The American Institute of Certified Public Accountants (AICPA) recently released its CPA Firm Top Issues Survey that took a look at “significant challenges facing practitioners.” But Rian Wilhite, of Peisner Johnson & Company LLP, says the AICPA survey should have focused instead on what issues keep leaders of CPA firms up at night.
For Wilhite that is “missing or understating some liability—some liability that isn't on the balance sheet, but should be”…such as nexus exposure.
To illustrate his point, Wilhite uses an example involving a CPA firm’s longtime client approached with a buyout offer. As part of the offer, the buyout firm “issued a nexus questionnaire to the company and discovered they had nexus for sales tax all across the nation based on the activities of independent sales reps,” Wilhite writes. The potential liability, for the past three years? Roughly $15 million, according to Wilhite. Understandably so, the CPA firm, which had been giving the company “giving clean opinions all along for the last 30 years, had “palpitations,” Wilhite notes.
“Thankfully, all’s well that ends well and this situation was resolved satisfactorily because of a series of actions including taking advantage of the SSTP amnesties and strategic voluntary disclosures,” Wilhite writes.
Given the number of developments on the sales tax nexus front in recent months, his example is a timely, cautionary tale for practitioners everywhere.
In other developments,
Nexuspocolypse, nexusmageddon, nexusapalooza… Daniel De Jong of the Tax Executives Institute, Inc. ponders these titles as he reviews Connecticut’s new economic nexus rule.
For an in-depth look at cloud computing, check out a new article written by Kendall Houghton and Maryann Luongo, both with Alston & Bird.
The Tax Foundation’s Laura Lieberman reports on how the Texas “Pole Tax” failed to live up to expectations.
Philip M. Tatarowicz has joinedState and Local Tax practice at the Washington, D.C. office of Morrison & Foerster LLP.
By Priya D. Nair
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)