disposition of assets. Even with a trust, in the absence of a Property Relationship Agreement a legal battle may ensue because there is still the issue of what to do with the assets in the trust.

Of course, the first step will be hiring a lawyer for each side. As we all know, legal fees can quickly add up to thousands of dollars. Consider the property investors who have a $500,000 house listed as an asset. Is a combined $100,000 in legal fees worth the argument? It may not make much sense, but this is what many couples end up doing – paying money to fight over a property that is still mortgaged.

Then again, during a divorce few people are going to act rationally. More often than not they are hurt, and those hurt feelings cause them to fight. Because legal issues can take months or even years to resolve, this must makes the pain last longer. The lucky couple engages a trustee who can help calm them both down and move them toward some agreement. The unlucky couple has no one to advise them thusly, or chooses to ignore attempts at resolution.

If an agreement cannot be reached, the next step is to go to court. It will be up to the court to decide the disposition of assets.

The Importance of a Property Relationship Agreement

If there is a trust in place without a Property Relationship Agreement, then the court must also review the terms of the trust, including how it was set up, how it has been run since its inception, who is in control of it, what assets have been transferred to it, and the amount of outstanding financing that is secured by the trust’s assets. Obviously, this could take some time.

Following the review, the court will set out its orders. Another individual could be put in charge of the trust, as trustee. The court will have to decide how much money is awarded to each ex-spouse. No matter what happens, someone is likely to be unhappy about the outcome.

The best way to avoid this scenario is for the property investor to create a trust where the assets are placed immediately. Following that, the creation of a Property Relationship Agreement which designates disposition of the assets is essential. A married couple may even want to consider creating two trusts, one for each spouse.

The time to protect your property is now.

Why Property is Always a Good Investment

By Paul Easton — Thu, 31 Dec 2009 10:03:49 +0000

When it comes to investments, there are few that are always as reliable and easy to finance as real estate. Commercial and rental properties allow the investor to actually make money on the deal even while it is being financed. Certainly the real estate market has its up and downs, but the investment will always appreciate, unlike shares in the stock market.

Getting Started

The first place to start is by finding a property. The key to making a profit is to find a high-value property that is offered at a discounted price, and one that is already rented or has good potential to be fully leased – creating a positive cash flow situation.

The next consideration is financing. The home owner who has equity in their house can take out a line of credit against the value of the property. This line of credit, or second mortgage, is used to fund the deposit on the new real estate purchase. With an 80% loan, this gives the investor an idea of the price range they should be searching in.

Example Investment

Here is an example of property deal that would make a good investment.

The property is valued at $375,000 and purchased for $300,000. It brings in rental income of $475 weekly.

To purchase this property, you would need to have $60,000 as the deposit with the remaining 80%, or $240,000, financed by the bank. Using your line of credit as the deposit, this means the property is 100% financed by two different loans with no cash outlay.

After six months of ownership, it is possible to refinance. The property is still valued at $375,000 and with the 80% financing rule of thumb, this means a new loan can be written for $300,000 and the $60,000 initial deposit returned to pay the line of credit loan.

This example illustrates the importance of finding real estate that can be purchased for 20% below value.

Consider, also, that you are receiving rental income the entire time. With a rent amount of $475 weekly, this translates to $24,700 per year, giving the investor an 8.23% return. When the loan is financed at a less than 8% interest rate, this results in a positive cash flow. Purchasing the property through an LAQC allows the investor to take a deprecation allowance on taxes and receive a refund.

All in all, this is a win-win situation. There is no cash outlay, rent pays for the expense of the loan and associated maintenance costs and fees, and ownership allows for a refund cheque from the IRD. The longer you hold on to the property, the more likely it is to rise in value, providing an even larger return on investment over time. Obviously property investment is quite worthwhile.

YB 11, Associated Persons, and the Trust to Appointor Test

By Paul Easton — Sun, 27 Dec 2009 08:06:01 +0000

Recent changes made by the Finance and Expenditure Select Committee affect many property investors in regards to trusts set up for the placement of assets. The definition of associated persons was just one new area that complicated things for the investor; the Trust to Appointor test cited in section YB 11 is another area that perhaps needs further explanation.

Associated Persons Rules

The association rules apply to the relationship between land dealers, real estate developers or builders, and other business entities involved in buying and holding property. The rules were put in place because of a concern that associated businesses would work together to buy a property for the express purpose of holding it and avoid the capital gains tax.

An unexpected by-product of these rules is that professional advisors who are designated as appointors to an otherwise unrelated trust are considered an associated party. The appointors’ assets, as well as those of his or her other clients, are also considered tainted under these rules.

Taxation Remedial Bill: Section YB 11

What YB 11 states is that a trust is associated with its appointors. The association exists because of the tripartite test whereby an association exists between two parties where both share a common associate, such as a professional appointor.

However, upon examining this test more closely, the common entity is not subject to the test twice. For instance, if a professional appointor for Trust A also holds the Power of Appointor ship for Trust B, there is not an association between these trusts. This tripartite provision states that the common associate (the professional appointor) is associated to both trusts by means of the same test – and applying the same rule twice is not allowed by YB 14.

The associated persons rule does not necessarily work as it should, however. It is possible under the current test for an appointor of a trust used for property investment to also be a shareholder in a development company or a settlor of another trust involved in property development. With the rules as they stand, this would allow the association.

Of course, most appointors would be negligent if they accepted an appointor ship to two such trusts or held stock in a related company. Should this situation come to light, the client’s assets could be subject to a 30% capital gains tax when sold within a decade, as well as any assets acquired over the period of association.

Even if there is not outright negligence proven, other situations, such as when a client begins the business of real estate development at some time during an association with the appointor without telling him or her, could also result in the same consequences.

Until the new rules are further sorted out, it is advisable to be very careful when appointing a professional to manage a property investment trust.

What are independent auditors?

terry — Thu, 01 Oct 2009 07:41:27 +0000

Indpendent CPA auditors are like referees in the financial reporting arena. The CPA comes in, does an audit of the business’s accounting system and methods and gives a report that is attached to the company’s financial statements. Publicly owned businesses are required to have their annual financial reports audited by independent CPA firms and any privately owned businesses have audits done as well because they know that an audit report will add credibility to their financial reports.

An auditor judges whether the business’s accounting methods are in accordance with generally accepted accounting principles (GAAP). Generally everything is in place and the financial report is a reliable document. But at times an auditor will wave a yellow or red flag. Some indicators of potential trouble include when the business’s capability to continue normal operations is in doubt because of what are known as financial exigencies, which could mean a low cash balance, unpaid overdue liabilities, or major lawsuits that the business doesn’t have the cash to cover.

An auditor must exercise professional skepticism, meaning the auditor should challenge the accounting methods and reporting practices of the client in order to make sure that its financial statement conform with accounting standards and are not misleading – in short, that the financial statement are fairly presented. Indeed, the words “fairly presented” are the exact words used in the auditor’s report.

A good auditor need technical know-how, but also needs to know how to be tough on the accounting methods of the client. His job is to be the agent of the shareholders and other users of the business’s financial report. It’s incumbent on an auditor to strictly uphold GAAP, and not let any irregularities slide.

There are a number of well-known companies that engaged in accounting fraud recently and that fraud was not discovered by the CPA auditors. Enron is one of these companies. In this case, the auditing firm, Arthur Anderson was found guilty of obstruction of justice because it destroyed audit evidence.

Terry Xiao Blog » Accounting

CPA Exam Reviews And CPA Exam Review

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CPA Test Schedule And Requirements

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What Happens to Assets Without a Trust During Divorce?

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Why Property is Always a Good Investment

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YB 11, Associated Persons, and the Trust to Appointor Test

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