Smith Dickson, An Accountancy Corporation 

August 2012

Firm News

Smith Dickson Passes Peer Review with "Flying Colors!"

Smith Dickson is pleased to announce the successful completion of the independent peer review of our accounting, consulting and auditing practice.  Karen Reed, Senior Manager, led our team working with the outside auditors.  Peer review is a periodic outside review, performed by another accounting firm, of a firm's quality control system in accounting and/or auditing. Peer reviews are intended to maintain and improve the quality of the accounting and auditing services performed by firms.
 

Our continued participation in periodic peer reviews and our membership in the AICPA and CalCPA demonstrate Smith Dickson's commitment to quality and high standards for client services.  We are proud of our peer review results and would be happy to discuss any questions you may have. 
 
J. Reuben Clark Law Society Appoints Dickson to Board
Deborah Dickson, CPA, CFF, CFFA has been appointed has the first non-attorney on the board of the J. Reuben Clark Law Society.  Her title is Chief Financial Advisor.  The society is a unique affiliate of the Orange County Bar Association, emphasizing the relationship between law and ethics, morality, and religion.  

Speech at Banking Import/Export Conference   

Ryan Nguyen, Senior Accountant, and Deborah Dickson, President, recently spoke at an Import/Export conference sponsored by the SBA (Small Business Administration) and GBC International Bank.  Their presentation, "Keeping Your Banker Happy While Minimizing Your Taxes," discussed ways to present healthy financial statements in accordance with GAAP while simultaneously legally reducing income for tax purposes.

Recent Engagement: Litigation Support - Embezzlement Case

In a recent engagement for a high profile non-profit organization, Smith Dickson was asked to quantify the amount of funds embezzled by the Chief Financial Officer.  Our firm was successful in following the money trail using forensic accounting methods and uncovering embezzlement of greater than $1,000,000. 

The CFO had managed to hide the stolen funds via activities in the general and trust bank accounts by paying a fake vendor.  Smith Dickson provided expert consultation in mediation.  Working in conjunction with the non-profit's law firm, we were able to not only prove the embezzlement but work with the attorneys to achieve 100 percent recovery of all funds via insurance and restitution from the defendant.

Article: The Taxes and Bank Loan Quandary

It is a common problem for the entrepreneurial business - ownership wants to pay as little as legally possible in taxes, while at the same time companies' banks need to see profitability to satisfy lending criteria.  A good accountant can often help management identify and utilize a number of tax breaks.  The company is "all smiles" until it goes to the bank and asks for a loan, showing tax returns with little profit or even heavy losses - and is then turned down for the loan.  So what can be done to make the banker happy?  Click here for article.

Employers: New DOL Rules on Retirement Plan Fee Disclosure 

This summer, new Department of Labor (DOL) regulations are pulling back the curtain on the fees paid to a host of service providers by retirement plan sponsors (employers) and the employees who participate in those plans.  These fee disclosures provide plan sponsors with a new level of detail beyond what they had previously seen.  Along with these new disclosure rules come new responsibilities for plan administrators.

 

Under the DOL's 408(b)(2) regulation, whose due date was July 1, covered plan providers were to distribute fee disclosure documents to plan sponsors; it also requires that plan fiduciaries (plan sponsors) ensure that the fees paid to vendors are reasonable utilizing benchmarking and other methods. Under 404(a)(5), plan sponsors have 60 days from the date of disclosure to disclose fee information in turn to plan participants (August 30, 2012 is the deadline).

 

A "covered plan" is defined as an ERISA employee pension benefit plan or a pension plan, which includes all types of qualified retirement plans (401(k), profit sharing, defined benefit pensions, etc.).

 

What is your situation?

Are you fully informed of the fees for your company's plan? Are they reasonable? If you are a plan sponsor, make sure that you are up-to-date on the new regulations and have done your due diligence in disclosure of fees. Make sure you have reviewed and benchmarked your plan with your advisor.

 

For more information, see these articles:  "New Disclosure Requirements: Pull Back the Curtain on Retirement Plan Fees" and "How Retirement Plan Sponsors Can Avoid Turning 2012 Into Their Apocalypse" or go to the DOL website.

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ABOUT SMITH DICKSON

 

Smith Dickson is a full-service Southern California CPA firm that specializes in providing high-quality services designed to create long-term value for our clients. Our services include accounting, tax compliance and planning, litigation support, business consulting and estate/trust tax compliance. Please contact us with your questions.

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Smith Dickson, An Accountancy Corporation | 18100 Von Karman Avenue | Suite 420 | Irvine | CA | 92612