ACCURATE AND EFFECTIVE DISCLOSURES MORE IMPORTANT THAN EVER WITH NEW REGULATIONS AND REQUIREMENTS
By Marta Mikolajczak, CPA

Along with the tremendous weight of tangible property regulations (TPR) on 2014 tax filings, financial statement reporting and attest services were also affected by TPR. Implementation of the new regulations resulted in reconsidering and updating capitalization policies for many clients and reorganizing data tracing. In addition to new written capitalization policies, De Minimis safe harbor rules and other tangible property issues, companies are faced with increasing requirements for financial statement disclosures. Despite the Financial Accounting Standards Board's effort to improve effectiveness of disclosures in the financial statements, accounting standards setting is contributing to increased volume and complexity of financial disclosures. Among other standards updates, recent and upcoming changes include applying variable interest entities guidance to common control leasing arrangements, presentation of debt issuance costs, and elimination of development-stage entity guidance.

We've been working collaboratively with our clients to achieve the objective of accurate and effective disclosures. Due to the expansion of required disclosures, it is crucial to seek professional advice on changes in accounting standards and required disclosures. Contact your professional at UHY LLP in Detroit 313 964 1040, Farmington Hills 248 355 1040 or Sterling Heights 586 254 1040, or visit us on the web at www.uhy-us.com.
 

By Andy Molokac

Although more volatile, perhaps, than policy makers would like, recent employment reports point to both a strong labor market for professionals and the expanded use of flexible staffing resources by US employers. For example:
 

• The most recent national unemployment rate was 5.4 percent; the lowest level in nearly eight years.
• Unemployment rates for those who are over 25 and possess a college degree are dramatically lower still staying consistently in the 2.6 percent to 3 percent range. This group includes finance and accounting professionals.
• Use of temporary labor in the market continues to increase with temporary employment penetration rates operating at historically high levels over 2.1 percent.

The Michigan economy mirrors these broader national trends:
 

• The most recent unemployment level in the state was 5.5 percent. After being significantly higher than the national average for the last several years, the Michigan unemployment rate and the US rate are now virtually the same.
• Stated in another way, Michigan's unemployment rate has declined at a faster rate than the rest of the US.
• Professional and business service employment is running near all-time highs.
• Use of temporary staff by Michigan employers is also running at all-time highs.

What does all this mean for labor markets in general and for the finance and accounting space specifically?
 

• "Blended" workforce models will continue to expand. In the blended workforce model, companies typically maintain a core of traditional, direct hire employees supported by an outer ring of contractors that can be adjusted to meet business needs. This provides companies with flexibility, cost savings, and reduced liability. Many companies are still feeling the sting of the recession and the idea of adding permanent "indirect" labor or staff headcount is still a tough sell. Some variability in headcount will be a desirable strategy for some time to come.
• Labor markets will continue to tighten and employers will need to adjust. In an environment when significant slack exists employers have the upper hand. But as the markets tighten, labor costs will inevitably increase. In addition, employers may need to adjust their hiring criteria as the pool of highly qualified candidates tightens.
• Leveraging the emerging "contractor model" will be important. Independent contract professionals have been a significant part of the information technology labor market for some time. This model is gaining acceptance in other sectors including finance and accounting. Younger staff in particular find contracting appealing since it provides more flexibility, variety, and more control over their careers. In addition, the growth of the Internet and mobile devices has changed employment, allowing employees to work remotely. These remote workers are the perfect candidates to take on the type of project-based work that is common to contract assignments.
• Boomers are retiring and transition plans will be increasingly important. At the other end of the spectrum, Baby Boomers are beginning to retire, creating a knowledge deficit for many industries and companies.

Our firm's Resource Solutions group provides clients with accomplished professionals to support finance, accounting, internal audit and tax teams. We work hard to deliver top talent at reasonable bill rates. Most of our professionals have a combination of public accounting and industry experience, and many of them have professional certifications in their areas of expertise (i.e., CPA, CIA, CISA, PMP, etc.). Our experience allows us to integrate quickly with your team with minimal startup time and supervision.

Our process is simple. We take the time to understand our client's needs and present experienced consultants from our team that are well qualified for the engagement at hand. Our consultants work directly with our clients: onsite at their offices, using their software, updating their files, and so on.

 

Contact a member of our firm's Resource Solutions group in Detroit 313 964 1040, Farmington Hills 248 355 1040 or Sterling Heights 586 254 1040, or visit us on the web at www.uhy-us.com.to learn more about how we can help.

Preparing our clients for the biggest transaction of their lifetime

With today's technology, company information is flowing to more places than ever. An increasing amount of companies are using cloud storage to house data, which puts them more at risk to hackers. Hackers are becoming more creative and are finding new ways to get past firewalls and security software. In addition, the increased use of cloud service providers may also make companies, both large and small, vulnerable.

"Cyber predators are getting savvier in that they are targeting organizations that service a particular company, rather than the target company itself. For example, instead of directly targeting 'Bank A', a hacker may target Bank A's auditor to steal the information they are looking for," says UHY Advisors' Chief Information Officer John Neall.

To ensure our clients' information is safeguarded, UHY has imposed various IT infrastructure improvements and will continue its efforts as technology evolves. Among these improvements, our firm carefully interviewed several possible IT security providers and recently signed into an agreement with a very reputable third party vendor that provides effective security solutions for cloud and hybrid data infrastructures. The team works round' the clock, constantly scanning the entire network to detect threats and suspicious activity. "We found a provider that has hundreds of people dedicating 100 percent of their time to network security. This is a level of expertise that we can't get anywhere else," says Neall. "Having visibility to our network and isolating the traffic that may be dangerous to us is critical to ensure our information is protected. Without it, there would be almost no way to even know if our data was compromised."

Another improvement was with servers and end-user disruption - firewall, encryption, updates, virus protection and traffic monitoring. Internal policy has also been revamped to ensure risk is minimized. "While we have a number of policies and systems in place to protect us, the people part of the equation is probably the most challenging. Something as simple as giving out their password to someone they think works for the firm, can break every other security system and process in place," adds Neall.
  

By Steve Katzman, CPA

On April 22, the Financial Accounting Standards Board (FASB) issued an exposure draft for the proposed accounting standards update, Presentation of Financial Statements of Not-for Profit Entities. These proposed changes represent the largest shift in nonprofit reporting since the implementation of FAS 116 and FAS 117 in the mid-1990s and will impact organizations across the entire nonprofit sector.

The proposal introduces a new approach to defining "operating activities". All entities will be required to provide an overall operating measure based on two dimensions - mission and availability of resources on the Statement of Activities. Mission considers whether resources result from or are directed at carrying out the organization's purpose for existence. Availability considers whether resources are available for current period activities based on the presence or absence of limitations imposed by external donors or internal actions of the organization's governing board. Under the proposal, an operating excess or deficit subtotal would be required for all nonprofits. A new "transfer" category would represent movements of resources between operating and non-operating categories and the operating measure would be reported with and without the effect of the transfers.

Other key changes in the proposed standard include:
 

• The number of net asset classes presented will be reduced from three to two; those subject to donor restrictions and those not subject to donor restrictions
• The statement of cash flows will be presented using the direct method, with the intention that it would provide information similar to a statement of activities on a cash basis
• Certain items presented on the statement of cash flows will be reclassified to better align with operating activities
• Information about liquidity will be required to be presented in the notes to the financial statements

For the latest FASB updates or on this proposed accounting standards update specifically, please contact your professional at UHY LLP in Detroit 313 964 1040, Farmington Hills 248 355 1040 or Sterling Heights 586 254 1040, or visit us on the web at www.uhy-us.com. 

 

As an independent member of Urbach Hacker Young International Limited ("UHYI" or "UHY"), we are able to call upon the resources of professional service firms throughout the world. Established in 1986 and based in London, UHY is a world leader in audit, accounting, tax and business advisory services. The network brings together the global expertise of UHY's independent members, all highly regarded, professional and reputable firms in their own local markets. UHY is the 16th largest international accounting and consultancy network, with over 7,600 professionals in nearly 300 cities in 89 countries.

UHY Global Directory 2015

International clients require a wide range of services to ensure proper compliance and business relations. UHY seeks to provide service of consistently superior quality around the world. We build strong relationships by providing services based on quality, integrity and transparency. We can provide in-country expertise where required and cohesive, cross-border teams to deliver customized and timely services to help our clients make the right decisions. Our drive for professionalism, quality, integrity and innovation combined with our global reach have realized substantial growth for both clients and member firms.  

As reported in Crain's Detroit Business in late March, UHY Advisors' Corporate Finance team presented private equity firm O2 Investment Partners LLC with the potential acquisition of a technology client, PC Treasures, Inc. At first Jay Hansen, managing partner of O2, had a hard time grasping PC's business. PC Treasures is a multi-channel distributor of licensed multimedia bundles and cutting-edge computer, tablet and smartphone accessories, and other specialty products. It took a while for Hansen and his staff to understand PC's niche, causing the deal to take longer, but the light finally went on.

Due diligence taught Hansen and Todd Fink, another O2 managing partner, that there was a profit to be made in bundling. They also learned that they were compatible with the co-founders of PC Treasures. The deal was especially complex because PC has a unique business model. They were launching a new major product and it was the middle of their busiest season. It was also imperative that the "family" culture remained intact to maintain great customer relationships built on mutual trust and quickly capitalize on new market opportunities.

The unique nature of the transaction forced the advisors on the deal to come up with creative solutions that would meet the needs of all parties. Despite the complications, the deal went smoothly and PC's co-founders Brian Austin and Les Thomas agreed to invest some of the proceeds from the sale back into the company.

The deal closed in November 2014, PC Treasures busiest season, and was awarded "Deal of the Year: Best Deal under $100 Million" by Crain's Detroit Business. UHY's team played a crucial role in facilitating the transaction. Operating under Steve McCarty; Aaron Witalec, Bob Kendall and Alex Conti acted as sell side advisors on the deal.
 

Are you ready to take charge of your career path? Be sure to visit our careers page for the most up to date career listings or contact Yolanda Rountree at yrountree@uhy-us.com or 586 843 2642. Check out some of the current opportunities in our Michigan offices: 

 

• Audit Manager, 7+ years of experience, manufacturing experience is highly preferred
• Audit Manager, 7+ years of experience, SEC experience is highly preferred
• Audit Accountant, 2-10 years of experience working with municipalities
• Audit Senior Staff Accountant, 2-4 years of experience
• Internal Audit Risk & Compliance Manager, 7+ years of experience
• R&D Tax Specialist, 7+ years of experience
• Tax Manager, 7-10 years of experience, marketing experience is required
• Tax Senior Consultant, 4-5 years of experience, Big 4 experience is required
• Tax Senior Accountant, 5-7 years of experience, CPA required
• Director of Litigation, testifying experience required municipalities
• Senior Associate (Corporate Finance), 2-4 years of Big 4 experience highly preferred 

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