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Create a nonprofit executive search plan — before it becomes necessary

Selecting a new chief executive or other senior staffer is one of the most important decisions your nonprofit board is likely to face. Even if there’s no immediate hiring need, it’s smart to prepare for the process. 1. Form a search team Forming a search team allows participating board members to stay abreast of compensation […]

Private companies: Consider these financial reporting shortcuts

For years, private companies and their stakeholders have complained that the Financial Accounting Standards Board (FASB) catered too much to large, public companies and ignored the needs of smaller, privately held organizations that have less complex financial reporting issues. In other words, they’ve said that U.S. Generally Accepted Accounting Principles (GAAP) are too complicated for […]

Reporting collaborative activities: A complex issue for nonprofits

More and more nonprofits are joining forces to better serve their clients and cut costs. But such relationships can come with complicated financial reporting obligations. Starting with the simplest For accounting purposes, the simplest relationship between nonprofits may be a collaborative arrangement. These are typically contractual agreements in which two or more organizations are active […]

Don’t overlook tax apportionment when planning your estate

If you expect your estate to have a significant estate tax liability upon your death, be sure to include a well-thought-out tax apportionment clause in your will or revocable trust. An apportionment clause specifies how the estate tax burden will be allocated among your beneficiaries. Omission of this clause, or failure to word it carefully, […]

4 tough questions to ask before expanding to a new location

Is business going so well that you’re thinking about adding another location? Before you start planning the ribbon-cutting ceremony, take a step back and ask yourself some tough questions about whether a new location will grow your company — or stretch it too thin. Here are four to get you started: 1. What’s driving your […]

When does your nonprofit owe UBIT on investment income?

In recent years, the IRS has increased its scrutiny of nonprofits’ unrelated business income (UBI). Dividends, interest, rents, annuities and other investment income generally are excluded when calculating unrelated business income tax (UBIT). However, there are two exceptions where such income is taxable. 1. Debt-financed property When your nonprofit incurs debt to acquire an income-producing […]

We’ve got the lowdown on updated cash flow reporting guidance

Do you know how to categorize items on your statement of cash flows? Accounting Standards Update (ASU) No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, attempts to minimize diversity in cash flow reporting practices. 8 issues Accounting Standards Codification Topic 230, Statement of Cash Flows, provides guidance […]

Three midyear tax planning strategies for your business

Tax reform has been a major topic of discussion in Washington, but it’s still unclear exactly what such legislation will include and whether it will be signed into law this year. The last major tax legislation that was signed into law — back in December of 2015 — still has a significant impact on tax […]

Does your business have too much cash?

From the time a business opens its doors, the owner is told “cash is king.” It may seem to follow that having a very large amount of cash could never be a bad thing. But, the truth is, a company that’s hoarding excessive cash may be doing itself more harm than good. Liquidity overload What’s […]

Keep real estate separate from your business’s corporate assets to save tax

It’s common for a business to own not only typical business assets, such as equipment, inventory and furnishings, but also the building where the business operates — and possibly other real estate as well. However, there can be negative consequences when a business’s real estate is included in its general corporate assets. By holding real […]