An employer sponsoring an ESOP under generally accepted accounting principles ASC 718-40 Employee Stock Ownership Plans (formerly SOP 93-6, Employers’ Accounting for Employee Stock Ownership Plans) should disclose the following information about the plan, if applicable. Since plan sponsors are ultimately responsible for their entity’s financial statements, such Plan sponsors having an ESOP are well…
Share Implementing A Conflict Of Interest Policy The governance of a not-for-profit agency, regardless of the population it serves, mandates that the organization avoid situations which violate the rules and regulations of the Internal Revenue Service (“IRS”), in order to maintain its tax-exempt status. It is, therefore, of paramount importance to a charitable organization to…
SRO DEAD… For now? A few weeks back I blogged about an article my partner Matt Pribila wrote concerning the push for more regulations over Registered Investment Advisors (RIAs). The issue, at the time, seemed to be whether the SEC (Securities and Exchange Commission), FINRA (Financial Investment Regulator Association) or an SRO (self regulating organization)…
Know Your Auditor I was just reading that another fraud in the financial arena went undetected for over 20 years. This time Peregrine Financial Group (aka OFG Best) filed Chapter 7 bankruptcy on July 7, 2012, after being sued by the US Commodity Futures Trading Commission. The founder, Russell R. Wasendorf, Sr., who is accused…
The Association of Certified Fraud Examiners (ACFE) recently published its 2012 Report to the Nations on Occupational Fraud and Abuse. This publication reports the findings from an analysis of more than 1,300 cases of occupational fraud that were reported to the ACFE by Certified Fraud Examiners (CFEs) around the world. Consistent with information gathered by…
Share Know Your Customer Rule In November 2010 the Securities and Exchange Commission (SEC) approved two new consolidated FINRA rules governing know-your-customer (Rule 2090) and suitability (Rule 2111) obligations of broker-dealers. These rules were to take effect on October 7, 2011 but were extended until July 9, 2012. What this means for a broker-dealer and…
Leveraged ESOPs Email Virginia In a leveraged ESOP, the ESOP or its corporate sponsor (“the Company”) borrow money from a bank or other qualified lender. The Company will typically give the lender a guarantee that it will make contributions to the ESOP trust, which will enable the ESOP trust to payback the loans, or…
Share Estate and Trust July 2012 Consider Utilizing Your Lifetime Gift Exemption By Funding A Spousal Lifetime Access Trust A Spousal Lifetime Access Trust can provide a spouse with limited accessibility during his or her lifetime while keeping the assets out of both spouses taxable estates. Author: Hal R. Terr, CPA, PFS, CFP®, AEP®, Partner…
Share Residual Receipts & Surplus Cash HUD requires certain projects to include a Supplemental Schedule of Surplus Cash in their annual financial statements. For newer projects or projects that historically haven’t had surplus cash, a residual receipts account would not be necessary, however, it’s important to know that a residual receipts deposit may be required…
Federal/State Grant Compliance Requirements Determining when to apply Federal/state grant compliance requirements can sometimes be tricky. A common misunderstanding of the cash management compliance requirement is that it only applies when grant funds are advanced prior to incurring the costs. However, Federal/state grant recipients with cost reimbursement grant contracts must also comply with this requirement. This…