NewsAccount Colorado Society of CPAs
? November/December 2012
thorough
and
uniform The Colorado Education System: K-12
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NewsAccount
Contents Features
} 4 The Ride of a Lifetime
Greg Anton, CPA, looks back on his year of travel and learning while representing the AICPA as chair.
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For
CPAs in Business and Industry, Healthcare Reform Opportunities The Affordable Care Act increases the demand for specialized skills and new business processes.
10 2013 Tax Planning Reminders
How does the CPA proceed with client tax planning for an uncertain future?
12 The Colorado Education System: K-12 If you ask where improvement is needed in Colorado's education system, the first word you'll here is money.
18 How to Fire a Client
Breaking up can be hard to do especially with a client. The experts tell you the best way to do it.
The COCPA Office will be closed, Nov. 22 - 23, Dec. 24, 25, 31, and Jan. 1 in observance of the holidays. Please visit www.cocpa.org for 24/7 online assistance.
Departments
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8 Point/CounterPoint 20 State of the Industry 21 Movers & Shakers 24 Classifieds Nov/Dec 2012
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NewsAccount A bi-monthly publication of the Colorado Society of Certified Public Accountants Vol. 58, No. 4 November | December 2012 Board of Directors Scott E. Bush, Chair Marc C. Hendrikson, Vice Chair Lora L. Finley, Treasurer Michael S. Bearup, Immediate Past Chair Mary E. Medley, Secretary Directors Carrie J. Bartow, Steven R. Corder, Peter J. Derschang, Ben T. Hrouda, Christine Riordan, Debbi C. Warden Editorial Board Jack Allgood, James M. Boak, Frances J. Coet, Kay R. Dragon, Deanna C. Duell, Jennifer Emerson, Mira J. Finé, Georgia Z. Phillips, Patrick A. Lytle, Mark Paller, Jennifer C. Pitkin, Tawyna Ramirez, Ronald O. Reed, Scott K. Sprinkle, Barbara J. Tedesko, Mark A. Torrey, Gregory A. Truitt, R. Stephen Van Meter, Michael West Mary E. Medley, President/CEO Elizabeth M. Julin, Deputy Director Krista Flynt, Editor/Publisher Natalie G. Rooney, Contributing Writer NewsAccount (ISSN #10899952) is published bimonthly by the Colorado Society of Certified Public Accountants, 7887 E. Belleview Ave, Suite 200, Englewood, CO 80111. NewsAccount is published in January, March, May, July, September, and November and reports information, news, and trends in the accounting profession. The Colorado Society of CPAs assumes no liability for readers’ business decisions in reference to advertisements or other information included in this publication. Membership dues include a $9.90 one-year subscription to NewsAccount. Periodical postage paid in Englewood, CO, and additional mailing offices. POSTMASTER: Send address changes to NewsAccount, Colorado Society of Certified Public Accountants, 7887 E. Belleview Ave, Suite 200, Englewood, CO 80111. Net press run = 8,550 copies; sales through dealers and carriers, street vendors, and counter sales = 0; paid or requested mail subscription = 8,450; free distribution by mail = 50; free distribution outside the mail = 0; total free distribution = 50; total distribution = 8,500; office use, leftovers, spoiled = 350; returns from news agents = 0; total sum = 8,850; percent paid and/or requested circulation = 99%.
303-773-2877 • 800-523-9082 Fax: 303-773-6344 • cpa-staff@cocpa.org NewsAccount is available in PDF format online at www.cocpa.org.
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NewsAccount Nov/Dec 2012
Chair Column
We're Halfway There by Scott E. Bush, CPA
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’m at the halfway point of my year as COCPA chair, but I feel like things are just taking off. At this moment, your COCPA leadership is taking on some big challenges to make sure we’re meeting members’ needs on every level.
CDOR Update You may say, “What? CDOR information again?” but working with the Colorado Department of Revenue (CDOR) remains one of our most important projects because we know it’s a critical issue for many of you. How would I describe the current state of affairs? Fluid. In August, we surveyed members electronically about their experience with the CDOR this year compared to last year, as reported in the September/October NewsAccount. We reviewed the survey results with CDOR senior management and the COCPA/CDOR Joint Task Force in September. Since then, we continue to work closely with the Department to address the issues raised. It’s important for us all to understand that our frustrations and issues with the CDOR aren’t going to go away overnight. Instead, it will be a process requiring a lot of back and forth between the two organizations. The good news is that Executive Director Barb Brohl and her team are open to feedback, are willing to work face-to-face with us to address our issues, and we are making progress. We continue to meet and openly discuss how systemic issues can be overcome and to identify problems and correct them versus merely accepting the status quo. We’re working together with a think-outside-the-box mentality that applies not only to the CDOR but also to CPAs. We’re asking the CDOR to do things differently, but what can we as CPAs learn as well? This is an educational process that will ultimately benefit all of us.
On the Horizon Serving as your chair has been, and continues to be, a blast! I hadn’t anticipated how much fun it would be to hit the road and meet with you all throughout the state during the chair tour visits. It's been busy, too. The website launch and the COCPA’s move into a new office were big summer projects. Now, we’re ramping up and preparing for some new initiatives. October brought another AICPA Council meeting, and November always means it’s time for the CPAs Make a Difference Celebration (Nov. 8, Westin Denver Downtown). Other irons in the fire include changes to CPE programming. Past Chair Sidny Zink is CPE Board chair this year. She’s working on continuing strategies for member education with the Board and staff. Also, the COCPA is continuing to implement a new database system, a huge undertaking. And, we’ve been heavily involved in rulemaking with the Colorado State Board of Accountancy. The 2020 Committee has just read Race for Relevance: 5 Radical Changes for Associations by Harrison Coerver and Mary Byers, CAE. This book has been instrumental in helping the committee set priorities, determine what members want, and how to best serve you. Our goals include ensuring that every program or activity provides value, determining how we can be most effective, and implementing strategies to continue to improve. The groundwork we’re laying today will be the foundation for the future of the COCPA. While it has been a busy year so far and technically I’m halfway finished as chair, our work is never really complete, is it? We’re digging in and moving forward on many projects that will benefit every CPA in Colorado. Stay tuned for developments on every front. s Email Bush at scott@soukupbush.com.
State Board Breaking News
2012 Rule-making: A Work In Progress
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n Oct. 17, 2012, the Colorado State Board of Accountancy held a day-long rule-making hearing to consider amendments to the rules it adopted, effective October 30, 2010. These current rules were adopted to implement House Bill 10-1236, the Board continuation bill, and incorporated requirements for the 150-hour education requirement as of July 1, 2015, and mandatory peer review for CPAs and CPA firms performing attest services, effective with registration renewals beginning in 2014. That year, every chapter was amended except for Chapter 9, the Rules of Professional Conduct. This time, changes were proposed for all twelve chapters – some substantive and some minor. Substantive changes were proposed for Chapter 2, Education Requirements for Examination and Certification, and the rules governing the 150-hour requirement. If adopted as proposed, the rules would require a student desiring to sit for the Uniform CPA Examination on or after July 1, 2015 to have a baccalaureate degree, 27 semester hours of accounting courses – with 21 of those semester hours in “Upper-Division” coursework – and 21 semester hours of business courses – with 15 of those semester hours in “Upper-Division” coursework. For licensure, the student would be required to have a baccalaureate degree plus 30 semester hours of coursework including 33 semester hours of accounting courses – 27 of those in “UpperDivision” coursework – and 27 semester hours of business courses – with 21 semester hours in “Upper-Division” coursework. In addition, the proposed rules defined Upper-Division as: Coursework acceptable for transfer at the junior or above level by a baccalaureate, masters, or doctorate-granting institution. On and after July 1, 2015, Upper-Division means coursework delivered by a baccalaureate, masters, or doctorate-granting institution that is acceptable for transfer at the junior or above level by another baccalaureate, masters, or doctorate-granting institution. This change would eliminate the current ability for those who already have a bacca-
laureate in a major other than accounting to count coursework taken at two-year educational institutions. Also, a provision enabling the State Board to approve “an accounting certificate program at a community college” was included. These proposals generated written comments as well as testimony at the public hearing. In the end, the State Board tabled adoption of the proposed changes to Chapter 2 to allow for further consideration of the issues raised by the public. The Board also tabled adoption of Chapter 1, Board Organization and Administration, because it includes the definitions of terms which may need to be changed as a result of reconsidering Chapter 2. And, the Board tabled adoption of Chapter 9, the Rules of Professional Conduct, to allow for further consideration as well. The remaining proposed rules for chapters 3, 4, 5, 6, 7, 8, 10, 11, and 12 were adopted with amendments.
What Happens Next The State Board will revisit the proposed rules for chapters 1, 2, and 9 at its next regular meeting, Dec. 5, 2012, beginning at 8:00 a.m., and will determine whether and how to revise them for public notice, comment, and future adoption. The rules adopted on Oct. 17, 2012, will not go into effect until the proposed rules for all chapters are adopted, likely in spring 2013. For the meeting agenda, which typically is posted online 10 days prior to the meeting date, go to www.dora.state. co.us/accountants/board/notices.htm.
New Rules Coming Chapter 3 – Examination General Requirements and Prohibited Conduct: Expands rules on what constitutes “candidate conduct during examination” include what is considered a violation of test administration for those taking the Uniform CPA Examination. Chapter 5 – Requirements for Certification: Requires that the applicant for li-
censure pass the AICPA Ethics Examination with a score of 90% or better. Chapter 6 – Certificate Maintenance and Status Changes: Adds a requirement for all CPAs who are sole proprietors to provide the Board with the DBA or the trade name they would be using. Increases CPE requirements for Inactive Status Certificate Holders wishing to return to Active Status, to include not only 80 hours of CPE prior to applying for the status change but also any CPE the applicant should have taken at the time the Inactive status application was approved. Chapter 7 – Continuing Professional Education (CPE): Adds course content requirements for a Colorado Rules and Regulations (CR&R) course to be accepted for CPE credit by the State Board and requires that CR&R course materials and/or the certificate of completion include the date on which the course was taught or the materials were last updated. Also outlines what is required to claim credit for a specialized industry program which does not meet the CPE standards as outlined in the AICPA/NASBA Joint CPE Standards. Chapter 8 – Peer Review Requirements: Specifies the time frame within which a Certificate Holder or Firm must register for and undergo Peer Review and adds detail on document retention and procedures. Chapter 11 – Practice Privilege/Mobility: Defines “principal place of business” as “the location designated by the Individual, but the presumption may be overcome if the Individual resides in this state and provides Professional Services to clients located in this state.” Chapter 12 – Firm Requirements: Consolidates in a new chapter all the firm-related rules and requires that a Certificate Holder, including a single owner, register any form of partnership, professional corporation, or limited liability company before holding out or engaging, through that entity, in activity for which an active CPA certificate is required. s For more information, contact Mary E. Medley at mmedley@cocpa.org, 303-7418601, or 800-523-9082, ext. 101. Nov/Dec 2012
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The Ride of a Lifetime For the last year, Gregory J. Anton, CPA, has served as chair of the American Institute of CPAs Board of Directors. As he wraps up his term, he reflects on the experience with contributing writer Natalie Rooney.
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ust 12 short months ago I stepped into the role of AICPA chairman. Now, I find myself looking back on an incredible year, marveling at how fast it went, and how much I learned. Leading the AICPA membership was what I expected it would be in terms of the time commitment — but the opportunities I experienced exceeded anything I ever imagined they could, or would, be. Many of my experiences centered around the celebration of the AICPA’s 125th anniversary, but that was only the tip of the iceberg.
Taking our Message to Capitol Hill While I had been to Washington, D.C. before and even to the White House on the typical tourist tour, the 2012 AICPA Spring Council meeting brought a unique and exciting opportunity. Our AICPA contingent personally delivered information directly to members of President Obama’s cabinet at an AICPA Board meeting in the White House’s Roosevelt Room, located in the historic West Wing. What an experience! We discussed two initiatives which I am most proud to be a part of over the past year: What’s at Stake? A CPA’s Insights into the Federal Government’s Finances (www.aicpa. org/Advocacy/Pages/CPAsInsight.aspx) offers guidance for policy makers and the public on how the U.S. government’s financial statements can be used for greater understanding of the nation’s fiscal health.
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The groundwork for this video was laid when I chaired a committee that evaluated the Federal Accounting Standards Advisory Board which sets accounting standards for our federal government. While talking to legislators at the state and federal level, it became apparent that most of them had never read the government’s financial statements and that we needed to educate not just the public, but policymakers, too. From those humble beginnings, the video emerged, and CPAs were the ones to create a national dialogue around our country’s financial sustainability. We also introduced policy makers to the AICPA’s Total Tax Insights Calculator (www. aicpa.org/ForThePublic/Pages/TotalTaxInsights.aspx), developed as a public service to give taxpayers a clearer picture of the types and number of taxes they pay throughout the year and the estimated amounts of each. While these tools allowed us to take a specific and important message to our nation’s leaders, they are valuable to each of us in our everyday lives, as CPAs and as citizens
of the United States. If you haven’t had a chance to watch What’s at Stake or give the Total Tax Insights Calculator a test drive, I encourage you to do so –– and pass the links on to your colleagues, clients, and the general public.
International Perspective Another highlight of the year was flying to London in January for the launch of the Chartered Global Management Accountant (CGMA) designation. With the launch occurring in different parts of the world, it brought home the international element of our profession and how working with accountants around the world makes our profession stronger. I went on to Northern Ireland for the Chartered Institute of Management Accountants' (CIMA) annual meeting where I had the honor of meeting and having dinner with Ireland’s president, Michael Higgins. With us at our table was Mary Peters, a gold medalist at the 1972 Munich Olympics.
It was fascinating to hear her stories of the past. The evening was representative of my entire experience as AICPA chairman — incredible discussions, experiences, and learning opportunities between CPAs and nonCPAs from around the world. We are truly an international profession.
Supporting Private Companies Another AICPA initiative which saw much progress over the last year was the work on private company standards. The AICPA supports the Financial Accounting Foundation’s (FAF) creation of the Private Company Council (PCC), which will modify U.S. GAAP for privately held companies. The FAF is FASB’s parent organization. While not an easy process, it’s a great example of the AICPA, state CPA societies, and our collective members joining in an effort that creates major change to America’s financial reporting system, something that is truly beneficial and important to smaller businesses and users of their financial statements. The AICPA will continue to advocate for appropriate changes in GAAP to reflect the private company environment and eagerly awaits the appropriate, substantive differences the Council is charged with producing.
The Enrichment Cycle All of these experiences — the places I’ve been, the people I’ve met, the things I’ve learned — would not have been possible
“
I always thought I should give back to the profession, and I discovered, as many have, that it’s a cycle of enrichment: you get involved, and you ultimately get back more in return. — Greg Anton, CPA
without the support of my family and my firm. I’ve always advocated for work/life integration, and even over the course of this very busy last year, I’ve had the opportunity to ski with CPAs in other part of the country, mountain bike with CPAs from the West to the Northeast, and my wife, Julie, and my son, Jake, were able to join me on several trips over the summer. So many individuals at Anton Collins Mitchell LLP stepped up, contributed, and participated which allowed me to give back to the profession. The entire firm was behind my efforts this year. I trust members of my firm found that they grew personally and professionally as well. Over the last 12 months, as I visited many states and met with many CPAs, I knew I was there to represent and teach, but I was actually learning and receiving more in return from CPAs in government, education,
industry, and public accounting. I appreciated hearing their perspectives. It brought me back to our COCPA CPAs Make a Difference event last year where I spoke about the reasons I’d always been involved in the profession with both the COCPA and the AICPA. I always thought I should give back to the profession, and I discovered, as many have, that it’s a cycle of enrichment: you get involved, and you ultimately get back more in return. This past year has absolutely crystallized my belief in this cycle, and it has played out for me again and again as AICPA chair – the more you give, the more you get back in return from friendships and in knowledge. Sometimes I shake my head in disbelief at the incredible things I’ve done and the people I’ve met as AICPA chairman. But nothing stands out more than the time I spent with CPAs — especially our young professionals — sharing stories, hearing what’s working for them, and where they feel things could improve. It’s a reminder that nothing is accomplished in a vacuum. As an individual CPA, if you have ideas you think can benefit the profession, voice them. Get involved. You can make a difference and enrich the profession. It’s about employing your passion and moving the needle. Even the smallest impact will benefit many. The AICPA has had a great history over the last 125 years. It will take members actively participating to create success for the next century.s
ACM takes the trophy audit bag at the 2012 COCPA Corporate Kickball Cup Aug. 25, 2012 Timmons Heil and Alicia Sweeney were named MVP's. Anton Collins Mitchell LLP broke CliftonLarsonAllen LLP's two-year winning streak and celebrated the victory as you would expect. Watch NewsAccount for details on the 2013 tournament.
Nov/Dec 2012
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Health Care Act Creates Opportunities for CPAs in Business and Industry
Expanded Role and Heightened Profile The far-reaching scope of the PPACA extends beyond health care providers and insurers to include organizations representing virtually every industry, size, and geographic area. PPACA’s broad application presents vast opportunities for CPA, CGMAs to further improve operational efficiency and performance, and showcase the full extent of their capabilities, value, and contributions. “Employee morale, productivity, recruitment, and retention are only a few of the issues that are heavily impacted by an organization’s ability to successfully implement
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GR WTH It’s what CGMA stands for. Officially, of course, it’s Chartered Global Management Accountant. A new designation representing accomplished professionals that drive and deliver business success, worldwide. Find out more at cgma.org
the new health care reform legislation,” says Paul L. Shillam, controller, Pacific Medical Centers. “CPAs, CGMAs’ combined financialCGMA_ThirdPage_ADS_cobrand.indd and non-financial expertise,1and insights into workplace dynamics, are guiding organizations to legislative compliance, a well-informed management team, and an engaged workforce.” Although the degree of the PPACA’s impact depends largely on the size of the employer, there are a number of key responsibilities that are uniquely suited to the expertise of CPA, CGMAs and are in strong demand by managers at organizations across the country. These responsibilities include the following.
Identify and Respond to Additional Costs PPACA implementation has a number of penalty provisions that need to be identified and addressed. Management will need help fully understanding the complete range of
Copyright © 2012 American Institute of CPAs. All rights reserved.
When President Obama signed the Patient Protection and Affordable Care Act (PPACA), he ushered in one of the most dramatic and controversial health care reform initiatives since the passage of Medicare more than 45 years ago. In pursuit of the goal to address rising health care costs and provider access, the PPACA has raised the demand for specialized professional skills and knowledge as well as new internal business processes. Organizations need expert insights for understanding legislative provisions and explaining them to employees as well as policies and procedures for ensuring compliance with current and future requirements. CPAs performing management accounting duties on behalf of business and industry have an opportunity to take on a leadership role within their organizations, guiding management as it navigates through the intricacies of PPACA legislation, and helping maintain smooth, continuous, and successful operations. Recognized by the new Chartered Global Management Accountant (CGMA) designation, created by the AICPA and the Chartered Institute of Management Accountants (CIMA), CPAs in business and industry, can distinguish themselves as PPACA authorities through their extensive education, training, and experience in finance, management, and regulatory affairs.
possible penalties, explain the consequences of penalty-related decisions, and create strategies for avoiding and mitigating penalties whenever and wherever possible.1/26/12 4:01 PM Included among PPACA provisions is the $2,000 per-person penalty that applies to large employers that fail to offer health care coverage to employees. Employers may make this decision for financial reasons — it may be less costly to pay the penalty than offer health care benefits, which, according to the Kaiser Family Foundation, average $4,508 for employee-only coverage and $10,044 for employee and family coverage. Other penalties include $3,000 that is incurred when an employee enrolls in a qualified health plan that allows a premium tax credit or costsharing reduction to the employee.
Evaluate the Full Impact of Coverage Decisions Ramifications may include increases in employee compensation to offset the expense
employees will incur for private insurance as well as additional payroll taxes. Other consequences can include employee recruitment challenges, declines in employee retention and overall satisfaction, and damage to the organization’s brand and reputation.
Assist with Process and Procedural Changes The PPACA includes a number of provisions that result in changes to existing systems and procedures that can be more successfully accomplished with CPA, CGMA guidance. For example, Section 9002 of PPACA expands reporting requirements for employer-sponsored health care benefits on employees’ IRS Form W-2 at year-end. Human resource and payroll systems will need to be updated to capture the cost of employer-sponsored insurance benefits effective for calendar year 2011, and extended to 2012 by the IRS.
Contribute to Staff, Pay, and Benefits Decisions As implementation of PPACA moves forward, organizations need professional expertise in fully understanding the legislation’s impact on hiring decisions and compensation and benefits packages. Among the human resource responsibilities that are undergoing drastic changes, and require close CPA, CGMA involvement, are evaluating employer-sponsored insurance benefits; attracting employees; weighing the advantages and disadvantages of full-time, part-time, temporary, and per-diem team members; and addressing potential changes to compensation structures.
Answer Tax Questions The PPACA contains numerous tax provisions that will impact individuals and businesses of all sizes. One impact that higher-income taxpayers are likely to notice is the 3.8 percent increased tax on investment income, which translates to an overall 18.8 percent tax on capital gains for 2013, versus 15 percent in 2012. AICPA Tax Manager Kristin Esposito suggests taxpayers consult with their CPA to determine whether they should sell assets or take other steps to minimize their liability. “If income rates revert to pre-2001 levels in 2013,” Esposito cautioned, “there will be an even higher tax on any portion of investment income, e.g., interest and annuity payouts, that is taxed at individual income rates.”
Do you desire a work life balance? Strive to help others succeed? Want a great career opportunity? Enjoy working with challenging clients? Do you like to have fun?! Then consider the opportunities available at EKS&H. With approximately 440 professionals, EKS&H, consecutively named one of the best places to work in Denver and America, is Colorado’s largest locally owned public accounting and business consulting firm. Our commitment to serving others and building trust has resulted in exceptional and continued growth. As a result, we are looking for talented and enthusiastic individuals to join our team. For more information, visit our website or e-mail your resume to lnelson@eksh.com.
Keep Leadership Updated on Changes PPACA must be viewed as a process rather than an event. Upcoming laws may address issues ranging from clarifying the PPACA’s intent to being more specific regarding compliance provisions, particularly those pertaining to enforcement and penalty provisions. From holding face-to-face meetings with the management team to preparing briefing reports for board members, CPA, CGMAs are senior leaders’ valued resource for the news and information that help keep operations PPACA compliant and successful. To learn more about the CGMA designation, visit www.cgma. org.
303.740.9400
www.eksh.com Nov/Dec 2012
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Point/CounterPoint: Skiing vs. Snowboarding Alan Bennett, CPA
Diane Wightman, CPA
A “Professional” Evaluation of Skiing
Snowboarding is Gnarly
It’s fairly simple to recognize the many advantages of skiing over snowboarding. Unlike our one-planked snow cousins, we ascend on lifts with comfort, traverse the flats of Vail with ease, and access the backcountry with a simple switch of our alpine touring bindings. Although both disciplines crave the same wintertime commodity, CPAs are properly consolidated into the Ski, rather than Snowboard, entity. Let us channel our profession in the evaluation of this powder power struggle. CPAs care about numbers, functionality, and risk. So, what’s the bottom line? Can we reconcile these differences? Skiing by the Numbers The current world record for speed skiing is 156 mph; that’s faster than the terminal velocity of a free falling skydiver. The swiftest snowboarder clocks in at 125 mph. Ski-PAs are checking their email or enjoying après ski by the time that race ends. Did I mention that skiers at the X-Games in Aspen jump higher and have access to a larger bag of air acrobatics? If adrenaline isn’t your game, then consider the boundless miles of tranquil skin track that lay in front of the backcountry skier (no split-board reassembly required). Skiing Offers Ultimate Functionality Much like your CPA certificate, ski equipment allows for ultimate versatility. Skiers routinely access and conquer a larger variety of terrain because of the superior control that our equipment provides. Snowboarders are often times relegated to lesser slices of the mountain. Skiers deftly skate cat tracks, break trail on backcountry routes, slay the steeps, cruise the corduroy, bang the bumps, and (if we’re lucky) float the deep. The young ones actually ski “switch” (backwards) these days! In addition, skiers benefit from greater vision of the mountain by simple virtue of our squared, downhill stance. Boarders descend sideways, often times surfing past optimal terrain located in their blind spot.
Gnarly: (adj.) 1. awesome, amazing 2. difficult, dangerous, or challenging When I moved to Colorado from Chicago eight years ago I quickly learned to love winter, especially SNOW! Previously, I had skied one time in high school — rolling down the hill with one leg sliding to the right and the other to the left. When my son encouraged me to try snowboarding, I thought, “Why not?” I already loved the stylish clothing. Here’s why I fell in love with snowboarding. The “Cool” Factor: It is undeniable that there is a certain “cool” vibe associated with riding that skiers just don’t have. Our clothes are designed to be comfortable and functional. We have more pockets to carry stuff; there is nothing better than taking a break on the mountain to enjoy a smushed PB & J sandwich. And don’t those one piece ski suits make you cringe? The Equipment: We only have one board to control as opposed to two skis. Boarders don’t need poles…enough said! Our boots are more comfortable; we can wear them all day and don’t need to walk on our toes. Most snowboards fit in the trunk of the average car — no rack needed. The Workout: Boarding is all about balance. It requires strong core muscles, making it a better workout. Snowboarding is easier on your knees and hips. The Learning Curve: Not everyone can learn to snowboard. It takes commitment, persistence, and tenacity to master. Snowboarding is harder to learn — as you need your entire body to navigate — but it is easier to completely master than skiing. Not everyone can master it though, which makes it unique, and puts you in a class by yourself. Once you can link turns and stop, it’s just a matter of going faster. The Ride: Boarding is about originality and diversity. It’s youthful and fun. Boarders tend to be friendlier and less uptight than skiers. We’re more adventurous and bigger risk takers. Because you
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Skiing
Continued
Risk Planning Sliding on two sticks is far from safe, but according to a study in the American Journal of Sports Medicine, “Injury rates in snowboarders have fluctuated over time but currently remain higher than in skiers.” Go ahead; you’re safe here, Mr. or Ms. Ski-PA — admit that you think about risk mitigation each time you buckle your boots (and over morning coffee). Carving the Bottom Line A basic cost benefit analysis might yield the following summary results: “Skiers jump higher, go faster, enjoy more terrain, and are overall less likely to defrost in the emergency room.” Snow sports are challenging pursuits, and snowboarding falls short of what we accountants desire most: the best solution to a difficult problem. Reconciliation Two-planks are indeed greater than one, but CPA snow riders of both persuasions do have one shared struggle: Why in the world did we choose a profession that requires the majority of our desk time to be incurred from January to April?s Alan Bennett, CPA, is an avid backcountry and alpine skier. When he isn't hitting the slopes, Bennet works in SM Energy Company's Operational Accounting Group in Denver. He can be reached at abennett@sm-energy.com.
Call for Writers
The times are constantly changing, and so is the subject. If you would like to participate in Point/CounterPoint, contact Krista Flynt at kflynt@cocpa.org.
Snowboarding
Continued
get more flex and pop on a board, tricks and jumps are easier and more exciting. Boarders are drawn to the half pipe and terrain park. You can’t do a Grab or an Ollie on skis. Plus we get to look up at the magnificent view of the mountain when riding toe side. My Thoughts: I admit there are a few downsides to being a boarder. It’s harder to get off the lift with one of your boots detached from your board. And until you have mastered riding, the “cat walks” are real thigh burners. Why do skiers always stop here? But here’s something to ask yourself, “Why is it that you know people who used to ski, but you don’t know anyone who used to board?” It’s irrefutable, the impact that snowboarding has had on snowsports in general. Its appeal to younger generations of snowboarders has significantly changed ski resorts. Years ago, skiing was prohibitively expensive and not as “cool” as you might think. Resorts were facing dwindling numbers every year. Snowboarding changed all that and caused the ski industry to innovate to keep up, giving access to a more diverse group of people. The Bottom Line: It doesn’t matter which appeals to you more, everyone is out there for the same reason — to enjoy nature’s playground and have a good time in the snow. Whatever you choose, have fun, be safe, and respect everyone on the mountain. Let it SNOW!s Diane Wightman, CPA, competes in the U.S.A. Snowboard Association’ s Rocky Mountain Region halfpipe and boardercross circuit. At the 2012 National Championships, she finished second in the halfpipe and third in the giant slalom. When not snowboarding, she chairs the COCPA Financial Literacy Committee and is owner of Controlled Resources Inc., Westminster. Reach her at dhwightman@gmail.com.
What's Up: Private PTIN Directories Have you received emails from companies that are publishing and promoting a list of persons who have registered with the IRS for a preparer tax identification number (PTIN)? These companies have purchased the Service’s PTIN list, which is permitted under the Freedom of Information Act (FOIA). Last year, the AICPA had numerous conversations with IRS staff questioning the appropriateness of the specific data items that the IRS released, such as mailing addresses, email addresses, and phone numbers. The Institute also suggested that the IRS: (1) provide an opportunity for preparers to “opt out” of the release of some or all of the personal and business information and (2) adequately communicate with PTIN registrants about the disclosure of their information. The Service revisited its FOIA releases and made some changes to partially restrict some of the data being collected from PTIN holders to protect their privacy. The IRS now permits tax return preparers to
list either a physical address or a P.O. Box as the “business address” when registering or renewing a PTIN. Any valid email address can be provided to the IRS as long as the PTIN holder regularly checks the email address for PTIN communications. These changes provide the PTIN holder with the ability to stop the release (under FOIA) of a tax return preparer’s home address or of an email address that the preparer doesn't want to be made public. The current directories of PTIN holders are private, commercially oriented ventures and are not endorsed by the IRS. The Service does have plans for some type of “look-up” data base of PTIN holders tentatively scheduled for launch after tax season in spring 2013. Because much of the PTIN list and data is publicly available under FOIA, legal action by the IRS or others is unlikely. Nevertheless, the AICPA has raised questions with the Service about the possible misuse of, or confusion about, the use of the PTIN data. The IRS is reviewing the matter and is considering appropriate action.s
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2013 Tax Update
Don't Let the Sun Set on Planning Opportunities
by Georgia Phillips, CPA
T
he climate surrounding tax law changes is starting to feel like a movie we’ve seen before — but we can't remember the ending. Given the looming certainty of “sunset” tax provisions, the inability of Congress to work toward amicable compromise, and the uncertainty of 2013 tax laws, we have “Groundhog Day,” a pending shoot-out at the OK Corral, and an M. Night Shymalan-esque mystery ending all rolled into one in our near future. A number of Bush-era tax cuts and incentives will sunset after 2012 — with their fate most likely in the hands of Congress after the November elections, and maybe well into 2013. These expiring tax cuts and incentives were first enacted in the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) and the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA). The 2010 Tax Relief Act extended the majority of these measures through 2012. We’ve seen this plot before — tax provisions set to expire by year end, with no clue what is looming for taxpayers in the year that follows. Will Congress have its “showdown,” duke it out, and reach a favorable compromise? Or, will perpetual gridlock take over? Unfortunately, given our lackluster economy and the increasing budget deficit, it is unlikely that many of the expiring provisions will survive unscathed. The most preferable outcome is a compromise solution that extends some variation of the expiring provisions over the next one or two years. Going forward, how do we proceed regarding income, business, and estate and gift tax planning issues for clients when the future of tax law is harder to read than hieroglyphics? At this point, the movie begins to unfold… Our responsible, trustworthy, and resourceful CPA has been mulling over the pending sunset of current tax provisions. Trying to quantify the magnitude of the issue, the CPA pulls out a pad of green ledger paper and begins to jot down a list of tax laws that will sunset in 2012.
Federal Estate, Gift, and GST Taxes • The maximum federal estate tax rate will increase to 55%.
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• The $5.12 million estate and gift tax exclusion reverts to $1 million. • Estate portability disappears.
Individuals
• Income tax rates are set to increase in each of the marginal tax brackets. • The basic standard deduction for a married couple filing jointly will no longer be twice the basic standard deduction for an unmarried single filer (aka the marriage penalty). • The phase-out of itemized deductions and personal exemptions returns. • The Child Tax Credit decreases from $1,000 to $500 and phases out more quickly. • Favorable tax rates for dividends and capital gains are set to increase. • The alternative minimum tax patch, which expired in 2011, is uncertain for 2012 and beyond. • The Coverdell education savings account maximum contribution reverts to $500, and more restrictive distribution rules apply. • Employer paid tuition assistance falls under the more strict working condition fringe benefit. • The student loan interest deduction is reduced. • The higher education tuition deduction is not available in 2012. • The American Opportunity Tax Credit ends in 2012, replaced by the returning Hope Credit. • Earned Income Credit rules will be based on modified adjusted gross income and reflect a larger marriage penalty. • The Child and Dependent Care Credit maximum is lowered. • The adoption credit and benefits are reduced.
Business
• Small business stock gain rules become more restrictive.
• The employer-provided child care credit disappears. • Bonus depreciation is no longer available. • Section 179 expensing limits decrease. Suddenly, our CPA feels like Bill Murray in “Groundhog Day.” It’s another year of tax law uncertainty — can this really happen two years in a row? Can the CPA competently consult with clients and provide guidance without concrete rules? The CPA's heart begins to race and her palms begin to sweat, when suddenly the CPA is jolted out of her momentary panic by a ringing phone. One of her most demanding, tax averse clients is calling and asks for year-end tax planning advice... How can we best advise clients? For starters, we can run multiple “what-if ” scenarios to maximize strategies and take advantage of tax laws in effect until the end of 2012. Accelerating both ordinary and capital gain income, if possible, to take advantage of certain low tax rates may be an option. Likewise, accelerating planned equipment purchases into 2012 in order to take advantage of more generous bonus depreciation and Section 179 expensing limits may be a useful strategy. We can encourage clients to take the plunge and complete their estate plans, taking advantage of the substantial gift tax exclusion available until the end of 2012. In addition to the expiration of the Bush-era tax cuts, other tax provisions are likewise scheduled to expire (or expired after 2011). Included in this category are energy tax incentives, the 2% payroll tax cut, the personal residence mortgage indebtedness exclusion, and the state and local sales tax deduction, to name a few. As if expiring tax laws aren’t enough to worry about, we can’t ignore the new tax provisions that will make their appearance for the first time in 2013. These include: • The medical device manufacturing tax • An increase from 7.5% to 10% in the threshold for deducting medical expenses • A $2,500 cap on flexible spending accounts
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• The 3.8% surtax on investment income • An additional 0.9% Medicare tax on higher income taxpayers Again, a prudent approach that takes into account currently favorable tax rates, level of risk (how lucky do you really feel?) regarding future rates, and a holistic assessment of a client’s individual and business needs, along with both short-term and long-term goals, is the best approach to cobble together a tax planning strategy for the remainder of 2012. We don’t have a crystal ball to predict the future, but we are armed with the knowledge of what is certain now. Decisions will have to be made using professional judgment and utilizing today’s facts and circumstances. We cut back to our CPA sitting in her office. Once again, the only two things that are certain are change and uncertainty. The CPA decides not to fret about things beyond her control. Tomorrow is another day. The CPA grabs her coat, leaves the office, and goes outside to enjoy the sunset. s Georgia Phillips, CPA, is a tax manager with Bauerle and Company, PC, Englewood. Contact her at gphillips@bcdenver.com.
2011 & 2012 “Best Companies to Work for in Colorado” 2010 & 2011 “Best Accounting Firms to Work For” Best – /best/ - of the highest quality, excellence, or standing. People. Culture. Client Service. Technical Expertise. Quality. 303.830.1120 www.acmllp.com Boulder ∙ Denver ∙ Northern Colorado
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The Colorado Education System: K-12 The Financial and Legislative Picture
I
n April 2011, the Center for Colorado’s Economic Future published an analysis of the fiscal sustainability of Colorado state government. The analysis was updated in August 2011 and again in March 2012. Simply put, the Center concluded that Colorado’s General Fund faces a serious structural imbalance because Medicaid growth and K-12 education spending will far exceed the growth rates of sales and income tax revenues.
...the long-term General Fund imbalance is a structural problem that will not disappear even with a robust economic recovery.
Budget Overview
— The Center for Colorado's Economic Future
The state budget totals about $20.4 billion, with $7.5 billion in General Fund revenue — roughly two thirds coming from income taxes and one third from sales/use taxes. The balance of state budget revenues comes from cash funds (licenses, user fees, tuition, etc.) of about $6.2 billion; federal funds of about $5.2 billion; and about $1.5 billion in re-appropriated funds. On the expense side, almost 40% goes to K-12 education, about 33% goes to health care/human services, almost 13% goes to corrections/judicial, about 8% goes to higher education, and all other state government areas total about 5%. In contrast to prior years of reductions in education funding, the FY2012-13 budget contains flat per student funding for K-12 education. Nonetheless, 111 of Colorado’s 178 school districts will receive less funding because of their declining enrollments. The FY2012-13 General Fund appropriation is below the 40% share of total General Fund appropriation threshold for the first time since FY2000-01. This reflects decreases in support for K-12 education in the last few years as well as substantial increases in appropriations for Medicaid. Prior to FY2009-10, Sec. 24-75-201.1 C.R.S. restricted the increase in General Fund appropriations to the lesser of either 5% of Colorado personal income or 6% over
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the total General Fund appropriations of the previous fiscal year. Since passage of this provision, the lesser amount had been 6% over the previous fiscal year's appropriations. Referendum C, passed by Colorado voters in November 2005, authorized the state to retain and spend monies in excess of the constitutional limitation on state fiscal year spending. Within the General Fund, the measure established the General Fund Exempt Account which consists of the revenues in excess of the limitation on spending that Colorado would have been required to refund if Referendum C hadn’t passed. Monies in the account must be appropriated or transferred to fund health care; education,
including related capital construction projects; retirement plans for firefighters and police officers (as the General Assembly deems necessary); and strategic transportation projects in the Department of Transportation’s strategic transportation project investment program. In 2009, passage of Senate Bill 09-228 amended Colorado law to restrict General Fund appropriations to an amount equal to 5% of Colorado personal income. This year, as a result of the passage of House Bill 12-1338, $59 million of the General Fund excess that exceeds the 4% reserve requirement for FY2011-12 — and all of the excess General Fund reserve at the end of FY2012-13 — must be transferred to the state Education Fund. That’s the dollars and cents backdrop against which Colorado educates its youngest citizens.
Funding Hobbles If you ask people involved with Colorado’s education system where improvement is needed, the first word you’ll hear is “money.” “The student population in Colorado is growing,” says Jane Urschel, Ph.D., deputy executive director of the Colorado Association of School Boards. “School funding in
Program ($ in millions)
General Fund
% of Total
Education (K-12)
$3,015.4
39.8%
Health Care / Human Services Corrections / Judicial Higher Education General Government* Other
$2,499.1 $1,003.4 $619.3 $60.9 $371.4
33.0% 13.3% 8.2% 0.8% 4.9%
TOTAL
$7,569.5
100.0%
* Includes the Governor's Office, the Legislature, and the Dept. of Personnel and Administration.
Colorado is supposed to be growth plus inflation, and Colorado isn’t doing it. We are tremendously underfunded per the mandates that have been put into policy. The legislature is asking us to do more things with less money.” Public school funding is complex, to say the least. Section 2 of Article IX of the Colorado Constitution requires the General Assembly to provide for the "establishment and maintenance of a thorough and uniform system of free public schools throughout the state." To comply with this provision, the General Assembly has established a statutory public school finance formula that takes into consideration the individual characteristics of each school district in order to provide thorough and uniform educational opportunities throughout the state. The school finance formula allocates funds among school districts by calculating a per-pupil level of funding for each school district, as well as a specific state and local share of funding for each district. The formula provides the same, statewide, base per-pupil funding amount for every school district ($5,843 per pupil for FY2012-13). The formula then increases this base per-pupil funding amount for each district based on factors that affect districts' costs of providing educational services. Thus, per-pupil funding allocations vary for each district. For FY2012-13, per-pupil funding allocations are anticipated to range from $6,059 to $15,099, with a statewide aver-
age of $6,474 per pupil. Each district's perpupil funding allocation is multiplied by its funded-pupil count to determine its total program funding. For FY2012-13, pursuant to the formula, a total of $5.3 billion in state and local funds will be allocated among school districts.
Gallagher and TABOR Two constitutional provisions, combined with a statutory provision in the School Finance Act of 1994, have limited property tax revenues available for public school operations: • In 1982, voters approved a property tax reform measure that included a provision (called the "Gallagher Amendment") which initially reduced the residential assessment rate from 30 percent to 21 percent and capped the residential share of property taxes. • In 1992, voters approved the Taxpayer's Bill of Rights (TABOR). Prior to TABOR, local governments could generally collect and spend the same amount of property tax revenue each year by periodically increasing or decreasing mill levies. With respect to school district property taxes, TABOR (1) imposes a property tax revenue limit based on inflation and changes in student enrollment; (2) prohibits districts from increasing a mill levy without voter approval; and (3) requires voter approval for any increase in the assessment rate for a class of property. As a result of the combined impact of
the Gallagher Amendment and TABOR, the residential assessment rate has declined from 30 percent to 7.96 percent (to keep the residential share of property tax revenues at about 47 percent), and school district mill levies have declined from the uniform mill of 40.080 (established by the General Assembly in 1988) to disparate mill levies that currently range from 1.680 to 27. These reductions, in combination with the inflationary spending increases required by Amendment 23, have caused the local share of total program funding to increase at a slower rate than overall funding, requiring the state's relative share of funding to increase. Specifically, from calendar year 1988 to FY2006-07, the ratio of the state share of funding to the local share of funding shifted from 43:57 to 64:36.
Colorado’s Rank How does Colorado stack up against other states funding-wise? The Colorado Legislative Council, the research arm of the Colorado General Assembly, cautions against rankings and comparisons because data differences and metrics used to compare states often cause confusion. For example, Legislative Council Staff calculated Colorado's K-12 funding rankings based on two common measures: per-pupil funding and funding per million dollars of personal income. Using these measures, Colorado's rank ranges from 34th to 48th in the country.
Many Options for Learning
E
ducating a child used to be relatively simple. When you turned five, you attended kindergarten at your neighborhood school. Maybe your parents chose parochial school or a non-sectarian private school for you. A friend might have been homeschooled, but in general, you and most children attended your neighborhood school. Families rarely strayed from the norm. That was then. This is now. Welcome to 21st-century Colorado where school choice, school funding, and parents who are demanding value for their money — whether it is thorough their tax dollars or tuition — have combined to create a diverse education envi-
ronment with more options than ever: public assigned, public magnet, public charter, homeschool, online, private, and independent. School choice means Colorado state law allows parents to choose any public (neighborhood or charter) school for their child, even if it is not in their neighborhood or school district. The child can then attend that school for free, unless it is full.
Colorado's Public System The National Center for Education Statistics (NCES) report, Trends in the Use of School Choice: 1983 to 2007, shows that the percentage of students enrolled in assigned public
by natalie rooney
schools decreased from 80 percent to 73 percent since NCES’s previous study. According to Colorado Department of Education (CDE) statistics, for the 2011-2012 school year, Colorado’s public school system was composed of 178 school districts, 1,780 schools, over 130,000 teachers, and more than 854,000 public school students. Colorado’s statewide public school pupil count increased by nearly 11,000 students from the 2010-2011 school year. The change represents an increase of 1.3 percent, the same growth rate as the 2010-2011 school year. For comparison, nationally, public schools saw a 2
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Education Continued from 13 percent enrollment bump in 2010. Statewide enrollment has grown every year since 1989, when the state’s total student count stood at 562,755. Sometimes public school systems get a bad rap, but Colorado’s public schools stand out from the crowd says Urschel. “Colorado’s public education system is leading the country on many fronts,” Urschel explains. “Data and technology are changing the face of public education, and we’re definitely seeing that in Colorado.” Colorado has a sophisticated system in place to collect data related to student performance and determine whether students are proficient and meeting state standards. While the process isn’t perfect, Urschel says CDE has developed a growth model that’s considered cutting edge in the U.S. “Even the U.S. Department of Education has acknowledged the value of this growth model which answers the questions of parents who ask, ‘What did you do with my child(ren) for the last 180 days?’” Urschel says. “We used to say, ‘Well, he or she seems happy at school.’ Now we have actual data to show where progress has been made and where progress is needed.” The data also is used to help teachers see where they are proficient and where they are not. Two years ago, the Colorado General Assembly passed Senate Bill 10-191 as part of an educator effectiveness initiative. The law changed the way both principals and teachers are evaluated, with the ultimate goal of continuously supporting educators' professional growth and, in turn, accelerating student results.
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The new evaluation requirements include opportunities for reflection, review, professional development, and growth. They include: • Annual evaluations for all teachers and principals • Evaluation based on statewide Quality Standards defining what it means to be an effective teacher or principal: The professional practice Quality Standards account for half of an educator's annual evaluation. The other half is based on the Quality Standard that measures student learning over time. • Non-probationary status (tenure) earned after three consecutive years of demonstrated effectiveness • Non-probationary status lost after two consecutive years of ineffective ratings All Colorado districts and the Board of Cooperative Education Services (BOCES) must implement an evaluation system that aligns with the teacher and principal Quality Standards and the State Board rules by July 2013. Although some controversy surrounded passage of the bill — opponents expressed concern about too much emphasis being placed on standardized testing, while proponents felt the bill could help improve Colorado’s achievement gap and graduation rates — Urschel says the law was never intended to be used as ammunition to fire teachers. “We pushed for Senate Bill 191 to become law so we’d have a system where teachers could grow,” she explains. Three other states — Delaware, Illinois, and Tennessee — have legislated similar reforms. Another important aspect of Colorado’s public education system was recognized when Senate Bill 08-212, Colorado’s Achievement Plan for Kids, was signed into law in May 2008. A landmark education reform initiative that created an aligned preschool to postsecondary educational system, the law established new standards and new assessments that enable all students to graduate from high school with the skills and the knowledge to succeed in today’s 21st century, ultra-competitive,
global economy. (Note: The four-year, on-time graduation rate for Colorado’s class of 2011 was 73.9 percent. Colorado defines “on time” as only those students who graduate from high school four years after transitioning from eighth grade. The national graduation rate is 74.7%.) What SB 08-212 did for Colorado kids was acknowledge that not everyone is going to college right out of high school, Urschel explains. “Before Senate Bill 212, vocational education was the step child, but career tech and career education are now almost on par with preparing students for higher education. Now they have a pathway to develop the skills they need.” Urschel calls Colorado’s recognition that there are multiple pathways students can take “an important milestone.”
Accounting for Public Schools Overseeing accounting for a state department of education is a lot like being a CFO in corporate America. Leanne Emm, CPFO, MPA, assistant commissioner for public school finance, wears many hats. She is responsible for the administration of Colorado’s public school finance laws, and she oversees programs such as nutrition, transportation, grants fiscal management, and the state’s Building Excellent Schools Today (BEST) program. Operating according to Governmental Accounting Standards Board rules, Emm says the major difference between accounting for the CDE versus a business is the use of fund accounting. “Different funds are set up and maintained for special purposes,” Emm says. They might include a general fund, a bond redemption fund, a capital reserve fund, etc. All districts (but not each individual school) must be audited and submit financials to Emm’s division according to a standardized chart of accounts. Emm’s division rolls together information from every district for submission to the federal government. The federal government uses the information from the automated data exchange to determine funding allocations for various fed-
Colorado
FY 2000-2001
FY 2011-2012
Change
State Population
4,456,000
5,116,800
14.8%
K-12 Enrollment
724,508
854,265
17.9%
General Fund (in millions)
$6,553
$7,478
14.1%
eral education programs run through the states such as the Individuals with Disabilities Education Act (IDEA), Title I (helping failing students meet academic standards), and Title II (teacher and principal training). The allocated money is funneled to states based on the numbers submitted. All school districts must be accredited by the state board of education, and one of the measurements for accreditation is finance. Overall, Emm says districts do a good job — only one district violated its accreditation contract last year because of financial issues. If a school district spends more than $500,000 in federal funds annually, it must comply with the Office of Management and Budget (OMB) Circular A-133 calling for an A-133 single audit of those federal funds. Like a basic financial statement audit, the A-133 audit, or single audit, validates financial information. In addition, the A-133 audit evaluates compliance with general and specific government grant requirements covering financial factors and non-financial factors such as program effectiveness.
Colorado’s Charter Schools A charter school in Colorado is a tuition-free public school governed by a group of parents, teachers, and/or community members as a semi-autonomous school of choice within a school district, operating under a charter contract between the members of the charter school community and the local board of education. The charter contract spells out the school’s goals, standards, education design, governance, and operations. A charter school and its district can negotiate the combination of funding the school receives, the package of services the school will buy from the district, and the outcome expected of the school (student performance indicators). School-centered governance, autonomy, and a clear design for how and what students will learn are the essential characteristics. Under Colorado law, a charter school is its own distinct legal entity, though when authorized by a local district, the school is still a part of that district.
Why Choose Charter? In 2012-2013, it is projected that there will be nearly 190 charter school campuses in Colorado serving over 80,000 students. This represents well over 10 percent of total K-12 public school enrollment in the state. Nationally, Colorado’s percentage of students in charter schools is second only to Arizona, says Jim Griffin, president of the Colorado League of Charter Schools. A more typical charter school population is 2 to 3 percent of the state’s student population. Charter school programs and the communities they serve are as diverse as the students they enroll. Some charters implement longer school days, while others implement curricula specifically designed for at-risk students, gifted children, pregnant/parenting teens, and more. Colorado’s 20-year-old charter school system is a strong one but will always be a work in progress, Griffin says. “Charter schools offer a different way to deliver public education by looking at the school as the key unit rather than the school district,” he says. “Colorado’s charter laws are about choice and an alternative delivery system for education.” While charter schools operate somewhat independently, state mandates still apply in areas such as audit standards, financial requirements, content standards, and testing. Charter schools can make their own decisions regarding employment and budgets. Griffin says charters offer a more flexible, parent-centered approach. “Charter schools have to listen to their customers,” he says. “Otherwise, they lose their students and will have to close their doors.”
Charter Financial Controls Charter schools receive state funding, like their traditional public school counterparts, but they prepare their own financial statements for submission to their local school district. Rick Boos, CEO of Boos Financial Services (BFS), specializes not only in helping charter schools develop necessary internal financial controls but also with developing processes for human resources and payroll — things that would be handled by the school district at a traditional school.
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What's Next
Lobato v. State of Colorado The Colorado Constitution mandates that the General Assembly “establish and maintain a thorough and uniform system of free public schools throughout the state.” In 2009, the Colorado Supreme Court ruled that is an enforceable mandate and that courts have the authority to review Colorado’s school finance system to determine whether it meets this constitutional standard. This ruling parallels those in dozens of other states, where similar suits have been filed. This is consistent with longstanding Colorado precedent. In 2005, a group of families, including the Lobato family, filed a lawsuit against the state arguing that the current school finance system is underfunded and allocates money in an “irrational and arbitrary” way that violates the “thorough and uniform” standard. The Lobato suit asked the court to determine whether Colorado’s school finance system is up to the constitutional task of “maintaining” a thorough and uniform level of education for all. The plaintiffs sought a declaration by the court that the current system of school finance established and maintained by the state legislature is not thorough and uniform and, as a result, violates the Colorado Constitution and the substantive rights of Colorado students. In December 2011, the District Court ruled in favor of the plaintiffs and held that the state’s school finance system is unconstitutional because it is inadequate and not rationally related to the constitutional mandate of a thorough and uniform system of free public education. The plaintiffs’ action for declaratory and injunctive relief was stayed until final action by the Colorado Supreme Court. The state is currently exploring its options regarding appealing the District Court’s ruling. Further action is anticipated in spring 2013 when the General Assembly will have to begin addressing the issue. s Nov/Dec 2012
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Education Continued from 15 Boos says that while charter schools have well-intentioned parents, most of them don’t understand the financial aspects of running a school. Boos says charter schools receive the same per-pupil funding as district schools. What they lose is a 3–3.5% administrative overhead fee which is retained by the district. Additional money is retained by the district to cover special education students. “Charter schools also have fewer resources to write grants so they rely heavily on parent and community volunteers to make their schools successful,” says Kendra Padgett, CPA, business manager at Boos Financial Services. “Without that help and support, it is difficult for charter schools to survive.” Finding and paying for facilities is one of the biggest challenges for charter schools, which must pay for their own buildings versus passing a separate bond issue as a district would. Padgett says there are companies which will work with charter schools to offer a mortgage when a building is needed. In addition, many districts work to include their established charter schools in any bond issues placed before their voters. Boos emphasizes that charter schools muct follow all CDE and state laws, which includes an annual audit. Sometimes financial reporting requirements for charter schools exceed those of traditional schools, Padgett says. “What the school district wants to see may be different from what the charter school’s board wants to see,” she says. “This creates complexity for the charter schools.” Relationships between charter schools and their districts can run the gamut and can change over the years, Boos says. “If a district is growing and running out of space, charter schools provide a place to handle excess capacity," he says.
Colorado’s Non-Public Schools The term "non-public school" applies to private, parochial, and independent schools. Neither CDE nor any local board of education has jurisdiction over the internal affairs of K-12 private, independent, or parochial schools in Colorado. All preschool programs must be licensed by the Colorado Department of Human Services, but the state does not require licensing or accreditation for
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non-public schools with students in grades K-12. Colorado’s independent schools are funded primarily through tuition, charitable contributions, and endowment income — not through tax or church funds. This allows the leadership of each school to determine the nature and purpose of its educational programs. Because CDE does not regulate private schools, the number of students attending is difficult to pinpoint. Data from 2010 estimates private school K-12 enrollment at 50,209. This is down sharply from a 2007 estimated high of 60,945. Colorado may have as many as 300 non-public schools, but no one really knows, says Lee Quinby, executive director of the Association of Colorado Independent Schools (ACIS), a non-profit organization providing accreditation, professional development, and advocacy services to its member schools. It is affiliated with the National Association of Independent Schools (NAIS). Voluntary accreditation programs offer third-party quality assurance to help parents determine which schools are worth their investment. The North Central Association of Colleges and Schools (NCA) is another accrediting option for Colorado’s nonpublic schools. NCA is a membership organization, consisting of colleges, universities, and schools in 19 U.S. states (including Colorado), which is engaged in educational accreditation. It is one of six regional accreditation bodies in the U.S., and its Higher Learning Commission is recognized by the U.S. Department of Education and the Council for Higher Education Accreditation (CHEA) as a regional accreditor for higher education institutions.
The Independent Niche Research shows that high academic achievement is not the sole reason why parents choose independent schools. The NAIS Parent Motivation Survey indicates that many parents select an independent school because it develops “strong moral character” as well. Quinby says that effective character education depends on many factors, including the school mission, leadership, class size, quality of teaching, student engagement in learning, parent involvement, and agreement on core values. Mission-driven independent schools can be
very successful at combining these elements to support moral development. Education for leadership, higher levels of individual attention, and safety — both physical and emotional — are additional reasons parents say they choose independent schools.
Financial Sustainability Since the 2008 economic downturn, Quinby says accreditation teams are looking more closely at nonpublic schools’ finances. Every ACIS accreditation team now includes a business manager to evaluate school finance. Like universities, private schools have seen their rate of tuition increase exceed the rate of inflation year after year. “It’s widely recognized that it can’t go on at this rate. It’s not sustainable,” Quinby says. As a result of recessionary times, many schools are seeing families that didn’t previously qualify for financial aid now apply and qualify. “Schools in the NAIS have found themselves committing ten to twenty percent more money to support financial aid to maintain enrollment and retain students,” Quinby says. “This commitment of resources is necessary because the loss of just a few students can sometimes have a negative effect on a school. Tougher economic times make enrollment management more challenging for independent schools, particularly with increased competition from charter schools.” Quinby says that independent schools have responded to the increased demand for financial aid in a variety of ways, including taking money from reserves, reallocating other funds, and cutting budgets. He says it’s a delicate balance to find ways to slow the rate of tuition increases, while attracting and retaining high quality faculty and staff. “Schools have become more careful about spending and more sophisticated about financial planning. ACIS requires multi-year financial planning as part of the accreditation process. Many schools have taken that further with carefully researched trend projections and elaborate financial modeling." ACIS requires its schools to have an annual audit. “When we do a school evaluation, we look at the audit and the management letter to identify whether there are significant deficiencies or material weaknesses in a school’s financial management,” Quinby says.
Other Education Options CDE’s Innovation, Choice, and Engagement Division focuses on expanding learning opportunities for each student by looking beyond the typical school building, day, and calendar. In response to parent demand and a changing educational landscape, the CDE has worked to increase the supply of quality online and blended learning options, support new choice schools and programs, and replicate the successful programs.
Magnet Schools These are schools operated by a school district with a special focus such as a math, music, science, or an educational program such as a Montessori school. Originally, magnet schools were an alternative to court-ordered desegregation achieved by busing students. Today, the U.S. Department of Education defines the magnet school as a public school or program that aims to bring together students who have a variety of racial and ethnic backgrounds in order to voluntarily eliminate, reduce, or prevent the isolation of races and create an academic focus or social focus on a chosen theme. A magnet school has the same governance structure as any other public school and does not charge tuition. It follows the same laws and regulations, and its teachers, administrators, and other staff are required to be state certified.
CDE statistics for 2011-2012 showed 16,221 students registered in online educational programs, representing 1.9 percent of all students. In 2002-2003, there were just 1,987 students in online programs, and, at the time, those students reflected .26 percent of statewide enrollment.
Homeschooling Fall 2011 CDE statistics show more than 6,000 Colorado children were being homeschooled, down from a 2007 high of 7,445. Homeschooling is deregulated in Colorado. Parents assume all responsibility for the student's education including acquisition of books, supplies, tests, and maintaining permanent records. A parent who intends to establish a nonpublic, home-based education program is
not required to: provide written notification of the program to a school district within the state until the parent's child is six years of age; establish the program until the parent's child is seven years of age; or continue the program or provide the notification after the child is 16 years of age. The CDE website, www.cde.state.co.us, offers guidance for parents about everything from the application process to books, curriculum, and standards. Parents cite numerous reasons as motivations to homeschool their children. The three reasons given by the majority of U.S. homeschooling parents are concern about the school environment, to provide religious or moral instruction, and dissatisfaction with academic instruction at public and private schools. s
Online Schools Online schools represent one of the fastest growing areas of K-12 education. CDE defines an online school as "a full-time, online education school‌ that delivers a sequential program of synchronous or asynchronous instruction from a teacher to a student primarily through the use of the Internet." The multi-district online schools, singledistrict online schools, and single-district programs offer full-time online education and are authorized by a Colorado school district, BOCES, or the Charter School Institute, all of which are accredited by the State of Colorado. Multi-district online schools may accept students from across Colorado, regardless of their home school district. Single-district online schools and programs serve students only from the authorizing district.
For Further Information Financing Colorado's Future: An Update, March 2012 www.du.edu/economicfuture/update_march2012.pdf CO Joint Budget Committee Appropriations Report FY 2012-2013 www.state.co.us/gov_dir/leg_dir/jbc/FY12-13apprept.pdf Colorado Business Economic Outlook 2012 http://leeds.colorado.edu/asset/publication/2012beof.pdf National Center for Education Statistics http://nces.ed.gov/ 2012 Colorado General Assembly Legislative Session Review - Tomlinson and Associates www.lobbycolorado.com/FileRepository/documents/2012ReviewFinal.pdf
Nov/Dec 2012
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It’s Not You. It’s Me: How to Fire a Client by natalie rooney
T
hey say that breaking up is hard to do, and that might be particularly true when it’s time to break up with a client. What should you do? When should you do it? But most importantly, why should you do it? The experts lay it all out for you in this break up how-to.
Why You Should Do It The U.S. and world economies are still clawing their way back from the worst recession in history, so why in the world would you want to intentionally get rid of a client? In pre-recession times, culling the client list was all about capacity issues, says Mark Koziel, CPA, CGMA, vice president of Firm Services & Global Alliances at the American Institute of CPAs (AICPA). “As firms were trying to grow, it was a good time to look at client lists, rank the clients, and fire the ones who didn’t make the grade.” Then 2008 rolled around, and accounting firms found themselves hanging onto clients they probably shouldn’t have, and worse yet, bringing in bad clients. “Firms were actually bringing in D clients, dropping fees, and giving discounts to those who weren’t even asking for them just because they needed the work,” Koziel says. In addition to having those D clients on the client list, some clients are just not nice to work with, behaving in an abusive manner towards staff or even partners. Bad behavior aside, are there other reasons to give a client the boot? Absolutely, says Ron Seigneur, CPA, Seigneur Gustafson LLP in Lakewood, who over the years has parted ways with clients for many reasons including slow payment, clients who take an overly aggressive position on tax deductions, or clients who no longer fit with the services the firm is offering. It’s the clients with overly aggressive positions that can cause your firm trouble, cautions Seigneur. “If something doesn’t smell right, at some point you have to draw the line because more audit activity is occurring, and you don’t want your firm to get the blame.”
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Regardless of the reasons for firing a client, it’s an uncomfortable situation for anyone, says Mira Finé, CPA, partner at Hein and Associates LLP in Denver. Finé says it can be especially tough for younger practitioners. “When you’re younger, you might not yet have developed that sense that something’s wrong.”
Deciding Who Stays and Who Goes Koziel recommends using an objective process to evaluate your client list. The AICPA’s Private Company Practice Section (PCPS) offers members access to an Excel template for evaluating a client based on five criteria: pricing, timing, stress, risk level, and overall satisfaction. The template includes six key areas. Each area receives a rating that will ultimately result in a final score and assigning the client a letter grade from A to D. The areas are: • Job Risk/Complexity
• Job Recovery/Profitability • Referral Source/Client Tie-In • Additional Potential Services • Timeliness of Payment • Client Satisfaction The spreadsheet automatically tabulates your inputs to produce the ranking. An A ranking represents your most valuable clients, while a D ranking is the least valuable. The benefit of using the PCPS tool versus merely discussing a client’s attributes is its impartiality. It removes excuses and encourages objective discussion after the results are calculated. Users of the tool might see that their D clients are taking up 80 percent of their time, yet providing only 20 percent of the profitability.
The Breakup Meeting You’ve completed your evaluation process, and the writing is on the wall. The spreadsheet is a great tool for deciding your next steps. The bottom line is you don’t want D clients. And C clients could rep-
resent a borderline situation. The top of the range, A clients, can represent opportunities, revealing where you should be spending the majority of your time and helping you focus on converting B clients to A's. If you’ve reviewed the D's and C's and there is no way to move them higher on the scale, it’s time to say goodbye.Is there an ideal time? Koziel recommends the fall when old work is typically finished. You can choose to break up in person, over the phone, or by mail — you decide how your Dear John message would best be handled. If you choose an inperson meeting, Koziel suggests a crowded public place over lunch. After ensuring there are no sharp utensils nearby, you deliver your message: “It’s not you. It’s me.” Hopefully you can make it out the door without their arms around your legs, begging you not to leave them. Kidding aside, Koziel says that in many instances, a client/firm breakup isn’t the client’s fault. “Many times these are situations we’ve created and allowed through pricing, by discounting up front, and never doing anything to change it. We’ve gone through the years afraid to have the discussion, and now it’s extreme. It’s time to let go.” Seigneur agrees that many problems in the client/firm relationship can be traced back to the beginning. “Maybe it was a relationship we should never have taken on in the first place,” he says. “Maybe they’re falling behind on their bills or becoming more difficult to work with, but you can usually see it coming. When you get to the point of parting ways, you need to ask yourself, ‘Is there something I can learn from this?’” Seigneur says if you see other clients headed in the same direction, address the situation immediately. When you meet with your soon-to-be ex-client, choose your words carefully. Despite the fact that you’re breaking up, you don’t want to burn bridges or offend. Phrases like "the firm is going in a new direction;" "we can’t serve you in the way you need to be served;" or "we all need to go in a new direction" are general options. “Take the ‘let’s just be friends’ approach,” Finé suggests. You can even make recommendations for firms that might be able to better serve their needs. Regardless of how you deliver your message, follow up in writing to ensure everyone is clear on your new relationship status. See the sidebar for advice on this step.
PCPS Resources The AICPA Private Companies Practice Section provides useful tools and resources for firm practice management. To join, visit http://pcps.aicpa.org. s
Making it Legal While firing — or parting ways with — a client may be best for all involved, practitioners should always ensure their legal bases are covered before, during, and after the process. John Shutkin, general counsel with CliftonLarsonAllen LLP, says you won’t violate any law by firing a client. In fact, Shutkin says CPAs should make it a habit to fire clients more often. “Liability insurance companies actually want to see that you fire clients,” he says. “If you’re not firing, you’re likely keeping high-risk clients on the list, and they don’t like that.” He offers the following recommendations: Memorialize it. That’s legal jargon for put it in writing. Whether it’s a letter, an e-mail, or, at the bare minimum, a note in the client file, make sure there is a written record terminating your relationship. In addition, if you haven’t heard from a client in a while, don’t assume that means it's no longer your client. There is plenty of room for misunderstanding on this point. If you want to end the relationship, force the issue, and make it official. This applies if you fire the client, or the client fires you. Keep it short and sweet. “There are no magic words,” Shutkin says. “But, generally, the shorter the better.” You will need to formalize the arrangements for payment of any outstanding fees, and detail how workpapers will be handed over to a successor after payment — or will not be, if you are not paid. Workpapers belong to the firm, but, as a courtesy, these are usually handed over to the new firm if you have been paid. Conversely, any information the client has handed over — tax returns, schedules, copies of leases, and other client documents — the client owns. You have an ethical obligation to return them, whether you have been paid or not. Keep it clean. And, as tempting as it may be, don’t exacerbate the situation with inflammatory language. “If you feel the need to write a scathing letter, draft it, read it to yourself, and then cross it all out and replace it with neutral language,” Shutkin advises. However, for your protection, you may need to include some language in the letter advising the client that you are taking steps to terminate the relationship because, for example, it has not provided information in a timely manner or has been otherwise uncooperative. You’ll do this neutrally, of course. Consider your next steps carefully. Don’t be surprised if you get a response from your now former client who may not be in complete agreement with you. The client may take issue with your comments, may make inflammatory comments, or may say it’s going to sue you. At that point (if not sooner), Shutkin suggests talking to an attorney to determine whether you should respond, and, if so, how. The bottom line: Just because you send a letter, it may not be the last word. There will, of course, be exceptions to every one of these recommendations. Shutkin suggests consulting with an attorney throughout the process to make sure you are doing things appropriately for your situation. Shutkin also notes that, when public company audits are involved, it’s a whole different ball game due to required SEC filings (8-Ks) documenting the resignation and related matters (e.g., accounting disagreements, if any). Definitely consult with an attorney. Nov/Dec 2012
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The State of the Industry
Gaming In this column, NewsAccount talks with CPAs from various industries that are important in the U.S. and Colorado economies. We ask: What’s happening today? What factors will affect your industry over the the next 12 months? In this issue, we focus on gaming.
Ron Kammerzell
Director Colorado Division of Gaming Denver, CO
About the Organization
The Colorado Division of Gaming, a division of the Colorado Department of Revenue, is responsible for the regulation and enforcement of limited gaming in Colorado. The division — with offices in Golden, Central City/Black Hawk, and Cripple Creek — employs a staff of 92 people, which includes investigators, auditors, accountants, administrators, and support personnel. Among the duties of the division is the investigation of gaming license applicants — who must submit to a thorough background review. Division investigators scrutinize personal and financial histories of applicants, including the sources of all money that applicants plan to invest in a proposed establishment. Division investigators also patrol casinos during all hours of operation to handle patron complaints and observe for possible violations of gaming laws and regulations. All division investigators have the powers of peace officers and are certified as such. The division also is very involved in other day-to-day activities of limited gaming. In the first 20 years of gaming in Colorado, the division’s Licensing Section processed nearly 40,000 new licenses for casinos and casino employees. The division’s Audit Section conducts revenue and compliance audits of casinos to make sure establishments are following stringent accounting and compliance procedures to support the proper reporting and payment of taxes. The Audit Section
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NewsAccount Nov/Dec 2012
by Natalie Rooney
develops and updates the Internal Control Minimum Procedures (ICMP) that casinos are required to implement in order to facilitate an adequate control environment. The Section works closely with casino Internal Compliance Officers in reviewing proposed variances to the ICMP, reporting and resolving noncompliant issues, and developing internal control testing processes. Additionally, the Audit Section is responsible for publishing the Gaming Fact Book and abstract. The Technical Systems Group (TSG) oversees all gaming system technology and
applications in the Colorado gaming industry, such as cashless wagering, server-based and downloadable gaming, wireless technology, network security and architecture, and wide-area slot machine progressive jackpots. This group is responsible for adequately understanding the full regulatory impact of developing technologies and develops strategies, procedures, regulations, and internal controls to implement technologies as they emerge, to attempt to meet the market demand for them. TSG monitors the installation and upgrades of all systems to ensure
they are approved and comply with the gaming laws of Colorado. The Field Operations Unit monitors all gaming devices and related media in Central City, Black Hawk, and Cripple Creek. This unit is tasked with ensuring each of the approximately 15,000 electronic gaming devices offered for play in Colorado’s limited gaming jurisdiction are approved for use and are in compliance with state law. The unit assesses the regulatory impact of new game platforms and monitors field trials related to new games and platforms. Field Operations, along with TSG, provide oversight and regulatory interpretations to the independent testing lab, Gaming Laboratories International, for all games, devices, and systems in their respective areas of expertise.
What role does gaming play in Colorado’s economy? Limited stakes gaming plays an important role in Colorado’s economy. An economic impact study commissioned by the Colorado Gaming Association in 2011 estimated that Colorado commercial casinos directly and indirectly generate over 27,000 jobs per year. The study also estimated that Colorado commercial casinos generate over $2 billion each year in gross domestic product for the state. Since the inception of limited stakes gaming in 1991, Colorado casinos have reported over $12.2 billion in adjusted gross proceeds (gross gaming revenue) and paid nearly $1.7 billion in gaming taxes to the state. These gaming tax proceeds are dis-
tributed annually to local governments and state programs including the general fund, History Colorado, tourism promotion, and community colleges. Since the inception of limited stakes gaming in Colorado, the Colorado Limited Gaming Control Commission has distributed more than $1.5 billion to various fund recipients.
What challenges face Colorado’s gaming industry? Perhaps the greatest challenge facing the gaming industry in Colorado is competition from neighboring states and measures to expand legalized gambling to other venues within the state. The gaming industry is not recession proof as we have seen in gaming jurisdictions throughout the United States over the past four years. However, the gaming industry in Colorado has been able to weather the storm and experienced modest growth in adjusted gross proceeds last year. This can be attributed, in part, to the passage of Amendment 50 which went into effect in July 2009 and expanded betting limits, game types, and hours of operation. However, it can also be attributed to business savvy on the part of casino operators who have controlled their operating costs and found creative ways to preserve their market share.
What is your role within the Division of Gaming? I have been the director of the division since January 2006. I have worked for the division in various capacities since 1992
including auditing and investigations. My role as the director is analogous to being the captain of a ship. I am responsible for setting the course for the division and keeping an eye on the horizon to ensure we steer clear of hazards and take advantage of opportunities. Our constant focus is on technological advancements in the gaming industry, and we are always looking toward and preparing for where technology will be five years from now. Our regulatory framework is built on the foundation of honesty and integrity in the Colorado gaming industry. Our processes are developed to instill public confidence in gaming and to balance our regulatory responsibilities with reasonable regulation for the industry.
Is this a good time to be in the gaming industry? I would like to think so, and current trends here in Colorado suggest that others feel the same way. We have seen a flurry of new capital investment into the Colorado market in the form of purchases of existing casinos and new development plans on the horizon. Local, regional, and national gaming companies with balance sheets flush with cash are taking advantage of opportunities to invest in capital improvements and acquisitions in Colorado. The fact that gross gaming revenues experienced a modest increase in fiscal year 2012 is a good sign that there are brighter days ahead for gaming in Colorado.s
FAF Appoints Inaugural Private Company Council
O
n Sept. 19, 2012, the Financial Accounting Foundation (FAF) announced appointment of the chair and members of the Private Company Council (PCC) — the new body that will work with the Financial Accounting Standards Board (FASB) to determine whether and when to modify U.S. Generally Accepted Accounting Principles (U.S. GAAP) for private companies. Named chair was Billy M. Atkinson, who served as chair of the National Association of State Boards of Accountancy (NASBA) from 2009 to 2010. Also appointed to the Council were: George Beckwith, vice president and CFO, National Gypsum Company, Charlotte, N.C.; Steven Brown, vice president, US Bank, Portland, Ore.; Jeffery Bryan, partner, Dixon Hughes Goodman LLP, High Point, N.C.; Mark Ellis, CFO, PetCareRx Inc., Chappaqua, N.Y.; Thomas Groskopf, director and owner, Barnes, Dennig & Co., Ltd., Cincin-
nati; Neville Grusd, president, Merchant Financial Corporation, New York City; Carleton Olmanson, managing principal, GMB Mezzanine Capital, Minneapolis; Diane Rubin, partner, Novogradac & Company LLP, San Francisco; and Lawrence Weinstock, vice president finance, Mana Products, Inc., Long Island City, N.Y. FASB Chairman Leslie F. Seidman said, “The FASB welcomes the appointment of the new members of the PCC and looks forward to working with them to address critical issues facing the users, preparers, and auditors of private company financial statements. Our first task will be to agree on a framework with the PCC for making decisions about whether and when U.S. GAAP should be modified for private companies. We look forward to meeting in the fourth quarter.” FASB member Daryl E. Buck will serve as the FASB liaison to the PCC. For more details, visit www.accountingfoundation.org.s Nov/Dec 2012
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Professional Liability Insurance Options The following carriers write professional liability insurance for Colorado CPAs. CAMICO is the Colorado Society of CPAs sponsored program, available only to COCPA members. Information on other carriers is provided as well. You must perform your own due diligence with respect to the coverages offered. You may call the listed insurers directly, call the local agent, or contact the insurance professional who handles your business insurance coverages to inquire about these carriers. The A.M. Best Ratings shown are as of September 2012.
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A
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1800 Gateway Drive, Suite 300 San Mateo, CA 94404 Shelly Robison, Colorado Representative 650-378-6825 or 800-652-1772, ext. 6825 Fax 800-496-9910 inquiry@camico.com or srobison@camico.com www.camico.com
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Philadelphia Insurance Companies
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Kim Stone-Vilim 800-447-4626 or Fax 630-208-7550 kstone-vilim@insightinsurance.com
The Hartford Navigators Insurance Company
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www.rpsins.com
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NewsAccount Nov/Dec 2012
A-XV
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550 W. Van Buren, Chicago, IL 60607 Linda Deiss 800-776-7475 or Fax 312-803-2170 ldeiss@rpsins.com
A
John Torvi 800-336-5422 or Fax 800-344-5422 johnt@landy.com
Through Insight Insurance Services, Inc.
Risk Placement Services, Inc.
B++
75 2nd Ave., Suite 410, Needham, MA 02494
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Lloyd’s of London
A
Through Herbert H. Landy Insurance Agency, Inc.
11801 Research Drive, Suite C Alachua, FL 32615-6818 Bill Thompson, CPA, RPLU 800-272-0290, 386-418-4003, Fax 386-418-4004 bthompson@cpamutual.com
Colony Specialty Insurance Company
CAMICO Mutual Insurance Co.
Navigators Insurance Company
Cathy Whitley 214-989-2363 cathy.whitley@aon.com www.cpai.com
CPA Mutual Insurance Company of America Risk Retention Group
CAMICO Insurance Program Liberty International Underwriters
A+ A
Philadelphia Insurance Companies
A+
Travelers
A+
Through The Liability Place, Inc. Insurance Agency 4705 Marina Dr., Suite 12, Carlsbad, CA 92008 Brent T. Eppley 888-786-8318, 760-720-0110, Fax 760-720-0330 brent@liabilityplace.com www.liabilityplace.com
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Classifieds
What’s Not in Your Inbox? Looking for the latest update on professional issues from the Colorado Society of CPAs that someone mentioned to you – but you didn’t receive? Wishing you’d get advance notice of member events by email? Help us make sure you get what you want and need by providing your current email address. To update your member record, change your email address, or indicate you want to subscribe to email communications from the COCPA, go to www.cocpa.org and hover over the My Account link. Click on Update Personal Profile and scroll down to review your communications preferences. Or, contact the COCPA office at 303773-2877 or 800-523-9082. We’ll take care of you — and your inbox.
NewsAccount and Web Classified Advertising Rates $55 for the first 40 words. $2 per word thereafter. $10 discount for placing both a NewsAccount and web classified ad. E-mail Krista Flynt at kflynt@ cocpa.org for a price quote and to place a classified ad.
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NewsAccount Nov/Dec 2012
Opportunities Available Denver CPA firm with 3 shareholders in a 10-person office would like to attract a partner level person who is interested in a near-term ownership opportunity (6-18 months). Our firm provides a wide variety of services including tax planning and compliance (60-70%), audits, compilations, reviews, business consulting, and estate planning. Industry specializations include new car dealerships and non-profit organizations. The ideal candidate would have 1020 years of recent CPA experience, a solid background in taxation and accounting, strong leadership skills, a good understanding of practice building, and good client retention skills. The ability to research and interpret tax laws is a must, and human resource experience would be helpful. If this opportunity seems to fit your background and career goals, please e-mail your resume or letter of interest (in confidence) to jtanner@htdcpas.com. Tired of hectic city life? Why not try the slower pace of a quiet community? Growing Southern Colorado tax and consulting practice is seeking experienced tax professional. Skills must include proficiency in tax preparation, ability to multi-task and manage engagements, independent thinking, and strong communication skills. CPA with minimum five years tax experience. Relocation a must. Email resume to jgrahamcpa@yahoo.com. Regional, growing, family-oriented CPA firm seeks an individual interested in a permanent part-time position. We are looking for a CPA for our expanding accounting
Movers & Shakers Chadwick, Steinkirchner, Davis & Co., P.C. Consultants and Certified Public Accountants, announced that Wayne A. Keeler, CPA, was promoted to principal. Dr. Karen Forrest Turner was promoted to Assistant Dean of the University of Northern Colorado Monfort College of Business.
and auditing practice for the period January 1 through May 15 each year. If interested, please send a letter of interest and a resume to debrab@hayniecpas.com. Office Space Great office space in a Class A Executive Suite. Location near I-25/Orchard Rd., Greenwood Village. Office suites from 115 to 285sf. Rates starting at $500 per month. Front desk receptionist, conference room use, free parking, mail delivery included. Ask about 1 month free rent. Contact 303-7796700, dishan@corporateofficeconcepts.com. Practices for Sale, Purchase, or Merger Fred Mehring, Select Business Group, Inc., specializes in the sale, merger, and acquisition of accounting and tax practices. Over 25 years of experience. Confidentiality stressed! Call Fred Mehring at 303-7713100, fax 303-477-6010, or fmehring@ selectbg.com. Miscellaneous CPA Focused IT Support. Live Consulting is the complete IT solution for CPA firms in Denver, Boulder, and Castle Rock. Plans and packages available to meet your unique needs. Solutions for Cloud Computing, Scanning and Document Management, Service Agreements, Virus and Spyware Removal, Complete Network Design, and Troubleshooting. To find out how you can save on recurring IT costs, go to www. LiveConsulting.com or call 303-217-3000 today! Client references available upon request.
In Memoriam We regret the loss of the following COCPA members. We extend our sympathy to their families and friends. Abraham M. Friedman Member since 1995 Englewood, CO Russell N. Johnson Member since 1974 Sterling, CO
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Hyatt Regency–DTC or Webcast
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Topics include: Accounting and Auditing Update
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