COCPA NewsAccount - 2014 - July/August Issue

NewsAccount July/Aug 2014

Colorado Society of CPAs

Employee Retention: Keeping Your Best People in a Growing Economy

Short Staffed in accounting or finance?

We can bring you the right people.

Whether your company needs a new CFO or additional accounting staff, we can help you find the right professional.

Rhonda K. Trimble, CPA

Thomas J. Trimble, CPA

Trimble & Associates, Inc. offers you: Over 25 years recruiting candidates at all levels ◆ 12 years experience in “Big 4” public accounting ◆ 23 years total public accounting experience ◆ Expertise in accounting, finance and business consulting ◆

If your business has hiring needs, please call us for a free consultation.

Remember - You pay no fee unless you select a candidate through us.

Potential candidates - call us if you’re seeking new challenges. Candidates never pay a fee, so email your resume to us at info@trimbleassociates.com.

We may have just the right position for you.

Whatever your business staffing needs, contact us today at 303-779-5800 or info@trimbleassociates.com Let us put our experience to work for you.

Trimble & Associates, Inc. ◆ Contingency Search for Accounting, Finance & Business Consulting 8400 E. Crescent Parkway, Suite 600 ◆ Greenwood Village, CO 80111 Phone: 303-779-5800 ◆ Fax: 303-779-0808 email: info@trimbleassociates.com www.trimbleassociates.com

Contents Features

}

4

The COCPA Story On June 6, Leadership Council participants explored the value of COCPA membership through storytelling.

10 Forensic Accountant Saves the Day

Meet Gracy Edna Edge, CPA, Debits and Credits heroine, and her creator Lyn Fraser, CPA.

12

Valuing a Startup Companies need to address many issues as their businesses grow, and all are key to sustaining growth.

14 Will They Stay or Will They Go?

How can you make sure your best people will stick with you?

18 What's New: 2014 Colo. Tax Laws Check out this summary of key 2014 legislation affecting Colorado taxpayers.

Departments

Imagine CPE without measuring credit in 50 minute hours. See page 6 for details.

}

2 Chair Column 26 Movers & Shakers 28 Classifieds

July/Aug 2014 • www.cocpa.org •

1

Chair Column

NewsAccount

Full Speed Ahead

A bi-monthly publication of the Colorado Society of Certified Public Accountants Vol. 60, No. 2 July | August 2014 Board of Directors Sheila M. Balzer Chair Steven R. Corder, Vice Chair Tawnya R. Ramirez, Treasurer Marc C. Hendrikson, Immediate Past Chair Mary E. Medley, Secretary Directors Victor A. Amaya, Craig A. Arfsten, Christine Benero, Kelly G. Boggs, Sharon S. Lassar, Mark J. Smith Editorial Board Jack Allgood, Kay R. Dragon, Georgia Z. Phillips, Patrick A. Lytle, Barbara J. Tedesko, R. Stephen Van Meter, Michael D. 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 Denver, 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 online at www.cocpa.org.

2

• NewsAccount • July/Aug 2014

Sheila Balzer, Scott Bush, Marc Hendrikson, and Steve Corder plan for the future at the 2014 AICPA Spring Council meeting in Scottsdale, Ariz.

W

hen we see change is on the horizon, our reaction might be to yield, slow down, or proceed with caution.

Change can be unsettling, but it means something new — whether it’s a way of thinking, doing business, or approaching problems — is coming.

In May, I attended my first AICPA Council meeting as your COCPA chair. I came away from the meeting with a sense of excitement. Change is definitely in the air, on both the state and national levels, as work continues to advance and evolve the profession into its next best iteration on many fronts.

Here is a rundown of a few highlights and exciting changes ahead on the national level.

Peer Review The AICPA is undergoing an initiative to revamp peer review. This is an important and necessary process because both the accounting standards and how business is done are more complex than when peer review was first implemented. The pace of change, more regulatory scrutiny, and ex-

panding services require our profession to be experts in assuring we’re monitoring everything we do.

As an auditor, I have a personal stake in this project. The AICPA has outlined short- and long-term initiatives, but ultimately, the goal is to move to a real-time process versus once every three years as the system operates today. The initiative is in its early stages; watch for a concept paper expected this fall.

The Future of Learning The AICPA and state CPA societies are taking a hard look at how CPE is provided.

Our profession is committed to lifelong learning as a core value. We go to classes, either in person or virtually, but how can we make sure learning is really taking place? The AICPA is leading an initiative toward competency-based versus compliance-based learning.

Four key recommendations come from the future of learning research: • Innovate and experiment.

• Ignite a passion for learning.

• Make learning personal.

• Measure what matters.

Each licensing jurisdiction has its own rules for measuring CPE, which means there are logistical and regulatory issues to be addressed.

Nonetheless, we all recognize the need to move to a more effective, progressive system. It’s also necessary for the COCPA’s long-term sustainability that we innovate and experiment. Not all the ideas being discussed will work, but it’s important to do everything we can to bring the best learning opportunities to you.

On the Home Front Closer to home, I’ve begun the annual Chair Tour, meeting with you and your colleagues across Colorado, delivering state and national news about the profession and talking about my platform: Stewardship, Strategy and Sustainability. Undertaken in three phases, it’s all about making sure the COCPA

is here to assist you for the long haul.

Phase One (completed in 2012-2013): The COCPA moved and downsized its offices, resulting in significant financial savings; right-sized the CPE curriculum; restructured the COCPA staff; implemented a new association management system; and launched the redesigned, e-commerce capable COCPA website.

Phase Two (in process 2014-2015): We will work with an outside consultant to create the roadmap for the future. The project will address the needs of the entire organization, both short- and long-term.

Phase Three (planned for 2015-2016): Focused on implementing the strategies which come from the consulting engagement, this phase will be Vice Chair Steve Corder’s primary initiative when he becomes COCPA Chair in May 2015.

The consulting project is all about being future-focused. Sometimes you need to bring in someone from the outside to give

you an unbiased opinion and shake up your thought processes. Every time I attend a national event, it’s apparent to me that the COCPA is doing a great job. We want to keep that up and make sure we’re doing the right things for the future, too.

The good — no, GREAT — news, is that the COCPA is financially strong. We have the capital to undertake projects such as this. What we’re not always great at doing is blowing our own horn. Many of the issues the staff handles are confidential. Plus, no one wants to brag. But we need to be better about sharing our stories and broadcasting to future members that COCPA membership is invaluable. It’s time for us to stop being so modest and let everyone see how great this organization is today and how it will be even better in the future.

I’m excited about the changes ahead of us this year. I hope you are, too. s Email your comments and suggestions to Balzer at sbalzer@hhlbcpa.com.

July/Aug 2014 • www.cocpa.org •

3

2014 Leadership Council Everywhere you go these days, you’re likely to hear, “We just have to do a better job of communicating! We need to tell our story better.” In that spirit, participants at this year’s Leadership Council conference, June 6, focused on storytelling and “Framing the COCPA Strategy Through Stories” with Be Story Driven founder Michael Collins.

4

• NewsAccount • July/Aug 2014

They explored what’s happening in and to the profession and the COCPA, as well as their own experiences with the Society. Through exercises such as The Rule of Three (creating a structure or pattern for a story) and 30:15:5 (telling a story in 30 seconds, 15 seconds, and five seconds — without just talking faster), they learned tools for making meaningful connections through stories and shared their thoughts on what the COCPA’s story is.

Alece Birnbach of Alchemy: The Art of Transforming Business captured the day’s discussions visually. The chart you see here is one of two she created to document the group’s work.

At day’s end, COCPA Vice Chair Steve Corder volunteered to demonstrate the 30:15:5 technique and crystallized the COCPA value this way: Quality People. Quality Answers. Quality Results. How would you tell the COCPA story? Share your thoughts with CEO Mary E. Medley at mmedley@cocpa.org. For copies of the graphic illustrations, contact Terry Cervi at tcervi@cocpa.org. s

July/Aug 2014 • www.cocpa.org •

5

The Future of Learning

Not Your Father’s CPE Task Force Recommends Strategic Change At the 2014 spring meeting of AICPA Council, the AICPA Task Force on the Future of Learning unveiled its four thematic recommendations for supporting the profession’s commitment to professional competency and lifelong learning: • Innovate and Experiment. Leverage technology to enhance learning experiences.

Implement small changes for a huge impact.

• Ignite a Passion for Learning. Start with the learner’s needs. Make learning engaging and relevant.

• Make Learning Personal. Filter content and focus resources that address individuals’ knowledge and competency needs. Deliver any topic, anywhere, any way.

• Measure What Matters. Rethink compliance to measure learning competency, development, or performance. Create and leverage a unified, global competency frame-

work. Develop one uniform, global compliance standard.

An interactive Future of Learning microsite, set to launch this summer, will offer opportunities for users to share information and ideas. It will feature learning strategies including just-in-time learning; gamification; nano-learning which is personalized, subjectspecific information supplied in small doses; and blended learning which combines classroom work and homework. An example is the “flipped classroom” where learners may watch videos or read information before class, and then spend class time discussing the material.

The recommendations were developed by a broad group of public accounting firm leaders, industry CPAs, leaders from the Chartered Institute of Management Accountants, regulators, association leaders, and educators who spent the past year discussing

major trends in education, reviewing promising innovations, and determining which changes might best apply to CPA professional development. The task force examined the changing business landscape, the rise of specialization within the profession, the shifting dynamics of the workplace, and the differing expectations that millennial CPAs bring to their careers and learning. For more on the project, go to www.aicpa.org. s

Regulation

AICPA Opposes IRS Voluntary Tax Preparer Program In late June, the AICPA received word that despite its efforts urging the IRS to consider alternatives and provide for a formal comment period to obtain and consider the public’s views before proceeding, the Service intended to issue a Revenue Procedure creating a voluntary tax return preparer program, essentially making the guidance final. On June 26, the IRS did just that.

In a June 24 letter to IRS Commissioner John Koskinen, AICPA Chair William E. Balhoff, CPA, CGMA, CFF, and AICPA President and CEO Barry C. Melancon, CPA, CGMA, wrote, “We have repeatedly expressed to you and your colleagues that our members have very significant concerns regarding a voluntary certification program…

We feel compelled to …raise more formally our legal and policy concerns with the IRS’s current path.”

Describing the proposed program as “unlawful and improper,” the letter cited several major issues:

6

• NewsAccount • July/Aug 2014

• No statute authorizes the proposed program.

• The program inevitably will be viewed as an end-run around Loving v. IRS (the federal court ruling rejecting an earlier IRS attempt to regulate tax return preparers).

• The IRS evidently concluded, in developing the proposed program, it need not comply with the notice and comment requirements of the Administrative Procedures Act – an incorrect conclusion.

• The current proposal is arbitrary and capricious because it fails to address the problems presented by unethical tax return preparers, runs counter to evidence presented to the IRS, and will create market confusion.

In announcing the program, the Service indicated that its new Annual Filing Season Program, to be in place for the 2015 filing season, is “designed to encourage education and filing season readiness for paid tax return preparers… and will allow unenrolled return preparers to obtain a record of completion

when they voluntarily complete a required amount of continuing education, including a course in basic tax filing issues and updates, ethics, and other federal tax law courses.”

According to Commissioner Koskinen, “(The) program will give unenrolled return preparers a way to stay up-to-date on tax laws and changes, which we believe will improve service to taxpayers.”

Tax return preparers who elect to participate in the program will be included in a database at www.irs.gov. According to the IRS press release, the database also will contain information about practitioners with recognized credentials and higher levels of qualification and practice rights, including CPAs, attorneys, enrolled agents, enrolled retirement plan agents, and enrolled actuaries who are registered with the IRS. For specific details about the program, visit www.irs.gov. For the latest information on the AICPA’s efforts, go to www.aicpa.org.s

2014 WOMEN TO WATCH AWARDS

COCPA Chair Sheila Balzer, selection committee chair Melissa Hooley, and keynote speaker Christine Benero joined the 2014 award recipients for a photo op: Mary-Margaret

Henke,

Tracy

Huggins, Judy Vorndran, Stacey Hekkert, Jessica Seidlitz, and Jenny Scholz. Friends, family, and colleagues feted the winners at Kevin Taylor's at the Opera House on May 22, 2014.

2014 Heroes & Heroines Sought Nominations Deadline Aug. 29, 2014

Each and every day, away from the headlines, in businesses large and small across Colorado, and in others’ lives, CPAs make a difference. We will honor their contributions with the 2014 Everyday Heroes and Heroines Awards, to be given at the CPAs Make A Difference celebration on Nov. 6.

The keynote speaker will be Craig Zablocki, described as "a hilarious guy who gets some serious results."

If you know a CPA who should be considered for the award please submit a nomination. Send a narrative, not to exceed three pages, explaining why you believe the candidate should be recognized and detailing the person’s accomplishments. Nominees must hold a CPA certificate and be a member in good standing of the COCPA. They also should be “everyday” heroes and heroines who haven't been recognized widely for their contributions.

Nominees should demonstrate significant service in one or more areas:

INVOLVEMENT: Describe the nominee’s level(s) of involvement; length of involvement; and time devoted to nonprofit organization(s) and community activities.

LEADERSHIP: Describe the nominee’s position(s) held and substantial accomplishments achieved in a community organization, including taking the lead in identifying and solving a problem, founding or rescuing an organization, or developing an innovative program.

IMPACT: Describe how the nominee’s actions benefited the community, improved the overall quality of life, helped others overcome adversity, or served as a role model for CPAs exemplifying the profession’s core values of integrity, competency, and objectivity.

For more information or to submit your nomination electronically, contact Terry Cervi at tcervi@cocpa.org, or call her at 303-741-8610 or 800-523-9082, ext. 110.

July/Aug 2014 • www.cocpa.org •

7

PFP Standards

New Personal Financial Planning Guidance Effective July 2014

BY CLARK M. BLACKMAN II, CPA/PFS, CFA, CIMA, CFP®, AIF®, AND DIRK EDWARDS, CPA/PFS, JD, MBA

I

f you’ve noticed that personal financial planning (PFP) services are on the rise, you’re not alone. This specialty practice is projected to grow at double the rate of growth of the accounting profession within the next three years. The Bureau of Labor Statistics projects that the number of personal financial advisors will increase 27% in the U.S. by 2022.

The rapid expansion of services in areas such as estate, retirement, risk management, and investments, and the increased demand for these services, has led to the need for enhanced and definitive guidance in the delivery of PFP services for the benefit and protection of clients and the firms serving them.

The AICPA Statement on Standards in Personal Financial Planning Services (otherwise known as “the statement”) provides CPAs with comprehensive, enforceable guidance on delivering PFP services consistently and competently. The statement, which is effective, July 1, 2014, aligns with the AICPA Code of Professional Conduct, which is to uphold the highest levels of integrity, professionalism, objectivity, and competence.

The Statement’s Purpose The statement elevates longstanding professional principles to authoritative, enforceable rules regarding the conduct of PFP professionals. It addresses the key areas of communication, disclosures, and documentation as they relate to the basics of engagement planning, the development of recommendations, and working with and recommending other professionals.

Topics within the nineteen-page statement include General Professional Responsibilities, Responsibilities of CPAs in PFP Engagements, Planning the PFP Engagement, Obtaining and Analyzing Information, Developing and Communicating Recommendations, Implementation Engagements, Monitoring and Updating Engagements, Working

8

• NewsAccount • July/Aug 2014

With Other Service Providers, and Using Advice Provided By Other Service Providers.

Following the statement ensures that your clients receive the information they need to make sound financial decisions and that you meet the standard of care expected of a trusted advisor in the provision of these services.

Does the Statement Apply to You? The statement applies to any AICPA member (and/or licensed CPA in jurisdictions that adopt the statement) who meets the definition as providing PFP services to individuals and represents to the public or to clients that he or she is providing PFP services. These are defined by the statement as “the process of identifying personal financial goals and resources, designing financial strategies, and making personalized recommendations that, when implemented, assist the client in achieving these goals.” They include one or more of the following planning activities: cash flow; risk management and insurance; retirement; investment; estate, gift, and wealth transfer; elder; charitable; education; or income tax.

CPAs who do not hold out as providing PFP services may still be subject to the statement if they would be required to register as an investment advisor or if they sell financial products to individual clients. For guidance on understanding when you are deemed to be providing investment advice such that registration as an investment advisor is required, refer to The CPA’s Guide to Investment Advisory Business Models published by the AICPA. It’s also important to recognize that the statement applies whether services are delivered verbally or in writing. Note that under the statement, implementation of the

recommendations, monitoring of the client’s progress, or updating the engagement are separate engagements. You would not have an obligation for implementation, monitoring, or updating services unless you have an agreement with the client specifically to do so. If you provide these services, the statement provides additional direction.

What You Can Do to Prepare To help you understand the depth of the statement and put it into practice, the AICPA has provided essential guidance in a new publication, Standards in PFP Services: Compliance Toolkit, which includes a compliance manual, a complete copy of the Statement on Standards in Personal Financial Planning Services, a PowerPoint presentation to educate staff members, checklists for following the requirements of the statement, a flowchart explaining when the statement applies, customizable client engagement letters, and much more. To read the statement in full or for information on gaining access to the compliance toolkit, visit http://tinyurl.com/PFPstandards14. s Clark M. Blackman II, CPA/PFS, CFA, CIMA, CFP®, AIF®, is founder of Alpha Wealth Strategies in Houston, Texas, and immediate past chair of the PFP Executive Committee.

Dirk Edwards, CPA/PFS, JD, MBA, heads up Edwards Consulting, LLC, Lake Oswego, Ore., and is chair of the Responsibilities in Personal Financial Planning Services Task Force.

Nonprofit Organizations

Don't Just Talk About the Money: Financial Analysis Doesn't Tell the Full Story for Nonprofits

BY ADAM PYZDROWSKI

Donors frequently turn to rating agencies like Guidestar to help them understand how nonprofits use their dollars. These agencies typically draw on audited financial statements and IRS Form 990s to rate an organization. Prospective donors use those ratings to determine the effectiveness of a nonprofit and ultimately, whether it is worthy of support. Therein lies the problem.

Rating agencies can unintentionally misinform donors about what it means to operate an effective nonprofit because they aren’t measuring the organization’s ability to carry out its mission. The measurements rating agencies use mirror for-profit financial reporting models that have been tweaked to show the financial health of nonprofits. However, for-profit financial models were created to measure the purpose of forprofit entities: profit.

The disconnect is clear: For-profit financials reflect profits, which attract investors. Nonprofit financials fail to reflect the successes and outcomes of an organization’s programs, which is the reason to invest in it.

An organization can appear to be only marginally successful in financial terms but still have a tremendous impact on its constituents.

For instance, measuring net asset reserves and functional expenses does not indicate how successful a charity is at carrying out its programs, such as providing meaningful and beneficial mentoring programs to children. Blanket metrics also assume that all nonprofits spend funds on the same things in the same way. But a mental health facil-

ity that employs highly educated and highly paid therapists has drastically different expense breakouts than a food pantry or a homeless shelter.

Counterbalance the numbers with the successes. Nonprofits can steer the conversation so that donors understand the context behind the numbers. By telling contributors about your program successes, you give them an opportunity to become strategic investors who are connected to the big picture: carrying out your organization’s mission.

Here are four ways your organization can incorporate program impact data into your financial reporting: • Attach a cover letter to your financial statements. A cover letter could include pro-

gram data, successes, and outcomes achieved during the year, a discussion of operations through management’s lens, and future plans for the organization. Keep in mind, the cover letter is not audited, and it is not part of the financial statements.

• Add a management discussion and analysis (MD&A) section. This content could be similar to the cover letter with a few important distinctions.

It is included in the financial statements. It is considered supplementary information (unaudited), even though auditors will review it for reasonableness.

• Add programmatic measures and ratios to the footnotes. Supplement financial reporting measures with qualitative program successes, outcomes achieved during the year, and a discussion of operations from management’s perspective. Remember, this section is audited because it is included in the financial statements, so you will need to provide documentation that substantiates the information. In addition, financial ratios should report programmatic success, such as consumers served or homes built.

• Include programmatic details on the IRS Form 990. Include details from the MD&A or other sources in Schedule O so donors will see your context when they look up your Form 990 on their own. This could include notes on executive pay to help explain your investment in attracting talent to move your organization forward. s Adam Pyzdrowski is a senior associate with CliftonLarsonAllen. Contact him at adam.pyzdrowski@CLAconnect.com or 303439-6079.

July/Aug 2014 • www.cocpa.org •

9

Member Profile

Forensic Accountant Saves the Day in Whodunnit CPAs may be stereotyped as the office nerds, but that’s only because the uninformed haven’t met COCPA member Lyn Fraser, CPA. Her new mystery novel, Debits and Credits, puts a forensic accountant front and center in foiling the misdeeds, both financial and homicidal, of the prescription drug underworld. Being a CPA has never been so cool. Or so dangerous.

Life’s Plot Twists How does one end up writing a mystery novel about a forensic accountant? With a lot of plot twists, Fraser acknowledges. Indeed, her résumé isn’t exactly typical. A nontraditional accounting student, she earned her degree and passed the CPA exam on her first attempt, studying while her infant daughter napped. “I was very motivated by not wanting to study for the exam a second time,” Fraser says.

After becoming a CPA, Fraser taught at Texas A&M University for a decade and wrote a textbook, Understanding Financial Statements, which was published by Prentice Hall and sold more than 250,000 copies.

At the same time, she was producing works of short fiction. A colleague read her material and suggested she turn what she knew

10

• NewsAccount • July/Aug 2014

about business into a novel. “It sounded like an interesting combination,” Fraser says.

After 10 years in Texas, Fraser relocated to Grand Junction to teach business and professional writing at Colorado Mesa University. But her Texas colleague’s suggestion to write a novel hovered in the back of her mind. It was finally time to start writing.

Grace Edna Edge, CPA: Crime Stopper Fraser’s CPA heroine, Grace Edna Edge, doesn’t set out to solve crimes. By day, she’s a savvy forensic accountant helping her clients solve challenging financial issues. By night, she’s an aspiring romance writer to make up for the lack of romance in her own life. But when her aunt’s best friend is found dead in an Austin, Texas, library, Grace and her aunt are determined to find the killer. Grace finds herself drawn into the dark underworld of a prescription drug black market which is preying on senior citizens. “This is a real problem taken from the pages of today’s news,” Fraser explains.

For background research, she studied the issue of senior citizens, prescription drugs, and drug overdoses. She worked with a pharmacist to learn how drug interactions and overdoses occur.

Fraser also interviewed police officers who were handling prescription drug cases and read plenty of background material to make sure she was factually correct when describing the police forensic process. But even with the serious nature of the subject matter, the book isn’t all murder and intrigue. Fraser sneaks in some “quirky humor,” as her fans on Amazon describe it.

Fraser says the book’s Austin setting was a natural fit; as a native Texan, Fraser was familiar with the city, its Tex-Mex landscape, music, and culture.

Are Fraser and Grace the same person?

The book is written in the first person, so it

does make one wonder.

Fraser emphasizes that the book is fiction.

“People assume if you write in the first person it’s you talking,” she laughs. “When we write, we draw on what we know and have experienced. Certainly there is overlap to my own personal experiences.”

Getting Published Throughout the novel’s evolution, Fraser continued to teach at Mesa. “It took about four years to shape the book the way I wanted it to be and not what other people were suggesting,” she says of the process.

The next step, finding a publisher, was a tough one. Fraser eventually connected with a small, independent press in New England, Mainly Murder Press, which publishes just 10 to 12 mysteries a year. In May 2013, she submitted the first chapter, a synopsis, and her biography. Then, she settled in to wait. Fortunately, she didn’t have to wait for long. “Soon, they contacted me to say they liked it and asked for the whole manuscript,” she says.

In July 2013, the publisher sent Fraser a contract. By January 2014, the published work was in her hands. “A small press has the flexibility to move quickly,” she explains.

Since Debits and Credits was published, Fraser has been working to promote it, attending book events and signings locally and nationally. A hospice organization in Grand Junction hosted a large launch party for her, a nod to her work with the organization. A social justice nonprofit in Austin also hosted a launch party. The organization’s theme of

Tourney Supports Food For Thought social justice and the problems addressed in Fraser’s book were a natural fit. She has presented and held a book signing at a Western Slope writer’s conference and traveled to local and national bookstores for other events.

“I’m just thrilled,” Fraser says of the experience. “I have wanted to publish a novel since I was seven years old and could write. Sometimes I still can’t believe I wrote a book that combines my passions of mysteries and creative and business writing — and that someone wanted to publish it.”

While Fraser is busy promoting this book — she explains that today, authors are largely responsible for promoting their work — readers may wonder: Will we meet Grace Edna Edge, CPA, again? It may be in the cards; Fraser says she hopes to write a sequel.

Want to get caught up in the world of forensic accounting and black market prescription drug rings served up with a side of humor?

Debits and Credits is available from Colorado bookstores or amazon.com in trade paperback and e-book. Fraser welcomes your comments at lfraser@coloradomesa.edu. s

At the 2014 Young Professionals Golf Tournmant, June 9 at Lakewood Country Club, the foursome of Jeff Barnes, Jim Campbell, Lesley Fox, and Christina Kelley took first place. Jake Bakke, Sid Fahsholtz, Ken Heuer, and Doug Juelfs, pictured here, took second place. Thanks to all who played. Your genorosity netted $1300 for Food For Thought, www.foodforthoughtdenver.org.

Selling Your Practice?

Ready to Start Now? Unparalleled resources. Marketing superiority. Results beyond expectations!

We are North America’s largest marketer and seller of accounting and tax practices. That’s because we understand your business and the value of your firm, know how to market it and have thousands of buyers who are looking to acquire a practice. With our proven success system we can bring this marketing and resource advantage to your unique situation. We are different because we can deliver the best results for YOU.

Call A Practice Sales Pro Today!

Bill Anecelle, CPA, MBA (303) 670-3623 Colorado (512) 864-2864 Texas (866) 809-8705 Toll-Free Bill@AccountingPracticeSales.com

Contact us today to get the process started to sell your accounting practice.

Kate Mahrholz, Broker Support Associate (303) 524-9736 Office (512) 532-0963 Fax Kate@AccountingPracticeSales.com

We’ll work diligently to help you obtain the goal you desire.

www.AccountingPracticeSales.com

Photo by Krista Flynt

July/Aug 2014 • www.cocpa.org •

11

Valuation Services

Six Questions to Consider In Valuing a Start-up Business

BY HAYDN NEMITZ

C

olorado is home to more than its fair share of start-ups, which is attributed primarily to its environment for investment and a number of young businesses. Denver and Boulder, in particular, are considered to offer a high quality of life with access to the outdoors, education, and an urban environment that attracts and retains entrepreneurs.

One report (chart on page 13) shows that in 2013 Colorado had approximately $450 million in venture capital investment.

This amount resulted in a ranking of ninth overall in the country — a strong showing considering the state is the twenty-second most populated. Another report shows that 122 start-ups raised $461 million, with approximately 45% of the funding distributed to software companies — further evidence of new capital coming into the state.

There are, however, various issues and challenges that companies need to address as their businesses grow, such as market expansion, enriching the customer experience, evaluating consumer behavior, and creating flexible business models — all areas that are key to sustaining growth in any economic condition.

One key question to consider is, “What is the business worth?” This is particularly relevant both for strategic (e.g., access to capital, mergers, and acquisitions) and compliance (e.g., financial reporting and tax planning) purposes.

From a valuation perspective, KPMG LLP has seen that start-ups present challenges in their own right, including limited operating history, financial issues, uncertainty surrounding the feasibility of a particular technology, and industry disruption.

12

• NewsAccount • July/Aug 2014

Following are six questions to consider when preparing a valuation for a start-up company.

• What is the purpose of the valuation?

When a valuation is prepared to attract new investment, it can be “intrinsic” in nature, reflecting the upside potential. However, when a valuation is prepared for compliance purposes (i.e., financial reporting or tax planning), there are strict definitions of value in the applicable guidance. This term is commonly referred as “fair value” and does not necessarily reflect the intrinsic value perceived from the owner’s/seller’s perspective.

A valuation prepared through an intrinsic lens may not meet the requirements of fair value in a regulatory setting.

• Do you have a clear definition of what you are valuing? “The company” can be a nebulous term. That’s why it’s important to clarify if it is the equity of the company (or its various equity classes) that is being valued or equity and debt — otherwise referred to as the “enterprise value.” Be mindful of the question, “What am I actually valuing?”

• What is it worth and to whom? Many professionals involved in mergers and acquisitions work, including those at U.S. corporations and private equity and investment banks, have suggested to KPMG that valuation disparities present some of the biggest challenges in deal making. Be wary of justifying the value of a company based on your own perception of value. Your analysis should consider reasonable assumptions that most prospective buyers would consider.

• What are accepted valuation methods to be considered? A valuation should apply generally accepted valuation approaches.

Depending on the stage of the company and the industry, the income approach (i.e., discounted cash flow analysis), market approach (i.e., trading multiples of comparable companies or transactions), and the cost ap-

proach should be considered and their value indications reconciled.

Each valuation approach has its own special considerations in a start-up environment and also a number of challenges. Consider the following factors.

If using a discounted cash flow analysis, the results of the analysis are generally contingent upon the forecast. For example, how much weight would a buyer put on a forecast that showed revenues growing slowly and then quickly increasing, with little to no precedence (i.e., the “hockey stick” forecast)?

Also, what are the risk factors to consider in estimating the discount rate?

Using the market approach, a start-up company generally is lacking meaningful revenue or earnings to which a valuation multiple can be applied — and further, any valuation multiple selection process is likely to be particularly subjective. Also consider the comparability of any public companies or transactions that are being relied upon.

In the case of the cost approach, a technology start-up may believe that its balance sheet is not the most appropriate indicator of value.

• Is the value indication accurate? Accuracy (how close the valuation is to a reasonable value) and precision (how close together a group of values actually are to each other) are two important factors to consider in a valuation. Even if you consider generally accepted valuation methods, the resulting value indication may be more precise than accurate. As such, it is important to understand the value drivers so you can consider the possible metrics that best correlate to value.

Using a social media start-up as an example, you can value the company with precision by relying on a multiple of revenue — i.e. “I know the revenue, and I can observe an average revenue multiple.” However, perhaps considering the number of users would

result in a more accurate indication of value.

Overall, due consideration should be given to the quality of the accepted valuation approaches especially if the value indication is particularly subjective to a few assumptions.

• What are the risks? A number of risks should be considered with any start-up, and they can multiply depending on macroeconomic, political, and industry-specific conditions. For example, consider the healthcare industry which, according to KPMG’s 2014 M&A Outlook Survey Report, is expected to be one of the most active overall in M&A in 2014, followed by technology, telecommunications, and media.

According to healthcare executives surveyed, the industry’s response to the Affordable Care Act is the number one trend behind M&A. However, with change comes increased regulatory uncertainty. This key trend is significantly affecting deal making, according to 62% of healthcare executives who responded to the survey. Measuring and quantifying these risks is inherently subjective, with the accuracy of the value indication only improving as you are able to more clearly define the risk factors and determine the impact on the analysis.

Rank

State

Population Rank (2)

1

California

14,793.2

1

2

Massachusetts

3,102.7

14

3

New York

2,788.9

3

4

Texas

1,333.1

2

5

Washington

917.7

13

6

Maryland

635.1

19

7

Virginia

594.3

12

8

Pennsylvania

478.2

6

9

Colorado

448.2

22

10

Illinois

434.9

5

(1) 2014 MoneyTree™ Report (2) U.S. Census Bureau

The purpose of the valuation, data available, and generally accepted valuation approaches will influence the valuation approaches you consider. And while the analysis can be inherently subjective, as more assumptions are validated and supported, the reasonableness (and accuracy) of the value indication will improve.s This article represents the views of the author only and does not necessarily represent the

Summer Shamble, Sip, and Savor July 17 Cherry Hills Country Club ATTIRE AND CELL PHONE POLICIES: Gentlemen are required to wear tucked in golf shirts and golf slacks or appropriate length shorts with socks. Shorts are considered appropriate length if they are no more than 3 inches above the knee or no less than 19” long. This 19” measurement is from the top of the waistband to the bottom of the short. Short shorts, cut-offs, bib overalls, jean/ denims, sleeveless shirts, tee shirts, swim suits, etc., are not permitted. Ladies shorts or golf skirts must be of ap-

2013 Investment (1)

views or professional advice of KPMG LLP. The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax advisor.

Haydn Nemitz is a manager in KPMG LLP’s Economic & Valuation Services practice in Denver. Contact him at hnemitz@kpmg. com.

Par Three Golf and Executive Happy Hour Shamble format golf tee times start at 2 p.m.

Happy Hour runs from 5 to 7 p.m. $45/person – Golf (limited to 36 players) and Executive Happy Hour, includes two beverage tickets and appetizers $15/person – Executive Happy Hour only, includes two beverage tickets and appetizers. Walk-ins not permitted for this event.

Register online at www.cocpa.org by July 14.

Questions? Contact Leslie O’Donnell, lodonnell@cocpa.org, 303-741-8611, or 800-523-9082, ext. 111.

propriate length, as described here. Golf slacks, culottes, Bermuda length shorts, and sleeveless tops are permitted.

Halters, midriffs, or short shorts are not permitted. All players must wear non-penetrating, spikeless shoes when playing the golf course.

Cellular phones and PDAs are not permitted, except as provided in this rule. These specific devices may be used on the Club grounds for outgoing or incoming telephone calls and the retrieval of voice messages only by

the courtesy phones in the main entryway to the Club next to the Men’s and Women’s Restrooms and inside an automobile (with windows closed) in the Club parking lot. Cellular phones, PDAs, and pagers may be used for the silent receipt and transmission of emails and text messages anywhere on the Club Grounds. Cellular phones, PDAs, and personal pagers must always be set on silent or vibrate notification on the Club grounds. Devices must not ring anywhere on the Club grounds.

July/Aug 2014 • www.cocpa.org •

13

Will They Stay?

or Will They Go?

BY NATALIE ROONEY

14

• NewsAccount • July/Aug 2014

Retaining Your Best People in a Growing Economy

W

hen the recession was at its worst, organizations and their employees hunkered down to ride out the storm. Now the economy is on the upswing, but it’s a double-edged sword. With the economy improving, employees see opportunities to jump ship and change jobs. How can you make sure your best people will stick with you?

Prepared for Departure A Hay Group study released in the first quarter of 2014 contained a dire prediction: Companies will face a rising talent exodus as economic and labor market conditions improve.

According to the study, worldwide employee turnover is set to accelerate in 2014, after fairly flat levels in recent years. The number of workers changing jobs is expected to reach 161.7 million in 2014, a 12.9% increase compared to 2012. And this is only the beginning. Average employee turnover rates over the next five years are predicted to rise from 20.6 to 23.4%.

“Make no mistake: We are in the eye of a turnover storm,” the report's authors write.

“You must give serious thought to what drives employee commitment and where you need to prioritize to protect retention as job markets recover.”

Employee turnover can seriously impact a company’s bottom line. Some reports estimate the cost of replacing an employee to be as high as twelve months’ salary while others place the figure as high as 150% to 250% of salary, particularly for high-level executive vacancies. Additionally, companies experience lower productivity while a position sits vacant and while a new hire gets up to speed. Retention deserves your attention.

Changing Your Mindset Traditional methods of retention — like taking employees to lunch or telling them to leave work early occasionally — were the lazy way of doing things, says Marc Rosenberg,

CPA, president of The Rosenberg Associates in Wilmette, Ill. Rosenberg’s company produces The Rosenberg Survey, a bi-annual compilation of CPA firm statistics to help firms benchmark key financial metrics against their peers across the country.

To make matters worse, Rosenberg says CPA firms tend not to think — or act like — they’re cool. If you’re a firm working to retain your staff, you’ve got to make the organization cool. Rosenberg says working as a CPA has its negatives — primarily related to the realities of tax season. “For three and a half months I have to work sixty-plus hours a week? That’s a real turnoff,” he says. “Too many people in our profession have a misguided notion of measuring output based on hours worked instead of basing it on the quality of the work and value provided to the client. And we keep fighting this nerdy image. These negatives are all impacting turnover in the workforce and the profession.”

Rosenberg says creating an exciting workplace requires effort and thought. “You can’t just think of staff as a necessary evil. You’ve got to make your organization an exciting place for someone to work.” Rosenberg suggests reading Walter Isaacson’s biography of Steve Jobs. “Jobs made working at Apple a cool job thanks to the energy, creativity, and freedom to work a flexible schedule how and when people wanted.”

So while lunches out, afternoons off here and there, and the flexibility to coach your kid’s little league team are nice, Rosenberg says the real part — the harder part — is to be an organization that’s going places. If you’re plodding along doing the same old thing, experiencing the same growth with the same clients and the same partners, nothing is going to change. “Doing strategic planning, adding business in new fields, adding new services, merging with smaller firms, and creating more opportunities for your people,” is the way to go, Rosenberg advises.

The problem with that scenario? Partners today tend to be so busy with clients and management duties that they don’t give staff equal attention. “When you look in the

mirror in the morning, you shouldn’t just be thinking about your clients,” Rosenberg says.

“You should be asking yourself, ‘How will I make my firm great?’”

Why Good People Leave and Why They Might Stay While many organizations conduct exit interviews to find out why people leave, the answers may depend on the day.

“There are so many little things, including the fact that they’re being pursued by other companies,” says Mark Koziel, CPA, CGMA, vice president of the AICPA’s Firm Services & Global Alliances. “But what turns them from ‘not interested’ into ‘yes, I’ll talk to you’? At some point, the switch was flipped.”

Koziel says employees will say they didn’t like the hours or weren’t making enough money, but generally speaking, those are symptoms and not necessarily the source of the problem. It’s more likely there was a manager or job they didn’t like, or they felt pigeon-holed and weren’t provided with growth or training opportunities.

Continuous learning and training are important, not only to employees themselves but also to the long-term success of the organization, Koziel stresses. “It’s the age-old question: What happens when you don’t train people and they stay? That’s where we create mediocrity in our organizations.”

According to Deloitte Consulting’s Talent Edge 2020 study, 44% of employees ready to resign would stay for additional bonuses and financial incentives, 42% would like a promotion or other job advancement, and 41% would remain for a raise in base pay.

The study’s findings, broken down by demographics, indicated that bonuses and added compensation are the most influential factors in a middle-aged baby boomer’s decision whether to remain with a company. For millennials, the most influential factors are opportunities for promotion, job advancement, and additional compensation.

Staffing | Continued on 16 July/Aug 2014 • www.cocpa.org •

15

Staffing Issues

Staffing | Continued from 15 Flexible work arrangements ranked high in importance to all employees. A flexible work environment would keep 26% of those surveyed from leaving their current job and would keep 45% of older employees working beyond normal retirement, according to the study.

Retention “Strategies” to Avoid In his line of work, Rosenberg talks to a lot of CPAs. Sometimes he’s startled by what he hears, including these surefire ways to make sure you won’t retain anyone good for the long haul: No proactive programs that encourage diversity on the partner track: The CPA profession falls miserably short in numbers of women and minorities in partner positions.

“Firms don’t devise strategies for retaining women that are different from retaining men, and that’s stupid,” Rosenberg says. “You have

to communicate to female staff that you’ll work out practically any work arrangement they wish during the years they are raising a family because you value them and you will do whatever it takes to retain them during this period. Surprisingly, there is a block of people who don’t believe in that concept. If women don’t see the opportunities, you’ll lose them.”

Lack of recognition and appreciation: CPAs are trained to find out what’s wrong.

This carries over into how they deal with people, Rosenberg says. “Partners are busy and tend to have the mindset that you don’t say ‘good job’ to people who just did what they were supposed to do. But taking a little time out for the little things, like telling employees they did a good job, goes a long way.”

Who’s My Boss Syndrome: You’re a new hire, right out of school. You do Job A for Partner 1, Job B for Partner 2, and Job C for Partner 3. No one is really your boss so you don’t know where you stand. No one is

telling you what you need to do to advance.

“That’s what mentoring is about,” Rosenberg says. “Someone should be charged with making you successful at the firm. If organizations don’t do any mentoring and don’t provide feedback, it’s the kiss of death.”

Don’t Talk To Staff about Becoming a Partner: “Partners tell me that young people today don’t want to become tomorrow’s partners,” Rosenberg says. “It’s a myth.” What’s really happening is that no one has made a point of talking to these young people about becoming a partner one day. Staff need to know what they need to do to advance, and ultimately, how much money they can make.

“Tell them what a great job it is to be a partner in a great CPA firm, including how much money they can earn. Sell it!” Rosenberg encourages.

Treat Staff Like Outsiders: Rosenberg says he hears firsthand from young CPAs that their favorite part of work isn’t the money or the title but rather the fun they have with

The AICPA developed the following Work/Life Retention Action Plan to help CPA firms understand their talent pool, gather feedback, follow up on ideas, develop benefits, and evaluate the success of plans which have been implemented.

Action

Result

PCPS Tool

Product Champion

Understand the talent pool

Allows firms to better relate to today’s team members and gain a strategic advantage in attracting and retaining top performers

PCPS Top Talent Study - A Decade of Changes in the Accounting Profession: Workforce Trends and Human Capital Practices (2004 Survey) What Women in the Profession are Thinking

[Managing Partner]

Gather feedback from your team members both formally and informally

Gives employees a voice and gives firms valuable insight into team member desires and issues

Use survey tools in the PCPS Top Talent Study above and in the Orientation and Performance Management sections

[Executive Team, including Partners, Directors, and Managers]

Follow-up on team member ideas and requests by taking action and communicating with your team

Shows team members that the firm has their best interests at heart and allows the firm to improve its staffing programs

Staff Retention Video

[Executive Team]

Offer great tangible benefits

Gives firms the opportunity to be competitive for current and future talent

Outrageous Employee Benefits Sample Maternity Leave Policy (and more to come in the Reward & Compensation section)

[Managing Partner/ Administrator]

Offer great intangible benefits, such as flexible work arrangements and alternate career paths

Allows firms to be unique and adapt to their employees and market, which will result in a better value proposition

Telecommuting Assessment and Evaluation Kit Employee Retention Guide Managing Flexible Work Arrangements

[Managing Partner/ Administrator]

Implement the Performance Management program and encourage mentoring

Promotes regular performance feedback and encourages people to serve as role models

Implementing the Performance Management System Mentoring Guidelines

[Performance Management Champion]

Provide leadership and development opportunities, especially for women

Adequately trains future leaders to be ready when needed and encourages women to remain in the profession

Guide to Building a Successful Off-Ramping Program (more to come in the Training & Learning section)

[Managing Partner/ Administrator]

Reevaluate all benefits and team member opportunities on a regular basis

Ensures the firm’s staffing programs stay up-to-date, fresh, and appealing to current and future team members

16

• NewsAccount • July/Aug 2014

[Executive Team]

Deadline

Completed

their peers. Foster that feeling of belonging.

“Don’t just talk about your organization feeling like family; do it,” he says.

Rosenberg encourages organizations to engage staff by: • Offering flexibility. Let people do their work when they want to do it. Worry about whether the job was done and if clients felt they received great service instead of whether someone sat at a desk during certain hours to complete a project.

• Seeking the staff’s feedback. Make a conscious effort, even if it’s an informal one, to hear what young people have to say and implement their ideas. “You can’t get too much feedback,” Rosenberg says.

Retention as a Culture Not a Benefit Your goal, says Koziel, is to make retention a cultural norm, not a benefit. “Accounting isn’t the profession it was years ago,” he

says. “Retention needs to run much deeper and become ingrained in the very fabric of your organization.”

One of the big changes Koziel has seen over the years: People never used to leave a CPA firm during tax season. “But now, it happens,” he says, adding that the issue has been talked about at the national level. “We think part of the issue is that young CPAs feel they’re going to a job rather than belonging to a profession. It’s not a calling for them. How do we help them feel they’re part of something bigger?”

Koziel offers the following steps for creating a culture of retention at your organization: Step One: Create a culture team. “Listen carefully to what employees have to say, and then drive change,” Koziel advises. If someone has a good idea and you don’t do it, there will be a negative effect. Place employees from multiple levels on the team when you’re gathering ideas. Then act on what you learn.

Step Two: Train your people. Make them feel part of the team from day one. If you treat them like outsiders, “they will absolutely leave,” Koziel says.

Step Three: Improve hiring processes.

Find people who have a better chance of success in the organization. Define what a successful candidate looks like, and search only for those people.

Koziel says the ultimate litmus test is asking yourself if your organization is a place that would be good enough for your own kid to work. “Because I’m hiring someone else’s kid,” he says. “I have to look someone in the face and say it’s the right opportunity for them.”

Be the type of organization where you’d want your own child to enjoy working every day.

Retention is an ongoing and evolutionary process, Koziel says. And it all comes back to culture and creating a work environment where employees want to stay. “We have different tools to help us, but culture is what it’s all about.” s

Two Colorado Employers' Perspectives on Employee Retention Reese Henry & Company, Inc., Certified Public Accountants, Aspen Businesses in mountain towns face unique challenges, but that doesn’t mean retaining talent is impossible, says COCPA Board of Directors member Kelly Boggs, CPA. However, you do have to be very mindful of your efforts. “As a firm, you must provide clear and meaningful opportunities for career growth,” he says. “Otherwise, rising young stars in your firm will be pursuing their careers somewhere else.”

Boggs’ firm focuses on two objectives: offering challenging, high-quality, and rewarding work in a progressive team environment; and leveraging the firm’s locations, Aspen and Carbondale, to emphasize a unique work/life balance rooted in the towns’ culture. “We offer flex time, health benefits, and a sabbatical program to our employees.”

Boggs says this mix aids in retention, especially with the firm’s senior-level professionals. “But there’s no substitute for providing opportunities for career growth, an area we continue to focus more attention on,” he says.

The profession’s young CPAs can be particularly hard to retain, Boggs says. “Even as I reflect on my own career, this makes sense. If you’re young, ambitious, and unsettled, you’re likely to make a few changes along the way as you search for opportunities to develop your career,” he says. “It’s important to maintain your focus on engaging and listening to your employees.”

Charter School Growth Fund, Broomfield COCPA member Tawnya Ramirez, CPA, CGMA, Controller for the Charter School Growth Fund (CSGF), says that while the organization isn’t currently experiencing difficulty retaining staff, management recently undertook a culture survey to get a better sense of what employees were feeling and experiencing. The survey was part of a larger, continuing conversation among the staff and management. “While it affirmed the positive experiences that most of us have every day, it also provided clarity on what we could do as an organization and as individuals to improve our culture,” Ramirez says.

An important component of the CSGF’s culture is allowing employees to control and have ownership over their work. “We can work remotely. We’re accountable for results, not sitting in a seat,” Ramirez says, adding that the organization actively seeks people who have a passion for what it does. “We support organizations that educate kids in grades K-12, so it’s hard not to get jazzed about that,” Ramirez says. CSGF faces the same struggles many organizations do in recruiting and hiring. “We’re a nonprofit and are competing with the for-profit sector for talent,” Ramirez acknowledges. “We convince good people to come into the fold and then focus on benefits and a culture that rewards entrepreneurialism.”

Above all, Ramirez says it’s critical to give employees a chance to tell you what they need and then really listen. “It’s about building trust,” she says. “They have to be vulnerable with you, and you have to be vulnerable with them to gain shared learning. It’s well worth the investment. If you listen, they’ll tell you.”s July/Aug 2014 • www.cocpa.org •

17

Legislative Update

What's New: 2014 Colorado Tax Laws

BY MARK KOZIK, JD, CPA, LLM AND BRUCE NELSON, MA, CPA

The Colorado General Assembly convened on Jan. 8, 2014, and ended on May 7, 2014. During the statutorily mandated 120-day session, legislators introduced 613 bills including several bills specifically addressing state and local taxes. Following is a select summary of key legislation affecting Colorado taxpayers.

Administration and Procedure HB 14-1107 — Electronic Tax Notices: The Colorado Department of Revenue

currently uses first-class and certified firstclass mail to deliver taxpayer notices. This bill authorizes the Department to issue regulations to establish procedures by which a taxpayer can voluntarily elect to receive any notice or other communication by electronic means. C.R.S §39-21-105.5(2).

HB 14-1348 — Definition of a Retail Sale: C.R.S. §39-102(9) defines the

term “retail sale” as it will apply if/when Congress enacts the Marketplace Fairness Act expanding the ability of states to require certain out-of-state sellers (“remote sellers”) to collect and remit sales tax on sales to in-state customers. Prior to amendment, this new definition would have taken effect, July 1, 2014. Because Congress has not yet passed the Marketplace Fairness Act (or similar legislation), this bill defers implementation of the definition of “retail sale” to the later of the effective date of HB 14-1348 (May 31, 2014) or the effective date of legislation passed by Congress. If/ when the new definition becomes applicable, more purchases will be sourced by reference to the purchaser’s location than under the current definition.

18

• NewsAccount • July/Aug 2014

SB 14-183 — Business Incentive Agreement Term: Under current law, lo-

cal governments, including counties, municipalities, and special districts, may negotiate an incentive payment or property tax credit with taxpayers that pay business personal property tax and establish a new business facility, expand an existing facility, or are considering relocating an existing facility out of state. These payments or credits are included in agreements commonly known as business incentive agreements (BIAs). This bill extends the existing 10-year statutory limit on the term of a BIA to 35 years.

Income Tax HB 14-1003 — Nonresident Disaster Emergency Workers: Applicable to

income tax years commencing on or after Jan. 1, 2015, new C.R.S. §39-22-104(1)(t) (I) provides a subtracting modification from a nonresident’s federal taxable income for compensation that would otherwise be subject to withholding under C.R.S. 39-22-604 that is received for performing disaster-related work in the state during a disaster period.

To qualify for this modification, the in-state work must be “disaster-related work,” relate to a “declared state disaster emergency,” and be during the “disaster period.” See, C.R.S. §39-22-104(1)(t)(II) for definitions of these terms. If this is the only Colorado-source income of a nonresident, the taxpayer is not required to file a Colorado income tax return. C.R.S. §39-22-604(1)(a)(II).

HB 14-1012 — Advanced Industry Investment Income Tax Credit: This bill

repeals the Colorado Innovation Investment Income Tax Credit (CIITC) and replaces it

with the Advanced Industry Investment Income Tax Credit (AIIITC). The AIIITC income tax credit is available in tax years 2014 through 2017 to “qualified investors” for “qualified investments” made in a “qualified small business.”

A “qualified investor” is an individual, limited liability company, partnership, S corporation, or other business entity, not including C corporations, that makes a qualified investment in a qualified small business.

C.R.S. § 24-48.5-112(1)(f ).

A “qualified investment” is an investment made on or after July 1, 2014 and before Jan. 1, 2018 in an equity security that meets all of the following requirements: • The security is a common stock, preferred stock, partnership, or limited liability company interest; is a security that is convertible into such interest; is a convertible debt investment; or other equity security designated by the Colorado Office of Economic Development. C.R.S. § 24-48.5112(1)(e)(I).

• The investment is $10,000 or more.

C.R.S. § 24-48.5-112(1)(e)(II).

• The qualified investor and certain related parties own 30% or less of the voting power of all equity securities in a qualified small business immediately before the investment. C.R.S. § 24-48.5-112(1)(e)(III).

• The qualified investor and certain related parties own less than 50% of the voting power of all equity securities in a qualified small business immediately after the investment. C.R.S. § 24-48.5-112(1)(e)(IV).

A “qualified small business” is a corporation, limited liability company, partnership, or other business entity that meets all of the following requirements:

• Is in an “advanced industry” (advanced manufacturing, aerospace, bioscience, electronics, energy and natural resources, infrastructure engineering, and information technology). C.R.S. §§ 24-48.5-112(1)(g)(I); 24-48.5-112(1)(a); 24-48.5-117(2)(a).

• Has its headquarters in Colorado or has 50% or more of its employees based in Colorado. C.R.S. § 24-48.5-112(1)(g)(II).

• Has received less than $10 million from third-party investors (not including grants) since the business was formed. C.R.S. § 2448.5-112(1)(g)(III).

• Has operating revenues of less than $5 million dollars. C.R.S. § 24-48.5-112(1)(g) (IV).

• Has been actively operating and generating revenue for less than five years. C.R.S. § 24-48.5-112(1)(g)(V).

C.R.S. §24-48.5-112(2) sets out rules for certifying qualified small businesses, establishing eligibility of investors, the required applications, and the review process for credits. Note that applications must generally be filed with the Colorado Office of Economic Development within 90 days after a qualified investment is made. As part of the application, the applicant must state that the credit was a “significant factor in the applicant’s decision to make the investment and that without the tax credit, the applicant would not have made the investment or would have made an investment at a substantially lower level.”

C.R.S. §24-48.5-112(3) sets out the process for certification of the credit. In general, the amount of the credit is 25% of the qualified investment (30% if the investee is located in a rural area or economically distressed area as determined by the Colorado Office of Economic Development). The credit is nontransferable. C.R.S. §24-48.5-112(3).

It is also nonrefundable, but it can be carried forward up to five years. C.R.S. §39-22532(4).

For calendar 2014, the aggregate credits taken by all taxpayers is capped at $375,000.

For 2015-2017, each, the aggregate cap is $750,000. Credits are authorized to taxpayers based on the order in which the applications are received.

A taxpayer is limited to $50,000 in credit for each qualified investment, with only one

credit per qualified small business (but can potentially take multiple credits in a year for multiple qualified investments). Taxpayers claiming the credit are required to make certain disclosures with the Department of Revenue, within prescribed timeframes, or lose the credit. See, C.R.S. §24-48.5-112(3) for additional information.

HB 14-1014 — Job Growth Incentive Tax Credit: C.R.S. §39-22-531 pro-

vides a potential income tax credit to firms that create jobs in Colorado. See, C.R.S. §39-22-531(2). The credit is allowed at the discretion of the Colorado Economic Development Commission. See, C.R.S. §39-22531(2).

Approval by the Commission is subject to the project resulting in at least 20 new jobs (potentially less if the project is located in a designated enhanced rural enterprise zone) during the credit period; the new jobs must pay a wage in excess of 110% of the average yearly wage for the county in which the taxpayer is located; the new employees must be retained for at least one year; and the taxpayer must show that it would not have undertaken the project in Colorado but for this credit. See, C.R.S. §39-22-531(3) (a). The taxpayer must submit a written application for this credit. See, C.R.S. §39-22531(3)(b).

The maximum credit available to the taxpayer is 50% of the taxpayer’s total estimated employer share of FICA tax attributable to new employees of the project. In general, the taxpayer receives this credit each year the job is retained for up to 60 months after the credit is first received. See, C.R.S. §39-22531(1)(d).

This bill amends the credit for income tax years beginning on or after Jan. 1, 2014 in the following ways: • The credit period is extended from 60 months to 96 months. See, C.R.S. §39-22531(1)(d)(II).

• The required wage threshold is decreased from 110% of the county average to 100% of the county average (applicable also to projects in a designated enhanced rural enterprise zone). See, C.R.S. §§39-22531(3)(a)(I)(A) and (B).

• Instead of showing that the project would not occur but for the credit, the tax-

payer must show that the credit was a “major factor in the decision to locate or retain the project in Colorado.” See, C.R.S. §§39-22531(3)(a)(II) and -3(b) regarding “major factor” requirements.

HB 14-1072 — Child Care Expenses Tax Credit: Adds new C.R.S. §39-22-

119.5 which creates a new child care credit for Colorado income tax purposes. The credit is available to resident individuals if: • The individual has adjusted gross income of $25,000 or less; • The individual has insufficient tax liability to claim the child care credit under C.R.S. §39-22-119; • The child care expenses are for the care of a dependent child who is younger than 13 years old; and • The individual would be allowed a federal income tax child care credit under IRC §21 if he/she has sufficient tax liability.

C.R.S. §39-22-119.5(3)(a).

The amount of the credit is equal to 25% of the individual’s child care expenses, with the credit limited to $500 for a single dependent and $1,000 for two or more dependents. C.R.S. §39-22-119.5(3)(b). The amount of child care expenses considered cannot exceed the individual’s earned income (or, if two individuals file a joint return, the lesser of either’s earned income).

C.R.S. §39-22-119.5(4). If the credit exceeds the Colorado income tax liability, the excess is refundable. C.R.S. §39-22-119.5(3) (c). In the case of a part-year resident, the credit is apportioned as provided in C.R.S. §39-22-110(1). C.R.S. §39-22-119.5(6).

See, C.R.S. §39-22-119.5(5) for additional information on required disclosures regarding the child care service provider and the dependent child.

HB 14-1119 — Credit for Food Contributed to Hunger-Relief Charitable Organizations: Beginning on or after Jan.

1, 2015 through 2019, new C.R.S. §39-22536 provides an income tax credit for qualified contributions of food to hunger-relief charitable organizations. The credit is equal to 25% of the defined wholesale market price or 25% of the most recent sale price (also defined) of the food contribution,

Tax | Continued on 20 July/Aug 2014 • www.cocpa.org •

19

Legislative Update

Tax | Continued from 19

HB 14-1163 — Clarify Enterprise Zone Investment Tax Credit Cap: Tax-

with a maximum credit of $5,000. C.R.S. §39-22-536(2)(a).

For purposes of this credit qualifying food includes livestock/certain big game, eggs, milk, or an agricultural crop, including but not limited to grains, fruits, and vegetables. C.R.S. §39-22-536(1)(b). Taxpayers qualified to take this credit include resident individuals and domestic or foreign corporations subject to Colorado income tax and that file a Schedule F (Profit or Loss from Farming) with their federal income tax returns. C.R.S. §39-22-536(1)(e). The taxpayer must receive a credit certificate from the charitable organization. C.R.S. §39-22536(2)(a). See, C.R.S. §39-22-536(2)(b) for additional information regarding the certificate. The taxpayer must include the certificate with its Colorado income tax return.

C.R.S. §39-22-536(3)(b)(II).

If the amount of the credit exceeds the taxpayer’s Colorado income tax liability for the year of the contribution, the excess is carried forward up to five years. There is no refund for unused credits. C.R.S. §39-22536(3). No credit is allowed if the taxpayer takes a deduction under C.R.S. §39-22104(4)(m) for the food contribution. C.R.S. §39-22-536(4)(a). Corporate taxpayers cannot take this credit if they take the credit under C.R.S. §39-22-301(3) for crop or livestock contributions. C.R.S. §39-22-536(4) (b).

If the underlying food contribution is reflected in the taxpayer’s I.R.C. §170 charitable contribution deduction, that deduction amount must be added back in computed Colorado taxable income. (Otherwise, there would be a double benefit if the contribution were taken into account in computing federal and Colorado taxable income, and the taxpayer took a Colorado income tax credit for that same contribution.) C.R.S. §39-22104(3)(j). Similarly, if the taxpayer takes the standard deduction for federal income tax purposes, the potential Colorado deduction available for charitable contributions is not available if the taxpayer claims the Colorado income tax credit on the underlying contribution. C.R.S. §39-22-104(4)(m)(VII).

payers who make a qualified investment within an enterprise zone may claim an income tax credit equal to 3% of the value of the investment. The credit must be precertified by the Economic Development Commission prior to the investment. This bill clarifies that the tax credit that a taxpayer may claim in any year, beginning with 2014, is limited to $750,000. Any credits earned over that amount may be carried forward for 14 years.

20

• NewsAccount • July/Aug 2014

HB 14-1311 — Tax Credit for Qualified Costs Incurred in Preservation of Historic Structures: C.R.S. §39-22-514

generally provides an income tax credit for historic preservation projects. The credit is equal to 20% of qualifying rehabilitation costs incurred by the owner or qualified tenant, with a maximum credit of $50,000 per qualified property. The underlying property must be designated as a landmark or contributing property, and it must be at least 50 years old. This credit is contingent on revenue forecasts showing General Fund appropriations can grow by 6% (with the Department of Revenue indicating the availability status for given income tax years). This credit is available for income tax years beginning on or after Jan. 1, 1991 but before Jan. 1, 2020. See, C.R.S. §39-22-514 for additional details.

C.R.S. §39-22-514.5 provides an income tax credit for property owners for qualified costs incurred in the preservation of historic structures in tax years beginning on or after Jan. 1, 2016 but before Jan. 1, 2020. The credit is based on qualified expenditures.

C.R.S. §39-22-514.5(3).

This credit is potentially available for both qualified commercial and qualified residential properties. A qualified commercial property is generally a property that carries the required certification from the Historical Society of Colorado. C.R.S. §3922-514.5(2)(j). A qualified residential property is generally a property that is located in Colorado, owner-occupied, at least 50 years old, and carries the appropriate listing or designation. C.R.S. §39-22-514.5(2)(l).

To support a credit, the qualified rehabilitation expenditures must exceed 25% of

the owner’s original purchase price for commercial structures (not including the portion of the price attributed to land). C.R.S. §3922-514.5(2)(p)(I) and exceed $5,000 for residential structures. C.R.S. §39-22-514.5(2) (p)(II).

Qualified rehabilitation expenditures for commercial structures are generally defined by reference to I.R.C. §47. C.R.S. §39-22514.5(2)(k)(I). Qualified rehabilitation expenditures for residential structures are defined in C.R.S. §39-22-514.5(2)(k)(II).

For commercial structures, the amount of the credit is equal to 25% of up to $2,000,000 in qualified cost; plus 20% of qualified costs in excess of $2,000,000.

C.R.S. §39-22-514.5(8)(b). For each commercial structure, the credit is capped at $1,000,000 per calendar year. C.R.S. §3922-514.5(2)(j). An increased credit is available for structures located in designated disaster areas. C.R.S. §39-22-514.5(8)(c). The credit is claimed in the tax year in which the certified rehabilitation is placed in service.

C.R.S. §39-22-514.5(11). A credit in excess of that amount is not refundable, but it can be transferred or carried forward up to 10 years. C.R.S. §39-22-514.5(11) and (12)(d).

For residential structures, the amount of the credit is equal to 20% of qualified costs.

The credit is capped at $50,000 over a 10year period commencing with each change in ownership of the residential structure.

C.R.S. §39-22-514.5(8)(e). An increased credit is available for structures located in designated disaster areas. C.R.S. §39-22514.5(8)(e). The credit is claimed in the tax year in which the certified rehabilitation is placed in service. C.R.S. §39-22-514.5(11).

A credit in excess of that amount is not refundable, can be carried forward up to 10 years, C.R.S. §39-22-514.5(11), but there is no provision for the transfer of a credit related to a residential structure. C.R.S. §3922-514.5(12)(d).

For purposes of this credit, certain lessees are treated as owners. See, C.R.S. §39-22514.5(2)(i).

There are extensive application, approval, reporting, disclosure requirements, and procedures related to this credit. See, C.R.S. §39-22-514.5. There are also aggregate

limits imposed on the credit. See, C.R.S. §39-22-514.5(12).

SB 14-019 — Filing Status for Civil Unions: Partners in a civil union must now

file, as all other Colorado taxpayers, on the same basis as they file for federal income tax. Thus, partners in a civil union who determine their federal taxable income on a separate basis must do likewise for Colorado income tax purposes. Such partners who determine their federal taxable income on a joint basis must do so for Colorado income tax purposes. C.R.S. §14-15-117.

The change is applicable to tax years beginning on or after Jan. 1, 2013, and any other income tax year open under C.R.S. §39-21107 (Limitations) or C.R.S. §39-21-108 (Refunds).

SB 14-073 — Environmental Remediation Credit: For income tax years be-

ginning on or after Jan. 1, 2014 but before Jan. 1, 2023, C.R.S. §39-22-526 allows an income tax credit for “approved environmental remediation of contaminated property by any taxpayer” who meets the following requirements: The subject property must be located in Colorado, and the taxpayer seeking the credit must possess the required documentation issued by the Department of Public Health and Environment. See, C.R.S. §39-22-526(1)(a).

The amount of the credit is limited to 40% of the first $750,000 expended for approved remediation; 30% of the second $750,000 expended for approved remediation; 0% of any expenditures in excess of $1,500,000. See, C.R.S. §39-22-526(1)(b).

This credit is applied to taxes due, or it can be transferred (in whole or part) to another taxpayer for that taxpayer to apply against its Colorado income tax. If the credit allowed exceeds the tax due, the excess is carried forward up to five years. C.R.S. §§3922-526(1)(c) and (d).

Only $3 million in tax credits is available each year.

Property Tax HB 14-1001 — Property Tax Reimbursement for Property Destroyed by Natural Causes: C.R.S. §39-1-123, as

added, provides procedures for state reimbursement to counties for lost property tax revenues due to the post-assessment-date destruction of real property and business personal property (if the business personal property were reported on a single schedule).

The reimbursement applies for the property tax year in which the natural cause occurred.

C.R.S. §39-1-123(a)(1).Within 30 calendar days of receipt of the reimbursement moneys from the state treasurer, the county treasurer is required to either apply a credit to the tax bill of the destroyed property or pay the property tax owed for each destroyed property. If the property tax due for the destroyed property has already been paid, the county treasurer is required to issue a reimbursement to the affected taxpayer.

HB 14-1074 — “Reasonable Expenses” for Charitable, Religious, and Educational Purposes: Currently, C.R.S.

§39-3-116(2)(c) provides that the amount received by the owner of property for use of the property by others for certain charitable or nonprofit purposes generally cannot exceed one dollar per year plus an equitable portion of the reasonable expenses incurred in the operation and maintenance of the property. For this purpose, reasonable expenses include interest expenses but not any amount expended to reduce debt.

As amended by HB 14-1074, C.R.S. §39-3-116(2)(c) expands the scope of reasonable expenses to include interest expense (but not amounts expended to reduce debt), depreciation, long-term maintenance expenses allowed under GAAP, capital expenses dedicated to refurbishing the property, and expenses incurred to allow the property to conserve energy, water, or other natural resources. Applicable to property tax years beginning on or after Jan. 1, 2014.

HB 14-1101 — Community Solar Gardens: This bill adds C.R.S. §39-3-

118.7, which provides a partial personal property tax exemption for “Community Solar Gardens.” The exemption applies to the “percentage of alternating current electricity capacity of a community solar garden that is attributed to residential or governmental subscribers or to subscribers that are organizations that have been granted property tax

exemptions pursuant to sections 39-3-106 to 39-3-113.5.”

The term “Community Solar Garden” refers to certain solar electric generation facilities with ratings of two megawatts or less, located in or near a community served by a qualifying retail utility, where use of the electricity generated by the facility belongs to the subscribers to the community solar garden. See, C.R.S. §40-2-127(2)(b)(I)(A) for additional information regarding community solar gardens. See, C.R.S §40-2-127(2) (b)(II) for the definition of “subscriber.”

HB 14-1349 — “Not for Private Gain or Corporate Profit”: C.R.S. §§ 39-3-101

to 137 contain numerous exemptions from property tax for real and/or personal property.

Many of the exemptions are based on the requirement that the property be owned and used solely and exclusively for charitable purposes and “not for private gain or corporate profit.” Prior to amendment, this phrase meant that the ownership and use of the subject property was such that no person with any connection to the owner of the property receive any pecuniary benefit (other than reasonable compensation for services rendered) and that any excess income over expenses from the operation or use of the property (including proceeds from the sale of the property) were devoted to furthering any exempt purpose. See, C.R.S. 391-102(8.5). Property ownership was deemed to have met these requirements if either of the following were met: • The property was owned by a nonprofit corporation or association and irrevocably dedicated to charitable, religious, or school purposes, and no portion of the owner’s assets inured to the benefit of any private person upon the liquidation, dissolution, or abandonment of the corporation or association. C.R.S. §39-1-102(8.5)(a).

• The operator of the property was a nonprofit entity that would otherwise qualify for property tax exemption under C.R.S. §39-3 (C.R.S. §39-3-101 to 208); the operator was a general partner or member of the owner; and the property was owned by: * An entity organized to obtain (and is eligible for) federal tax credits through the

Tax | Continued on 22 July/Aug 2014 • www.cocpa.org •

21

Legislative Update

Tax | Continued from 21

Sales and Use Tax

new markets tax credit program or the rehabilitation tax credit program; and * An entity that makes payments in lieu of property taxes pursuant to C.R.S. §393-114.5. C.R.S. §39-1-102(8.5)(b).

As amended, the specific property ownership requirements listed in C.R.S. §39-1-102(8.5)(b) are repealed. Effective for property tax years beginning on or after Jan. 1, 2014, C.R.S. §39-3127.5 is added, exempting real and personal property from property tax if the property is owned by a “qualified business entity,” and the property is used for the purposes described in C.R.S. §§393-106 to 113.5 and §39-3-116.

For this purpose, a “qualified business entity” means a limited partnership or limited liability company that is formed for the purpose of obtaining (and obtains) federal tax credits, and the general partner or managing member of which is an entity that would qualify for property tax exemption under C.R.S. §§39-3-106 to 113.5. C.R.S. §39-3127.5(1)(a).

Under existing Colorado Department of Revenue practice, sales meeting the following requirements are exempt from Colorado sales tax: The sale is made on a reservation, and the sale is to an enrolled tribal member who lives on the reservation. Also, sales of motor vehicles to enrolled tribal members, which vehicles will be registered to an address on the reservation, are exempt.

As amended, new C.R.S. §39-26-727 codifies the existing exemptions. C.R.S. §39-26-727(2) states that “reservation” means the Southern Ute Indian Reservation or the Reservation of the Mountain Ute Tribe. C.R.S. §39-26-727(3)(a) states that the exemption applies to sales to either tribe or to an enrolled member of either tribe, and that it applies to sales made on a reservation; sales made outside a reservation but where the vendor delivers the subject matter to the tribe or member on the reservation; and sales of motor vehicles to a tribe or to a member who resides on the reservation, which vehicle is to be registered to an address on the reservation. This exemption generally carries over to the use tax. See, C.R.S. §39-26-727(4).

These exemptions potentially carry over to purchases by entities where a tribe or member has an ownership interest in the entity.

See, C.R.S. §39-26-727(5).

SB 14-014 — Property Tax, Rent, Heat, or Fuel (PTC) Credit: The

property tax, rent, heat, or fuel rebate program (PTC rebate program) provides property tax and rent assistance through rebates to Colorado residents over age 65, surviving spouses over age 58, and individuals with disabilities. The rebate is based on the real property tax (or, in certain cases, the rent) paid by the taxpayer and is subject to ceilings based on income. See, C.R.S. §§39-31-101(2) and (4). For income tax years beginning on or after Jan. 1, 2014, the calculation of the property tax rebate is changed from a maximum of $600 to $700. C.R.S. §§39-31-101(2)(a)(III) and (2)(a.5).

SB 14-080 — Property Tax Appeals: This bill broadens the number of

individuals who can qualify as arbitrators to hear appeals. Formerly, only licensed attorneys, appraisers, real estate brokers, retired judges, and former county assessors could serve as arbitrators.

22

• NewsAccount • July/Aug 2014

HB 14-1080 — Tribal Exemption:

HB 14-1159 — Biogas System Components Sales and Use Tax Exemption: This bill creates a new sales tax

exemption at C.R.S. §39-26-724(1)(c)(I), which exempts from state-level sales/use tax “components used in biogas production systems” for the production of biogas for sale to a power generator, as a transportation fuel, or as renewable natural gas. “Components used in biogas production systems” is defined in CRS §39-26-724(2). State-administered jurisdictions (counties and statutory cities) can electively add this exemption. C.R.S. §§292-105(1)(d)(I)(N) and 29-2-109(1.5)(a).

HB 14-1178 — Sales and Use Tax Exemption for Space Flight Property:

New C.R.S. §39-26-728 provides a sales/use tax exemption for “qualified property for use in space flight.” C.R.S. §39-26-728(1). For this purpose, “qualified property for use in

space flight” means a space vehicle and any component thereof; tangible personal property placed or used aboard a space vehicle; and certain fuel. C.R.S. §39-26-728(2)(a).

Definitions are provided for “space flight” and “space vehicle.” C.R.S. §39-26-728(2) (b) and (c). Also, the exemption is not lost if there is a failure, postponement, destruction, or cancellation of a launch of a space vehicle.

C.R.S. §39-26-728(3). State-administered jurisdictions (counties and statutory cities) can electively add this exemption. C.R.S. §29-2-105(1)(d)(I)(M).

HB 14-1269 — Marketplace Fairness and Small Business Protection:

The C.R.S. §39-26-102(3) definition of “doing business in [Colorado]” is amended to expressly include: • Selling, leasing, or delivering taxable services in Colorado • Maintenance of a storage place in Colorado (C.R.S. §39-26-102(3)(a)) • Employment of a Colorado resident who works from a Colorado home office (C.R.S. §39-26-102(3)(a)) • A “remote seller” doing business in Colorado with respect to any “remote sale” that is subject to Colorado state-level sales tax under C.R.S. §39-26-104(2), which is the provision that would impose Colorado state and local sales tax collection obligations on remote sellers upon Congress’ enactment of legislation currently proposed under the name “Marketplace Fairness Act” • Remote members of certain controlled groups. Under this rule, if a member of a “controlled group” has physical presence in Colorado, then any member of that group that does not have Colorado sales tax nexus on its own (a remote member) is presumed to have such nexus (unless the member with in-state physical presence is a common carrier acting as such) if the group member with physical presence: * Sells tangible personal property or taxable services with the same or similar name as that sold by the remote seller in question (C.R.S. §39-26-102(3)(d) (I)(A)). * Maintains an office or other physical facility in Colorado to facilitate the delivery of tangible personal property or

taxable services sold to Colorado customers by the remote seller in question (C.R.S. §39-26-102(3)(d)(I)(B)). * Uses trademarks, service marks, or trade names in Colorado that are “the same or substantially similar” to those used by the remote seller in question (C.R.S. §39-26-102(3)(d)(I)(C)). * Delivers, installs, assembles, or performs maintenance or repair services on tangible personal property in Colorado that was sold to Colorado customers by the remote seller in question (C.R.S. §3926-102(3)(d)(I)(D)). * Allows Colorado customers of the remote seller to pick up at a Colorado location tangible personal property sold by the remote seller (C.R.S. §39-26102(3)(d)(I)(E)).

This presumption can be rebutted “by proof that, during the calendar year in question” the member with physical presence in Colorado did not “engage in any activities in [Colorado] that are sufficient under United States Constitutional standards to establish nexus in [Colorado] on behalf ” of the remote seller. (C.R.S. §39-26-102(3)(d)(III)).

For purposes of the remote seller rules, “controlled group” and “component member” are defined the same as in I.R.C. §1563.

Also, non-corporate entities can be treated as component members if they meet the I.R.C. §1563 ownership requirements.

Under C.R.S. §39-26-102(3)(e)(I) and (II), as amended, a similar presumption applies to a remote seller if it enters into an agreement with a party that has in-state physical presence, and the in-state party undertakes any of the activities listed above, other than in-state use of the remote seller’s intangible property, in Colorado. Here, there is no requirement that the remote seller and in-state party be members of the same controlled group. Also, this presumption does not apply if the remote seller purchases advertisements to be delivered in Colorado on television, radio, newspapers, magazines, the internet, or any other mass-marketing medium. C.R.S. §39-26-102(3)(e)(III)(A). It also does not apply if the in-state party is an “independent contractor or other representative” that directly or indirectly refers poten-

tial customers through internet promotional methods to the remote seller. C.R.S. §39-26102(3)(e)(III)(B). Payment by the remote seller to the in-state party of a cost per action, including for completed sales, does not change this result. C.R.S. §39-26-102(3)(e) (III)(B). In other words, Colorado does not adopt click-through nexus. Finally, this presumption does not apply if the remote seller’s Colorado sales during the prior calendar are less than $50,000. C.R.S. §39-26-102(3) (e)(III)(C).

HB 14-1279 — Income Tax Credit for Business Personal Property: Under

current law, the first $7,000 of business personal property is exempt from property tax.

Beginning Jan. 1, 2015, the first $15,000 will be exempt from property tax. This bill creates a state income tax credit equal to the amount of business personal property tax paid, less the value of the tax benefit received by the taxpayer from deducting business personal property taxes from his or her federal taxable income. According to the Colorado Department of Revenue, this is accomplished by multiplying the amount of business personal property tax paid times 100%, less the taxpayer’s federal marginal income tax rate after subtracting the state’s income tax rate of 4.63%. The tax credit is refundable, but to claim the credit, the taxpayer must submit a copy of his/her relevant property tax statement to the Department of Revenue.

HB 14-1311 — Job Creation and Main Street Revitalization Act: This bill

creates an income tax credit for a property owner that completes a qualified rehabilitation project on a historical property. The credit will be available for tax years 2016 through 2019. Under the bill, the Office of Economic Development and International Trade (OEDIT) will certify $5 million in income tax credits in 2016 and $10 million each year between 2017 and 2019.

The office may charge a fee of up to $500 for processing the applications of these potential recipients of the credit. In addition, OEDIT may charge an issuance fee when the owner claims the income tax credit. The issuance fee is up to 3% of the amount of the tax credit issued.

A reasonable fee may also be applied to applications for residential projects. Revenue from both the application and issuance fees is evenly shared among OEDIT, the Colorado Historical Society, and the Colorado Department of Revenue. The bill also requires OEDIT and the Colorado Historical Society to develop standards for the approval of the historical structures for which the income tax credit is being claimed.

To qualify, the property must be included on the National Register of Historic Places or have been designated as a landmark by a certified local government. The credit is available for both income-producing properties, such as apartments and commercial properties, and residential structures. The rehabilitation must be “substantial” which means the rehabilitation costs must exceed 25% of the owner’s original purchase price for commercial structures and $5,000 for residential structures. The taxpayer cannot claim the income tax credit until the project has been completed.

For commercial structures, the total amount of the income tax credit is equal to 25% of qualified costs up to $2 million; plus 20% of qualified costs that are greater than $2 million. The value of the credit is capped at $1 million for each commercial structure project. The credit is not refundable but may be carried forward for up to 10 years. However, the taxpayer may choose to transfer all or a portion of the income tax credit to another taxpayer.

For residential structures, the amount of the credit is equal to 20% of the rehabilitation costs, not to exceed $50,000 for each residential property. Income tax credits for residential structures are not transferable but may be carried forward for up to 10 years.

Finally, if the property is located in an area that has been determined to be in a disaster area, the project qualifies for an additional income tax credit. The amount of the income tax credit would increase by 5% in all the cost categories described.

Current federal and state tax laws provide income tax credits for historic preservation projects. The federal income tax credit is

Tax | Continued on 24 July/Aug 2014 • www.cocpa.org •

23

Legislative Update

Tax | Continued from 23 equal to 20% of qualifying expenses. It is only available for properties that will be used for business or other income–producing purposes. Finally, the historical structure must be certified by the National Park Service, and the rehabilitation work must meet the Secretary of the Interior’s standards for rehabilitation.

The state income tax credit is equal to 20% of the qualified rehabilitation costs up to a maximum of $50,000 per qualified property. The structure must be at least 50 years old and designated as a contributing property in the State Register of Historic Places or designated as a landmark by a certified local government. The availability of the credit is contingent upon the December Legislative Council revenue forecast showing that General Fund appropriations can grow by 6%.

HB 14-1326 — Tax Incentives for Alternative Fuel Trucks: This bill

makes numerous changes affecting lowemission and alternative fuel vehicles. It: • Creates an income tax credit equal to a percentage of the purchase or conversion cost of light duty, medium duty, and heavy duty trucks, as well as some light duty passenger motor vehicles, when the vehicle being purchased or converted uses certain alternative fuels or emission reduction technologies. The credit is refundable and available for vehicles purchased in tax years 2014 through 2021.

• Expands the income tax credit to include liquefied natural gas and hydrogen propelled vehicles.

• Provides an income tax credit for the purchase of clean fuel refrigerated trailers and the conversion of hydraulic hybrid trucks.

• Limits the current sales and use tax exemption beginning July 1, 2014, to vehicles with gross vehicle weight ratings of between 10,000 and 26,000 pounds. Vehicles weighing over 26,000 pounds may qualify for the exemption if their power sources meet certain Environmental Protection Agency emissions standards.

24

• NewsAccount • July/Aug 2014

HB 14-1373 — Property Tax Exemption — Seniors and Disabled Veterans: New C.R.S. §39-3-203(1.5)

(a.5) extends to a disabled veteran’s surviving spouse the C.R.S. §39-3-203 veteran’s

July 1, 2014 through June 30, 2019. Colorado law already provides commercial airlines, used in interstate commerce, an exemption from the state’s sales and use tax. This legislation is intended to put on-demand carriers on equal footing.

SB 14-073 — Environmental Remediation Credit: Beginning in

property tax exemption for 50% of the first $200,000 of actual value of qualified residential real property if the property is owner-occupied and used as the primary residence of the surviving spouse owneroccupier as of assessment date, and if the disabled veteran previously received the analogous exemption (under C.R.S. §393-203(1.5)(a)). New C.R.S. §39-3-203(6) (a)(I.5) provides a waiver for the 10-year ownership and use test for a new residence in the case where an owner-occupier would have qualified for the residential real property exemption for a former residence but moved from it due to its being destroyed or otherwise rendered uninhabitable in a natural disaster.

HB 14-1374 — On-Demand Air Carrier Sales and Use Tax Exemption: This

bill creates a sales and use tax exemption for new or used aircraft purchased by on-demand air carriers if the aircraft is in the state for final assembly or maintenance; it will be removed from the state within 120 days; and it will not be in the state for more than 73 days in three years after the airplane has been removed from the state. The exemption would be available for five years beginning

tax year 2014 through tax year 2022, this bill creates an income tax credit for individuals, organizations, and “qualified entities” that perform any approved environmental remediation of contaminated property. The total amount of the credit is 40% of the first $750,000 of remediation costs and 30% of costs over $750,000 up to $1.5 million dollars. The bill allows the Department of Public Health and Environment (CDPHE) to authorize $3 million in tax credits each year the credit is available.

No credit shall be allowed for any costs exceeding $1.5 million on any individual project.

The bill defines a qualified entity as a county, home rule county, city, town, home rule city, home rule city and county, or a private nonprofit entity. A certificate from the CDPHE verifying the project qualifies for the credit is required to claim the income tax credit. The credit may be carried forward for up to five years, or the taxpayer may choose to transfer all or a portion of the income tax credit to another taxpayer, regardless of whether the transferor received value in exchange for the credit.

Severance Tax HB 14-1371 — Wellhead Point of Property Valuation and Taxation: This

bill specifies that the oil and gas wellhead is the point of valuation and taxation for property tax purposes. This will eliminate the need to prorate the tax for horizontal drilling that crosses multiple local government taxing districts. s Mark Kozik, Esq., Holland & Hart, LLP, can be reached at 303-295-8191 or makozik@hollandhart.com. Bruce Nelson, CPA, EKS&H LLLP, can be reached at 970282-5446 or bnelson@eksh.com.

Insurance

Coverage Tips for Managing Risk

BY JACK WITHERSPOON

CPA firms and their partners face many risk exposures daily — exposures that can stem from gaps in insurance coverage and cause major problems. For instance, firms rely heavily on technology and client data to perform services, so it is critical to ensure coverage for damage that might be done not just to clients but to the firm’s own computer systems, data, and assets. Fraudulent and illegal behaviors are also pervasive, creating exposures that your firm and clients may have from client employees, as well as from your own staff members. The many risk exposures to firms and partners can seem overwhelming, but taken one at a time they can be managed to fall well within your risk appetite. Consider the following scenarios and solutions.

Business Liability Problem: Your firm hosts a reception where alcohol is served, and a tipsy client trips and breaks his wrist. He sues your firm for medical expenses, loss of income, and pain and suffering.

Solution: Business liability coverage protects the policyholder from financial loss resulting from claims of injury or damage caused to others by you or your employees, including damages from medical costs, personal injury, libel, slander, disparagement, and advertising misprints. Business liability policies are also combined with other general liability policies to create a more comprehensive business owners package.

Business Property Problem: An office fire damages your furniture, fixtures, and equipment. Valuable papers and records are destroyed. Your business, cash flow, and revenues come to a halt, and you must rent temporary space to continue operations.

Solution: A business owners policy protects the property your business owns, including office equipment, phone systems, furniture, and inventory damaged by fire,

theft, or other covered perils. Some policies also cover damaged computers and media, and loss of income and valuable papers to help you meet your continuing financial obligations, such as rent or payroll and extra expenses for additional costs.

Data Breach Problem: A hacker attacks your computer system and compromises confidential client data. When you notify affected clients that their personal identity information has been exposed, they threaten to take their business elsewhere and demand that you pay for credit-monitoring services for them.

Solution: Some professional liability policies cover the costs to notify third parties of unauthorized disclosure of personal identity information. However, expenses for credit monitoring services, public relations, and reputational services are generally covered by a data breach insurance policy.

Workers’ Compensation Problem: A staff member throws his back out while lifting a box and opts for back surgery.

Solution: Workers’ Compensation is mandatory for all businesses with employees operating in Colorado. The policy protects the firm against liability arising out of employee injury at statutory benefits, and it covers employers’ liability.

Professional Liability Problem: Your largest client goes bankrupt and blames your firm for having neglected to advise and warn management.

“We relied on the CPA firm for help, and it failed to advise us about how vulnerable our business was to a market downturn.”

Solution: An appropriate professional liability policy will cover the damages from errors or omissions and protect the assets of your firm and its owners. Professional liability is a complex field, and an insurance

program should include a high level of support from the carrier in the underwriting, loss prevention, and claims processes. Policyholders should seek advice from their insurance agent regarding their unique situations and major questions such as: “What should our policy limit be?” “Should we have a policy with an aggregate limit that is higher than the per-claim limit (e.g., split limit)?” “How much of a deductible should we have?”

“How should we manage our risks?” “How many support services and resources are offered?”

Employment Practices Liability Problem: A middle-aged employee sues your firm for wrongful termination, alleging age discrimination when the firm had not provided him with the same opportunities it had provided younger employees. The jury awards a $1.1 million verdict against the firm.

Solution: Thousands of such charges are filed every year, alleging violations of laws prohibiting discrimination and similar acts on the basis of age, gender, sexual orientation, physical or mental disability, medical condition, pregnancy, physical appearance, religion or creed, national origin or ethnicity, race, or color.

Employment practices liability insurance should include extensive support to help policyholders avoid or reduce the impact of such charges. Are there telephone consulting services to assist policyholders with human resources protocols?

Is there online support with tools such as job descriptions, best practices, and comprehensive employee handbook templates?

Clearly, the unique risk exposures and challenges to firm partners can be daunting, but by discussing your situation with your insurance agent, you can determine the best options for you and your firm. s Jack Witherspoon heads CAMICO Insurance Services. Contact him at 800-6521772, ext. 6847.

July/Aug 2014 • www.cocpa.org •

25

CGMA

New Competency Framework Enhances CGMA Value As the accounting profession evolves, so does the set of skills required of individuals and their teams. Over the past two years, the AICPA has joined with the Chartered Institute of Management Accountants (CIMA) in reaching out to companies around the globe. They heard that executives are looking for finance professionals with strong technical and people skills, an understanding of the business, and the potential to be leaders within their organizations. The new CGMA Competency Framework helps management accountants and their employers identify the competencies needed to adapt to these shifting business demands.

The Research The AICPA and CIMA conducted extensive global research with employers, identifying the competencies organizations require to drive better business. The research, which was used to develop the competency framework, was conducted in three phases: • Face-to-face interviews performed with 67 organizations from the United States, Malaysia, South Africa, and the United Kingdom • Roundtable discussions held in 13 countries in the Americas, Asia, Europe, and Africa • Online survey taken by nearly 3,400 CIMA members, students, academics, and tuition providers

Research participants included both finance and non-finance staff in mid- to senior-level positions from a wide range of industries in both the private and public sectors.

Knowledge and Skills Defined The new employer-driven framework is designed around four knowledge areas that have a series of relevant integrated competencies or functions. Each competency prescribes a series of skills that assist in the CGMA’s professional development and can be performed at, and measured by, four proficiency levels. Knowledge areas within the framework include: • Technical skills that enable finance professionals to collect, store, process, and analyze information to be shared with stakeholders • Business skills that allow finance professionals to use their knowledge of the business and its environment to transform data into strategic insights • People skills that influence the decisions, actions, and behaviors of decision makers, others throughout the organization, and stakeholders • Leadership skills that span peer, functional, and strategic levels The proficiency levels for each competency skill are Foundational (staff/entry level), Intermediate (supervisor/manager),

Advanced (senior manager), and Expert (executive/C-suite). The importance of each skill varies by proficiency level, and the more important the skill is at a specific level, the higher it will be weighted on a 100-point scale. As a result, as individuals advance in their proficiency and career, the weighting of individual skills will change accordingly.

For example, finance professionals at the Foundational level will receive the highest weighting for Technical skills. Yet, as they progress along proficiency levels, the weighting for Technical skills will decrease while weightings for Business, People, and Leadership skills will increase consistently with their career progress. At the Advanced level, the importance of Business skills and People skills level off, and the importance of Leadership skills increases.

The Qualification Syllabus and Assessment Exam The framework is the foundation that will demonstrate the relevance and capabilities of a CGMA as a trusted finance and business strategist because it’s the underpinning of the CIMA syllabus, which will be covered in the mandatory CGMA strategic case study examination coming in 2015.

To learn more, contact Nancy MarcThrasybule, Technical Manager, AICPA Management Accounting Team, at nmarcthrasybule@aicpa.org. s

Movers & Shakers Marilyn Sudbeck, CPA, of Nimbus Consulting, was named a Top 100 QuickBooks ProAdvisor. There are approximately 70,000 QuickBooks ProAdvisors of whom about 25,000 are Certified QuickBooks ProAdvisors. Sudbeck is also the only Colorado member of Intuit’s Trainer/Writer Network.

Kristina Kesselring, CPA, Manager, BKD CPAs & Advisors, earned the Personal Financial Specialist (PFS) certification from the American Institute of CPAs (AICPA).

London-based UK investment leader Fitzgerald & Law announced its partnership with EKS&H LLLP to provide complementary services which ‘bridge the gap’ between the U.S. and the UK.

26

• NewsAccount • July/Aug 2014

Stephen Vlasak, CPA, joined Richey May & Co., LLP as director of business development.

Dalby, Wendland & Co., P.C., promoted Nathan A. Fyock, CPA; Sabrina J. Hoyt, CPA; and Lisa Thon-Kollar, CPA, to manager. Other promotions included Jennifer M. Street, CPA, to accounting supervisor, and Jeff M. Wilson, CPA, Brittany A. Dreher, and Christina R. Still to senior accountant.

Former Colorado State Auditor Timothy M. O'Brien, CPA, announced his candidacy for Denver City Auditor in 2015.

July/Aug 2014 • www.cocpa.org •

27

CAMICO is sponsored by

www.camico.com/momentum

Accountants Professional Liability coverage is underwritten by CAMICO Mutual Insurance Company and/or Liberty Insurance Underwriters Inc. Liberty Mutual currently carries an A.M. Best rating of “A (Excellent).” Actual coverage may vary and is subject to policy language as issued. ©2014 CAMICO Services, Inc. License #0C09618.

Find out for yourself why more CPA firms are choosing CAMICO.

Find out for yourself why more CPA firms are choosing CAMICO.

provide your firm with even greater capacity, options, flexibility and benefits.

better than anyone else. With our Accountants Professional Liability program in through Liberty International Underwriters, We specialize CPA firms.

This is all we do, and we do it better wethan can anyone provide your with even greater capacity, options,Liability else.firm With our Accountants Professional flexibility and benefits. program through Liberty International Underwriters, we can

value and providing even greater benefits and options to our policyholders years.

We specialize in for CPA28 firms.

This is all we do, and we do it

CAMICO is constantly taking its unparalleled insurance and risk management services further. Enhancing services, products CAMICO constantly its unparalleled insurance and solutionsisfor CPA firmstaking since 1986, we have been building and risk management services further.benefits Enhancing services, value and providing even greater and options for products and solutions policyholders forfor 27 CPA years.firms since 1986, we have been building

Momentum.

Momentum.

In Memoriam

We regret the loss of the following COCPA members. We extend our sympathy to their families, colleagues, and friends.

Roland N. Bame Member since 1958 Englewood, Colo.

William E. Lemke Member since 1976 Brighton, Colo.

Richard L. Lundvall Member since 1982 Wheat Ridge, Colo.

Henry H. Philips III Member since 1978 Durango, Colo.

Classifieds Opportunities Available Isaak Bond Investments, a broker dealer in securities since 1977, is interested in hiring, including training, a CPA (retired or approaching retirement) still having the desire to be active. A candidate would assume responsibility of servicing existing clients with retirement income investments, both tax-exempt and taxable. A Series 7 qualification would be required. Assistance in obtaining the Series 7 through classroom attendance would be available. Please call Calvin F. Isaak, who has over 50 years’ experience in fixed income securities, for an interview at 303-623-7500.

Experienced Tax Professionals — Senior, Supervisor, and Manager Levels. Continue your career with a market-leader firm in Western Colorado. Dalby, Wendland & Co., P.C. (DWC) is currently seeking Senior Tax Accountants, Supervisor Tax Accountants, and Manager Tax Accountants to join any of our three office locations in Grand Junction, Glenwood Springs, or Montrose. You must have solid technical skills in income taxation, a strong general accounting background, and effective oral and written communication skills, along with the following staffing level requirements: Senior — a licensed CPA or a CPA candidate with 2-5 years experience in public accounting; Supervisor — a licensed CPA with 4-6 years experience in public accounting; and Manager — a licensed CPA with 6-10 years experience in public accounting with the potential to be a firm shareholder. DWC’s strong team culture and quality-focused work environment provide challenging opportunities and growth throughout your career. We are consistently ranked by Accounting Today as one of the top firms in the Mountain States Region. We believe in trust, respect, and responsibility to foster collaboration and excellence. Our firm provides a good work/life balance, competitive compensation, a comprehensive benefits package, and opportunities for advancement.

To apply, email your cover letter and resume to HR@dalbycpa.com, or for more information, visit our careers section at www.DalbyCPA. com.

Practices for Sale, Purchase, or Merger CPA firms or partners. We represent a number of quality CPA firms which are looking to merge, acquire, or sell their practices to other CPA firms or partners with business. Locations are in the Denver area.This is an opportunity to ensure your future as well as help your clients by expanding your services to them. Why settle when you can select? Established in 1939. For further information, please contact: Phil Rubeck at D&R Associates of Colo., 720-446-7020 or email: dandrassociatesofco@aol.com.

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 303-771-3100, fax 303-477-6010, or fmehring@selectbg.com.

Office Space Available Greenwood Executive Park at Quebec St. and Peakview Ave. (Near I-25 and Arapahoe Road), Greenwood Village. Windowed office, conference room, kitchen, receptionist, copier, fax, telephone system, DSL line, tax library, free parking, great environment. Arlyn or Neil 303-771-7377.

28

• NewsAccount • July/Aug 2014

Save 10%

Each Focus Series includes: •

2 in-person classes for 8 hours each (with live-streaming webcast option)

•

1 free two-hour COCPA ethics webcast

•

2 webcasts for 4 hours each

•

•

Access to a custom LINK community where you can share information, ask questions, and network with peers Save 10% off the purchase price of each class and conference in the series.

FOCUS SERIES With the breadth of CPE courses available, finding the ones that fit your needs can become daunting. The COCPA has you covered.

With the new Focus Series, you can buy a package of up to 34 credits built around your focus needs with ONE SIMPLE CLICK.

Industry Focus Series

Non-Member Price

8/25 (Denver or webcast)

$355

$507

11/13 (Denver or webcast)

$355

$507

$149

$149

Live Programs or Live-Streaming Webcast (8 hours each)

Common Frauds and Internal Con trols for Revenue, Purchasing, and Cash Receipts Annual Update for Controllers

Webcasts - multiple dates (4 hours eac h)

Free 2-hour COCPA ethics webcast Analyzing a Company’s Financia Risk Cost and Cash Management

l Statements

for Controllers and Financial Man

agers

$149

$149

$1008

$1312

$907

$1181

Total Total cost with 10% off 10/29

Optional Add-on Conference (8 hou

2014 CPAs in Industry Conference

rs)

Total Cost with 10% off and addi

tional conference

Series Not-for-Profit Focus

(8 hours each) -Streaming Webcast ve Li or s m ra og Pr Live nver or webofit and 7/23 (De Pr lar A-133 to Not-forApplying OMB Circu nizations Governmental Orga

date ting and Auditing Up Not-for-Profit Accoun

To register, go to the Course Search page at www.cocpa.org, and look for Focus Series in the right hand column.

Member Price

$335

$479

$1209

$1612

Member Price

Non-Member Price

$355 (add $20

$507 (add $20

$355

$507

for Pueblo)

cast), 7/24 (Pueblo) 11/5 (Denver)

12/16

for Pueblo)

(Denver)

s (4 hours each)

te Webcasts - multiple da

ethics webcast Free 2-hour COCPA and sk in Governmental sponding to Fraud Ri Recognizing and Re ations Not-for-Profit Organiz l Audits Yellow Book Financia

$149

$149

$149

$149

Total $1008

Total cost with 10%

off

$907

$1312 $1181

29

Colorado Society of Certified Public Accountants 7887 E. Belleview Ave., Suite 200 Englewood, CO 80111-6076

Periodicals Postage

Headed Your Way: July CPE Across Colorado Compilation and Review Engagement Fundamentals July 14 (COCPA) • $355 / $507 Financial Reporting Framework for SMEs July 15 (COCPA) • $355 / $507 Internal Control Essentials for Accountants and Auditors July 16 (Colorado Springs) • $375 / $536

TO REGISTER: www.cocpa.org • 303-773-2877 • 800-523-9082

A Practical Guide to Small Business Health Insurance and Fringe Benefits: 2014 and Beyond July 21 (Westminster) • $385 / $550 July 24 (Aspen) • $395 / $564

Getting More Active with the Passive Activity Rules and the New Net Investment Income Tax July 22 (Westminster) • $385 / $550 July 25 (Aspen) • $395 / $564

Annual Update: Top 12 Governmental and Not-for-Profit Accounting and Auditing Issues Facing CPAs July 22 (COCPA) • $355 / $507

Applying OMB Circular A-133 to Not-for-Profit and Governmental Organizations July 23 (COCPA or webcast) • $355 / $507 July 24 (Pueblo) • $375 / $536

Health Care Reform Act: Critical Tax and Insurance Ramifications July 28 (Colorado Springs) • $180 / $257 July 29 (Longmont) • $180 / $257 Social Security and Medicare: Maximizing Retirement Benefits July 28 (Colorado Springs) • $180 / $257 July 29 (Longmont) • $180 / $257 • Denotes Member/Nonmember Course Fees