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<br /> www.cpaj.com April 2014<br /> A FRESH APPROACH<br /> TO REGULATION AND<br /> AUDIT QUALITY<br /> An Interview with<br /> PCAOB Board Member<br /> Jay D. Hanson<br /> +<br /> TAX FRAUD<br /> NEW AUDIT REPORT<br /> CONFIDENTIALITY AND<br /> ILLEGAL ACTS<br /> TRANSNATIONAL AUDIT<br /> REGULATION<br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> your next gen eration f firm l aders <br /> <br /> <a title="The CPA Journal - April 2014 page 1" href="http://viewer.zmags.com/publication/bce2f8b9?page=1"> www.cpaj.com April 2014 A FRESH A</a> <a title="The CPA Journal - April 2014 page 2" href="http://viewer.zmags.com/publication/bce2f8b9?page=2"> </a> <a title="The CPA Journal - April 2014 page 3" href="http://viewer.zmags.com/publication/bce2f8b9?page=3"> Not Yet a Member? Well, You’re Missing Out! </a> <a title="The CPA Journal - April 2014 page 4" href="http://viewer.zmags.com/publication/bce2f8b9?page=4"> CONTENTS april 2014 6 PERSPECTIVES 14 IN FOC</a> <a title="The CPA Journal - April 2014 page 5" href="http://viewer.zmags.com/publication/bce2f8b9?page=5"> vol. LXXXIV/no. 4 24 ESSENTIALS 68 ESSEN</a> <a title="The CPA Journal - April 2014 page 6" href="http://viewer.zmags.com/publication/bce2f8b9?page=6"> The Complete Guide to Payroll Taxes and 1099 I</a> <a title="The CPA Journal - April 2014 page 7" href="http://viewer.zmags.com/publication/bce2f8b9?page=7"> publisher’s column Crowdsourcing in the 21st </a> <a title="The CPA Journal - April 2014 page 8" href="http://viewer.zmags.com/publication/bce2f8b9?page=8"> PERSPECTIVES auditing Myths and Inconvenient T</a> <a title="The CPA Journal - April 2014 page 9" href="http://viewer.zmags.com/publication/bce2f8b9?page=9"> The auditing literature specifies that non- </a> <a title="The CPA Journal - April 2014 page 10" href="http://viewer.zmags.com/publication/bce2f8b9?page=10"> equal probability of selection (i.e., selec- tion</a> <a title="The CPA Journal - April 2014 page 11" href="http://viewer.zmags.com/publication/bce2f8b9?page=11"> n Projected error n Upper confidence limit/upper </a> <a title="The CPA Journal - April 2014 page 12" href="http://viewer.zmags.com/publication/bce2f8b9?page=12"> n Using an attributes sampling program, a sample </a> <a title="The CPA Journal - April 2014 page 13" href="http://viewer.zmags.com/publication/bce2f8b9?page=13"> fraud The Reality of Fraud Risk Five Common </a> <a title="The CPA Journal - April 2014 page 14" href="http://viewer.zmags.com/publication/bce2f8b9?page=14"> electronic filing Five Reasons to Go Paperles</a> <a title="The CPA Journal - April 2014 page 15" href="http://viewer.zmags.com/publication/bce2f8b9?page=15"> inbox: letters to the editor Improving Suc</a> <a title="The CPA Journal - April 2014 page 16" href="http://viewer.zmags.com/publication/bce2f8b9?page=16"> In Focus Photos by Jason Miccolo Johnson</a> <a title="The CPA Journal - April 2014 page 17" href="http://viewer.zmags.com/publication/bce2f8b9?page=17"> A FRESH APPROACH TO REGULATION AND AUDIT QUALITY </a> <a title="The CPA Journal - April 2014 page 18" href="http://viewer.zmags.com/publication/bce2f8b9?page=18"> The Role of a PCAOB Board Member The CPA Journal:</a> <a title="The CPA Journal - April 2014 page 19" href="http://viewer.zmags.com/publication/bce2f8b9?page=19"> Increasing Utility of Inspection Reports CPA</a> <a title="The CPA Journal - April 2014 page 20" href="http://viewer.zmags.com/publication/bce2f8b9?page=20"> audit report identifies quality control deficienc</a> <a title="The CPA Journal - April 2014 page 21" href="http://viewer.zmags.com/publication/bce2f8b9?page=21"> first half of 2014. It won’t contain any rule- ma</a> <a title="The CPA Journal - April 2014 page 22" href="http://viewer.zmags.com/publication/bce2f8b9?page=22"> SOME MAY COMPLAIN THAT THE PCAOB IS MAKING </a> <a title="The CPA Journal - April 2014 page 23" href="http://viewer.zmags.com/publication/bce2f8b9?page=23"> things about estimates—and are looking to codify </a> <a title="The CPA Journal - April 2014 page 24" href="http://viewer.zmags.com/publication/bce2f8b9?page=24"> PUTTING THE ENGAGEMENT PARTNER'S NAME IN THE </a> <a title="The CPA Journal - April 2014 page 25" href="http://viewer.zmags.com/publication/bce2f8b9?page=25"> to look somewhere else to find some con- text, so</a> <a title="The CPA Journal - April 2014 page 26" href="http://viewer.zmags.com/publication/bce2f8b9?page=26"> ACCOUNTING & AUDITING auditing </a> <a title="The CPA Journal - April 2014 page 27" href="http://viewer.zmags.com/publication/bce2f8b9?page=27"> n Identification of where significant mat- ters a</a> <a title="The CPA Journal - April 2014 page 28" href="http://viewer.zmags.com/publication/bce2f8b9?page=28"> THE PCAOB'S PROPOSED NEW AUDIT REPORT Report of I</a> <a title="The CPA Journal - April 2014 page 29" href="http://viewer.zmags.com/publication/bce2f8b9?page=29"> n nature of consultations outside the engagement</a> <a title="The CPA Journal - April 2014 page 30" href="http://viewer.zmags.com/publication/bce2f8b9?page=30"> to evaluate, after performing certain required pr</a> <a title="The CPA Journal - April 2014 page 31" href="http://viewer.zmags.com/publication/bce2f8b9?page=31"> of most significance in the audit of the financia</a> <a title="The CPA Journal - April 2014 page 32" href="http://viewer.zmags.com/publication/bce2f8b9?page=32"> ACCOUNTING & AUDITING auditing </a> <a title="The CPA Journal - April 2014 page 33" href="http://viewer.zmags.com/publication/bce2f8b9?page=33"> acquired (the legal acquiree) is the acquirer</a> <a title="The CPA Journal - April 2014 page 34" href="http://viewer.zmags.com/publication/bce2f8b9?page=34"> a need for alternative oversight of the reg- ulat</a> <a title="The CPA Journal - April 2014 page 35" href="http://viewer.zmags.com/publication/bce2f8b9?page=35"> regulator in order to ensure that the PCAOB remai</a> <a title="The CPA Journal - April 2014 page 36" href="http://viewer.zmags.com/publication/bce2f8b9?page=36"> for a decision, not including extensions. If the </a> <a title="The CPA Journal - April 2014 page 37" href="http://viewer.zmags.com/publication/bce2f8b9?page=37"> If the deregistration of China-based auditing f</a> <a title="The CPA Journal - April 2014 page 38" href="http://viewer.zmags.com/publication/bce2f8b9?page=38"> wreaked havoc on the Chinese financial markets; i</a> <a title="The CPA Journal - April 2014 page 39" href="http://viewer.zmags.com/publication/bce2f8b9?page=39"> conform to Staff Practice Alert 6, “Auditor Consi</a> <a title="The CPA Journal - April 2014 page 40" href="http://viewer.zmags.com/publication/bce2f8b9?page=40"> ACCOUNTING & AUDITING financial re</a> <a title="The CPA Journal - April 2014 page 41" href="http://viewer.zmags.com/publication/bce2f8b9?page=41"> Some believed that these costs will drop as c</a> <a title="The CPA Journal - April 2014 page 42" href="http://viewer.zmags.com/publication/bce2f8b9?page=42"> On the other hand, delistings by for- eign comp</a> <a title="The CPA Journal - April 2014 page 43" href="http://viewer.zmags.com/publication/bce2f8b9?page=43"> Possible Detriments to SOX's Effectiveness Sh</a> <a title="The CPA Journal - April 2014 page 44" href="http://viewer.zmags.com/publication/bce2f8b9?page=44"> by their corporate governance, financial reportin</a> <a title="The CPA Journal - April 2014 page 45" href="http://viewer.zmags.com/publication/bce2f8b9?page=45"> captured by this survey have steadily declined si</a> <a title="The CPA Journal - April 2014 page 46" href="http://viewer.zmags.com/publication/bce2f8b9?page=46"> ACCOUNTING & AUDITING financial re</a> <a title="The CPA Journal - April 2014 page 47" href="http://viewer.zmags.com/publication/bce2f8b9?page=47"> SEC staff, Mar. 8, 2007). In addition, the cost a</a> <a title="The CPA Journal - April 2014 page 48" href="http://viewer.zmags.com/publication/bce2f8b9?page=48"> Executives Institute (TEI) filed comments with th</a> <a title="The CPA Journal - April 2014 page 49" href="http://viewer.zmags.com/publication/bce2f8b9?page=49"> pares the ending UTB balance for each com- pany t</a> <a title="The CPA Journal - April 2014 page 50" href="http://viewer.zmags.com/publication/bce2f8b9?page=50"> panies with the five largest positive and five la</a> <a title="The CPA Journal - April 2014 page 51" href="http://viewer.zmags.com/publication/bce2f8b9?page=51"> there was considerable variability in annual UTB </a> <a title="The CPA Journal - April 2014 page 52" href="http://viewer.zmags.com/publication/bce2f8b9?page=52"> TAXATION fraud Aiding </a> <a title="The CPA Journal - April 2014 page 53" href="http://viewer.zmags.com/publication/bce2f8b9?page=53"> parers to understand and follow applicable Intern</a> <a title="The CPA Journal - April 2014 page 54" href="http://viewer.zmags.com/publication/bce2f8b9?page=54"> accounting services, in the court’s opinion: </a> <a title="The CPA Journal - April 2014 page 55" href="http://viewer.zmags.com/publication/bce2f8b9?page=55"> (1) In preparing or assisting in the prepa- </a> <a title="The CPA Journal - April 2014 page 56" href="http://viewer.zmags.com/publication/bce2f8b9?page=56"> asked for oral explanations and did not request t</a> <a title="The CPA Journal - April 2014 page 57" href="http://viewer.zmags.com/publication/bce2f8b9?page=57"> “Dante DeMiro’s Fall Triggered by Tenacious Lapee</a> <a title="The CPA Journal - April 2014 page 58" href="http://viewer.zmags.com/publication/bce2f8b9?page=58"> TAXATION state & local taxation New York St</a> <a title="The CPA Journal - April 2014 page 59" href="http://viewer.zmags.com/publication/bce2f8b9?page=59"> choose to assess property at a portion of the mar</a> <a title="The CPA Journal - April 2014 page 60" href="http://viewer.zmags.com/publication/bce2f8b9?page=60"> reassessment, the town might be required to pay b</a> <a title="The CPA Journal - April 2014 page 61" href="http://viewer.zmags.com/publication/bce2f8b9?page=61"> community would have had an estimated total tax i</a> <a title="The CPA Journal - April 2014 page 62" href="http://viewer.zmags.com/publication/bce2f8b9?page=62"> meetings, presentations, and communications, alon</a> <a title="The CPA Journal - April 2014 page 63" href="http://viewer.zmags.com/publication/bce2f8b9?page=63"> if state funds were granted during the ini- tial </a> <a title="The CPA Journal - April 2014 page 64" href="http://viewer.zmags.com/publication/bce2f8b9?page=64"> FINANCE personal financial planning In-Plan </a> <a title="The CPA Journal - April 2014 page 65" href="http://viewer.zmags.com/publication/bce2f8b9?page=65"> AGI. The amount included in AGI could be as much </a> <a title="The CPA Journal - April 2014 page 66" href="http://viewer.zmags.com/publication/bce2f8b9?page=66"> MANAGEMENT succession planning Using an ESOP </a> <a title="The CPA Journal - April 2014 page 67" href="http://viewer.zmags.com/publication/bce2f8b9?page=67"> partners, as long as such plans comply with IRC s</a> <a title="The CPA Journal - April 2014 page 68" href="http://viewer.zmags.com/publication/bce2f8b9?page=68"> Professional service corporation share- holder</a> <a title="The CPA Journal - April 2014 page 69" href="http://viewer.zmags.com/publication/bce2f8b9?page=69"> </a> <a title="The CPA Journal - April 2014 page 70" href="http://viewer.zmags.com/publication/bce2f8b9?page=70"> RESPONSIBILITIES & LEADERSHIP ethics </a> <a title="The CPA Journal - April 2014 page 71" href="http://viewer.zmags.com/publication/bce2f8b9?page=71"> close the matter to the entity’s external auditor</a> <a title="The CPA Journal - April 2014 page 72" href="http://viewer.zmags.com/publication/bce2f8b9?page=72"> action. Section 10A further provides that if audi</a> <a title="The CPA Journal - April 2014 page 73" href="http://viewer.zmags.com/publication/bce2f8b9?page=73"> N.Y.S.2d 561 (1st Dept. 2005), which notes that a</a> <a title="The CPA Journal - April 2014 page 74" href="http://viewer.zmags.com/publication/bce2f8b9?page=74"> TECHNOLOGY what to bookmark Website of </a> <a title="The CPA Journal - April 2014 page 75" href="http://viewer.zmags.com/publication/bce2f8b9?page=75"> ter meet their information needs with respect to </a> <a title="The CPA Journal - April 2014 page 76" href="http://viewer.zmags.com/publication/bce2f8b9?page=76"> CLASSIFIEDMARKETPLACE PROFESSIONAL OPPORTUNITY l</a> <a title="The CPA Journal - April 2014 page 77" href="http://viewer.zmags.com/publication/bce2f8b9?page=77"> CLASSIFIED Established Great Neck CPA firm, peer </a> <a title="The CPA Journal - April 2014 page 78" href="http://viewer.zmags.com/publication/bce2f8b9?page=78"> CLASSIFIED SALES TAX, ISAAC STERNHEIM & CO. Sales</a> <a title="The CPA Journal - April 2014 page 79" href="http://viewer.zmags.com/publication/bce2f8b9?page=79"> CLASSIFIED </a> <a title="The CPA Journal - April 2014 page 80" href="http://viewer.zmags.com/publication/bce2f8b9?page=80"> CLASSIFIED Ad</a> <a title="The CPA Journal - April 2014 page 81" href="http://viewer.zmags.com/publication/bce2f8b9?page=81"> ECONOMIC & MARKET DATA monthly u</a> <a title="The CPA Journal - April 2014 page 82" href="http://viewer.zmags.com/publication/bce2f8b9?page=82"> EDITORIAL a message from the editor-in-chief </a> <a title="The CPA Journal - April 2014 page 83" href="http://viewer.zmags.com/publication/bce2f8b9?page=83"> </a> <a title="The CPA Journal - April 2014 page 84" href="http://viewer.zmags.com/publication/bce2f8b9?page=84"> </a>