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MANUFACTURING & WHOLESALE DISTRIBUTION INDUSTRY NEWS
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| January/February 2017 |
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BEAM International 2.0 Export Promotion Grant -
DEADLINE: March 10, 2017
The BEAM International 2.0 Export Promotion Program provides grants up to $5,000 to qualifying companies for services to begin or expand export activity. Services covered under the grant include market research, trade shows, trade missions, customized international business agenda, optimization of website for international traffic, translation, and more. The application process is open through March 10, 2017. The BEAM International 2.0 Export Promotion Program is made possible with a grant from JPMorgan Chase Foundation.
Eligible companies must have been in business for at least one year, have a minimum of 10 full-time employees, and meet the SBA definition of a small business.
To apply for the program or for additional information, please click
here.
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IRS Alert: New W-2 Phishing Scam is "Dangerous"
The Internal Revenue Service, state tax agencies and the tax industry issued an urgent alert today to all employers that the Form W-2 email phishing scam has evolved beyond the corporate world and is spreading to other sectors, including school districts, tribal organizations and nonprofits. In a related development, the W-2 scammers are coupling their efforts to steal employee W-2 information with an older scheme on wire transfers that is victimizing some organizations twice.
Here's how the scam works: Cybercriminals use various spoofing techniques to disguise an email to make it appear as if it is from an organization executive. The email is sent to an employee in the payroll or human resources departments, requesting a list of all employees and their Forms W-2. This scam is sometimes referred to as business email compromise (BEC) or business email spoofing (BES). In the latest twist, the cybercriminal follows up with an "executive" email to the payroll or comptroller and asks that a wire transfer also be made to a certain account. Although not tax related, the wire transfer scam is being coupled with the W-2 scam email, and some companies have lost both employees' W-2s and thousands of dollars due to wire transfers.
"This is one of the most dangerous email phishing scams we've seen in a long time. It can result in the large-scale theft of sensitive data that criminals can use to commit various crimes, including filing fraudulent tax returns. We need everyone's help to turn the tide against this scheme,"' said IRS Commissioner John Koskinen.
For more details please click here or contact Mike Cameron, CPA at 800.880.7800, ext 1394, [email protected].
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Manufacturing and Capital Investment Strategies: Tax Considerations
Manufacturing companies often make major capital investments, such as expanding, moving, or improving their facilities without considering the tax implications of these investments. If manufacturers included tax planning in their capital investment strategies, they could significantly reduce the time that it takes them to recover their investments. Further, companies looking to move operations into a new state or locality have real bargaining power. Negotiating with the state or local governing bodies could produce tax credits and incentives through discretionary grant awards, infrastructure development support, or statutory incentives.
Another way that manufacturers are reducing their tax burden from capital investments is to take advantage of a cost segregation study on their buildings. Cost segregation studies benefit taxpayers by separating short-lived personal property from longer-lived real property. By separating these assets, the company is able to accelerate depreciation which lowers taxable income.
To read the full article by Chris Atwell, Jeff Knapp, and Sherri York, click here or contact Aaron Wilzbacher, CPA at 800.880.7800 ext 1322, [email protected].
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Memo to Manufacturers: What Are You Doing Differently This Year?
"What can we be doing differently?" This is the question that many manufacturers are asking themselves as 2017 begins. Many manufacturers are wondering where growth will come from going forward as well as when price pressures will ease. Because there is no easy answer to these questions, it is important to evaluate all areas to improve upon in 2017. Some areas manufacturers should consider include: evaluating the consolidation of operations, reducing inventory levels, leveraging technology, evaluating location, international expansion, hedging, sales structure, and innovation.
For more details from Steve Menaker's article, click here or contact Brant Kennedy, CPA at 800.880.7800 ext 1425, [email protected].
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Revenue Recognition and Leases New Accounting Standards
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). This standard outlines a single comprehensive model for companies to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The core principle of the revenue model is that revenue is recognized when a customer obtains control of a good or service. A customer obtains control when it has the ability to direct the use of and obtain the benefits from the good or service. Transfer of control is not the same as transfer of risks and rewards, as per current guidance. An entity will also need to apply new guidance to determine whether revenue should be recognized over time or at a point in time.
In August 2015, the FASB issued ASU 2015-14, which defers the effective date of ASU 2014-09 one year. Public business entities will apply the guidance to annual reporting periods beginning after December 15, 2017 (applicable to the December 31, 2018 year for a calendar year entity). All other entities will apply the guidance to annual reporting periods beginning after December 15, 2018 (applicable to the December 31, 2019 year for a calendar year entity).
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. The standard is effective on January 1, 2019 for public business entities and on January 1, 2020 for all other entities, with early adoption permitted.
For more information, contact Brant Kennedy, CPA at 800.880.7800 ext 1425, [email protected].
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ABOUT OUR MANUFACTURING & WHOLESALE DISTRIBUTION INDUSTRY TEAM
From increased competition and continuous quality improvement demands to rising employee benefit costs and declining margins, manufacturers and wholesale distributors are facing greater challenges than ever before. In addition to the services you would expect from an accounting firm, we have a dedicated team ready to assist you with the unique challenges and issues facing your industry.
A number of our staff members belong to The Association for Operations Management (APICS) with some having achieved the CPIM and CIRM certifications. We understand your key issues and possess the drive and determination to help you manage your company on a proactive basis. This commitment positions us at the cutting edge of the industry and enables us to spot trends and deal quickly with the issues your company may be facing. |
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SEE WHAT OUR CLIENTS ARE SAYING...
"From assistance with strategic planning to representing us during a tax audit, their insight has both saved us money and helped make our business even more successful. We have found Harding, Shymanski & Company to be extremely proactive and there to give us advice, even in advance. They are more than just an accounting firm... they are our trusted advisor.
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- Diane Fischer, President, L&D Mail Masters
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Disclaimer: The information contained in this email is for general guidance on matters of interest only. The publication does not, and is not intended to provide legal, tax or accounting advice.
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Harding, Shymanski & Company, P.S.C.
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