Friday, August 17, 2012

An Accountant's Inbox

Why don't I write more about what I do for a living? Well, true to the popular stereotype, accounting is pretty boring to everyone who is not an accountant, and even some accountants have been known to nod off after a while. (Quick! name TV shows whose lead character is a CPA. Right, can't do it because THERE ARE NONE.)

Here are two typical examples of materials that flood the inbox.

Draft of the AICPA Audit and Accounting Guide Not-for-Profit Entities. This is an increasingly important topic. Non-profit entities are growing like Topsy. Their accounting issues are just as complicated, if not more so, than for-profit businesses. Not only must NPE's abide by Generally Accepted Accounting Principles, they must make sure restricted donations are properly walled off from the rest of the entity's operations and that program expenses are reported separately.

The draft guide is 476 pages long, and the vast majority of non-profits don't have the resources to follow every jot and tittle. Red tape sticks to both the just and the unjust.

Depreciation on Office Artwork. Depreciation on office artwork hardly comes up for most accountants. In Taxation 101 one learned that art doesn't depreciate--Winged Victory looks the same as it did for millennia, right?

It turns out that the subject isn't closed. The IRS ruled in 1968 that a "valuable and treasured art piece does not have a determinable useful life." When I look at the stuff hanging on the walls of my doctor's or stockbroker's office, the adjectives valuable and treasured aren't the first words that pop into mind.

The author marks the changes in tax depreciation law since 1968 and argues that most office artwork is depreciable. The article turned out to be interesting. I guess that's why I'm an accountant, and you're probably not.

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