careIn 2017 my Website was migrated to
the clouds and reduced in size.
Hence some links below are broken.
One thing to try if a “www” link is broken is to substitute “faculty” for “www”
For example a broken link
http://www.trinity.edu/rjensen/Pictures.htm
can be changed to corrected link
http://faculty.trinity.edu/rjensen/Pictures.htm
However in some cases files had to be removed to reduce the size of my Website
Contact me at rjensen@trinity.edu if
you really need a file that is missing
Bob Jensen's Bookmarks
Accounting, Finance, and Business Section
Bob
Jensen at Trinity University
Bob Jensen's Tidbits ---
http://faculty.trinity.edu/rjensen/TidbitsDirectory.htm
For
earlier editions of Fraud Updates go to
http://faculty.trinity.edu/rjensen/FraudUpdates.htm
For earlier editions of New Bookmarks go to
http://faculty.trinity.edu/rjensen/bookurl.htm
Bookmarks for the World's Library ---
http://faculty.trinity.edu/rjensen/bookbob2.htm
Index
(Scroll down to view categories and bookmarks)
Daily News Sites for Accountancy, Tax,
Fraud, IFRS, XBRL, Accounting History, and More ---
http://faculty.trinity.edu/rjensen/AccountingNews.htm
O'Keefe Accounting Library Searches
http://library.sau.edu/bestinfo/Majors/Accnt/accindex.htm
You can order back issues or relevant links management and accounting
books and journals from MAAW ---
http://maaw.info/
TOEFL Test Practice Sets ---
http://www.testpreppractice.net/TOEFL/Default.aspx
Large International Accounting Firm History ---
http://en.wikipedia.org/wiki/Big_Four_auditors
Accounting News, Blogs, Tweets, etc. ---
http://faculty.trinity.edu/rjensen/AccountingNews.htm
PwC's Website for College and University
Faculty ---
Click Here
Gerald
Trite's great set of links --- http://iago.stfx.ca/people/gtrites/Docs/bookmark.htm
Richard
Torian's Managerial Accounting Information Center --- http://www.informationforaccountants.com/
Accounting Standards
Databases:
Fee-Based Accounting Knowledge Vortals for Most Developed
Nations and International Standards
Daily News Sites for Accountancy, Tax,
Fraud, IFRS, XBRL, Accounting History, and More ---
http://faculty.trinity.edu/rjensen/AccountingNews.htm
Accounting History Libraries at the University of Mississippi (Ole Miss) ---
http://www.olemiss.edu/depts/accountancy/libraries.html
The above libraries include international accounting history.
The above libraries include film and video historical collections.
MAAW Knowledge Portal for Management and Accounting ---
http://maaw.info/
Academy of Accounting Historians and the Accounting Historians Journal ---
http://www.accounting.rutgers.edu/raw/aah/
Richard
Torian's Managerial Accounting Information Center ---
http://www.informationforaccountants.com/
O'Keefe Accounting Library Searches
http://library.sau.edu/bestinfo/Majors/Accnt/accindex.htm
PwC's Website for College and University
Faculty ---
Click Here
Services Offered by Professional
Accounting Firms (including how to find them) --- http://faculty.trinity.edu/rjensen/fees.htm#ServicesOffered
Accounting topic search helpers --- http://faculty.trinity.edu/rjensen/searchh.htm#Accounting
| e-Commerce
|
Bob Jensen's Archives of New Bookmarks ---
http://faculty.trinity.edu/rjensen/Bookurl.htm
Bob Jensen's Tidbits Blog ---
http://faculty.trinity.edu/rjensen/TidbitsDirectory.htm
Bob Jensen's Updates on Fraud ---
http://faculty.trinity.edu/rjensen/FraudUpdates.htm
Links to Documents on Fraud ---
http://faculty.trinity.edu/rjensen/Fraud.htm
Bob Jensen's search helpers are at http://faculty.trinity.edu/rjensen/searchh.htm
Bob Jensen's Bookmarks ---
http://faculty.trinity.edu/rjensen/bookbob.htm
Bob Jensen's links to free electronic literature, including free online
textbooks ---
http://faculty.trinity.edu/rjensen/ElectronicLiterature.htm
Bob Jensen's links to free online video, music, and other audio ---
http://faculty.trinity.edu/rjensen/Music.htm
Bob Jensen's documents on accounting theory are at http://faculty.trinity.edu/rjensen/theory.htm
Bob Jensen's links to free course materials from major universities ---
http://faculty.trinity.edu/rjensen/000aaa/updateee.htm#OKI
Bob Jensen's links to online education and training alternatives around
the world ---
http://faculty.trinity.edu/rjensen/Crossborder.htm
Bob Jensen's links to electronic business, including computing and
networking security, are at
http://faculty.trinity.edu/rjensen/ecommerce.htm
Bob Jensen's links to education technology and controversies ---
http://faculty.trinity.edu/rjensen/000aaa/0000start.htm
Bob Jensen's home page ---
http://faculty.trinity.edu/rjensen/
A Government Website for Helpers in Personal
Finance
MyMoney.gov is the U.S. government's website dedicated
to teaching all Americans the basics about financial education. Whether you are
planning to buy a home, balancing your checkbook, or investing in your 401k, the
resources on MyMoney.gov can help you do it better. Throughout the site, you
will find important information from 20 federal agencies government wide.
My Money.gov ---
http://www.mymoney.gov/
The AICPA's Financial Literacy Helper Site ---
http://www.360financialliteracy.org/
Damodaran Online: A Great Sharing Site from a Finance Professor at New
York University and Textbook Writer ---
http://pages.stern.nyu.edu/%7Eadamodar/
Jim Mahar's finance sharing site (especially note his great blog
link) ---
http://financeprofessor.com/
Financial Rounds from an anonymous finance professor ---
http://financialrounds.blogspot.com/
Bob Jensen's helpers for small business
are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#SmallBusiness
DealBook is a financial news service
produced by The New York Times.
It is published daily, Monday-Friday, except on U.S. Market holidays and
during the last week of the year. A daily digest of DealBook is also
available via email, delivered before the market opens.
The New York Times ---
http://dealbook.blogs.nytimes.com/
Help for the younger generation's planning
ahead for their financial futures
"A Glimpse of the Future: Savings and asset accumulation among Americans
25–34," Journal of Accountancy, January 2007 ---
http://www.aicpa.org/pubs/jofa/jan2007/special2.htm
Also see
http://faculty.trinity.edu/rjensen/fees.htm
Corporate Financial Reports
O'Keefe Accounting Library Searches
http://library.sau.edu/bestinfo/Majors/Accnt/accindex.htm
Updates and issues in the accounting, finance, and business scandals --- http://faculty.trinity.edu/rjensen/fraud.htm
Bob Jensen's
threads on accounting practice, consultation, and financial planning are at http://faculty.trinity.edu/rjensen/fees.htm
Bob Jensen's Threads on Return on Business Valuation, Business
Combinations,
Investment (ROI), and Pro Forma Financial Reporting --- http://faculty.trinity.edu/rjensen/roi.htm
e-Commerce and e-Business Helpers for Accountants --- http://faculty.trinity.edu/rjensen/ecommerce.htm
Bob Jensen's helpers for small businesses are
at http://faculty.trinity.edu/rjensen/bookbob1.htm#SmallBusiness
Public Accounting Report has
published its annual ranking of America's Top 100 Accounting Firms, and it's
no surprise that Andersen, last year's number five ranked firm, is no longer
on the list. http://www.accountingweb.com/item/95611
- PricewaterhouseCoopers:
$8,056.5 million
- Deloitte &
Touche: $6,130 million
- Ernst &
Young: $4,485 million
- KPMG: $3,171
million
- Grant
Thornton: $432.5 million
- BDO Seidman:
$353 million
- BKD: $210.9
million
- Crowe, Chizek
& Co.: $204.7 million
- McGladrey
& Pullen: $203 million
- Moss Adams:
$163 million
"Second Six: Ready to Step Up?" CFO.com --- http://www.cfo.com/specialreport/0,5487,564||A,00.html
As contributing editor Ed Zwirn reveals in his
article ''The
Second Six: Ready to Step Up?'', the demise of Andersen and the
advent of Sarbanes-Oxley have not been an unqualified blessing for those
firms that remain. And in ''Same
Straw, Smaller Back,'' Zwirn notes how new regulatory burdens that
fall heavily on smaller companies (the usual Group B clients) may persuade
many of them to go private.
Accounting Professional Site Links
The CPA Team http://www.cpateam.com/
An E-ssential Site --- http://www.el.com/
CPAs, financial analysts, small business owners, and tax professionals not
only can find links to many Web sites in their fields here, but also can use
Essential Link’s home page to access online calculators, clocks, e-mail
services, encyclopedias and dictionaries. Users can find links to online
news, newspaper and television network Web sites in the Headlines area, as
well as links to Internet search engines..
PwC's Website for College and University Faculty ---
Click Here
In
March 2000 Forbes named AccountantsWorld.com as the Best Website on
the Web --- http://accountantsworld.com/.
Some top accountancy links --- http://accountantsworld.com/category.asp?id=Accounting
Another leading accounting site
is AccountingEducation.com at http://www.accountingeducation.com/
What is happening in selected industries?
Valuation Resources --- http://www.valuationresources.com/IndustryReport.htm
This is a helpful Website for researchers and practitioners.
Industry Resources Reports
Industry Resources Reports list resources
available from trade associations, industry publications, and research
firms which address subjects such as industry overview, issues, trends,
and outlook, financial benchmarking, compensation surveys, and valuation
resources.
Each entry in a category contains the name of the
source organization, the name of the particular resource, a hyperlink to
the source organization website, a brief description of the resource, and
a description of any information that is provided free online. The user
can check the website or contact the source organization for additional
information and product pricing. In some cases, the resource may not be
available on the website but can be obtained by calling the source
organization using the phone number provided on the website.
One of the many industries covered is SIC 8721
Accounting, Auditing, and Bookkeeping Services
http://www.valuationresources.com/Reports/SIC8721AccountingAuditingandBookkeepingServices.htm
Accounting Services
http://industryprofiles.1stresearch.com/
Each industry profile includes industry overview, key questions, trends and
developments, threats and challenges, opportunities, news and media information,
financial information, and web site links. Sample report available; individual
industry profiles can be purchased online. Also available on subscription basis.
Bureau of Labor Statistics, U.S.
Department of Labor
Occupational Outlook Handbook - Accountants & Auditors
http://www.google.com/search?hl=en&q=occupational+outlook+handbook
This site describes the nature of the industry, working conditions, employment,
occupations in the industry, training and advancement, earnings and benefits,
employment outlook, and lists of organizations that can provide additional
information. Available free online.
Industry Growth Outlook Report
http://www.integrainformation.com
Report provides 5 years of historical and forecast industry revenue growth
information. Also includes historical and forecast macroeconomic indicators. Covers
over 900 SIC codes. Individual reports can be purchased online.
Marketing
Research Profile
http://www.bizminer.com/index.asp?aid=78
Profiles provide market research by industry segment on a national and
local level for 250 metropolitan areas. Includes market volume and
number of firms, sales trends, sales per employee, staffing and employment
trends, startup activity, failures rates, and new branch development.
Available for all SIC codes. Individual reports can be purchased online.
More Information
Other resources which cover a wide variety of industries are available at http://valuationresources.com/IndustryOutlook.htm.
Accountancy Discussion Forums:
AECM (Educators) http://pacioli.loyola.edu/aecm/
AECM is an email, Listserv list which provides
a forum for discussions of all hardware and software which can be
useful in any way for accounting education at the college/university
level. Hardware includes all platforms and peripherals. Software
includes spreadsheets, practice sets, multimedia authoring and
presentation packages, data base programs, tax packages, World Wide
Web applications, etc |
CPAS-L
(Practitioners) http://pacioli.loyola.edu/cpas-l/
CPAS-L provides a forum for discussions of all
aspects of the practice of accounting. It provides an unmoderated
environment where issues, questions, comments, ideas, etc. related
to accounting can be freely discussed. Members are welcome to take
an active role by posting to CPAS-L or an inactive role by just
monitoring the list. You qualify for a free subscription if you are
either a CPA or a professional accountant in public accounting,
private industry, government or education. Others will be denied
access. |
Yahoo
(Practitioners)
http://groups.yahoo.com/group/xyztalk
This
forum is for CPAs to discuss the activities of the AICPA. This can
be anything from the CPA2BIZ portal to the XYZ initiative or
anything else that relates to the AICPA. |
AccountantsWorld
http://accountantsworld.com/forums/default.asp?scope=1
This site hosts various discussion groups on such topics as
accounting software, consulting, financial planning, fixed assets,
payroll, human resources, profit on the Internet, and taxation. |
Business Valuation Group BusValGroup-subscribe@topica.com
This discussion group is headed by Randy Schostag [RSchostag@BUSVALGROUP.COM] |
Jack Anderson's Accounting Information Finder --- http://www.umsl.edu/~anderson/accsites.htm
Globalization
Strategic Alliances Roundtable (GSAR), Berlin, Germany, June 22, 2001 --- http://www.cs.trinity.edu/~rjensen/GSAR2001/000start.htm
| e-Commerce
|
From the SEC: All About
Auditors --- http://www.sec.gov/investor/pubs/aboutauditors.htm
What investors need to know!
SEC Warnings to Investors --- http://www.sec.gov/investor/pubs.shtml
Financial Education for Teachers: The Federal Reserve Bank of
Minneapolis ---
http://www.minneapolisfed.org/community_education/teacher/
SEC's Interactive Tools for
Investors ---
http://www.sec.gov/investor/tools.shtml
Here are several interactive tools
to help you with your investment decisions:
Here are several
calculators to help you with your investment decisions:
|
Contract Congress --- http://capwiz.com/fei/home/
How
to find an organization
Businesses
Hoovers Business Finder --- http://premium.hoovers.com/subscribe/
http://www.business.com/
http://dir.yahoo.com/Business_and_Economy/Directories/
Not-for-Profit Organizations
International Center for
Not-for-Profit Law --- http://www.icnl.org/
How to check on a charity or church before you donateSearchable Database
2005/2006 Compensation of Presidents of Private Institutions ---
http://www.insidehighered.com/news/2007/12/31/qt
Searchable Database
Compensation of Presidents of Higher Education Institutions ---
http://chronicle.com/stats/990/
How to check on a charity or church or college before you donate:
You can begin with IRS Form 990 disclosures, but these sometimes may be more misleading than helpful.
You can access them from Guidestar at http://www.guidestar.org/index.jsp
One problem is that reported "compensation" for executives may not include free houses, free cars, and free services like lawn care and catering.
Another problem is that rich alumni may provide college executives with free condo use, airline tickets, and club memberships.
Guidestar also provides salary disclosures for top executives in the non-profit organization.
However, funds can (such as charity crooks) can be diverted by cheats in other ways.
Research Tools
Analyst Reports
Charity Check
Grant Explorer
Data Services
Nonprofit Compensation Reports
Salary Search
"Giving Freely—And Wisely: One site names preachers who may
be misusing money and suggests that you 'prayerfully' consider giving to
other ministries instead," Jane Bryant Quinn, Newsweek, December 18,
2006, Page 51 ---
http://www.msnbc.msn.com/id/16127630/site/newsweek/
Unfortunately, you can't always believe what
the (IRS Form) 990 says. It's supposed to
show how much the nonprofit spends on actual services, as opposed to
fund-raising and administration. But the law isn't much enforced. In a
report covering part of the 1990s, the General Accounting Office found
that 64 percent of public charities claimed to have
zero—zero!—fund-raising expenses. Do you believe that? Neither do I.
Some of the rating
services adjust for these problems. Uncharitably, they often slam each
other's methods while touting their own. I'm a civilian in these wars,
so my advice is to look for good grades from every source. Start your
research here:
1. The Better Business Bureau Wise Giving
Alliance (Give.org). It currently posts reports on more than 900
nonprofits, testing them by a number of standards including good
governance. About 65 percent of them pass. The rest fail, or refuse to
be evaluated (a bad sign, no matter what excuse the charity gives).
2. American Institute of Philanthropy (CharityWatch.org).
It's the toughest of the bunch, rating more than 500 charities on a
scale of A+ down to F. Because it disregards certain, potentially
suspect, expenses and donations, it fails some nonprofits that the other
raters approve. Readers of this column can get its latest Charity Rating
Guide free from AIP, P.O. Box 578460, Chicago, IL 60657.
3. CharityNavigator.org rates 5,100 nonprofits
on a scale of zero to four stars. This site draws only from a
nonprofit's latest 990 form, which could mislead. But I like its Top Ten
lists, such as 10 Charities Overpaying Their For-Profit Fund-Raisers.
4. MinistryWatch.com rates more than 500
evangelical groups on a scale of 1 to 5 stars. It's an ardent advocate
for financial disclosure. The site names preachers who may be misusing
money and suggests that you "prayerfully" consider other ministries
instead. Withholding that advice, says MinistryWatch.com, would be
"tantamount to condoning sin." Hear, hear.
5. The Evangelical Council for Financial
Accountability (Ecfa.org) accredits Evangelical churches and charities
based on such standards as audited financial reports and ECFA's own
field reviews. If your group hasn't joined (or is on the lists of those
that left) you should ask why. There's no comparable service for Jewish,
Muslim or Catholic organizations.
You'll find other sources. GuideStar.org gives
no ratings, just access to 990s for nearly 700,000 charities.
Pennsylvania's Department of State lists nonprofits that ran into
trouble there. They may be fund-raising in other states.
Still, most people donate simply because
someone asks them to, says William Meehan, chair of Philanthropic
Research, parent of GuideStar. Charity ratings haven't had much impact,
because they're flawed and not enough people follow them. Besides, the
ratings don't help you choose among similar charities. For that, you
need to know how well they do their jobs. That's the next step—and a new
Web site should help it along. Watch for GreatNonprofits.org, launching
next spring. People familiar with specific charities—clients, donors,
staff and volunteers—will be able to post opinions there, for you to
read before you decide to give.
Continued in article
Bob Jensen's threads on reporting fraudulent charities are at
http://faculty.trinity.edu/rjensen/FraudReporting.htm#CharityFrauds
The Securities and Exchange Commission (SEC) and the
North American Securities Administrators Association (NASAA) have announced the
launch of a new Web site designed to provide information about money managers,
financial planners, and other investment advisors.
http://www.accountingweb.com/item/59363
************************************************************************************
Fee-Based Accounting Knowledge Vortals and Standards Databases
Accounting Standards Databases Arthur
Andersen's Accounting Research Manager (after a free 30-day trial,
the cost is over $2,000 per year for a single user) --- http://www.arm.arthurandersen.com
Academic pricing is not mentioned at the Web site, but some
universities might possibly negotiate lower pricing.
Accounting
Research ManagerTM is a comprehensive financial reporting
knowledgebase that provides materials designed to help solve your
most pressings issues. Continually updated, it is the most timely,
complete, interpretive resource for your financial reporting needs.
After Andersen imploded,
its Research Manager was sold to Aspen Corporation and later
resold to CCH.---
http://www.accountingresearchmanager.com/ARMMenu.nsf/vwHTML/ARMSplash?OpenDocument
March 30, 2006 message from
Susan.Lawless@wolterskluwer.com
Accounting Research
Manager is designed to handle the two most difficult
research issues facing accounting professionals.
First, the Standard Setter’s literature is not cross
referenced. They do not “talk” to one another. Making sure
you look at all the relevant literature is not easy.
Second, guidance is helpful after reading the literature,
“what are the rule makers really saying?”
Accounting
Research Manager
is organized to resolve those two issues by pulling all the
literature on a specific topic together in one place along
with providing world class guidance on those issues - all in
the same place. This is the reason why 60% of the top 100
accounting firms, 200 of the Fortune 500 corporations and
the SEC use our service.
Below I have included an outline of the content. I have
also attached a brochure that provides additional detail.
Accounting Research
Manager includes all U.S. and IASB authoritative, and
proposal-stage literature:
-- Rules,
regulations and releases of the 1933 and 1934 Acts,
Financial Reporting Releases, Accounting and Auditing
Enforcement Releases, Staff Accounting Bulletins, Staff
Legal Bulletins, Staff speeches, SEC releases of final
and proposed rule changes and much more.
-
FASB
-- Statements and interpretations, technical bulletins,
special reports, implementation guides and related
proposal-stage literature. The amended FASB’s are
included along with the original pronouncements.
-
EITF
-- EITF Flash Reports, Abstracts, Minutes and Issues
Summaries.
-
PCAOB
--- Rules and Regulations (proposed and
final).
-
AICPA
-- Professional Standards, including full text of
SAS’s, Accounting Research Bulletins, APB
Opinions, Accounting Statements of Position, Audit and
Accounting Guides, Practice Bulletins, Accounting
Interpretations, Issues Papers and related
proposal-stage literature.
-
IASB
-- Accounting standards, Standing Interpretations
Committee (SIC) materials and related proposal-stage
literature.
-
GASB --
Statements, interpretations, technical
bulletins, Staff implementation guides and proposal
stage literature.
-
GAO --
Government Auditing Standards and Financial
Audit Manual.
-
OMB –
Circulars and Compliance Statements.
A partial list of practice aids and tools included in
Accounting Research Manager:
- A weekly summary delivered
every Friday via e mail directly into your inbox
summarizing the week’s top GAAP. GAAS, auditing, SEC and
GASB changes. Linked to the authoritative literature.
-
A rolling
three month comprehensive checklist detailing all the
changes made by each Standard Setter linked to the
change.
-
Quarterly
updated checklists for GAAP and SEC filings linked to
the authoritative literature and highlighting the
changes that occurred during the quarter.
-
Miller
Disclosure manual with sample language.
-
A full book
devoted to the issue of Revenue Recognition.
-
Five additional
books, online, each over 300 pages covering the
following topics: leases, financial assets,
derivatives, business combinations and stock
compensation.
-
Accounting Standards – the one place where all the
authoritative literature is linked together by topic
with detailed
interpretations.
I can provide a quick fifteen minute demo of the Accounting
Research Manager. Free trials are also available. I look
forward to your comments.
Thank you.
Sue Lawless
Account Manager, Research Products
CCH, a Wolters Kluwer business
1
(877) 741-6161 - new toll free office
1 (877) 741-6161 fax
susan.lawless@wolterskluwer.com
RIA offers a service
called Checkpoint ---
http://ria.thomson.com/integratedsolutions/
Checkpoint Benefits Expert Guidance – Checkpoint provides
authoritative analysis from RIA editors, world-renowned WG&L
authors and the best external content from partners such as BNA,
PPC, AICPA, PLI and WorldTrade Executive.
Research Efficiency – Checkpoint reduces time spent gathering
information with advanced research and analysis tools in a fully
integrated system.
Practice Development – Checkpoint provides practice development
tools to build an instant communication bridge between the
practitioner and the client, enhancing relationships and revenue
opportunities.
CPE –
CPE powered by MicroMash delivers a full year of CPE for you and
your organization, all in one specially-priced package.
Flexibility – Flexible contract terms, a choice of content and
features, and integrated links to cases, code, regulations,
expert analysis and related material from partners.
CPA Examination ---
http://en.wikipedia.org/wiki/Cpa_examination
Free CPA Examination Review Course ---
http://cpareviewforfree.com/
AccountingWeb Student Zone ---
http://www.accountingweb.com/news/student_zone.html
NASBA ---
http://en.wikipedia.org/wiki/Nasba
NASBA Video on How to Become a CPA ---
http://bit.ly/HowToBecomeACPA
CPA Examination
candidates and accounting faculty should check out the free database
at
http://www.cpa-exam.org/cpa/literature.htm
The Trinity University library has a single-user
license (with an academic discount) for PwC’s Comperio ---
http://www.pwcglobal.com/comperio
The single-user limitation really has not been problematic for us.
Our Library guru wrote some front end code that lets any Trinity
faculty member or student go directly into Comperio without having
to remember a password
Comperio
evolved out of a CD-Rom database that Price Waterhouse sold under
the name “Price Waterhouse Researcher.” Updated CDs were sent to us
each quarter in the old days before things were as networked on the
Web. Now it’s all Comperio on the Web.
Andersen
had a competing CD database called Research Manager. That was bought
out after Andersen fell, but I think it is now defunct (I could be
wrong about this).
Now
Comperio is the main commercial database available other than FARs
---
http://www.fasb.org/fars/
I think each student can buy this from Wiley, but there have been
numerous complaints about it.
PwC's Comperio Accounting
Research Manager
Comperio
is the most comprehensive on-line library of financial reporting
and assurance literature in the world. Over 1,500 financial
executives from around the world use Comperio on a daily basis.
Comperio content includes AICPA, DIG, EITF, FASB, IAS, ISB and the
SEC as well as pronouncements and standards from Australia,
Belgium, Canada, New Zealand and the United Kingdom.
With
Comperio, the answers you need are always available - right now,
right at your fingertips. There is no software to install - just
go to the Comperio website and start researching!
The
entire online library can be immediately accessed by browsing a
pronouncement or topic directly, or by searching the entire
database for key words, topics or terms.
Visit the
Comperio product information site at http://www.pwcglobal.com/comperio
. You will find the necessary forms to order Comperio today or to
request a 30-day free trial.
Andersen's old Accounting
Research Manager is now updated and maintained by CCH. The AICPA
has accounting research literature in the FARs database.
For national and
international accounting rulings and online research, it is best to
subscribe for a fee to one of the leading services shown below:
PwC Comperio
---
http://www.pwcglobal.com/comperio
CCH
Accounting Research Manager ---
http://www.accountingresearchmanager.com/ARMMenu.nsf/vwHTML/ARMSplash?OpenDocument
AICPA FARs (marketed by Wiley) ---
http://www.fasb.org/fars/
For looking up filings with
the SEC, there are two major sources:
EDGAR ---
http://www.sec.gov/edgar/quickedgar.htm
PwC EdgarScan ---
http://edgarscan.pwcglobal.com/servlets/edgarscan
It is possible to do
comparative company financial analyses using the core earnings
databases ---
http://faculty.trinity.edu/rjensen//theory/00overview/theory01.htm#CoreEarnings
Many IFRS and multiple
nation standards and reviews are available from Deloitte's IAS Plus
---
http://www.iasplus.com/index.htm
Free International
Auditing Standards
All documents issued by IFAC and the International Auditing
and Assurance Standards Board (IAASB) are now available for immediate download
at no charge. Visitors must simply fill out a one-time registration to gain
access to the documents. http://www.accountingweb.com/item/96952
From the AICPA
Overview of Certified in Financial Forensics (CFF) Credential
---
Click Here
http://www.aicpa.org/InterestAreas/ForensicAndValuation/Membership/Pages/Overview
Certified in Financial Forensics Credential.aspx
|
Internet Companies
Directory (A Partial Listing)
COMPANY |
DESCRIPTION |
URL |
e-Retail
(consumer products and services) |
1-800
Contacts |
Contact
lenses |
http://www.1800contacts.com/ |
Alloy
Online |
Goods
for teens |
http://www.alloy.com/ |
Amazon.com |
Books,
music, electronics |
http://www.amazon.com |
Autobytel.com |
New,
used car guide |
http://www.autobytel.com/ |
Barnesandnoble.com |
Books,
music |
http://www.barnesandnoble.com/ |
Drugstore.com |
Medical
products |
http://www.drugstore.com/ |
eBay |
Auctions |
http://www.ebay.com/ |
Egghead.com |
Computer
products |
http://www.egghead.com/ |
Expedia |
Travel
planning |
http://www.expedia.com/ |
Hotel
Reservations Network |
Discounted
hotel rooms |
http://www.180096hotel.com/ |
Priceline.com |
Travel
reservations |
http://www.priceline.com/ |
Stamps.com |
Postage |
http://www.stamps.com/ |
Ticketmaster |
Guides,
tickets |
http://www.ticketmaster.com/ |
Travelocity.com |
Travel
reservations |
http://www.travelocity.com/ |
e-Finance
(banks, brokerages and credit companies) |
Ameritrade |
Securities
broker |
http://www.ameritrade.com/ |
Charles
Schwab |
Securities
broker |
http://www.schwab.com/ |
CSFBdirect |
Securities
broker |
http://www.csfbdirect.com/ |
E-Trade |
Securities
broker |
http://www.etrade.com |
IndyMac
Bancorp |
Mortgage
lender |
http://www.indymacbank.com/ |
Intuit |
Personal
finance info |
http://www.intuit.com/ |
NetBank |
Consumer
banking |
http://www.gefn-compubank.com/ |
NextCard |
Consumer
credit |
http://www.nextcard.com |
TD
Warehouse |
Securities
broker |
http://www.tdwaterhouse.com/ |
Wit
SoundView |
Securities
broker |
http://www.witsoundview.com/ |
e-New
Media (advertising/subscription-supported media) |
AOL
Time Warner |
Consumer
content |
http://www.aoltimewarner.com/ |
Ask
Jeeves |
Search
engine |
http://www.ask.com/ |
Cnet
Networks |
Technology
content |
http://www.cnet.com/ |
HomeStore.com |
Real
estate content |
http://www.homestore.com/ |
HotJobs.com |
Career
content |
http://www.hotjobs.com/ |
InfoSpace |
Wireless
content |
http://infospace.com/ |
MarketWatch.com |
Financial
content |
http://cbs.marketwatch.com/ |
McAfee.com |
Computer
protection |
http://mcafee.com/ |
MP3.com |
Music
content |
http://www.mp3.com/ |
Multex.com |
Financial
content |
http://www.multexusa.com/ |
NBC
Internet |
Consumer
content |
http://www.nbci.com/ |
SportsLine.com |
Sports
content |
http://sportsline.com/ |
Terra
Lycos |
Consumer
content |
http://www.terralycos.com/ |
TheStreet.com |
Financial
content |
http://www.thestreet.com/ |
Apollo
Group U of Phoenix Online |
Education
content |
http://www.ipopros.com/histdeal_pla.asp?deal=2285 |
Yahoo |
Web
guide |
http://www.yahoo.com/ |
e-Access
providers (connections to the Internet) |
Aether
Systems |
Wireless
Internet access |
http://www.aethersystems.com/ |
Excite
At Home |
Internet
access |
http://www.excite.com/ |
EarthLink |
Internet
access |
http://www.earthlink.net/ |
Juno
Online Services |
Internet
access |
http://www.juno.com |
Metricom |
Wireless
Internet access |
http://www.metricom.com/
IMPORTANT NOTICE:
Please be advised that Metricom has filed for Chapter 11 bankruptcy
protection. |
NetZero |
Internet
access |
http://www.netzero.net/ |
Prodigy
Communications |
Internet
access |
http://www.prodigy.com/ |
RCN |
Internet
access |
http://www.rcn.com/ |
Research
in Motion |
Wireless
Internet access |
http://www.rim.net/ |
WorldGate
Communications |
Internet
access |
http://www.wgate.com |
Dr Jensen,
In your internet access directory you have listed e-Access
providers - none of these providers offer managed services...i.e. a
place to safely house your servers and storage with both physical
and internet security provided in addition to system administration
services and storage and backup services. If you ever add these to
your listing please consider including us, S4R ( www.s4r.com
) - we provide these services at the best prices around and give the
best service!
Thank you.
Jennie Enholm | S4R (760)804-8004 x113
|
e-Learning
providers (corporate) For more details go to http://faculty.trinity.edu/rjensen/000aaa/0000start.htm |
Caliber |
Training and
executive dev. |
http://www.caliber.com/ |
Pensare |
Executive development with plans for degree programs in
partnership with prestige universities |
http://www.pensare.com/ |
UNext |
Executive development and for-credit programs through
UNext's Cardean
University and in partnership with prestige universities |
http://www.unext.com/ |
Smart Force |
Executive development |
http://www.smartforce.com/ |
Quisic |
Content development, executive development, and
for-credit courses |
http://www.quisic.com/
(Formerly called University Access) |
Headlight (From
CyberU) |
Recreational learners and an online small business
training center |
http://www.cyberu.com/training/headlight/index.asp |
OnlineLearning.net |
Training and executive development and for-credit
courses |
http://www.onlinelearning.net/ |
University of Maryland University College |
Training and executive development and for-credit
courses |
http://www.umuc.edu/ |
Fathom (headed by Columbia University in conjunction
with many prestigious partners) |
A huge knowledge portal that offers over 600 courses |
http://www.fathom.com/index.jhtml |
New York University Online |
Training and executive development and for-credit
courses |
http://i5.nyu.edu/~jmm282/nyupage.html |
University of Phoenix |
Training and executive development and for-credit
courses (The largest accredited private university in the world.) |
http://www.phoenix.edu/index_open.html |
The Kaplan Colleges |
Training and executive development and for-credit
courses (including the online Concord School of Law) |
http://www.kaplancollege.com/ |
Sylvan Learning Systems |
Training and executive development and for-credit
courses (and testing centers) |
http://www.sylvan.net/ |
Intellnex from Ernst & Young (the first Big 5
accounting firm university) |
Training and executive development |
http://www.intellinex.com/flash/index.htm |
Many
other corporate providers are discussed in a book that can be
downloaded free:
The Business of Borderless Education, by S.C. Cunningham, et
al., (Australian Department of Education, Evaluations and
Investigations Programme of the Higher Education Division, 2000).
Hard Copy ISBN 0 642 44446 3 and Online Copy ISBN 0 642 44447 1 --- http://www.detya.gov.au/archive/highered/eippubs/eip00_3/bbe.pdf |
Worldwide Directory of Accountants and Consultants ---
http://www.searchsystems.net/list.php?nid=62
Bob Jensen's helpers on how choosing professional advice ---
http://faculty.trinity.edu/rjensen/fees.htm
Bob Jensen's documents on e-Learning are available free at http://faculty.trinity.edu/rjensen/000aaa/0000start.htm
(Note that most prestige universities have already or are forming
private corporations for online delivery of training, executive development,
and for-credit courses)
Bob Jensen's other bookmarks are
at http://faculty.trinity.edu/rjensen/bookbob.htm
When
searching for academic and business links, it is unfortunate if you forget to go
to the Baker Library at the Harvard Business School http://www.library.hbs.edu/
Rutgers University's Research &
Reference Gateway: Research Guides: Business
http://www.libraries.rutgers.edu/rul/rr_gateway/research_guides/busi/business.shtml
For example, the Accounting option
above leads you to the following links:
Page Contents:
August 2001 CPA
Journal's Chosen "Website of the Month"
Website of the
Month: My Accounting Portal My Accounting Portal ( www.myaccountingportal.com
) launched only in January, but its act seems to have been in good shape
from the get-go. Touting itself as combining “the best features of
consumer portals by giants such as Yahoo and Excite with the reference
tools and resources of a traditional accounting website” and including
“extensive customization technology, a wealth of original content,
powerful tools, and carefully screened links,” the “about us” page
does not overstate the case.
This portal
probably meets the criteria on anyone’s bookmark checklist. Features
include the following:
Customization.
Similar to general-user portals like Yahoo, a user can customize the main
page so favorite news feeds, research materials, and other resources are
readily available.
A user can
recustomize the layout at will.
Personal/professional
features. The portal has an accounting website module that provides a
range of accounting news and research and access to web-hosted
applications. The portal also offers general and business news, links to
websites in myriad areas, a personal information manager, stock quotes,
weather, and other modules. Editors’ top picks. The portal’s editors
select articles from listed websites they think will be most helpful to
accountants and organize them into convenient categories. Personal
information manager (PIM) and QuickMail. These areas contain the familiar
contacts, notes, calendar, task list, bookmarks, and e-mail functions,
available through a web-based interface for easy accessibility. Office
tools. The portal’s tools for doing business on the Internet include
basic telephone directories as well as collaboration tools for storing
data and sharing information electronically. Client interactivity. The
portal is developing a number of client-interactive features, such as
web-hosted applications, downloadable tax-returns, a tax due-date
calendar, a client scheduler, and time and billing functions. For
accountants that already have office management and PIM tools, My
Accounting Portal may offer more than needed. But the anywhere-anytime
advantage is a real one, the online research archives are impressive, and
the portal’s website listings are well organized.
************************************************************************************
The AICPA's Financial Literacy Helper Site ---
http://www.360financialliteracy.org/
Free Personal
Finance Blogs ---
http://pfblogs.org/blog/29
New blogging network for personal finance
From Jim Mahar's blog on January 22, 2006 ---
http://financeprofessorblog.blogspot.com/
"Five of the top Internet personal finance
bloggers today announced they have banded together to create a
first-of-its-kind personal finance blog network designed to put personal
finance wisdom, best practices and commentary just a mouse click away.
The new network, with headquarters online at
www.moneyblognetwork.com beginning
today, will be composed of the following top-performing personal finance
bloggers:
* JLP of AllThingsFinancial –
www.allthingsfinancialblog.com
* Jim of Blueprint for Financial Prosperity –
www.bargaineering.com/articles
Jime of Financial Hacks ---
https://wallethacks.com/
* Flexo of Consumerism Commentary –
www.consumerismcommentary.com
* Nickel of Five Cent Nickel –
www.fivecentnickel.com
* FMF of Free Money Finance –
www.freemoneyfinance.com
Bob Jensen's added threads on personal finance are at
http://faculty.trinity.edu/rjensen/fees.htm
A great resource site for finance, investing, world news, and accounting
CBS Market Watch (includes a glossary) --- http://cbs.marketwatch.com/news/default.asp?siteid=mkt
Bureau of Economic Analysis --- http://www.bea.gov/
Harvard Business School's Project
Finance
I am repeating a notice on Harvard's
Project Finance that I put in the March 16 edition of New Bookmarks,
because this will one day be a very important portal even though its glossary
disappoints me at the moment.
Harvard Business School Project Finance
Portal http://www.hbs.edu/projfinportal/
(the HBS Project Finance Portal's Glossary is at http://www.dbsa.org/privatesector/project_finance.htm
I found this glossary to be very disappointing
from a portal that is in other respects outstanding.)
A better set if glossaries can be found at http://faculty.trinity.edu/rjensen/bookbus.htm
Some of Harvard's Project Finance Portal links
are called "General Project Finance Links" at http://www.hbs.edu/projfinportal/generalpfhtm.htm
Global
Development Project Finance & Project Management Information
InfrastructureWorld.com:
This site is designed to assist project sponsors, developers, service
providers, and other professionals in completing project finance transactions.
It also contains 1000's of useful links.
Institute
of International Project Financing
International
Project Finance Association
Project
Finance Glossary
PrivateFinance-i.com:
PrivateFinance-i is the ultimate resource for online PFI/PPP news, research
and market information, and supports business-to-business services by uniting
buyers and sellers and enabling online transactions.
Turin
Group
The main Project Finance Website is at http://www.hbs.edu/projfinportal/
************************************************************************************
The University of Kansas International Business Resource Connection
http://www.ibrc.bschool.ukans.edu/
The IBRC, a business outreach program of the Center for
International Business Education and Research (CIBER) within the School
of Business at the University of Kansas,
was created to encourage trade opportunities and expand international business
education. Through strategic alliances with major partners (including the U.S.
Department of Education and the Kauffman
Foundation), private sector affiliates, faculty and students at the
University of Kansas, the IBRC assists small and medium-sized Kansas companies
explore available trade opportunities and broaden international business skills.
Particular emphasis is placed on the emerging role of electronic communication
resources (the Internet) in developing international business opportunities for
firms located in the heartland of the United States.
Also, don't
forget Paul Pacter's great international accounting site at http://www.iasplus.com/
************************************************************************************
Helpers for Marketing Students and
Educators --- MarketingProfs.com --- http://www.marketingprofs.com/
Other marketing links can be found at http://faculty.trinity.edu/rjensen/bookbob1.htm
************************************************************************************
One opinion on the top 10 investment
resource sites.
InvestMove.com --- www.investmove.com
BigCharts --- http://bigcharts.marketwatch.com/
From The Scout Report on February
22, 2002
Business 2.0 Web Guide http://www.business2.com/webguide/
According to one of its own brochures,
"Business 2.0 is the essential tool for navigating today's
relentlessly changing marketplace, particularly as it's driven by the
Internet and other technologies." In both print and electronic
versions, Business 2.0 does cover an incredible amount of ground,
including day-to-day and month-to-month information and offering extensive
subject lists of its material, broken down by general subjects -- from
management and marketing to Enron and the Internet. Not only clearly in
touch with today's business world, Business 2.0 promises to put its
readers in touch with it through company links, as well as through
straightforward contact lists. While Business 2.0 is open for anyone's
consultation, registered readers are granted greater access privileges to
archived and premium content.
Columbia
Newsblaster http://www.cs.columbia.edu/nlp/newsblaster/
With a team of
researchers headed by Prof. Kathy McKeown, Columbia Newsblaster is an
online project at Columbia University's Department of Computer Science in
the School of Engineering and Applied Science. Newsblaster currently looks
at news reports from thirteen sources, including Yahoo, ABCNews, CNN,
Reuters, Los Angeles Times, CBS News, Canadian Broadcasting Corporation,
Virtual New York, Washington Post, Wired, and USA Today. The product uses
artificial intelligence techniques to cull through news reports published
online and then sorts and summarizes these reports in five different news
categories -- US, world, finance, entertainment, and sports. These
summaries are based on reflecting factors, such as where a fact is
mentioned in the published reports and how often it is repeated across
reports dealing with the same event or subject. They are also based on the
news value of individual facts, such as how many were killed or injured,
or how much damage to property occurred. On the whole, in an age of
information overload, this newly developed tool may provide assistance to
journalists, executives, and average news consumers.
Bob Jensen's search helpers are at http://faculty.trinity.edu/rjensen/searchh.htm
Other top investment and finance portals
Yahoo's picks of the top finance web sites --- http://www.zdnet.com/zdsubs/yahoo/content/101most/101finance.html
Top 50 Financial Websites --- Money.com http://www.money.com/money/depts/websmart/bestweb/index.html
Advanced Stock Information http://www.stockadvanced.com/
(note that ratios are available)
Enter a symbol and click "go!" to get the
following information: Stock Prices, Options, Stock Splits, Charts, Live Stock
Quotes, Stock Performance, Earnings Estimates, Analyst Opinions, Company
Performance, Stock Valuation, Broker Reports, Company Profile, Earnings
Release Dates, Latest News, Fundamentals, Intraday Charts, Forum Discussions,
Technical Charts, Annual Reports, Significant Events, Institutional Ownership,
Financial Ratios, Insider Trading, SEC Filings, Financial Statements, Stock
Dividends, Competition, Momentum Rating, Management Discussion, Conference
Calls, Short Interest, and more.
From the Scout Report --- Business.com http://www.business.com/
The owners of this lucrative URL address have
sponsored a Web directory created by a "team of 50 research analysts
[that] has sifted through the Web to find relevant sites for our handcrafted
Directory." All Websites in this 30-category directory have been
annotated. The annotations, however, tend to be very terse and a bit vague.
First time users are encouraged to skim over the excellent site guide, which
gives a step-by-step manual for using the site as well as in-depth
explanations of the terminology and taxonomy.
Financial Risk Links --- http://victoryrisk.com/
Center for Financial Research & Analysis,
Inc.
CFRA, Inc. Launches Free On-Line Service for Academic
Community
Rockville, MD - August 1 - The Center for Financial
Research & Analysis (CFRA, Inc.), a leading provider of independent
research to over 2,000 institutional investors, will now offer an academic
version of its product to professors and their students. Since there is no
cost for this service, its use is restricted for research and teaching
purposes.
What's included with the Academic Version?
1. Access to all educational pieces in our database.
2. Access to selected company-specific reports that focus on quality of
earnings issues 3. Weekly e-mail notification of new companies added to the
database
Who qualifies for this service and how can you sign
up?
All professors teaching courses in financial
accounting, auditing, and finance qualify. To sign up, click on the URL http://www.cfraonline.com
and register. Then sign and fax the agreement to (301) 984 8617. Once
activated, you will have access to the Academic Version of CFRA's database.
About CFRA
CFRA has become known internationally for its
pioneering research ferreting out companies with operational problems that use
unusual accounting practices to camouflage such practices. Founded in 1994 by
Dr. Howard M. Schilit following a 20 year career as an accounting professor
(author of FINANCIAL SHENANIGANS: How to Detect Accounting Gimmicks and Fraud
in Financial Reports) http://www.cfraonline.com/publications/publications.jsp#FinancialShenanigans
CFRA provides a daily on-line news wire of financial analysis and a database
on over 900 companies. Its mission is to warn investors and creditors about
companies experiencing operational problems and particularly those that employ
unusual or aggressive accounting practices to camouflage such problems.
Howard Schilit
http://www.cfraonline.com
301-984-1001 ext. 105
Management and
Organization Behavior
Marketing,
Advertising, and Consumer Behavior
Thank you Florida Gulf
Coast University for this is a great web site for business and economic
research http://library.fgcu.edu/Subjects/Business/bushome.htm
Facts and statistics (Fast Facts) --- http://gwu.edu/~gprice/handbook.htm
Immigration Since 1840 Social studies dp.la/browse-by-topic/immigration-since-1840
---
https://dp.la/browse-by-topic/immigration-since-1840
Country Briefings (international statistics) from The Economist http://www.economist.com/countries/
This U.S. Department of Commerce Website has a wealth of data and news --- http://www.doc.gov/
|
|
Assistance
Freedom
of Information Act (FOIA), Grants,
Reference
Business
Development
Contracting
Opportunities, Disadvantaged
Businesses, Publications,
...
Economic
Analysis
Bureau
of Economic Analysis, Demographics,
Economic
Data, ...
Economic
Development
Innovative
Programs
Environmental
Management
Conservation,
National
Environmental Satellite, Data, and Information Service (NESDIS),
Publications,
...
Industries
Exporting,
Industries
and Sectors Information, Technology
International
Trade
Bureau
of Export Administration, Defense
Trade, Export
Controls and Regulations, ...
|
|
Electronic
Commerce
Programs/Initiatives,
Publications
and Reports, Statistics
Employment
and Internship Opportunities
Laws
and Regulations
Economic
Development, Exporting
Patents
and Trademarks
Programs
and Initiatives
Quality,
Relief
and Reconstruction
Science
and Technology
Internet,
Science,
Spectrum
Mgmt, ...
Statistics
and Research
Publications
|
|
|
Finding Colleges, College
Rankings, Financial Aid, and Online Programs
Guides to Distance Education Courses and Programs ---
http://faculty.trinity.edu/rjensen/245progs.htm
Finding
Colleges, College Rankings, Financial Aid, and Online Programs --- http://faculty.trinity.edu/rjensen/bookbob2.htm#EducationInGeneral
Bookmarks are
Listed Below
Accounting
- AccounitngEducation.com has database links category of international
university directories --- http://accountingeducation.com/links/
-
- Bob Jensen's
Links to Accounting Education Programs
- Bob Jensen's Links to Accounting Software and Vendors
- On Balance Forum -
Conferences (Accounting Education Listservs)
On-line CPE Source - Quick, Easy, and Convenient CPE
- Insight CPE: Continuing Profesional
Education for CPA's
- Welcome to the
CPEInternet Campus!
- RARC(Rutgers Accounting Research Center)
Secured Site
- BEST CPE - ONLINE CPE Courses for CPA's:
Hardwick Publications
- NRI Schools -- Leader in Career Training
for Busy Adults
- http://www.isworld.org/isworld.html
- Accounting Related
Resources
- BUSINESS RESOURCES
- AAA American
Accounting Association
- Financial
Accounting Standards Board (FASB)
Accounting Education Change Commission
(AECC)
- Summerfor Web (AAA
Accounting Education News)
- ACCOUNTING TOP FIVE
WEB SITES
- AICPA Home Page
- AICPA Journal of
Accountancy
AICPA Index by Subject
AICPA Online Audio/Video Library
- AICPA Webtrust
Principles and Criteria
ANet Australia home (International Accounting Network)
- Association of
Government Accountants
Smart Communities Network --- http://www.sustainable.doe.gov/
- Case-Based Reasoning
in the Web
- Global Window Main
Menu (Business Schools and Culture of Japan)
- Jim Hasselback's
On-line Accounting Faculty Directory
- NAN Nordic
Accounting Network
- PIC-AECM Pacioli Web Server
- RAW Rutgers
Accounting Web Introduction
-
CPA Online: Your source for Accounting
Information on the Internet
- Newsand Information (Legislation, Law,
Accounting, Auditing, Health)
- Wm. Dennis Huber's
Web Page
- Will Yancey's Home Page
- Master of Business Taxation Degree
Program University of Minnesota (tax)
Good links to education sites http://www.teleport.com/~hadid/bookmark_page.html
Jim Hasselback's On-line Accounting
Faculty Directory
Jensen & Sandlin Survey of U.S. Accountancy Education
Programs (This is now out of date)
Bob Jensen's Links to selected colleges and accounting
education programs
- Gerald Trite's great set of
links --- http://iago.stfx.ca/people/gtrites/Docs/bookmark.htm
- Tax and Accounting Sites Directory
- Rutgers Accounting on the Web Mailing
List WWW Gateway
- E. Barry Rice, Loyola College in Maryland
- Accounting Quiz Demo (Richard Campbell,
ToolBook Demo of Java)
Roger Debreceny Home Page
Trends in Technologies for Ocean-Spanning
Asynchronous Learning
- ACCOUNTING SOURCES
(Pamela Jarvis)
- ANEWS-L: Hasselback
Directory now on ANet
ANet Australia home (International Accounting Network)
- Jim Hasselback's
On-line Accounting Faculty Directory (Prentice-Hall Web Site)
- InterNIC Guide to
U.S. Universities (Directory)
- 000021
AmericanCollegesand Universities
- Jensen & Sandlin Survey of U.S. Accountancy Education
Programs
- Ceil M. Pillsbury
Sharon Lightner at San Diego State
University
- AcctgInfoPlus
Accounting Education Links
- Cital-Welcome
- Department of Accounting &
Finance,UOW
- Favorite Sites --
Accounting, AIS & MIS Students & Professionals
- Homepage for Larry
Tomassini
- Pacioli Web Server
- Randall B. Dunham
- School of
Accountancy - Faculty - Charles Christian
- Stonehill College: Programs in
Accountancy (John A. Schatzel)
- Tennessee Quality
Award
Internet Exploration: Hot Sites
- Darrell Walden at U.
of Richmond - Accounting Information Systems
- Univeristy of
Waterloo - School of Accountancy - J.E. Boritz
- Will Yancey's Home Page (great accounting
links)
- AccounitngEducation.com has database links category of
international university directories --- http://accountingeducation.com/links/
-
- Bob Jensen's Guides (Old and Outdated)--- http://faculty.trinity.edu/rjensen/245progs.htm
-
- Yahoo! -
Education:Higher Education:Colleges and Universities
Tax and Accounting Sites Directory
- Accountant's Home Page
- Accounting Sites
Directory
- ANet People Database Welcome
ANet Australia home (International Accounting Network)
- Jim Hasselback's
On-line Accounting Faculty Directory
- Marr and Kirkwood Official Guide to
Business School Webs
- US News Online Comparisons of Programs in Higher Education
-
- Bob Jensen's Guides --- http://faculty.trinity.edu/rjensen/245progs.htm
http://faculty.trinity.edu/rjensen/255wp.htm
Free Tax Tutorials for Professors and Students
Tax Analysts, a non-profit pubic service organization
that provides in-depth tax information resources for tax professionals, has
announced it is making its news and research products available at no charge to
accounting, law, and economics professors and their students.
AccountingWeb, June 28, 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=103676
See
http://taxprof.typepad.com/taxprof_blog/files/tax_analysts_campus.pdf
Bob Jensen's tax helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
The Journal of Accountancy has many
free accounting and tax helpers ---
http://www.aicpa.org/pubs/jofa/joahome.htm
You can order back issues or relevant links management and accounting
books and journals from MAAW ---
http://maaw.info/
Free Access to Back Issues of The Accounting Review ---
http://maaw.info/TheAccountingReview.htm
From MIT: OKI and DSpace --- http://faculty.trinity.edu/rjensen/000aaa/updateee.htm#OKI
From Smart Stops on the Web, Journal of Accountancy, July 2007 ---
http://www.aicpa.org/pubs/jofa/jul2007/news_web.htm
THE BLOGGING PROFESSOR
http://taxprof.typepad.com
This Smart Stop provides a daily dose of tax
news, papers and court judgments. Professor
Paul Caron of the University of Cincinnati
College of Law updates the site frequently
with a balance of academic and practical
items, ranging from IRS reports to details
on upcoming tax conferences. CPAs can use
the topical archive to find posts by subject
tag. Caron’s site is part of the Law
Professor Blogs Network (see “Smart
Stops on the Web,” JofA, Oct.
06, page 27), which hosts a variety of
academic blogs on securities, banking,
nonprofits and trusts. |
|
August 30, 2005 message from Walter Antoniotti
[antonw@ix.netcom.com]
-
- American
Accounting Association Accounting Coursepage Eschange (ACE)
American Accounting Association
Teaching Section
Accounting Journals Index
Arthur Andersen KnowledgeSpace
Bob Jensen's Links to selected colleges and accounting
educators
- Bob Jensen's Vendor
Database
Sharon Lightner at San Diego State
University
- Also see my review of Sharon's innovative international accounting
course http://faculty.trinity.edu/rjensen/255light.htm
- Ceil M. Pillsbury
- Course Outline ACTG
691
- David R. Fordham
- Global Window Main
Menu (Business Schools and Culture of Japan)
- Homepage for Larry
Tomassini
- Jensen & Sandlin Survey of Accountancy Education Programs
- Jensen & Sandlin Survey of Commerical Learning Materials in
Accounting
- JohnSon's Accounting
and Auditing Page
Abstract97 (compliance detection,
real-time audits)
- Marr and Kirkwood Official Guide to
Business School Webs
- OSU Department of
Accounting & MIS
- Rethinking Teaching
and Learning (Accounting, Microsoft Award Winner)
- Spiceland's
Intermediate Accounting II
- Tax Resources (U. of
Iowa)
- Will Yancey's Home Page
-
Februrary 16, 2003 message from Gerald Trites [gtrites@STFX.CA]
The Canadian Institute of Chartered
Accountants has a publication "Information Technology Control
Guidelines" which was published in 1999. The book is quite large
and there has been some talk about a possible decision support system
that might be developed, loaded with the ITCG guidelines, placed on a
CD and used in the field for assistance in analyzing system controls
for particular systems/companies and developing recommendation
letters. I would think the preferred approach would be to find a
suitable shell and then build the system around it. In the course of
my research of a good system, I came across VP-Expert which at one
time was highly recommended, but it is DOS based and appears to be out
of date. There is a variety of others. Does anyone have knowledge of a
good DS shell that might be useful for this application and that would
run on current Windows platforms? It should have run-time capability
so the CD can run on its own.
Any advice you might have would be most
appreciated.
Gerald Trites, FCA
Professor of Accounting and Information Systems
St Francis Xavier University Antigonish,
Nova Scotia Tel.
Website - http://www.stfx.ca/people/gtrites
The CICA home page is at http://www.cica.ca/
Activities Based Costing (ABC)
http://akao.larc.nasa.gov/dfc/abc/abcbib.html
(annotated bibliography)
http://users.aol.com/caspari/l118.htm
(Is ABC Fundamentally Flawed?)
http://www.chief.co.il/toc/
http://members.aol.com/caspari0/toc/BIBLIOG.HTM
(bibliography)
http://www.focusedmanagement.com/FMI%20Articles/softabc%281%29.htm
(ABC Software)
http://www.deloitte.com.au/index.asp?MenuId=0&Page=/content/abc.asp
http://www.mmsonline.com/articles/119803.html
http://mba.vanderbilt.edu/germain.boer/Creating%20Value/Discussions/InvLevelandProfit.htm
(from my good friend Germain)
http://www.intentia.se/liston/1762_2.lxml
http://www.neiu.edu/~hchen/202/98/
http://web.mit.edu/lfm/www/working_papers/1996_abstracts/strimling_abstract_1996.html
http://www.sba.pdx.edu/faculty/darrellb/dbaccess/finalstu.htm
http://www.acq-ref.navy.mil/wcp/abc2.html
http://www.tocc.com/Geyser_G.html
(you have to do a little hunting)
http://hamilton99.execmba.com/activity.htm
(Case Study)
http://www.acca.org.za/publications/studenews/9811p34.html
(Value Added)
http://www.sbm.temple.edu/~jmereba/research.html
(See the Working Papers section)
I would examine the listing of the Managerial Accounting texts at http://www.bn.com/.
Enter the search terms "Managerial Accounting" and "Management
Accounting."
I also recommend that you look at the Managerial and Cost Accounting Courses
in ACE at http://www.rutgers.edu/Accounting/raw/aaa/ace/index.htm
- Activities Based Costing (ABC)
Costing Bibliography
http://www.saffm.hq.af.mil/SAFFM/FMC/ABC/bibliography.htm
Activities Based Management and
ABC Costing http://www.rpm-abm.com/cami_idx.htm
"Towards a New Cost-Aware Evaluation Framework"
http://ifets.ieee.org/periodical/vol_4_2000/ash.html
Added later
Dear Professor Jensen,
There is an interesting website about ABC and EVA
that named: Activity-Based Costing (ABC) Economic Value Added Internet Website
GuideWritten by Narcyz Roztocki (http://www.newpaltz.edu/~roztockn/)
at http://www.pitt.edu/~roztocki/abc/abc.htm
Regards,
Rudi Handoko
Tim1 [Tim1@jsx.co.id]
Added later
Dear Mr. Jensen,
found your web site, which is remarkable, and I was wondering if you
would consider adding our organization to your listing of Activities Based
Costing (ABC) links. ICMS, Inc. has been around training & coaching
organizations in all industries to implement ABC/ABM since 1988. Please visit
our web site for more information:
URL: http://www.icms.net
Thank you!
Christine Nola, ICMS, Inc. 6031 West I-20, Suite 219 ~ Arlington, Texas 76017
Phone: 817.483.6511 ~ Fax: 817.483.7097
Webs: http://www.icms.net
and http://www.learnabm.com
Financial Calculators and Other Tools for Business Valuation and
Forecasting --- http://faculty.trinity.edu/rjensen/bookbob3.htm#080512Calculators
Hi Thomas,
I hope you are doing well. In response to
your financial ratio question, I am afraid that I do not know of a free
site that maintains company profiles and industry profiles for a complete
set of ratios. Most services charge for this service, although some
services provide a few free ratios and other indicators. Beware of
ratio definitions. As you well know, there are various ways to
compute almost any financial ratio. Naive analysts may be comparing
apples and oranges when looking at values of any ratio.
ACCOUNTING AND FINANCE LINKS
Thanks to Chris Nolan I found a pretty
good free web site for company and company-to-industry
comparison ratios at http://www.financialweb.com/
. Click on the research tab in at that web site and enter a symbol like
IBM.
Chris also recommended http://www.stockpoint.com/
. Enter a symbol or company name such as IBM. Get the Quote
for that company. Then click on the Company Profile button to see
some ratios.
Another free web
site that I recommend is http://www.investorguide.com/cgi-bin/research.cgi
After searching on a particular company's symbol (try IBM), you will find
a Market Guide link.
Alternately, you can begin with Market Guide at http://www.marketguide.com/mgi/snap/4741N.html
or http://Yahoo.marketguide.com
.
Users should carefully examine the Market Guide Glossary at http://yahoo.marketguide.com/mgi/HELP/glossary.html
. A possible exercise for students is to have them verify (for
selected companies and selected ratios) the Market Guide calculations.
My next recommendation is to go to http://www.natcorp.com/framedirectory.html
. By entering a company's stock symbol, you can get all sorts of links,
including that company's profile and fundamentals links. The "Company
Data" path at this web site leads to http://www.natcorp.com/traded.html
ABC News has some quick and very limited
company information for free at http://webapp.abcnews.com/profiles/abc_comp_profiles.asp
The New Google Stock Screener (sort of nice as online screeners
go) ---
Click Here
If you want to look
up a company's annual report online, a very good annual report directory
is located at
http://www.reportgallery.com/content/glry_a.htm
. Of course there are some good SEC links at
EDGAR
Database at
http://www.sec.gov/edgarhp.htm
EDGARSCAN from
PriceWaterhouseCoopers at http://www.pwcglobal.com/gx/eng/ins-sol/online-sol/edgarscan/
Free EDGAR at http://www.freeedgar.com/
From the CFO Journal's Morning Ledger on May 4, 2016
The hottest metric in finance: ROIC
A metric known as return on
invested capital is all the rage, used by companies such as
General Motors Co. to placate activist investors. For ROIC
lovers, which also include traditional stock pickers, the measure is
the best way to distill what activists view as the most critical
skill of management: how they allocate capital.
For a fee, you can get more complete
company and industry profiles at http://www.wsrn.com
. This is a very good service but some good things in life are not free.
If you are interested in online financial
analysis, I highly recommend some of Larry Tomassini's great links.
Tomassini's CorpOnline at http://www.cob.ohio-state.edu/~tomassin/corps/corp.html
Tomassini's Financial Analysis Online http://www.cob.ohio-state.edu/~tomassin/fanon.html
Jim Borden mentioned
the Deloitte & Touche web site at
http://www.peerscape.com/member/index.cfm
I found the above server to be painfully slow. However, Jim's
recommendations should always be taken seriously.
MACRO ECONOMICS LINKS (including data
classified by industry)
Last year I shared a platform with David
Boldt at an education technology conference at Bentley College. David has
a great web site for economists, particularly in the area of
macroeconomics. His materials are listed at http://www.westga.edu/~dboldt
If you are looking for industry and
economic statistics. one place to begin searching is at http://rfe.wustl.edu/
The 2008 Statistical Abstract ---
http://www.census.gov/compendia/statab/
IPUMS USA (census data from 1850 to present) ---
https://usa.ipums.org/usa
U.S. Census Bureau: Random Samplings ---
http://blogs.census.gov/
Statistical Abstract of the United States 2004-2005 ---
http://www.census.gov/statab/www/
Bob Jensen's threads on encyclopedias are at
http://faculty.trinity.edu/rjensen/bookbob3.htm#Dictionaries
U.S. Census Bureau: Random Samplings ---
http://blogs.census.gov/
Historical Census Browser ---
http://fisher.lib.virginia.edu/collections/stats/histcensus/
U.S. Census Bureau ---
http://www.census.gov/
From the U.S. Census Bureau ---
http://www.census.gov/hhes/www/income/income.html
Explanations of economic
statistics can be found at EconDash.com http://www.econdash.net/
The above web site
leads to a heap of macro data, but you were more interested in industry
ratios. A bit of searching from the above site led me to a University of
Michigan site at
http://www.lib.umich.edu/libhome/Documents.center/stats.html
There are various industry categories at
the above web site. The Business and Industry button led me to the
FedStats web site at http://www.fedstats.gov
Facts and statistics (Fast Facts) --- http://gwu.edu/~gprice/handbook.htm
Country Briefings (international statistics) from The Economist http://www.economist.com/countries/
Another good set of Federal Government
links can be found at
http://www.sec.gov/others.htm
Not much in the way of ratio data at that web site, but you will find a
variety of interesting documents and links.
A personal finance site geared to
the younger generation
Jump$tart.org http://www.jumpstart.org/
Advertisement Free
Personal Finance Blogs ---
http://pfblogs.org/blog/29
Portfolio Management
Journal of Portfolio Management -
http://www.cpanet.com/up/s0210.asp?ID=0606
Portfolio Management Forum - http://www.cpanet.com/up/s0210.asp?ID=0607
Portfolio Knowledge - http://www.cpanet.com/up/s0210.asp?ID=0608
The Small-Cap Alpha Myth - http://www.cpanet.com/up/s0210.asp?ID=0609
50 Most Common Mistakes Made by Traders and Investors ---
http://www.ratiotrading.com/2009/09/50-common-mistakes-most-traders-make/
Multistyle Rotation Strategies - http://www.cpanet.com/up/s0210.asp?ID=0610
myCFO - http://www.cpanet.com/up/s0210.asp?ID=0611
Advertisement Free
Personal Finance Blogs ---
http://pfblogs.org/blog/29
Consumer Reports subscribers can access an excellent helper site
for personal finance --- http://finance.ConsumerReports.org
A separate subscription for online access is available that also provides
a discount to the hard copy magazine subscription.
Employees have seen once-lush 401(k) retirement
accounts--already whipped by two years of stock market
losses--shrink even more in the summer's market slide. But
some 44 million workers have another asset: a
defined-benefit pension plan
We provide details on exchange-traded mutual funds,
and how they might save you money on your year-end
income taxes.
Our expert advice and recommendations for the many
families who can benefit from this plan.
Here, the details on retail theft and how consumers
are paying the price.
Now that you know what to buy, find the best places
to buy it, with our e-Ratings.
|
|
Key |
|
* |
indicates a
product that is part of our continual-testing program. |
R |
indicates a
Ratings report. |
A |
indicates
an archive Ratings report. Many of the tested models may no
longer be available. |
The Consumer Reports home page is at http://www.consumerreports.org
A complete index of all reports is available at A to Z index
Reply from Thomas,
Thanks to everyone who responded to my request for
information about industry financial ratios on the Web. After reviewing
several sites, I decided to settle with the following:
Yahoo Market Guide: http://Yahoo.marketguide.com
.
If you enter a company’s Name or Ticker
Symbol in the "Search For" field and then click GO and then
Comparison, you will not only obtain financial ratios for the company you
have searched for, but you will also find ratios for (1) the company’s
industry, (2) the economic sector in which the company operates, and (3)
the S&P 500. Other items that you may view about a selected company
include:
A Snapshot of the
company
Stock Market Quotes
Recent News about the company
Custom Price Charts (this is very interesting)
Highlights
Analysts’ Earnings Estimates and buy/sell recommendations
Market Performance data and summary of institutional ownership
Financial ratio Comparisons—Industry, Sector, S&P 500
Insider Trading
Instit. Ownership
Financials
I plan to use this site for a class
project in which students are required to analyze/evaluate a small number
of companies. Although it "works", I am concerned about the
underlying source and reliability of the numbers and other information
that appear at this and other similar sites. Are there any unpublished or
published studies on this issue?
Thomas G. Calderon,
Professor
G. W. Daverio School of Accountancy
College of Business Administration
The University of Akron
Akron, OH 44325-4802
Tel: (330) 972-6099
Fax: (330) 972-8597
mailto:tcalderon@uakron.edu
Advanced Stock Information http://www.stockadvanced.com/
(note that ratios are available)
Enter a symbol and click "go!" to get the
following information: Stock Prices, Options, Stock Splits, Charts, Live Stock
Quotes, Stock Performance, Earnings Estimates, Analyst Opinions, Company
Performance, Stock Valuation, Broker Reports, Company Profile, Earnings Release
Dates, Latest News, Fundamentals, Intraday Charts, Forum Discussions, Technical
Charts, Annual Reports, Significant Events, Institutional Ownership, Financial
Ratios, Insider Trading, SEC Filings, Financial Statements, Stock Dividends,
Competition, Momentum Rating, Management Discussion, Conference Calls, Short
Interest, and more.
Update on November 29, 2001 from Ken Neet
Try http://moneycentral.msn.com/investor/invsub/results/compare.asp
Enter a stock symbol. The next page allows you to select from several
categories of ratios.
Update on November 29, 2001 from Enrique Bonson Ponte
You can find Spanish industry averages for free at http://www.registradores.org/iestadis.htm
and then financial statements of Spanish quoted companies at http://www.cnmv.es
Update on November 29, 2001 from Tom Omer
Here is one I use that works very well.
http://www.corporateinformation.com/
Jalal Soroosh recommends http://edgarscan.pwcglobal.com/
First Research, Inc. Publishes
seven- to fourteen-page targeted Industry Profiles on over 100 industries.
http://www.accountingweb.com/firstres/index.html
Faculty and
Program Performance Appraisal Trends and Accreditation
You may want to especially note the AACSB's International Performance
Indicators Project --- http://www.aacsb.edu/PerformanceIndicators/index.html
The Performance Indicators Project focuses
AACSB International resources on building the most comprehensive and
complete database about business schools available anywhere. This
database will be used to provide members with a customizable set of
information products and services designed to support planning,
budgeting and continuous improvement efforts. The online system,
scheduled for launch in January 2001, will be available for use only to
schools that provide data.
Certain data, specifically indicated in AACSB
International surveys and questionnaires, also will be available
via the AACSB International Web site to promote member schools to key
stakeholders such as prospective students, employers and the media. The
Web increasingly serves as the primary resource for prospective business
faculty, students and employers. Participating schools also will be
eligible for inclusion in exclusive AACSB International lists and other
informational pieces designed to better inform stakeholders about
business schools, accreditation and the management education industry.
AACSB International Newsline articles
about the Performance Indicators Project
Frequently
Asked Questions (FAQs) about the Performance Indicators Project –
PDF
This is also one of the topics covered in the American Accounting
Association's benchmarking/partnering initiative. See http://accounting.rutgers.edu/raw/aaa/partners/partners.htm
ACADEMIC PARTNERS will
help your department improve through:
- A newsletter especially for
program leaders
- Leadership Express,
bi-weekly electronic bulletins alerting program leaders to the
latest trends and issues in the field
- Electronic discussion
groups led by experts in their areas. Share your expertise and
interact with leading accounting educators.
- Opportunities to connect
electronically with colleagues worldwide to discuss topics of
relevance to you.
- Faculty and administrator
development programs
- Discounted registration for
midyear Annual Seminar of the AAA’s Accounting Programs Leadership
Group (APLG)
- Toolkits, comprehensive
collections of resources such as videotapes, books, bibliographies
and CDs, on topics like assessment, faculty evaluation, active
learning, and cognitive development and professional skills
You may want to track the new Leadership Express Newsletter at http://accounting.rutgers.edu/raw/aaa/partners/vol1no1.htm
Then if you really want to be overwhelmed, enter the phrase
"Faculty Assessment" under the category "exact phrase"
at http://www.google.com/advanced_search
The American Academy of Accounting and Finance (AAAF) --- http://www.aaafonline.org/
In 1993 a group of accounting and finance
professors at a small, teaching oriented, public university started discussing
the idea of a cross-disciplinary organization for academicians in the accounting
and finance disciplines.
AACSB - International had only recently revised its accreditation standards to
make accreditation a realistic option for smaller schools. Even those revised
AACSB accreditation standards required faculty to be active in the production of
intellectual contributions, i.e. research.
Given the increased emphasis that many teaching oriented schools began to place
on research as a result of the change in AACSB standards, the organizers
believed there were insufficient research outlets then available to faculty at
primarily teaching institutions with limited resources. Accordingly, the
organizers decided to move forward with the creation of organization that would
give faculty at smaller, primarily teaching institutions access to an
organization with a process that would assist them in achieving their research
goals.
Also see the following accrediting organizations and
summaries:
Specialized Accrediting Agencies --- http://yeah.indstate.edu/hypermail/archive/elaf686/elaf686.9903/0002.html
AACSB --- http://www.aacsb.edu/
ACSBP --- http://www.acbsp.org/
Jack Anderson's Accounting Information Finder --- http://www.umsl.edu/~anderson/accsites.htm
From The Wall Street Journal Accounting Weekly Review on
September 3, 2010
The Decline of the P/E Ratio
by:
Ben Levisohn
Aug 30, 2010
Click here to view the full article on WSJ.com
Click here to view the video on WSJ.com
TOPICS: Analysts'
Forecasts, Financial Statement Analysis, Forecasting
SUMMARY: "While
U.S. companies announced record profits during the second quarter,
and beat forecasts by a comfortable 10% margin, on average, the
stock market has dropped 5%. Based on trailing 12-month earnings,
the average price earnings (P/E) ratio in the overall market is
about 14.9 compared to 23.1 in September 2009; "based on profit
expectations over the next 12 months, the P/E ratio has fallen to
12.2 from about 14.5 in May, 2010." The reason for this divergence
is, of course, economic uncertainty that is not evident in the
(average) point estimates of earnings nor in the relatively good
earnings numbers of both the first and second calendar quarters of
2010. The related article is a WSJ graphic of earnings per share
actual compared to average analyst estimates, by industry and by
week.
CLASSROOM APPLICATION: The
article is useful to show the need for understanding context of
ratios in undertaking financial statement analysis. It also
demonstrates that ratios can be measured in more than one way, such
as the use of past earnings or analysts' average forecasts. The
related article can be used to introduce students to analysts'
earnings forecasts.
QUESTIONS:
1. (Introductory)
Define the price earnings ratio (P/E) and explain its meaning.
2. (Introductory)
What two methods of measuring P/E are described in the article? Why
do you think both are used?
3. (Introductory)
Refer to the related article. How are analysts' estimates used in
this WSJ graphic analysis? In your answer, also describe who are the
analysts producing these estimates.
4. (Advanced)
How did companies perform relative to analysts' estimates in the
second calendar quarter of 2010?
5. (Advanced)
What has happened to the P/E ratio? Why does the author say the P/E
has fallen in relevance? Do you agree with that assessment?
6. (Introductory)
What other evidence in the article corroborates the issues in the
recent fall in the average P/E ratio?
Reviewed By: Judy Beckman, University of Rhode Island
RELATED ARTICLES:
Now Reporting: Earnings
by
Aug 01, 2010
Online Exclusive
"The Decline of the P/E Ratio," by: Ben Levisohn, The Wall Street
Journal, August 30, 2010 ---
http://online.wsj.com/article/SB10001424052748703618504575459583913373278.html?mod=djem_jiewr_AC_domainid
As investors fixate on the global forces
whipsawing the markets, one fundamental measure of stock-market
value, the price/earnings ratio, is shrinking in size and
importance.
And the diminution might not stop for a
while.
The P/E ratio, thrust into prominence
during the 1930s by value investors Benjamin Graham and David Dodd,
measures the amount of money investors are paying for a company's
earnings. Typically, companies that post strong earnings growth
enjoy richer stock prices and fatter P/E ratios than those that
don't.
But while U.S. companies announced record
profits during the second quarter, and beat forecasts by a
comfortable 10% margin, on average, the stock market has dropped 5%
this month.
The stock market's average price/earnings
ratio, meanwhile, is in free fall, having plunged about 36% during
the past year, the largest 12-month decline since 2003. It now
stands at about 14.9, compared with 23.1 last September, based on
trailing 12-month earnings results. Based on profit expectations
over the next 12 months, the P/E ratio has fallen to 12.2 from about
14.5 in May.
So what explains the contraction? In short,
economic uncertainty. A steady procession of bad news, from the
European financial crisis to fears of deflation in the U.S., has
prompted analysts to cut profit forecasts for 2011.
"The market is worrying not just about a
slowdown, but worse," said Tobias Levkovich, chief U.S. equity
strategist at Citigroup Global Markets in New York. "People want
clarity before they make a decision with their money."
Three months ago, analysts expected the
companies in the Standard & Poor's 500-stock index to boost profits
18% in 2011. Now, they predict 15%. Mutual-fund, hedge-fund and
other money managers put the increase at closer to 9%, according to
a recent Citigroup survey, while Mr. Levkovich's estimate is for 7%
growth.
"The sustainability of earnings is in
doubt," said Howard Silverblatt, an index analyst at S&P in New
York. "Estimates are still optimistic."
Equally troublesome, analysts' forecasts
are becoming scattered. In May, the range between the highest and
lowest analyst forecasts of S&P 500 earnings per share in 2011 was
$12. Morgan Stanley predicted $85 per share, while UBS predicted $97
per share. Now, the spread is $15. Barclays said $80 per share;
Deutsche Bank predicts $95.
When profit forecasts are tightly
clustered, it signals to investors that there is consensus among
prognosticators; when they diverge wildly, it shows a lack of
clarity. The P/E ratio tends to fall as uncertainty rises, and vice
versa.
"A stock is worth its future earnings, but
that involves uncertainty," said Jeremy Siegel, professor of finance
at the University of Pennsylvania's Wharton School. "The more
uncertainty there is, the lower the P/E will be."
Not only is the P/E ratio dropping, it also
is in danger of losing some of its prominence as a market gauge.
That is because, with profit and economic
forecasts becoming less reliable, investors are focusing more on
global economic events as they make trading decisions, parsing
everything from Japanese government-debt statistics to shipping
patterns in the Baltic region.
To some extent this is in keeping with
historical patterns. P/E ratios often shrink in size and
significance during periods of uncertainty as investors focus on
broader economic themes.
P/E ratios fell sharply during the
Depression of the 1930s and again after World War II, bottoming at
5.90 in 1949. They plunged again during the 1970s, touching 6.97 in
1974 and 6.68 in 1980. During those periods, global events sometimes
took precedence over company-specific valuation considerations in
the minds of investors.
There have been periods when the P/E ratio
was much more in vogue. A century ago, the buying and selling of
stocks was widely considered to be a form of gambling. P/E ratios
came about as a way to quantify the true value of a company's
shares. The creation of the Securities and Exchange Commission
during the 1930s made financial information more available to
investors, and P/E ratios gained widespread acceptance in the
decades that followed.
But thanks to the recent shift toward
rapid-fire stock trading, the P/E ratio may be losing its relevance.
The emergence of exchange-traded funds in the past 10 years has
allowed investors to make broad bets on entire baskets of stocks.
And the ascendance of computer-driven trading is making
macroeconomic data and trading patterns more important drivers of
market action than fundamental analysis of individual companies,
even during periods of relative calm.
So where is the P/E ratio headed in the
short term? A few optimists think it could rise from here. If
corporate borrowing costs remain at record lows and stock prices
remain depressed, companies will start issuing debt to buy back
shares, said David Bianco, chief U.S. equity strategist for Bank of
America Merrill Lynch. As a result, earnings per share would
increase, he said, even if profit growth remains sluggish, and P/E
ratios could jump with them.
But today's economic uncertainty argues
against that scenario. Consider that while P/E ratios dropped during
the inflationary 1970s, they also fell during the deflationary
1930s. The one common thread tying those two eras of falling P/E
ratios: unpredictable economic performance.
"We're looking at a more volatile U.S.
economy than we experienced in the last 30 years," said Doug
Cliggott, U.S. equity strategist at Credit Suisse in Boston. "The
pressure on multiples may be with us for quite some time."
September 8, 2010 reply from John Briggs, John
[briggsjw@JMU.EDU]
I saw
this article and didn't quite "get" it...the title at least.
Of course
the P/E ratio is still relevant.
My favorite site for
this is
www.multpl.com,
where a guy provides a
daily look at the Shiller ("Irrational Exuberance") 10-year P/E...10
years of data instead of 1. It's currently 20. It used to be 45.
Indeed, 45 was a bubble.
Right
now, you would think 16 would be appropriate, but extremely low
interest rates argue for higher (in comparison to investing in
bonds), but economic uncertainly argues for lower.
So I'd
make the case that this metric should be around 16 right now...20
indicates to me that stocks are slightly overvalued.
The only
time the P/E ratio really was ignored was in 2000, it seems to me.
I'm glad I had no money then.
Bob
Jensen's bookmarks for financial ratios ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010303FinancialRatios
Also see
http://en.wikipedia.org/wiki/Financial_ratios
Bob Jensen's threads on valuation are at
http://faculty.trinity.edu/rjensen/roi.htm
Bob Jensen's listing of free online textbooks and other learning materials
are at
http://faculty.trinity.edu/rjensen/ElectronicLiterature.htm#Textbooks
Note that most of these are not repeated below, so please click on the above
link.
Comparisons of National and International accounting rules ---
http://faculty.trinity.edu/rjensen//theory/00overview/theory01.htm#FASBvsIASB
Bob Jensen's summary of accounting theory ---
http://faculty.trinity.edu/rjensen//theory/00overview/theory01.htm
O'Keefe Accounting Library Searches
http://library.sau.edu/bestinfo/Majors/Accnt/accindex.htm
Free CPA Review Course ---
http://cpareviewforfree.com/
CPA Examination
candidates and accounting faculty should check out the free database
at
http://www.cpa-exam.org/cpa/literature.htm
The Trinity University library has a single-user
license (with an academic discount) for PwC’s Comperio ---
http://www.pwcglobal.com/comperio
The single-user limitation really has not been problematic for us.
Our Library guru wrote some front end code that lets any Trinity
faculty member or student go directly into Comperio without having
to remember a password
Comperio
evolved out of a CD-Rom database that Price Waterhouse sold under
the name “Price Waterhouse Researcher.” Updated CDs were sent to us
each quarter in the old days before things were as networked on the
Web. Now it’s all Comperio on the Web.
Andersen
had a competing CD database called Research Manager. That was bought
out after Andersen fell, but I think it is now defunct (I could be
wrong about this).
Now
Comperio is the main commercial database available other than FARs
---
http://www.fasb.org/fars/
I think each student can buy this from Wiley, but there have been
numerous complaints about it.
PwC's Comperio Accounting
Research Manager
Comperio
is the most comprehensive on-line library of financial reporting
and assurance literature in the world. Over 1,500 financial
executives from around the world use Comperio on a daily basis.
Comperio content includes AICPA, DIG, EITF, FASB, IAS, ISB and the
SEC as well as pronouncements and standards from Australia,
Belgium, Canada, New Zealand and the United Kingdom.
With
Comperio, the answers you need are always available - right now,
right at your fingertips. There is no software to install - just
go to the Comperio website and start researching!
The
entire online library can be immediately accessed by browsing a
pronouncement or topic directly, or by searching the entire
database for key words, topics or terms.
Visit the
Comperio product information site at http://www.pwcglobal.com/comperio
. You will find the necessary forms to order Comperio today or to
request a 30-day free trial.
Andersen's old Accounting
Research Manager is now updated and maintained by CCH. The AICPA
has accounting research literature in the FARs database.
For
national and international accounting rulings and online research, it is best to
subscribe for a fee to one of the leading services shown below:
PwC
Comperio ---
http://www.pwcglobal.com/comperio
CCH
Accounting Research Manager ---
http://www.accountingresearchmanager.com/ARMMenu.nsf/vwHTML/ARMSplash?OpenDocument
AICPA FARs
(marketed by Wiley) ---
http://www.fasb.org/fars/
For looking up filings with the SEC,
there are two major sources:
EDGAR ---
http://www.sec.gov/edgar/quickedgar.htm
PwC EdgarScan ---
http://edgarscan.pwcglobal.com/servlets/edgarscan
It is possible to do comparative
company financial analyses using the core earnings databases ---
http://faculty.trinity.edu/rjensen//theory/00overview/theory01.htm#CoreEarnings
Many IFRS and multiple nation standards
and reviews are available from Deloitte's IAS Plus ---
http://www.iasplus.com/index.htm
Free International
Auditing Standards
All documents issued by IFAC and the International Auditing
and Assurance Standards Board (IAASB) are now available for immediate download
at no charge. Visitors must simply fill out a one-time registration to gain
access to the documents. http://www.accountingweb.com/item/96952
Bob Jensen's search helpers are at http://faculty.trinity.edu/rjensen/searchh.htm
Accounting topic search helpers --- http://faculty.trinity.edu/rjensen/searchh.htm#Accounting
Note that most of these are not repeated below, so please click on the above
link.
A Selected Listing of Accounting
Textbooks from AccountingStudy.com --- http://accountingstudy.com/books/textbook/
Most of these books are not available online, but many have online supplements.
There are very surprising omissions.
For example, under Financial Statement Analysis, I view Stephen Penman
'
s Financial Statement Analysis and Security Valuation Book (Irwin
McGraw-Hill) as the best book available, but AccountingStudy.com left it out
of the list in favor of books I respect much less such as the Palepu,
Healy, and Bernard book (which has a recent cheap shot inferior
revision) and the badly outdated Foster Book (1986).
Under Managerial Accounting, the lead
selling book by Garrison and Noreen (McGraw-Hill) is not included in the list.
Flat World Knowledge will no longer publish versions of its textbooks at
no charge ---
http://www.insidehighered.com/news/2012/11/05/flat-worlds-shift-gears-and-what-it-means-open-textbook-publishing
Jensen Comment
At $19.95 a Flat World book may sound like a real deal compared with a
competitor's $180 alternative. But keep in mind that the higher priced textbook
may be more current and have much better exhibits, end-of-chapter material, and
multimedia supplements. As a rule the more expensive versions have value added
unless there are some unfair marketing tactics employed (such as giving
instructors 20 free copies that they can sell in the lucrative cash market
offered by the sleazy guys prowling around faculty offices).
Also keep in mind that students may sell the $180 textbooks back to campus
bookstores for as much as $90. There's not much a used book market for books
published by Flat World.
"Textbooks for Tightwads: As classes start, business students are in
for a shock: Textbook prices are higher than ever. A word to the wise: It pays
to shop around," by Rachel Z. Arndt, Business Week, August 26, 2009
---
http://www.businessweek.com/bschools/content/aug2009/bs20090826_069900.htm?link_position=link1
Shopping for textbooks can be burdensome at best,
painful at worst. And it's no different for business students. By the time
students get to B-school, they're probably well-versed in the tricks of the
textbook trade. They need to be, with some books required at top B-schools
retailing for well over $200.
Although textbook shopping is as inevitable as
picking classes or group projects, spending tons of money on books doesn't
have to be part of the process. The catch is knowing what you're doing,
which isn't as obvious as it sounds, even for students with top-of-the-line
spreadsheet skills. Of course, you can still look for the least beat-up copy
in the campus bookstore, but that should be just the beginning.
The Web is overflowing with sites claiming to offer
the cheapest textbooks around. So, with book prices rising, the cost of
higher education higher than ever, and a dreary economy to boot, it'll
certainly pay off to spend some time shopping around. Publishers may be
resourceful, but students are, too.
An Oligopoly
To say they have to be is an understatement. The General Accounting Office
says textbook prices have increased at twice the rate of inflation since
1986. And today, students spend on average about $700 per year on required
course materials, according to a 2008 survey by the National Association of
College Stores (NACS).
Part of the problem is rising production costs, but
the textbook market itself plays a role. The industry is an oligopoly, says
James V. Koch, president of Old Dominion University, in a 2006 report by the
U.S. Education Dept. Advisory Committee on Student Financial Assistance.
According to Koch, five publishers—Thomson, Wiley, Houghton-Mifflin,
Pearson, and The McGraw-Hill Companies (Businessweek's parent)—control the
market, putting out about 80% of all college texts.
What's more, Koch says, the textbook market is
unique. Unlike markets for most consumer products, where demand is generated
by consumers themselves, textbook demand is created by another group: the
faculty choosing texts for their classes. That makes it possible for
publishers to introduce higher prices without much&mdashlif any—loss in
revenue.
Publishers can also introduce "bundled" versions of
books—books sealed with additional CD-ROMs or other materials—for higher
prices. This means, even if just the book itself is required, students are
stuck buying a more expensive version.
Tricks of the Trade
But the situation for students isn't as dire as it sounds. First of all, as
some economists point out, students are smart and know how to consume. Yes,
textbooks are expensive. But they are expensive at list price—usually the
highest price a student can find. The prices charged by most bookstores,
online retailers, and even online trading posts are well under this
publisher-set price.
As BusinessWeek found out, those retail prices can
vary wildly, which is why it pays to shop around. One of the easiest and
fastest ways to find the best prices is to use a site that aggregates prices
from many retailers. Booksprice.com and allbookstores.com are good places to
start. They both list prices from the most popular Web retailers, such as
alibris.com, half.com, bookbyte.com, and even Amazon.com. If aggregated
searches aren't turning up the results you want, you can go to individual
retailers' sites. Make sure to know the edition, author, and publisher of
the book you're looking for—some books, on topics such as microeconomics,
share the same title for completely different products.
Expect some surprises. Sometimes a retailer will
sell the new version of a textbook for much less than a used copy. Abebooks,
for example, charges $69.99 for a new copy of Jonathan Berk's and Peter
DeMarzo's Corporate Finance and $120.54 for a used one. It's unclear why
this happens, but one possibility might be that the owners of the used books
simply overpriced their product.
Continued in article
Jensen Comment
Keep in mind that the campus bookstore probably will buy back a book that they
did not sell originally.
Thompson Learning's WebTutor --- http://snipurl.com/WebTutor
McGraw-Hill --- http://www.mhhe.com/catalogs/
Prentice-Hall --- http://vig.prenhall.com/
http://www.cybertext.com/
http://www.wadsworth.com/
http://www.prenhall.com/
South-Western College Publishing --- http://www.swcollege.com/
- RJ Interactive Home Page (Online
Accounting, Publishing) (Richard J. Campbell)
Taxpoint: http://taxpoint.swcollege.com/taxpoint_2001/taxpoint.html
StudyLive: http://www.swcollege.com/acct/studylive/studylive.html
INTACCT: http://www.swcollege.com/acct/rama/intacct/intacct.html
Computerized Principles of Accounting: http://www.swcollege.com/acct/klooster_introacct/klooster.html
The European Case Clearing House (ECCH) homepage is at http://www.ecch.cranfield.ac.uk/
COLIS: Case Searching by Internet --- http://www.ecch.cranfield.ac.uk/europe/pages/search/index.html
COLIS is the single most comprehensive electronic bibliography of management
case study and reprint materials in the world. Regularly updated, COLIS contains
abstracts of over 30,000 case studies, journal article reprints and
supplementary materials, many with inspection copies on-line for immediate
previewing.
ON-LINE INSPECTION COPIES
In December 2003 99 new on-line inspection copies were added to COLIS.
The total number now available to view on-line is 7,358.
Electronic Delivery
Who is
eligible?
Electronic delivery is only available to full educational and
corporate members
of ECCH.
What is
available?
Case masters
The facility to reproduce cases in-house is available to
eligible organisations. In granting permission to copy, ECCH
supplies a complimentary case master and charges for the
number of copies to be made for teaching*.
The member organisation has the choice of receiving the master
in either paper or electronic format**. |
Teaching notes
A large proportion of the cases distributed by ECCH have
accompanying teaching notes which are available separately.
These may be delivered electronically**
for use only by named faculty members in educational
organisations and named trainers in corporate training
departments. |
What are
the advantages?
Electronic delivery eliminates shipping charges and ensures case
materials are received within one working day**.
How does
it work?
Materials delivered electronically will be supplied as sealed (ie
encrypted) pdf files, thus fulfilling ECCH security requirements.
Customers will receive the sealed files as an e-mail attachment.
Demonstration
|
If you
require further information or you would like to see a
demonstration please contact Lucy Baldwin at la.baldwin@ecch.cranfield.ac.uk
or on
+44 (0)1234 756420. |
EECH has, with the co-operation of most case-authoring institutions,
recently introduced a concessionary pricing program (CPP) to provide
business schools in 65 underdeveloped nations affordable access to cases
for use in public education programs --- http://www.ecch.cranfield.ac.uk/cpp/
Until now, ECCH's efforts have concentrated
largely on encouraging the use of cases within business schools and
companies situated in the developed economies of the world. Schools in
developing countries have been effectively excluded from obtaining
ECCH's materials due to price.
In response, ECCH has introduced a scheme (CPP)
to make cases and associated materials more accessible to educational
institutions in the developing world.
Top Ten Emerging Technologies According to CFO Magazine in October
2002
THE NEED-TO-KNOW LIST
1.
XBRL
2. Business Intelligence
3. Wireless Connectivity
4. Grid Computing
5. Multivariable Testing (MVT)
6. Digital Cryptography
7. Rich Media
8. Internet2
9. Biometrics
10. Small Technology
XBRL tops the list. Bob Jensen's threads on XBRL are at
http://faculty.trinity.edu/rjensen/XBRLandOLAP.htm#XBRLextended
You can order back issues or relevant links management and accounting books
and journals from MAAW --- http://maaw.info/
Free Access to Back Issues of The Accounting Review ---
http://maaw.info/TheAccountingReview.htm
International Accounting News
(including the U.S.)
AccountingEducation.com and Double Entries ---
http://www.accountingeducation.com/
Upcoming international accounting conferences ---
http://www.accountingeducation.com/events/index.cfm
Thousands of journal abstracts ---
http://www.accountingeducation.com/journals/index.cfm
Deloitte's International Accounting News ---
http://www.iasplus.com/index.htm
Association of International Accountants ---
http://www.aia.org.uk/
WebCPA ---
http://www.webcpa.com/
FASB --- http://www.fasb.org/
IASB --- http://www.fasb.org/
Others ---
http://faculty.trinity.edu/rjensen/bookbob1.htm
Gerald
Trite's great set of links ---
http://iago.stfx.ca/people/gtrites/Docs/bookmark.htm
Richard
Torian's Managerial Accounting Information Center ---
http://www.informationforaccountants.com/
Ethics
Study
Hi Iman,
There are many useful sites, and I am
sorry to say that I have not cataloged Websites on social accounting. A
few sites that might help you get started are listed below (although not all
links are focused at financial reporting):
Introductory Reading Lists
http://scout.cs.wisc.edu/archives/SRA--LCSHSearch.php?SubjectID=9907
http://www.gla.ac.uk/departments/accounting/csear/studentresources/introread.html
http://www.business-ethics.com/web-ethi.htm
http://webapps.unl.ac.uk/apps/faq/cf_tag_verity_detail.cfm?ID=510§ionname=Library
History
http://www.sustainability.com/programs/engaging/history-reporting.asp
Journals --- http://www.mbs.unimelb.edu.au/library/mconline/serials/Serindex.htm
Special Issue of the European
Accounting Review --- http://www.bham.ac.uk/EAA/ear/conts/volume9.html
The Ecologist --- http://www.theecologist.org/links.html?section=48
UK Organizations --- http://cei.sunderland.ac.uk/ethsocial/orgs.htm
http://www.ids.ac.uk/eldis/hot/ethicsguide2.htm
Especially note the Subject Guides
Ponemon --- http://www.ftc.gov/acoas/nominations/ponemonbio.htm
India and Bangladesh --- http://www.mimap.org/index.cfm?fuseaction=viewrep&doctype=Research
THE NEED FOR FUNDAMENTAL RESEARCH IN
ISLAMIC ACCOUNTING ---
http://islamic-finance.net/islamic-accounting/acctg.html
Social Indicators --- http://www.ccsd.ca/si_exec.htm
Impact Assessment
http://www.enterprise-impact.org.uk/pdf/EINDecember01.pdf
http://www.ag.unr.edu/uced/reports/technicalreports/9899reports/9899_04rpt.pdf
Radical Disclosure Theories --- http://www.commerce.adelaide.edu.au/courses/at3/slides/disclosuresocialacc2001.pdf
Unaccountable Accounting --- http://www.commondreams.org/views02/0128-02.htm
Misc.
http://www.warwick.ac.uk/fac/soc/Economics/research/resdevel.htm
http://www.neweconomics.org/default.asp?strRequest=areasofwork&pageid=57
http://www.sums.ac.uk/staff/owen.htm
http://www.foe.org/international/cswg/
http://www.cbs-network.org.uk/SocAdbib.html
Great Old Stuff
PHANTASMAGORIC ACCOUNTING: Research
and Analysis of Economic, Social and Environmental Impact of Corporate Business
(Sarasota, FL: The American Accounting Association, 1977).
Hope this helps!
Bob Jensen
Dear Dr.
Jensen,
My name is
Iman Aref. I'm a student at the American University in Cairo, majoring
in Accounting. I'm currently doing a research paper on the Social
Responsibility of Financial Reporting. I was wondering if you know of
any credible websites or links you can refer me to?
I did try
searching the WWW for the topic, but unfortunately, I was unlucky.
Thank you for
your help.
Iman Aref
Bob Jensen's Brief Summary of Accounting
History --- http://faculty.trinity.edu/rjensen//theory/00overview/theory01.htm
History of the Securities and Exchange
Commission (SEC) --- http://www.sechistorical.org/
-
Shared Open Courseware (OCW) from Around
the World: OKI, MIT, Rice, and Other Sharing Universities ---
http://faculty.trinity.edu/rjensen/000aaa/updateee.htm#OKI
-
- Free online electronic literature,
including free textbooks ---
http://faculty.trinity.edu/rjensen/ElectronicLiterature.htm
-
Free Mathematics and Statistics Tutorials ---
http://faculty.trinity.edu/rjensen/Bookbob2.htm#050421Mathematics
Free Science and Medicine Tutorials ---
http://faculty.trinity.edu/rjensen/Bookbob2.htm#Science
Free Social Science and Philosophy Tutorials ---
http://faculty.trinity.edu/rjensen/Bookbob2.htm#Social
Free Education Discipline Tutorials ---
http://faculty.trinity.edu/rjensen/Bookbob2.htm
Teaching Materials (especially
video) from PBS
Teacher Source: Arts and
Literature ---
http://www.pbs.org/teachersource/arts_lit.htm
Teacher Source: Health & Fitness
---
http://www.pbs.org/teachersource/health.htm
Teacher Source: Math ---
http://www.pbs.org/teachersource/math.htm
Teacher Source: Science ---
http://www.pbs.org/teachersource/sci_tech.htm
Teacher Source: PreK2 ---
http://www.pbs.org/teachersource/prek2.htm
Teacher Source: Library Media ---
http://www.pbs.org/teachersource/library.htm
Free Education and
Research Videos from Harvard University ---
http://athome.harvard.edu/archive/archive.asp
VYOM eBooks Directory ---
http://www.vyomebooks.com/
From Princeton Online
The Incredible Art Department ---
http://www.princetonol.com/groups/iad/
Online Mathematics Textbooks ---
http://www.math.gatech.edu/~cain/textbooks/onlinebooks.html
National Library of Virtual Manipulatives ---
http://enlvm.usu.edu/ma/nav/doc/intro.jsp
Moodle ---
http://moodle.org/
The word moodle is
an acronym for "modular object-oriented dynamic learning
environment", which is quite a mouthful. The Scout Report
stated the following about Moodle 1.7. It is a tremendously helpful
opens-source e-learning platform. With Moodle, educators can create
a wide range of online courses with features that include forums,
quizzes, blogs, wikis, chat rooms, and surveys. On the Moodle
website, visitors can also learn about other features and read about
recent updates to the program. This application is compatible with
computers running Windows 98 and newer or Mac OS X and newer.
Some of Bob Jensen's Tutorials
-
Damodaran Online: A Great Sharing Site from a Finance Professor at New
York University and Textbook Writer ---
http://pages.stern.nyu.edu/%7Eadamodar/
Jim Mahar's finance sharing site (especially note his great
blog link) ---
http://financeprofessor.com/
Financial Rounds from an anonymous finance professor ---
http://financialrounds.blogspot.com/
- The AICPA Issues Business Fraud Case Studies --- http://www.aicpa.org/antifraud/spotlight/030409_cases.asp
-
- TheAICPA has made its Year 1992 through
Year 2000 Accounting Educators Conference Professor/Practitioner Cases
available. See http://www.aicpa.org/members/div/career/edu/ppcdp.htm
-
- Accounting
Coursepage Exchange (ACE) - American Accounting Association
Jensen & Sandlin Survey of U.S. Accountancy Education
Programs
Bob Jensen's Web Site
Innovation in Accounting Education Award 1999 Submissions to the
American Accounting Association
(I will review some of these documents in future editions of New
Bookmarks)
http://www.rutgers.edu/Accounting/raw/aaa/facdev/teaching/awardsub.htm
AICPA Professor/Practitioner Case Development Program
Please be informed that the winning case materials (student notes only) are now available
on the Institute Web site at http://www.aicpa.org/members/div/career/edu/caseidx.htm.
- ACCT 5341
(International Accounting Theories)
- ACCT 5342 Accounting
Information Systems
- Study Web
WebCT Homepage (Wayne Ingalls' Accounting
Courses)
- Accounting Theory
Course in Australian National University)
- ACCOUNTING SOURCES
(Pamela Jarvis)
Brown and O'Leary
Tutorial
- 6E:002 RealAudio
Lecture Home Page (University of Iowa, Real Audio)
- Introductory
Accounting I Virtual Course (Barry Rice, Loyola College)
- Management
Accounting Modules
- OptionSource.Com Home Page (Options
Trading Tutorials)
- AC3029Accounting
Systems
- Stonehill College: Programs in
Accountancy
- KenyonCollege - Academic Projects on the Kenyon Web
- Favorite Sites --
Accounting, AIS & MIS Students & Professionals (Shared Course Materials)
- Favorite Sites --
Accounting, AIS & MIS Students & Professionals (Accounting and AIS Links)
- AAA IS/MAS Homepage
Management Accounting Section of the American Accounting
Association
Management Accounting Modules
- Accounting and Financial Information
Welcome to CAROL (online annual financial reports)
- http://www.isworld.org/isworld.html
- Master Budget-Master
Index
- Peter Kenyon at Humboldt State University
- SMAP 96 Homepage
- Spiceland's Course
Resources
G. Gray at CSUN
- Great Ideas in Teaching Accounting
- Intermediate Accounting - UC Santa
Barbara
- Introduction to Management Accounting
- NSNS Syllabits: Accounting Syllabi
- Riding the
Information Superhighway - Course Syllabus
- Slides on "Why
[Study] Accounting?"
- Tax Resources (U. of
Iowa)
- Tax World Homepage
- US University's
Accounting Departments
- High Q Learning Products - Courseware -
Software - Accounting Courseware, Accounting Education, Accounting Training
- Consumer Behavior
Book With Online PowerPoint and Cases
- AC3029 Accounting
Information Systems (AIS)
- Yale SOM Accounting
Home
Every now an then I stumble on a very helpful website with many
links. One of these is @theBeech from SUNY College at Fredonia. Thank
you Fredonia for sharing these links on education in general and on
accounting education in particular The main website is at http://beech.ait.fredonia.edu/teaching.htm
Learning Skills Links --- http://beech.ait.fredonia.edu/learning.htm
Teaching Resources Links --- http://beech.ait.fredonia.edu/teaching.htm
The above links are very comprehensive --- I recommending making
bookmarks on these pages.
For other education links go to http://faculty.trinity.edu/rjensen/bookbob2.htm
Some Course Web Pages Supported from SUNY College at Fredonia --- http://beech.ait.fredonia.edu/course/default.htm
Newsgroup messages are located at http://beech.ait.fredonia.edu/newsgroups.htm
Some Accounting Career Information from SUNY College at Fredonia --- http://beech.ait.fredonia.edu/careers.htm
This is a great website with lots of useful links
about accounting careers, continuing education, and certification
specialties.
In particular, note the Accounting Career Information Link at http://beech.ait.fredonia.edu/careersac.htm
-
-
- From Phil Livingstone, President of the Financial Executives
Institute (since this is linked from the Download Archives that anybody can access, I
assume that this Excel Workbook is available to the general public)
Acquisition Model - Bruce Valentine, CFO of McStain
Homebuilders, and a member of the Rocky Mountain Chapter, contributed a great Excel
workbook for pro forma acquisition modeling. It takes the historical and projected results
of the seller and buyer and combines them with consideration of the accounting and tax
treatments. Thanks so much to Bruce for this great contribution to all FEI members.
Ive known and worked with Bruce and he is a bona fide rocket scientist.
I believe FEIs future will contain much more
model- and presentation- sharing. Please think about the tools you use or tools you need
and send me e-mail if you want to contribute something or are looking for a particular
tool. Web-enabled tools for information sharing and analysis should be a priority.
Go to http://www.fei.org/download/dl_index.htm
(Then click on MS Excel Acquisition Model.
Bruce Valentine)
Charles A. Dice Center for Research in Financial Economics http://www.cob.ohio-state.edu/~fin/dice/index.htm
-
The New Hampshire Society
of CPAs has a rather nice service providing abstracts of articles of
interest to accountants --- http://www.nhscpa.org/May2002News/enews.htm
- Index for ACCT 5341
(International Accounting Theories)
Study Web
- Developing World
Wide Web pages at Cornell
- Lessons from Business School Web Sites
- ECO/FIN/INBhome
- University of
Newcastle Department of Economics
- Finance--UC
Berkeley, Brad De Long's Shared Course Materials, Shareware, Education)
- Pamela P. Peterson
(FIN 3403, Accounting Financial Statements, Shared)
Homepage For David Boldt (economics education)
Charles A. Dice Center for
Research in Financial Economics
- Bob Jensen's Links
Globalization Strategic Alliances
Roundtable (GSAR), Berlin, Germany, June 22, 2001 ---
http://www.cs.trinity.edu/~rjensen/GSAR2001/000start.htm
-
Accounting Journals Index
Accounting, Finance,
Business, and Other Glossaries
Jensen & Sandlin Survey of U.S. Accountancy Education
Programs
AuditNet Home Page (Includes
link to Auditors Sharing Audit Programs (ASAP) page
- BUSINESS RESOURCES
Business Resource Archive - Accounting
Online Calculators
Guides to using a financial calculator without having to be confused by the manual
http://moon.pepperdine.edu/~mkinsman/Using.html
Ernst & Young LLP - Download Library
- SFAS 133 Financial Instruments Derivatives
- Ernst & Young
LLP - Download Library - SEC Rules on Financial Instruments Derivatives
InfobyteHomepage (Accounting, General Ledger Software)
- Wow International Accounting Helper
Site
Paul is a former student during my years at Michigan State University
and has been project director of various FASB and IASC accounting
standards before joining Deloitte on special assignment in Hong Kong.
Hello Bob,
As part of my work
at Deloitte here in Hong Kong, I have developed IASPLUS, which is
both a web site (http://www.iasplus.com)
and a quarterly printed newsletter (the latter is available on the
website in electronic form). The website and newsletter are
devoted to the development, dissemination, understanding, and use of
International Accounting Standards. Both include
country-specific information -- currently limited to Asia but soon
to be expanded to include Europe and beyond.
I thought these
might be of interest for your bookmarks.
I enjoyed our
panel together at the AAA. I hope to see you this summer at
the Atlanta meeting.
Paul Pacter
Reply from John Phillips [jphillip@UOG9.UOG.EDU]
on March 7
This is a great site it provides details
not only on IAS but on the countries of the world as to their
accounting standards and CPA organizations
Distributed Network General Ledger Software and
Services
Bob Jensen's Threads on Webledgers
for Distributed Network Computing of Accounting Systems and Business
Services http://faculty.trinity.edu/rjensen/webledger.htm
-
Just for Educators from the AICPA --- http://www.aicpa.org/edu/justedu.htm
Free CPA Review Course ---
http://cpareviewforfree.com/
Center for Financial Research & Analysis,
Inc.
CFRA, Inc. Launches Free On-Line Service for
Academic Community
Rockville, MD - August 1 - The Center for
Financial Research & Analysis (CFRA, Inc.), a leading provider of
independent research to over 2,000 institutional investors, will now
offer an academic version of its product to professors and their
students. Since there is no cost for this service, its use is
restricted for research and teaching purposes.
What's included with the Academic Version?
1. Access to all educational pieces in our
database. 2. Access to selected company-specific reports that focus on
quality of earnings issues 3. Weekly e-mail notification of new
companies added to the database
Who qualifies for this service and how can
you sign up?
All professors teaching courses in financial
accounting, auditing, and finance qualify. To sign up, click on the
URL http://www.cfraonline.com
and register. Then sign and fax the agreement to (301) 984 8617. Once
activated, you will have access to the Academic Version of CFRA's
database.
About CFRA
CFRA has become known internationally for its
pioneering research ferreting out companies with operational problems
that use unusual accounting practices to camouflage such practices.
Founded in 1994 by Dr. Howard M. Schilit following a 20 year career as
an accounting professor (author of FINANCIAL SHENANIGANS: How to
Detect Accounting Gimmicks and Fraud in Financial Reports) http://www.cfraonline.com/publications/publications.jsp#FinancialShenanigans
CFRA provides a daily on-line news wire of financial analysis and a
database on over 900 companies. Its mission is to warn investors and
creditors about companies experiencing operational problems and
particularly those that employ unusual or aggressive accounting
practices to camouflage such problems.
Howard Schilit
http://www.cfraonline.com
301-984-1001 ext. 105
The University of Kansas International Business Resource Connection
http://www.ibrc.bschool.ukans.edu/
The IBRC, a business outreach program of the Center for
International Business Education and Research (CIBER) within the School
of Business at the University of Kansas,
was created to encourage trade opportunities and expand international business
education. Through strategic alliances with major partners (including the U.S.
Department of Education and the Kauffman
Foundation), private sector affiliates, faculty and students at the
University of Kansas, the IBRC assists small and medium-sized Kansas companies
explore available trade opportunities and broaden international business skills.
Particular emphasis is placed on the emerging role of electronic communication
resources (the Internet) in developing international business opportunities for
firms located in the heartland of the United States.
Also, don't forget
Paul Pacter's great international accounting site at http://www.iasplus.com/
- AMIS Faculty Home
Pages
- Fisher College of Business
- In the Classroom
- Waleed Muhanna's
Home Page
Wikipedia has a rather
nice summary of accounting software at
http://en.wikipedia.org/wiki/Accounting_software
Bob
Jensen’s accounting software bookmarks are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
For Educators
Bob Jensen's threads on tools and tricks
of the trade are at
http://faculty.trinity.edu/rjensen/000aaa/thetools.htm
"So you want a new desktop accounting package?"
by David Carter, AccountingWeb, June 5, 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=103569
David does not mention my oft-preferred alternative of a
Webledger system (such as NetSuite) that can be accessed at a range of needs and
sizes and prices with some huge advantages over installing accounting software
on your own hardware --- at
http://faculty.trinity.edu/rjensen/Webledger.htm
Bob Jensen's helpers on accounting software
alternatives are
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
The Tax Adviser:
2019 tax software survey ---
https://www.thetaxadviser.com/issues/2019/sep/2019-tax-software-survey.html
2018 CPA Journal: Finding the Right Tax Software
---
https://www.cpajournal.com/2018/11/12/finding-the-right-tax-software/
Peachtree Accounting Practice Sets ---
http://www.perdisco.com/peachtree/
"Technology 2012 Preview: Part 1 Experts explain what should be at the top
of your tech wish list for the new year," by Jeff Drew, Journal
of Accountancy, November 2011 ---
http://www.journalofaccountancy.com/Issues/2011/Nov/20114310.htm
December 3, 2011 message from Rick Newmark
For collaboration tools, we used Sharepoint in our
intro to MIS course, which is required for all business students. Since we
adopted Pearson products, Pearson provided with the full version of
Sharepoint and 200 access codes. Students can rent the ebook for 180 days on
Coursesmart for $24 (list price of hard copy is $56). My techphobic students
struggled with learning Sharepoint, and all of us, I included, did take some
time to get the hang of it. I think Sharepoint makes a great tool for an AIS
course because students have to make many security/control/access decisions
for their own group sites. For example, what kind of permissions do you
grant to various people/groups? How are you going to control access to
documents? Are you going to use check-out/check-in for documents or are you
going to let multiple people edit simultaneously?
I am going to use it in my graduate AIS course next
semester for the reasons stated above and because they will likely use
Sharepoint or some other set of collaboration tools in their professional
careers.
Rick Newmark
Business Technology from Business Week Magazine ---
http://bx.businessweek.com/business-technology/
The Journal of Accountancy has a great monthly technology section
(with particular focus on things you never, ever thought you could do with MS
Office, particularly Excel) ---
http://www.journalofaccountancy.com/
The Q&A modules are particularly informative and should be centralized in one
place in addition to monthly editions.
Bob Jensen's threads on accounting software ---
http://faculty.trinity.edu/rjensen/bookbob1.htm#AccountingSoftware
Bob Jensen's threads on education technology ---
http://faculty.trinity.edu/rjensen/000aaa/0000start.htm
RIP: The End of Microsoft Office
Accounting
Microsoft is formally backing away from the small
business accounting market after announcing that the Office Accounting program
will no longer be distributed after November 16, 2009. In addition, the
Microsoft Professional Accountant's Network (MPAN) will no longer accept new
members as of that date.
AccountingWeb, November 4, 2009 ---
http://www.accountingweb.com/topic/technology/end-microsoft-office-accounting
Bob Jensen's accounting software threads are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
Software Buying Guides
SMB
Finance and Accounting Checklist
February 6, 2008 message from CHRISTINE KLOEZEMAN
[ckloezem@PRODIGY.NET]
At Glendale Community College in California we
teach our Financial Accounting and Basic Accounting without a computerized
accounting program. I have previously included both a tutorial computerized
accounting program and later a commerical accounting program. It took too
much time out of the class that meets 5 hours a week.
Instead we have a Computerized Accounting class
that uses Quickbooks Pro that is required for the Accounting AA. We also
have Payroll accounting that uses Quickbooks pro. We were using Business
Works (lower version of MAS 2000) but Quickbooks was suggested by our
Advisory Committee. We also have a Advanced Computerized Accounting class
that teaches Peachtree and others. We also require students to take Excel to
get both a certificate and an AA.
Christy
February 6, 2008 message from Carol Flowers
[cflowers@OCC.CCCD.EDU]
We have the financial /managerial accounting class
meeting 5 hours per week and using epacks. However, we have a "computerized
accounting" course that stands alone and is required for an AA degree. In
that course, the student completes an integrated accounting package and also
excel. We also offer stand alone courses in Quickbooks, Payroll and MAS
90/200.
We have found that our population learns the
concepts better with pen and paper (for lack of a better word) and then we
use the Computerized Accounting to re-enforce their principles while
exposing them to industry software and excel.
June 7, 2007 message from Ray Slager
[slgr@CALVIN.EDU]
I wonder if anyone is currently using commercial
software in their courses. I tried to use QuickBooks at one time but the
company makes it very difficult to use. First of all it must be loaded on
each computer - not on the network. Secondly it needs to be updated each
quarter for the payroll module to work and of course the entire package must
be "upgraded" every two or three years. Does anyone know if this is still
the case?
Does anyone use other commercial software that is
easier to administer? I currently am using MYOB and find it very easy to
use. I currently am looking at their latest version and think it is very
promising. It can be loaded on a file server and comes in a "10 pack" - good
for use on 10 computers for about $300.
Ray Slager
Calvin College
June 7, 2007 reply from Davidson, Dee (Dawn)
[dgd@MARSHALL.USC.EDU]
We use Peachtree and get the software free for the
network. Use this link.
http://www.peachtree.com/training/educational_partnerships.cfm
Find the license and application forms. Fax them to
Peachtree and the software CD will be mailed to you. They send you last
year's version - we just received 2006 - but the changes are very minimal
year to year. Each spring we send in the forms and get a new CD to be
installed on the network for the following school year. We develop our own
exercises, but they also have education material available. Hope that helps.
dee davidson
Leventhal School of Accounting
Marshall School of Business
University of Southern California
(213)740-5018 tel (213) 747-2815 fax
dgd@marshall.usc.edu
June 7, 2007 reply from Formosa, Jim
[Jim.Formosa@NSCC.EDU]
We are using QuickBooks but are looking at
Microsoft's accounting software for small business. We have the same
problems you describe with QuickBooks.
Jim Formosa, MS, CPA
Certified Senior WebCT Trainer
Associate Professor of Accounting
Nashville Community College
615-353-3420 FAX 615-356-1213
June 7, 2007 reply from Fisher, Paul
[PFisher@ROGUECC.EDU]
I have found that Peachtree is much better. I am
running an older version, but it does not seem to matter. Peachtree provides
an educational version that does not lock the student out after 25 visits,
and does not have the payroll deadfall. It also has a "tutorial"
embedded that makes it almost textbook free if you
are willing to produce class handouts. I am going to be attempting
Timberlake for a construction program. Anyone have experience in that?
Paul
June 7, 2007 reply from Prachyl, Cheryl L
[cprachyl@UTA.EDU]
I use Peachtree. They provide a free educational
site license. The educational version is one year behind the currently
marketed version, but I don't find that to be a problem.
I tried using Quickbooks for one semester but we
had no money in our budget to purchase the software. We got a donation to
the department for a one year site license but we had problems with the
installation in our labs.
I have found that Peachtree works well. It also can
reinforce the "cycle" approach to business through the navigation aids.
Cheryl Prachyl
University of Texas at Arlington
June 7, 2007 reply from Leslie Kren
[lkren@UWM.EDU]
I use SAP in my cost management courses. SAP is the
leading ERP system and using it in the classroom provides exposure to the
'big systems' most of our students see in practice. The startup cost for me
was quite high several years ago, but now the SAP University Alliance is
quite active and provides summer workshops and substantial assistance with
instructional materials to interested faculty.
Leslie Kren, PhD, CPA
Associate Professor
Lubar School of Business
University of WI - Milwaukee
3202 N. Maryland Milwaukee, WI 53201
414 229-6075 fax: 414 229-6957
lkren@uwm.edu
http://www.uwm.edu/~lkren/
June 8, 2007 reply from David Fordham, James Madison
University [fordhadr@JMU.EDU]
Ray,
I guess my answer is no and yes. I don't use it in class, but I use it in
the course.
The first half of our basic systems course is spent
on systems concepts relating transaction cycles and the traditional
accounting systems flows and operations. We don't demonstrate any commercial
software, we mainly concentrate on manual paper document flow to teach them
the use of documents like reqs, PO's, receiving vouchers, invoices, etc. and
mention that "most of this flow is now computerized." During the second half
of the course, while the classroom activities are covering stuff like REA
(organization), XBRL (retrieval and reporting), SDLC, information security,
PoET, networking, etc., the students are engaged in a lengthy homework
assignment (5 weeks long): a group project wherein they, without help or
assistance from anyone, keep the books for a small hypothetical company for
a month (the shoebox full of receipts concept), by using a commercial
software package of their choosing.
They not only choose the package, they must buy it,
and then teach themselves how to use it, on their own. This includes setting
up the master files, creation of the chart of accounts (or modification of
the stock chart to eliminate the hundreds of fluff accounts not required by
this company), entry of the month's of data, creation of reports (including
some involving the report writer), plus the internal controls necessary for
the company to use their particular software package, which might involve
form design and creation, etc.
The project is done in student groups (3, 4, or 5
students). The students must first evaluate several packages, and then get
approval from the professor for the package of their choice. Since I don't
use a textbook for the main part of the course, I expect them to pool and
spend their "Textbook" money on a legal copy of the commercial software
($150 per student should give them about $400-700 for software, although
some groups try to find suitable packages for under $300). I'd say the
average group spends about $400 for their software.
The case is complex enough that the "demo" versions
and the low-end versions of packages like Quickbooks and Peachtree
absolutely won't suffice. In fact, even the mid-range versions won't be
usable UNLESS the group goes to a heckuva lotta trouble designing manual
internal controls, in which case their controls usually begin interfering
with the efficiency and effectiveness of operations. What's more, low-end
package groups often must resort to additional tools to provide some of the
required reporting information: excel, etc., and eventually their accounting
"system in toto" begins to get quite cumbersome. Students learn valuable
lessons in software features versus advertising, features vs. usability,
software-based controls vs. manual controls, etc. Plus, during the
evaluation phase, they get to compare packages based on the criteria we
cover in the first part of the course vis-a-vis the handling of the
critical/non-critical data elements, transfer of data between job fun! !
ctions within the company, etc.
They learn one package well enough to put it on
their resume, and they get some exposure to one or two others. The fact that
they learn it on their own surprises most of my colleagues from my
generation, but I've found that after having the accounting system concepts
explained to them, and getting some "manual or semi-automated" transaction
cycles demonstrated and illustrated, they can pick up the software a whole
lot better than my generation. They use the tutorials, they use on-line help
(they can use any aid except for a living human -- they can't use email
help, for example -- but they can use existing on-line user group posts,
blogs, etc. as long as they haven't posted something to the source in
question). They get two 30-minute "consulting" sessions with the professor
if they get in trouble. Most groups need at least one of those sessions, but
I never need to teach them how to use the software, their problems are
usually more related to efficiency vs. controls.
Yes, it is a boatload of work, for both the
students and for me. But the project counts the same as one of the two major
exams, and although they complain about the amount of work while they are
doing it, in the end, their deliverable is immensely personally satisfying.
Very few of them recocmmend dropping the project from the course (or even
scaling it back) in the end-of-course evaluations.
The ability of today's students to rise to the
challenge of teaching themselves the intricacies of today's complex
commercial software is truly amazing to some gray-haired baby boomers like
myself. Thus, I don't spend class time on any commercial package anymore.
(Yes, some groups do make some mistakes in their
selection, and learning from their mistakes often turns out to be one of the
most effective learning strategies.... this is education, after all, and
mistakes aren't fatal.)
So we use commercial accounting software in the
course, but not in class.
David Fordham
James Madison University
June 10, 2007 reply from Tom Sentman
Hi David,
I really like your approach to exposing
students to accounting software in your class.
Do you teach this course to beginning or
second year students?
What are some of the accounting software
packages your students have used?
Is there a way that I could obtain an
outline and/or syllabus for your course? It would be most
appreciated.
Tom Sentman
Springfield, MO
June 11, 2007 reply from David Fordham, James Madison University
[fordhadr@JMU.EDU]
Tom, my course is designed to be taken in
the junior year, but some put it off until the first semester senior
year. Students arrive having taken principles 1 and principles 2,
plus Intermediate 1. Some have also taken Intermediate 2, Tax, and a
few have even taken Cost. My course is the pre-req for auditing.
Students have used lots of different
packages, but the high-end Peachtree Pro Plus, Great Plains,
Microsoft Small Business Pro, and similar packages (those in the
$250 to $500 price range) seem to be the most popular. My case calls
for more than simple 'sell four products to two customers'. It
requires departmental sales reporting, consignment, commissions,
differing terms for different customers, taxable and non-taxable
sales, different tax rates, freight prepaid and collect, FOB
shipping point and destination, and even some non-traditional stuff
(I call them "easter eggs" because the students have to find them --
critical thinking exercise!) such as a sale that isn't really be a
sale, a sale that might or might not be a sale, a purchase that
isn't really a purchase, etc... I don't stick to the easy
accrual/deferral stuff, I want them to have to stop and think. The
reports I ask for are analyses not normally found in the $19.99
packages.
I use Blackboard for the course, and my
institution is pretty stingy with the guest log-ins since we put
copyrighted materials on our Blackboard webs. Can you give me a
personal email and I'll shoot you a PDF copy of the syllabus and
course calendar.
The case is one that I came up with. I've
been using it and polishing it for about 15 years, and about a dozen
other AIS profs (including Nancy Bagranoff) have used it too, but no
one is interested in publishing it -- I'm too busy to waste time
coming up with the darn "learning bjectives", "teaching notes", and
"assessment instruments" junk that the gatekeepers demand these
days. (I'm at the point in my career where I don't have to lick
quite as many boots as I used to, back in the days when I was young
and foolish...) I'll be happy to send you the case and give you
permission to use it if you think it would help your students. Like
I said, it basically is an exercise in thinking as well as software
learning. What I like about it is that the students have to do this
"on their own", with only two "consulting sessions", so it forces
them to think before they come into my office. It is amazing how
many students rise to such a challenge and can think and think well
when calle! ! d upon. And as I said before, learning software is
something that the kids today can do with their eyes shut (... or
glued to their iPhone, or YouTube, or MySpace, etc.)
David Fordham
PBGH Faculty Fellow
James Madison University
New and enhanced features in QuickBooks 2010 ---
http://www.accountingweb.com/topic/technology/new-and-enhanced-features-quickbooks-2010
39 Free QuickBooks Online Tutorials ---
http://fitsmallbusiness.com/free-quickbooks-online-tutorials/
Thank you Crystalynn Shelton and Kristian Rivera --- |
http://fitsmallbusiness.com/category/accounting/
2008 Quickbooks Update
December 12, 2008 message from Scott Bonacker
[lister@BONACKERS.COM]
Hello
Scott,
Thank you for
contacting me. Here is some information for your records. Click on any of
the hyperlinks below for more information and please let me know if you have
any questions.
The
Instructor's Resource Center for QuickBooks is located at
www.accountant.intuit.com/iep.
Go to
Register Now
and enter your institution's information. If
you do not have your license number (it
is a required field) you
may enter "IEP" in the license number field.
This will give you full access to the fifteen
lesson plans, reviews and PowerPoint presentations. The lesson plans are
for your use only.
DON'T FORGET the
Educator's Corner!
Discussion forums, tools, resources and allows the sharing of curriculum
from review exercises and quizzes to test questions.
Pricing is
as follows for software used for instructional purposes:
Site
licenses come with a 2 year site license agreement to be filled out by the
user and returned to Intuit. Site licenses are strictly for classroom
installation for instructional purposes.
NEW ! ! -
QUICKBOOKS PREMIER ACCOUNTANTS EDITION IS HERE
-
Access other versions of
QuickBooks 2009 through
the Accountants Edition with the
toggle feature.
Click here
to learn more! The
appearance and basic workflows are the same as Pro, but you will also have
access to all versions of QuickBooks 2009
(Simple Start, Pro and all of the Industry Specific Versions).
-
10 Pack $259.95 -
QuickBooks 2009
Premier Accountants Edition for Windows
-
25 Pack
$399.95 - QuickBooks 2009 Premier
Accountants Edition for Windows
-
50 Pack
$599.95 - QuickBooks 2009 Premier
Accountants Edition for Windows
-
2008
QuickBooks Student Guide $36.95. The 2009 text
is be $45.95,
and
includes
a 140 day trial CD that student can install on their personal
equipment.
-
QuickBooks Pro
Academic Version - CLICK
HERE for eligibility requirements and description
QuickBooks Pro for
their individual academic use at a special discounted
price: Bookstores can purchase four or more licenses at
15% discount
direct through Intuit's Education Program. Students can purchase
independently by contacting one of Intuit's approved resellers:
Academic Superstore, (800) 817-2347 or
Genesis, (800) 433-6326.
QUICKBOOKS USER CERTIFICATION
CLICK HERE for more information. Get 50% off the regular price!
Get the Training & Exam for only
$49.98! Please
let me know if this is something you would like to include in your
curriculum. I will need to assign a code to your class so they
receive the discount. Initially each user will need to sign up for
the certification through the web site. Bulk pricing and sign up
will come at a later date.
INTEREST IN PERSONAL FINANCE AND QUICKEN?
- Go to
www.quickeneducation.com for more info.
Additional Resources and Tools
20% off Interactive CD Training!
- A great tool to help you learn and teach QuickBooks in your classroom.
Wonderful for overhead presentations.
ProSeries PowerTax Library
- Free software for educators. For classroom/instructional purposes only.
Click here
to view the License
Agreement
Ordering Information
FAX or
email
- DO NOT MAIL - Purchase
Orders and State Tax Exempt Certificate to 520-844-6412 or
education@intuit.com
The Intuit payment address
that will appear on your invoice is Intuit Inc., PO Box 513340, Los Angeles,
CA 90051-3340
Credit card and EFT orders
are also accepted
If you have any questions,
please feel free to contact me.
LISA SCHWARTZ - INTUIT
EDUCATION PROGRAM -
TUCSON, AZ
(866)
570-3843 - Fax 520-844-6412
education@intuit.com
-
www.accountant.intuit.com/iep
Bob Jensen's threads on accounting education software are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#software
Bob Jensen's threads on accounting software in general are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
Peachtree Accounting Practice Sets ---
http://www.perdisco.com/peachtree/
New and enhanced features in QuickBooks 2010 ---
http://www.accountingweb.com/topic/technology/new-and-enhanced-features-quickbooks-2010
Also see Accounting Software at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
Excel, JavaScript, and Other Helpers
and Videos --- http://faculty.trinity.edu/rjensen/HelpersVideos.htm
Free Access to Back Issues of The Accounting Review ---
http://maaw.info/TheAccountingReview.htm
Auditing and Audit Sampling Software
May 2, 2006 message from Douglas Ziegenfuss
[dziegenf@ODU.EDU]
I teach a graduate IT Auditing course in
which we use both ACL and Idea. Both are taught because both are
used in the business world. We use the version of ACL that comes
with Hall's IT Auditing book. Idea sells the students a version and
workbook for $25 per student and gives us a free copy of the
software and workbook. The students then load the software on their
laptops and bring them to class. This turns any classroom into a
lab. The students generally like IDEA better but still enjoy ACL.
I hope this helps.
Douglas E. Ziegenfuss
Professor and Chair,
Department of Accounting
Room 2157 Constant Hall
Old Dominion University
Norfolk, Virginia 23529-0229
ACL Business Assurance Analytics ---
http://www.acl.com/solutions/audit.aspx?bhcp=1
ACL is bundled with some auditing software textbooks, such as the
Rittenberg text ---
Click Here
IDEA Data Analysis Software ---
http://www.audimation.com/product_feat_benefits.htm
May 2, 2006 reply from Roger Debreceny
[roger@DEBRECENY.COM]
Over the years I have switched between ACL
and IDEA. I currently use IDEA in my teaching. A major factor is
that students greatly value having the ability to work on their own
computer. I do not think there are substantial differences between
the products or that the file size restrictions is a major problem.
Roger
Bob Jensen's threads on accounting and auditing software are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
Top Ten Emerging Technologies According to CFO Magazine in October 2002
THE NEED-TO-KNOW LIST
1. XBRL
2.
Business Intelligence
3.
Wireless Connectivity
4.
Grid Computing
5.
Multivariable Testing (MVT)
6.
Digital Cryptography
7.
Rich Media
8.
Internet2
9.
Biometrics
10.
Small Technology
XBRL tops the list. Bob Jensen's threads on XBRL are at http://faculty.trinity.edu/rjensen/XBRLandOLAP.htm#XBRLextended
Recommended Reading in Accounting, Finance, and Business
"Recommended Reading," by Beckey Bright, The Wall Street Journal,
March 26, 2006 9:21 p.m.; Page R2 ---
http://online.wsj.com/article/SB114305346764805424.html?mod=todays_us_the_journal_report
Bookkeeping and Accounting
• "Streetwise
Finance and Accounting ... How to keep your books and
manage your finances without an MBA a CPA or a PhD,"
By Suzanne Caplan
"While sales and marketing are the driving forces to get
the cash register ringing, it's the dull task of
crunching numbers that determines what the business
owner gets to keep! The problem is that most small
business owners hate dealing with numbers. This book is
an easy to understand primer for the business owner who
wants … and needs … a basic understanding of accounting
and finance."
• "Small
Business Accounting Simplified," By Daniel Sitarz
"Every year tens of thousands of small businesses fail
because the owners have been unable to manage their
financial affairs properly. Simplified for use by
nonaccountants, this book explains the fundamentals of
small-business bookkeeping in plain language and
provides a comprehensive set of clear and understandable
forms for tracking a small business's finances."
Finances and Investing
• "Savvy
Investing for Women," By Marlene Jupiter
"This book takes a basic approach to help readers
understand the world of money and investments, how to
evaluate your risk tolerance, and how to create and
manage a wealth-building strategy that works. Whether
you are just starting out in the work force, recently
inherited a family fortune, or have arrived at the peak
of your career, it presents a very good base of
information on strategic investing and protecting your
assets as your life changes."
• "Wake
Up and Smell the Money," By Ginger Applegarth
"For those of you who have come to realize that if your
stock broker was so smart he (or she) would be retired
by now, it's time to take a hard look at your financial
habits and get some good old fashion money smarts. This
book offers readers an excellent guide to build wealth
on real street savvy time tested methods. While this
book doesn't promise you a windfall or that you will
become a multi-millionaire … it does offer valuable
advice and guidance and just might be the best
investment you'll make this year."
• "Values
Based Financial Planning," By Bill Bachrach
"While there is a never ending stream of books on
investing, most of the books were written by people who
presume the reader already has bushel baskets of money
lying around to invest. So what about the people who are
not at the point where they have substantial money to
plant and grow? This book takes a solid business
approach to financial planning and a program similar to
a business plan. In other words, one philosophy doesn't
fit every person. Before you can achieve better
financial success you have to determine what your
priorities are and what will motivate you."
Taxes
• "Schedule
C from A to Z - The Sole Proprietor's Guide to Tax
Savings," By Robert Hughes, CPA
"With more and more sole proprietors taking on the task
of doing their own bookkeeping and tax returns, not
having a solid understanding of what makes up the
Schedule C return means that many, if not most, sole
proprietors overpay taxes by hundreds or thousands of
dollars. This guide de-mystifies taxes that apply to the
self-employed with the aim of helping business owners
increase cash available to help their businesses prosper
and grow. It takes the reader step-by-step through each
line of the Schedule C and includes information to help
them understand and comply with IRS rules. The updated
full version for the 2005 tax year is available at
www.NASE.org/scheduleC."
• "Tax
Savvy for Small Business," By Frederick W. Daily
"Most people don't go into business to be tax experts,
but not having a basic understanding of business taxes
is an expensive error to make. One of the most common
mistakes small business owners make is thinking that
they can just turn all their financial matters over to a
bookkeeper or accountant. However, the first rule of
business finances is that nobody, absolutely nobody, is
going to have as much concern for your money as you
will! This book is one of the best plain language books
on small business taxes. Unless you have an army of
accountants working for your business this book is a
must read.
Raising Money
• "Where's
the Money?" By Art Beroff and Dwayne Moyers
"Raising capital can be frustrating for any business.
While there is no book that can guarantee you will find
the money you need to start or grow a business, this
guide slashes through much of the red tape and confusing
jargon to put financing solutions at your fingertips.
Unlike many other books on small-business financing,
this book offers up expert tips, advice and secrets for
writing financial statements that appeal to different
audiences, filling out loan applications that get
results, anticipating investor questions, and how to
present your business, and yourself in a professional
manner.
• "Investors
in Your Backyard: How to Raise Business Capital from the
People You Know," By Asheesh Advani
This is an excellent resource to find the information,
documents and calculators you need to put a deal
together and negotiate all the particulars to convince
people to invest in your business. You'll find
step-by-step instructions on how to raise business
capital from non-traditional sources such as bank –
capital in forms such as gifts, loans or equity
investments – from people you already know or who know
people you know. Once you have the investment team
together Investors in Your Backyard will help you create
the paperwork to formalize the deal and protect both
sides' interests.
Marketing
• "Money-Tree
Marketing," By Patrick Bishop and Jennifer A.
Bishop
Written for business owners who want to achieve higher
than normal yields from their marketing efforts, this
book helps entrepreneurs generate customers, regardless
of the business owner's budget or marketing experience,
by keeping to the basics and capitalizing on what the
competition "might not be doing". This book helps a
small business owner increase their profits by using
some unique techniques that entice potential customers
into their business. More importantly, it identifies
ways to make a business more customer friendly, use a
customer profile to get in-depth knowledge about
customers and to keep those customers coming back for
more.
Legal
• "The
Legal Guide for Starting & Running a Small Business,"
By Fred S. Steingold
Legal questions come up everyday that make business
owners scratch their head and wonder what to do. Will
incorporating your business give you more liability
protection? Do you have all the proper permits and
licenses? These are just a couple of the hundreds of
questions that are routine in everyday business. Having
a resource to get a basic understanding of small
business legal issues is not any further away than
reaching for this excellent resource of street savvy
small business legal information.
• "Small
Business Legal Smarts," By Deborah L. Jacobs
"This simple to understand book will offer readers
enough information about legal issues in business to
raise those little red flags in your head when something
needs closer attention. Actually, it is more like a big
Q&A book and a reference tool with a twist. It's
organized completely around the needs of micro and small
businesses. This book filters out the legalese and
untangles some of the most frequent questions an
entrepreneur might encounter."
• "The
Employer's Legal Handbook," By Fred S. Steingold
For any employer, with 1 or 50 employees, having access
to a well laid out reference book of "answers" is
important to staying out of trouble and getting the most
out of their employees. In this case this book offers a
sensible, real life, approach to dealing with employees
and all in easy to understand language from the initial
hiring process - and asking or saying the right things -
to firing an employee without getting your pants sued
off.
|
Financial Statement Analysis Software
September 3, 2005 message from Angela Lee
Dear Robert Jensen,
In case you missed our demonstration at the
American Accounting Association conference in San Francisco, we hope
you will find the information below helpful.
FinancialZ, Inc. is a financial software
company based in Tempe, AZ. We have an Educational version of our
software, Financial Grammar, which is currently being used at
universities across the country.
The software is best utilized in managerial
finance courses to teach analysis of financial data. It is designed
as a teaching enhancement tool to accelerate students' learning of
financial analysis concepts (i.e. how to spot red flags). It can be
used in either MBA or undergraduate classes. In addition, some of
our client-universities currently use it in entrepreneurial courses,
financial statement analysis and business development courses. The
software is CPA- engineered, (US) GAAP compliant and can be used for
AICPA review courses.
In order to download a trial version, go
to:
www.financialzinc.com . If you look under
the PRODUCTS tab, a PDF formatted brochure can be downloaded.
The software can be delivered via CD-Rom or
downloaded to the student's computer. The cost is $34.95/per
student/per course. If you are interested in incorporating this tool
in just one class it can be purchased, by the student, directly from
our website using a designated school code.
I invite you to download and experience our
software. I will follow up with you again next week to answer any
questions that you may have. In the meantime, please don't hesitate
to contact me at the number below.
Best regards,
Angela Lee Director,
Marketing FinancialZ, Inc. 480.941.4567
www.financialzinc.com
For 20 years Cougar Mountain Software has been a leading developer of
not-for-profit accounting software. Many of the nation's largest
non-profit organizations and government agencies depend on Cougar
Mountain to provide a fully-integrated software solution, powerful
enough to meet their growing needs.
Click below to learn more about the Cougar Mountain FUND Accounting®
for Windows® software package. http://www.as411.com/DomBanAd.nsf/WebAdClick?OpenAgent&A=COUGAR-LNK1
"Consolidation In The Accounting Software Industy: Two
Perspectives," by Scott H. Cytron, AccountingSoftware.com --- http://www.as411.com/AcctSoftware.nsf/00/TIS22003246
February 16, 2003 message from Gerald Trites [gtrites@STFX.CA]
The Canadian Institute of Chartered
Accountants has a publication "Information Technology Control
Guidelines" which was published in 1999. The book is quite large
and there has been some talk about a possible decision support system
that might be developed, loaded with the ITCG guidelines, placed on a
CD and used in the field for assistance in analyzing system controls
for particular systems/companies and developing recommendation
letters. I would think the preferred approach would be to find a
suitable shell and then build the system around it. In the course of
my research of a good system, I came across VP-Expert which at one
time was highly recommended, but it is DOS based and appears to be out
of date. There is a variety of others. Does anyone have knowledge of a
good DS shell that might be useful for this application and that would
run on current Windows platforms? It should have run-time capability
so the CD can run on its own.
Any advice you might have would be most
appreciated.
Gerald Trites, FCA
Professor of Accounting and Information Systems
St Francis Xavier University Antigonish,
Nova Scotia Tel.
Website - http://www.stfx.ca/people/gtrites
The CICA home page is at http://www.cica.ca/
October 12, 2002
message from Scott Bonacker, CPA [scottbonacker@moccpa.com]
I don't know
anyone that is using this yet, but this product may be of interest. It
doesn't seem to be all that expensive."...a fund accounting
software solution that's designed to meet the specialized needs of
nonprofit organizations. Designed as a companion application to
Intuit's popular accounting programs
QuickBooks
Pro 2002..."
http://www.nonprofitbooks.com/qbpro_info.asp
http://www.nonprofitfinancial.org/sw/
http://quickbooksusers.com/nonprofit.htm
http://www4.compasspoint.org/p.asp?WebPage_ID=385
http://www.smallbusinesscomputing.com/biztools/article.php/1025041
November 29, 2002 message from CompAcct Solutions Ltd. [csl@COMPACCTSOLUTIONS.COM]
Our company has recently developed an entry
level computer accounting program called Breeze Basic Bookkeeper. We
have received a positive responce from educators who have tried the
program. The program is designed around GAAP using an approach that
you might find in a 1st year accounting textbook. The program was
designed by an accountant to do basic bookeeping without the glitz and
glitter that a lot of programs use to purposely hide basic accounting
principles. You will see no flashy invoice or check screens in this
program. Journal entries are made in standard Debit/Credit format in
an easy to use Journal Form. The program has a Debit/Credit Helper to
assist the beginner get orientated into the proper use of debits and
credits.
You can download a Free Demo at http://www.compacctsolutions.com
The price of a single user license is
US$69.95. However, Lab Discounts, which combine a volume and
educational discount, are available by request for qualifying
Educational Institutions. The lab discounts range from 45% to 65%
depending on the number of users starting at a 5 user license. Send an
email to csl@compacctsolutions.com for complete information on the
discounts available and how to take advantage of the discounts.
Bryan
Software at huge educator discounts www.edu-software.com
or call us 800-679-7007
Business office software tools (including accounting and tax
software)
Phil and Mac's Secret Free Place --- http://www.maxpatch.com/misc4.html
Readers should definitely take a look at this annotated software index,
although some items appear to be out of date.
A review of accounting software (commercial not academic apps) http://www.cfo.com/buyers_guide/index_article.html
High-End
Accounting Software Vendors
http://www.cfo.com/buyers_guide/high_end_chart_1.html
Search the high-end packages that generally target companies with
revenues over $100 million. Vendors are listed by the integrated
functions, integrated manufacturing, Internet functions, platform, and
pricing.
Midrange
Accounting Software Vendors
http://www.cfo.com/buyers_guide/mid_range_chart_1.html
Search the midrange packages that generally target companies with
revenues under $100 million, and find which vendors offer the right
mix of functions and compatibility.
Bob Jensen's Threads on Webledgers
(e.g., NetLedger) for Distributed Network Computing of Accounting Systems and Business
Services http://faculty.trinity.edu/rjensen/webledger.htm
The Securities and Exchange Commission (SEC) and the
North American Securities Administrators Association (NASAA) have announced the
launch of a new Web site designed to provide information about money managers,
financial planners, and other investment advisors.
http://www.accountingweb.com/item/59363
Accounting Software 411 (AS411) --- http://www.accountingsoftware411.com/
Accounting
Software 411 (AS411)
is the place on the Web where you can find the latest news and
information on accounting software products. This site is targeted to
software consultants, software vendors and anyone who is either
researching or is interested in information about accounting software
and related solutions. Our goal is to create a community whereby
everyone can learn and share their knowledge about the accounting
software industry.
There
is a great review of tax software in the following cover story:
"Ranking
the Products," by Stanley Zarowin, Journal of Accountancy,
October 2001, pp. 28-32 --- http://www.aicpa.org/pubs/jofa/oct2001/zarowin.htm
Vendor |
Tax
program |
Address |
Telephone |
E-mail
address |
ATX
Forms |
Saber,
Max
and Taxsolver |
PO
Box 1040,
Caribou, ME 04736 |
800-944-8883 |
sales@atxforms.com |
CCH |
ProSystem
fx |
21250
Hawthorne Blvd.,
Torrance, CA 90503 |
800-457-7639 |
cust_serv@cch.com |
Creative
Solutions |
UltraTax |
7322
Newman Blvd.,
Dexter, MI 48130 |
800-968-8900 |
sales@CreativeSolutions.com |
Drake
Software |
Drake
Tax
Solution |
235
E. Palmer St.,
Franklin, NC 28734 |
800-890-9500 |
drakeinfo@drake-software.com |
Dunphy
Systems |
1040
Professional
Tax Preparation |
6740
Huntley Rd., Suite 103,
Columbus, OH 43229 |
614-431-0846 |
dunphy@dunphy.com |
Intuit |
ProSeries |
2535
Garcia Ave.,
Mountain View, CA 94043 |
800-934-1040 |
www.proseries.com |
Lacerte/Intuit |
Lacerte
1040
Tax Software |
13155
Noel Rd., 22nd Floor,
Dallas, TX 75244 |
800-765-7777 |
www.lscsoft.com |
Micro
Vision
Software |
Tax
Relief 1040 |
140
Fell Court,
Hauppauge, NY 11788 |
800-829-7354 |
www.microvisioninc.com |
Orrtax
Software |
IntelliTax |
13208
NE 20th St.,
Bellevue, WA 98005 |
800-377-3337 |
webmaster@orrtax.com |
TaxACT |
2nd
Story Software |
5925
Dry Creek Lane, NE,
Cedar Rapids, IA 52402 |
800-573-4287 |
www.taxact.com |
Taxworks
By
Laser Systems |
TaxWorks
By
Laser Systems |
350
North 400 West,
Kaysville, UT 84037 |
800-230-2322 |
www.taxworks.com |
Universal
Tax Systems |
TaxWise |
6
Mathis Dr. NW, PO Box 2729,
Rome, GA 30164 |
800-755-9473 |
sales@universalsystems.com |
Xpress
Software |
Xpress
Individual
Package |
P.O.
Box 280760,
Columbia, SC 29228 |
800-285-1065 |
www.xpresssoftware.com |
Accounting Software Library http://www.excelco.com/tal.htm
Ed Scribner provided the following links:
http://www.4accountingsoftware.com/
http://www.2020software.com/acct.htm
The following has lots of great links. You might have to right
click on it and paste it into your browser.
http://www.ecompany.com/webguide/0,1660,14554%7C121%7C0%7C0%7C1%7Ca,00.html
The 2/20/01 PC Magazine has an article (pp. 144-152) that
includes reviews of ePeachtree 3.0, NetLedger 5.0, Peachtree Complete
8, QuickBooks Pro 2001, and QuickBooks for the Web. The reviews
are linked at:
http://www.zdnet.com/eweek/stories/general/0,11011,2678673,00.html
Peachtree Accounting Practice Sets ---
http://www.perdisco.com/peachtree/
Another great website is Payroll Online at http://www.payrollonline.com/
A great set of links to electronic journals and databases (unfortunately
the software database links now have restricted access)
http://www.lib.polyu.edu.hk/electdb/index.htm
- Accounting
Journals Index
http://www.businessfinancemag.com/archives/appfiles/Topics.cfm?Action=Lookup
ABC Costing Glossary and Software http://www.rpm-abm.com/cami_idx.htm
Jensen & Sandlin Survey of U.S. Accountancy Education
Programs
- Bob Jensen's Links to Accounting Software and Vendors
AccountingStudents is the complete online resource for
accounting students
Bob Anthonys Essentials of Accounting multimedia CD
ROM http://www.cstone.net/~ivysoft/
Dan Gode (Accounting Tutorials)
- So, you want to learn Bookkeeping! by Bean Counter's Dave Marshall ---
http://www.dwmbeancounter.com/tutorial/Tutorial.html
RJ Interactive Home Page (Online Accounting, Publishing)
(Richard J. Campbell)
- Omnis Mus (George
Bodnar)
- Bruce Hutton CGA -
Accounting: Software, Publications and Bookkeeping Software
- Software Vendors
Omnis Mus (a general ledger practice
set)
- Accpac User Area
- Accounting Systems -- Accounting System
Locator / Selector
- High Q Learning Products - Courseware -
Software - Accounting Courseware, Accounting Education, Accounting Training
Great Plains Software - Higher education
site
- Microsoft's Accounting Industry Page
- Peachtree Software
Peachtree Accounting Practice Sets ---
http://www.perdisco.com/peachtree/
- SBT
- Solomon Software
- The CMA Review
Online!
- AccountingStudents.com
- RJ Interactive Home Page (Online
Accounting, Publishing) (Richard J. Campbell)
- Darrell Walden at U.
of Richmond - Accounting Information Systems
- TAL Standard Edition "Quick
LOOK" AIA Accounting Information Systems
- Spreadsheets in
Education
Welcome to CAROL (online annual financial reports)
- The International Corporate Environmental
Reporting Site / Milieujaarverslagen
Charles A. Dice Center for Research in Financial Economics http://www.cob.ohio-state.edu/~fin/dice/index.htm
"Sizing
Up NPO Software," Roberta Ann Jones, Journal of Accountancy,
November 2000, pp. 28-44 --- http://www.aicpa.org/pubs/jofa/nov2000/jones.htm
Online Magazine (for Information Professionals) --- http://www.onlineinc.com/onlinemag/index.html
ONLINE is written for Information
Professionals and provides articles, product reviews, case studies,
evaluation, and informed opinion about selecting, using, and managing
electronic information products, plus industry and professional
information about online database systems, CD-ROM, and the Internet.
This site contains selected full-text articles and news from each
issue of the magazine. Direct letters to the editor to Marydee Ojala (
Marydee@xmission.com ). If you are interested in writing for
ONLINE, please see the Authors' Guidelines.
e-Commerce and e-Business Helpers for
Accountants --- http://faculty.trinity.edu/rjensen/ecommerce.htm
A message from Julie Smith David [Julie.Smith.David@ASU.EDU]
Arizona State University
I teach a course in
software selection and evaluation, and the following is a list of sites
that I have collected, with the help of several years of students.
The students have to research software products, and they use these
sites to find articles, reviews and comparisons. Therefore,
they're not all appropriate for "comparisons," but they all
seem to add value at some point in the class. Perhaps the best for
ERP and CRM is TechnologyEvaluation.com (has a selection tool that is
REALLY good!). Intelligent Enterprise is great for CRM, KM, and
integration. Hope these help!
MAGAZINES:
Business 2.0 <http://www.business2.com/>
(http://www.business2.com/)
Business Finance Magazine <http://www.businessfinancemag.com/>
(http://www.businessfinancemag.com/)
Often has feature articles that
highlight technology issues that CFO's and CIO's need to handle.
Business Week Online <http://www.businessweek.com>
(http://www.businessweek.com)
Byte Online <http://www.byte.online>
(http://www.byte.online)
CFO <http://www.cfonet.com/html/cfocont.html>
(http://www.cfonet.com/html/cfocont.html)
CIO <http://www.cio.com/>
(http://www.cio.com/)
CNN Interactive <http://www.cnn.com/>
(http://www.cnn.com/)
Context <http://www.contextmag.com/>
(http://www.contextmag.com/)
Business Strategies for the Digital
Age
Datamation <http://datamation.earthweb.com/>
(http://datamation.earthweb.com/)
DB2 Magazine <http://www.db2mag.com/>
(http://www.db2mag.com/)
e.biz by BusinessWeek <http://www.businessweek.com/ebiz/>
(http://www.businessweek.com/ebiz/)
E&Y's Perspectives on Business
Innovation <http://www.businessinnovation.ey.com/journal/loader.html>
(http://www.businessinnovation.ey.com/journal/loader.html)
EAI Journal <http://www.eaijournal.com/>
(http://www.eaijournal.com/)
ERP News Center by Allen David
& Associates <http://www.softwarejobs.com/cgi-bin/swjobs/news.cgi?hits=10&action=show&category=/NEWS/ERP/&ion=TRADE&gcode=erp&skill=ERP&topic=Trade+Articles>
(http://www.softwarejobs.com/cgi-bin/swjobs/news.cgi?hits=10&action=show&category=/NEWS/ERP/&ion=TRADE&gcode=erp&skill=ERP&topic=Trade+Articles)
Fast Company <http://www.fastcompany.com/homepage/>
(http://www.fastcompany.com/homepage/)
Financial Times <http://www.ft.com>
(http://www.ft.com)
FindArticles.com <http://www.findarticles.com>
(http://www.findarticles.com)
Forbes <http://www.forbes.com/>
(http://www.forbes.com/)
Forbes - directly to archives <http://www.forbes.com/forbes/archives/>
(http://www.forbes.com/forbes/archives/)
Fortune <http://www.fortune.com/fortune/>
(http://www.fortune.com/fortune/)
Harvard Business School Publishing
<http://www.hbsp.harvard.edu/home.html>
(http://www.hbsp.harvard.edu/home.html)
No articles available on-line.
IBM Systems Journals <http://www.research.ibm.com/journal/>
(http://www.research.ibm.com/journal/)
Inc. <http://www.inc.com/>
(http://www.inc.com/)
Information Week <http://www.informationweek.com/>
(http://www.informationweek.com/)
Infoworld <http://www.infoworld.com/>
(http://www.infoworld.com/)
Intelligent Enterprise <http://www.intelligententerprise.com/>
(http://www.intelligententerprise.com/)
Manufacturing Systems <http://www.manufacturingsystems.com/>
(http://www.manufacturingsystems.com/)
Midrange Enterprise (soon to be
APS) <http://www.apsmagazine.com/>
(http://www.apsmagazine.com/)
Midrange ERP <http://www.mfg-erp.com/>
(http://www.mfg-erp.com/)
Mobile Computing <http://mobilecomputing.com/>
(http://mobilecomputing.com/)
News 400 <http://www.as400network.com/>
(http://www.as400network.com/)
Purchasing Magazine <http://www.manufacturing.net/magazine/purchasing/>
(http://www.manufacturing.net/magazine/purchasing/)
Red Herring <http://www.redherring.com/mag/home.html>
(http://www.redherring.com/mag/home.html)
Software Magazine <http://www.softwaremag.com/>
(http://www.softwaremag.com/)
Strategy & Business <http://www.strategy-business.com/index.html>
(http://www.strategy-business.com/index.html)
US News & World Reports <http://www.usnews.com/usnews/home.htm>
(http://www.usnews.com/usnews/home.htm)
Wired <http://www.wired.com/>
(http://www.wired.com/)
ZDNet <http://www.zdnet.com/>
(http://www.zdnet.com/)
ORGANIZATIONS:
American Productivity &
Quality Center (APQC) <http://www.apqc.org/>
(http://www.apqc.org/)
APICS-The Educational Society for
Resource Management <http://www.apics.org/>
(http://www.apics.org/)
Arthur Andersen Global Best
Practices <http://www.arthurandersen.com/>
(http://www.arthurandersen.com/)
ASP Island <http://www.aspisland.com/>
(http://www.aspisland.com/)
An organization serving the
application service provider industry
Association of Computing
Machinery <http://www.acm.org/>
(http://www.acm.org/)
Benchmarking Partners <http://www.benchmarking.com/>
(http://www.benchmarking.com/)
Cambridge Technology Partners <http://www.ctp.com/>
(http://www.ctp.com/)
Center for Virtual Organization
and Commerce <http://isds.bus.lsu.edu/cvoc/learn/bpr/mprojects/bp/bpbasics.html>
(http://isds.bus.lsu.edu/cvoc/learn/bpr/mprojects/bp/bpbasics.html)
CorpTech -- Database of high
tech companies <http://www.corptech.com/>
(http://www.corptech.com/)
CORBA <http://www.corba.org/>
(http://www.corba.org/)
Enterprise Integration Council
<http://www.eicouncil.com/>
(http://www.eicouncil.com/)
Organization for Application
Integrators
Ernst & Young: <http://www.ey.com>
(http://www.ey.com)
Lots of information about IT,
industries, and strategy
ERP Super Site <http://www.erpsupersite.com/>
(http://www.erpsupersite.com/)
Forrester Group <http://www.forrester.com/Home/0,3257,1,FF.html>
(http://www.forrester.com/Home/0,3257,1,FF.html)
Gartner Group IT Vendor Direct
<http://gartner4.gartnerwebcom/vendors/static/index.poll.html>
(http://gartner4.gartnerwebcom/vendors/static/index.poll.html)
GIGA Information Group <http://www.gigaweb.com/>
(http://www.gigaweb.com/)
The Hackett Group <http://www.thgi.com>
(http://www.thgi.com)
International Data Corp. <http://www.idc.com/>
(http://www.idc.com/)
Intraware's Everything XML <http://www.intraware.com/control/shop/TechTopics?page=index.jsp§ion=xml>
(http://www.intraware.com/control/shop/TechTopics?page=index.jsp§ion=xml)
Intraware <http://www.intraware.com/index.html>
(http://www.intraware.com/index.html)
MessageQ.com <http://www.messageq.com/>
(http://www.messageq.com/)
Meta Group <http://www.metagroup.com/>
(http://www.metagroup.com/)
Netscape's Small Business Source
<http://netbusiness.netscape.com/login.psp>
(http://netbusiness.netscape.com/login.psp)
Object Management Group (OMG)
<http://www.omg.org>
(http://www.omg.org)
Solution Matrix: The business case
web site <http://www.solutionmatrix.com/>
(http://www.solutionmatrix.com/)
Resources for performing ROI,
Cost-Benefit Analysis, and other justification processes.
SPEX for software evaluations
<http://www.checkspex.com/index.htm>
(http://www.checkspex.com/index.htm)
Supply Chain Council <http://www.supply-chain.org/>
(http://www.supply-chain.org/)
TechnologyEvaluation.com <http://www.technologyevaluation.com/>
(http://www.technologyevaluation.com/)
Workflowsoftware.com <http://www.workflowsoftware.com>
(http://www.workflowsoftware.com
-
"How to Select the Right Accounting Software," by by J.
Carlton Colling, Journal of Accountancy, October 1999 --- http://www.occpa.com/joasw3.htm
"Sizing Up NPO Software, Roberta Ann Jones, Journal of
Accountancy, November 2000 --- http://www.aicpa.org/pubs/jofa/nov2000/jones.htm
NPO = Not-for-Profict Organization (including governmental agencies).
Accounting Software Directory http://www.bizforms.com/hlpchrt1.htm
Each listing
includes the manufacturer's name, software titles, platforms
supported, price range, web site links and telephone numbers. A brief
description of the company's software products is also included.
Please note that Software Manufacturers almost always offer technical
support for their own products on their respective web sites. Their
sites frequently provide excellent business help or have excellent
links to other sources for business help. We will mention when a
software site includes help or access to resources that are of general
interest to businesses of all kinds.
Accounting Software Review --- http://www.cpasoftwarenews.com/editorial/articles/1999/9-7.htm
Accounting
Software News --- http://www.accountingsoftwarenews.com/
"Software
for Beyond the SOHO and Single-Office Environment"
By David B. Moody, CPA
[ACCPAC] [AccTrak21] [Champion Business Systems] [Cougar
Mountain Software] [CYMA] [Database Creations] [DataModes] [eTEK
International] [International Accounting Software] [Peachtree Software]
[Red Wing Business Systems] [Sage] [SBT] [Sirius Software]
"High-End
Accounting: Big Business Features with a Small Business Feel"
By David B. Moody, CPA
[ACCPAC International] [Appgen] [eTEK International] [Macola]
[Open Systems] [Sage] [SBT] [Solomon Software] [SouthWare Innovations]
[The Versatile Group] [Due-Diligence Table]
Accountancy Career Threads ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#Careers
CPA exam requirements by state ---
https://financialanalystinsider.com/cpa-state-requirements/
Bryce Welker: Tips on Passing the CPA Exam ---
https://crushthecpaexam.com/
The Uniform CPA Examination Website
--- http://www.cpa-exam.org/
From the CFO Journal's Morning Ledger on April 12, 2017
Accountants may need to go beyond their
expertise with numbers. The uniform
certified public accountant exam
began testing candidates on critical thinking,
problem solving and analysis at the beginning of the month. The
American Institute of CPAs, National Association of State Boards of
Accountancy and Prometric announced the change
Wednesday. One of the biggest changes
is to the "exam blueprints" which have replaced the Content
Specification Outline (CSO) and Skill Specification Outline (SSO) as
the primary testing element. They identify knowledge linked directly
to representative tasks performed by newly licensed CPAs, according
to the AICPA. The new assessment will help accountants who are using
these skills early in their career “stay ahead of the curve,” said
Michael Decker, the vice president of examinations at AICPA, in a
written statement
Possibly the Number 1 Resource for CPA Exam Candidates
AICPA: Uniform CPA Exam Blueprints ---
https://www.aicpa.org/content/dam/aicpa/becomeacpa/cpaexam/examinationcontent/downloadabledocuments/cpa-exam-blueprints-effective-jan-2019.pdf
CPA exam will increase focus on higher-order skills
"What Higher Order Skills Will be Tested on the Next CPA Examination," by Ken
Tysiac, Journal of Accountancy, April 4, 2016 ---
http://www.journalofaccountancy.com/news/2016/apr/new-cpa-exam-201614166.html?utm_source=mnl:cpald&utm_medium=email&utm_campaign=04Apr2016
. . .
Why the exam is changing
The CPA exam is designed to provide state boards of accountancy reasonable
assurance that those who receive passing grades have sufficient technical
knowledge and skills to be licensed. The AICPA periodically conducts a
practice analysis to ensure that the exam measures the right knowledge and
skills to protect the public interest and meet the needs of the boards of
accountancy as they license CPAs.
A practice analysis
launched in early 2014 collected input from boards of accountancy, state
societies, public accounting firms, academics, standard setters, regulators,
and business and industry on the knowledge and skills needed by newly
licensed CPAs. The research revealed that because of advances in technology
and outsourcing of routine tasks, newly licensed CPAs increasingly need to
use higher-order cognitive skills and professional skepticism while
performing tasks such as planning and reviewing the work of others.
As a result, the research showed, the profession supports changing the exam
to enable more testing of higher-order skills that would align more closely
with the tasks newly licensed CPAs regularly perform.
“With this practice analysis, we heard from the profession that newly
licensed CPAs not only need to have the knowledge, but they need to have
higher-order skills,” Decker said. “They need to analyze financial and tax
information. And they must be able to think critically and problem-solve in
their day-to-day jobs.”
What’s new
The next CPA exam will continue to test in the familiar four
sections—Auditing and Attestation (AUD), Business Environment and Concepts (BEC),
Financial Accounting and Reporting (FAR), and Regulation (REG). The exam
will place less emphasis on remembering-and-understanding skills, enabling
higher-level analysis and evaluation skills to be tested:
-
The number of task-based simulations, a highly effective way to assess
higher-order skills, will increase. Task-based simulations will be added
to the BEC section for the first time, and the AUD, FAR, and REG
sections each will have their number of task-based simulations increased
to eight or nine.
-
Total testing time will increase from 14 to 16 hours. This will
accommodate increases of one hour each for the BEC and REG sections. The
extra time is being allotted partly because of the increase in
task-based simulations. A review found that there is sufficient time for
prepared candidates to complete the AUD and FAR sections.
-
Multiple-choice questions and task-based simulations each will
contribute about 50% toward the candidate’s score in the AUD, FAR, and
REG sections. In the BEC section, multiple-choice questions will
contribute about 50% of the scoring, with 35% coming from task-based
simulations and 15% from written communication.
In the past, multiple-choice questions were weighted about 60% in the total
scoring of the exam. That will decrease to about 50% in the next exam.
“The profession is demanding stronger critical-thinking skills from newly
licensed CPAs,” Decker said. “They need to be able to form conclusions in
basic areas and identify issues in more complex and riskier areas. And,
based on the feedback from our stakeholders, we have designed each of the
exam sections based on a task and skill framework to meet those
requirements.”
New blueprints for preparation
To prepare for the next exam, candidates will be able to use new blueprints
that will replace the current Content Specification Outline (CSO) and Skill
Specification Outline (SSO). The blueprints will provide candidates more
detail about what to expect on the exam. The blueprints contain about 600
representative tasks, which are aligned with the skills required of newly
licensed CPAs, across the four exam sections. The blueprints are designed to
provide candidates with clearer information on the material the exam will
test, and will show educators what knowledge and skills candidates need as
newly licensed CPAs.
Continued in article
A Practice Analysis ---
http://www.aicpa.org/BecomeACPA/CPAExam/nextexam/DownloadableDocuments/2016-practice-analysis-final-report.pdf
Free CPA Review Course ---
http://cpareviewforfree.com/
Not updated for recent changes in exam coverage
TUTORIAL AVAILABLE FOR NEW COMPUTERIZED CPA EXAM http://www.cpa-exam.org/
CPA Exam Slated for International Debut in August ---
http://www.journalofaccountancy.com/Web/20113892.htm
CPA Experience Requirements Vary by
State ---
http://www.becker.com/accounting/cpaexamreview/state/index.cfm
For more details, check with your state's board of accountancy:
WileyCPAExamExcel: CPA Exam Students’ Study Tips ---
http://blog.efficientlearning.com/cpa/cpa-exam-stories/cpa-exam-study-tips
How a 17-Year-Old Female Passed the CPA Exam ---
http://blog.efficientlearning.com/cpa/cpa-exam-stories/17-year-old-passed-cpa-exam
Crush the CPA Exam ---
https://crushthecpaexam.com/
Why Take the CPA Exam ---
https://www.cpaexamguide.com/learn/cpa-exam-worth/
The Jr. Deputy Accountant finally got around to Texas:
"Don't Worry, We Didn't Forget Those Texas College CPA Exam Results,"
Adrienne Gonzalez, Going Concern, February 15, 2012 ---
http://goingconcern.com/post/dont-worry-we-didnt-forget-those-texas-college-cpa-exam-results
Jensen Comment
Even though I'm proud of the performance of Trinity University in 2011,
once again I remind readers that there is much more variability among
small universities like Trinity University that have so few CPA exam
takers each year. The University of Texas at Austin is consistently at
or near the top in Texas with low variability because it has a
relatively large number of CPA exam candidates each year, and UT has
relatively very high admission standards for the masters of accounting
program. Trinity, on the other hand, is more likely to have good years
and bad years due to small sample effects and loss of some of the best
graduates (see below).
Because of Trinity has much higher tuition for an accounting masters
degree than the state universities, there is some attrition of Trinity's
four-year accounting graduates to the state universities, especially to
the University of Texas at Austin. It was always sad to lose some of our
best graduates to UT, but we knew UT would take good care of them.
Texas CPA examination performances are heavily impacted by
SAT/ACT/GMAT exam scores of accountancy graduates. This is consistent
with virtually all the other 50 states in the United States. Schools
with the highest admission standards will have the higher performing
graduates on average.
I don't attribute high CPA exam scores to curricula focused more
heavily on teaching toward the CPA examination. When I left Trinity
University, Trinity was experimenting with a CPA exam review course
at the very strong request of accounting students in the masters program.
I did not teach that course, but when I retired in 2006 the professor
(Katherine Lopez) teaching the CPA review course was re-assigned to
teach my Accounting Theory course. The CPA review course was dropped
from the curriculum without having any adverse impacts on CPA exam
performance of Trinity's graduates. I might add that when I taught
Accounting Theory my students complained that the course really did
not help them on the CPA examination. The topics covered (like
accounting for derivative financial instruments, portfolio theory, risk
metrics, financial structures, and securitization) are considered too
complicated for the CPA examination ---
http://faculty.trinity.edu/rjensen/acct5341/acct5341.htm
We should not give too much credit to accounting faculty when their
top students do well on the CPA examination. Because those students also
are top performers in terms of SAT/ACT/GMAT exam scores, those
students have more intellectual ability and motivation to get the most
out of commercial CPA examination review courses like Becker, Bisk,
Gleim, etc.
"Comparing CPA Review Courses," by Junior Deputy Accountant
Adrienne Gonzalaz ---
http://goingconcern.com/2011/03/comparing-cpa-review-courses/#more-27710
We’ve gone
over
how to choose a CPA review course in
the past but it seems we’ve been getting more emails than usual
asking about specific review programs. Due to a potential
perceived bias (this author was employed in CPA Review for four
years), we have avoided covering this subject in detail until
now.
The following list of review courses is by no means
comprehensive and we do not endorse any of these courses
(unless, of course, they would like to get in touch with our
advertising
folks and set up a sweet deal to be pimped
out). CPA exam candidates are highly encouraged to do their own
research by
checking blogs and forums. Coworkers
can also be a good source of info but keep in mind colleagues
are less likely than strangers on the Internet to be honest
about their own performance so take any information you glean
from them with a grain of salt.
Many have asked
if additional supplemental products are necessary when dropping
a big chunk of cash on CPA review. I generally tell candidates
to save their pennies, get a $2 pack of index cards and make
their own flash cards. Not only do you save money, by writing
them out yourself you’ll actually see that you’re understanding
the concepts better simply due to the mechanical motion of
putting pen to paper.
We’ve
included links to CPAnet where appropriate so you can check out
actual candidate feedback (the positive and negative) which
former students of each of these courses have posted on the
forums there.
•
Becker: Retail Price:
$3,065 (all four parts)
Per part if ordered individually: $990 (CPAnet)
•
CPAexcel: Retail price
(Gold Medal option): $1690 (four parts) Per part if ordered
individually: $580 (CPAnet)
• Kaplan, Gleim and Bisk:
Considered self-study or supplemental,
check CPAnet for feedback on these courses.
•
Roger: Retail Price:
$2095 – $1695 (all four parts) Per part if ordered individually:
$595 – $695 (CPAnet)
•
Wiley: Price varies based on options. (CPAnet)
•
Yaeger: Retail
price: $1787 (four parts) Per part if ordered individually: $545
(CPAnet)
This is where
our lovely GC readers come in. We know you all are really proud
of how you’ve kicked the CPA exam’s ass, so please let us know
in the comments what worked for you. If you all can get extra
excited about this, we can put together a GC reader CPA review
deathmatch based on your input.
Note:
prices current as of 3/29/11 based on available information. If
you have a correction, please
get in touch.
Jensen Comment
This approach to comparing alternatives will make most accountics
professors shudder. Can't you just imagine the course managers'
contacting their "alumni" requesting that you send Going Concern
raving reviews about their CPA Review "alma maters?"
Actually most any way I can think of to compare these coaching course
alternatives makes me shudder. These coaching courses are often very
important to some exam takers, but in every instance a coaching course
is only one variable leading to success, and it's not an independent
variable. It's a variable that interacts with many other factors in
complicated and dynamic ways. I defy anybody in the real world to
isolate its first-order plus its higher order impacts and to robustly
extrapolate the findings to a person comparing these coaching course
alternatives.
Firstly, exam takers may not know what factors really led to success
when they took the CPA Examination and/or they may falsely attribute
success to factors that in the grand scheme of things were truly less
important. For example, coaching courses have a "recent-timing bias" in
that they are the last big efforts to study for the exam when in reality
the success may be largely attributable to some parts of undergraduate
courses they took years ago.
Secondly, exam takers may attribute too much to things that don't
necessarily differ greatly between coaching courses. Some exam takers
attribute success to coaching courses that kick butt and force them to
study a lot weekly. But since nearly all the coaching courses kick butt
in one way or another, this hardly distinguishes the best butt kickers.
Other exam takers attribute success to the coaching course "wizards" who
successfully predicted what would be on a particular exam. But coaching
courses may have varying success in this regard over time and with
varying degrees of luck.
Thirdly, when education researchers compare different pedagogies among
good students, the general finding is that there's no significant
difference between one pedagogy versus another. Good students adjust to
different instructors, different textbooks, different teaching methods,
different coaching, etc. ---
http://faculty.trinity.edu/rjensen/assess.htm#AssessmentIssues
I think there are many ways coaching courses can be compared on the
input side. I don't see a good way of comparing them on the output side.
Also it's not at all clear to me that many students get what they pay
for, although the fault for this may vary. Some coaching courses are
overpriced in my viewpoint. Going for the most expensive course does not
mean you get what you paid extra for to pass the exam.
Some things are probably more important than coaching courses. For
example, how much time off does your employer give you to study for the
exam and how efficiently do you make use of that free time? Do you have
to study in hotel rooms more than you can study conveniently at home? Do
you have to study for the exam while having to also bounce a child on
each knee most of the time? WC Fields said there's only one good way to
have kids --- cooked. How much do you really, really, really want to
pass this exam? Are you really studying so intently that you have to
change underwear six times a day? Are there too many outside
distractions in your life such as excessive success or failure in your
love life? Are you spending too much time pouring over Bob Jensen's AECM
messaging?
When the Great Scorer at NASBA comes to write against your name, he
writes if you won or lost, not how you played the game.
Educational Resources and Exams to
Become an Accountant or CPA ---
http://www.accountingedu.org/
Bob Jensen's threads on the CPA
Examination are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#010303CPAExam
Also see Test Prep Support ---
http://www.testprepsupport.com/test/cpa-exam/resources
"The
Quickest 2011 CPA Exam Breakdown You’ll Ever Read," by
Adrienne Gonzalez, Going Concern, September 24, 2011 ---
http://goingconcern.com/2010/09/the-quickest-2011-cpa-exam-breakdown-youll-ever-read/
Because we know all of you are very busy tearing up your
last exams before CBT-e hits in January of 2011, we won’t waste your
time and get right to the point. 2011 is coming, the exam is changing
and though we’ve been over it plenty in the last several months, let’s
go over it one more time.
Simulations
– This year’s simulations are next year’s simlets.
Simulation problems
will be shorter, task-based problems that
should take you about 10 – 15 minutes to complete as opposed to the 45
minutes they take now. AUD and FAR will have 7 smaller simulation
problems while REG will have 6. As usual, not all of these are graded.
Multiple choice
– BEC and REG will contain 24 MCQ per testlet while FAR and AUD will
still contain 30. MCQ will make up 60% of the FAR, AUD and REG exams and
85% of BEC.
Research
– if you’re taking the exam this year, research is buried in simulations
and doesn’t carry much weight point wise. Next year, however,
research will be its own tab
worth as many points as any of the other
simlet problems. FAR research will be easy as it is limited to the ASCs
(Accounting Standard Codification) and REG will mostly draw from the
Internal Revenue Code but AUD will come with a dropdown menu that
includes PCAOB ASs, the Code of Professional Conduct and SSARS just to
name a few. You’ve been warned.
Written communication
– WC is out of FAR, REG and AUD and slapped into BEC. You’ll have to
write three written communications, of which two will be graded.
International standards
–
IFRS and
international auditing standards will be added to current FAR and AUD
content (respectively) while REG is mostly unchanged by this as you
can’t really test international standards of federal taxation. Keep in
mind that this additional content will most likely be gently mixed in
with what is already being tested and does not make GAAP completely
irrelevant so don’t use 2011 as an excuse to procrastinate all the way
through the holidays.
Now stop wasting your time with inflammatory nonsense blogs and GET BACK
TO STUDYING!
(btw: if you have a CPA exam question for us – anything from applying to
qualifying to passing – do
get
in touch)
CPA Exam Guy ---
https://cpaexamguy.com/
Bob Jensen's threads on the CPA Examination are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010303CPAExam
PS
Joe Hoyle and his former partners elected to make their commercial CPA
Examination Review materials free online. I am contacting Joe to see if
they intend to keep those materials up to date for future CPA
examinations. A link to the Hoyle et al. free materials is provided at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010303CPAExam
September 25, 2010 reply from Joe Hoyle
-----Original Message-----
From: Hoyle, Joe [mailto:jhoyle@richmond.edu]
Sent: Saturday, September 25, 2010 8:42 AM
To: Jensen, Robert
Subject: RE: Question for Joe Hoyle: The Quickest 2011 CPA Exam
Breakdown You'll Ever Read
Hi Bob,
Hope this finds you well. I just got through giving a bunch of tests
last week (Intermediate Accounting II and Introduction to Financial
Accounting) and, as always, some learned it all and some learned a lot
less. I am using my own new Financial Accounting textbook this
semester. As you may know, the book is written in an entirely Socratic
Method (question and answer style). I find that approach stimulates
student curiosity much better than the traditional textbook which uses
what I call a sermon or monologue style. The Socratic Method has been
around for 2,500 years -- isn't it strange that it has been ignored as a
possible textbook model?
I'm not a big fan of college education presently (that is college
education and not just accounting education). There are three major
components to education: professors, students, and the textbook (or
other course material). It is hard to change the professors and the
students. I think if we want to create a true evolution in college
education in a hurry (my goal), the way to do that is produce truly
better college textbooks. I wish more college accounting professors
would think seriously about how textbooks could be improved. At the AAA
meeting in San Francisco in August, I compared a 1925 intermediate
accounting textbook to a 2010 intermediate accounting textbook and there
was a lot less difference than you might have expected. Textbooks have
simply failed to evolve very much (okay, they are now in color). It is
my belief that textbooks were created under a "conveyance of
information" model. An educated person writes a textbook to convey
tons of information to an uneducated person. In the age of Google,
Yahoo, Facebook, YouTube, and Wikipedia, I think the need to convey
information is no longer so urgent. I think we need to switch to a
"thinking about information" model. And, if that is the goal, the
Socratic Method is perfect. You can start off with a question like
"Company X reports inventory at $500,000. What does that mean? Is it
the cost or is the retail value? And, if it is one, why is not the
other?" Accounting offers thousands of such delightful questions.
But, I digress -- you asked about CPAreviewforFREE. We just finished
our 117th week and it has been so much fun. We had a person write in
this week (on our Facebook page) to tell us that she had made three 99s
and an 89. Over the summer, we averaged about 300,000 page views per
week. That is page views and not hits but that is still a lot of
people answering a lot of questions.
We are currently writing new questions for the new exam starting in 2011
including task-based simulations, IFRS, and written communications
questions for BEC. I personally think the exam will change less than
people expect. Currently, roughly 50 percent of the people who take a
part pass that part. I would expect that in January under the new CPA
exam format, roughly 50 percent of the people who take a part will pass
that part. And, I would guess it will be almost exactly the same 50
percent.
However, to be honest with you, we are in the process of adding a
subscription service. I don't know if you ever go to ESPN.com but they
give a lot of free information (Red Sox beat the Yankees last night
10-8) but they also have a subscription service where you can learn
about things in more depth for a monthly fee (almost like a
newspaper). Our 2,100 free questions and answers will ALWAYS stay
free. But we found that people really wanted to have some content.
If they missed a question on earnings per share, for example, they
wanted to know more about how convertible bonds are handled in that
computation. They didn't feel the need to pay $2,500 (don't get me
started on what I think about that) but they wanted a bit more
information.
To date, we have subscription content for FAR and Regulation. Each is
available for $15 per month which I think is a reasonable price
(especially in a recession). (As an aside, I have long felt that the
high cost of CPA review programs keeps poor people out of the profession
which I think is extremely unfair and even unAmerican.) In our FAR
content, for example, we have 621 slides that cover everything I could
think of that FAR will probably ask about. There are probably more
slides in Regulation but I haven't counted them yet. BEC and Auditing
will be ready as quickly as possible. When you have no paid employees,
things only get done as fast as you can get them done.
Bob, I was delighted to see your name on my email this morning. I'm
actually in Virginia Beach on a 2 day vacation but decided I'd rather
write you than go walk on the beach :). If I can ever address more
questions about textbooks, CPAreviewforFREE, or the Red Sox and the
Yankees, please let me know. As my buddy Paul Clikeman (who is on the
AECM list) will tell you, I am a person of opinion.
Joe
See
---
http://cpareviewforfree.com/
One site of possible interest for international accountants is the
International Qualification Exam site ---
http://www.nasba.org/nasbaweb/NASBAWeb.nsf/wpeip?openform
However, you may have to have a higher
CA credential for the IQEX, but it's worth a try.
Best states for International Student CPA Candidates ---
http://ipassthecpaexam.com/cpa-international-students/
Check for updates, however, because some of this information is outdated
Bisk Sites
Bisk CPA Examination Review
http://www.cpaexam.com/cpa-review-courses
Bisk Awards for Accounting Resources in 2012---
http://www.cpaexam.com/top-accounting-resources-2012
cfo-coach.com - Helping CFO's Repackage, Position, and Land!
Dr.DavidKass - Commentary on Warren Buffett and Berkshire
Hathaway.
360taxes.org -360 Degrees of Taxes is a public service site,
designed by Certified Public Accountants and sponsored by the AICPA,
offering tips and checklists to help you during tax season and with
year-round tax planning.
accountingcoach.com - Changing the way people learn accounting.
BobJensonattrinity. BobJensenatrinity.edu - Daily entries, fraud
updates, and insightful conclusions (
http://faculty.trinity.edu/rjensen/ )
financial-market-commentary.com - Financial commentary you can
trust.
"The AICPA Talks to Going Concern About the New CPA Exam," by
Jr. Deputy Accountant and often foul-mouthed Adrienne Gonzalaz, Going
Concern, January 14, 2011 ---
http://goingconcern.com/2011/01/the-aicpa-talks-to-going-concern-about-the-new-cpa-exam/
Because I genuinely care about the
well-being of you little CPA exam candidates out there, I recently
put aside the inflammatory nonsense for a moment and took some time
out of my busy schedule to chat with the AICPA about the new CPA
exam that
they were proud to say launched early this month without a hitch.
We’re pretty excited about that too, mostly
because it means we can finally stop talking about 2011 changes and
get back to talking CPA exam strategy, which is largely unchanged as
a result of CBT-e.
We here at Going Concern value reader input
(even if we do value chastising said reader just as equally) and
therefore reached out to get
your input on the sorts of questions we should ask.
You spoke and we listened so let’s cut right
to the chase and give you some answers.
John Mattar,
Ed.D., Director of Psychometrics and Research and Mike Decker,
Director of Operations and Development, both of the AICPA
Examinations Team, were kind and brave enough to speak with me and
give me plenty of insight on the brain behind the new CPA exam.
First of all, we need to talk scoring as
that’s the one thing you guys have complained about consistently
since the exam went computerized in 2004 (except for written
communication but that is an entirely different issue). We’re proud
to tell you that we can finally say with certainty that the AICPA
will not be changing the passing score from 75 moving
forward. That’s right, put down your flaming pitchforks,
all you 74s who were ready to flip should the score have been
lowered to 70. “In terms of the score reported to candidates, right
now the passing score on that reported scale is a 75 and it’s going
to remain there because we want to have consistency over time,” John
told us.
That means a 75 last year might not
necessarily be the same as a 75 this year but a 75 is still passing
and that’s what matters. As we all know, the AICPA uses a
complicated and mysterious psychometric formula to determine weights
for each question and bases a candidate’s score on this formula. It
isn’t for you, little candidate, to worry about how they come up
with their numbers nor should you feel as though the AICPA gets some
sick thrill out of seeing you get a 74. Believe it or not, they’re
neutral. They don’t care if you pass or fail, they only care about
overseeing a professional examination that successfully tests the
knowledge base of entry-level CPAs in the United States. That’s it.
Second, while
the AICPA will be using a single score release formula
for at least the first three testing windows
of the year, candidates can anticipate a new and improved score
release system that will hopefully be introduced by the end of the
year. This means all candidates who test early in their window will
be eligible to receive their scores in the first release and all
other candidates can expect to receive their scores in more frequent
batches through the end of that window’s blackout month. So forget
the Wave 1/Wave 2 nonsense. “Due to a lot of the work we’re doing on
the backend, we’re going to be able to release scores faster. We’re
not actually going to be able to release the scores earlier until
the 4th quarter because we need to do a greater analysis in the
first three quarters,” Mike said. So while you guys see the new
simulations and international content on the frontend, it’s
important to remember that a lot of time and effort went into
improving the backend of the CPA exam and faster scoring is one such
improvement that we can expect to see by the end of the year. But
these changes come at a price so be patient while the AICPA works
through the first three windows of this year to finalize their new
scoring process.
If you haven’t already, I recommend you
check out
How the CPA Exam is Scored for more
details on this process. Expect an update to that document when new
scoring takes effect later in the year.
As for CBT-e content, I initially
congratulated the AICPA for finally streamlining some questionable
areas of the exam (especially BEC) in the updated
CSOs/SSOs but
forgot that they don’t actually come up with content on their own.
You can thank
an extensive practice analysis and subsequent input from practicing
CPAs for the CPA exam you know and love
today, a process that takes into account input from the profession
on what entry-level CPAs should know. That means the introduction of
international financial reporting and auditing standards is entirely
independent of the SEC’s do-we-or-do-we-not IFRS roadmap. This
should be a comfort to some of you who are wondering just how much
IFRS will appear on the exam in coming windows as it means the exam
will most likely continue to test remedial international content and
will mostly focus on major differences between IFRS and GAAP.
Entry-level CPAs in the U.S. are not expected to be experts in IFRS,
just as they are not expected to be experts in cost accounting,
government accounting, non-profit accounting or any number of areas
that have been consistently tested on the CPA exam for years now.
The best news is that though the e
in CBT-e stands for evolution, those expecting to take the
exam in 2012 or beyond shouldn’t expect such a large overhaul as we
just saw any time soon. “We don’t plan to change the exam,” John
said. “What we plan to do is keep the exam current with the
profession to protect the public interest. If we do have significant
changes in test content we would have to let candidates know in
advance.”
That being said, the largest takeaway I got
from my conversation with the AICPA was that they are simply
interested in providing a consistent examination that continues to
evolve to meet the needs of the profession. I swear to you that they
really don’t get a sick thrill out of torturing you guys with
changes, scoring delays and new content though it may appear that
way sometimes, especially if you’re in the 74 x 3 club. It’s their
job to make sure that the CPA exam represents the best interests of
the profession, which means revising their strategy to keep up with
the evolution of the industry.
We applaud the AICPA on a job well done and
congratulate them for a successful CBT-e launch. So far, candidate
feedback I have gotten on the new exam format has been mostly
positive, which means that their hard work was totally worth it.
Bob Jensen's threads on the CPA examination are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010303CPAExam
Educational Resources and
Exams to Become an Accountant or CPA ---
http://www.accountingedu.org/
NASBA ---
http://en.wikipedia.org/wiki/Nasba
NASBA video that you may want to watch ---
http://bit.ly/HowToBecomeACPA
"NASBA Gives Its Accounting License Library a Makeover," by
Adrienne Gonzalez, Going Concern, July 23, 2010 ---
http://goingconcern.com/2010/07/nasba-gives-its-accounting-license-library-a-makeover/
For those of you that aren’t already aware,
we implore you to check out NASBA’s incredibly useful
Accounting
Licensing Library – a
comprehensive, continually-updated database that can help future
CPAs find a state in which to be licensed and offers accounting
firms access to important state data to assist in their efforts
across state lines. In other words, the tool’s main goal is to
facilitate mobility by bringing all 55 jurisdictions together in one
easy-to-use area while offering a one-stop shop for those
considering CPA licensure.
We recently got a chance to chat with NASBA
General Counsel and Director of Business Development Maria Caldwell
about the new ALL.
The new ALL tool features
a
new section for accounting students, an
enhanced state requirement comparison research tool and expanded
product information. The refreshed ALL website offers the same
features and benefits as the previous site in a more user-friendly
format. Users can find detailed licensing information and even use
their research tool to determine if their educational requirements
meet any state’s licensure requirements without having to click
through each state board’s website individually. This is huge for
candidates and for NASBA, as it allows them to spend more time
dealing with candidate issues and less time pointing candidates in
the right direction.
The birth of the ALL actually began within
NASBA four years ago as they wanted a single resource for internal
use that would take each state board’s requirements and aggregate
them into one place. “There really wasn’t one source to go to and
look up all these different rules, so that was the impetus for
putting the tool together,” Caldwell told us. “We wanted to offer it
to firms at first but once it was out there we realized there were
several different audiences using it. Students use it as a licensing
tool and international candidates use it as well.”
With over 700 candidates accessing the tool
per year (before the makeover) and a significant leap in CPA exam
applications since the first whispers of an economic downturn in
2008, interest in the tool and CPA licensure does not appear to be
waning any time soon.
Beyond the licensure aspect of the tool,
the ALL gives both individuals and firms a way to improve their own
economic outlooks by reaching across state lines to find clients.
“In this kind of environment, the firms are looking to neighboring
states if their state is suffering from a lack of business,”
Caldwell said. The tool allows for mobility without firms wasting
countless hours combing through state requirements and allows CPAs
in a specialty practice to meet the needs of clients who may be in
areas that lack qualified accountants who offer their specialized
services.
As the CPA exam prepares to go
international, NASBA is counting on increased interest in not only
the ALL but the all-important CPA designation. Let’s face it, not
every industry can say it has weathered the economic downturn as
well as CPAs have and passing the exam is still considered a
prestigious accomplishment across the globe.
Great job, NASBA, we definitely approve!
Bob Jensen's threads on passing the CPA Examination ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010303CPAExam
Educational Resources and
Exams to Become an Accountant or CPA ---
http://www.accountingedu.org/
How will IFRS affect the 2011 CPA Examinations?
If I Pass CPA Exam Parts in 2010, Will I Have to Pass Them Again in
2011?
Click Here
http://goingconcern.com/2010/06/if-i-pass-cpa-exam-parts-in-2010-will-i-have-to-pass-them-again-in-2011/#more-12870
Bob Jensen's threads on accountancy careers
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Skills and knowledge should be required as part of the pre-certification
education of CPAs
Prompted by New York’s forthcoming adoption of the
150-hour requirement to sit for the CPA exam, the NYSSCPA’s Quality Enhancement
Policy Committee drafted a white paper to encourage discussion on what skills
and knowledge should be required as part of the pre-certification education of
CPAs. This white paper, which was approved by the Society’s Board of Directors,
is presented here, along with additional commentary from the NYSSCPA’s Higher
Education Committee.
Quality Enhancement Policy Committee Sharon Sabba Fierstein, Chair, August 2008
---
http://www.nysscpa.org/cpajournal/2008/808/infocus/p26.htm
Mary-Jo Kranacher, Editorial, CPA Journal, August 2008 ---
http://www.nysscpa.org/cpajournal/2008/808/essentials/p80.htm
Specific requirements for becoming a CPA, and the rights and obligations of a
licensed CPA, are set forth in the laws and regulations of 54 United States
jurisdictions ---
http://www.cpa-exam.org/global/boards.html
NASBA Tools ---
http://www.nasbatools.com/display_page
NASBA Resources (Includes documents and audio files on knowledge requirements)
---
http://www.nasba.org/nasbaweb/NASBAWeb.nsf/wpmtp?openform
Free and Fee CPA Review Courses ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010303CPAExam
Bob Jensen's threads on accountancy careers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
"Pre-Med
Education Must Be Compatible with Liberal Arts Ideals," by Timothy R. Austin,
Inside Higher Ed, July 31, 2008 ---
http://www.insidehighered.com/views/2008/07/31/austin
Although you might not agree with
some of Irv's opinions below, the announcement is important to note.
Irv probably knows more about
accounting and flying (i.e., pilot) certification examinations than any
other human being in the U.S.
Bob Jensen
-----Original
Message-----
From: Irvin Gleim [mailto:irvin.gleim@gleim.com]
Sent: Tuesday, March 23, 2004 5:42 PM
To: Jensen, Robert
Subject: Major CMA Exam Changes Affecting Your Students
The IMA is
making substantive changes to the CMA exam beginning July 1, 2004. The
IMA will release a new exam this summer and will remain in 4 parts,
although it will be significantly different than the prior exam.
However, there is good news; the current exam (unchanged) will be
available to your students until December 31, 2007, PROVIDED YOUR
STUDENTS REGISTER FOR THE CURRENT CMA EXAM PRIOR TO JUNE 30, 2004.
The current CMA
exam is an easier exam to prepare for and pass. Your students should
consider pursuing the CMA either in place of the CPA or in addition to
the CPA. The total cost to take the CMA as a student is $265;
undergraduate students can take the exam, and there is not a 150-hour
requirement.
An explanation
of the reorganized CMA exam is available at http://www.gleim.com/accounting/cma/examnews/cmaexam.php
A comparison of
the current (unchanged) CMA exam with the reorganized exam is available
at http://www.gleim.com/accounting/cma/examnews/comparison.php
PLEASE
RECOMMEND THE FOLLOWING TO YOUR STUDENTS:
A. Join the IMA
for $35 (required to take the CMA exam) at https://www.imanet.org/forms/MembershipAppform1.asp
B. Decide which
part to take first: See http://www.gleim.com/accounting/cma/examnews/passfirst.php
C. Register for
the exam and pay $57.50 (which is 50% of the regular fee) per exam part.
The $75 credentialing fee is waived for students. https://www.imanet.org/forms/examregform.asp
D. Purchase
Gleim/Flesher CMA Review. Substantial discounts are available through
Gleim's complimentary Academic Site License program. Call 800-874-5346,
ext. 104 for details.
E. Study CMA
Review books, software, and audios (approximately 40 hours) per part.
F. Take and
pass each part.
G. Continue
with any remaining parts and become a CMA and/or CFM.
Irv
Dr. Irvin
N. Gleim
Gleim Publications, Inc.
P.O. Box 12848
Gainesville, FL 32604
352-375-0772, x.110
800-87-GLEIM, x.110
352-224-1310, direct
352-870-2742, cell
Fax 888-375-6940
http://www.gleim.com
June 23, 2004 message from Irv Gleim
[irvin_gleim@gleim.com]
The IMA will
make substantial changes to the CMA Exam beginning July 1, 2004. These
changes will include a new essay section that incorporates material from
all four exam sections. In addition, CPAs will no longer be waived from
the financial accounting and reporting material, and will instead be
waived from economics and business applications topics.
However, there
is good news; the current exam will be available until December 31,
2007, allowing plenty of time for completion. BUT, you must apply by
June 30, 2004. In other words, APPLY NOW! Click the link below to open
the online registration form.
https://www.imanet.org/forms/examregform.asp
Gleim will
continue to provide up-to-date materials throughout the current exam's
duration. Gleim will also release a new edition for the revised exam
this summer so that we will be able to meet all of your students'
certification needs. You can view more information on Gleim's CMA Review
and see how we will prepare your students to PASS by visiting the link
below:
http://www.gleim.com/accounting/cma?lj062204
CPA Exam Information and Vendors
NASBA ---
http://en.wikipedia.org/wiki/Nasba
NASBA video that you may want to watch ---
http://bit.ly/HowToBecomeACPA
NASBA 2008 Update: 120 Versus
150-Credit Hour Requirement to Become a CPA
There are now only two states that do not require 150-credits to become a CPA, with California being the largest jurisdiction
Most states require 150 credits to sit for the CPA examination, whereas a few
states impose the 150-credit rule for licensure only
DRAFT Education and Licensure
Requirements for Certified Public Accountants: A Discussion Regarding
Degreed Candidates Sitting for the Uniform CPA Examination with a
Minimum of 120 Credit Hours (120-Hour Candidate) and Becoming Eligible
for Licensure with a Minimum of 150 Credit Hours (150-Hour Candidate)
(120/150 Discussion), Issued by the National Association of State Boards
of Accountancy (NASBA) , November 2008 ---
http://snipurl.com/150nasba [www_nasba_org]
http://www.nasba.org/862571B900737CED/318CD757B9F57F75862574FA00763F36/$file/120_150_Paper_Draft_November_08.pdf
The above draft has quite a lot of data
and provides extensive history of the 150-Hour Rule.
For a wider history see
http://en.wikipedia.org/wiki/Uniform_Certified_Public_Accountant_Examination
Part of the above Wikipedia module was out of date, so I changed the
Wikipedia module on December 13, 2008.
NASBA
has some learning tools at
http://www.nasbatools.com/display_page
Free CPA Examination Review
Course ---
http://cpareviewforfree.com/
AccountingWeb Student Zone ---
http://www.accountingweb.com/news/student_zone.html
For many students, the fee-based CPA
Examination Review materials and courses are likely to get better
results, especially those that force students to weekly stay on track
and those that have multimedia helpers and those that meet onsite as a
regular class.
-
Accounting Institute Seminars
Becker CPA Review
Bisk-Totaltape CPA Exam Review
Conviser Duffy CPA Review (now merged with
Becker)
CPA Review Twin Cities
CPAexcel CPA Exam Review
Dynasty School
Exam Matrix (formerly Micromash)
Gleim Publications
Hoyle CPA Ventures (now free)
Intensive CPA Examination Review
Kaplan
Lambers
Mark's CPA Review
Person/Wolinsky CPA Review Courses
Rigos Professional Education
The Tutorial Group, Inc.
Wiley CPA Exam Review
Wise Guides
Bob Jensen's career helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Online continuing
education credit CPE programs for accountants
McGraw-Hill CPE Online from McGraw-Hill/Irwin at http://www.mhcec.com
CPEasy from Bisk Publishing at http://www.cpeasy.com
Insight CPE from Insight CPE at http://www.insight-cpe.com
Association
of Government Accountants
Continuing Education --- http://www.agacgfm.org/education/index.htm
CPE Internet from the University of Phoenix at http://www.cpeinternet.com/catalog/default.asp
Jouarnal CPE Online from Rutgers University at http://rarc.rutgers.edu:80
Best CPE (for tax only) from Hardwick Publications at http://www.bestcpe.com
ICPE from the Institute for Continuing Professional Education at http://www.icpe.com (No longer available for public
access)
A review is provided in the Journal of Accountancy, November 1998,
59-62. Online Journal of Accountancy articles can be found at http://www.aicpa.org/pubs/jofa/joaiss.htm
Internet Companies
Directory (A Partial Listing)
COMPANY |
DESCRIPTION |
URL |
e-Retail
(consumer products and services) |
1-800
Contacts |
Contact
lenses |
http://www.1800contacts.com/ |
Alloy
Online |
Goods
for teens |
http://www.alloy.com/ |
Amazon.com |
Books,
music, electronics |
http://www.amazon.com |
Autobytel.com |
New,
used car guide |
http://www.autobytel.com/ |
Barnesandnoble.com |
Books,
music |
http://www.barnesandnoble.com/ |
Drugstore.com |
Medical
products |
http://www.drugstore.com/ |
eBay |
Auctions |
http://www.ebay.com/ |
Egghead.com |
Computer
products |
http://www.egghead.com/ |
Expedia |
Travel
planning |
http://www.expedia.com/ |
Hotel
Reservations Network |
Discounted
hotel rooms |
http://www.180096hotel.com/ |
Priceline.com |
Travel
reservations |
http://www.priceline.com/ |
Stamps.com |
Postage |
http://www.stamps.com/ |
Ticketmaster |
Guides,
tickets |
http://www.ticketmaster.com/ |
Travelocity.com |
Travel
reservations |
http://www.travelocity.com/ |
e-Finance
(banks, brokerages and credit companies) |
Ameritrade |
Securities
broker |
http://www.ameritrade.com/ |
Charles
Schwab |
Securities
broker |
http://www.schwab.com/ |
CSFBdirect |
Securities
broker |
http://www.csfbdirect.com/ |
E-Trade |
Securities
broker |
http://www.etrade.com |
IndyMac
Bancorp |
Mortgage
lender |
http://www.indymacbank.com/ |
Intuit |
Personal
finance info |
http://www.intuit.com/ |
NetBank |
Consumer
banking |
http://www.gefn-compubank.com/ |
NextCard |
Consumer
credit |
http://www.nextcard.com |
TD
Warehouse |
Securities
broker |
http://www.tdwaterhouse.com/ |
Wit
SoundView |
Securities
broker |
http://www.witsoundview.com/ |
e-New
Media (advertising/subscription-supported media) |
AOL
Time Warner |
Consumer
content |
http://www.aoltimewarner.com/ |
Ask
Jeeves |
Search
engine |
http://www.ask.com/ |
Cnet
Networks |
Technology
content |
http://www.cnet.com/ |
HomeStore.com |
Real
estate content |
http://www.homestore.com/ |
HotJobs.com |
Career
content |
http://www.hotjobs.com/ |
InfoSpace |
Wireless
content |
http://infospace.com/ |
MarketWatch.com |
Financial
content |
http://cbs.marketwatch.com/ |
McAfee.com |
Computer
protection |
http://mcafee.com/ |
MP3.com |
Music
content |
http://www.mp3.com/ |
Multex.com |
Financial
content |
http://www.multexusa.com/ |
NBC
Internet |
Consumer
content |
http://www.nbci.com/ |
SportsLine.com |
Sports
content |
http://sportsline.com/ |
Terra
Lycos |
Consumer
content |
http://www.terralycos.com/ |
TheStreet.com |
Financial
content |
http://www.thestreet.com/ |
Apollo
Group U of Phoenix Online |
Education
content |
http://www.ipopros.com/histdeal_pla.asp?deal=2285 |
Yahoo |
Web
guide |
http://www.yahoo.com/ |
e-Access
providers (connections to the Internet) |
Aether
Systems |
Wireless
Internet access |
http://www.aethersystems.com/ |
Excite
At Home |
Internet
access |
http://www.excite.com/ |
EarthLink |
Internet
access |
http://www.earthlink.net/ |
Juno
Online Services |
Internet
access |
http://www.juno.com |
Metricom |
Wireless
Internet access |
http://www.metricom.com/
IMPORTANT NOTICE:
Please be advised that Metricom has filed for Chapter 11 bankruptcy
protection. |
NetZero |
Internet
access |
http://www.netzero.net/ |
Prodigy
Communications |
Internet
access |
http://www.prodigy.com/ |
RCN |
Internet
access |
http://www.rcn.com/ |
Research
in Motion |
Wireless
Internet access |
http://www.rim.net/ |
WorldGate
Communications |
Internet
access |
http://www.wgate.com |
e-Learning
providers (corporate) For more details go to http://faculty.trinity.edu/rjensen/000aaa/0000start.htm |
Caliber |
Training and
executive dev. |
http://www.caliber.com/ |
Pensare |
Executive development with plans for degree programs
in partnership with prestige universities |
http://www.pensare.com/ |
UNext |
Executive development and for-credit programs through
UNext's Cardean
University and in partnership with prestige universities |
http://www.unext.com/ |
Smart Force |
Executive development |
http://www.smartforce.com/ |
Quisic |
Content development, executive development, and
for-credit courses |
http://www.quisic.com/
(Formerly called University Access) |
Headlight (From
CyberU) |
Recreational learners and an online small business
training center |
http://www.cyberu.com/training/headlight/index.asp |
OnlineLearning.net |
Training and executive development and for-credit
courses |
http://www.onlinelearning.net/ |
University of Maryland University College |
Training and executive development and for-credit
courses |
http://www.umuc.edu/ |
Fathom (headed by Columbia University in conjunction
with many prestigious partners) |
A huge knowledge portal that offers over 600 courses |
http://www.fathom.com/index.jhtml |
New York University Online |
Training and executive development and for-credit
courses |
http://i5.nyu.edu/~jmm282/nyupage.html |
University of Phoenix |
Training and executive development and for-credit
courses (The largest accredited private university in the world.) |
http://www.phoenix.edu/index_open.html |
The Kaplan Colleges |
Training and executive development and for-credit
courses (including the online Concord School of Law) |
http://www.kaplancollege.com/ |
Sylvan Learning Systems |
Training and executive development and for-credit
courses (and testing centers) |
http://www.sylvan.net/ |
Intellnex from Ernst & Young (the first Big 5
accounting firm university) |
Training and executive development |
http://www.intellinex.com/flash/index.htm |
Many
other corporate providers are discussed in a book that can be
downloaded free:
The Business of Borderless Education, by S.C. Cunningham, et
al., (Australian Department of Education, Evaluations and
Investigations Programme of the Higher Education Division, 2000).
Hard Copy ISBN 0 642 44446 3 and Online Copy ISBN 0 642 44447 1 --- http://www.detya.gov.au/archive/highered/eippubs/eip00_3/bbe.pdf |
Bob Jensen's documents on e-Learning are available free at http://faculty.trinity.edu/rjensen/000aaa/0000start.htm
(Note that most prestige universities have already or are forming
private corporations for online delivery of training, executive
development, and for-credit courses)
Bob Jensen's other bookmarks
are at http://faculty.trinity.edu/rjensen/bookbob.htm
- Jim Hasselback's
On-line Accounting Faculty Directory
- Jim Hasselback's
On-line Accounting Faculty Directory (Prentice-Hall Web Site)
Gerald Trite's great
set of links --- http://iago.stfx.ca/people/gtrites/Docs/bookmark.htm
-
Accounting Journals Index
Innovation in Accounting Education Award 1999 Submissions to the
American Accounting Association
(I will review some of these documents in future editions of New
Bookmarks)
http://www.rutgers.edu/Accounting/raw/aaa/facdev/teaching/awardsub.htm
AICPA Professor/Practitioner Case Development Program
Please be informed that the winning case materials (student notes only) are now available
on the Institute Web site at http://www.aicpa.org/members/div/career/edu/caseidx.htm.
Dennis Schmidt's Accounting and Tax
Guides
Prentice Hall Online Gallery
- Bob Jensen's Links
e-Commerce and e-Business Helpers for Accountants ---
http://faculty.trinity.edu/rjensen/ecommerce.htm
-
accounting history
- AICPA Home Page
AICPA The Vision Process
- Featured Applied
Ethics Web Site
- The AICPA Issues
Business Fraud Case Studies --- http://www.aicpa.org/antifraud/spotlight/030409_cases.asp
- Tax and Accounting Sites Directory
- Rutgers Accounting on the Web Mailing
List WWW Gateway
- World-WideGraduate School Directory
- WELCOME TO THE CPA VISION PROJECT!
- Arthur
Andersen - History of Accounting
- Home Page for MicroMash
- Chapters (Internet Guide for Accountants
by Kogan, Sudit, and Vasarhelyi)
- Accounting,
Management and Information Technologies
- ANet Home Page
ANet Australia home (International Accounting Network)
- CUSI at Pacioli
- Ernie. Your online business consultant.
- http://www.isworld.org/isworld.html
- International Accounting Network - Hawaii
- Rutgers Accounting
Web Introduction
- The Nordic Accounting Network
- US University's
Accounting Departments
- School of
Accountancy (U. of Waterloo)
- Weatherhead School of Management
- Yahoo! -
Education:Higher Education:Colleges and Universities
- Accounting Education Using
Computers and Multimedia
CPA ListServ
A Forum for Accountants (Click on
Forums)
- Howard Schilit wrote a (1993) book called "Financial Shenanigans: How To Detect
Accounting Gimmicks & Fraud in Financial Reports". He has since opened a web site
at http://www.cfra-online.com/ . You can
compare prices on his book at by entering the ISBN number 0070561311 at http://isbn.nu/
Associations in Accounting Education ---- See
Accounting, Accounting Profession and Issues
Accounting
Software
-
"Technology 2012 Preview: Part 2 Experts explore hot topics in
software, hardware, security, social media and video," by Jeff
Drew, Journal of Accountancy, December 2011 ---
http://www.journalofaccountancy.com/Issues/2011/Dec/20114544.htm
"Technology 2012 Preview: Part 1 Experts explain what should be at the
top of your tech wish list for the new year," by Jeff Drew,
Journal of Accountancy, November 2011 ---
http://www.journalofaccountancy.com/Issues/2011/Nov/20114310.htm
Software Buying and Use Guides
SMB
Finance and Accounting Checklist
What a great site Saeed. Thank you.
Great accounting software guide ---
http://en.wikipedia.org/wiki/Accounting_software
On the personal financing and investment side of
things, I like the following link:
"The Best Online Tools (software, services) for
Personal Finance," The Wall Street Journal, June 8, 2009 ---
http://faculty.trinity.edu/rjensen/PersonalFinanceTools.htm
WebFilings for SEC and XBRL Reporting (Object Oriented Database) ---
http://www.webfilings.com/
For SEC reporting professionals,
WebFilings is a revolution in collaboration software for
regulatory compliance, delivering the only complete, integrated
solution to meet SEC reporting requirements.
-
Jensen Comment
Note the XBRL tab ---
http://www.webfilings.com/xbrl
AccountingWeb's 2009 Tax Software Review for Professionals, November 2009
Featured Tax
Software
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Bob
Jensen’s small business helpers are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#SmallBusiness
-
-
-
"The Best Online Tools (software, services) for Personal Finance,"
The Wall Street Journal, June 8, 2009 ---
http://faculty.trinity.edu/rjensen/PersonalFinanceTools.htm
1. Budgeting Your Money
2. Creating a Financial Plan
3. Tracking Investments and
Getting Advice
4. Checking for Fraud
5. Keeping Track of Credit
6. Managing Loans
Details at
http://faculty.trinity.edu/rjensen/PersonalFinanceTools.htm
Bob Jensen's helpers for personal finance ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Bob Jensen's threads on Accounting Software ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
-
Software Buying Guides
SMB
Finance and Accounting Checklist
"A New Alternative for Taking and Sharing Notes: 3Banana Notes,"
by Mark Sample, Chronicle of Higher Education, September 9, 2010 ---
http://chronicle.com/blogPost/A-New-Alternative-for-Taking/26761/?sid=wc&utm_source=wc&utm_medium=en
In my recent ProfHacker guide to
5 Android Apps I Can't Live Without, there was
one seemingly obvious mobile application missing from my list: Evernote,
which has gotten a
lot
of
attention on ProfHacker. That wasn't an
oversight on my part. I rarely use Evernote, for many reasons: I don't
like the way it locks up my data, the desktop client is distractingly
cluttered, and both the Apple and Android app interfaces are forgettable
and unintuitive. And then there's Evernote's firepower. It's too much
application for my purposes. I don't know about you, but I don't
need my grocery shopping list tagged with keywords and filed away in
notebooks. Bloated with features, Evernote is simply not useful
for quick and dirty notes.
What I use instead is 3Banana Notes, an
application available for
iPhone and
Android devices, powered in the cloud by
Snaptic.com.
Besides being oddly named, 3Banana is free,
ad-free, incredibly lightweight, but
powerful enough to corral the bits and pieces of my information
stream—and then share them when needed.
Here's what you see when you open the
application (I'm demonstrating the Android version, but its iPhone
counterpart is nearly identical.
Continued in article
Business Technology from Business Week Magazine ---
http://bx.businessweek.com/business-technology/
The Journal of Accountancy has a great monthly technology section
(with particular focus on things you never, ever thought you could do with
MS Office, particularly Excel) ---
http://www.journalofaccountancy.com/
The Q&A modules are particularly informative and should be centralized in
one place in addition to monthly editions.
Bob Jensen's threads on education technology ---
http://faculty.trinity.edu/rjensen/000aaa/0000start.htm
- The Business / Accounting section of The New
York Times dedicated to College focus. Links to articles involving
accounting and auditing issues.
http://college.nytimes.com/guests/directory/Business/Accounting/
-
-
-
"So you want a new desktop accounting package?"
by David Carter, AccountingWeb, June 5, 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=103569
David does not mention my oft-preferred
alternative of a Webledger system (such as NetSuite) that can be
accessed at a range of needs and sizes and prices with some huge
advantages over installing accounting software on your own hardware ---
at
http://faculty.trinity.edu/rjensen/Webledger.htm
-
"Users Grade Tax Software,"
by Stanley Zarowin, Journal of Accountancy, October 2007 ---
http://www.aicpa.org/pubs/jofa/oct2007/tax_software.htm
2008 Professional Tax Software as Listed in a November 7, 2008 Accounting Web
Newsletter
From the Journal of
Accountancy Smart Stops on the Web in 2008
-
Small Business Accounting Software (Simple
Solutions promotional video) ---
http://www.youtube.com/watch?v=30CcqXrM8ug
For small and medium sized businesses I recommend looking into Webledger
alternatives ---
http://faculty.trinity.edu/rjensen/webledger.htm
PKL Accounting Education Software (for a fee) ---
http://www.pklsoftware.com/
Hello Professor Jensen
When you log into
www.pklsoftware.com you are at the home
page of PKL. All of the products listed are currently available for a
professor to choose. To view any product just click on the product
button. To log into view a product, just enter Anonymous as your ID/Name
and Anonymous as your Password.
All products are web-based, will run on any
computer. They include:
1. Practice sets at three different levels:
Middle of Financial, End of Financial, Cost, Managerial, or Intermediate
2. Work4Me Problems: Twenty individual business
problems emphasizing key topics of Financial Accounting
3. Accounting Coach: Twenty-five Financial
Accounting topics (algorithmic problems) that instruct, coach, teach,
and test a students skills.
I would be honored if you would allow me to
save you a great deal of time by joining me, at your convenience, in a
short, WebEx demonstration of how our key products work for professors
and their students. With a WebEx demonstration, you sit at your
computer, dial into our toll-free conference call line, and you will be
looking at my screen while we talk about all of the many features we now
have included in our new products. This will give me the opportunity to
answer all of your questions.
The professors at Trinity were very excited
about what I showed them and like 95% of our demonstrations, they
adopted one of our products.
A short look at a practice set, will give you a
good picture of how our software works for all of the practice sets and
the Work4Me problems.
Seeing how our Accounting Coach helps a student
practice, learn, and then evaluate themselves on multiple Financial
topics will give you another view of what we have put together.
In a nutshell, we have a great set of products,
we just need to get the work out and we are working hard to do that. In
two weeks we will start our Spring semester and over 550 students will
be using one or more of our products.
Let me know if you like to see our work or if
you would like a professor registration code for any product.
Keith Weidkamp
Sierra College
PKL Software
Bob Jensen's threads on accounting education software are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#software
Investment Club Software ---
http://en.wikipedia.org/wiki/Investment_club_software
An Investment Club Helper Site ---
http://investmentclubsonline.com/result.php?Keywords=Investment%20Clubs
Note that investment clubs should understand state and local tax laws regarding
investment club returns and liquidations.
From the Scout Report on February 25, 2011
Mint ---
http://www.mint.com/026d/
Many people like to keep tabs on their
finances, and the Mint program may prove to be quite useful for those
looking for such a resource. After signing up, the program can
incorporate financial information from a variety of sources to make it
all accessible in one place. The program also works on mobile devices,
and users can see what's happening with their budget and financial
goals. This program is compatible with all operating systems.
"Online Accounting Tools Still Come Up Short," Rob Pegararo,
The Washington Post, May 22, 2008. Page D03 ---
Click Here
Few types of desktop software should be
readier for replacement by the Web than personal finance.
The concept behind these programs is sound:
Track your income and expenses through automatic downloads from
banks, credit card issuers and other financial institutions to show
where your money's coming and going, and how much of it you're
likely to have later on.
But the market long ago calcified into a
duopoly of programs,
Intuit's
Quicken
and
Microsoft's
Money. As they've piled on the
features, their usability has suffered. Many users, fearing an
ordeal of bookkeeping, avoid them entirely. Those who have bought
either program have been forced to ante up for new versions, at $15
to $90 each, when "sunset" policies cut older releases off from
account-data downloads.
It might seem that a simpler, cheaper
alternative to these programs would have emerged on the Web, now
that online shopping and bill payment have made people comfortable
with managing money online. But the big Web companies have yet to
craft such a thing.
Fortunately, the absence of a shiny new Web
application from
Google
or
Yahoo
doesn't mean the absence of hope for
online alternatives to Quicken and Money. It may just mean you'll
have to wait longer to find one that suits you.
The most visible Web competitor so far has
been the free Mint (
http://mint.com).
Since its
launch last fall, this Silicon Valley start-up has drawn 266,000
users, though founder Aaron Patzer did not say how many visit the
site regularly.
Quicken or Money vets may find Mint
insultingly simplistic. It only links to banks, credit cards and
investments and ignores most people's biggest debts (mortgages and
car loans) and assets (homes and vehicles), making net-worth
estimates impossible.
Using Mint requires you to trust the site
to safeguard your bank usernames and passwords, which you must save
there before adding any accounts. You can't enter transactions by
hand or upload Quicken or Money files. And you can't reconcile
transactions against a monthly statement.
But within those limits, Mint provides
soothingly simple money-management tools.
When tested with a bank account, two credit
cards and three mutual funds, Mint automatically fetched the latest
data, converted most gibberish in these accounts' downloads into
real names and filed most entries in the right category. For
example, a credit card charge to "WHOLEFDS ARL 10042 0ARLINGTON"
became "Whole
Foods," listed under "groceries."
It was even smart enough to split fees on
ATM withdrawals into separate expenses.
Mint then broke down patterns of income and
expenses into easy-to-read pie charts.
Mint aims to make money by suggesting
better financial services, then collecting commissions. But its
advice to drop an
American Express
card for a Chase Visa ignored the AmEx card's cash rebate.
Two other sites have begun grabbing users
as well. The free Wesabe (
http://wesabe.com),
an older
Silicon Valley start-up, acts like a money-minded social network.
It makes the collective wisdom of its users
part of its source code, comparing your spending and earning with
the averaged habits of more than 100,000 other "Wesabeans." It also
relies on their accumulated input to refine and sort statement
entries and offer tips about better deals near you.
But Wesabe may need more users (at least
near Washington) to do those jobs well. Most downloaded transactions
came through in their original, cryptic bankspeak, and some tips
showed a Bay Area bias.
This site's free-form system of tagging, in
which you can slap multiple categories onto a single transaction,
also yielded duplicate entries in its spending summaries.
Wesabe (which plans to underwrite its free
service with a fee-based "pro" option) is even more limited than
Mint. It couldn't connect to a Bank of America Visa credit card
account, and it doesn't do investments or home or car loans.
In Wesabe's favor, it offers free Mac and
Windows uploader programs that keep your account logins on your
computer and offers multiple ways to get your data off the site. It
even posts a toll-free number that you can call to reach its chief
executive each afternoon.
Wesabe may appeal most to extroverts with
specific financial goals who can easily set targets and solicit
fellow users' advice in its forums.
One of the newest Web-based personal
finance tools comes from Intuit, which in January launched the
$2.99-a-month Quicken Online (
http://quickenonline.com).
Although this site isn't as slick or quick as Mint or Wesabe, it
supports investments and mortgages, not just banks and credit cards.
Unlike Mint and Wesabe, it also lets you
add coming transactions -- no risk of forgetting the check you wrote
to your contractor-- and set bill-payment reminders.
Some basic features, such as transaction
breakdowns and the ability to upload Quicken files or download data
from the site, still aren't there. But its simplicity makes the
gridlocked complexity of desktop Quicken look painfully obsolete.
These sites and other competitors promise
tantalizing upgrades. For example, Mint says it will soon add
mortgages, with estimates of home values from
Zillow.com or
another assessment source.
With such improvements, some smart
borrowing (picture Mint's interface plus Wesabe's social smarts) and
a solid record of security, Web personal-finance software could
become an alternative along the lines of Web e-mail. Some people
might never accept such a thing, but others wouldn't think of using
anything else
Jensen Comment
Pegararo failed to research online complete Webledger systems such as
Net Suite and other important sites that will not only perform
accounting functions, manage inventories, manage receivables, perform
financial analyses, and do all sorts of sophisticated financial
analyses. These Webledger systems will also store accounting records so
they can be accessed all over the world and allow users to avoid paying
for expensive hardware/software technical support, backup systems, and
consultants ---
http://faculty.trinity.edu/rjensen/Webledger.htm
Pegararo also fails to mention many of the personal finance Web
options and small business accounting options:
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
http://faculty.trinity.edu/rjensen/Bookbob1.htm#SmallBusiness
Pegararo might not have found the Web options coming up short if he'd
done more research for the above article.
Peachtree Accounting Practice Sets ---
http://www.perdisco.com/peachtree/
Richard Campbell uses and likes these practice sets --- Richard Campbell
[campbell@RIO.EDU]
Maple's Document Management System
October 30, 2008 message from Scott Bonacker
[lister@BONACKERS.COM]
This came as part of
a subscription to a technology newsletter, I haven't tried this
product myself. Scott Bonacker CPA, Springfield, MO]
As an
IT
professional, chances are good that
you have lots of detailed information that you have to keep track of
in order to do your job effectively and efficiently. You probably
have a multitude of documents stored in a multitude of folders on
your hard disk. Using a series of documents and folders to store all
your information is a pretty logical way of doing things, especially
when used in combination with
Vista’s Search tool and Saved
searches feature, keeping track of all that information is pretty
easy. However, it could be better — especially if all that
information could be made available in one place.
Well, I recently discovered a very nice
document manager called Maple from
Crystal
Office Systems that runs perfectly
on Windows Vista and produces what is essentially a document
database. In this edition of the
Windows Vista Report, I’ll
introduce you to Maple and show you how to use it manage your
document collection.
This blog post is also available in the
PDF format in a
TechRepublic Download.
Getting Maple
You can download Maple from the
Crystal Office Systems Web site.
Once you download it, installation is a snap and you’ll be ready
begin creating you custom document database in no time. You can
download and try Maple for 30 days at no cost. A single-user license
is $21.95.
When you access the Crystal Office Systems
Web site, you’ll also notice that there is another version of this
document manager called Maple Professional, which provides a set of
advanced features. You’ll also find free reader called Maple Reader
that will allow other users to view any document database created
with either Maple or Maple Professional.
Read the rest
at
http://blogs.techrepublic.com.com/window-on-windows/?p=802&tag=rbxccnbt
Bob Jensen's
threads on accounting software are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
Bob
Jensen's threads on tools and tricks of the trade are at
http://faculty.trinity.edu/rjensen/000aaa/thetools.htm
Software Advice ---
http://www.softwareadvice.com/
PWC Technology Forecasts
--- http://accounting.smartpros.com/x62913.xml
Also see
http://www.pwc.com/extweb/home.nsf/docid/C52206CB07A55CA385257460004DAF19
Newer software tools (in
2007) for financial analysis ---
http://www.aicpa.org/pubs/jofa/nov2007/financial_analysis.htm
THE PRODUCTS
ACCPAC CFO
(Comprehensive Financial Optimizer) is
designed for small and medium-size
enterprises and can help make
business-planning decisions by modeling the
impact of various options. This is
accomplished by demonstrating the what-if
outcomes of small changes. A roll forward
feature prepares budgets or forecast reports
in minutes. The program also generates a
financial scorecard of key financial
information and indicators.
Customized Financial Analysis
by BizBench provides financial benchmarking
to determine how a company compares to
others in its industry by using the Risk
Management Association (RMA) database. It
also highlights key ratios that need
improvement and year-to-year trend analysis.
A unique function, Back Calculation,
calculates the profit targets or the
appropriate asset base to support existing
sales and profitability. Its DuPont Model
Analysis demonstrates how each ratio affects
return on equity.
Financial Analysis CS
reviews and compares a client’s financial
position with business peers or industry
standards. It also can compare multiple
locations of a single business to determine
which are most profitable. Users who
subscribe to the RMA option can integrate
with Financial Analysis CS, which then lets
them provide aggregated financial indicators
of peers or industry standards, showing
clients how their businesses compare.
iLumen regularly
collects a client’s financial information to
provide ongoing analysis. It also provides
benchmarking information, comparing the
client’s financial performance with industry
peers. The system is Web-based and can
monitor a client’s performance on a monthly,
quarterly and annual basis. The network can
upload a trial balance file directly from
any accounting software program and provide
charts, graphs and ratios that demonstrate a
company’s performance for the period.
Analysis tools are viewed through customized
dashboards.
PlanGuru by New
Horizon Technologies can generate
client-ready integrated balance sheets,
income statements and cash-flow statements.
The program includes tools for analyzing
data, making projections, forecasting and
budgeting. It also supports multiple
resulting scenarios. The system can
calculate up to 21 financial ratios as well
as the breakeven point. PlanGuru uses a
spreadsheet-style interface and wizards that
guide users through data entry. It can
import from Excel, QuickBooks, Peachtree and
plain text files. It comes in professional
and consultant editions. An add-on, called
the Business Analyzer, calculates
benchmarks.
ProfitCents by
Sageworks is Web-based, so it requires no
software or updates. It integrates with
QuickBooks, CCH, Caseware, Creative
Solutions and Best Software applications. It
also provides a wide variety of businesses
analyses for nonprofits and sole
proprietorships. The company offers free
consulting, training and customer support.
It’s also available in Spanish.
ProfitSystem fx Profit Driver
by CCH Tax and Accounting provides a wide
range of financial diagnostics and
analytics. It provides data in spreadsheet
form and can calculate benchmarking against
industry standards. The program can track up
to 40 periods. |
|
Free General Ledger Software (Accounting) ---
http://www.responsive.co.nz/
-
New and enhanced features in QuickBooks 2010 ---
http://www.accountingweb.com/topic/technology/new-and-enhanced-features-quickbooks-2010
39 Free QuickBooks Online Tutorials ---
http://fitsmallbusiness.com/free-quickbooks-online-tutorials/
Thank you Crystalynn Shelton and Kristian Rivera --- |
http://fitsmallbusiness.com/category/accounting/
Profiles of Software Systems and Tools
---
http://www.p2pays.org/ref%5C01%5C00047/00047d.htm
RiverGuide provides in-depth profiles, comparisons, and
reviews of accounting software products, and would be a valuable resource for
users of your site ---
http://www.softwareadvice.com/construction/
Accounting Software Ratings
May 2, 2007 message from Jessica Valdes
I am writing on behalf of CTSGuides.com, which
is a site that lists accounting software reviews and ratings. We
only list qualified companies that are upstanding and reputable.
This will be a good resource to add to your site for accounting
companies that are in search of vendors who offer accounting
software. I would like to know if you'd be interested in adding our
link to your site.
Please review this information and let me know if you are interested
in such a relationship with our company. If I have contacted you in
the past, my apologies.
Title - Accounting Software Reviews and Ratings
URL -
http://www.ctsguides.com/accounting-software.asp
Description - Free portal of reviews and
ratings of accounting software to help companies consider options
for selecting new software.
Thanks and best regards!
Jessica Valdes
jessica@ctsguides.com
CTSGuides.com
"Top Technologies for Accounting Pros
Announced," SmartPros, June 11, 2007 ---
http://accounting.smartpros.com/x57964.xml
People looking for accounting and management software often forget
about the wonderful Webledger alternatives where a heavy duty IT system is
maintained in a central location by the software system vendor such that
users can access the system on the Web and do not need their own hardware,
software, and expensive maintenance technicians. Webledger systems have
excellent backup computer and power systems such that the chances of going
down are almost zero except in nuclear war.
My favorite Webledger alterntive is NetSuite at
http://www.netsuite.com/portal/home.shtml
NetSuite commenced under the name NetLedger with financing from the CEO
of Oracle. For all practical purposes it is an Oracle company.
Bob Jensen's Threads on Webledgers
for Distributed Network Computing of Accounting Systems and Business
Services
http://faculty.trinity.edu/rjensen/webledger.htm
The above site is not one that I actively update. Hence, some of the
links may be broken and their may have been some buyouts and mergers
that I've not tracked in the past year or two.
Retail Software Comparisons ---
www.softwareadvice.com/retail
The new link should go to:
http://www.softwareadvice.com/retail/
Former accounting professor Tom
Selling (Dartmouth, Wake Forest, SEC, and Thunderbird) started the
Grovesite Software Company ---
http://www.grovesite.com/
Formal Comparison of Accounting Software Packages
March 1, 2006 message from David Fordham, James Madison University
[fordhadr@JMU.EDU]
Ruth Bender asked: "...more broadly, how
should she start looking for the right package?"
One of the best tools I've ever come across
for evaluating commercial accounting software packages is called
"The Accounting Library", by a company out of Richmond Virginia
called "Solutions, Inc."
The Accounting Library software covers well
over 150 different commercial accounting packages. It includes ALL
levels of software, from Quickbooks (at the very bottom of the
product line), all the way up through SAP (the top). While 150
doesn't sound like a large number, believe me, it has everything
you've ever heard of, and more.
What you do is, you answer a set of
questionnaire-like questions dealing with the nature of your
business and what you want your accounting package to do for you.
The questionnaire can be quick-and-dirty, or extremely complex,
depending on whether you are evaluating on behalf of Mom-And- Pop's
Hotdog Stand, or Boeing Aircraft Corporation. You can spend weeks
answering the full questionnaire if you want to. yes, it covers
currency conversions (about 90 ways to Sunday as they say), analysis
of just about everything (sales, costs, by product, by client, by
sales rep, by the kitchen sink, etc.), and just about anything else
you can think of.
After telling The Accounting Library about
your business nature and what you expect the accounting package to
do for you, TAL will then rank those products which meet or come
close to your specs. You can then "drill down" into the ranking to
find out WHY one package was rated higher than another, to find out
which features you need that are or are marginally met in each
package, etc. You also have the opportunity to reconsider your
initial answers -- for example, during the drill-down exercise, you
may decide that perhaps keeping track of subassemblies by
date-manufactured isn't quite as important as you originally ranked
it, or that maybe you need to generate an "aged inventory by serial
number" report after all. You can then alter your original input,
and re-run the evaluation.
I used TAL back when I was teaching the
systems analysis classes, because it walks the students through a
good "user needs analysis"... albeit in checklist form (I had to add
a lot of meat to explain rationales, etc. and thus I used TAL as a
support tool rather than a concepts tool.)
What's more, the product has a fantastic
"introduction to accounting software", gives product descriptions
and summaries of capabilities, etc. -- in general it's just a
fantastic learning tool for comparing the many commercial- grade
accounting packages out there.
The latest editions are also aimed at
consultants who help companies procure and install software.
You might want to investigate TAL for your
friend. The website is:
http://www.accountinglibrary.com/
If you decide the product is useful,
telephone (U.S.: 1-804- 330-0000) and ask for Charles Chewning, and
tell him that David Fordham of James Madison University told you
about the product. No, I don't get a finders fee or commission, but
he is a supporter of JMU (and the AIS educator's association too!)
and might give you a discount on the product if he knows you found
it through us. (It's a steal at full price, but hey, every few
dollars helps!)
David Fordham
James Madison University
Financial Statements.xls: A
step-by-step Guide to Creating Financial Statements using Microsoft
Excel, by Joseph Rubin, CPA ---
http://www.exceltip.com/pl-fs_overview
Auditing and Audit Sampling Software
May 2, 2006 message from Douglas Ziegenfuss
[dziegenf@ODU.EDU]
I teach a graduate IT Auditing course in
which we use both ACL and Idea. Both are taught because both are
used in the business world. We use the version of ACL that comes
with Hall's IT Auditing book. Idea sells the students a version and
workbook for $25 per student and gives us a free copy of the
software and workbook. The students then load the software on their
laptops and bring them to class. This turns any classroom into a
lab. The students generally like IDEA better but still enjoy ACL.
I hope this helps.
Douglas E. Ziegenfuss
Professor and Chair,
Department of Accounting
Room 2157 Constant Hall
Old Dominion University
Norfolk, Virginia 23529-0229
ACL Business Assurance Analytics ---
http://www.acl.com/solutions/audit.aspx?bhcp=1
ACL is bundled with some auditing software textbooks, such as the
Rittenberg text ---
Click Here
IDEA Data Analysis Software ---
http://www.audimation.com/product_feat_benefits.htm
May 2, 2006 reply from Roger Debreceny
[roger@DEBRECENY.COM]
Over the years I have switched between ACL
and IDEA. I currently use IDEA in my teaching. A major factor is
that students greatly value having the ability to work on their own
computer. I do not think there are substantial differences between
the products or that the file size restrictions is a major problem.
Roger
"Small Business Software Grows Up: Intense efforts for
product improvements, by J. Carlton Collins, The Journal of
Accountancy, March 2006 ---
http://www.aicpa.org/pubs/jofa/mar2006/collins.htm
EXECUTIVE SUMMARY |
Microsoft’s
introduction this year of its small business
accounting software is challenging the two leading
competitors—QuickBooks and Peachtree—to step up their
efforts with products that are ever-more technologically
powerful.
The competition will
be intense because “Microsoft Small Business
Accounting (MSBA) is technologically more advanced than
either QuickBooks or Peachtree and its price strategy is
hard to beat: It’s bundled free in selected 2006 versions of
Microsoft Office. With more than 400 million users of
Microsoft Office worldwide, even if only a small percentage
of them upgrade to the 2006 version, the new accounting
program could be in the hands of millions of users by the
end of the year.
With products as
complex and customizable as SBA software, it’s not
prudent to rely fully on assessments of reviewers or
colleagues. The only way to be sure a product works best for
you or a client is to test it with your own accounting data.
If you’re going to
buy QuickBooks or Peachtree, purchase the
accountant’s editions. They contain nearly all the
additional functionality found in the various other versions
of the product and they’re typically priced lower.
The stakes in the
competition for small business accounting software
are high. The current estimated market of small businesses
is between 15 million and 25 million, with 500,000 to 2
million new businesses starting each year. Clearly, small
businesses will be the winner as their accounting tools
continue to improve. |
Bob Jensen's small business helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#SmallBusiness
Peachtree Accounting Practice Sets ---
http://www.perdisco.com/peachtree/
-
-
Free Spreadsheet Software
December 13, 2005 message from Richard J. Campbell
[campbell@RIO.EDU]
Ray Ozzie of Microsoft has been talking
about providing pieces of Office as a web service.
Here is a link to a free online
spreadsheet:
www.numsum.com
Richard J. Campbell
The American Institute of Certified Public Accountants (AICPA)
unveiled a new Information Technology (IT) community Web site that
contains resources, tools and guidance for CPAs interested or practicing
in IT ---
http://infotech.aicpa.org/
Technology is the great enabler and one of
the most powerful forces of change. Ever evolving and dynamic,
technology touches much of what we do as CPAs. CPAs are able to
utilize and leverage technology in ways that add value to clients,
customers, and employers. The AICPA supports technology and
technology-enabled services to improve business objectives and
decision-making processes, including: business application
processes, system integrity, knowledge management, system security,
and the integration of new business processes and practices.
Beyond Excel
ActiveData for Office is a major step forward for our
users and for InfromationActive,” Michael Pluscauskas, President of
InformationActive Inc. said in a press release announcing the general
availability. “This product provides our customers with a flexible and dynamic
platform that not only breaks the Microsoft Excel™ row barrier, but also is
adaptable and expandable for future planned functionality. Users have been
asking for a powerful data analysis tool that works with Microsoft Office and we
have given them that and much more. I’m also proud of the fact that we’ve
provided an exceptionally robust product at a very competitive price.”
ActiveData for Office stretches the boundaries of traditional data analysis
tools by providing exceptional integration with Microsoft Office. Users can
append documents and web pages to their analysis and archive the entire file in
addition to analyzing millions of rows of data quickly thus providing new levels
of information control while still allowing the flexibility to view results
within ActiveDatae for Office or Microsoft Excel. ActiveData for Office also
includes macro capability for recording commonly performed tasks and full audit
trail capabilities.
"The Next Level of Computer Aided Audit Tools," AccountingWeb, August 15,
2005 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=101205
"Accounting Today Lists Top 100 Technology Products for 2005," SmartPros,
December 28, 2004 --- http://www.smartpros.com/x46317.xml
The December edition of Accounting Today,
a Thomson Media publication, published its 12th annual Top 100
Technology Products in the accounting profession, listing the best
and most proven applications in 17 categories.
All products listed offer users tools
they need to resolve both minor inconveniences and larger problems
that could threaten the health and lifeline of their businesses.
Products included on this year's roster
have been listed in the following categories: High-End and
Mid-Market Accounting; Small Business Accounting; Client Write-Up;
Customer Relationship Management; Enterprise Resource Planning;
Financial Planning; Fixed Assets; Forms; Non-Profits; Payroll;
Planning and Analysis; Practice Management; Tax Planning and
Preparation; Tax Research; and Trial Balance.
This year, two new categories -- Internet
Suites and Document Management -- have been added, and the Tax
Planning and Preparation categories have been combined to better
reflect the availability and range of products.
"We feel our 2005 ranking truly
represents the broad scope of technology solutions available
within the accounting profession," said Bill Carlino,
editor-in-chief of Accounting Today. "While some may
be quite familiar to practitioners, others have begun to establish
a high-profile presence within technology circles."
Each year, products are evaluated by the
magazine's editorial staff and judged by their quality,
practitioner acceptance, market visibility, product performance,
vendor support and product innovation, measured against
marketplace needs.
The 2005 Top 100 Technology Product
listing is also available on Accounting Today's sister
Web site, www.webcpa.com.
FOUNDATION Construction Accounting Software Wins Award
FOUNDATION Software received the award as the
software supplier for Lighthouse Electric, a two-time winner of the
prestigious Silver Vision Award in the subcontractor category. Lighthouse
earned its second Vision Award for innovative labor management plan that
promises to save over $100,000 in labor costs each year. By using the
features of FOUNDATION, as well as those form Congistics ControlBoard, a
tracking and scheduling application, Lighthouse was able to create a
separate function for the management of manpower that utilizes a single
powerful Microsoft SQL database. “Our challenge was to utilize technology
and procedures in a way that would easily disburse and control our biggest
cost: labor,” Ron Felix, CIO of Lighthouse Electric said in explaining how
technology and business came together for his company.
"FOUNDATION Construction Accounting Software Wins Award," AccountingWeb,
September 6, 2005 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=101265
"Award-Winning Accounting Software for Small Businesses," AccountingWeb,
July 22, 2005 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=101123
Sage Software produces two of the top
accounting solutions for small businesses, not just according to
accountants but also according to the technology crowd. Simply
Accounting and Peachtree, two of Sage Software’s accounting solutions
have won honors and awards from the media recently. Peachtree Premium
Accounting 2005 was awarded five of five stars and Simply Accounting
received four-and-a-half of five stars in CPA Technology Advisor’s
listing of Small Business Accounting Software for 2005. The evaluation
looked at six categories:
Basic Functionality/Ease-of-Use
Available Modules/Customization for Vertical
Industries
Expandability
Reporting and Management Functions
Audit Trail, Integrity and Accountant Control
Tools and
Help and Support Options. Peachtree Premium
received five stars in five categories to earn its five star overall
rating. The only category it did not earn five stars in was Help and
Support, where its well-built help utility, online Peachtree Knowledge
Center, additional support features and several optional support plans
merited only four-and-a-half stars.
Simply Accounting received four-and-a-half
stars in five categories. More than 100 customizable predefined reports
which can be integrated with both MS Word and Excel as well as a version
of Crystal Reports allowing for custom report creation and combine it
with the Daily Business Manager, payroll support functions and inventory
management earned Simply Accounting it’s only five star rating in
Reporting and Management Functions.
Simply Accounting has also been honored with a
2005 World Class Award for small business accounting from PC World. It
is the third consecutive year Simply Accounting has earned this honor.
The World Class Awards honor products combining practical features with
innovation and that reflect the rapidly changing technology marketplace.
PC World’s editors pick winners for their exemplary design, usability,
features, performance, innovation and price.
“The ultimate buyers guide, World Class Awards
set the standard for excellence in the high-tech and consumer
electronics industries,” states PC World editor-in-chief Harry
McCracken. “From desktop publishers to travel routers to satellite radio
and video instant messenger services, the editors reward the finest
products and most outstanding performers in this annual award program.
Congratulations to Simply Accounting.”
Peachtree is Sage Software’s primary brand for
small business accounting in the U.S. Simply Accounting is the
bestselling small business accounting product in Canada.
"Companies Offer Tech Solutions For Complex Finance Problems
," AccountingWEB, May 9, 2005 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=100875
Software makers are coming up with new ways for
companies to manage vast amounts of financial data. From the complexities of
complying with the Sarbanes-Oxley corporate reform law to the everyday tasks
involved with financial reporting, new products are being offered to help
companies do the work more efficiently.
Here is a sampling:
Applix, Inc. – The software maker announced Tuesday
that it has upgraded its TM1 suite so that users can do more sophisticated
financial reporting and consolidations. Wizards have been added so that
financial data can be imported more quickly from general ledger, accounting
and legacy systems into Business Performance Management applications.
A new offering is TM1 Financial Consolidations,
which supports journal entries, inter-company eliminations and other
activities specific to the consolidation process.
“Good financial planning begins with the actuals,
is followed by a planning process and ends with a comparison of the
subsequent actual results to the plan,” said David Menninger, Applix vice
president, worldwide marketing and product management, in a statement. “The
ability to access information from multiple sources, present it in an
easy-to-use, familiar environment and act upon it for everything from
reporting to planning to forecasting enables companies to reduce cycle
times, increase competitiveness and have greater trust in the information.”
The improvements are available for beta use now.
Contact Brian Barnes at bbarnes@applix.com
Movaris - The company, which provides Financial
Control Management software, has developed Certainty 8.1 to allow companies
to manage reorganizations, mergers and acquisitions, and personnel changes
as they affect the financial control environment.
Certainty 8.1 can change the users who are assigned
to hundreds of financial control tests, which improves corporate security.
It can update multiple financial control attributes. It allows for
comparisons of control activities at different points in time. “With
visibility into changes in the control environment over time, managers
identify improvements and the impact of change on their business unit, and
auditors identify the controls in place at the time an issue or exception
occurred,” the company said.
Stan Tims, vice president of marketing and business
development at Movaris, said in a statement that companies will need to
consolidate time-consuming tasks to comply with Sarbanes-Oxley in a
cost-effective way.
"Key technologies can reduce the cost of SOX
compliance upwards of 25 percent, as compliance has been a mostly manual,
people-intensive process. Most companies cannot (and should not) maintain
this level of manpower, though the need for compliance will not shrink,"
said John Hagerty, analyst for AMR Research in a January 2005 report, SOX
Decisions for 2005: Step Up Technology Investments.
- Continued in the article
-
Great Comparisons of Tax Software
"Tax Software Makes the Grade, by Stanley Zarowin, Journal of
Accountancy, September 2005, pp. 48-60 ---
http://www.aicpa.org/pubs/jofa/sep2005/zarowin.htm
-
- When asked to rate their overall satisfaction
with the 13 tax software products in the survey this year, the 3,156
AICPA Tax Section members who responded to the survey came up with a
combined average score of 4.23 (out of a perfect 5.00), a significant
gain from last year’s 4.03. In addition to the eight packages rated last
year, three new products received the minimum required 10 responses from
our CPA respondents. (For details about all the vendors in the survey,
see exhibit 1; for a complete scorecard on the satisfaction grades, see
exhibit 2; and for technical details about the products, see exhibit 6.)
Tied for first place in the
overall-satisfaction category, with ratings of 4.46, were Intuit’s
highly popular Lacerte and the much smaller Dunphy System’s Tax Software
for the Professional. Lacerte inched up from last year’s 4.32 rating;
since Dunphy was not in last year’s survey, it has no year-ago rating.
Tied for second place with 4.44 were Drake Software and Taxware System’s
Taxware Tax Preparation; both are new to the survey this year.
Continued in detail in the article
September 7, 2005 reply from Kurt Wilner
Dear Professor Jensen, I feel kinda cheated
that your post didn't look beyond the 'big boys' surveyed by the
AICPA. In my case, I jumped from Lacerte the year after Intuit
bought it -- and jacked its fees up majorly -- to ATX, which seems
to serve a huge base of "small practices" such as my own. ATX makes
the grade in 'The CPA Journal" and other mags; so I wonder why it's
neglected by your own cite -- which, in general, I prize for its
independence from commercial trends. Could you comment further upon
this, please?
Sincerely yours,
Kurt Wilner
On July 11, 2005 Barbara Scofield clued me into IDEA Software
described at
http://www.generalideasinc.com/cc_solutions.asp
NextNet 5.0 for New Product Development
NextNet 5.0 enables you to find the best ideas for new products,
fast. By expanding your reach, streamlining evaluation,
prioritization, and selection, the best product ideas and
enhancements rise to top of the heap. NextNet brings predictability
and profitability to the so-called 'fuzzy front end' of product
development. NextNet has been used by product development teams in
major corporations to rapidly discover and develop multi-million
dollar market opportunities.
(Click Here)
SaveNet 5.0 for Process Improvement
SaveNet 5.0 is the tried and true solution to make your operation
more efficient. SaveNet enables you to eliminate waste, improve
yields and streamline processes all with little or no addtional
management time. SaveNet is also a powerful motivator of employee
morale and team spirit in the workplace. SaveNet has been used by
major corporations to continously discover hundreds of thousands of
dollars in cost-savings.
Custom Innovation Management Solutions
The General Ideas Innovation Pipleline Management (IPM) Platform is
a highly versatile software platform that can be configured and
customized for specialized applications of Idea Management. General
Ideas employs the full flexibility of the IPM platform, configuring
workflows, alerts, data capture forms, permissions and metrics to
ensure effective Innovation Management. General Ideas has worked
with companies to create custom Idea Management solutions for:
Intellectual Property, IT Portfolio Management, Six Sigma, Employee
Suggestions, Total Quality Management, Corporate Strategy, Marketing
and Business Development.
July 13, 2005 reply from Bonnie Morris, West Virginia University
[bmorris@WVU.EDU]
Contact Audimation Services 888 641 2800
info@audimation.com
They have IDEA 2004 Workbook. It has 3
datasets and exercises (AR, AP and Fraud Investigation, and
Inventory Analysis)
Accounting Software
EmeraldKey Technologies, Inc. introduced
Envision Accounting Software for accounting and financial
professionals last week. Envision Accounting Software provides a
comprehensive solution to meet all business management needs,
including financial accounting, project management, client
management, time and expenses, billing, payroll, budgets/forecasts,
real-time reporting and Web-enablement.
"Introducing Envision Accounting Software for Accounting & Financial
Professionals," AccountingWeb, August 24, 2005 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=101233
Accounting Professional Site Links
The CPA Team http://www.cpateam.com/
Freeware Guide for Business and Finance ---
http://www.freeware-guide.com/dir/business/finance.html
Tax Software
- AccountingWEB's Software Resource Center --- http://www.accountingweb.com/item/52249
- Software Search Here www.findaccountingsoftware.com
Accounting Software Library http://www.excelco.com/tal.htm
- New stuff --- http://www.electronicaccountant.com/
- Old Stuff --- Jensen & Sandlin Survey of U.S.
Accountancy Education Programs
- Bruce Hutton CGA -
Accounting: Software, Publications and Bookkeeping Software
- The Software Review Source (Add Your Own
Review)
- AccountingNet is the
complete online resource for accounting professionals: Accounting
- Beginning WebCT (Creation of Web Pages)
- Accounting Related
Resources
- Accounting Library FREE DEMO and FTP Page
- Accounting Systems -- Accounting System
Locator / Selector
-
AuditNet: Internet Resources for Auditors
- Excelco / SouthWare Main Page
- Peachtree Software Home Page
- Home Page for MicroMash
- archipelago productions (Distributed
Learning Courses)
- TAL Standard Edition "Quick
LOOK" AIA Accounting Information Systems
- Spreadsheets in
Education
-
NPO
= Not-for-Profit
"Sizing
Up NPO Software," Roberta Ann Jones, Journal of Accountancy,
November 2000, pp. 28-44 --- http://www.aicpa.org/pubs/jofa/nov2000/jones.htm
"Using Software to Sniff Out Fraud," Amey Stone, Business
Week, September 30, 2004 --- http://www.businessweek.com/technology/content/sep2003/tc20030930_2727_tc131.htm
The Journal of Accountancy ran an article showing how a
Benford's Law application in Excel led to discovery of a fraud.
"Turn Excel Into a Financial Sleuth," by Anna M. Rose
and Jacob M. Rose, The Journal of Accountancy, August 2003
--- http://www.aicpa.org/pubs/jofa/aug2003/rose.htm
Bob Jensen's threads on accounting software are at http://faculty.trinity.edu/rjensen/bookbob1.htm#software
Technology sites from Smart Stops on the Web, Journal of Accountancy,
June 2005 ---
http://www.aicpa.org/pubs/jofa/jun2005/news_web.htm
Check Out
Check 21
www.aicpa.org/financialliteracy
The AICPA Financial
Literacy Resource Center has added a
section to its Web site about the Check
Clearing for the 21st Century Act (Check
21). The Web site discusses the act’s
implications for auditors and
businesses, and provides links to the
Federal Reserve Board’s “Check Clearing
for the 21st Century Act” Web page and
implementation information, two
frequently-asked-questions sections and
a consumer guide.
A Site
With Byte
www.freebyte.com
CPAs and IT managers
will want to bookmark this Smart Stop
loaded with links to free accounting,
antispam and backup software, currency
and document converters, mortgage
calculators, computing and financial
glossaries and Web browsers. There are
online dictionaries in English as well
as French, German, Italian and Spanish.
There’s also free clipart, fonts and
photos that CPAs can use for marketing
brochures, and everyone can take a break
in the Jokes and Humor and Free Games
sections.
Figure for
Free
www.calculator.com
Sure, you already have
mortgage, percentage, scientific and
standard e-calculators. This site offers
calculators for car leases, fractions,
graphing, and home equity and general
loans, plus converters for currency,
international time, temperature and
units of measure. There’s also a link to
the tax-preparation-service calculator
site www.internet-taxprep.com with tools
CPAs can use to calculate investments,
mortgage refinancing and Roth IRA
returns for clients. Other resources
include current and archived tax news, a
2005 tax guide and information about a
free online tax-filing program.
Tech Talk
www.itmweb.com
CITPs and other
information technology professionals can
find resources here on IT capital
spending, department budgets and salary
ranges. Download the demo software, read
book reviews or subscribe to the free
monthly IT e-zine and newsletter.
Technology Articles has tips on making
your e-mails sound more professional and
improving your project team management
skills, while the Job Listing Centers
invite employers to post open positions.
IT White Paper Spotlight offers
documents on subjects from artificial
intelligence to knowledge management.
Painless
Projects
www.ittoolkit.com
Looking for more
efficient ways to manage IT procedures
and roll out new technology? Then
register for a free membership at this
e-stop to access information on managing
IT operations and receive a monthly
e-mail reporting on the latest task
management resources. Members can
download planning checklists, mission
and scope statement templates and white
papers on IT process improvements. |
|
Bob Jensen's technology bookmarks are at
http://faculty.trinity.edu/rjensen/bookbob4.htm
Information Technology Sites, From Smart Stops on the Web, Journal of
Accountancy, May 2004, Page 23 --- http://www.aicpa.org/pubs/jofa/may2004/news_web.htm
THE
INTERNET |
SMART
STOPS ON THE WEB |
For IT Educators
and Leaders
www.techlearning.com
Here, CPAs who specialize in
IT professional development can find helpful
resources such as tips on needs assessment for
offices or classrooms and articles including
“Data Can Drive Development.” Users also
can read software reviews and find links to
general search engines as well as to an
encyclopedia with more than 20,000 IT terms.
Free Online
Resources
www.eweek.com
CPA IT professionals can
register for free at this Web stop and enroll
in gratis e-seminars on topics such as best
practices for enterprise data integration,
information security and wireless LAN
deployment. Users seeking to advise clients on
application storage management systems will
want to give them the quick quiz “Do You
Need to Automate?” before proceeding.
Read to Keep Up
www.technologyreview.com
In addition to providing free
either two hard copies of the magazine or a
digital issue, Technology Review offers
visitors to its Web site a free subscription
to the newsletter Technology Review Update.
Other gratis offerings include the sections
Predictive Markets, where users can predict
future outcomes of IT issues to win prizes,
and Research News, which has links to
information on industry innovations.
Less Search
Time, More Results
www.keepmedia.com
CPAs looking for IT articles
from the past 12 years can register here for a
free seven-day trial. Users can search more
than 150 publications, store favorite articles
directly online at this site, keep track of
what they’ve looked at—saved or not—and
let KeepMedia find other articles based on
their previous choices. A general search on
the word technology returned more
than 14,000 results.
Telecommuting
Technology
www.langhoff.com
CPAs working from home or
remote locations can find case studies and
statistics on this trend through the
frequently-asked-questions section at June
Langhoff’s Telecommuting Resource Center.
Also, visitors can look through the business
travelers’ survival guide to find tips and
links to airlines, ATM locations and business
services for mobile users. Companies
interested in starting a work-at-home program
can research the costs and get links to model
telecommuting agreements and policies.
“The Silly Con
Valley Report”
www.mikeslist.com
Don’t be fooled by this Web
site’s light tone: Useful nuggets of
information, including the latest reports on
software designs, how to thwart spam and a
300-Gb hard drive, can be found beneath all
the humor. Also, users can read up on the
latest in broadband and handheld technology
and Windows XP through the newsfeed links as
well as join up for a free weekly
e-newsletter. |
|
- Bob Jensen's Links to Accounting Software and Vendors
(this list is outdated!)
- XBRL Updates --- http://faculty.trinity.edu/rjensen/XBRLandOLAP.htm#TimelineXBRL
Accounting Related
Resources
- AccountingNet is the
complete online resource for accounting professionals: Accounting
- Accounting and Financial Information
- BUSINESS RESOURCES
- Accounting Net - Your Internet Link to
the Accounting World
-
CPA Online: Your source for Accounting
Information on the Internet
- Bob Jensen's Vendor Database
(this list is outdated!)
- Course Resources
- CyberCpa - Resources
- Jensen & Sandlin Survey of Accountancy Education Programs
(Outdated)
- Jensen & Sandlin Survey of Commerical Learning Materials in
Accounting (Outdated)
- K2 Enterprises Accountants Hotlist
- Site Seeker
- Home Page for MicroMash
-
Accounting Software ---
https://en.wikipedia.org/wiki/Accounting_software
2018: Best Inventory Management Software with
Accounting ---
https://www.accountingweb.com/community/blogs/stevenhgallagher/best-inventory-management-software-with-accounting?source=ei081518
Enter "cloud software" AND "accounting at
https://www.google.com/advanced_search
Enter "cloud software" AND "accounting at
https://www.bing.com/
Cloud-Based Accounting Software
---
https://softwareconnect.com/lp/36104306106/?k=%2Bcloud%20%2Baccounting%20%2Bsoftware&mt=b&p=1t2&n=g&cp=1493178641&g=57927740776&ac=285345733657&ae=&tg=kwd-19493024904&geo=9002382&dt=c&dm=&cs=&gclid=EAIaIQobChMI05Dp5-Dv3AIVwrXACh0pTw-EEAAYAiAAEgLstvD_BwE
July 2014
The CFO Guide to Budgeting Software: 10 Key Elements Companies Should Look
For ---
Click Here
http://pages.cfo.com/Centage---Budgeting-Software_download.html?mkt_tok=3RkMMJWWfF9wsRojuqnAZKXonjHpfsXx6%2B4rW6Cg38431UFwdcjKPmjr1YcHScd0aPyQAgobGp5I5FENTrDYUKhrt6EPWQ%3D%3D
From the CPA Newsletter on
September 4, 2014
CPA practitioners rate their tax preparation software
http://r.smartbrief.com/resp/gbwLBYbWhBCJdbmnCidKtxCicNZefG?format=standard
Likes, dislikes, technical support and more -- CPA tax practitioners
once again this year share their assessments of the leading programs
for preparing and filing tax returns on behalf of clients. Extensive
tables and analysis give users' responses for eight products. A link
from the article provides free online access to still more detailed
results and information.
Journal of Accountancy print issue
(9/2014)
Bob Jensen's
neglected threads on accounting and tax software ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#SoftwareAccounting
Worldwide Directory of Accountants and Consultants ---
http://www.searchsystems.net/list.php?nid=62
Bob Jensen's helpers on how choosing professional advice ---
http://faculty.trinity.edu/rjensen/fees.htm
Information Systems Audit and Control Association and Foundation
Web (ISACA) site --- http://www.isaca.org/
Electronic Commerce: http://faculty.trinity.edu/rjensen/ecommerce.htm
Assurance Services: http://faculty.trinity.edu/rjensen/ecommerce/assurance.htm
-
- How CPAs Rated Their Tax Software ---
http://www.journalofaccountancy.com/issues/2016/aug/2016-tax-software-survey.html?utm_source=mnl:cpald&utm_medium=email&utm_campaign=01Aug2016
Find Accounting Software (commercial site) ---
http://findaccountingsoftware.com/
Audit Analytics ---
http://www.auditanalytics.com/0002/
A Premium Audit Industry Market Intelligence
Service Audit Analytics has information on over 20,000 public
registrants and over 1,500 audit firms. It is the most comprehensive
market intelligence tool for the audit industry available today.
AuditAnalytics.com currently offers over 60 data fields to its users.
Access to this data is available as on-line user subscriptions, as
enterprise data feed subscriptions, and in custom reports.
Huron is the
main source of restatement statistics ---
http://www.huronconsultinggroup.com/
Gerald Trite's great set of
links ---
http://iago.stfx.ca/people/gtrites/Docs/bookmark.htm
Online Magazine (for Information Professionals) ---
http://www.onlineinc.com/onlinemag/index.html
ONLINE is written for Information
Professionals and provides articles, product reviews, case studies,
evaluation, and informed opinion about selecting, using, and managing
electronic information products, plus industry and professional
information about online database systems, CD-ROM, and the Internet.
This site contains selected full-text articles and news from each
issue of the magazine. Direct letters to the editor to Marydee Ojala
(
Marydee@xmission.com ). If you are interested in writing for
ONLINE, please see the Authors' Guidelines.
-
-
-
Links to Journals on
Artificial Intelligence
American Accounting
Association Special Interest Group
Brown and O'Leary
Tutorial
Gal and Steinbart
Bibliography of AI
Literature (With Updates)
A. B. I. S. A. (index)
Finance and Investment Links
(Neural Networks)
WebBots
MultiLogic (EXSYS Expert Systems Software)
- Accounting Professional Site
Links
The CPA Team
http://www.cpateam.com/
Electronic Commerce ---
http://faculty.trinity.edu/rjensen/ecommerce.htm
Assurance Serivices ---
http://faculty.trinity.edu/rjensen/ecommerce/assurance.htm
(Including SysTrust, WebTrust, Truste, BBB, etc.)
- For Eldercare
Information
www.elderweb.com
Impact of
Technology
New Opportunities
Megatrends
Range of
Services
Site Map
AICPA Discussion Forum
AICPA Feedback
PC Meter Tackles Web
Measurement (Accounitng Assurance Services)
CPA
WebTrust Slides
Computer Security Issues
Introduction to Internet Security
AICPA CPE Course
The Capability Maturity Model (CMM) For
Software
Deloitte & Touche Risk Management
& Control: Visual Assurance
-
"The Business of Bankruptcy:
CPAs can't make a bad economy go away, but they can provide value to clients on
the ropes," y Victoria Zunitch and Michael Hayes, Journal of Accountancy,
February 2002, pp. 35-39 ---
http://www.aicpa.org/pubs/jofa/feb2002/zunitch.htm
EXECUTIVE
SUMMARY |
A
CPA FIRM WITH A CLIENT filing for bankruptcy has
a responsibility to serve the client as well as an
opportunity to compete for some of the work on the
case—and through it develop a specialty. The need for
bankruptcy services is expected to grow for a while.
CPAs
SOMETIMES ARE THRUST into the field when a client
goes broke, but a firm that has time to plan can develop
the niche strategically. The bulk of bankruptcy work comes
from attorney referrals.
A PERUSAL
OF THE PUBLIC RECORDS of your local bankruptcy
court and the U.S. Trustee Office will identify the
accountants, lawyers, trustees, examiners and other
advisers who are players in your market.
THE
EXACTING BILLING requirements of the court affect
every novice in bankruptcy work and are a continual
challenge even for seasoned practitioners. CPAs are at
minimum risk because the court’s first administrative
priority is to cover the expenses of a bankruptcy.
DURING A
BANKRUPTCY, debtors, creditors’ committees,
trustees and other entities need CPA services. A firm
should look first for clients that need services it
already provides, such as tax preparation or monthly
reports.
CONFLICT-OF-INTEREST
CONSIDERATIONS usually require the work to be
parceled out to several accounting firms, which means
attorneys are always looking for new CPAs with whom to
work. |
VICTORIA
M. ZUNITCH is a freelance business writer based in New
York. Her e-mail address is
VZwriter@hotmail.com
MICHAEL HAYES is a senior editor on the JofA. Ms.
Hayes is an employee of the AICPA and her views, as
expressed in this article, do not necessarily reflect the
views of the Institute. Official positions are determined
through certain specific committee procedures, due process
and deliberation. |
From Smart Stops on the Web, Journal of Accountancy,
February 2002, Page 25 ---
http://www.aicpa.org/pubs/jofa/feb2002/news_web.htm
Intro to
Bankruptcy Law
www.bankruptcylawinstitute.com
This site offers information on Chapter
7, Chapter 11 and Chapter 13 bankruptcy law, forms and court
filing procedures. Users can access online tutorials on the
following topics: types of bankruptcy, the structure of bankruptcy
law, exemption and property law, and how to calculate equity.
Bankruptcy-Law
Links
www.agin.com/lawfind
The law firm Swiggart & Agin, LLC, in
Boston hosts the Bankruptcy Lawfinder, offering users related
information and resources. Site sections include courts and cases,
regulations and statutes. The bankruptcy law resources section
includes links to the American Bankruptcy Institute, a directory
of companies in Chapter 11 proceedings and the Center for Debt
Management.
Peachtree Accounting has a short new name and huge new prices
"Sticker Shock Awaits Sage 50/Peachtree Payroll Service Users,"
by David Ringstrom, AccountingWeb, April 16, 2013 ---
http://www.accountingweb.com/article/sticker-shock-awaits-sage-50peachtree-payroll-service-users/221587?source=technology
The 2014 version of Sage 50, formerly
known as Peachtree Accounting, is available for purchase now. As
a result, certain users who rely on the payroll subscription are
going to experience sticker shock in the near future.
Historically, you could purchase a Sage 50/Peachtree Accounting
product and pay an additional fee for the annual payroll service
that makes it easy to calculate withholding taxes. As long as
your accounting software was one of the three most recent
versions, the annual payroll service typically cost around
$300/year. Such users are about to see their annual costs
increase by a factor of two, three, or even more.
For several years, Sage has offered an
optional Business Care program that entitled users to priority
support and automatic program upgrades. This program is now
mandatory if you want to process payroll in the software. The
Sage Business Care program is being offered at three levels:
Silver Gold Platinum
The Silver plan offers unlimited
support, annual product upgrades, and the Business Intelligence
feature that allows you to analyze your accounting data in
Microsoft Excel. However, if you wish to process payroll within
Sage 50, you must sign up for the Gold or Platinum programs. The
Gold program allows you to process payroll for up to fifty
users, while the Platinum program offers unlimited payroll as
well as priority access to a dedicated support team that offers
appointment scheduling.
Business Care is an annual
subscription, which means that rather than buying the software
and sitting out a couple of upgrade cycles, you must continue
your Business Care subscription year after year in order to
process payroll in Sage 50.
Sage doesn't disclose pricing for the
Gold or Platinum programs on its website, because the pricing
varies based on which version of Peachtree/Sage 50 you're
currently using and the number of simultaneous users you
require. In general, the first year of business care will be at
a higher price, with savings each year for annual consecutive
renewals. As a point of reference, a Silver Business Care
subscription for a three-user license for Peachtree Complete
Accounting is $669/year. This doesn't include payroll, so it
means your ongoing annual expense will likely be at least
$800/year, year-in, year-out, as opposed to the $300 or so that
you could formerly pay to add a payroll subscription.
Continued in article
There is a somewhat useful 2011 Peachtree versus Quickbooks site at
http://blog.softwareadvice.com/articles/accounting/peachtree-vs-quickbooks-1062211/
Pricing comparisons before April 2013 are probably out of date.
Helping Community College Graduates Find Careers
The Community-College Employer Connection ---
https://www.brookings.edu/podcast-episode/the-community-college-employer-connection
Bob Jensen's Threads on Professional Practice,
Fees, Choosing Accountants, Financial Advisors, and Consultants ---
http://faculty.trinity.edu/rjensen/fees.htm
www.legal-definitions.com
CPAs who need help deciphering “lawyerspeak” can
find concise definitions of legal terminology at this e-stop as well
as the meaning of general business terms such as bankruptcy.
www.commerce-database.com
Need to know the difference between an act of
God and an act of nature? The legal terms section of
this online business dictionary defines them as one and the same.
The Commerce Database categorizes words into separate business and
legal dictionaries: The business one offers categories such as
accounting.
www.legal-database.com
CPAs interested in legal topics such as bankruptcy,
civil rights, employment, labor and tax laws can find various terms
explained in the articles section for each category at this Web
stop. In addition visitors can register for free monthly newsletters
on bankruptcy, employment, family and tax law.
See also
Small Business Helpers
Fees and Professionalism
Message from FERF on February 24, 2004
Auditor
Fees
An FEI
member recently asked research as to whether a database exists
of how much audit firms charge in audit fees relative to size of
clients and billable rates per hour.
FERF
researchers found information broken down by company size in the
recent FEI Sarbanes-Oxley Section 404 survey results issued
earlier in February
http://www.fei.org/news/404_survey.cfm.
Although billable rates are not given, an excel table details
incremental audit fees for the Section 404 attestation and the %
increase this fee represents of their current audit fee. Various
groupings of responses are given by size of company based on
revenue.
In
April 2003, FEI's Committee on Corporate Reporting (CCR)
surveyed its members on 2002 audit fees. Twenty-five companies
with total US assets of between $0.4 billion and $1,097 billion
responded. Findings and an excel table are available under
Finance Tools at
http://www.fei.org/financetools/audit_fee.cfm
Aspen
Publishing recently released the 5th edition of
"Professionals Guide to Value Pricing." The book
discusse related value pricing vs. audit firm hourly rates. A
description of the book can be found at:
http://www.aspenpublishers.com/Product.asp?catalog%5Fname=Aspen&category%5Fname=&product%5Fid=0735543178&Mode=SEARCH&ProductType=M.
Bob Jensen's guides to fees and related matters
are at http://faculty.trinity.edu/rjensen/fees.htm
-
Services Offered by Professional
Accounting Firms (including how to find them) ---
http://faculty.trinity.edu/rjensen/fees.htm#ServicesOffered
From Smart Stops on the Web, Journal of Accountancy, July 2007 ---
http://www.aicpa.org/pubs/jofa/jul2007/news_web.htm
WEALTH MANAGEMENT |
|
SECURING A REPUTABLE BROKER
www.nasd.com/brokercheck
The NASD has answered the calls of investors looking for
background information on potential financial service
providers. The organization’s BrokerCheck Program lets
users research current or formerly registered securities
firms, individual brokers and regulated Investment
Adviser firms. It also provides a comprehensive 10-year
business and licensure history and list of disclosure
events, including criminal actions, customer complaints
and disciplinary actions by regulators against the firm
or broker. Investors receive an electronic disclosure
report as well as access to other educational services,
including the Professional Designation Database and
state disclosure programs.
BECAUSE YOU’RE WORTH…MORE
www.freemoneyfinance.com
Whether you’re living on a student’s budget or a CFO’s
salary, Free Money Finance has innovative ideas for
increasing net worth, budgeting and maximizing
retirement savings that you can immediately put into
practice. On Mondays, check out “Star Money Articles,” a
posting of news and tips from several of the Web’s
popular personal finance sites. Take a few minutes on
Fridays to read “One Year Ago,” popular posts from the
prior year, to jump-start a frugal weekend.
THE
BENEFITS OF TAX KNOWLEDGE
www.irs.gov/retirement
Visit this Smart Stop for the
latest tax news and information affecting the employee
plans community. CPAs can search for resources on
employee plans (EP) examinations and enforcement,
retirement plans, benefit audits and correcting EP
errors. Click on the “EP/Forms/Pubs/Products” link for
access to PDF versions of EP forms and publications,
plus in-depth instructions for form 5500, Annual
Return/Report of Employee Benefit Plan, and form
5330, Return of Excise Taxes Related to Employee
Benefit Plans.
NOTHING IS
CERTAIN BUT…
www.deathandtaxesblog.com
Visit Chicago-area attorney Joel
Schoenmeyer’s Web site to brush up on topics straddling
the lines between law, accounting and wealth management.
Death and Taxes—The Blog offers estate planning and
administration news and commentary, plus coverage of
legal issues about real estate, gift and income taxes,
trusts and charitable giving. |
Bob Jensen's investment helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#Markets
Audit Analytics
---
http://www.auditanalytics.com/0002/
A Premium Audit Industry Market
Intelligence Service Audit Analytics has information on over 20,000
public registrants and over 1,500 audit firms. It is the most
comprehensive market intelligence tool for the audit industry
available today. AuditAnalytics.com currently offers over 60 data
fields to its users. Access to this data is available as on-line
user subscriptions, as enterprise data feed subscriptions, and in
custom reports.
The FBI's Internet Fraud and Complaint
Center (IFCC FBI)
To thwart fraud on the Internet and terror in general, check in
and/or report to
http://www1.ifccfbi.gov/index.asp
- Bob Jensen's Threads on Accounting
Fraud ---
http://faculty.trinity.edu/rjensen/fraud.htm
Message from FERF on February 24, 2004
Fraud
Checklists
Another
FEI member responsible for a Sarbanes-Oxley 404 engagement
recently inquired about a "checklist that can be used at
the process level to help identify the types of fraud concerns
related to a specific process."
FERF
researchers found the following references:
An
Appendix to Statement on Auditing Standards No. 99,
Consideration of Fraud in a Financial Statement Audit (SAS 99),
provides examples of fraud risk factors. The appendix is
available at the AICPA website at:
http://www.aicpa.org/antifraud/business_industry_govt/assessing_organization_vulnerability/identify_assess_risk/38.htm
The
Association of Certified Fraud Examiners provides a fraud
prevention checkup that can be used to assist in determining an
"entity's vulnerability to fraud."
http://www.cfenet.com/pdfs/FrdPrevCheckUp.pdf
In
January 2003, the Institute of Internal Auditors conducted a
survey on red flags used to detect fraud. Though the survey is
closed, the text can be used as a checklist.
http://www.gain2.org/redflags.htm
Somewhat
related to the issue of fraud, Mutual Interest published an
article about SAS 99 and fraud:
http://www.auditnet.org/articles/SAS%2099%20Friend%20or%20Foe.PDF
FERF
also wrote an article on fraud detection that will be published
in the March/April 2004 issue of FE Magazine that will soon be
available at
http://www.fei.org/mag/.
Bob Jensen's main fraud links are at
http://faculty.trinity.edu/rjensen/fraud.htm
-
Services Offered by Professional
Accounting Firms (including how to find them) ---
http://faculty.trinity.edu/rjensen/fees.htm#ServicesOffered
-
-
A great listing of URLs of companies selling
accounting systems software.
http://www.lib.polyu.edu.hk/electdb/DATAPRO/154-1.htm
Bob Jensen's AIS course ---
http://faculty.trinity.edu/rjensen/acct5342/acct5342.htm
SQL Ledger ---
http://www.sql-ledger.org/
other
-
-
Application Development Trends
SAP Homepage (Accounting Information Systems)
Microsoft Access Accounting Systems
-
Application Development Trends
(Information Systems, Databases)
ACCT 5342 Accounting Inrformation Systems
(Includes ACCESS links)
-
QueryTool (Databases, ODBC)
-
SnmpQL SQL Examples
-
Index of
/~jbarlow/dbclass/fall.95/ SQL examples/
-
InterBase SQL GROUP
BY
-
CS 265 - SQL
Examples MS Assexx
-
Technical Glossary
@IceNH
-
Microsoft Access
Health Care Solutions
-
A Metalanguage for
Describing Internet Resources
-
SAP R/3 Design Center [SAP]
PriceWaterhouse Coopers
-
DatatelHome Page
-
EDUCATIONSYSTEMS (SCT Education and Accounting
Information Systems)
-
CARSInformation Systems
-
PeopleSoft:Meet PeopleSoft
-
ASU
-
-
http://www.public.asu.edu/~cpaul/
-
Julie Smith David Homepage
-
ACC330: Accounting Information Systems at
Arizona State University
-
COURSE TECHNOLOGY
-
Joseph H. Callaghan, Thomas W. Lauer, and Eileen
Peacock
Oakland University's School of Business Administration
An AIS Curriculum Using a Model-Oriented, Tool-Enhanced (MOTE) Framework
See
http://www.rutgers.edu/Accounting/raw/aaa/facdev/teaching/submissions/callaghan.htm
The innovation consists of a curriculum, instructional strategy,
teaching approach, and a set of related teaching materials. Evidence of this
implemented innovation is composed of the following:
- An
Executive
Summary
- Several articles describing the innovation and its foundation
elements
- Attestations from academics, students, practitioners, and
employers
- Course syllabi for the three courses in the curriculum:
ACC 418/618, Computerized Accounting Information Systems
ACC 419/619, Accounting Information Systems: Design
ACC 480/680, Special Topics in Accounting Information Systems
- Examples of course materials used in the curriculum
- Data Modeling Case example Business Process Case example Sy's Fish
Case example PLACE Case
At its core, the MOTE approach aims to teach conceptual
understanding and skills in data and process modeling in an accounting context. Learning
these skills on a conceptual level is reinforced through the use of programmer development
software. These are software tools that support systems development from the model level
during systems analysis, through systems design, and to the completion of the development
life cycle and the construction of the system. The first two courses of our AIS curriculum
roughly follow these three phases, while the third course reiterates these phases in a
complex accounting context. For further information, see the
Executive
Summary for the innovation at
http://www.sba.oakland.edu/faculty/Callaghan/aisaward/AAA%20MOTE%20award.html
-
-
ACCT 5342 Accounting
Inrformation Systems
-
AAA IS/MAS Homepage
Study Web
-
http://www.isworld.org/isworld.html
-
Ernie. Your online business consultant.
-
Frank G. Duserick
(MIS and AIS Courses)
-
Darrell Walden at U.
of Richmond - Accounting Information Systems
-
Univeristy of
Waterloo - School of Accountancy - J.E. Boritz
-
AC3029 Accounting
Information Systems (AIS)
-
AAA IS/MAS Homepage
-
Ceil M. Pillsbury
-
AIS OnLine
-
EdWeb Home Page (Education, Recommended
by Ceil Pillsbury)
-
||-- webprofessor Amelia Baldwin at
Florida International University (Acccounting Information Systems)
-
Favorite Sites --
Accounting, AIS & MIS Students & Professionals
-
Here's Ernie
-
http://WWW.raptor.com/library/nstiss.glo.txt
-
Raptor Systems Security Library
-
SMAP 96 Homepage
-
The School of Information Systems
-
Infobyte Homepage
-
Infobyte Homepage (General Ledger,
Accounitng Education Site)
-
ISACA - Information Systems Audit and
Control Association (Accounting Information Systems)
-
Favorite Sites --
Accounting, AIS & MIS Students & Professionals (Shared Course Materials)
-
Favorite Sites --
Accounting, AIS & MIS Students & Professionals (Accounting and AIS Links)
-
Association for Information Systems
-
http://www.isworld.org/isworld.html
-
Datatel Home Page
-
Datatel : Products
(Microcosm Authoring Software)
-
Microsoft's COM
(Component Object Model)
-
InfobyteHomepage (Accounting, General Ledger Software)
-
AuditNet: Internet Resources for Auditors
-
Ernie. Your online business consultant.
-
AC3029Accounting
Systems
-
KenyonCollege - Academic Projects on the Kenyon Web
-
Chapters (Internet Guide for Accountants
by Kogan, Sudit, and Vasarhelyi)
The AIS/ICIS Placement Listings
-
OSU
-
-
AMIS Faculty Home
Pages
-
-
In the Classroom
-
-
Waleed Muhanna's
Home Page
-
Learning Insights (includes CFA paractice questions)
-
"Distance learning: The world of online training for
accountants," AccountingWeb, December 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=103948
From Smart Stops on the Web,
Journal of Accountancy, November 2007 ---
http://www.aicpa.org/pubs/jofa/nov2007/smart_stops.htm
CONTINUING EDUCATION |
|
THE CPA
TOOLBOX
www.cpemarket.com
This Smart Stop is part of the National Association of State Boards
of Accountancy’s
www.nasbatools.com, which offers “tools for accountancy
compliance.” CPAs can search CPE course providers, the National
Registry of CPE Sponsor courses and quality assurance service
courses, plus click on “Pilot Test CPE Courses” to try out courses
for free. There’s also access to instructor resumes and in-house
course providers. Click on the state you’re licensed in to find
updated information on mandated continuing education requirements
and links to your state’s board of accountancy.
CREDITS ON THE GO
www.cchpodcast.com/partners/cchPodcast
Check this site for free CPE podcasts, available as streaming audio
or downloadable to your computer or audio player. Click on “Course
Catalog” to download available podcasts and their supplementary PDFs,
including a study guide and final exam questions. When you’re ready
to take the exam, enroll and purchase the credits—your exam grading
and certification is available immediately. Be sure to check if your
state’s board of accountancy accepts these CCH self-study courses by
clicking the “CPE Accreditation” link.
ASSESS YOURSELF
www.cpa2biz.com/CPE
Just starting your continuing education requirements? Test your
skills and training needs with the site’s “Competency
Self-Assessment Tool,” free for AICPA members, then search CPE
courses by topic, level, job area or format, including CD-ROM and
DVD. Check back often to see the month’s top sellers and new
releases or to download catalogs for the “CPE Direct” program and
“Staff Training Series.”
THE ROAD TO CPE COMPLIANCE
www.cpetracking.com
Can’t keep up with your CPE hours? Launched in 2006, this site keeps
accounting professionals and firms up-to-date on CPE hours and
compliance. Registered users can record CPE credits, which are then
compared to the requirements from each state’s board of accountancy
and regulatory agencies. The service also provides status reports by
jurisdiction and reporting period, as well as access to all of your
CPE records in one location.
|
Most accountancy associations,
firms, and many colleges also offer CPE courses.
Bob Jensen's threads on online training and
education are at
http://faculty.trinity.edu/rjensen/Crossborder.htm
-
Richard
Torian's Managerial Accounting Information Center --- http://www.informationforaccountants.com/
O'Keefe Accounting Library Searches
http://library.sau.edu/bestinfo/Majors/Accnt/accindex.htm
Services Offered by Professional
Accounting Firms (including how to find them) ---
http://faculty.trinity.edu/rjensen/fees.htm#ServicesOffered
Bob Jensen's Threads on Accounting Fraud, Forensic
Accounting, Securities Fraud, and White Collar Crime --- http://faculty.trinity.edu/rjensen/fraud.htm
Bob Jensen's
Threads
on Fees and Choosing Accountants, Financial Advisors, and
Consultants ---
http://faculty.trinity.edu/rjensen/fees.htm
- Accounting Professional Site
Links
The CPA Team
http://www.cpateam.com/
-
- CPAnet
http://www.cpanet.com/index.asp
-
Accountants
Directory - Database Search
THE LIST of CPA Firms
Welcome to NACUBO!
- Gerald Trite's great
set of links ---
http://iago.stfx.ca/people/gtrites/Docs/bookmark.htm
-
- AccountingWEB's Entrepreneur to Accountant Referral Network
(E.A.R.N.) program, matching the accounting and financial
needs of thousands of small businesses with the talent of the
AccountingWEB community.
http://www.accountingweb.com/item/39161
-
- Bob Jensen's Links
- American Association of Hispanic Certified Public
Accountants --- http://www.aahcpa.org/
-
Jensen & Sandlin Survey of U.S.
Accountancy Education Programs
-
E. Barry Rice, Loyola College in Maryland
-
ANet Home Page
ANet Australia home (International Accounting Network)
-
Wm. Dennis Huber's
Web Page
-
RAW Rutgers
Accounting Web Introduction
Locate a Lawyer with lawyers.com!
Information Systems Audit and Control Association and
Foundation Web (ISACA) site ---
http://www.isaca.org/
Professor Durler has a nice links page at
http://www.emporia.edu/~durlerge/links.htm
Public Accounting Report
has published its annual ranking of America's Top 100 Accounting
Firms, and it's no surprise that Andersen, last year's number five
ranked firm, is no longer on the list.
http://www.accountingweb.com/item/95611
- PricewaterhouseCoopers:
$8,056.5 million
- Deloitte
& Touche: $6,130 million
- Ernst
& Young: $4,485 million
- KPMG:
$3,171 million
- Grant
Thornton: $432.5 million
- BDO
Seidman: $353 million
- BKD:
$210.9 million
- Crowe,
Chizek & Co.: $204.7 million
- McGladrey
& Pullen: $203 million
- Moss
Adams: $163 million
"Second Six: Ready to Step Up?" CFO.com ---
http://www.cfo.com/specialreport/0,5487,564||A,00.html
As contributing editor Ed Zwirn reveals
in his article ''The
Second Six: Ready to Step Up?'', the demise of Andersen
and the advent of Sarbanes-Oxley have not been an unqualified
blessing for those firms that remain. And in ''Same
Straw, Smaller Back,'' Zwirn notes how new regulatory
burdens that fall heavily on smaller companies (the usual Group
B clients) may persuade many of them to go private.
The American Bar
Association is Giving Something Away for Free
ABA LawInfo.org ---
http://www.abalawinfo.org/
Your gateway to information on legal
topics that affect your daily life.
From the Scout Report --- Business.com
http://www.business.com/
The owners of this lucrative URL
address have sponsored a Web directory created by a "team
of 50 research analysts [that] has sifted through the Web to
find relevant sites for our handcrafted Directory." All
Websites in this 30-category directory have been annotated. The
annotations, however, tend to be very terse and a bit vague.
First time users are encouraged to skim over the excellent site
guide, which gives a step-by-step manual for using the site as
well as in-depth explanations of the terminology and taxonomy.
-
The National Network
of Accountants homepage is at
http://www.nnaplan.com/
AAA
-
-
American Accounting
Association (AAA)
Accounting
Coursepage Exchange (ACE) - American Accounting Association (AAA)
Teaching and
Curriculum Section Home Page
-
Public Interest
Section of the AAA
-
AAA IS/MAS Homepage
Globalization Strategic Alliances
Roundtable (GSAR), Berlin, Germany, June 22, 2001 ---
http://www.cs.trinity.edu/~rjensen/GSAR2001/000start.htm
AICPA
-
- e-Commerce and e-Business Helpers for Accountants
---
http://faculty.trinity.edu/rjensen/ecommerce.htm
-
AICPA American Institute of Certified
Public Accountants
AICPA Journal of Accountancy
AICPA The Vision Process
-
AICPA AICPA Code of
Professional Conduct
-
AICPA NewsFlash! - 9/16/97 - AICPA
Launches CPA WebTrust Electronic Commerce Seal
-
AICPAAICPA
Implementation Initiatives on SAS No. 82
-
AICPARecently-Issued
Auditing Standards and Interpretations
-
AICPAOnline Policies and Copyright Information
-
AICPAHome Page
-
CPAtechonline: Tech News
(Accounting, Auditing, Tax, Computers, AIS)
-
PronouncementsHaving Current and Future Effective Dates
-
AICPA AICPA Online Audio/Video Library
-
EAA
-
-
European
Accounting Association Home Page
EAA 96 Complete
Index of papers
-
Index of EAA 96 by
Theme Reference - ATH
-
IASB (formerley
IASC)
-
-
IASB - Web Site
The IASB announced that international accounting IASC standards will now be available on
CD-ROM at http://www.iasc.org.uk/news/cen8_065.htm
.
IYou may also try
http://extranet.pw.com/PWRUpdates.htm
-
IOSCO Home Page
-
IFAC
IFAC - International
Federation of Accountants
The Internet and Distance Learning in Accounting EducationIFAC
International standards are also available along with accounting and auditing standards in
various nations are also available on the PriceWaterhouse Coopers
Compario at
http://www.pwcglobal.com/gx/eng/about/svcs/comperio/
FASB
-
FASB Home Page
International standards are also available along with accounting and auditing standards in
various nations are also available on the PriceWaterhouse Coopers
Compario at
http://www.pwcglobal.com/gx/eng/about/svcs/comperio/
-
There are no free copies of any FASB standards, because sales
of those standards are main sources of revenue to the FASB. My
advice is to contact Pricewaterhouse Coopers and subscribe to
their PW Researcher that contains all standards for a number of
nations, the IASC international standards, and all FASB
standards. You can get this on the PW Researcher CD-ROM that is
updated as new standards and interpretations come along. FAS 52
is one of those standards. One website for the PW Researcher
is
http://instruction.bus.wisc.edu/jfuhrmann/pwr/PW%20Researcher%20Guidelines.html
You might also
try
http://extranet.pw.com/PWRUpdates.htm
The other alternative is to order FASB standards directly
from the FASB at
http://www.rutgers.edu/Accounting/raw/fasb/public/index.html
-
Others
-
-
ACBSP Association of Collegiate Business
Schools and Programs
-
Associated Colleges of the South (ACS)
Palladian Fall 1998
-
Accounting Related
Resources
- American Association of Hispanic Certified Public
Accountants --- http://www.aahcpa.org/
The Institute of Chartered
Accountants in England and Wales Links Page
http://www.icaew.co.uk/link.ht
- International standards are also available along with accounting and auditing standards in
various nations are also available on the PriceWaterhouse Coopers
Compario at
http://www.pwcglobal.com/gx/eng/about/svcs/comperio/
-
-
Jensen & Sandlin Survey of U.S. Accountancy Education
Programs
-
The Institute of Internal Auditors
(IIA)
Internal Auditing World Wide Web (IAWWW)
-
Associationof Certified Fraud Examiners Home Page
The Institute of Financial Accountants (United Kingdom)
-
Prologueto Report to the Nation on Occupational Fraud and
Abuse (President Clinton)
-
AACSB Home Page
ACBSP (Association of Collegiate Business Schools and Programs )
Palladian Fall 1998
-
Association of Collegiate Business
Schools and Programs (ACBSP)
-
Associated Colleges of the South
-
ACCOUNTING RESOURCES
ON INTERNET
-
AICPA Home Page
-
American Accounting
Association Homepage
-
AMERICAN BAR ASSOCIATION
-
Arizona Society of CPAs
-
Center for
Educational Technology (CETA)
-
Certified Management Accountants (Canada)
-
CPA WIRE - home page for the California
Society of CPAs
-
Global Window Main
Menu (Business Schools and Culture of Japan)
-
Illinois CPA Society Members Home Page
-
Institute of
Management Accountants (IMA) ---
http://www.imanet.org/
-
MACPA Online
-
MNCPA
-
National Society of Accountants
(Association)
-
Oklahoma Society of CPAs
-
PICPA - Pennsylvania Institute of CPAs
-
Professional Associations Site Seeker
-
The IIA Home Page
-
The Ohio Society of CPAs
-
TSCPA
-
Upcoming Workshops
(ACS Associated Colleges of the South)
-
Utah Association of CPAs
-
CPA Online: Your source for Accounting
Information on the Internet
-
Career Bookmarks and
Threads
2019 Trends in in the supply of accounting
graduates and the demand for public accounting recruits ---
https://www.aicpa.org/content/dam/aicpa/interestareas/accountingeducation/newsandpublications/downloadabledocuments/2019-trends-report.pdf?utm_source=mnl:cpald&utm_medium=email&utm_campaign=06Sep2019
Keep in mind that there are many accountants who are not "public
accountants" (think of accounting careers in government, business firms,
schools, etc.). Having said this, many (certainly not most) of those
"non-public accountants" commenced their post-graduate careers for a
time as public accountants before going non-public. And not all public
accountants are Certified Public Accountants (or chartered accountants)
such as all those accountants and accounting firms who offer tax return
preparation services but are not licensed to conduct audits ---
https://en.wikipedia.org/wiki/Certified_Public_Accountant
Key insights
Accounting
Enrollments Total projected accounting enrollments are down 4%
from the highs of 2016, but are still among the highest on
record. Master’s enrollments are down 6% from 2016.
Racial/ethnic diversity has increased in the 2017-18 academic
year. Universities have reported increases in Hispanic or Latino
enrollees of 3 and 8 percentage points at the bachelor’s and
master’s levels, respectively. Seventy-two percent of bachelor’s
of accounting programs and 65% of master’s of accounting
programs expect to have the same or higher enrollment in 2019.
Accounting Graduates
Projected accounting graduates trended downward in the 2017-18
academic year, with decreases of 4% at both the bachelor’s and
master’s levels and overall. In 2018, female accounting
graduates outnumbered male graduates at the master’s level.
Racial/ethnic diversity has increased in accounting graduates,
with a 7 percentage point increase in Hispanic or Latino
accounting graduates.
Hiring In 2018, new
hires assigned to audit-related services increased by 4
percentage points, while new graduates assigned to taxation
declined by 4 percentage points. Hiring of new accounting
graduates slowed 11%. Across the last two Trends reports, we
have experienced an approximate 30% decline in hiring of new
accounting graduates. Non-accounting hires as a percentage of
all new graduate hires are up 11 percentage points to 31%. See
footnote for more information.
Hiring Expectations
Of firms that hired one or more accounting graduates in 2018, 58%
expect to hire the same number or more in 2019. Ninety percent
of all U.S. CPA fi rms expect to have the same number or more
CPAs on staff in 2019.
CPA Examination The
number of CPA Exam takers increased in 2015 and 2016 in
preparation of the new CPA Exam that launched in April 2017. CPA
Examination candidates decreased 7% between 2017 and 2018. The
number of CPA Exam candidates who passed their 4th section of
the exam decreased 6% between 2017 and 2018.
Some Jobs Nobody Knew About Until 2020 ---
https://www.businessinsider.com/linkedin-emerging-jobs-in-high-demand-in-2020-2019-12?utm_source=Sailthru&utm_medium=email&utm_content=BIPrime_select&utm_campaign=BI
Prime 2020-04-08&utm_term=BI Prime Select
Jensen Comment
Actually some of the jobs listed were hot before 2020 and may be
temporarily not so hot because of the pandemic.
There are two things to consider when choosing a career ---
opportunity versus security. For example, the hot jobs in large
accounting firms before 2020 were in consulting whereas the most secure
jobs were, and still are, in auditing and tax --- those careers we
really call "accounting careers." Everybody suspects consulting careers
in accounting firms will bounce back (maybe slowly) after the 2020
pandemic, but auditors and tax accountants have the most secure jobs
during 2020. Business firms still are required to have audits and file
tax returns during lockdown. They are not required to hire consultants
in these hard times.
Another example is academia. A small proportion of accountants (less
than 300 per year) leave the real world and enter accounting doctoral
programs. Many do so knowing that they will be making a lot less 20
years from now as college professors than if they commenced their own
accounting firms that are strategically placed in terms of services and
geography. There's a whole lot of opportunity that comes with starting
up an accounting firm, but there's no tenure security like the security
enjoyed by accounting professors.
For example, I started out my career with the largest CPA firm, then
called Ernst & Ernst, in Denver. With the training and experience I was
getting from E&E I seriously considered opening my own CPA firm in Aspen
back when Aspen was a decadent mountain town filled with decrepit wooden
houses --- houses renting out beds for $1.75 per night during ski week
ends. I don't know if my startup firm would've been a
success in Aspen, but I have daydreams that I might well have retired as
a multi-millionaire.
In reality I chose the secure path and retired comfortably after 40
years as an accounting professor. I've no regrets, because I've never
really had to guts to gamble big time.
While on the faculty of Trinity University one of my colleagues did
not get tenure. He then started his own tax and audit firm in San
Antonio and eventually retired (I'm guessing here) twenty times
wealthier than me. Sigh!
Chamber of Commerce Guide to Scholarships From Various Sources ---
https://www.chamberofcommerce.org/best-college-scholarships
Racial Profiles of Accountants in the USA (does not include
accountants of color other than African Americans)
There are 1,762,000 accountants and auditors in the United
States for the year 2008. They represent 1.2% of the total 145,362,000 employed
Americans for the same year. 61.1% of American accountants and auditors are
female while 10.2% are Asian. This data is based on the The 2010 Statistical
Yearbook of the United States Census Bureau ---
http://infomory.com/numbers/number-of-accountants-in-the-us/
For updates see
https://www.census.gov/library/publications/time-series/statistical_abstracts.html
Note that not all "accountants" even go to college. especially
those trained to do some accounting functions (think bookkeeping) on the job. To
sit for the CPA examination virtually all candidates now must have five years
(150 semester credits) including required courses in accounting, auditing,
ethics, and business.
Overall participation of African-Americans in the
accounting profession continues to be low. According to the U.S. Bureau of Labor
Statistics (BLS), African-Americans represent 12.1% of the employed workforce
but only 8.2% of the accountant and auditor workforce ---
https://www.journalofaccountancy.com/issues/2019/jan/challenges-continue-for-african-american-accountants.html
Out of 650,000 CPAs in the U.S., an estimated 5,000 are
black, according to the National Association of Black Accountants (NABA). The
number of black accountants has changed little in the past two decades while the
number of their Asian and Hispanic colleagues has grown to more than 12% and 7%
of the field ---
https://news.bloombergtax.com/financial-accounting/fifty-years-little-progress-for-black-accountants
The first African American CPA was John Wesley Cromwell,
Jr., licensed in 1921. John went on to lead a very successful career after he
became the controller of Howard University in 1930
http://gordoncpablog.wordpress.com/2009/04/10/56/
Jensen Comment
When I was Chair of the Accounting Department at Florida State University
(1978-1982) there were two major university accounting programs in Tallahassee
--- FSU and Florida A&M. The FSU program was heavily geared toward preparing
students for the CPA examination, and we did have African American Accounting
majors in the FSU program who prepared for and did become CPAs. The Florida A&M
(one of the better-known historically black universities) program at the
time was not geared to preparing accounting majors to take the CPA examination.
Accounting majors at Florida A&M usually had corporate apprenticeships to become
corporate accountants rather than CPAs. These accounting student apprenticeships
included major corporations like IBM and Exxon that gave a significant amount of
money to historically black universities in general.
I mention this because I think most historically black
universities (certainly not all like Howard University) at the time modeled themselves after Florida A&M. I think this
reflects African American career tracks in accounting that bypassed the CPA
examination entirely. African Americans aspiring to be CPAs mostly chose other
universities like FSU.
Footnote: I've not followed how Florida A&M and other
historically black universities changed their accounting curricula and goals
since 1982
The PhD Project --- http://www.phdproject.org/
Since 1994, The PhD Project has more than tripled
the number of minority business school professors...from 294 to over 960. These
individuals are inspiring and encouraging a new generation of business
professionals. Click here to learn more about our fifteen years of achievements,
real insights on the journey to a PhD degree and the professors who are making a
big impact.
Are you ready to be the next role model? Currently,
The PhD Project has 400 minority doctoral student members pursuing their dream.
Like you, they were professionals or recent grads satisfying their quest for a
high level of achievement and answering the call to mentor. With an expansive
network of support, The PhD Project is now helping them prepare for success in
academia.
Whether you become involved as a doctoral student,
professor, participating university, or supporting organization...just become
involved. Learn more by visiting the links on the left.
Participation in The PhD Project is available to
anyone of African-American, Hispanic American and Native American descent who is
interested in business doctoral studies.
Jensen Comment
The PhD Project commenced in the KPMG Foundation under the guidance of Executive
Partner Bernie Milano who increasingly devoted more time, money, and sweat to
raise money from other accounting firms and from corporations. It has since
expanded beyond accounting doctoral programs into other business disciplines.
Above and beyond helping minority students get into selected doctoral programs,
Bernie has been dogged about trying every which way to see them to the
graduation day endings when a wide array colleges in literally every part of the
world are eager to hire them. These students have many more hurdles to cross
than most other doctoral students, and Bernie's Dream is to help them across the
biggest hurdles without making it any easier for them then all other doctoral
students.
Most importantly, the salting of these graduates around the world as role models
is increasingly vital to inspiring undergraduate and even K12 minority students
to aspire to become practicing professionals and/or doctoral students
themselves. These role models are living proof that Berne's Dream can become
their dream.
Thank you Bernie, KPMG, and the many other accounting firms and corporations
have made Bernie's Dream come true.
How doctoral programs can help minority candidates
Video on the PhD Completion Program --- http://www.youtube.com/watch?v=zWtUTZk1w4Q
Also read about the efforts of the Bill and Melinda Gates Foundation --- Click
Here
Added Jensen Rant
Often potential minority candidates for accounting doctoral programs are CPAs.
They are strong accounting candidates that are attracted to accounting and
turned off by the heavy mathematics, statistics, and econometrics years of study
in accountancy doctoral programs that have almost no accountancy. It would help
greatly if some of our leading doctoral programs would open up paths of study
other than "accountics."
Alternative study and research paths could include paths of case method and
field research. Those graduates may never publish in The Accounting Review (which
now publishes zero case and field research studies according to the latest
report of the TAR Editor), but there are research journals that will publish
case and field research studies.
My rants ad nauseum on the narrow mindedness of present accountics
doctoral programs are shown at ---
http://faculty.trinity.edu/rjensen/theory01.htm#DoctoralPrograms
In his first President's Message, Gary Previts mentions the Plumlee report on
the dire shortage of accountancy doctoral students and provides a link to the
AAA's new site providing resources for research and experimentation on "Future
Accounting Faculty and Programs Projects" --- http://aaahq.org/temp/phd/index.cfm
Note especially the Accounting PhD Program Info link with a picture) and the PhD
Project link (at the bottom):
Welcome to the preliminary posting
of a new resource for the community participating in and
supporting accounting programs, students, faculty, and
by that connection practitioners of accounting. We plan
to build this collection of resources for the broad
community committed to a vital future for accounting
education. This page is an initial step to creating a
place where we can come together to gather resources and
share data and ideas.
New Research Projects by the AAA on the Trends and
Characteristics of Accounting Faculty, Students,
Curriculum, and Programs
Part I:
Future of Accounting Faculty Project (Report
December, 2007)
Part II: Future of Accounting Programs Project
Part I will
describe today's accounting academic workforce, via
demographics, work patterns, productivity, and
career progression of accounting faculty, as well as
of faculty in selected peer disciplines using data
from the national survey of postsecondary faculty (NSOPF)
to establish trends, and a set of measures will be
combined to benchmark the overall status of
accounting against (approximately) 150 fields. This
project will provide context and data to identify
factors affecting the pipeline and workplace.
Part II will
focus on expanding understanding of the
characteristics of accounting faculty, students, and
accounting programs, and implications of their
evolving environment. The need for the Part I
project illustrates how essential it is for the
discipline and profession of accounting that we
establish a more standard and comprehensive process
for collecting, analyzing, and reporting data about
accounting students, doctoral students, faculty,
curriculum, and programs.
More Resources
on the Changing Environment for Faculty:
The Reshaping of America's Academic Workforce
David W. Leslie, TIAA-CREF Institute Fellow
The College of William and Mary
TIAA Institute Research Dialogue Series, 2007
Jim Hasselback's* 2007 Analysis of Accounting
Faculty Birthdates
*Copyrighted – requests for use to J. R. Hasselback
- Among U.S.
Accounting Academics -- 53.4% are 55 or older
From the Integrated
Postsecondary Education System (IPEDS)
- 34.8% of all
full-time faculty in the U.S. are
non-tenure-track -- nearly 2 in 5 of all
full-time appointments
- Between 1993
and 2003 the proportion of all new full-time
hires into "off-track" appointments increased
each year from 50% to nearly 3 in 5 (58.6%)
- Reported in J.
Schuster & M. Finkelstein (Fall, 2006). "On the
Brink: Assessing the Status of the American
Faculty," Thought & Action 51-62.
Supply and
Demand for Accounting PhDs
American Accounting Association PhD Supply/Demand
Resource Page
A collection of resources, links, and reports related to
the pipeline of future Accounting faculty. Highlights
include:
- Report of the AAA/APLG
Committee to Assess the Supply and Demand of
Accounting PhDs
- Link to the
Doctoral Education Resource Center of AACSB
International (Association to Advance Collegiate
Schools of Business)
- AICPA's Journal of
Accountancy's article "Teaching for the Love of It"
Deloitte
Foundation Accounting Doctoral Student Survey
Survey Results (Summer, 2007)
Data collected by survey of attendees of the 2007
AAA/Deloitte J. Michael Cook Doctoral Consortium
The PhD Project
and Accounting Doctoral Students Association
The PhD Project is an information clearinghouse
created to increase the diversity of business school
faculty by attracting African Americans, Hispanic
Americans and Native Americans to business doctoral
programs and by providing a network of peer support.
In just 12 short years, the PhD Project has been the
catalyst for a dramatic increase in the number of
minority business school faculty—from 294 to 842,
with approximately 380 more candidates currently
immersed in doctoral studies.
The PhD Project Accounting Doctoral Students
Association is a voluntary association offering
moral support and encouragement to African-American,
Hispanic-American, and Native American Accounting
Doctoral Students as their pursue their degrees and
take their places in the teaching and research
profession, and serve as mentors to new doctoral
students.
PhD Project Surveys of Students, Professors, and
Deans
Results of a survey among students to understand the
impact of minority professors on minority and
non-minority students.
Accounting Firms
Supporting the AAA and Accounting Programs, Faculty, and
Students
Related
Organizations Sharing Interest in Accounting Faculty and
Programs
|
|
Gender Profiles of Accountants in the USA
There are 1,762,000 accountants and auditors in the United
States for the year 2008. They represent 1.2% of the total 145,362,000 employed
Americans for the same year. 61.1% of American accountants and auditors are
female while 10.2% are Asian. This data is based on the The 2010 Statistical
Yearbook of the United States Census Bureau ---
http://infomory.com/numbers/number-of-accountants-in-the-us/
For updates see
https://www.census.gov/library/publications/time-series/statistical_abstracts.html
Note that not all "accountants" even go to college. especially
those trained to do some accounting functions (think bookkeeping) on the job. To
sit for the CPA examination virtually all candidates now must have five years
(150 semester credits) including required courses in accounting, auditing,
ethics, and business.
Eight Special Women of Accounting --- http://www.journalofaccountancy.com/Issues/2007/Aug/EightSpecialWomenInAccounting.htm
Among the AICPA-donated volumes at Ole Miss
are two binders containing photographs of individuals appearing in the JofA or
at accounting conventions from 1887 to 1979. Of the 446 individuals
featured, eight are women—Christine Ross, Ellen Libby Eastman, Miriam
Donnelly, Mary E. Murphy, Helen Lord, Helen H. Fortune, Mary E. Lewis and
Beth M. Thompson. In a time when the profession was the all-but-exclusive
domain of men, they stood out not only because of their gender but in many
cases because of their accomplishments and contributions to accounting.
Consider that in 1933, slightly more than 100 CPA certificates had been
issued to women. By 1946, World War II had changed traditional notions of
gender in the workplace, and female CPAs had more than tripled to 360—still
a small contingent but, as information gleaned from the AICPA Library
indicates, one capable of exerting a strong and beneficial influence on the
profession.
Christine Ross
Born about 1873 in Nova Scotia, Ross took New York by storm in the late
1890s. New York state enacted licensure legislation in 1896 and gave its
inaugural CPA exam in December 1896. Ross sat for the exam in June 1898,
scoring second or third in her group. Six to 18 months elapsed while her
certificate was delayed by state regents because of her gender. But she had
completed the requirements and became the first woman CPA in the United
States, receiving certificate no. 143 on Dec. 21, 1899.
Ross began practicing accounting around
1889. For several years, she worked for Manning’s Yacht Agency in New York.
Her clients included women’s organizations, wealthy women and those in
fashion and business.
Helen Lord
Lord received her CPA certificate from New York in 1934 and in 1935 joined
the American Society of Certified Public Accountants, which merged with the
American Institute of Accountants (later AICPA) the following year. In 1937,
she was a partner with her father in the New York firm of Lord & Lord and a
member of the AIA. She served in the late 1940s as business manager of The
Woman CPA, published by the American Woman’s Society of Certified
Public Accountants–American Society of Women Accountants. Lord reported the
journal then had a circulation of more than 2,200.
Helen Hifner Fortune
Fortune, one of the first women CPAs in Kentucky, received certificate no.
174 in 1935 and was admitted to the AIA the following year. She became a
member of an AIA committee in 1942 and by 1947 was a partner in the
Lexington, Ky., firm of Hifner and Fortune.
Ellen Libby Eastman
Eastman began her career as a clerk in a Maine lumber company, eventually
becoming chief accountant. She studied for the CPA exam at night and became
the first woman CPA in Maine, receiving certificate no. 37 dated 1918. She
was also the first woman to establish a public accounting practice in New
England. Arriving in New York in 1920, Eastman focused on tax work and
audited the accounts of the American Women’s Hospital in Greece. In 1925,
she was a member of the ASCPA. In 1940, Eastman began working with the law
firm of Hawkins, Delafield & Longfellow in New York.
She was outspoken and eloquent regarding a
woman’s ability to succeed in accounting. In a 1929 article in The
Certified Public Accountant, Eastman recounted her adventures:
One must be willing and able to endure
long and irregular hours, unusual working arrangements and difficult travel
conditions. I have worked eighteen out of the twenty-four hours of a day
with time for but one meal; I have worked in the office of a bank president
with its mahogany furnishings and oriental rugs and I have worked in the
corner of a grain mill with a grain bin for a desk and a salt box for a
chair; I have been accorded the courtesy of the private car and chauffeur of
my client and have also walked two miles over the top of a mountain to a
lumber camp inaccessible even with a Ford car. I have ridden from ten to
fifteen miles into the country after leaving the railroad, the only
conveyance being a horse and traverse runners—and this in the severity of a
New England winter. I have done it with a thermometer registering fourteen
degrees below zero and a twenty-five mile per hour gale blowing. I have
chilled my feet and frozen my nose for the sake of success in a job which I
love. I have been snowbound in railroad stations and have been stranded five
miles from a garage with both rear tires of my car flat. I have ridden into
and out of open culvert ditches with the workmen shouting warnings to me.
And always one must keep the appointment; “how” is not the client’s concern.
Mary E. Murphy
A long-lived pioneer, Murphy (1905–1985) lectured, researched and taught in
the United States and abroad, retiring in 1973. The Iowa native earned her
bachelor of commerce degree with a major in accounting from the University
of Iowa in 1927, then obtained a master’s in accountancy in 1928 from
Columbia University Business School. In 1938, she received a doctorate in
accountancy—only the second woman in the United States to do so—from the
London School of Economics.
In 1928, Murphy began working in the New York office of Lybrand, Ross Bros.
& Montgomery. Two years later, she took the CPA exam in Iowa and received
certificate no. 67, to become the first woman CPA in Iowa. She joined the
AIA in 1937.
Following her public accounting stint, she
served for three years as the chair of the Department of Commerce at St.
Mary’s College in Notre Dame, Ind. Murphy also was an assistant professor of
economics at Hunter College of the City University of New York until 1951.
In 1952, she received the first Fulbright professorship of accounting, with
assignments in Australia and New Zealand. In 1957, she was appointed as the
first director of research of the Institute of Chartered Accountants in
Australia. Murphy retired in 1973 from the accounting faculty at California
State University.
She published or collaborated on more than
20 books and 100 journal articles and many book reviews and scholarly
papers. From 1946 to 1965 she was the most frequently published author in The
Accounting Review. Murphy investigated the role of accounting in the
economy, made the case for accounting education improvements and paved the
way for other aspiring women accountants to prosper. More than half her
publications explored international accounting, often advocating
standardization. She also emphasized accounting history and biographies.
Mary E. Lewis
Lewis received California CPA certificate no. 1404 in 1939. She was admitted
to the AIA that year and by 1947 had her own firm in Los Angeles.
Beth M. Thompson
Thompson worked as the office manager in the Kentucky Automobile Agency she
and her husband, Charles R. Thompson, owned. After closing the car business,
they moved to Florida, where she worked for an accounting firm. She passed
the CPA exam in 1951 with the encouragement of her husband and opened her
own accounting business in Miami. In 1955, Thompson was one of only 900
women CPAs and the only female president of a state association chapter—the
Dade County chapter of the Florida Institute of CPAs.
Miriam Donnelly
From 1949 to 1955, Donnelly was head librarian of the AIA library. (In 1957,
the AIA was renamed the AICPA.) She began her career with the library as
assistant librarian and cataloger in 1927, after working for two
governmental libraries and the New York Public Library.
History of women accountants in the 1880. US Federal Census ---
http://repository.usfca.edu/cgi/viewcontent.cgi?article=1001&context=acct
Christine Ross (The First Woman CPA) --- Click
Here
http://books.google.com/books?id=W8Z2a53DJ2cC&pg=PA151&lpg=PA151&dq=%22First+Woman+CPA%22&source=bl&ots=irXssMWzFN&sig=0AneWv1qO-MB6_ixatHq-mMerRQ&hl=en&sa=X&ei=N8o8UY3XBYrK0AHngoCYBw&ved=0CDgQ6AEwAQ#v=onepage&q=%22First%20Woman%20CPA%22&f=false
Mary Jo McCann (First Woman CPA in Kansas) ---
http://www.kscpa.org/about/news/119-mary_jo_mccann_first_woman_cpa_in_kansas_passes
Bertha Aldrich (First Woman CPA in California) --- http://boards.ancestry.com/surnames.aldrich/600/mb.ashx
Accounting Reform (search for women) --- http://en.wikipedia.org/wiki/Accounting_reform
American Society of Women Accountants --- http://en.wikipedia.org/wiki/University_of_Cambridge#Women.27s_education
Accounting and Financial Women's Alliance --- http://www.afwa.org/
Accounting History Libraries at the University of
Mississippi (Ole Miss) --- http://www.olemiss.edu/depts/accountancy/libraries.html
There are many items pertaining to accounting women in history, especially
in the Accounting Historians Journal
Ruth Andersen, First Woman on the Board of a Big Four Accounting Firm --- http://en.wikipedia.org/wiki/Ruth_Anderson_%28accountant%29
Cynthia Cooper (Internal auditor who blew the whistle at WorldCom) --- http://en.wikipedia.org/wiki/Cynthia_Cooper_%28accountant%29
Lynn Brewer was never enough of a player to even mention in my threads on the
Enron scandal
The foul mouthed Sherron Watkins was the significant whistleblowers at Enron
http://faculty.trinity.edu/rjensen/FraudEnronQuiz.htm#10
Grace Andrews (early mathematician and accountant in Barnard College) --- http://en.wikipedia.org/wiki/Grace_Andrews_%28mathematician%29
Patricia Courtney (IRS agent and professional baseball star) --- http://en.wikipedia.org/wiki/Patricia_Courtney
Patrecia Barringer (Tax accountant, auditor, and professional baseball star) ---http://en.wikipedia.org/wiki/Patricia_Barringer
Helen Nordquist (Telephone operator, accountant, and professional baseball star)
--- http://en.wikipedia.org/wiki/Helen_Nordquist
Rita Lee (Accounting Student Tennis Star) --- http://en.wikipedia.org/wiki/Janet_Lee
Diane Cummins (Canadian Accountant Track Star) --- http://en.wikipedia.org/wiki/Diane_Cummins
Sue Hearnshaw (British Chartered Accountant and Long Jump Star) --- http://en.wikipedia.org/wiki/Sue_Hearnshaw
Betty Wagner Spandikow (Accountant Who Became an Advocate of Breast Feeding)
--- http://en.wikipedia.org/wiki/Betty_Wagner_Spandikow
Jennifer Archer (Oil and Gas Accountant Turned Fiction Writer) --- http://en.wikipedia.org/wiki/Jennifer_Archer
'Death by a Thousand Cuts': Why Are Women Leaving Big Law?
---
https://www.law.com/americanlawyer/2019/11/14/death-by-a-thousand-cuts-why-are-women-leaving-big-law-405-48434/?slreturn=20200429140136
Underemployed: 41% of
Recent Grads Work in Jobs Not Requiring a Degree ---
https://www.insidehighered.com/quicktakes/2020/02/18/41-recent-grads-work-jobs-not-requiring-degree?utm_source=Inside+Higher+Ed&utm_campaign=d5b88a680c-DNU_2019_COPY_01&utm_medium=email&utm_term=0_1fcbc04421-d5b88a680c-197565045&mc_cid=d5b88a680c&mc_eid=1e78f7c952
Jensen Comment
This seems high when you think of all those who are in jobs requiring a
degree (think nursing) but are not employed full time plus all those who
are not employed at all while focusing on raising a young family.
This also seems high given the low unemployment rates in the present
economy.
One issue is that some lower-level jobs (think working for Amazon) pay
better and have more benefits (medical insurance, paying graduate school
tuition, and unemployment insurance) relative to working in so-called
"higher-level" jobs.
In a given a given discipline there may be jobs available that are not
attractive because of location (think having to move to an expensive
city) or having to live apart from a spouse. In accounting some of my
graduates in San Antonio could not find local jobs in a Big 4 accounting
firm when all sorts of openings were available in the Big 4 San
Francisco offices). Try living on a starting accountancy wage in San
Francisco.
The advantage of
accounting was that even in a graduate could not get into a local Big 4
office in San Antonio there were usually other accounting jobs available
in San Antonio if you scratched around hard enough. Those accounting
jobs, however, usually did not provide the benefits of expensive formal
training and student loan forgiveness provided by the Big 4.
How to Mislead With Statistics
Warning Signs about the Future Supply of Accounting
Graduates ---
https://www.cpajournal.com/2019/10/11/warning-signs-about-the-future-supply-of-accounting-graduates/
Jensen Comment
The article raises concerns that accountancy may be losing ground to
some other college majors. However, this is a bit misleading since
virtually all college majors are in trouble because of aggregate college
enrollment declines.
The Great Enrollment Crash: Students aren’t showing up. And it’s
only going to get worse ---
https://www.chronicle.com/interactives/20190906-Conley?utm_source=cr&utm_medium=en&cid=cr&source=ams&sourceId=296279
. . .
The handwriting (for enrollment declines) was
probably on the wall, as the national, first-year discount rate had already
crested the 50-percent mark; according to the National Association of
College and University Business Officers (NACUBO), it was 39 percent as
recently as 2008. This steep rise is significantly fueled by colleges that
have adopted the airline pricing model: If the plane is going to fly anyway
(and if there are still spots open), no harm in getting even pennies on an
otherwise unsold ticket. For colleges discounting at or above the national
figure, this is unlikely to be a sustainable strategy. However, in the
meantime, they are no doubt pulling students away from colleges that expect
full-pay or better-pay students to foot the true bill. In short, price
sensitivity is a structural reality when supply (number of college beds and
desks) is greater than demand.
. . .
Disruption is here to stay. Campus leaders cannot
change the wind direction, but they can trim the institutional sails. For
too long, the admissions dean or enrollment manager had the lone hand on the
tuition-revenue tiller. Now, it’s all hands (campus leadership, faculty,
staff, trustees, etc.) on deck, pulling the tactical lines in a coordinated,
strategic fashion. Given the perilous voyage ahead, what will your
institution’s mix of majors, money, and mission be?
Bill Conley is vice president for enrollment management at Bucknell
University.
To the extent that accountancy may be may be losing more than it's
share of majors in 2019 the cause may be partly do to the 2019 stage in
the economic cycle. The USA is still at the crest of a long boom wave
with very low unemployment. When the job market is hot in competing
disciplines accountancy typically loses some majors to hot job markets
in information technology, science, and finance. However, in recessions
those job markets cool down much more dramatically than tried and true
accountancy that sees less variation in the economic cycle. In bad times
business firms still need audits and must file their tax returns.
Women and Girls in Science
Wogrammer ---
https://wogrammer.org/
Emerging Female Scientists ---
https://emergingfemalescientists.com/
Lesson Plan: Chien-Shiung Wu, Chinese Nuclear Physicist ---
www.aip.org/history-programs/physics-history/teaching-guides-women-minorities/chien-shiung-wu-chinese-nuclear-physicist
Women in Science, Technology, Engineering, and Mathematics: Quick
Take ---
www.catalyst.org/research/women-in-science-technology-engineering-and-mathematics-stem
Women in Science ---
www.colorincolorado.org/booklist/women-science
Bob Jensen's threads on women in the professions ---
http://faculty.trinity.edu/rjensen/Bookbob2.htm#Women
How Are Public Accounting Salaries Stacking Up for
2020?
https://goingconcern.com/public-accounting-salaries-2020/
One problem in reporting salaries is that so many public
accountants own their own practices or are in small partnerships. Many
have no salaries and instead rely on profits. I have a CPA friend who
did not finish his Ph.D. and was denied tenure. However, he was a great
CPA who started up his own firm, specialized in accounting and tax
services for wealthy physicians and Texas ranchers, and made a fortune.
However, before he retired he had no "salary" to report in surveys like
the one above. Similar problems arise when reporting the "salaries" of
physicians and lawyers who own their own practices or share partnership
profits.
Jensen Comment
Accounting major numbers often decrease in times of economic prosperity
with the best example arising in the roaring 1990s when so many college
students became finance majors (intending make millions on Wall
Street before the Enron bubble burst in 1999) and computer science
majors (at a time when new technology firms were sometimes offering
million-dollar signing bonuses in stock options that later turned
worthless when the technology bubble burst). In recessions many students
find their way to accountancy because of the relative stability of
accountancy job offerings.
Becoming a CPA became somewhat more difficult and expensive as states
across the USA commenced to require 150 credits to sit for the CPA
examination with most aspiring CPAs today now getting masters degrees
because of the 150-credit requirement. Of course accounting graduates
not aspiring to be CPAs can still graduate in four years and enter the
job market as non-CPAs.
The problem with non-public accounting entry level
jobs (think FBI agents and corporate accountants) is that
experience is often required, whereas large CPA firms have a tradition
of hiring top graduates who do not yet have experience beyond very brief
internships while they are still in college. There's a huge attraction
for undergraduates in accounting to go on to get masters degrees and
start out in public accounting firms. Their intent is to gain experience
needed in public accounting to land those non-public accounting job
offers. Many public accountants do in fact end up jumping ship to work
for audit and tax clients of CPA firms. CPA firms even consider them as
their "alumni."
One exception is the IRS that, unlike the FBI and
other government agencies, will hire inexperienced accounting majors and
train them for their jobs. The IRS, however, in recent years has been
hobbled by declining budgets.
Because of the short supply (slightly over 200 per
year) of new accounting Ph.D.s hoping to get tenure-track jobs,
new Ph.D.s in accountancy are often the highest-paid new assistant
professors on campus. However, one of the factors holding down the
supply of new accounting Ph.D.s is the requirement by accounting
doctoral programs that applicants have professional accounting
experience. Whereas STEM majors in science can enter doctoral programs
immediately after earning BS degrees, this is not usually the case for
new accounting doctoral students ---
http://www.jrhasselback.com/AtgDoctInfo.html
Hi XXXXX
I'm looking
forward to meeting you face-to-face. I taught accounting and did
accounting research for 40 years at four different universities
(Michigan State, University of Maine, Florida State University, and
Trinity University in Texas) which means that I'm both old and somewhat
experienced at guiding students into and out of careers.
Before we
meet I would like to have you browse my threads on careers at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
There's too much here to read in detail, but do focus in on available
discussions of advantages and disadvantages of careers.
I apologize for some broken links in this archive. It has evolved over
the past 20 years, and one thing is certain about Web archives is that
links are not always permanent.
I also apologize that the above archive is more like a scrapbook built
on cut-and-paste rather than a better designed book. I have many such
"scrap books" linked at my homepage ---
http://faculty.trinity.edu/rjensen/bookbob.htm
What I think
is one of the most important considerations is to choose a career that
leads to varied opportunity tracks. Then if you end up where you're
unhappy there are other choices. For example, physical therapy is often
a poor career track because there are so few opportunities for finding
other tracks from that specialty. My ophthalmologist makes a lot of
money replacing cataracts day in and day out, but he's so bored that
he's getting an online MBA degree and thinking about another much lower
paying career.
Graduates
these days face many uncertainties that were not a factor for my
generation. Machines (e.g., robots) of the future will displace tasks
and entire jobs in ways that we can barely imagine. For example, it's
obvious that automation is already replacing warehouse workers. Not so
obvious is that technology (such as chatbots) will replace teachers,
especially college-level teachers and trainers.
Accounting
is still a good major for a variety of reasons, including the fact that
there's still high demand for accountancy graduates relative to supply.
More importantly there are highly varied opportunity tracks available
five or ten years down the road after graduation. The most typical path
for top graduates (say the top third of a graduating accounting class)
is to go to work for a large public accounting firm for 5-10 years and
then take advantage of job offers that usually come from clients of that
firm. The most typical opportunities for graduates in that public
accounting firm are auditing tracks, tax tracks, or accounting
information systems tracks (computers and networking in accounting
systems). Did you know that the FBI is always seeking accountants due to
the explosion of white collar crime? However, the FBI is usually looking
for accountants with some professional experience.
Since top
executives in nearly every company need to understand accounting,
accounting is often a fast track to the executive suite. Some
accountants prefer to work on their own as sole-practitioners of
partners of very small and often rural firms.
At this
point there's a lure of technology such as graduating in information
technology. I think it's better to minor in information technology or
computer science than to major in such a narrow specialty. The problem
is that jobs in IT or computer programming are so specialized that
there's not a great opportunity for opportunities in the executive suite
or in higher level professional services.
Another
advantage of accounting is that if you decide after getting a few years
experience as an accountant that you want to become an accounting
professor, you will discover that choosing accounting as a specialty is
probably the best choice a professor can make. There's such a shortage
of accounting professors that they are usually the highest paid
professors on campus. Secondly, they can choose to teach and do research
at most any college since virtually every college is looking to hire
accounting professors. Also note that getting a Ph.D. in accounting is
free in nearly every university offering accounting Ph.D. degrees.
Tuition is not only free, you will get an allowance for room and board.
But it's hard to get into an accounting Ph.D. program unless you have
professional experience as an accountant.
There are
always drawbacks to any career track. For example, accounting graduates
often earn lower starting salaries than some other graduates like
chemical engineers. However, accounting firms provide important benefits
such as expensive training, experience, and varied client exposure that,
in turn, lead to great opportunities. Accounting is a tougher major than
most other business majors, requires more specialized courses, and even
requires a fifth year not required for most other business majors.
Masters in accounting programs sometimes even take slightly more than a
year such as three semesters.
When you
major in engineering you're often trapped into engineering work. As an
accountant you typically have more opportunities beyond accounting work
such as becoming a finance officer or even a CEO.
If you elect
to major in accounting I recommend doing so at a flagship university in
a state. For example, majoring in accounting at the University of Maine
or the University of New Hampshire is preferable to majoring in
accounting at the University of Maine in Farmington or Plymouth State
University. When you visit a campus before making a decision about where
to go, ask what proportion of the graduating accounting class last year
got offers from the Big Four accounting firms. The Big Four recruit
heaviest in the best accounting education programs in any state in the
USA.
There is
such a shortage of accounting professors that the smaller universities
in a state usually cannot afford very good accounting faculty.
The top
accounting programs in the USA are listed in the first table you
encounter at
http://www.jrhasselback.com/FacDir/A2016-2017.pdf
This is a listing of the accounting programs that also have accounting
Ph.D. programs. The numbers in that table are the numbers of accounting
Ph.D. degrees awarded.
Other
accounting programs are listed in this directory. Note the number of
accounting faculty on any campus you're considering. If there are fewer
than ten accounting faculty the larger accounting firms are probably not
recruiting for graduates on that campus.
Feel free to
email your questions to me at any time.
Bob Jensen
Best Accounting Major Jobs And Careers ---
https://www.zippia.com/accounting-major/
Across nearly three decades there have been over twice as many
philosophy Ph.D. graduates as there are job openings for philosophers in
academia ---
http://www.apaonline.org/?page=nonacademic
Many humanities Ph.D.s, including some in philosophy, have chose to
teach management and marketing in business schools after taking the
AACSB's Bridge Program ----
http://www.aacsb.edu/bridge/
2019 Accounting Internship Programs, Ranked ---
https://goingconcern.com/2019-accounting-internship-programs-ranked/
The best-paid and most promising internship in
every field, according to more than 13,000 interns who know ---
https://www.businessinsider.com/best-internships-every-field-vault-survey-2018-10
Jensen Comment
Accountancy internships are usually less than two months and do not
particularly pay well. The good news is that there are a lot of
internships available, and accounting interns usually return to complete
their masters degrees with job offers in hand.
How to Mislead With Statistics
The 25 best high-paying jobs in America for 2018 ---
https://www.businessinsider.com/best-highest-paying-jobs-in-america-for-2018-2018-1
Jensen Comment
By now you may be weary of my repeated criticisms of job rankings based on
compensation. But there are a few new twists in my criticisms below.
I would be less critical if these were starting salaries. But one does not
become a "Manager" immediately after graduation. Becoming a manger nearly always
requires years of experience. You must accordingly throw in years of experience
into the other job categories in this study you run into all sorts of problems.
One is the problem of profit sharing. Usually partners or shareholders in a LLC
corporation have profit sharing that makes compensation comparisons with
salaries very misleading. For example, a partner in a law firm is compensated
much differently than an experienced lawyer who has not yet been admitted to the
partnership. And partner compensation varies a great deal based upon specialty
and rewards for bringing in and maintaining clients. And there are huge issues
regarding deferred compensation of various types. Doctors and lawyers for
example may take lower salaries than others while letting the
values of their shares in the partnership increase
annually by larger amounts.
My point here is that professionals commonly have equity interests in
their firms such that there are choices regarding how fast equity values
increase versus how fast they deplete the value with current "salaries."
In the above rankings physicians are the big winners but it's not
clear how some expenses are factored into the comparisons. Some
physicians (especially surgeons and anesthesiologists) must pay their
own enormous malpractice insurance premiums
whereas others have those premiums paid by others (such as hospitals or
employers). And those premiums vary a great deal in different parts of
the nation such as in Mississippi having very high premiums and in Texas
having very low premiums due to a constitutional amendment capping
punitive damages.
Some job categories have much more statistical variance and kurtosis
than other job categories. For example, the variance in compensation for
financial advisors is enormous. Much of it depends upon the wealth of
clients and established reputations of employers.
My point here is that a college student who chooses to track into a
financial advising career faces enormous income uncertainty relative to
a student who tracks into most any physician specialty.
This idea of variance is extremely important in terms of upper limits
of success. Sure a nurse anesthetist may have a median salary of
$160,270, but I don't know of any nurse anesthetist who make over $2
million per year like some lawyers.
The outcome for political scientists surprised me in the above study
since political scientists in academe (where most of them are employed)
are not usually paid notably more than other social scientists, physical
scientists, computer scientists, and business professors. There is also
an enormous variation in academic salaries between professors in
prestigious universities versus those thousands of colleges further down
the line that struggle to meet payroll expenses.
I could carry on with my other canned
complaints about compensation rankings in general, but I think you catch
my drift. I think that rankings on the basis of median compensation
without added disclosures of sampling populations, variances, and
kurtosis are highly misleading for young people choosing careers.
Bob Jensen's career helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Four great reasons to switch your career and become an accountant ---
https://www.businessinsider.com/sc/accounting-career-switch-reasons-2018-9
Jensen Comment
The "Pay is Great" Reason 2 is misleading. Except where accountants own
their own firms they are not likely to receive high-end compensation as
spectacular as many other professionals like physicians, architects,
etc. The incomes of lawyers are difficult to compare, because there is
such variance in lawyer earnings.
And starting salaries of accounting
graduates are generally lower than those of actuaries, engineers,
computer scientists, and pharmacists. Students are drawn to accounting
by the availability of entry-level jobs not requiring prior experience.
More importantly they are drawn into those jobs because of the valuable
training and experience received and the ability to then branch off into
so many, many specialties in both the private and public sectors. Years
ago I read where, due to an increase in white-collar crime, the FBI
hired more experienced accountants than
experienced lawyers. That may have changed today due to the FBI's needs
for experienced technology experts.
Accounting is also one of the best tracks to the executive suites.
CEOs and CFOs often rose up from accounting degrees. In many of these
instances, however, accountants took on other specialties, especially
finance and marketing, along the way up.
Accounting, like law and medicine, is attractive due to both rural
and urban opportunities. Graduates in computer science and engineering
may find slim pickings for careers in small rural communities. However,
those communities still need teachers, nurses, physicians, lawyers, tax
accountants, and small business accountants.
And because of supply versus demand new accounting Ph.Ds are often
the highest-paid $125,000+ new faculty on college campuses ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingFaculty
How to become a CPA in Texas
https://discoveraccounting.org/become-a-cpa/texas/
The College Board: Big Future: College Search (helpers for choosing a college)
---
https://bigfuture.collegeboard.org/college-search
Helpers in Choosing a College from the Chronicle
of Higher Education ---
http://collegerealitycheck.com/en/
Note the "Find Colleges" button
The 50+ Best Websites for Job Searches ---
http://careersherpa.net/50-best-websites-for-job-search-2017/
From the Chronicle of Higher Education
Search for Job Openings in Higher Education ---
https://chroniclevitae.com/job_search/new
Resources for Career Counselors ---
http://www.iseek.org/guide/counselors/counselorresources.html
Higher Education Recruitment Consortium ---
http://www.hercjobs.org/
Chegg Center Career Advice ---
https://www.chegg.com/career-center/advice
Be an Actuary ---
http://www.beanactuary.org/
Journal of Hotel & Business Management
---
http://www.omicsgroup.org/journals/hotel-business-management.php
American Sociological Association: Facts on Jobs and Careers ---
http://www.asanet.org/employment/factsoncareers.cfm
STEM Career ---
http://stemcareer.com/
The Bloomberg Job Skills Report 2016: What
Recruiters Want ---
http://www.bloomberg.com/graphics/2016-job-skills-report/?cmpid=BBD020916_BIZ
Reddit Career and Job Application Helpers ---
https://www.reddit.com/
Current Job Openings in Accounting
-
http://www.mastersinaccounting.info/jobs/
-
accounting/finance job openings across the 50 States, updated daily
http://www.mastersinaccounting.info/salary/
-
accounting job information salary per State and region
-
Becoming an FBI Agent --- Part 1
https://www.fbi.gov/news/stories/becoming-an-agent-part-1
Momas, Don't Let Your Babies Grow Up to Be
Appraisers ---
https://www.magzter.com/article/Business/Bloomberg-Businessweek/Mamas-Dont-Let-Your-Babies-Grow-Up-To-Be-Appraisers
Momas, Don't Let Your Babies Grow Up to Be Cowboys (Skip the Add) ---
https://www.youtube.com/watch?v=nlIEoKg8ZQg
Seven TED talks for accountants ---
https://www.journalofaccountancy.com/newsletters/2017/nov/7-ted-talks-accountants.html?utm_source=mnl:cpald&utm_medium=email&utm_campaign=29Nov2017
Only one in five people take up this incredibly generous pension to retire
at 40 (from the USA military) ---
https://qz.com/929153/only-one-in-five-people-take-up-this-incredibly-generous-pension-to-retire-at-40/
Life in the military isn’t easy, but if you
serve long enough the financial rewards, at least, are great. The US
military offers very generous pension benefits—after 20 years of
service, members can retire with 50% of their final salary for the
rest of their lives.
Since that allows most to retire around age
40, the payouts may last for a very long time (and they are also
adjusted for inflation). In 2015, the US military paid out $57
billion in pension benefits (pdf) to more than 2 million veterans,
or nearly 10% of its annual budget.
Continued in article
Jensen Comment
The question should be how much salaries would have to be raised to
offset the attraction of benefits from serving in the USA military.
Great benefits from serving in the military are training (think
mechanics, electronics, health care, and pilot training), medical
benefits, college financing (mostly by those who only serve a few
years), and pension benefits (used by those who serve 20-30 years) that
pay even when you take on a private sector job at around age 40-50. Odds
of battle injury or death are miniscule, but other parts of military
life suck such as low pay, absence from family, stress, and constant relocation of assignments. My
cousin's grandson got great training for the private sector as a senior
helicopter mechanic.
For many, however, a military career is a great entry-level career.
Many that want this career badly are rejected for the all-volunteer
service.
Why Are African American Students
Still Not Majoring in Accounting? ----
https://www.cpajournal.com/2018/01/08/african-american-students-still-not-majoring-accounting/
From the CFO Journal's Morning Ledger on March 7, 2017
Companies grapple with an accountant
shortage as regulations change,
Vipal Monga writes in today’s Business &
Finance section. Businesses are
increasingly scrambling to find regulatory experts or “technical
accountants” who understand rules and ensure compliance amid
accounting changes to the generally accepted accounting principles
that govern U.S. financial reporting.
Increasingly, companies are competing for talent with major
accounting and audit firms that had once served as a reliable
pipeline for corporate finance back offices. Some firms are
attempting to change their work culture to retain talen
The shrinking pool of available accountants is putting pressure on
companies as they begin to apply new Financial Accounting Standards
Board rules. The changes affect the way firms book revenue and
report the value of leases held on their balance sheets.
The rules don’t take effect right away: Public companies must apply
new revenue standards for fiscal years beginning after Dec. 15, and
new lease rules begin in 2019. Still, corporations must assess and
revise two years of past financial reports. “There is a demand for
technical expertise, absolutely,” said Robert Grecco, controller at
luxury fashion brand Ralph Lauren Corp. “And that demand is
only going to increase.”
From the Scout Report on December 16, 2016
New Study Uncovers Alumni Attitudes Toward College Career Services
Students Who Get Better Career Guidance Remember College More Fondly
http://www.npr.org/sections/ed/2016/12/15/505005019/getting-good-career-advice-will-make-your-college-experience-better
Only 17 percent of recent graduates say career centers are 'very
helpful'
https://www.insidehighered.com/news/2016/12/13/only-17-percent-recent-graduates-say-career-centers-are-very-helpful
Gallup-Purdue Index Report 2016
http://www.gallup.com/reports/199172/gallup-purdue-index-report-2016.aspx
Colleges Really Need to Rethink the Career Advice They Deliver
https://www.theatlantic.com/education/archive/2016/12/colleges-really-need-to-rethink-the-career-advice-they-deliver/510647
O*NET OnLine
https://www.onetonline.org
U.S. Bureau of Labor Statistics: Resources for Jobseeker or Worker
https://www.bls.gov/audience/jobseekers.htm
"Women Dominate College
Majors That Lead to Lower-Paying Work," by Sarah Green Carmichael,
Harvard Business Review, April 19, 2017 ---
https://hbr.org/2017/04/women-dominate-college-majors-that-lead-to-lower-paying-work?referral=00563&cm_mmc=email-_-newsletter-_-daily_alert-_-alert_date&utm_source=newsletter_daily_alert&utm_medium=email&utm_campaign=alert_date&spMailingID=17048645&spUserID=MTkyODM0MDg0MAS2&spJobID=1001676407&spReportId=MTAwMTY3NjQwNwS2
The pay gap between men and women in the
U.S. — the
80-ish cents on the dollar that the
average woman earns for every dollar the average man does — has
narrowed at such a slow pace that it would be unfair to glaciers to
call it glacial.
When people talk about the pay gap, what
this phrase typically means is that a woman is being paid less than
a man for doing the same work. A well-known example is
Lilly Ledbetter, who had worked in
a tire factory for almost 20 years when a colleague left her an
anonymous note revealing she’d been earning thousands of dollars
less than men in the same position.
But these kinds of pay gaps — same role,
same experience, same firm — account for only a portion of the 20%
pay gap between men and women, a gap that’s much worse for
women of color. Large chunks of the
gap can be accounted for by differences like industry and role. And
at the root of these differences, according to
a new research report by Glassdoor,
could be college majors.
Examining 46,934 resumes shared on
Glassdoor by people who graduated between 2010 and 2017, the
researchers looked at each person’s college major and their
post-college jobs in the five years after graduation. They then
estimated the median pay for each of those jobs (also using
Glassdoor data) for employees with five years of experience or less.
Their key finding: “Many college majors that lead to high-paying
roles in tech and engineering are male dominated, while majors that
lead to lower-paying roles in social sciences and liberal arts tend
to be female dominated, placing men in higher-paying career
pathways, on average.”
When I spoke with Andrew
Chamberlain, Glassdoor’s chief economist, he explained that one of
his hopes with this research was to give all college students more
insight into which majors pay the most, so that they can make
informed decisions about which major they choose. He’s also hoping
that “by showing young women the facts about what they could
potentially earn, more of them might choose a physics or engineering
major,” and that more of them will persist in those majors even if
they’re the only woman in some of their courses.
That is a noble goal, but it’s one
that I was skeptical would work. In our society, maleness and
prestige often go together.
Jobs that are unconsciously coded male have
more prestige and pay than jobs that are coded female. This is why a
custodian or a janitor (usually a man) gets paid more than a maid or
a “cleaning lady” (categorically female — have you ever heard of a
“cleaning gentleman”?). And it’s one of many reasons that male
factory workers who get laid off don’t
rush into “pink-collar” jobs — not
only do these jobs pay less, but they also are inescapably lower
prestige. Corporate America is not immune to these trends: HR,
once considered the
most glamorous department to work in,
has since become highly
feminized, and must now
fight for respect at the C-suite
table.
A series
of studies have shown just how
tightly gender, prestige, and pay are tangled. Researchers have
found that the pay gap is not as simple as women being pushed into
lower-paying jobs. In effect, it is the other way around: Certain
jobs pay less because women take them. Wages in biology and
design were
higher when the fields were predominantly
male; as more women became biologists and designers, pay dropped.
The opposite happened in computing, where early programmers were
female. Today, that field is one of the most predominantly male
— and one of the highest paying. The wage gap remains
the widest at the top of the income ladder,
where jobs tend to be male dominated.
I suspect that our assumptions about
what type of work is skilled or specialized is also subtly gendered,
although I’m not aware of any research examining this
specific question. But why do we assume that STEM subjects are
“harder” than subjects that are more person- or language-oriented?
Aren’t human beings just as complex as code? When I posed my
hypothesis to Chamberlain, he was skeptical. He pointed out that if
you write bad code, the program probably just won’t work. Human
beings are less rigid, or just have lower standards. When it comes
to writing, for example, “many people are willing to accept mediocre
work.” (Sigh.) There’s also the pesky issue of market forces and the
skills that society values. Music may be a highly technical field,
but it’s a low-paying one.
Nonetheless, the Glassdoor data does show
that even when women and men study the same subject, women sort into
lower-paying jobs when they get out of school. For example, among
female biology majors, the top post-college jobs are lab technician,
pharmacy technician, and sales associate. Among the male graduates,
the most common jobs are lab tech, data analyst, and manager. Since
the latter jobs are higher paying, the pay gap persists even among
people who majored in biology. The data shows similar gaps for
mathematics majors: Among both genders, data analyst and generic
analyst roles were popular. But men were much more likely to be
found in sexy data scientist roles, and so the average male math
major earns $60,000 a year in his first five years out of school,
while the average female math major earns only $49,182.
Other research has shown that more
of the gender wage gap comes from within-industry gaps than
between-industry gaps.
When I asked Chamberlain why women aren’t
getting those higher-paying industry jobs, despite their
qualifications, he said his data didn’t indicate a reason. It could
be driven by the behavior of the job seeker. Perhaps men feel
pressured to find and take the highest-paying job they can get,
while women think holistically about work-life balance and
flexibility. Perhaps companies are fast-tracking men into
prestigious, higher-paying roles. Or perhaps companies are being too
narrow in what they’re looking for. For instance, if you’re trying
to hire a data scientist and you tell your recruiter to look only at
statistics majors, you’ve immediately narrowed your pool of
applicants to mostly men. If companies looked at skills rather than
credentials, they might find that there are women trained in
sociology, biology, or anthropology who are just as handy with a
spreadsheet.
Continued in article
Law School Bubble Bursts: As hard as it is to believe, some of these
lawyers lied
Inside Higher Ed: Law Schools Flagged for Job Data ---
https://www.insidehighered.com/news/2016/11/01/initial-audit-finds-flaws-some-law-school-employment-reporting-practices?mc_cid=16d4a56a74&mc_eid=1e78f7c952
"NY Times: A
Majority Of Law Schools Are Scamming Students And Taxpayers,"
by Paul Caron, TaxProf Blog, October 25, 2015 ---
http://taxprof.typepad.com/taxprof_blog/2015/10/ny-times-a-majority-of-law-schools-admit-unqualified-students-charge-outrageously-high-tuition-and-s.html
Law Schools 2011-2015
Enrollment, Faculty Down 60%, Tuition Up 40%
http://taxprof.typepad.com/taxprof_blog/2016/02/cooley-craters-60-drop-in-enrollment-faculty.html
Trustees at Indiana Tech in Fort Wayne have voted to close the
institution's law school at the end of June 2017 ---
https://www.insidehighered.com/quicktakes/2016/11/01/indiana-tech-shutter-law-school?mc_cid=16d4a56a74&mc_eid=1e78f7c952
The Future Is ‘Bleak’ For Law Students And Law School Graduates ---
http://abovethelaw.com/2016/05/the-future-is-bleak-for-law-students-and-law-school-graduates/?rf=1
Legal education has been getting bad press since
the start of the Great Recession, and perhaps for good reason. While tuition
skyrocketed, often leaving graduates with six-figure debt loads, quality job
prospects seemingly disappeared. The jobs that were left had salaries that
were too low to service those graduates’ tremendous debt loads. Prospective
law students began to hear about new lawyers’ joblessness and indebtedness,
and stopped applying. This prompted many law schools to lower their
admissions standards in the hope of filling their seats. This, in turn,
brought about wave after wave of record-setting failure rates on bar exams
nationwide.
Now that class sizes are smaller, employment
statistics seem to look “better,” and law school administrators across the
country have started spreading the word that law school is once more a good
investment. But is it really?
Law students and graduates have started using
Whisper, an
anonymous messaging service, to tell the world about legal education and
what it has done to them. These messages are representative of the general
tone of posts having to do with law school.
Continued in article
Bob Jensen's threads on the rise and fall of law schools ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#OverstuffedLawSchools
The Best 50 Colleges for African Americans ---
http://time.com/money/4282512/best-colleges-essence-money-african-americans/?xid=newsletter-brief
Jensen Comment
Virtually all the very top non-profit universities now offer totally free
education applicants below the poverty line. Most also offer free tuition for
children of families earning less than $60,000 or thereabouts. These are the
best deals since top grades are easy to earn in those
universities like Harvard and Princeton (think grade inflation where the
median grades in most courses is an A or A-) and degrees from those top
universities are keys to the kingdom ---
http://faculty.trinity.edu/rjensen/Assess.htm#RateMyProfessor
Most flagship state-supported universities now make terrific deals to African
Americans with high SAT or ACT scores. Since virtually all scholarships are need
based children from low income families are given priorities for scholarships.
African American athletes get tremendous financial deals, special tutors, and
other attractions such as a path toward professional sports in colleges that
excel in athletics. However, athletics and scholastic performance do not mix
well in general. This is mostly because athletics takes so much time and
attention away from courses, although sometimes athletes have attitude problems
regarding study and scholarship.
Since the latest affirmative action Supreme Court decision, colleges are not
supposed to have affirmative action in admissions and retention. Most colleges
and universities get around this ruling in one way or another to both attract
and keep African American applicants. But the numbers are still too small,
especially for African American male high school dropouts who think they can
earn higher incomes on the mean streets. That is such a shame.
One reason is that it's such a shame is that African American graduates in
science and professional programs have a tremendous edge in affirmative action
hiring and financial support for graduate studies. The AICPA, for example,
offers $12,000 per year for minority accounting doctoral students. Accounting
doctoral programs generally are tuition free for all students in such programs
such that the $12,000 can be used for living expenses.
Application period now open (until May 16) for $12,000 AICPA Fellowship for
Minority Doctoral Students Other Than Asians ---
https://www.thiswaytocpa.com/education/scholarship-search/fellowship-minority-doctoral-students/?utm_source=mnl:cpald&utm_medium=email&utm_campaign=14Apr2016
Applicants should also contact the KPMG Foundation for additional opportunities
to study for an accounting Ph.D. ---
http://www.kpmgfoundation.org/
Some universities cooperating with the KPMG Foundation have tailor-made
accountancy Ph.D. programs for minority students other than Asians.
Bloomberg: Best Undergraduate Business Schools of 2016
---
http://www.bloomberg.com/features/2016-best-undergrad-business-schools/?cmpid=BBD041916_BIZ&utm_medium=email&utm_source=newsletter&utm_campaign=
. . .
We based our
ranking on four main metrics
(see full
methodology):
Employer Survey (40 percent of total score):
Feedback from recruiters who hire recent business graduates on how
well schools prepared students for jobs at their companies.
Student Survey (35 percent):
Students' own ratings of the campus, career services department,
and faculty and administrators.
Starting Salary (15 percent):
The base compensation of students who had jobs lined up, adjusted
for salary variation across industries and regions.
Internship (10 percent):
The percentage of a school’s graduates who had at least one
internship at any time during college.
Continued in article
Jensen Comment
The Bloomberg rankings differ from surveys like the reputed US News
survey that depend more heavily upon deans and thus more heavily on
research reputations of faculty in the business school rankings. Also I
think US News relies more heavily on SAT or ACT scholastic test
scores ---
http://colleges.usnews.rankingsandreviews.com/best-colleges/rankings/business-overall
Some of Bloomberg's top 10 undergraduate programs do not make the top 10
in the US News rankings.
For example, Bloomberg gives top 10 undergraduate business school
honors to Villanova, Boston College, and Bentley that are not in the
US News top 10.
Accounting programs are probably best viewed at the graduate level
where most employment takes place. I don't think Bloomberg ranks
accounting schools, but the latest outcomes from US News are at
http://colleges.usnews.rankingsandreviews.com/best-colleges/rankings/business-accounting
Here we see some key differences in the top 10 accounting schools
versus undergraduate business schools such as with USC, Illinois, and
Florida.
Interestingly, MIT comes off the top ranking in accounting vis-a-vis
business rankings. Personally, I don't think MIT's claim to fame is its
undergraduate accounting program relative to other Boston accounting
programs such as those at Boston College and Bentley. MIT comes off
ranked at Number 2 in the US News Undergraduate business school rankings
---
http://colleges.usnews.rankingsandreviews.com/best-colleges/rankings/business-overall
USA Today: Ten Top Accounting Programs ---
http://college.usatoday.com/2016/02/26/top-colleges-for-accounting/
. . .
1. Bentley University
The accountancy department is the oldest
department at Bentley University, and has a long tradition of
providing a high-quality accounting education. Classes in cost
accounting, auditing, financial accounting and information
technology help to provide a core understanding of the business
world and the role accounting plays in it. Accounting is one of the
most popular majors in the school, and it is no wonder as graduates
are often highly successful in their careers, earning an average
starting salary of $51,000 and mid-career salary of $99,000.
2. University of Notre Dame
The Mendoza College of Business at the
University of Notre Dame is a top-tier business school, combining a
liberal arts education with advanced knowledge and research in
accounting to provide students with a strong understanding of the
field.
Students take specialized classes in
strategic cost management, audit and assurance services and federal
taxation among others to help develop critical thinking and
leadership skills. Graduates of the accountancy program have a solid
grasp of the field and find careers within the accounting industry
earning an average mid-career salary of $119,000.
3.
Bryant University
Founded
in 1863, Bryant University has a
strong history of producing
professionals who are leaders in
the field. Its accounting
program is no exception.
Classes
in leadership, financial
reporting, taxation, auditing
and management introduce
students to the business world,
while improving communication
and analytical skills. Graduates
of this program have a dynamic
understanding of accounting and
are prepared for a career in a
challenging field. They
typically earn an average
starting salary of $52,000
and mid-career salaries of
$80,000.
4. New
York University
The
Leonard N. Stern School of
Business
at New
York University offers two
different undergraduate degrees
in accounting, one with an
emphasis in C.P.A., and the
other less technical in nature.
The second option allows
students to blend liberal arts
classes with core business and
accounting classes to give them
a broad education in the field.
A B.S
in accounting from Stern leads
to a high
average starting salary of
$65,000.
Graduates
of this program often progress
to positions of leadership,
earning an average mid-career
salary of $114,000.
5.
University of Illinois
at Urbana-Champaign
Accounting is a global field
that plays a core role in all
business functions. A degree
from the University of Illinois
at Urbana-Champaign will prepare
you for a successful career at
any organization. The
undergraduate program
is
centered on preparing graduates
for a career in a variety of
accounting fields, ranging from
corporate to governmental.
Students are exposed to the
fundamental principles of
accounting, while learning how
to apply current best business
practices. The curriculum
integrates liberal arts classes
with core business classes in
management, finance and
analytics to create an
environment that enhances
critical thinking skills.
Graduates of this program have
been highly successful in the
business world, earning an
average mid-career salary of
$100,000.
6.
University of Southern
California
The
Marshall School of Business at
the University of Southern
California houses the
distinguished Leventhal School
of Accounting. This
undergraduate accounting program
is one of the best in the
country due to the exclusivity
of the program. Students study
the art of accounting, while
understanding the role it plays
in business. They have the
ability to customize their
major, so they are taking
classes that prepare them for
quick advancement in the
business world.
Classes
in finance, economics and
management help promote
discussions about accounting
practices, while supplementing
classes on accounting
principles.
USC graduates of the accounting
program earn an average
starting salary of $55,000, but
typically advance quickly, to an
average mid-career salary of
$110,000.
7. The
University of Texas-Austin
In
addition to offering a Bachelor
of Business Administration (BBA)
in accounting, the McCombs
School of Business at the
University of Texas also has an
integrated
Master in Professional
Accounting (iMPA) program
that allows strong students to
earn both an BBA and MPA in five
years.
Students can choose a corporate
track or a financial
institutions track, depending on
their desired career plans. Upon
graduation, accounting majors
typically accept jobs in
industry or government with an
average
starting salary of $51,000.
8. CUNY
Bernard M. Baruch College
The
Zicklin School of Business at
CUNY Bernard M Baruch College is
a highly-ranked business school
with a reputation of providing a
quality accounting education.
The school attracts top faculty
that have developed a curriculum
that exposes the relationship
between accounting and other
crucial business practices.
Students take core classes in
cost accounting, financial
accounting, auditing and
taxation along with electives in
areas such as corporate finance
and business law. A degree from
Baruch leads to well-paying
jobs, with graduates earning an
average mid-career salary of
$89,000.
9.
Boston College
Boston
College is a top school known
for its strong curriculum and
the success of its graduates.
The accounting department holds
the same reputation due to its
world-class faculty and
collaborative classes.
Accounting majors take their
core business classes in
finance, taxation, economics,
analysis and auditing at the
Carroll School of Management.
They are given the option to
specialize in Accounting,
Accounting Information Systems
or Corporate Reporting. Each of
these concentrations is
challenging and prepares
graduates for rewarding careers
in a variety of accounting
services, earning an average
mid-career salary of $109,000.
10.
Villanova University
The
Villanova University School of
Business offers an accountancy
program that prepares students
for careers at business firms,
corporations and governmental
organizations. The school has a
dynamic curriculum that
incorporates theory and
principles with exposure to
current business practices. This
gives students the opportunity
to gain a well-rounded business
education and secure jobs after
graduation.
Classes
in accounting, auditing and
taxation are supplemented by
electives in areas such as
fraud, international accounting
and accounting for real estate.
Villanova graduates
are
well-equipped for an accounting
career, earning an average
starting salary of $55,000 and
mid-career salaries averaging
$107,000.
US News Ranking of Top Accounting Undergraduat Programs ---
http://grad-schools.usnews.rankingsandreviews.com/best-graduate-schools/top-business-schools/accounting-rankings
#1
Overall Score:
|
University of Texas—Austin (McCombs)
Austin, TX |
$32,298 per year (in-state,
full-time); $48,832
per year (out-of-state, full-time)
|
#2
Overall Score:
|
University of Pennsylvania (Wharton)
Philadelphia, PA |
$62,424 per year (full-time)
|
#3
Overall Score:
|
University of Illinois—Urbana-Champaign
Champaign, IL |
$21,974 per year (in-state,
full-time); $32,974
per year (out-of-state, full-time)
|
|
#4
Overall Score:
|
University of Chicago (Booth)
Chicago, IL |
$61,520 per year (full-time)
|
#5
Overall Score:
|
Stanford University
Stanford, CA |
$61,875 per year (full-time)
|
#6
Overall Score:
|
Brigham Young University (Marriott)
Provo, UT |
$11,620 per year (LDS
member, full-time); $23,240
per year (Non-LDS member,
full-time) |
#7
Overall Score:
|
University of Michigan—Ann Arbor (Ross)
Ann Arbor, MI |
$54,450 per year (in-state,
full-time); $59,450
per year (out-of-state, full-time)
|
#8
Overall Score:
|
New York University (Stern)
New York, NY |
$60,744 per year (full-time)
|
#9
Overall Score:
|
University of Southern California (Marshall)
Los Angeles, CA |
$51,786 per year (full-time)
|
#10Tie
Overall Score:
|
Indiana University—Bloomington (Kelley)
Bloomington, IN |
$25,500 per year (in-state,
full-time); $44,460
per year (out-of-state, full-time)
|
#10Tie
Overall Score:
|
University of North Carolina—Chapel Hill (Kenan-Flagler)
Chapel Hill, NC |
$34,015 per year (in-state,
full-time); $52,470
per year (out-of-state, full-time)
|
Jensen Comment
The USA rankings lean toward universities in big cities where starting
salaries are somewhat higher but living costs are much higher than than
say living costs in Utah and surrounding mountain states. Exceptions
include Bryant, Illinois and Notre Dame, but these universities feed
nearby urban centers.
I favor the US News report that is influenced more heavily by
opinions of administrators that, in turn, are more influenced by
reputations of accounting faculty. The US News anointed universities
have more stars.
Following Starbucks' lead, JetBlue employees will now get free college
education in the online Arizona State University program
"JetBlue Will Pay Employees’ College Tuition Upfront," by Corinne Ruff,
Chronicle of Higher Education, April 18, 2016 ---
http://chronicle.com/article/JetBlue-Will-Pay-Employees-/236144?cid=at&utm_source=at&utm_medium=en&elqTrackId=2c1186cfd9b341cb9c63ee9ed19e27b4&elq=ff4810688471400f82f0d34fb98b721c&elqaid=8697&elqat=1&elqCampaignId=2932
The program is the latest
company-and-college partnership
that takes cues from the Starbucks College Achievement Plan —
a program,
created in 2014, that allows employees of the coffee-shop chain to take
online classes at Arizona State University while continuing to work at the
company.
But
there’s a key difference between the JetBlue program and many other
partnerships in the Starbucks-Arizona State model.
Most of the programs either reimburse tuition costs or offer discounts,
requiring employees to foot at least some of the bill for their courses. But
JetBlue employees won’t pay anything upfront: The company will cover the
full cost of an associate degree.
To
earn a bachelor’s degree, however, students would have to cover the $3,500
capstone course at Thomas Edison State, either out of pocket or through a
scholarship.
In
August the company started a pilot version of the program with 200 employees
with at least two years’ seniority and with at least 16 credits from an
accredited college or university already in hand.
Bonny W. Simi, president of the subsidiary JetBlue Technology Ventures, says
that employees had long asked for tuition reimbursement, but that the
company wanted to go a step further and foot the whole bill.
‘Success Coaches’ Are Assigned
As interest grows
in the
unbundling of higher education
— the use of just
the learning material from the college experience — Ms. Simi says the
JetBlue program was made possible by the flexibility and affordability of
competency-based education.
"We’ve mapped out degrees so that it’s basically higher ed but stripped away
are the cafeterias, the football team, the big campuses, the dorm, and
everything," says Ms. Simi, who oversees the program. "It’s just the class."
Continued in article
Jensen Comment
There are other free or highly subsidized college programs paid for by employers
such as the huge Wal-Mart program with American Public University, but the
Starbucks and JetBlue programs have the most prestigious diplomas in my opinion.
"News Analysis: Is 'Wal-Mart U.' a Good Bargain for Students?" by Marc
Parry, Chronicle of Higher Education, June 13, 2010 ---
http://chronicle.com/article/Is-Wal-Mart-U-a-Good/65933/?sid=at&utm_source=at&utm_medium=en
Following Starbucks employee education benefits with Arizona State
University,
Anthem Blue Cross offers education benefits with the University of Southern New
Hampshire
"Fiat Chrysler Offers Degrees to Employee Families
(including families of dealer employees) ," Inside Higher Ed,
November 23, 2015 ---
https://www.insidehighered.com/quicktakes/2015/11/23/fiat-chrysler-offers-degrees-employee-families?utm_source=Inside+Higher+Ed&utm_campaign=b3c3eb755f-DNU20151123&utm_medium=email&utm_term=0_1fcbc04421-b3c3eb755f-197565045
"An Increasingly Popular Job Perk: Online Education,"
by Mary Ellen McIntire, Chronicle of Higher Education, June 2, 2015 ---
http://chronicle.com/blogs/wiredcampus/an-increasingly-popular-job-perk-online-education/56771?cid=wc&utm_source=wc&utm_medium=en
Bob Jensen's threads on fee-based distance
education ---
http://faculty.trinity.edu/rjensen/CrossBorder.htm
Of course there are thousands of free online education
and training courses available from prestigious universities such as Stanford,
MIT, and top Ivy League universities. But transcript credits are not free for
students who want credits for MOOCs on their transcripts. Of course prices are
much lower than onsite attendance credits ---
http://faculty.trinity.edu/rjensen/000aaa/updateee.htm#OKI
Added Jensen Comment
What I think is the most interesting trend in what might be termed
competency-based courses and degrees is the lowering of the bar on admissions
standards. Virtually anybody can take these newer online cheaper and/or
subsidized courses with grades awarded on the basis of competency examinations
while taking the courses. In comparison, students admitted on site to
universities like Harvard and Stanford and Arizona State University face higher
admission standards. But with grade inflation in virtually all on-site campuses
(now having median grades of A-) the standards for competency are much lower, in
my viewpoint, than the competency-based online courses
via MOOCs that dare not become shams with grade inflation.
The bottom line is that the competency standard for Harvard University and
Stanford University is being admitted to study on campus. The competency
standard for getting transcript credit for their MOOC courses is . . . er . . .
er . . . demonstrated competency in the subject matter.
If you want to make a Harvard University onsite
student or an ASU onsite student wet his pants make him accept the online
competency-based tests for the course he just received an A or B grade in from
his professor on campus.
Arizona State University is now under enormous
pressure not to make the corporate-subsidized online degrees truly
competency-based and not grade-inflated shams.
-
How to Mislead With Statistics
Here's how much surgeons, lawyers, and 18 other top-earning
professionals make per hour ---
http://www.businessinsider.com/hourly-salaries-surgeons-lawyers-doctors-2016-11/#-1
Jensen Comment
This articles is one of the best/worst articles I've seen lately on how
to lie with statistics.
Here are a few things to point out to your students if you want to
highlight how not to report survey results.
First and foremost when you define the total populations (apart from
sample sizes) and don't mislead about the sizes of the populations.
For example, the above article says there are 24,000 employed
psychologists and 15,650 physicists. Aren't professors and other
teachers in these fields "employed?" There are more employed specialists
in these disciplines employed only in academia than the numbers shown
above. Most likely the average hourly wage would
be greatly pulled down if academics were included in the population and
the sample.
Secondly the article ignores standard deviations and kurtosis of the
distributions from which averages are reported. For example, outliers in
millions of dollars of compensation to attorneys and other professionals
tend to skew averages upward. Even medians can be misleading for highly
skewed distributions with outliers on both sides of the medians.
Think of the lawyers who will work for food.
How random are the samples from the populations identified in the
study. My guess is not very random.
Watch definitions.
What is a "chief executive?" The manager-owner of our local hardware
store is a "chief executive" as is the CEO of a Fortune 500 Corporation.
What's the definition of a "financial manager versus a "sales manager?"
Why are there twice as many financial managers as sales managers?
What's the definition of "public relations and fundraising managers" and
why are there only 60,380 of them when there are 531,161 financial
managers? Many financial managers and chief executive officers and are
also the public relations and fund raising managers. My guess is that
the sampling population totally ignored public relations and fund
raising managers for colleges, universities, churches, and charities
where compensation is often quite low or contingent upon funds raised.
What's the difference between a pharmacist and the chief executive.
Many pharmacists also own and manage the entire drug store?
What's "compensation?" Most CEO's of Fortune 500 companies get paid
on performance-based contracts depending upon such things as corporate
earnings reports. In other words what a CEO makes one year may be
doubled or tripled the next year and then taken way down the following
year.
What's "compensation?" Most CEOs are paid in many ways including
stock options, stock awards programs, living benefits (use of the
corporate jets and ski chalets), wine, women, and song.
There's an enormous difference between what
a physician makes before or after malpractice insurance and other
expense expenses. Those that work for much lower annual salaries often
do not have to pay their own malpractice insurance, nurse expenses,
receptionist expenses, accounting expenses, office rental expenses, etc.
I could go on and on, but I think students will catch my drift.
This article is so misleading it's worse
than garbage.
How to Mislead With Statistics
"This graph shows how much money you
can earn from each college major," by Abby Jackson, Business
Insider, December 24, 2015 ---
http://www.businessinsider.com/earning-potential-by-college-major-2015-12
Jensen Comment
This graph is a great illustration of an interactive graphs, although
you have to play around with it some to get the hang of it. For example,
if you want to see the graphs for just "Accounting" click off the box
for "All," click the box for "Accounting," and then scroll down and
click on "Apply."
By now many of you are weary of my
warnings about such things as definitions, averages without standard
deviations, skewness (kurtosis), etc. For example, means or medians for
"accounting" can be misleading without knowing how accounting is
defined. For example, there's a big difference between what lowly
bookkeepers make versus CPA firm partners and executives in major
corporations. There's a huge difference between what accounting Ph.D.
graduates make in struggling small private colleges versus what they
make at Ivy League universities. Also there's a huge difference in
fringe benefits such as housing subsidies, research stipends, summer
pay, and fringe benefits such as contributions to TIAA/CREF. Also Ph.D.
graduates tend to have opportunities for outside income in book writing
and consulting. At a prestigious university like Harvard, a professor's
Harvard salary is likely to be only a small part of total income.
In general, the biggest problem is in
career tracking combined with income standard deviations. Comparing the
lifetime earnings of a cost accountant in General Electric cannot really
be compared with the lifetime earnings of a partner in a small local
public accounting firm really cannot be compared because some of these
partners may top out at $50,000 or more per year whereas others top out
at $500,000 per year after their retirement buyouts are factored into
compensation.
A top accounting graduate typically goes
to work for 5-10 years with a large public accounting firm or the
government. However, 80% or more of those graduates leave (most never
intended to stay in public accounting or government employment) and go
to work for in private industry such as when an IRS agent goes to work
at a high level in a corporate tax department. At such time they often
make much more than others who stay in public accounting or government.
The problem is that in studies like the one cited above these "former"
accountants are no longer classified as
accountants such as when a public accountant becomes the CFO or
CEO of a large or small corporation. Hence in studies like the one above
a former accountant is excluded from the 20-year survey of
"accountants."
The same problem arises when examining
accountants who only have "associates" degrees. Typically these
accounting graduates are no longer "accountants" ten or 20 years out.
Some may be CEOs of their own companies and some might earn over
$200,000 per year in stores or plumbing companies that they own. Hence,
I'm extremely suspicious of graphs that compare
the benefits of getting a Ph.D. versus an associates degree in
accounting. The problem is that most associates or
bachelors degree holders either dropped out of the labor market (such as
to have babies) or became entrepreneurs who are no longer classified as
"accountants."
Problems like those mentioned above
become exacerbated when comparing types of degrees such as accounting
versus culinary arts versus creative writing.
Conclusion
The bottom line is that studies like this are so misleading and
dangerous that I wish they did not get published.
Bob Jensen's threads on careers are
at
http://faculty.trinity.edu/rjensen/bookbob1.htm#careers
For a list of job boards
for accountants see
http://maaw.info/AccountingJobBoards.htm
"14 Things High Schoolers Should
Know Before They Go To College," by Vivian Giang, Business Insider,
July 16, 2013 ---
http://www.businessinsider.com/what-young-people-should-know-before-going-to-college-2013-7
The Muse (free job hunting site) ---
https://www.themuse.com/
PwC US Launches CareerAdvisor, January 7, 2015
New platform of tools to provide students with resources they need for
the career they want
http://www.pwc.com/us/en/press-releases/2015/pwc-us-launches-careeradvisor.jhtml
USA ACCOUNTING ENROLLMENTS CONTINUE UPWARD TREND, REACH ALL-TIME HIGH
"2015 Trends in the Supply of Accounting Graduates and the Demand for
Public Accounting Recruits," AICPA, 2015
The 2015 edition of Trends in the
Supply of Accounting Graduates and the Demand for Public Accounting
Recruits is a publication of the results of a long-standing American
Institute of CPAs survey.
The survey, published since 1971,
identifies key trends in accounting enrollment, as well as
graduation and hiring. This report, covering the 2013–14 academic
year, provides estimated information and forecasting regarding the
supply of and demand for new accounting graduates within the public
accounting sector to various stakeholders and interested parties.
In the 2013–14 academic year,
enrollment in accounting programs reached an all-time high after a
year of rapid growth — a 19% increase for master’s degree
enrollments and a 3% increase in bachelor’s degree enrollments.
Master of Accounting programs of both public and private
universities saw major growth in enrollment — with 23% and 50%
increases in enrollments this period, respectively — while there was
a smaller increase (12%) of enrollments in Bachelor of Accounting
programs at private universities and a 22% decrease in bachelor’s
degree enrollments at public universities.
Total bachelor’s and master’s
degrees in accounting awarded in the 2013–14 academic year remained
steady with a less than 1% decline after reaching an all-time high
in the 2011–12 academic year. Master’s degrees awarded increased by
31%, while bachelor’s degrees awarded decreased by 11%.
Hiring also reached record levels
after 7% growth in all new hires. Master’s degree hires saw the
largest growth, with an 11% increase since 2012. Over the same time
period, bachelor’s degree hires increased 5%. As a percentage of
total hires in 2014, however, new hires with bachelor’s degrees
increased 3 percentage points, new hires with master’s degrees
decreased 6 percentage points, and total nonaccounting hires
increased 2 percentage points since the previous reporting period.
As a percentage of new hires, those assigned to accounting/auditing
decreased 4 percentage points while assignment to taxation increased
by the same amount.
Universities and firms are both
optimistic about the growth of the profession — 97% of bachelor’s
programs and 70% of master’s programs expect their enrollment to be
the same or higher than the previous year. Additionally, 91% of
firms expect their hiring of new accounting graduates to be higher
than or the same as the previous year. Larger firms are especially
optimistic about future hiring with all large firms employing over
200 CPAs forecasting the same or more new hires in every area next
year.
The gender distribution of
professional staff at all firms is now 52% male and 48% female. The
reported race/ethnicity distribution changed with the White
race/ethnicity category increasing 10 percentage points, the
Asian/Pacific Islander race/ethnicity category decreasing 9
percentage points, and the Black/AfricanAmerican race/ethnicity
category decreasing 2 percentage points. The gender distribution of
partners also showed a significant shift, with a 5 percentage point
increase in female partners between 2012 and 2014.
The AICPA is very appreciative of
the universities and firms who took the time to participate in this
year’s survey. Please contact us at trends@aicpa.org with any
questions or feedback as we strive to make the information in these
surveys relevant to your needs.
"The Economic Guide To Picking A College Major," by Ben
Casselman, Nate Silver's 5:38 Blog, September 12, 2014 (slightly
dated) ---
http://fivethirtyeight.com/features/the-economic-guide-to-picking-a-college-major/
Jensen Comment
This is a better-than-most article article on this topic, although
virtually all such articles are misleading in terms of long-term versus
short term reasons for choosing a major. For example, some of the
highest paying careers at the point of graduation are not great careers
in terms of long-term opportunities for professional growth or lifetime
income. Accounting and finance, for example, are typically ranked low in
terms of average starting salaries but rank high in terms of economic
opportunities. In part this is because accounting and finance graduates
are neophytes who have minimal expertise that comes with experience and
post-graduate learning (usually on the job). They have a lot of learning
to do before they can earn their keep.
One strong point of the article is that it lists number of majors in
each discipline broken down into quartiles. This is important because
numbers reflect the fact that there are both opportunities and job
competition due to high versus few numbers of majors. For example, there
are over 200,000 nursing majors and nearly 200,000 accounting majors.
This suggests that demand for these majors must be relatively widespread
with considerable choices of location both in urban and rural
settings across the USA. Those disciplines having less than 1,000 majors
perhaps have much less choice with respect to number of employers and
geographic locations.
The article is weak in terms of showing the incremental advantages of
getting advanced degrees. For example, the physical sciences are not
usually great undergraduate majors without going into some type of
graduate study. Some majors require at least masters degrees for taking
the licensing examinations for a career. Thus comparing these majors
with majors that only require undergraduate degrees is a little like
comparing apples and oranges.
Also some majors that used to be great in terms of income and
opportunity have fallen onto hard times. Law schools, for example, are
now graduating twice and many majors relative to career opportunities in
law.
Also some majors are much less specific in terms of job skills. For
example, graduates in business management have wide ranging skills (or
lack thereof) relative to accounting, pharmacy, and engineering majors
that require many more specialized courses in a curriculum --- partly
due to the way certification examinations dominate curricula for some
majors like accounting, pharmacy, and engineering but not business
management. My point is that the subset of business management majors is
such a heterogeneous subset I'm not certain what starting salary
averages really mean in this diverse population.
My main recommendation is that starting salaries should be given much
less consideration than other factors going into a career. For example,
I personally would never have considered physical therapy as a major,
because I think physical therapy over the course of 50 years on the job
must be terribly boring and generally lacks growth opportunity. Some
careers like K-12 teaching lack growth opportunities buy offer
considerable independence in terms of free time with summer vacations
and holidays that add up to a lot of free time in a lifetime career.
free time for example to raise children.
For me, being a professor in a university turned into what I think
has to be the best of all careers as long as becoming wealthy is not a
priority in life. The main advantage is independence choosing how to
spend your time on and off the job. There are of course other types of
non-monetary rewards in helping students learn and develop their own
lives. My research and scholarship had great variety over the years and
was not nearly as dull as you might think when the word "accountancy" is
mentioned as an academic discipline.
Women in Science ---
http://www.womeninscience.org/
PBS: SciGirls ---
http://pbskids.org/scigirls/
The Untold History of Women in Science and Technology ---
http://www.whitehouse.gov/women-in-stem
Affirmative Action Favors Women, Blacks and Latinos Over Whites and Asian
Males in Science Tenure Track Hiring
"Advantage Women,," by Colleen Flaherty," National Academy of
Sciences via Inside Higher Ed, April 14, 2015 ---
https://www.insidehighered.com/news/2015/04/14/study-suggests-stem-faculty-hiring-favors-women-over-men
Many studies suggest that women scientists
aspiring to careers in academe face roadblocks, including bias --
implicit or overt -- in hiring. But a new study is throwing a curveball into the literature,
suggesting that women candidates are favored 2 to 1 over men for
tenure-track positions in the science, technology, engineering and
math fields. Could it be that
STEM gender diversity and bias awareness efforts are working, or
even creating a preference for female candidates -- or is something
more nuanced going on? Experts say it’s probably both.
Wendy M. Williams, professor of human
development at Cornell University, and Stephen Ceci, the Helen L.
Carr Professor of Developmental Psychology at Cornell, are no
strangers to complicating research on gender bias in STEM. In a
2010 paper in the
Proceedings of the
National Academy of Sciences, for example, they argued that
women’s life choices, whether voluntary or constrained, better
explain women’s underrepresentation in STEM than the usual suspects
of discrimination in journal and grant reviewing and hiring. (They
argued such biases were things of the past, and that efforts to
address them missed the real source of the problem.)
Continued in article
38 Percent Of Women Earn More Than Their Husbands," by Mona
Chalabi, NPR via Nate Silver's 5:38 Blog, February 8, 2015 ---
http://fivethirtyeight.com/datalab/38-percent-of-women-earn-more-than-their-husbands/
Bob Jensen's threads on affirmative action in academe ---
http://faculty.trinity.edu/rjensen/HigherEdControversies2.htm#AffirmativeAction
"Hiring and enrollments reached record highs last year," by Courtney
L. Vien, Journal of Accountancy, August 10, 2015 ---
http://www.journalofaccountancy.com/news/2015/aug/public-accounting-firm-jobs-hiring-201512792.html#sthash.0OtpJ7X4.dpuf
Unlike many in their Millennial cohort who face continued
underemployment, accounting graduates find themselves in high
demand from employers. Top students are often recruited, offered
jobs during or after their internships, and enticed with signing
bonuses.
According to the AICPA report Trends in the Supply
of Accounting Graduates and the Demand for Public Accounting
Recruits, hiring at public accounting firms jumped 7% to
reach record levels in 2013–14. Ninety-one percent of all firms
said they expect to hire accounting graduates at the same or
higher levels in 2015.
- See more at: http://www.journalofaccountancy.com/news/2015/aug/public-accounting-firm-jobs-hiring-201512792.html#sthash.0OtpJ7X4.dpuf
Unlike many in their Millennial cohort who
face continued underemployment, accounting graduates find themselves
in high demand from employers. Top students are often recruited,
offered jobs during or after their internships, and enticed with
signing bonuses.
According to the AICPA report Trends in the
Supply of Accounting Graduates and the Demand for Public Accounting
Recruits, hiring at public accounting firms jumped 7% to reach
record levels in 2013–14. Ninety-one percent of all firms said they
expect to hire accounting graduates at the same or higher levels in
2015.
Continued in article
"Medicine, Law, Business: Which Grad Students Borrow The Most?"
NPR,
July 15, 2015 ---
Click Here
http://www.npr.org/sections/money/2015/07/15/422590257/medicine-law-business-which-grad-students-borrow-the-most?utm_source=facebook.com&utm_medium=social&utm_campaign=npr&utm_term=nprnews&utm_content=20150715
Hint: Except for the outliers the correlation with starting
salaries is less than I would have expected. However, the outliers
increase this correlation. In some fields, especially business, the
variance in lifetime earnings is much greater.
Partial Quotation from the Article
Students studying medicine and law
typically borrow more than $100,000 to get through school, and many
go on to high-paying careers.
At the other end of the spectrum, many
Ph.D. students wind up in academia. Most get grants and subsidies —
and the majority don't have to borrow any money at all to get
through grad school.
One striking case: MBAs. People who go to
business school take on significantly less debt than people at other
professional schools. Most MBA programs are two years long — shorter
than law school (three years) or med school (four).
But that's not nearly enough to explain the
difference.
Jensen Question
I have a granddaughter who recently graduated in pharmacy with
enormous debt. It's not clear why pharmacists in general graduate
with more debt than most other graduates outside of medicine. In her
case the reason was that she chose an expensive small private
college well beyond the means of her family for so many years.
Her brother is now entering the University of Maine system
intent of a nursing career. He has much more fear of debt than his
sister. This is the main reason his undergraduate degree will cost
so much less before he goes on to graduate school. As valedictorian
of his high school class he also earned a scholarship of $1,000 per
year for any college of his choosing.
Bob Jensen's threads on student debt ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#StudentDebt
Concerns Over Shortage of Competent Accounting Recruits
"Staffing issues surge to forefront of accounting firm concerns," by
Jeff Drew, Journal of Accountancy, June 9, 2015 ---
http://www.journalofaccountancy.com/news/2015/jun/accounting-firm-issues-201512451.html
It’s been a long time, but U.S. accounting
firms are again dealing with a full-fledged talent shortage.
That’s one of the main takeaways from the
2015 Private Companies Practice Section (PCPS) CPA Firm Top Issues
survey, which found staffing issues leading the list of concerns for
accounting firms of all sizes except sole proprietors.
Finding qualified staff ranked as one of
the two most pressing issues for all firms with more than one
professional, topping the list for firms with two to 10
professionals and ranking second among firms with 11 or more
professionals (see chart below). Firms in the two largest size
categories (11–20 professionals and 21+ professionals) named staff
retention as their No. 1 concern.
Continued in article
"The Fields That Students Flock to During Recessions," by Josh
Zumbrun, The Wall Street Journal, July 16, 2015 ---
http://blogs.wsj.com/economics/2015/07/17/the-fields-that-students-flock-to-during-recessions/
Graduating into a recession stunts the
careers of the young men and women entering the labor market. But it
turns out a lot of students don’t sit back and passively accept this
outcome: Many students who see a recession during their early
college years switch to majors with better job prospects.
According to
new research from Benjamin
Keys at the University of Chicago, Brian
Cadena at the University of Colorado Boulder
and Erica Blom at Edgeworth Economics,
the shifts can be dramatic.
When the national unemployment rate rises
by 1 percentage point, the share of women studying business rises by
nearly two-thirds of a percentage point. The share of women studying
nursing climbs by nearly a third of a percentage point. An
additional quarter percentage point switch into accounting.
Meanwhile, enrollment in education, literature and languages,
sociology and psychology drops.
Jensen Comment
Accounting ranks number three from the top. It may well be on the top if
it did not take five years (150 selective credits) and a certification
examination to become a CPA. It is true that accounting firms are always
hiring when the economy goes up or down. However, in public accounting
there's a lot of forced turnover before employees are eligible to become
partners. The secondary market declines somewhat for accountants who do
not become partners after working in CPA firms for 5-10 years.
The low-ranking fields tend to be low ranking in boom or bust in the
economy. Also many high-ranking fields like nursing are high ranking in
boom or bust.
The 10 Best and Worst Undergraduate Majors for Getting Jobs (without
getting additional credentials) ---
http://www.businessinsider.com/worst-college-majors-2014-6
Top students in the "worst majors" in the past often went on to law
school. They are still doing so but in fewer numbers and greatly
dampened prospects for working in law firms after law school graduation.
Law school losses of students are often MBA program gains. Options in
accounting, engineering, nursing, pharmacy are not so great due to all
the undergraduate prerequisites that must be satisfied before going to
graduate school in those specialties.
Because there are so many graduates in business, neither an
undergraduate degree nor an MBA degree is a very good path to a career
without extremely high grades or specialties in demand like accounting.
Sometimes a combination of degrees greatly improves job prospects such
as an undergraduate engineering or computer science degree topped off
with an MBA from a top school.
Students planning to get MD or science Ph.D. degrees need to
carefully plan their undergraduate studies in advance of going to
graduate school. Unfortunately, graduate studies in those fields,
especially medicine, can be quite long and expensive. For example, most
MD or science Ph.D. graduates must also plan for low-paying
post-graduate residency or post-doc years before they can make
significant progress in paying down their student loans.
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
From the Chronicle of Higher Education
Search for the Latest Job Openings in any Discipline of Interest
---
https://chroniclevitae.com/job_search/new?cid=VTECHNJOBSL1
Jensen Comment
When I search for "Accounting" and "Faculty & Research" today there are
256 jobs posted in the past 30 days. However, not all of these jobs seem
property classified as both "Accounting" and "Faculty & Research." Also
I know of some job openings for accounting professors that are not
listed for major universities.
For persons seeking jobs as accounting faculty in the USA perhaps a
better place to look might be the American Accounting Association Career
Center ---
http://aaahq.org/Career-Center
Job seekers may also post their resumes at this center.
Since there are so many faculty vacancies in accountancy, job seekers
with Ph.D. degrees from AACSB-accredited universities are advised to
contact colleges and universities where they would most like to be
employed.
Bob Jensen's threads on the higher education
faculty job market ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingFaculty
Academic careers
--- http://www.academiccareers.com/
LibraryCareers.org ---
http://www.ala.org/ala/educationcareers/careers/librarycareerssite/home.cfm
Careerzone ---
http://careerzone.ny.gov/cz/stem/index.jsp
-
-
Engineer Your Life
(engineering careers and education) ---
http://www.engineeryourlife.org/
-
-
Map: The Most Common Job in
Every State (changing times 1978-2014) ---
http://www.npr.org/blogs/money/2015/02/05/382664837/map-the-most-common-job-in-every-state
JobApps ---
http://www.myjobapps.com/
The Muse (free job hunting site) ---
https://www.themuse.com/
Careers in Logistics ---
http://academic.rcc.edu/logisticsmanagement/PDF/Careers In Logistics by
CSCMP.pdf
Resume Writing Helpers and
Samples --- http://www.resumesamples.info/
-
My Next Move (career change helpers) ---
http://www.mynextmove.org/
For example feed in the word "accountant"
Science Careers ---
http://sciencecareers.sciencemag.org/
Accounting Career Network ---
http://www.searchaccountingjobs.com/
AccountingCareersNow.com ---
http://www.accountingcareersnow.com/
The Big Four Accounting Firms Are All in the Ten: Who dares say
that accounting is a dull career?
"Fifty Most Popular Employers for Business Students," Bloomberg
Businessweek, May 9, 2013 ---
http://images.businessweek.com/slideshows/2013-05-09/fifty-most-popular-employers-for-business-students
"How To Get Hired If You Have
A Tattoo," by J.T. O'Donnell, Business Insider, October 22,
2013 ---
http://www.businessinsider.com/how-to-get-hired-if-you-have-a-tattoo-2013-10
NASA Women of STEM ---
http://www.nasa.gov/education/womenstem/
"38 Percent Of Women Earn More Than Their Husbands," by Mona
Chalabi, NPR via Nate Silver's 5:38 Blog, February 8, 2015 ---
http://fivethirtyeight.com/datalab/38-percent-of-women-earn-more-than-their-husbands/
Jensen Comment
I don't know how this study factored for misleading statistics, but here are a
few considerations. It's quite common for women to support husbands who are
students such as students or residents in medical school. For example, surgical
residents get paid, but they get paid very little relative to what their wives
may be still earning to support the completion of their husband's training
requirements. Of course sometimes it is husbands who support aspiring female
physicians.
Many men are in the USA military. Their wives who work are almost
certain to have higher income, although the benefits of a military are
substantial --- including free family medical care, base housing, base
schools, and lifetime pensions commencing at a young age, sometimes
before reaching 40 years of age.
Times are changing for professional women at work. The big CPA firms
now hire more female accounting graduates than male accounting
graduates. There are also cracks in the glass ceiling. Deloitte, one of
the top Big Four firms, just appointed a woman CEO.
Bob Jensen's threads on the history of working women ---
http://faculty.trinity.edu/rjensen/bookbob2.htm
Jensen Note
Entry level accountants are usually called "staff accountants." Upon
graduation some of the most plentiful jobs in the world are for staff
accountants. Note that in the USA, however, CPA firms generally require
that students become qualified to immediately take the CPA examination,
and that generally takes a fifth year of study, usually but not always
for a masters degree. The same can be said for chartered accountants in
many other nations.
Staff Accountants are in the Top Ten Below
"10 jobs with the best salary potential," Jada A. Graves, US News
& World Report, February 3, 2015 ---
http://www.businessinsider.com/jobs-with-the-best-salary-potential-2015-2
Jensen Comment
Also important is job-change opportunity. Many college graduates go to
work for CPA firms never intending to stay with those firms. Those firms
offer terrific opportunity for technical training and exposure to
clients needing accounting, internal auditing, forensics, information
technology, and tax services. More often than not those that leave the
CPA firms and stay in the work force go with clients.
Salaries may or may not be higher, but there is often less travel and
job stress when working for a client. Making partner with a CPA firm
often entails long hours and public relations skills requiring special
talents. Partners are paid well, but less than 15% of the new hires in
large CPA firms become partners. Partners generally have skills in
obtaining and retaining clients. The same, by the way, is true of law
firms where much of the technical work is often performed by lower-paid
non-partners.
My point is that students hoping to become partners in CPA firms and
law firms should take courses in communications. Foreign languages can
also help since sometimes the path to partnership is easier for USA
accounting graduates to work in off shore offices of multinational CPA
firms such as working in offices in Moscow, Mexico City, and various
cities in South America and Asia.
From the Chronicle of Higher Education
Search for the Latest Job Openings in any Discipline of Interest
---
https://chroniclevitae.com/job_search/new?cid=VTECHNJOBSL1
Jensen Comment
When I search for "Accounting" and "Faculty & Research" today there are
256 jobs posted in the past 30 days. However, not all of these jobs seem
property classified as both "Accounting" and "Faculty & Research." Also
I know of some job openings for accounting professors that are not
listed for major universities.
For persons seeking jobs as accounting faculty in the USA perhaps a
better place to look might be the American Accounting Association Career
Center ---
http://aaahq.org/Career-Center
Job seekers may also post their resumes at this center.
Since there are so many faculty vacancies in accountancy, job seekers
with Ph.D. degrees from AACSB-accredited universities are advised to
contact colleges and universities where they would most like to be
employed.
How to Mislead With Statistics
Unemployment by Occupation 2014 ---
http://247wallst.com/investing/2015/01/16/unemployment-by-occupation-2014/
Jensen Comment
Here are a few reasons why unemployment statistics can be misleading:
- Workers often leave jobs voluntarily who virtually cannot be
fired. For example federal and state civil service employees often
leave to enter higher paying jobs in the private sector or to become
full-time parents, but try firing a civil service employee who is
performing terrible on the job or is a chronic absentee at work
- Workers who are vulnerable at early stages of employment often
become locked into job security with seniority or tenure. Examples
include K-12 teachers and college professors.
- Unemployment rates can be misleading indicators of job
availability. For example, physical scientists may have low
unemployment rates but a Ph.D. degree in a physical science
discipline does not open many doors to a job as a full-time
professor or scientist in general. There's an old joke about how
many geologists can fit into a pickup truck. The answer is only two
with their lawnmowers.
- Unemployment rates vary greatly with location. For example,
employment as a welder is almost guaranteed for welders seeking work
in oil fields and along pipeline construction, but try finding job
as a welder in tens of thousands small rural towns in the USA.
- Employment varies with willingness to take on risks. For
example, it's very common for some jobs to compensate on a sales
commission basis with very little pay guarantees. This often leads
to high unemployment rates in some jobs that are relatively easy to
find because of compensation risks.
The bottom line is that unemployment rates can be very misleading
when choosing an intended career. There are many, many more important
criteria.
How to Mislead With Statistics
The 15 College Majors With The Lowest Starting Salaries ---
http://www.businessinsider.com/college-majors-with-the-lowest-starting-salaries-2015-1?op=1
Jensen Comment
This a in some cases a little misleading such as when careers entailing
12-months on the job with two weeks paid vacation are compared with
others entailing 9-months on the job with an added 8+ weeks paid
vacation. The latter careers with five months free are especially
popular for parents having or expecting young children at home.
Starting salaries are not nearly as important as career growth and
enjoyment of the work. For example, some employees will take lower pay
to work with children or to work in biblical studies. Careers that have
little variation in routine over decades can become very boring. I think
physical therapy might be interesting for a time but can become very
boring over 40+ years.
Keep in mind that these rankings are based on averages that in some
cases have varying standard deviations. For example, law graduates may
have higher averages but many start out at very low salaries as clerks
or lowly-paid interns.
"Don't Rely On Salary Data To Pick A Programming Language
(career): To Learn Current demand says nothing about earnings
potential," by Matt Asay, ReadWriteWeb, November 28, 2014 ---
http://readwrite.com/2014/11/28/programming-language-salary-data-dont-mix
Jensen Comment
This is good advice in general, not just good advice for programmers. I
always advised my graduating accounting students not to be mislead by
higher starting salaries. I told them to instead look at prospects for
training, experience, and exposure to great clients, clients that will
often hire them into terrific jobs after they have on-the-job skills.
As a matter of fact higher salaries can be very misleading if you
ignore living costs.
For example, CPA firms will often pay more to graduates who will locate
in San Francisco, Manhattan, Honolulu, etc. But the cost of living in
those cities overwhelms the higher compensation. A lower salary in Des
Moines or San Antonio end up being more in terms of compensation net of
living costs. But even even then compensation should not be the deciding
factor. Look at other things vital to career and happiness in life.
Also don't look at happiness in life to make short term decisions. I
very nearly took my first teaching job in Gunnison, Colorado because I
wanted to ski and raise horses. At the time this would have been a dead
end choice that entailed heaving teaching loads and no research support.
Plus as a hot dog skier I would probably be long dead by now.
PS
I still have a friend in Houston who makes a good living programming in COBOL.
"These Are The Highest Paying Programming Languages You Should Learn,
Ranked By Salary," by Lisa Eadicicco, Business Insider, November 20,
2014 ---
http://www.businessinsider.com/best-tech-skills-resume-ranked-salary-2014-11
. . .
Based on that data, here are programming
languages listed next to their average annual salary from lowest to
highest:
12. PERL - $82,513
11. SQL - $85,511
10. Visual Basic - $85,962
9. C# - $89,074
8. R- $90,055
7. C - 90,134
6. JavaScript - $91,461
5. C++ - $93,502
4. JAVA - $94,908
3. Python - $100,717
2. Objective C - $108,225
1. Ruby on Rails -
$109,460
While some of these coding languages can
help you earn around $100,000, train to become a Salesforce
Architect if you want one of the highest paying jobs in tech.
According to
data from IT recruiting firm Mondo that was published back in March,
Salesforce Architects can earn anywhere between $180,000 and
$200,000.
Jensen Comment
After spending all that part of my life learning and teaching Fortran
and COBOL I'm no longer needed. Sigh!
Question
What large CPA firms came out very well in this gender ranking?
Three of the Big Four multinational accounting firms are
among the very top companies of the the world for working moms at Ranks 4/100,
5/100, 8/100
And all four are in the 15-year Hall of Fame for working moms
---
https://www.workingmother.com/working-mother-100-best-companies-winners-2019
The Big Four firms are among the very best companies to work for in
general at Ranks 26/100, 34/100, 36/100, and 44/100
---
https://fortune.com/best-companies/
Bob Jensen's threads on the history of working women ---
http://faculty.trinity.edu/rjensen/bookbob2.htm#Women
"B-Schools Finally Acknowledge: Companies Want MBAs Who Can Code," by
Cory Weinberg, Bloomberg Businessweek, July 11, 2014 ---
http://www.businessweek.com/articles/2014-07-11/b-schools-finally-acknowledge-companies-want-mbas-who-can-code
Jensen Comment
One question is whether this is mostly a filtering criterion or a genuine
criterion for hiring. For example, some popular business schools require
students to complete two courses in calculus before matriculating as
undergraduate business majors. It's not so much that calculus is a prerequisite
for business courses as it is that calculus weeds out the dummies.
It's doubtful that many Big Four partners can code.
More important are perceived trustworthiness and going the extra mile in
client relations. In my opinion, most partners are the ones visible in
public service (such as volunteer work for communities), work pro bono a
lot of nights and weekends, and play a lot of golf with clients and
prospective clients. I used to belong to a downtown bridge club in
Bangor, Maine. A senior partner in a law firm who belonged to that club
told me that his job was to get the clients that were served by his
technical staff. Some partners with marginal devotion devotion to
religion are extremely active in their churches, mosques, and
synagogues. My point --- for partners it's the extra hours of the week
building relationships outside the office that really count.
"The qualities of a Big Four partner: Chris Carter, Crawford
Spence and Claire Dambrin studied Big Four firms in three countries to
find out what qualities make a partner," Economia, July 16,
2014 ---
http://economia.icaew.com/finance/july-2014/essay-the-qualities-of-a-big-four-partner
The Big Four are quintessentially global
organisations, their logos adorn major commercial centres and they
are prominent players in most western economies. Unlike their
corporate counterparts, their governance structures are more opaque.
This is a consequence of the partnership model which gives a high
degree of independence to each country in which the Big Four
operates. Global organisations –in general – and the Big Four in
particular invite the following question: to what extent is there
convergence or divergence between their operations in different
countries?
We set out to answer this question by
researching partners in Canada, France and the UK. We were
particularly interested in the types of people that became partner
and the process of them actually getting there. Was this similar
across the three countries or were there striking differences?
The broad career structure is much the same
across the three contexts: following qualification, employees move
into the manager position – during which time many tend to leave the
firm – before proceeding to senior manager, director and ultimately
partner. Only 2-3% of members of the Big Four will ever make
partner; ascension to this position is to enter the elite of the
accounting profession. In provincial cities, Big Four partners are
well known “business celebrities”, while in capital cities they are
players within their service lines. Partners are the pinnacle of the
accounting profession for those that remain in private practice.
We started by looking at British and
Canadian partners. What we found was remarkably similar: it takes
most partners 15-17 years to become a partner after joining; 60 to
70 hour weeks are the norm; partners are more likely to be white and
male; the process of becoming a partner has become far more
formalised than it was in the past; most people who make partnership
highlight the importance of “having a good mentor” to help them
navigate the complex, Byzantine politics of a Big Four firm.
To add to this picture, interviewees
emphasised the importance of trust: does the firm trust a candidate
enough to make them a part-owner? All of this takes place against a
broader economic backdrop which will determine whether a particular
service is deemed worthy of supporting a further partner. The
economic conditions can in boom times create more partnerships in a
firm; recessionary times can preclude gifted candidates from making
partner.
We talked to over 50 partners, ex-partners
and people who didn’t make partner in Britain and Canada. The
similarities far overshadowed any differences. Partners were very
much “self-made men” and, save for a few exceptions, were drawn from
modest social backgrounds. This meritocratic quality was deeply
infused within the firms we visited, with a notable ‘can do’ ethos.
The driven quality of the partners often extended to their leisure
pursuits. Whereas the stereotype is of a partner playing a good deal
of golf, they were much more likely to be competing in endurance
cycle races or long distance running events. The participation in
endurance sports is a fitting metaphor. Partners are driven, high
energy people who exude self-confidence.
By midway through our research we were
accustomed to partners recounting that “their career was different”.
This statement surprised us as most of the partners spent most of
their careers in one firm, something that is very unusual in the
contemporary workplace, and we imagined that there was a distinct
career path. The expression, however, spoke to the different ways in
which the partners had proved themselves.
In every case, the accountant “proved
themselves” through completing a difficult piece of work that gained
praise from the firm. This demonstrated that the accountant had
ability and could be trusted by the organisation. This building of
reputation brought the accountant into new networks in the firm
where more opportunities arose. Proving oneself as being very good
at a complex job is generally enough to get a promotion to director.
Beyond that, wannabe partners need to demonstrate that they can move
effortlessly with senior executives in client firms and that they
can generate revenue. It’s a cliché, but cash is king. The Big Four
are packed full of extremely competent technical specialists – what
makes someone stand out is their ability to generate fee income.
Entrepreneurialism is a prime quality.
The similarities between British and
Canadian partners were striking regarding this topic, in fact the
only compelling difference was that British partners went for
football and rugby metaphors, while their Canadian counterparts used
ice hockey and NFL.
We travelled to France to find out about
the French experience. Our intuition was that the capacity to
generate new business would be crucial there too but that leverages
to increase turnover might be of a different nature. In particular
we expected that belonging to a cultural or social elite would be
essential for partners to bring in new business in France. The Big
Four are similarly prominent in France, although there are different
rules around audit rotation. What became immediately clear was the
Big Four are structured differently in France.
First, it was incredibly important where an
employee had studied. In France, there are a number of Grandes
Ecoles that are, in effect, elite Business Schools. The Big Four
strive to recruit a quota from each of these schools. Unlike in
Britain, where the Big Four recruit from a wide range of
universities and where partners are pretty diverse in terms of their
educational backgrounds, in France attending one of these Grande
Ecoles will vastly increase your chances of getting recruited in the
first instance, and is even more important in rising to partner
grade in the second instance. One of our French partners explained:
“We are worried when we don’t have enough ‘parisiennes’ [graduates
of top Grandes Ecoles]. I find that daft but in this firm we always
have the illusion that if you haven’t been to a ‘parisienne’ then
you can’t be a partner. That said, given that the clients of
tomorrow will have studied at the same place, it is better to have
them.”
The quote reveals a great deal about how
educational background is a determinant of future success in the Big
Four in France. Simply put, having graduated from a top school (a
parisienne) marks out an employee as special and puts them onto a
different career trajectory from those who had attended more routine
universities. In France Big Four firms agree with each other on
starting salary grids depending on the school category of their
recruits. High expectations are placed very early on their recruits
from Grandes Ecoles and this has a very basic economic rationale.
It is through the process of offering
parisiennes more varied and exciting work – projects that add value
and generally “pampering” them – that their “specialness” becomes a
reality in the French Big Four. Contrary to what we expected,
educational pedigree actually becomes more important at the partner
level: it is easier for graduates of the Grandes Ecoles to interact
with each other and so future sources of revenue will come through
the conversion of their educational background into social skills
and new business for the firm. It is a fascinating contrast to the
British and Canadian experiences where the treatment of recruits is
much more homogeneous. More broadly, the French experience is
suggestive of the grip that Grandes Ecoles have on elite careers
within the French corporate sector.
The Grandes Ecoles cast a long shadow over
the Big Four in France; this raises questions as to whether a
different set of qualities are required to become partner. A key
insight from our research study is that the pressures that French
partners and aspirant partners face are much the same as in Britain
and Canada: clients need to be kept happy; new business needs to be
generated and delivered; new service lines need to be developed; for
personal career strategies, aspirant partners need to be seen as
less technical and more strategic.
In short, the descriptions of the Big Four
in France were remarkably similar to their counterparts in Britain
and Canada. What was particularly striking was the creed of
commercialism that underpins the Big Four across the three
countries. One partner in France explained: “The first thing we look
at is [the candidate’s] commercial skills. Dilution [of
profit-per-partner] is a real concern for us. If partners don’t
bring in revenue, the partners’ committee will lose money because
there is less to share in the end. So the capacity to make business
grow obviously matters a lot.”
This quote could have come from any of the
firms in any of the three countries. The ability to generate
business and ‘grow the cake’ is an absolutely central skill for
someone who wants to make partner. The central difference between
Britain, Canada and France is that in the French case the assumption
is that being a graduate of a Grandes Ecoles will help generate new
business. In Britain and Canada it is demonstrably not the case that
an elite degree will lead to these outcomes. In France, attendance
at one of these schools has a huge bearing on an alumnus’s future
career in the Big Four.
Our research emphasises that people skills
– the ability to get on with people and build durable networks – are
crucial to success in a Big Four career. These skills need to be
converted into revenues. To put this in some sort of context, the
following revenues were quoted to us. In Canada, one interviewee
suggested that a partner needed to generate around $3m (Canadian)
per annum (£1.63m), in France this figure was estimated at €3m
(£2.4m), whereas in Britain, a figure of £2m was frequently cited.
Partners are clearly under pressure to generate vast sums of fee
income for the Big Four; the prospect of being able to generate such
fees is crucial to ascending to a partnership.
Continued in article
See more at:
http://economia.icaew.com/finance/july-2014/essay-the-qualities-of-a-big-four-partner#sthash.BukvhkPO.dpuf
"Women's Career Choices Don't Explain the Gender Pay Gap," by Natalie
Kitroeff and Jonathan Rodkin, Bloomberg Businessweek, November 14, 2014
---
http://www.businessweek.com/articles/2014-11-14/women-make-less-than-men-even-when-they-are-equally-qualified-mbas
High-achieving women are paid less than men
even when they have similar levels of experience and are in the same
fields, according to new Bloomberg Businessweek data. Women
graduating business school this year reported an average of $14,548
less in expected annual pay than men, graduating MBAs said in a
survey of 9,965 students at 112 schools, conducted as part of our
recently published biennial
ranking of MBA programs.
Part of the reason women overall earned
less is that they were more likely to go into fields with
below-average salaries, like consumer products and advertising. But
even within the same fields, women were paid less than men. Indeed,
17 of 22 industries that hired MBAs last year offered women less
money. Women entering finance earned, on average, close to $22,000
less than men, the largest pay differential among companies that
drive MBA hiring. Women were offered $12,300 less by tech companies,
and $11,500 less by consulting firms than their male peers.
The analysis continues a debate that pits
those
who
cite discrimination as the reason American
women earn 77 cents to a man’s dollar against
others
who
argue
women make less because they opt for
lower-paying jobs than men, work fewer hours, and interrupt their
careers to have children. When you account for those factors, they
say, the pay gap all but disappears.
It may be true that over the course of
their lives, women make choices that cost them at work. So it’s
useful to analyze the pay difference at a career moment when they’re
both highly qualified and available to work. Women graduating from
top MBA programs are usually in their late twenties or early
thirties and have just sunk over $100,000 into a degree, presumably
to raise their value to employers—just like their male counterparts.
We limited this analysis to people who had full-time jobs lined up;
so there was no gender difference in their commitment to working a
full day. Even with those things being equal, the pattern held.
Without looking at the individual
circumstances of the women in the survey, it’s hard to know whether
there’s something about them besides their gender that could knock
their pay after graduation, like how many years of work experience
they had before their MBA. One data point in our survey, however,
helps get at the question of experience: whether they graduated into
the same industry as the one they were in when they started their
MBA.
Career-switchers should, in theory, be on a
level playing field. A man entering a new industry straight out of
an MBA program has the same amount of experience in that industry
(none) and the same level of education as a woman in the same
situation. Yet women who were switching into tech, finance, or
consulting—the three industries that hire the most MBAs—made an
average of $12,800 less than men who were also newbies. Men who were
in one of these jobs before business school, and stayed the course
after graduating, made $13,300 more than women on the same path.
The postgraduation gap also wasn’t
explained by the fact that women, on average, were making less than
the men to start with. When we controlled for people’s compensation
before getting to campus, the gap narrowed, but didn’t disappear.
Women made about $8,500 less than men upon graduating regardless of
what they were pulling in beforehand.
Our data suggest that employers pay certain
people less not because of their reproductive choices or penchant
for low-paying gigs, but because they are women.
Continued in article
"Women with MBAs from Elite Schools Are More Likely to Drop Out of the
Workforce," Harvard Business Review Blog, November 19, 2014
Married mothers who are
graduates of elite business schools are 30
percentage points less
likely to be employed full-time than mothers who are graduates
of less-selective B-schools, according to a study by Joni Hersch
of Vanderbilt Law School. The reasons are unclear, but women who
hold MBAs from selective schools may have high family incomes,
which allow them to take time off from work to raise children.
Their lower levels of labor-market participation may have the
effect of limiting the number of women reaching high-level
corporate positions, because elite workplaces prefer to hire
MBAs from elite schools, Hersch says.
SOURCE: Opting
Out Among Women with Elite Education ---
http://links.mkt3142.com/ctt?kn=12&ms=OTk1NDAyMAS2&r=MTkyODM0MDg0MAS2&b=0&j=NDIxNTY1NzA4S0&mt=1&rt=0
The Third Wave of Feminism (Gender Studies)
http://faculty.trinity.edu/rjensen/HigherEdControversies2.htm#Feminism
Bob Jensen's threads on the history of professional women ---
http://faculty.trinity.edu/rjensen/bookbob2.htm#Women
How to Mislead With Statistics
"The 10 Best Jobs For 2015," by Jacquelyn Smith, Business Insider,
November 20, 2014 ---
http://www.businessinsider.com/best-jobs-for-2015-2014-11?op=1
. . .
Marketing Executive
Software Developer, Applications
Registered Nurse
Industrial Engineer
Network and Computer System Administrator
Web Developer
Medical and Health Services Manager
Physical Therapist
Speech-Language Pathologist
Continued in article
Jensen Comment
The above article is terrible in many respects.
- The biggest failing is that it does not define "best jobs." There are
many criteria for "best jobs." Best can be defined in terms of starting
compensation packages, demand versus supply, mobility (e.g., are the jobs
only available in larger urban centers or are they available in rural areas
across the USA), amount of overnight travel required, promotion
opportunities and career paths, nature of the compensation (fixed salary
versus bonuses versus sales commissions) etc.
- The article does list "growth potential" as an annual percentage growth
in compensation, but this is highly misleading. In some careers the
inflation-adjusted compensation is asymptotic. The growth in compensation
for a Registered Nurse or a Physical Therapist may be 5% per year for the
first few years, but the after adjusting for inflation the growth potential
is likely to be asymptotic as it approaches the high end in that career. A
CPA or computer program may work for a firm for five years and then go to
work for a client at double or triple compensation rates.
- The article mixes executive jobs like Marketing Executive, Network and
Computer System Administrator, and Medical and Health Services Manager with
non-executive jobs like Registered Nurse, Physical Therapist, and
Speech-Language Pathologist. There are usually entry jobs available for
Registered Nurse, Physical Therapist, and Speech-Language Pathologist, but
nobody graduates after four years expecting to get job offers as a Marketing
Executive or a "Manager" of anything.
- Some job categories are too vague in terms of a high degree of variance
in opportunity and compensation. For example, Web Developers are a dime a
dozen with extremely high variance in opportunity and compensation.
- In my opinion, the "best jobs" at the time of graduation are those with
high demand, on-the-job-training, and client/customer exposures that will
lead to huge opportunities down the road. The starting salary is very low in
importance if a job offers tremendous opportunity for training and career
advancement. For example, a new CPA in a large accounting firm usually
receives very extensive training and exposure to clients that will offer
tremendous job offers down the road. A Registered Nurse, Physical Therapist,
and Speech-Language Pathologist may end up doing pretty much the same thing
for 40+ years.
- For men or women with family responsibilities some jobs can be performed
heavily without leaving the home or children. For example, many CPA firms
now let workers work from home computers a very large share of the work
week. This is usually not the case for a all of the above supposed "best
jobs" other than possibly a "Web Developer."
- I'm confused why "Industrial Engineer" beats out other types of
engineers in the above ranking. Most rankings that I have seen before list
the Chemical Engineers and Electrical Engineers well above Industrial
Engineers. Civil Engineers don't fare as well.
I could go on and on lambasting the above article. but perhaps you get the
idea by now.
How to Mislead With Statistics: Ignore the Variance and Ignore the
Outliers (in this case graduates without law jobs)
"Why Huge Salaries Don't Necessarily Make Law Grads Rich," bv Akane Otani,
Bloomberg Businessweek, October 22, 2014 ---
http://www.businessweek.com/articles/2014-10-22/law-school-grads-make-good-salaries-but-have-high-debt-and-few-jobs
Graduates of Harvard Law School,
among all the graduate schools in the U.S., make the most money,
earning a median salary of $201,000 once they are 10 years out of
school, according to a new report. Law schools rank higher than
other graduate programs when it comes to salaries, yet skyrocketing debt and
a
thinning job market for law graduates may
dampen the appeal of a J.D.
Harvard Law School, Emory University School
of Law, and Santa Clara University School of Law topped salary
rankings for graduate and professional
programs in a study released Wednesday by compensation-tracking
company PayScale. Of the top 20 schools, 12 were law schools. The
rest were business schools.
Despite a few law schools dominating the
rankings, law school graduates did not hold claim to the most
lucrative degree on the market. The median midcareer salary for a
law school graduate was $139,300—a far smaller sum than the figures
boasted by the schools that topped PayScale’s rankings.
Considering that the median debt load for law school graduates
rose to
$140,616 in 2012, even a six-figure salary doesn’t sound as
glamorous.
What’s more, Payscale’s data didn’t factor
in law school grads who don’t have jobs—and jobs are scarcer for
lawyers now than they have been in years. The employment rate for
law school graduates has
dropped
six years in a row. “Since 1985,
there have only been two classes with an overall employment rate
below [84.5 percent], and both of those occurred in the aftermath of
the 1990-91 recession,” the National Association for Law
Placement said in a
report
this summer. Over the past decade,
at least 12 firms, accounting for more than 1,000 lawyers, have shut their
doors. Others are eyeing cuts
among partners.
One reason why a J.D. isn’t a
get-rich-quick guarantee is the wide range of salaries within the
field of law. A new graduate working as a public interest lawyer or
for local government will make an average of $60,000 or less a year,
according to the
NALP.
“If you want to be a public defender vs. a
corporate attorney, there is going to be a big difference in terms
of ability to pay off your loans,” says Lydia Frank, editorial and
marketing director for PayScale. “Because there’s such a wide
variety in earnings potential, you can’t assume that any job you’re
going to pursue with a J.D. is going to be equal.”
While the salary rankings may provide a
good benchmark for what’s possible with an elite law degree, great
job connections, and a lucrative specialty, the average would-be
lawyer should think carefully about the return on an investment in
legal education.
“If you’re going to take out ‘X’ amount in
student loans, you really want to have a good understanding of the
likelihood of being able to repay that loan in a timely fashion,”
Frank says. “I think it still behooves everybody to really examine
things other than salary potential, such as employment potential for
JDs.”
Jensen Comment
Traditionally, accounting graduates who go to work for large CPA firms
get great training and great client exposure. The bad news is that
probabilities of attaining partnerships after 6-10 years are very low.
The good news is that prospects of going to work for clients are high,
and new graduates never wanted the pressures, travel, and time
commitments of partnerships in CPA firms in the first place.
Among the least-wanted pressures are the pressures to obtain new
clients via lots of night and weekend community volunteer work, golf
outings that aren't all that much fun, and selling the firms' services
over and over and over year after year Some of the things that
discourage faculty from striving to be college presidents also
discourage staff accountants and lawyers from seeking partnerships.
My point is that winnings of the highest salaries as partners
in both law and accounting firms are not all they're cracked up to be in
terms of job stress, long hours, frequent travel, glad-handing, broken
marriages, neglected children, etc. Most of the very good lawyers and
accountants want no part of this partnership lifestyle even at much
higher compensation. Men and women partners who are also parents are
advised to have spouses who will take on the chores of child rearing and
keeping the home fires burning.
A bummer for finance and marketing graduates is performance-based
compensation. For example, landing that job on Wall Street sounds great
until you realize that your pay is really based upon sales commissions.
It's not a great life unless you really like to spend your days wooing
customers to buy what you're selling (like bonds and derivatives) year
after year after year.
"Where the Jobs Are," Inside Higher Ed, April 23, 2014 ---
http://www.insidehighered.com/quicktakes/2014/04/23/where-jobs-are#sthash.NKe4NhNO.dpbs
A new analysis of available jobs finds that
the highest demand (among openings for college graduates) is for
white-collar professional occupations (33 percent) and science and
technology occupations (28 percent). The analysis -- by the
Georgetown University Center on Education and the Workforce -- is
consistent with that center's past research, in finding many more
opportunities for those with a bachelor's degree than for those
without a college degree.
The new study is based on online job
advertisements. The most in-demand
professional jobs are accountants/auditors
and medical/health service managers. In STEM, the most in-demand
jobs are for applications software developers and computer systems
analysts.
Jensen Comment
There's a bit of mixing of apples and oranges here. The study says it
looks at bachelor's degrees. But in in order to take the CPA exam
accountants and auditors mush have 150 credits which for most graduates
translates to a masters degree. Also many medical/health service
programs are graduates of masters of health care administration programs
such as the graduate health care administration program at Trinity
University.
In some cases like chemistry and biology the job prospects with a
bachelor's degree are mostly lousy McJobs. But those majors have an edge
for being admitted to graduate programs, especially medical schools,
where opportunities abound upon graduation.
For those rejected for graduate schools or who cannot afford graduate
schools, career opportunities are probably better in the skilled trades
such as those $150,000 - $200,000 welding jobs.
Bob Jensen's career helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
America's Best Companies to Work For ---
http://247wallst.com/special-report/2014/08/07/236519/12/
Jensen Comment
Among the largest CPA firms, only EY made this listing.
In general, a company on this list may have wide variation of "best"
local offices. For example, among CPA and large consulting firms like
Accenture, a firm not on the list may have a better local office than a
firm on the list. Graduating students should tune in closely to alumni
in local offices. Client exposure in a local office is exceedingly
important for career opportunity, training, and satisfaction. Thus any
two employees in a given local office may have vastly different
evaluations of their jobs at a given time and over an extended period of
time. Most of the companies in this listing have enormous local offices
in major cities. Sometimes small is better.
"Welders Make $150,000? Bring Back Shop Class Taking pride in learning to
make and build things can begin in high school. Plenty of jobs await," by
John Mandel, The Wall Street Journal, April 21, 2014 ---
http://online.wsj.com/news/articles/SB10001424052702303663604579501801872226532?mod=djemMER_h&mg=reno64-wsj
In American high schools, it is becoming
increasingly hard to defend the vanishing of shop class from the curriculum.
The trend began in the 1970s, when it became conventional wisdom that a
four-year college degree was essential. As Forbes magazine reported in 2012,
90% of shop classes have been eliminated for the Los Angeles unified school
district's 660,000 students. Yet a 2012 Bureau of Labor Statistics study
shows that 48% of all college graduates are working in jobs that don't
require a four-year degree.
Too many young people have four-year
liberal-arts degrees, are thousands of dollars in debt and find themselves
serving coffee at Starbucks SBUX +1.10% or working part-time at the mall.
Many of them would have been better off with a two-year skilled-trade or
technical education that provides the skills to secure a well-paying job.
A good trade to consider: welding. I recently
visited Pioneer Pipe in the Utica and Marcellus shale area of Ohio and
learned that last year the company paid 60 of its welders more than $150,000
and two of its welders over $200,000. The owner, Dave Archer, said he has
had to turn down orders because he can't find enough skilled welders.
According to the 2011 Skills Gap Survey by the
Manufacturing Institute, about 600,000 manufacturing jobs are unfilled
nationally because employers can't find qualified workers. To help produce a
new generation of welders, pipe-fitters, electricians, carpenters,
machinists and other skilled tradesmen, high schools should introduce
students to the pleasure and pride they can take in making and building
things in shop class.
American employers are so yearning to motivate
young people to work in manufacturing and the skilled trades that many are
willing to pay to train and recruit future laborers. CEO Karen Wright of
Ariel Corp. in Mount Vernon, Ohio, recently announced that the manufacturer
of gas compressors is donating $1 million to the Knox County Career Center
to update the center's computer-integrated manufacturing equipment, so
students can train on the same machines used in Ariel's operations.
In rural Minster, Ohio, near the Indiana border,
electrician and entrepreneur Jack Buschur is creating the Auglaize & Mercer
County Business Education Alliance, which will use private-sector dollars to
fund a skilled-trade ambassador to walk the halls of local high schools with
the mission of recruiting teenagers into these fields. This ambassador will
also work to persuade school guidance counselors and administrators to
change their tune that college is the only route to prosperity, and to
encourage them to inform their students about the many opportunities in
skilled trades.
At Humtown Products in Columbiana, Ohio, near
the Pennsylvania border, CEO Mark Lamoncha is coordinating tours for local
high-school guidance counselors to visit his company so that they can learn
about job opportunities in advanced manufacturing and 3-D printing. Rather
than having students seeing posters only for Ohio State, Pitt, Harvard and
Yale in their high-school hallways, he wants to convince the schools'
guidance counselors to also post signs for the Choffin Career & Technical
Center in Youngstown and the New Castle School of Trades in Pulaski, Pa.
The Ohio School Board Association recently heard
a similar message—from the actor John Ratzenberger, whom you might remember
as Cliff Clavin, the mailman from the 1980s sitcom "Cheers." Mr.
Ratzenberger these days is devoting considerable charitable time and dollars
toward raising the profile of America's skilled laborers as role models for
young people.
He began this effort in 2004 with a TV show
called "Made in America," focusing attention on the rewarding labor of
blue-collar workers making everything from Steinway pianos and Wonder Bread
to Caterpillar CAT +1.37% equipment and Chris Craft yachts. Now he's
crisscrossing the country urging schools to invest in vocational education.
On "Cheers," Cliff Clavin never appeared to be overly industrious, but in
promoting the restoration of shop class in U.S. high schools, Mr.
Ratzenberger is working hard to put young Americans in good jobs. Educators
could learn a thing or two from him.
Mr. Mandel is the treasurer of Ohio.
Most of the Fast Growing Jobs in this Decade Do Not Require a
College Education
"I Looked Up The Fastest-Growing Jobs In America, And Boy Was It
Depressing," by Rob Wile, Business Insider, April 7, 2014
---
http://www.businessinsider.com/fastest-growing-jobs-2014-4
Jensen Comment
This study is based upon changes in numbers of employees in each
occupation. Opportunities are much better in some careers having
emerging skills and jobs having high barriers to entry. Opportunities
will abound for psychiatrists who will get soaring increases in
compensation due to continued shortages under the ACA act. The big
barrier to psychiatry is the talent and years of medical school required
combined with a reluctance of many medical school graduates to take on
some of the dangers of being a psychiatrist treating some unstable and
threatening patients.
The study also seems to leave out the shortages of high tech
specialists such as cybersecurity experts, big data analytics, and FBI
computer and white-collar crime experts.
My point is that the rate of growth barrier in many instances is
on the supply side rather than the demand side such that those who
become educated and trained for these unfilled demand jobs (such as
shortages of cybersecurity experts and high-tech weapons development
experts) have great career opportunities. Already many many such experts
are being admitted to the USA on green cards because the numbers of such
experts in the USA are so small relative to demand.
From the CFO Journal's Morning Ledger on April 8, 2014
Corporation cash
finds its way into university curricula
State universities seeking new revenue are partnering with
companies that are trying to close a yawning skills gap in
fast-changing industries, the
WSJ reports. Students at the University of Maryland, for instance, are enrolling
in a cybersecurity concentration funded in part by Northrop Grumman
Corp., and the company is helping to design the curriculum and pay
for part of a new dormitory. IBM last year deepened a partnership
with Ohio State University to train students in big-data analytics.
Jensen Comment
Prospects for auditing, systems, and tax accounting graduates are
expected to remain high. However, in most instances graduates must have
five years of full-time specialty study in college. It's much more
difficult and costly to become a CPA than to become an insulation worker
or health care aid. It's also much more costly and difficult to become a
psychiatrist than a CPA.
"American Bar Association Releases 'Bleak' Jobs Data for 2013 Law
School Grads," by Paul Caron, TaxProf Blog, April 10, 2014
---
http://taxprof.typepad.com/taxprof_blog/2014/04/aba-releases-.html
A Whitehouse Website That Does Work (almost entirely)
College Scorecard ---
http://www.whitehouse.gov/issues/education/higher-education/college-score-card
College
Scorecards in the U.S. Department of Education’s College
Affordability and Transparency Center make it easier for you to
search for a college that is a good fit for you. You can use the
College Scorecard to find out more about a college’s
affordability and value so you can make more informed decisions
about which college to attend.
To start,
enter the name of a college of interest to you or select factors
that are important in your college search. You can find
scorecards for colleges based on factors such as programs or
majors offered, location, and enrollment size
Jensen Comment
Note that at the above site you can also search for a college by name.
Some data like average earnings of graduates is still being compiled by
the Department of Education. Average earnings of graduates will probably
be a misleading number. Firstly, the most successful graduates might
track into other colleges to complete their undergraduate and/or
graduate degrees. Hence feeder colleges may be given too much or too
little credit in terms of earnings success.
Secondly, I think earnings "averages" are misleading statistics
unless they are accompanied by analysis of standard deviations and
kurtosis.
Thirdly, high earnings averages cannot all be attributed to where a
degree is earned. For example, students with stellar SAT scores on
average are more likely to have higher earnings no matter where they got
their undergraduate engineering, science, business or whatever
baccalaureate degrees. Students with low SAT scores may be likely to
earn less in lower paying jobs like elementary school teaching because
of lower academic abilities as opposed to their particular alma maters.
And yes I know that some high SAT graduates who might have made it to
medical school teach first graders because they are dedicated to
teaching and/or want summers free to raise their own children.
Fourthly, a high percentage of college graduates become parents and
full-time homemakers. This might distort earnings statistics unless
somehow factored out of the calculation of averages. However, it's
difficult to factor out in many instances. For example, CPA firms now
hire more female than male graduates from accounting masters degree
programs (undergraduates are not allowed to take the CPA examination).
This will raise a college's average earnings for graduates before a
significant number of those women drop out of the workforce --- often
for only a decade or two before somehow returning to their accounting
careers. In other instances the male spouses they married in college
drop out of their jobs to be homemakers so their traveling wives can
carry on as auditors and tax accountants and accounting information
systems experts. My point is that those starting salaries are not
necessarily for lifelong continuous careers for many mothers or
sometimes fathers.
And there's the problem of debt burdens. Last night our furnace quit
when the temperature was headed toward an 10 degree night. We recently
changed plumbing companies, and a very nice and very skilled young man
arrived on a Sunday night (right after the Patriots clobbered the
Steelers) to instantly identify the part (the controller) that failed on
our furnace. He had a replacement part in his truck.
In the meantime our conversation drifted to the topic of student
loans. We mentioned how our son and his wife both amassed over $60,000
in debt and had to remain at their old jobs after graduating from
college --- meaning their college degrees burdened with debt did not
help them in the least to find better jobs.
Our new plumber then explained how his wife amassed a student debt of
$88,000 which he's now paying off. She has two masters degrees and
cannot find a job. One of these degrees is in political science and the
other is in international relations. If she moved to Boston she could
possibly find work, but the last thing either of them want is to leave
the White Mountains to live in Boston or any other mega city.
I think what he was saying is that before
taking on such heavy student debt she should perhaps have done better
planning about where she wanted to live --- or more importantly where
she did not want to live.
"Prospective Adult Students Miss Key Data on College Options,
Report Says," by Katherine Mangan, Chronicle of Higher Education,
November 4, 2013 ---
http://chronicle.com/article/Prospective-Adult-Students/142815/?cid=at&utm_source=at&utm_medium=en
Most adults who
are considering college—either completing a degree or
starting one for the first time—aren't tapping into the
wealth of information about costs, graduation rates, and job
prospects, and as a result they aren't finding the right
fit, according to a report released on Monday by Public
Agenda, a nonprofit research group.
The
report, "Is College Worth It for
Me? How Adults Without Degrees Think About Going (Back) to
School," says that most prospective adult students worry
about the cost of college and how to balance studies with
families and careers. They're looking for colleges with
practical programs that will help them land jobs, as well as
personalized support from caring faculty members and
advisers.
The report,
which was financially supported by the Kresge Foundation,
was based on a survey this past spring of 803 adults, ages
18 to 55, who lack college degrees but expect to start
earning a certificate or degree in the next two years. The
group, which excludes students coming straight from high
school, accounts for about a third of first-time college
students in the United States, according to the report.
The survey
found that adults ages 25 to 55 have more doubts about going
to college and are less likely to have concrete plans. Those
under 25 worry more about whether they can succeed at
college and land a job afterward.
Continued in article
Bob Jensen's career helpers (and yes
I know education is important for reasons other than a career) ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
This is worthwhile advice to graduating students in accounting and finance
and probably in some other disciplines.
I do suggest that men wear dark suits to an interview with business recruiters
--- and long dark socks, shined shoes, and white shirts.
Dress like you already have the job and are going to be meeting with a client!
I don't have anything against a black suit, but my male and female students
generally preferred dark blue suits.
Their bosses generally prefer pin stripes and are most often seen in vests
rather than suit coats.
"To My Fellow Job-Hunting College Seniors Never wear a black suit to an
interview. Get a Gmail address. LinkedIn? Yes. And write thank-you notes,"
by David Pierce, The Wall Street Journal, March 17, 2014 ---
http://online.wsj.com/news/articles/SB10001424052702303730804579435040049720068?mod=djemBestOfTheWeb_h&mg=reno64-wsj
"I have no idea what I'm doing." This is the
thought that runs through the minds of college students most of the time. As
we begin to look for jobs during our senior year, between bouts of temporary
alcohol-induced amnesia, we start to suspect that our cluelessness is a real
problem. When we find out that the guy who has worn the same Greek function
T-shirt and sunglasses backward around his neck for four years has accepted
a job offer, panic sets in.
At the University of Arkansas' Walton College of
Business, I have diligently learned the CAPM model and inner workings of
financial statements. I can DCF all D-A-Y. But when it came to my job search
I discovered a disconnect between my education and the real world.
So to my fellow generation of entitled
adult-adolescents who expect a $75,000 salary if they're going to get up
before 10 a.m., here's my advice from the other side of the job search. You
won't hear any of this from your college career center.
• Never wear a black suit to an interview.
Black suits are for weddings and funerals. Go to a classy men's boutique
and have them fix you up with a nice $500 suit, gray or navy blue. It'll
last you five years. The key is to make sure it fits so you'll feel
snappy in the job interview despite your stutters and flop sweat. If you
can swing it, buy the gray and the blue suit. Wear the blue for the
first-round interview, and the gray to the more formal second- or
third-round interviews. (Women: Sorry, I'm not qualified to advise on
pencil-skirts and heels.)
• If you get nervous in social situations, make
an effort to go out to a bar—not with your buddies—a few months before
interview season, have a couple of drinks, and strike up a conversation
with an unfamiliar girl (or guy). Bars are low-pressure, and even if you
do get shut down, you'll realize that the rejection isn't that bad. More
important, you'll gain new confidence that will help in higher-pressure
environments such as interviews and networking sessions.
• In networking sessions, don't talk about the
fascinating people you've met or the exotic places you've been if that
information hasn't been strongly solicited by the other person. Better
to talk about your friend who deep-fried an entire bag of Doritos than
the semester you spent at Oxford. You'll get laughs and seem
down-to-earth.
• Don't use your university email on your
resume. Schools often discontinue email addresses, and if an employer
wants to get in touch after graduation you'll be out of luck. Get a
Gmail account with some easy-to-understand form of your name. Note: It's
safe to assume that job interviewers think people with Yahoo YHOO -0.03%
or AOL email accounts are suspect.
• When you get a business card, write on the
back where and when you met the person and any useful notes about him or
her. Keep track of these cards. Personally, I use a spreadsheet for all
the info. Email your contacts—even a few lines—every three or four
months and make sure you have something to say.
• Trying to network with someone in a company
but don't know their email? If you have someone else's email from the
company, follow the format. If an analyst's email is John.Doe@bank.com,
and you want to get in touch with Jane Smith, send the email to
Jane.Smith@bank.com. I have used this trick a few times and it works.
• LinkedIn. Get one.
• Social Media. As you've noticed, parents now
use Facebook FB -0.03% more than we do, and the people who are thinking
about hiring you will probably be parents. Before you start your job or
internship search, reset your privacy settings so that strangers can see
only your profile picture. Choose a presentable photo—no random arm
around you or red Solo cups. Make your Twitter TWTR +0.25% and Instagram
private. Oh, and delete your Myspace if it still exists. Any potential
employer will Google GOOG +1.65% you, so if there's anything floating
around on the Web that you don't want them to see, take it down.
• Set up your voice mail like someone who has a
real job or deserves one. Don't make people sit through even five
seconds of your favorite song or your jokey explanation of why they need
to leave a message. If they're calling to set up a job interview, they
just want to be sure it's you.
• Write thank-you notes for job interviews.
Emails don't cut it, so play it safe and do both. Write and mail the
note the minute you get home.
• Once you accept a job offer, don't talk about
your salary—you'll either sound like you're bragging or you'll discover
that you should have held out for more. An exception: Friends may ask in
earnest, especially juniors, so they can better grasp the job market.
But tell them at your own risk.
• If you've accepted an offer, do everything in
your power to help classmates find a job. Getting an offer means you're
doing something right and probably have at least one valuable piece of
advice to pass along. Share if others ask. You would want someone to do
the same for you.
Don't worry, if you get one or more of these things
wrong, it isn't going to totally kill your chances of landing an internship
or job. And it was probably time to clean up your Facebook anyway.
Mr. Pierce is a senior finance student at the University of Arkansas'
Sam M. Walton College of Business. After graduation, he'll be working as an
investment-banking analyst.
Jensen Comment
Recruiters are hard to predict for interviews, because they often pride
themselves in not being conventional. Most importantly be yourself and be
totally honest especially if questions border on the fringes of politics. But
also be prepared for trick questions. Often it's not the answers that are
important. It's the way you handle yourself when you don't know the answers.
This is a job interview, not a Ph.D. oral examination or an interview for a
faculty job.
I suggest that men and women be prepared to make conversation. In the
interviews keep your questions focused on career opportunities like training and
clients you might be serving. My favorite male and female employees can also
informally talk sports statistics with Nate Silver. It's not like you will be
asked sports questions in a formal interview. But interviewers have been known
to take recruits to lunch.
Like it or not, business firms are usually looking for team players even when
trying to hire geeks. They are almost always looking for recruits who can make
conversations. Learn how to keep conversations going by asking questions in
various settings from cocktail parties to business luncheons. Sometimes learn
from watching others who are really good at starting conversations and keeping
them going. Avoid personal questions that might embarrass a recruiter who really
does not want to admit that he or she has five kids by three former marriages
and an extramarital affair.
Be prepared for a recruiter that prefers stress testing. Hold your
temper, be calm, and don't show the cracks in your confidence. Always remain
polite and as self-assured as possible. This is not a cop giving you a traffic
ticket. You don't have to keep your mouth shut or be timid. Timid people often
have to look for another job.
If you don't feel like it do not be embarrassed by turning down alcohol when
others around you are drinking the hard stuff. If if you do imbibe always
stay sober enough to drive safely home even if you are not the designated
driver. Always know how your body handles alcohol. Whereas I get happy and
talkative after two martinis, I know some folks who turn surly on booze. That's
not good!
And lastly, never post anything in a social media site that you might be
embarrassed to discuss in a job interview. The interviewer may see this site
before or after the interview or hear about it from somebody you know. Taking
political sides should not hurt you when seeking a business job --- unless you
are applying for a faculty position in a college where conservative leanings can
kill your chances until you're granted tenure.
Bob Jensen's threads on careers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
"Accounting Doctoral Programs: A Multidimensional
Description," by Amelia A. Baldwin, Carol E. Brown and BradS.
Trinkle.
http://www.academia.edu/532495/Accounting_Doctoral_Programs_A_Multidimensional_Description
Advances in Accounting Education: Teaching and Curriculum Innovations,
Volume 11, 101–128Copyright r 2010 by Emerald Group Publishing Limited
ISSN: 1085-4622/doi:10.1108/S1085-4622(2010)000001100
Accounting doctoral programs have been
ranked in the past based on publishing productivity and graduate
placement. This chapter provides descriptions of accounting doctoral
programs on a wider range of characteristics. These results may be
particularly useful to doctoral applicants as well as to doctoral
program directors, accreditation bodies, and search committees
looking to differentiate or benchmark programs. They also provide
insight into the current shortage of accounting doctoral graduates
and future areas of research. Doctoral programs can be
differentiated on more variables than just research productivity and
initial placement. Doctoral programs vary widely with respect to the
following characteristics: the rate at which doctorate sare
conferred on women and minorities, the placement of graduates
according to Carnegie classification, AACSB accreditation, the
highest degree awarded by employing institution (bachelors, masters,
doctorate),
Continued in article
Table 1. Accounting Doctoral Graduates by
Program, 1987–2006(Size; 3,213 Graduates).
http://www.academia.edu/532495/Accounting_Doctoral_Programs_A_Multidimensional_Description
Note that I corrected the ranking for North Texas State from the
original table
The average of 161 per year has been declining. In 2013 there were
only 136 new accounting doctorates in the USA.
Rank |
Program |
# |
Rank |
Program |
# |
Rank |
Program |
# |
Rank |
Program |
# |
01 |
Texas A&M |
87 |
25 |
Arkansas |
46 |
49 |
Columbia |
31 |
73 |
MASS |
17 |
02 |
Texas |
78 |
26 |
Florida State |
45 |
50 |
Drexel |
31 |
74 |
Syracuse |
16 |
03 |
Illinois |
72 |
27 |
Indiana |
45 |
51 |
Northwester |
31 |
74 |
Wash St. Louis |
15 |
04 |
Mississippi |
70 |
28 |
Tennessee
|
44 |
52 |
Cornell |
30 |
75 |
Central Florida |
14 |
05 |
Va. Tech |
70 |
29 |
Texas Tech |
44 |
53 |
Purdue |
29 |
76 |
Cincinnati |
14 |
06 |
Kentucky |
69 |
30 |
Georgia St. |
43 |
54 |
Minnesota |
28 |
77 |
Cleveland St |
14 |
07 |
Wisconsin |
69 |
31 |
Colorado |
42 |
55 |
Oklahoma |
28 |
78 |
MIT |
13 |
08 |
North Texas |
65 |
32 |
NYU |
42 |
56 |
Penn |
28 |
79 |
Fla Atlantic |
12 |
09 |
Arizona |
64 |
33 |
Oklahoma St |
42 |
57 |
Rochester |
28 |
80 |
UCLA |
12 |
10 |
Georgia |
64 |
34 |
Rutgers |
42 |
58 |
So. Illinois |
28 |
81 |
Union NY |
10 |
11 |
Penn State |
63 |
35 |
Alabama |
41 |
59 |
Oregon |
27 |
82 |
Texas Dallas |
09 |
12 |
Nebraska |
61 |
36 |
Va. Common |
40 |
60 |
Texas Arling. |
27 |
83 |
Tulane |
08 |
13 |
Arizona St. |
60 |
37 |
Memphis |
38 |
61 |
Utah |
27 |
84 |
Duke |
6 |
14 |
Houston |
60 |
38 |
Stanford |
37 |
62 |
Baruch |
25 |
85 |
Jackson St. |
6 |
15 |
Michigan St. |
60 |
39 |
Chicago |
36 |
63 |
Connecticut |
24 |
86 |
Fla. Internat. |
4 |
16 |
Washington U |
55 |
40 |
Missouri |
36 |
64 |
Carnegie M. |
23 |
87 |
SUNY Bing. |
4 |
17 |
So. Carolina |
54 |
41 |
No. Carolina |
36 |
65 |
Geo. Wash |
23 |
88 |
Yale |
4 |
18 |
Michigan |
52 |
42 |
So. Calif. |
36 |
66 |
Wash. State |
23 |
89 |
Ga. Tech |
3 |
19 |
La. Tech |
51 |
43 |
UC Berkeley |
35 |
67 |
Kansas |
22 |
90 |
Rice |
3 |
20 |
Ohio State U |
50 |
44 |
Boston Univ |
35 |
68 |
SUNY Buffalo |
21 |
91 |
Tx. San Anton. |
3 |
21 |
Kent State |
49 |
45 |
Maryland |
35 |
69 |
St. Louis |
21 |
93 |
Miami |
2 |
22 |
LSU |
49 |
46 |
Pittsburg |
35 |
70 |
CWRU |
19 |
94 |
Cal. Irvine |
1 |
23 |
Florida |
47 |
47 |
Iowa |
34 |
71 |
Harvard |
19 |
95 |
Hawaii |
1 |
24 |
Mississippi St |
47 |
48 |
Temple |
34 |
72 |
South Fla. |
19 |
96 |
Vanderbilt |
1 |
Jensen
For years prior to 1987 and years subsequent to 2006 you can see the
data by years in a sequence of the Accounting Faculty Directories
by James Hasselback. For example, for years 1995-current go to
http://www.jrhasselback.com/AtgDoct/XDocChrt.pdf
For years prior to 1995 you have to go to earlier editions of Jim's
directories.
There are some minor discrepancies. For example, the above table
shows 3 graduates for Rice after 1987 whereas Jim Hasselback shows no
graduates at Rice after 1995. I did not check for all the discrepancies
between the two data sources. Rice no longer has a doctoral program in
accountancy. There are several newer (small) programs such as the one at
the University of Texas at San Antonio.
The Baldwin, Brown, and Trinkle paper goes on to discuss trends over
time in the leading programs and much much more. I did not quote data
from their paper that was not previously provided by Jim Hasselback at
http://www.jrhasselback.com/AtgDoct/XDocChrt.pdf
A few of the many important revelations in the BBT study that might
be noted for 1987-2006:
- The proportion of female accounting doctorates was 38% of
the 3,213 graduates over 20 years.
- The proportion of minority accounting doctorates was 4.6% of
the 3,213 graduates over 20 years.
- Foreign placement of accounting doctoral graduates whose
location is known is about 14% (including those going back to
Canada)
- Non-academic placement of accounting doctoral graduates
whose employment is know is about 3%. There are very few career
advantages of having an accounting Ph. D. in industry. This is
not the case in most other academic disciplines.
There is much more detailed information available in this study at
http://www.academia.edu/532495/Accounting_Doctoral_Programs_A_Multidimensional_Description
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
"Gender Ratios at Top PhD Programs in Economics," by Galina
Hale and Tali Regev, April 8, 2013 ---
http://econ.tau.ac.il/papers/foerder/2013-10.pdf
The growing concern for the
under-representation of women in science and engineering has
prompted an interest in the mechanisms driving the share of women in
these fields, and in the effect that the gender diversity of the
faculty has on the share of female students. Interestingly, some
universities are more successful than others in recruiting and
retaining women, and in particular female graduate students. Why is
this the case? This paper explores the uneven distribution of female
faculty and graduate students across ten of the top U.S. PhD
programs in economics. We find that the share of female faculty is
correlated with the share of female graduate students and show that
this correlation is causal. We instrument for the share of female
faculty by using the number of male faculty leaving the department
as well as the simulated number of leavings. We find that a higher
share of female faculty has a positive effect on the share of female
graduate students graduating 6 years later.
Women are under represented in science and
engineering. In 2010, Men outnumbered women in nearly every science
and engineering field in college, and in some fields, women earned
only 20 percent of bachelor’s degrees, with representation declining
further at the graduate level (Hill et al., 2010).
In economics, women constituted 33 percent of
the graduating PhD students, and only 20 percent of faculty at PhD
granting institutions (Fraumeni,
2011). Women in economics have been shown to have different career paths
than men and to be promoted less (Kahn, 1993; Dynan and Rouse, 1997;
McDowell et al., 1999; Ginther and Kahn, 2004). Focusing on the
progression of women through the academic ladder, most research has
failed to fully account for the effect that successful women in the
field have had on the entrance and success of other women. More
specifically, the gross effect that women faculty have on the share
of female students have not been fully explored. In this study we
address this gap in the literature and focus on the causal
relationship between the share of female faculty in top economics
departments and the share of graduating female PhD students.
Continued in article
Jensen Comment
Women seem to be making greater strides in Ph.D. achievements in
economics that in many other science fields. It would seem that they
could make greater strides in fields like computer science where males
dominate to a much higher degree.
In economics at the undergraduate
and masters levels in North America there are significantly more male
graduates than female graduates. Having more female teachers tends to
increase the number of undergraduate majors according to the above
study.
In accounting at the
undergraduate and masters levels in North America there are
significantly more women graduates than men,
and the large CPA firms hire more women than men. There is a possible
glass ceiling, however, in terms of newly-hired CPA-firm women who
eventually become partners. That is a very complicated story for another
time other than to note that the overwhelming majority of newly-hired
males and females in large CPA firms willingly leave those firms after
gaining experience and very extensive training.
Many of those departures go to clients of CPA firms where the work
tends to have less travel and less night/weekend duties as well as less
stress. In my opinion most accounting graduates who go to work for CPA
firms did not ever intend to stay with those CPA firms after gaining
experience and training. This accounts for much of the turnover,
especially in large CPA firms. Turnover has an
advantage in that it creates more entry-level jobs for new graduates
seeking experience and extensive training.
Bob Jensen's threads on the history of women in the professions
---
http://faculty.trinity.edu/rjensen/bookbob2.htm#Women
Here Are The Chances An Internship Lands You A Job In Your
Industry ---
http://www.businessinsider.com/internships-to-jobs-2014-9#ixzz3D1AhroIH
. . .
From our
reading of
2013 data from LinkedIn,
here's the
percentage of internships that lead to jobs in the following
industries:
• Accounting: 60%
• Oil & energy:
33%
• Investment banking: 31%
• PR & communications:
28%
• Law practice: 26%
• Apparel & fashion:
25%
• Hospitality: 24%
• Government administration:
23%
• Publishing: 22%
• Museums:
21%
• International affairs: 20%
• NGO management:
19%
The task, of course, is landing
those gigs in the first place. We got you covered: here are our
guides to nabbing a
Google or
Wall Street internship.
2009 Best Places to Start/Intern According to
Bloomberg/Business Week ---
Click Here
Also see the Internship and Table links at
http://www.businessweek.com/careers/special_reports/20091211best_places_for_interns.htm
The Top five rankings contain all Big Four accountancy firms.
Somehow Proctor and Gamble slipped into Rank 4 above PwC
The accountancy firms of Grant Thornton and RMS McGladrey make the top
40 at ranks 32 and 33 respectively.
Best Places to Intern ---
http://www.businessweek.com/managing/content/dec2009/ca2009129_394659.htm?link_position=link1
I'm waiting for Francine to throw cold water on the "ever
before" claim
Especially note the KPMG Experience Abroad module below
"Best Places to Intern: Bloomberg BusinessWeek's 2009 list shows
employers are hiring more interns to fill entry-level positions than
ever before," by Lindsey Gerdes,
Business Week, December 10, 2009 ---
http://www.businessweek.com/managing/content/dec2009/ca2009129_394659.htm?link_position=link1
How valuable is a
summer internship in a recession? Consider
Goldman Sachs, the
leading choice for students interested in a career on Wall Street.
This year, the investment bank hired 600 fewer entry-level
employees. That's not surprising given the stunted economy and the
government bailout of banks. What is noteworthy is nearly 90% of
Goldman's new hires were former interns. The previous year, Goldman
wasn't as concerned about hiring a high percentage of students it
had already invested time and money to trainonly 58% of entry-level
hires had spent a summer at the company.
The same is true for
other employers.
KPMG,
a Big Four accounting firm
that finds itself in tight competition with
Deloitte,
Ernst & Young, and
PricewaterhouseCoopers,
hired nearly 900 fewer entry-level employees this
year. But 91% of those full-time hires were former interns, whereas
only 71% of new hires in 2008 were interns.
Internships have long
been seen as a primary recruiting tool at many top employers—a
10-week job tryout to see who would be the best fit for full-time
employment. But with full-time hiring down, even the largest
employers are trying to maximize the investment they've made in
interns by hiring a larger percentage to fill entry-level position
than ever before. "It's true for all years, but I think it's even
more so in years like this," says Sandra Hurse, a senior executive
at Goldman who handles campus recruiting.
Evaluating Employers
With
this ranking,
Bloomberg
BusinessWeek has put together its third annual guide to the
best internships, providing information on the number of interns
each company recruits, how many are offered full-time jobs, the
number of interns expected to be hired next year, even the salaries
students receive.To compile our list, we judged employers based on
survey data from 60 career services directors around the country and
a separate survey completed by each employer.We also consider how
each employer fared in the annual
Best Places to Launch a Career,
our ranking of top U.S.
entry-level employers released in September of each year.
Our ranking of
the best U.S.companies for undergraduate internships
highlights employers who have put
together an outstanding experience for students.Accounting firm
Deloitte tops our list, followed by rivals KPMG (No.2) and Ernst &
Young (No.3).The last of the Big Four accounting companies,
PricewaterhouseCoopers, comes in at No.5, right behind consumer
goods giant
Procter & Gamble.
The employers on our
list understand that an outstanding internship experience is their
most effective recruiting tool to snap up the top entry-level job
candidates. That's why some companies have invested a considerable
amount of money in their programs.
Microsoft,
for example, estimates it spends on average $30,000 per intern, when
you factor in pay and benefits. Considering the company hired 542
undergraduate interns in 2009, that's roughly a $16 million
investment.
Experience Abroad
Two years ago KPMG
realized it had to make a substantial investment in its internship
program if it hoped to woo top students from larger consulting and
accounting firms. So the company decided to offer interns an
opportunity to gain valuable overseas experience. KPMG lets student
interns spend four weeks in the U.S. and four weeks abroad. "It's
extremely competitive [to recruit top students], and this is a
differentiator," says Blane Ruschak, executive director of campus
recruiting at KPMG.
A chance to work
overseas is precisely what appealed to Andrew Fedele, 21, an
accounting and economics double major at Pennsylvania State
University. "I was sold pretty much when I first read about [KPMG's]
global internship program." He spent four weeks in Chicago and four
weeks in Johannesburg, South Africa. "South Africa has just such an
interesting history. To go there and live with the locals and work
with them was really exciting."
What did KPMG get in
return? Exactly what it hoped: Fedele accepted a full-time job
almost immediately after KPMG made its offer at the end of the
summer.
Gerdes
is a staff editor for
BusinessWeek in New York.
"I'm About To Join A Generation Of Jobless PhDs," by Amanda
Chung, Business Insider, January 19, 2014 ---
http://www.businessinsider.com/im-about-to-join-a-generation-of-jobless-phds-2014-1
Jensen Comment
If accurate, the abovehttp://www.aacsb.edu/bridge/ graph pretty much
explains the supply versus demand of Ph.D.s
It also explains why the AACSB's Bridge Program to become a business
professor has so many prospects ---
http://www.aacsb.edu/bridge/
Bob Jensen's threads on careers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
The Part 2 Videos from the IMA are Now Available
7 Trends in Management Accounting - Introduction
---
https://www.youtube.com/watch?v=gRyW2_Ay2Cw&hq_e=el&hq_m=1655061&hq_l=12&hq_v=bd6554f22c
The seven trends that the video series will
explore include:
1) Expansion from product to channel and customer profitability
analysis
2) Management accounting’s expanding role with enterprise
performance management (EPM)
3) The shift to predictive accounting
7 Trends in Management Accounting - Part 2 ---
http://www.imanet.org/PDFs/Public/SF/2014_01/01_2014_cokins.pdf
4) Business analytics embedded in EPM
methods
5) Coexisting and improved management accounting methods
6) Managing information technology and shared services as a business
7) The need for better skills and competency with behavioral cost
management
"Saving Management Accounting in the Academy," by Sue Haka
(former AAA President), AAA Commons, Last Edited February 10, 2012
http://commons.aaahq.org/posts/98949b972d
Discussion:
Saving
Management Accounting in the Academy
Details:
The long
run place of management accounting in the academy seems
in peril for several reasons. First, there is an
ongoing migration of accounting topics to other
disciplines. Second, evidence suggests that the
diversity in management accounting research seems to be
dwindling. Third, the value of our content for MBA
programs is not apparent. Finally, our engagement with
the management accounting practitioner community is
weak.
First-topic
migration: I don't know about your experiences,
but at my institution I must be ever vigilant about
traditional management accounting topics migrating into
management, marketing, or supply chain classes. While I
am delighted that cost-volume-profit topics are
important to my marketing colleagues, unfortunately the
students that come to my management accounting class
after having been "taught" CVP by my marketing
colleagues cannot distinguish between fixed and variable
costs! Other topics taught by my colleagues include ABC
in supply chain and balanced scorecard in management.
Making sure that students are required to take a
management accounting class prior to classes where
discussions about how ABC is important for supply chain
decision making requires constant vigilance. Years ago
management accounting virtually gave capital budgeting
up to the finance department...is fair value
measurement next!
Second-research
diversity: I have often been among those who have
suggested that general accounting research is not
sufficiently diverse (i.e. an overabundance of financial
archival focus). I forgot my mother's phrase--when you
point at others, three fingers point back at you! Recent
reviews of JMAR topical areas suggest a lack of
diversity within our discipline. These reviews show an
overwhelming focus on performance measurement--in 2008
(2007) 48% (50%) of submitted articles were focused on
performance measurement. Only one other category is over
12%. It seems that management accounting research is
fairly narrow.
Third-value in
the MBA: Management accounting should be a
bedrock of MBA programs. However, we have let financial
accounting eclipse management accounting. MBA programs
have, over the last decade, decreased accounting content
and the majority of that reduction has come out of
management accounting. Yet most MBAs become managers and
management accounting should be highly value added for
them.
Finally-practitioner engagement: While our
colleagues in auditing and financial accounting have
opportunities to serve as fellows at the SEC or FASB or
take a semester or year to work at one of the big four
firms, management accounting faculty have
few established programs allowing us to experience first
hand many of the issues that we teach and write about. I
believe creating these types of opportunities would help
us diversify our research and convince others of the
value of management accounting for MBAs and in the
practicing communities.
I'm sure
you have other issues that imperil the discipline
of management accounting. Please add your comments and
discussion.
Note the relatively large number of comments to this article
Also see
Accounting at a Tipping Point (Slide Show)
Former AAA President Sue Haka
April 18, 2009
http://commons.aaahq.org/files/20bbec721b/Midwest_region_meeting_slides-04-17-09.pptm
"Frustrations of a Mover and Shaker for Managerial Accounting,"
by Gary Cokins, SmartPros, October 2012 ---
http://accounting.smartpros.com/x74303.xml
Many who just read "managerial accounting"
in this blog's title are not bothering to read this. Why? They do
not care. They only care about external financial reporting for
regulatory agencies, bankers, and investors. This frustrates me
because I interpret this as their not caring about managers and
employees who need better internal managerial accounting information
for insights and foresight to make better decisions compared to what
they are currently provided by their CFO's function.
Should I laugh or cry?
Allow me to
share with you some examples of what frustrates me related to this
topic.
In a recent discussion thread in
the website of the
Institute of Management Accountants (IMA)
there was a post that described how
to calculate product and standard service-line costs. The writer
meticulously listed the steps. In the final instruction they wrote
to “allocate” the indirect and shared support expenses one should
use broadly-averaged basis like the number of direct labor input
hours, headcount, or square feet. I did not know whether I should
laugh or cry! Where have they been the last few decades?
This
primitive cost allocation method totally violates the costing
principle of a cause-and-effect relationship between changes in the
amount of workload and the products and services that consume those
expenses. Activity-based costing (ABC) resolves this. ABC has been
researched and promoted since the 1980s. (I was trained in 1988 by
ABC’s lead promoter, Harvard Business School’s Professor Robert S.
Kaplan. I subsequently wrote several books on ABC.) After
implementing my first ABC system, the company was shocked by how
different the product costs and profit margins were compared to
their existing “cost peanut butter spreading” method. They were
exact in total, but not with the parts. I then thought the practice
of ABC would take off like a rocket. It hasn’t, but its acceptance
continues with a slow but increasing pace. Too slow for me.
But
wait. There is more!
This blog
may now appear to be like a television Ginza knives commercial.
There is more!
I am involved with five
university faculty to author a report for the
American
Accounting Association on reforms for
university accounting course curriculums to shift the emphasis of
teaching topics from financial to managerial accounting methods. It
is a noble effort. What concerns me is how sensitive my co-writers
are to the resistance from accounting faculty that this shift would
be different from what accounting professors already teach. We will
never move finance and accounting professionals from “bean
counters to bean growers”
if we continue with traditional practices.
Another
example of my frustration involves adversarial competition for
managerial accounting practices. Often driven by self-serving
consultants, they advocate managerial accounting methods that only
serve their interest. The late Theory of Constraints (TOC) guru Eli
Goldratt proclaimed, “Cost accounting is enemy number one of
productivity.” He proposed the throughput accounting method, which
with investigation only applies under very special conditions of a
24 / 7 / 365 existence of a physical bottleneck like a heat treat
oven in a foundry. Some lean accounting advocates slam ABC as being
misguided. Both of these methods, if exclusively used, deny
strategic analysts understanding of the profit margins of products,
services, channels, and customers.
Cutting through the Clutter
I participated on a task force
that recently published a report for the IMA titled
“The
Conceptual Framework for Managerial Accounting.”
It is an exposure draft that anyone interested in it can review and
comment on. Our task force’s mission was to determine key accounting
principles to reflect economic reality that any managerial
accounting system should comply with.
Many
organization’s existing practices would fail compliance with the
report’s framework. With financial accounting, if the CFO gets the
numbers wrong, they can go to jail! But when they get the managerial
accounting information, they don’t go to jail. Nor should they. But
at least CFOs should feel embarrassed and irresponsible that they
are performing a disservice to their organization’s workforce who
increasingly needs much better management accounting information
from which to further apply business analytics.
Continued in article
Jensen Comment
Like it or not, the curriculum of accountancy in higher education is
driven by entry-level employment opportunities. The heaviest part of the
curriculum devoted to passage of the CPA examination is driven largely
by the entry-level employment and training opportunities to new
graduates by CPA firms, particularly the larger firms. The tax
curriculum is driven by those same firms and by the IRS since the IRS
has so many entry level opportunities for accounting graduates.
Management accounting and related disciplines such as internal
auditing offer tremendous opportunities five or more years down
the road for experienced accountants but not many opportunities for
getting such experience are offered at the time of graduation.
Corporations and other organizations like the FBI put accounting
graduates between a rock and a hard place. These organizations want
experienced accountants but do not offer experience opportunities at the
entry level. Instead they lure employees of CPA firms and the IRS away
five or more years after the students have graduated.
Perhaps "lure" is the wrong word here, because many graduates go to
work for CPA firms and the IRS with the full intent of moving on to
managerial accounting in about five years or more. In other words
managerial accounting is part of a long-term career plan after
experience is gained as a CPA and/or IRS agent.
An exception arises sometimes for AIS specialists that are in demand
by almost everybody, especially if they have have quite a lot of
computer science courses and IT courses in their transcripts. But
corporations are not giving entry-level job offers to AIS graduates for
managerial accounting. They are seeking very technical employees for
their computing, database management, and networking divisions.
Exceptions arise in the corporate hiring of minority graduates of
accounting programs, especially managerial accounting graduates from
historically black colleges in the USA.
Accounting majors who only took one or two AIS courses are not
usually "AIS" graduates unless they took a lot more computer programming
and IT. These accounting students with only one or two AIS courses are
usually headed down an auditing track in CPA firms.
Bob Jensen's threads on accounting careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Demand is very high at the moment for accounting graduates from masters
programs. Students now need a fifth year to sit for the CPA examination,
and most of those opt for a masters program.
If the corporations really want more managerial
accounting in the higher education curriculum then they should compete
with the CPA firms for the top entry-level graduates of masters
programs. This would also entail offering more formalized training
programs like those training programs in the largest CPA firms.
"The 33 Whitest Jobs In America," by Derek Thompson, The
Atlantic, November 6, 2013 ---
http://www.theatlantic.com/business/archive/2013/11/the-workforce-is-even-more-divided-by-race-than-you-think/281175/
Academe does not appear in the
90%+ white chart. Perhaps this is because academic
disciplines vary so much in terms of having minority professors ---
especially in disciplines (like mathematics and accounting) having
increasing proportions of Asian Americans but not African Americans and
Latinos. Also academe is confounded by having "minorities" who are still
on Green Cards and are otherwise non-native Americans. Although the
proportion of white professors of accounting is declining due mostly to
a growing number of Asian accounting professors, the proportion African
American and Latino accounting professors is miserably low. The KPMG
Foundation for decades has taken on a serious funding initiative to
increase the number of African Americans in accountancy doctoral
programs. But the number of graduates is still a drop in the proverbial
bucket.
"Whatever Happened to All Those Plans
to Hire More Minority Professors?" by Ben Gose, Chronicle of
Higher Education, September 26, 2008
http://chronicle.com/weekly/v55/i05/05b00101.htm?utm_source=at&utm_medium=en
Women and Minority Lawyers Practicing Law and Accountancy
"Diversity in the Legal Profession, 2013," by Paul Caron, TaxProf Blog, December 12, 2013 ---
http://taxprof.typepad.com/taxprof_blog/2013/12/diversity-in-.html
"The 33 Whitest Jobs In America," by Derek Thompson, The
Atlantic, November 6, 2013 ---
http://www.theatlantic.com/business/archive/2013/11/the-workforce-is-even-more-divided-by-race-than-you-think/281175/
CPA firms hire more women than me at the entry level but retention
percentages are lower in part due to mothers leaving the workforce.
CPA firms increased their hiring of minorities to over 30% at the
entry level, but the retention level drops back down to the neighborhood
of 20% ---
http://www.journalofaccountancy.com/Issues/2012/Jun/20114925.htm
Reasons for lower retention rates include failure of new hires to pass
the CPA Examination after being hired. Another perhaps more important
reason is the traditionally high turnover of more recent employees in
the larger CPA firms where most of those employees move into higher
paying jobs (often with clients) or move out of the labor force to
become full-time parents. Top minority employees of CPA firms are
especially likely to receive attractive job offers from clients.
Bob Jensen's threads on diversity in academe ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#AffirmativeAction
Law schools have been especially aggressive in recruiting top
African American and Latino students.
This competition especially hurts when recruiting minority students for
masters programs in accountancy (most CPA Examination candidates now
graduate from such masters programs). One reason for law school minority
recruitment success is that students can major in virtually any
discipline in college and later be admitted to law school if they have
the required LSAT scores. Most masters of accounting programs require
what is tantamount to an undergraduate accounting major. This greatly
reduces the number of minorities eligible to take the CPA Examination.
However, students can still be business accountants without having
passed the CPA examination. It's much harder, however, to get
entry-level experience without first working for either a CPA firm or
the IRS.
Occupations with tough licensing examinations tend to have lower
lower percentages of blacks and Latinos.
More than half of the black and Latino
students who take the state teacher licensing exam in Massachusetts
fail, at rates that are high enough that
many minority college students are starting to avoid teacher training
programs,
The Boston Globe reported. The
failure rates are 54 percent (black), 52 percent (Latino) and 23 percent
(white).
Inside Higher Ed, August 20, 2007 ---
http://www.insidehighered.com/news/2007/08/20/qt
Certification Examinations
http://faculty.trinity.edu/rjensen/Assess.htm#CertificationExams
"Law School Applicants From Top Colleges Plunge 36%," by Paul Caron,
TaxProf Blog, March 6, 2014 ---
http://taxprof.typepad.com/taxprof_blog/2014/03/law-school-applicants.html
. . .
The reasons for the drastic decline in
applications among elite students are twofold:
1) Not all of these applicants get into top
14 schools. The median GPA/LSAT of this cohort is probably about
3.6/165. And that’s a high estimate. So, if there are 2,100 of these
applicants, probably 1,200 of them get into top 14 schools. Another
500 or so probably get into top 20(ish) schools, as measured by
Biglaw employment outcomes. That totals 1,700.
Unless one has a full, or nearly full
scholarship, there is absolutely no point in an Ivy League grad
attending anything less than a top 20(ish) school given the current
rate of tuition. And they would have to think long and hard about
attending anything outside of the top 14, or even the top 10. Why
would a graduate with a good degree, and likely some decent
employment options, sully their resume with a grad degree from a
lesser institution, reduce their likelihood of employment and
accumulate massive debt all at one time?
2) Even Harvard, Stanford and Yale are
crappy options now if you don’t have financial support. These
institutions rarely give merit scholarships, yet carry huge
pricetags, so most middle class kids will be on the hook for $200k+
in debt. These days, many will be in the $250k+ range. This will
require working at least 6 years in Biglaw to pay down the debt.
That is quite the sacrifice, and quite the risk, for many in this
group who always figured they could do exactly what they dreamed of
with their lives.
Note that the potential changes to the
Public Interest Loan Forgiveness laws will be a huge deterrent for
potential applicants for this group as well—especially among women.
I suppose a handful of these schools have their own generous loan
forgiveness programs, but not all of them, and certainly none
outside of the top 10 or so law schools.
Jensen Comment
Surprisingly Professor Caron does not go on to also state that some of
the job opportunities in law aren't so hot even from the top law
schools. By default, however, this seems to be the implication if the
return on investment with high debt does not have a great expectation.
Presumably the students getting those need-based scholarships have
higher expected returns, although the top-paying law firms are not yet
noted for affirmative action hiring.
This of course begs the question of where those 36% of those
graduates from prestigious universities are turning for careers other
than law. There is such an overwhelming supply of unemployed PhDs in
most disciplines that opportunities do not abound in the PhD market.
Most graduates from top schools did not have a chance to choose
accounting as undergraduates and thus cannot be admitted to masters
programs in accounting until taking 30+ credits of prerequisite
undergraduate accounting courses. Many are probably leaning toward MBA
programs. Prestigious MBA programs are very expensive, but since they
are only two-year programs they are cheaper than law schools.
Some of those undergraduates strong in mathematics and economics
might consider a PhD program in accounting where the job market is still
hot. They might have to learn a bit of accounting, but the accounting
prerequisites for accountancy PhD programs are minimal compared to
prerequisites need to become a CPA ---
http://faculty.trinity.edu/rjensen/Theory01.htm#DoctoralPrograms
The advantage of accountancy PhD programs is that most of them are
free in terms of tuition, room, and board since those programs put
together packages of fellowships and assistantships that are good for
about five full-time years. A drawback is that such programs take 5-6
years in comparison with an economics PhD that may only take 3-4 years.
Another drawback of accountancy PhD programs is lack of capacity. The
really big programs that graduated 10+ accounting PhDs per year are down
to graduating two or less per year on average ---
http://www.jrhasselback.com/AtgDoct/XDocChrt.pdf
Whereas thousands of PhDs in economics or engineering graduate each
year, accounting programs graduating 200+ per year in the 1980s are down
to less than 140 per year in recent times.
Thus the numbers of undergraduates from even our most prestigious
universities have very limited opportunities for getting into accounting
doctoral programs.
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
"Has Your Business Degree Failed You? Answer 5 Basic Questions to
Find Out!," by Anthony H. Catanach, Grumpy Old Accountants,
January 14, 2014 ---
http://grumpyoldaccountants.com/blog/2014/1/14/has-your-business-degree-failed-you-answer-5-basic-questions-to-find-out
If your goal in getting a
college business degree was simply to get a “job” with the least
effort expended, stop reading now! But if you were serious about
learning the fundamental skills needed to support a long-term
professional career in business, including a life-long learning
perspective, your passion and zeal just may not have been enough
according to a number of recent articles in the popular business.
Some suggest that college in general
should be questioned.
Glenn Harlan Reynolds,
a University
of Tennessee law professor, encourages parents and students to “be
skeptical” about the value of college. With average student debt
exceeding $29,000 and 40 percent of college graduates taking jobs
that don’t require a college degree, he suggests that:
America's higher education
problem calls for both wiser choices by families and better
value from schools.
It’s hard to disagree with this
statement particularly when so many parents and students conduct
more due diligence in a car purchase than selecting the “right”
college or university.
Reynolds also notes that the value
proposition for a college degree is frequently obscured by the “bait
and switch” tactics increasingly used by administrators, as well
their lack of budget transparency. Many schools now routinely
“outsource” class instruction to low-paid adjuncts to cut costs (and
let’s not even get into on-line “classroom” initiatives), and it is
next to impossible to see where one’s tuition dollars actually are
being spent (e.g., administration, athletics, research, or
teaching).
And guess what? Surprise…surprise…many
employers now are questioning the skills of today’s graduates. Richard
Vedder and Christopher Denhart from
Ohio University confirm that:
Declining academic standards
and grade inflation add to employers' perceptions that college
degrees say little about job readiness.
They argue that the numbers just don’t
work when college degree benefits are questionable and college costs
are increasing. And the narrowing gap between what college and high
school graduates earn particularly concerns them. As an old
jarhead, I found one of their statements particularly telling:
We now have more college
graduates working in retail than soldiers in the U.S. Army, and
more janitors with bachelor's degrees than chemists.
But what about business degrees
specifically?
Dan Kadlec,
a journalist for TIME,
believes that:
Colleges are minting
money-focused graduates in a work world that increasingly values
critical thinking and softer skills like the ability to
communicate.
Melissa Korn
of the Wall Street
Journal reports that “undergraduate business majors are a dime a
dozen” and “may be worth even less,” since more than 20 percent of
undergraduates in the United States are business majors. And
graduate business education doesn’t get a free pass either. John
A. Byrne, a contributor to CNN Money,
documents the case of
Josh Kaufman
who believes that MBA
programs “teach many worthless, outdated, even outright damaging
concepts and practices.”
Still not convinced that there just
might be a flame or two behind all this “smoke,” then just take a
look at look at
Lynn O’Shaughnessy’s
number one reason why NOT to get a business degree: business
majors don't learn much in business school! Her conclusion
was based on
Academically Adrift,
a bestselling
book that finds that business majors are among the students who
learn the least in college.
All of this negativism makes this
Grumpy Old Accountant seem absolutely cheery doesn’t it? Well, I
must confess that my recent interactions with experienced business
graduates (both at the bachelor and master levels) employed as
accountants, analysts, managers, and reporters have raised more than
a few doubts in my own mind. So, I decided to create a short, five
question test (no accounting included, I promise) that
administrators, current students, faculty, and recent graduates may
find useful for assessing the effectiveness of their B-school
experience. And it’s no coincidence that the five questions mirror
the major themes routinely discussed today by business academics and
professionals alike. Being naturally grumpy, this exam is a closed
book, closed note, essay test that should be completed with no
outside assistance…what did you expect?
Question One:
What is a business?
Believe it or not, many B-school
graduates cannot answer this query in a clear, concise
manner. Often, the response is a long-winded, rambling summary of
discrete topics that parallel course requirements that fails to
accurately capture the essence of today’s enterprises. To receive
full credit, the answer should be close to the following:
A business is an economic entity
that creates wealth (e.g., value, cash flow, etc.) by using
financial, human, and physical capital to deliver products or
services that the market demands.
And if you really want to wow this old
prof, throw in a bit of the “nexus
of contract theory” to motivate the
need for information to monitor the various contracts which
companies execute with shareholders, employees, suppliers,
customers, debtors, and the like.
Question Two:
What is business strategy?
So, once you decide on a business,
what’s the strategy? The answers commonly received to this question
are particular disturbing in that they refer to assorted
permutations of action plans and related documents. Sorry, just not
specific or good enough. To receive full credit, the answer should
address two key issues:
Business strategy is how an
organization creates value for its customers and differentiates
itself from competitors in the marketplace.
Value creation and differentiation
must be addressed in every good strategy whether it be for a company
as a whole, or each individual operating unit. This short
definition specifically focuses managers on their markets and
customer needs. If customers don’t value a company’s product or are
indifferent to it vis-a-vis that of the competition, the company is
unlikely to succeed in the long-run, regardless of its stated
“strategy.” If you add some verbage about Michael Porter’s
Five Forces
model in your
differentiation discussion in the context of today’s technology
dominated world, you will bring a smile to this Grumpy Old
Accountant’s face.
Question Three:
What is a business model?
This dot-com era buzzword can generate
some very interesting definitions which provide great insight into
what has been learned (or not) in the B-school. Frequent responses
include a business idea, an overly-complicated financial model, or a
business plan. These answers don’t even warrant partial credit! So
what is it?
A business model describes how
the pieces of a business fit together as a system to execute the
firm’s stated strategy.
Every business model whether it be for
the whole entity or each individual operating unit must address ALL
of the following fundamental “value chain” activities: market
analysis, product development and design, sales and marketing;
procurement, production, and distribution, and after sale customer
service. How do each of these activities contribute to
strategy execution? Answer that and now you have a business model!
And some references to “How
to Design a Winning Business Model” by Ramon Casadesus-Masanell and Joan E. Ricart will likely get you
some bonus points.
Question Four:
How should a business evaluate its performance?
As an accounting professor, I find the
answers I often receive to this question to be downright depressing:
stock price appreciation, revenue growth, earnings per share, and a
host of other financial statement driven metrics. These might earn
some partial credit, but if you even hint at “adjusted
EBITDA,” you get a zero.
Answering this question requires
getting Question Three correct! To evaluate performance you must
have something concrete to measure. In the case of a business, it’s
how each of the five value chain activities that comprise a firm’s
business model are performing.
A business should measure its
performance by monitoring the implementation, execution, and
effectiveness of its entire business model.
This means that managers need both
financial and non-financial metrics to judge their market analysis,
research and development, selling and marketing, production and
distribution, and customer service activities. Unfortunately, all
too often, companies rely almost exclusively on financial statement
numbers to do so. The best answers to this question will be
organized around Kaplan and Norton’s
Balanced Scorecard
framework.
Question Five:
What role does innovation play in business today?
Historically, business innovation has
been equated primarily with the development of new products and new
technologies. But as
Birkinshaw, Bouquet, and Barsoux suggest,
“products and services represent just the tip of the innovation
iceberg.” So, a few points might be awarded for this weak “common
sense” response. But to receive full credit, respondents must have
scored well on Questions 3 and 4. The following represents a more
complete response:
Business innovation refers to any ideas
and/or actions that can positively transform any part of the
business model or its individual value chain activities, as well as
the development of new products or service offerings.
Continued in article
"The Integration of Women and Minorities into the Auditing Profession
since the Civil Rights Period," by Paul Madsen, The Accounting Review,
November 2013, pp. 2145-2177 ---
http://aaajournals.org/doi/full/10.2308/accr-50540 (not free)
Following the Civil Rights Movement and the
“quiet revolution” in women's work over the years from 1950 to 1970,
women and minorities increasingly joined the auditing profession
while the profession ramped up efforts to encourage integration. The
purpose of this study is to rigorously examine how the integration
of auditors has evolved since the civil rights and quiet revolution
period. The primary distinctive feature of this study is that it
evaluates the auditing profession's integration by comparing it to
samples of occupations similar to auditing for the purpose of
isolating auditing-specific forces influencing integration. I find
that the pay structure in auditing is unusually equal, consistent
with “equal pay for equal work.” The results for women, Hispanics,
and miscellaneous minorities are consistent with members of these
groups responding as one might expect to equal pay in auditing:
groups that are poorly paid in other occupations select into
auditing at higher rates, and groups that are well paid in other
occupations select out of auditing at higher rates. The results for
blacks are anomalous in that their pay in auditing has been good
relative to many comparable occupations, but they have nevertheless
been poorly represented in auditing. There are a number of theories
that could potentially explain why blacks may be anomalously
underrepresented in auditing. To begin to test them, I perform an
exploratory analysis of the representation of women and minorities
among college freshmen, college graduates, and young auditors. The
results suggest that accounting is a popular degree among black
college freshmen and that a relatively high percentage of accounting
graduates are black. However, although they are well represented in
the pool of potential new auditors, black accounting graduates enter
the auditing profession at very low rates relative to other
occupations requiring levels of education similar to auditing. The
results suggest that black underrepresentation in auditing is not
due to a lack of awareness among, or role models for, young blacks.
Jensen Comment
In recent years the CPA profession has hired more women than men, which
is consistent with both admissions and graduation data for universities.
The study does not show what proportion of newly hired African
American graduates are from "historically
black colleges and universities," but my guess is that it's
relatively high relative to total first-year hirings of African
Accounting Graduates in total in accountancy. My guess is that a
relatively high proportion of those hirings are in government (e.g., the
IRS) and clients of CPA firms as opposed to CPA firms themselves.
I will now make a statement that is probably not politically correct
and certainly is anecdotal. I have a acquaintance who is a retired dean
of the business school of a well-known historically black university.
She told me that her program played down a CPA examination preparation
curriculum in favor of an industry and government accounting curriculum.
One reason was fund raising, where large corporations showered her
business school with scholarship funding and with multi-year internships
for nearly all of the accounting students. Another reason was that her
accounting program could attract more students if it offered career
opportunities that did not require the highly stressful CPA examination.
"African American Students and the CPA Exam Mentoring, internships
and scholarship programs can draw students into the profession," by
Quinton Booker, Journal of Accountancy, May 2005 ---
http://www.journalofaccountancy.com/Issues/2005/May/AfricanAmericanStudentsAndTheCpaExam.htm
EXECUTIVE SUMMARY |
DESPITE DECADES OF EFFORT by organizations such as
the AICPA and NASBA to bring more minority candidates into
the profession, the numbers are still small. Still, there
were 5,731 African American candidates for the CPA exam in
2002—the largest for any year since 1997.
THE DATA SUGGEST A SEVERE SHORTAGE of African
American males under age 25 holding graduate degrees.
SINCE MANY STUDENTS DECIDE TO major in accounting
as early as high school, employers should begin to build
relationships with high school juniors and seniors through
summer job opportunities.
THE VAST MAJORITY OF CANDIDATES are concentrated in
10 states. Employers in other states need to be more
creative in finding and hiring CPAs.
PROGRESS IS BEING MADE. Much of the success can
likely be attributed to mentoring, internship and co-op
programs, and scholarship programs at the undergraduate,
master’s and doctoral levels. |
QUINTON BOOKER, CPA, DBA, is professor
and chairman of the department of accounting at Jackson
State University, Mississippi. His e-mail address is
qbooker@jsums.edu
. |
National Association of Black Accountants ---
http://en.wikipedia.org/wiki/National_Association_of_Black_Accountants
Association of Latino Professionals in Finance and Accounting ---
http://en.wikipedia.org/wiki/Association_of_Latino_Professionals_in_Finance_and_Accounting
American Society of Women Accountants ---
http://en.wikipedia.org/wiki/University_of_Cambridge#Women.27s_education
History of women accountants in the 1880. US Federal Census ---
http://repository.usfca.edu/cgi/viewcontent.cgi?article=1001&context=acct
Mary Jo McCann (First Woman CPA in Kansas) ---
http://www.kscpa.org/about/news/119-mary_jo_mccann_first_woman_cpa_in_kansas_passes
Bertha Aldrich (First Woman CPA in California) ---
http://boards.ancestry.com/surnames.aldrich/600/mb.ashx
Accounting Reform (search for women) ---
http://en.wikipedia.org/wiki/Accounting_reform
Accounting and Financial Women's Alliance ---
http://www.afwa.org/
Accounting History
Libraries at the University of Mississippi (Ole Miss) ---
http://www.olemiss.edu/depts/accountancy/libraries.html
There are many items pertaining to accounting women in history,
especially in the Accounting Historians Journal
Bob Jensen's threads on the history of women in the accounting
profession are at
http://faculty.trinity.edu/rjensen/bookbob2.htm#Women
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Teaching Case on Careers and Education
From The Wall Street Journal Weekly Accounting Review on November 15,
2013
Why Focusing Too Narrowly in College Could Backfire
by: Peter Cappelli
Nov 11, 2013
Click here to view the full article on WSJ.com
TOPICS: Accounting
SUMMARY: The article begins with a focus on
choosing colleges, such as private versus public and university
versus liberal arts college but offers many tips as students are
choosing their majors. Students can discuss the benefits of a
focused, technical major such as accounting versus the liberal arts
majors. The issues discussed in the article focus on variability of
job opportunities upon students' graduation. Instructors using the
article can emphasize the relative consistency of accounting job
markets and the benefits of the skills learned in students' liberal
arts related courses.
CLASSROOM APPLICATION: The article may be used in
an introductory accounting class during a semester that students are
choosing majors, or at any time to discuss the benefits of skills
learned in liberal arts classes in addition to technical subjects
studied for the accounting major. Several questions ask students to
state what they know about their own college or university.
Instructors can use this to assess students' knowledge and
contribute to class discussion about steps to take to ensure
students develop the best chances for employment after graduation.
QUESTIONS:
1. (Introductory) What are the current concerns in the job
market following students' graduation? How do those concerns form
the basis for this article?
2. (Introductory) According to the article, what are some
majors that have posed challenging job markets for students upon
graduation?
3. (Advanced) What is the Sarbanes-Oxley Act? How did it
"ramp up demand for accountants"?
4. (Advanced) What do you know about the job opportunities
for accounting majors upon graduation? Think especially about the
consistency of job opportunities for accounting majors over
different economies. State in your answer how you can find out this
information for accounting majors graduating from your college or
university.
5. (Introductory) What portion of your coursework is
devoted to liberal arts courses? Based on the discussion in the
article, what is the importance of the skills you learn in these
courses?
6. (Advanced) View the related graphic entitled "Employer
Priorities." Are you surprised by or curious about any facet of this
list? List one item and explain your answer.
7. (Advanced) What steps in your remaining academic career
can you take to be sure that you meet employers' priorities when you
graduate? Will you need help in taking those steps? State where you
think you can find that assistance at your college or university.
Reviewed By: Judy Beckman, University of Rhode Island
"Why Focusing Too Narrowly in College Could Backfire," by Peter
Cappelli, The Wall Street Journal, November 14, 2013 ---
http://online.wsj.com/news/articles/SB10001424127887324139404579016662718868576?mod=djem_jiewr_AC_domainid
A job after graduation. It's what all
parents want for their kids.
So, what's the smartest way to invest
tuition dollars to make that happen?
The question is more complicated, and more
pressing, than ever. The economy is still shaky, and many graduating
students are unable to find jobs that pay well, if they can find
jobs at all.
The result is that parents guiding their
children through the college-application process—and college
itself—have to be something like venture capitalists. They have to
think through the potential returns from different paths, and pick
the one that has the best chance of paying off.
For many parents and students, the
most-lucrative path seems obvious: be practical. The public and
private sectors are urging kids to abandon the liberal arts, and
study fields where the job market is hot right now.
Schools, in turn, are responding with new,
specialized courses that promise to teach skills that students will
need on the job. A degree in hospital financing? Casino management?
Pharmaceutical marketing?
Little wonder that business majors
outnumber liberal-arts majors in the U.S. by two-to-one, and the
trend is for even more focused programs targeted to niches in the
labor market.
It all makes sense. Except for one thing:
It probably won't work. The trouble is that nobody can predict where
the jobs will be—not the employers, not the schools, not the
government officials who are making such loud calls for vocational
training. The economy is simply too fickle to guess way ahead of
time, and any number of other changes could roil things as well.
Choosing the wrong path could make things worse, not better.
So, how should the venture-capitalist
parents proceed? What should they weigh as they decide where to put
their limited capital to get the biggest bang? Here are some things
to consider. Does the Product Get Out the Door?
You can pick the perfect school in terms of
courses and location and price and ambience. But none of it does a
student any good if he or she doesn't end up with a degree. After
all, college improves job prospects only if a student graduates.
That is why it is crucial to scrutinize the graduation rates at
various schools.
What's more, it is also important to look
at how long it takes students to graduate. Only about 60% of
Division 1 university students graduate in six years, for example.
Many parents and students don't realize
that even top schools differ greatly in their ability to get
students out the door to graduation on time. Consider the difference
between an elite private university like Stanford University and an
elite public university like the University of California, Berkeley.
My colleague Robert Zemsky found that the private school has a much
wider array of support services—counseling, tutoring and so
forth—that vastly improve the odds that a student will actually
graduate, and will do so in four years. An expensive, private school
may end up being cheaper if a student doesn't have to be there as
long.
Probably the most important statistics to
scrutinize are job-placement rates for graduates, but they are often
hard to get and easy to fudge. Are we measuring jobs at graduation,
or within a year after? Do internships count as a "job"?
Statistics about starting salaries, to
judge the quality of those jobs, can be even more elusive. In the
absence of good data, visit the school's career center and see which
employers are actually interviewing students and for what jobs.
Parents and students should push to require
schools to post graduation rates, job-placement rates and other
information on the outcomes for their graduates—especially
considering how many students are now using government-backed loans
to pay for their education. It is not in the public interest for
students to use public funds for vocational degrees that don't have
a good chance of paying off. Today's Jobs Aren't Necessarily
Tomorrow's
The trend toward specialized, vocational
degrees is understandable, with an increasing number of companies
grumbling that graduates aren't coming out of school qualified to
work.
But guessing about what will be hot
tomorrow based on what's hot today is often a fool's errand.
The problem is that the job market can
change rapidly for unforeseeable reasons. Today, we frequently hear
that computers and information technology are and will be the hot
fields, but both have gone from boom to bust over time. Students
poured into IT programs in the late 1990s, responding to the Silicon
Valley boom, only to graduate after 2001 into the tech bust.
Changes in regulations, meanwhile, can
rapidly create and kill fields. For instance, the Sarbanes-Oxley Act
amped up the demand for accountants. Emerging technologies can be
just as disruptive—applicant-tracking software eliminates jobs in
recruiting, while cellphones create programming jobs in mobile
technology. Developments like these are almost impossible to
anticipate.
It gets even more complicated than that.
Let's say governments and colleges could tell what the demand would
be for a particular occupation years out. The problem for someone
making an investment in that occupation is that everyone else has
the same information. That means students will rush to train in that
field, the supply of potential workers goes up, and the jobs are no
longer so attractive.
Consider an email that Texas A&M University
sent to this year's class of incoming petroleum engineers, the
hottest job in the U.S. in terms of starting wages.
The message reminded students that the job
market for engineers has always been competitive and cyclical, and
warned, "Recent data suggests that some concern about the
sustainability of the entry-level job market during a time of
explosive growth in the number of students studying petroleum
engineering in U.S. universities may be prudent."
Unfortunately, that kind of caution isn't
common. Schools want to get as many applicants as possible, and to
get the best ones to attend. Showing parents and students all the
caveats that go with the impressions they create about future jobs
may conflict with those interests. The Danger of Specialization
Another important caveat that doesn't get
discussed much: It may be worse to have the wrong career focus in
college than having no career focus—because skills for one career
often can't be used elsewhere.
Let's say a student spends four years
learning to market pharmaceuticals. But what can he or she do with
that degree if the drug companies aren't hiring? The skills don't
transfer easily anyplace else.
That may even be true within a field.
Anthony Carnevale, of Georgetown's Center on Education and the
Workforce, calculates that the unemployment rate among recent IT
graduates at the moment is actually twice that of theater majors.
Despite the constant complaints from IT employers about skill
shortages, only certain skills within IT are hot at the moment, such
as those associated with mobile communications.
Focusing on a very specific field also
means that you miss out on courses that might broaden your
abilities. Courses that teach, say, hospitality management or sports
medicine may crowd out a logic class that can help students learn to
improve their reasoning or an English class that sharpens their
writing. Both of those skills can help in any field, unlike the
narrowly focused ones.
Beyond those concerns, a narrow educational
focus forces students to pick a career at age 17, before they know
much of anything about their interests and abilities. And if they
choose incorrectly, it can be very difficult for them to start over
once they're older.
Researchers Eric A. Hanushek, Ludger
Woessmann and Lei Zhang find that more vocationally focused
education in high school appears to limit adaptability to changing
labor markets later in life. The same thing may be true in college.
All that said, practical degrees do have
value. But they're not nearly as valuable as boosters say.
Yes, in some fields, like engineering, the
only way in is with a specialized degree. Other things being equal,
students with one of these degrees will have an easier time getting
their first job in the field than students with liberal-arts
degrees. After the first job, though, it is not clear how much
advantage that practical degree has.
Certainly, some matter in part because they
are prestigious—such as a Wharton M.B.A.—but for those that aren't
prestigious, and where the degree isn't required or common, a degree
may not matter at all.
Also consider that what companies really
want hires to have is actual work experience. If they have a choice
between hiring someone fresh out of a hospitality-degree program or
someone who doesn't have that degree but who has run a restaurant,
they will choose the latter. The Way Forward
So, what are the practical lessons for the
venture-investor parent and their child?
Students that go the practical route should
delay choosing majors and specialized courses as long as possible,
so that there is likely to be a better match between course work and
employer interests. Students can rely on real-time information from
the career office to gauge demand. Because of the need to adjust, it
also helps to be at a school where switching majors is easy. Small
programs with limited resources mean that students may have to stay
more than four years to get all the courses that are required for a
new major.
Continued in article
Jensen Comment
Whereas students planning ahead for medical school, accounting careers
engineering careers, etc. facing licensing examinations, it's not
efficient to avoid the requisite specializations in undergraduate
studies.
Law used to be a wonderful career because you could major in
virtually anything and still go to law school. Now the opportunities for
law graduates have shrunk more than raw wool in a boiling cauldron.
MBA programs prefer that students were not undergraduate business
majors. However, opportunities for MBA graduates increase with certain
undergraduate specializations such as computer science, engineering, and
accounting (especially for wannabe tax lawyers).
Fortunately, it is possible to specialize in some programs like
accountancy and still take humanities minors or dual majors.
Increasingly, accounting majors become somewhat proficient in another
language such as Mandarin.
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Gender Pay Gap
From 24/7 Wall Street newsletter on November 6, 2013
The gender wage gap has narrowed over the
years. In 1979, women made an estimated 62% of what men earned. In
2012, the wage of a full-time female employee was roughly 81% of her
male counterpart. While that is good news, in the past 10 years, the
gap has remained more or less unchanged. The size of the remaining
pay inequality depends a great deal on the job. In many of the
largest occupations in the country, women earn close to what men do
on a weekly basis. In others, however, the disparity remains closer
to the 1979 levels. For example, the typical female insurance agent
brought in just 62.5% of her male counterpart in 2012. These
are the jobs with the widest pay gaps between men and women.
Jensen Comment
I don't want to get into hot-button reasons for the gender gap in pay
other than to note that there's considerable evidence in some fields
that the higher pay for men is sometimes due to the male willingness to
work longer hours and/or endure more years of frequent overnight travel
for days on end. Female doctors are more likely to apply
for emergency room duty purportedly when there are eight-hour shifts as
opposed to having to endure long days plus many nights and weekends of
on-call duty endured by non-emergency room physicians. For example,
private-practice physicians cannot always control what time of day their
patients have babies or heart attacks or post-surgery complications.
"Humanities Jobs Decline," by Colleen Flaherty, Inside Higher Ed,
October 30, 2013 ---
http://www.insidehighered.com/news/2013/10/30/mla-sees-decline-job-listings-english-and-languages
Question
What is the world like for some many Ph.D. graduates in medieval history?
"From Welfare to the Tenure Track," by Stacey Patton, Chronicle of
Higher Education, October 25, 2013 ---
https://chroniclevitae.com/news/97-from-welfare-to-the-tenure-track?cid=wb&utm_source=wb&utm_medium=en
Bob Jensen's threads on the job prospect differences between new
accounting doctoral graduates and history doctoral graduates ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#HistoryVsAccountancy
The 10 Purported 10 Best Jobs for a College
Graduate ---
http://www.businessinsider.com/10-best-careers-recent-college-graduates-2013-10?op=1
Jensen Comment
Accountant/Auditor is Number 4 on the list even though it requires 150 approved
credits (usually 2-4 extra semesters in an accounting masters program) to get
permission to take the CPA examination. The list is a bit misleading in that it
does not base the rankings on how hard it is to successfully break into the jobs
on the list.
For example, elementary school teachers have
relatively easy times finding entry-level jobs relative to management
consultants who almost never land entry-level jobs before they gain years of
experience in business and earn one of more specialty certifications. The
majority of graduates from prestigious MBA programs do not necessarily become
management consultants without experience, some of who were experienced in
business or engineering before they entered the MBA programs.
There's also a difference between landing a job and
landing a job in a top firm. For example, the top accounting firms generally
offer entry-level jobs to only the top graduates of a masters program although
the proportion of the class hired varies considerably with the prestige of the
program and the black book maintained by accounting firms on schools where they
recruit. In recent years more women than men are hired by the top accounting
firms. Business firms and small CPA firms tend not to hire new accounting
graduates and wait for moments when prospects have more accounting experience
such as experience as auditors and tax accountants in respected accounting
firms.
The IRS offers great opportunities to new
accounting graduates whereas the FBI hires a lot of accounting graduates only
after they are experienced in business or government.
"Is Law School Worth It?" by Adam Freedman, Legal Aid, February
22, 2013 ---
http://legallad.quickanddirtytips.com/is-law-school-worth-it.aspx
The Smart Grid For Institutions of Higher Education And The
Students They Serve (career in science inspirations and preparation)
---
http://php.aaas.org/programs/centers/capacity/documents/SmartGrid.pdf
"Record-Setting Demand Projected for Accounting Graduates: AICPA
Report Accounting Graduates and Enrollments at Historic Levels, Continuing
Upward Trend, AICPA, June 18, 2013 ---
Click Here
http://www.aicpa.org/Press/PressReleases/2013/Pages/Record-Setting-Demand-for-Accounting-Graduates-AICPA.aspx
Jensen Comment
This increases demand for the relatively-miniscule number of accounting
doctoral graduates in 2013 ---
http://www.jrhasselback.com/AtgDoctInfo.html
Think Texas and Avoid New Hampshire
From the CPA Newsletter on August 27, 2013
Top 10 cities to find a finance, accounting job ---
http://www.accountingweb.com/article/accounting-principals-names-top-ten-cities-finance-jobs/222300
Psst! Want a new job as a Chief Financial Officer
(CFO)?
Then try EBay!
From the CFO Journal's Morning Ledger on
October 22, 2013
Aspiring tech-sector CFOs should check out the
job listings at
eBay.
At least 20 executives who have become finance chiefs in Silicon
Valley and beyond over the past three years have learned the ropes
in the big e-commerce company’s finance department,
CFOJ’s Emily Chasan reports in this must-read
story on B1 today.
“We recruit people who aspire to be CFOs,”
says Robert Swan, eBay’s finance chief since 2006. “If along the way
there are opportunities outside, that’s OK .… We have a deep bench.”
Members of the eBay Mafia—the tongue-in-cheek
name for company veterans who now are corporate-level CFOs—include
Rob Krolik at Yelp,
Douglas Jeffries at
RetailMe Not
and Sean Aggarwal at
Trulia,
who have all taken their companies public in the past two years.
Startups with former eBayers at the financial controls include the
online clothing retailer
ModCloth,
digital-video company
Roku and
online ticketing company
Eventbrite.
One
reason that EBay has churned out so many CFOs is that it has the
resources to invest in grooming up-and-coming financial talent and
the breadth to offer the best prospects hands-on experience running
their own operations. The company says it has about 1,000 financial
executives around the world and more than a dozen divisional and
regional CFOs. Rookies get both theoretical and practical training
in finance, analytics and leadership. And, as part of a two-year
program, eBay rotates star performers to a different division every
six months to expand their professional networks across the company,
Chasan writes.
$53,300: The Average Starting Salary for New Accounting Grads
(in 2013) ---
http://www.naceweb.com/salary-survey-data/?referal=research&menuID=71&nodetype=4
Jensen Comment
I think such starting salary surveys are highly misleading unless they
also show cost of living adjustments. A starting salary of $53,300 will
go a lot further in San Antonio than in San Francisco, NYC, Los Angeles,
and Honolulu where people earning $53,300 should probably get food
stamps and subsidized housing.
I would go to work for $20,000 if the starting job had world class
training and exposures to clients thirsting to hire away CPAs from top
accounting firms.
It's all about windows of opportunity that trump starting salaries in
nearly every instance.
I would not opt for an MBA program were graduates have average
starting salaries of $143,800 (and a high standard deviation and
kurtosis) relative to a Masters of Accounting Program where average
starting salaries are $53,300 with a small standard deviation and
negligible kurtosis. By kurtosis I mean that a few superstar graduates
(such as those with whiz-kid computer science undergraduate degrees from
elite universities) with starting salaries over $250,000 are skewing the
average.
There are also misleading "expected" compensations contingent upon
such things as sales. For example, a marketing or finance job may look
great when told that last year's hires earned an average of $143,800
with commissions and bonuses thrown in. But what about those that came
in below average because they just had a harder time selling products
and services?
Please warn students that the most important thing about a new job is
not the anticipated salary. It's the anticipated opportunity with a few
other factors thrown in such as tension, long hours, geographic
location, and constant travel. For example, a CPA firm may pay double
for going to Moscow, but do you really want to start your career in
Moscow where it's really dangerous on the streets and housing is rather
Spartan?
How to Mislead With Statistics
The Fastest Growing Jobs in the USA ---
Click Here
http://247wallst.com/special-report/2013/08/27/the-10-fastest-growing-jobs-in-america/?utm_source=247WallStDailyNewsletter&utm_medium=email&utm_content=AUG272013A&utm_campaign=DailyNewsletter
Jensen Comment
Students should not flock to some of those careers just because the made
to Top 10 in growth rates. One has to simply look at the total employed
in a given career. For example, there are only 25,000 people employed as
"Music Directors and Composers" and the variance in income is quite
high. This is not really a very viable career choice in terms of
opportunity except for students with exceptional talent.. Similarly,
there are only 32,000 employed as "Skin Care Specialists" with
median annual pay of $28,640. I don't think I would recommend this as
career.
On the other hand there are nearly a million Personal Care Aides. Now
we're talking about opportunity for a job but the median annual salary
is only $19,910 plus food stamps. And I think the work is often vary
difficult and frustrating when dealing with people who need a lot of
help and don't really much appreciate their helpers.
Some of the fastest growing jobs are also dead end jobs with nowhere to
advance without starting over.
"Teen employment hits record lows,
suggesting lost generation," by Kevin G. Hall, McClatchy Report,
August 29, 2013 ---
http://www.mcclatchydc.com/2013/08/29/200769/teen-employment-hits-record-lows.html#.UiMgBz9qDfW
For the fourth consecutive summer, teen employment
has stayed anchored around record lows, prompting experts to fear that a
generation of youth is likely to be economically stunted with lower earnings
and opportunities in years ahead.
The trend is all the more striking given that the
overall unemployment rate has steadily dropped, to 7.4 percent in August.
And employers in recent months have been collectively adding almost 200,000
new jobs a month. It led to hopes that this would be the summer when teen
employment improved.
In 1999, slightly more than 52 percent of teens
16 to 19 worked a summer job. By this year, that number had plunged to about
32.25 percent over June and July. It means that slightly more than three in
10 teens actually worked a summer job, out of a universe of roughly 16.8
million U.S. teens.
“We have never had anything this low in our lives.
This is a Great Depression for teens, and no time in history have we
encountered anything like that,” said Andrew Sum, director of the Center for
Labor Market Studies at Northeastern University in Boston. “That’s why it’s
such an important story.”
Summer is traditionally the peak period of
employment for teens as they are off from school and get their first brush
with employment and the responsibilities that come with it. Falling teen
employment, however, is just as striking in the 12-month numbers over the
past decade.
The picture these teen employment statistics
provide looks even worse when viewed through the complex prism of race. Sum
and colleagues did just that, comparing June and July 2000 and the same two
months of 2013. In 2000, 61.28 percent of white teens 16 to 19 held a job, a
number that fell to 39.25 percent this summer. For African-Americans, a
number that was dismal in 2000, 33.91 percent of 16 to 19 year olds holding
a job, fell to a staggering low of 19.25 percent this June and July.
It wasn’t terribly better for Hispanics, who saw
the percentage of employed teens fall from 40.31 percent in the two-month
period of 2000 to 26.7 percent in June and July 2013.
One of the more surprising findings of Sum’s
research is that teens whose parents were wealthy were more likely to have a
job than those whose parents had less income. Some 46 percent of white male
teens whose parents earned between $100,000 and $149,000 held a job this
summer, compared with just 9.1 percent of black male teens whose family
income was below $20,000 and 15.2 percent for Hispanic teen males with that
same low family income.
That finding is important because a plethora of
research shows that teens who work do better in a wide range of social and
economic indicators. The plunging teen employment rate is likely to mean
trouble for this generation of young workers of all races.
“Kids that get work experience when they are 17 or
18 end up graduating from college at a higher rate,” said Michael Gritton,
executive director of the Workforce Investment Board, which promotes job
creation and teen employment in Louisville, Ky., and six surrounding
counties. “There are economic returns to those young people because they get
a chance to work. Almost every person you ask remembers their first job
because they started to learn things from the world of work that they can’t
learn in the classroom.”
The teen employment numbers are calculated from the
Current Population Survey, carried out by the Census Bureau for the Labor
Department’s Bureau of Labor Statistics. This survey of households is used
in determining estimates for the size of the civilian workforce, the number
of employed nationally and the unemployment rate.
Unemployment data is calculated in a different
fashion, and while it tells a similar story of hardship for teens, it is not
considered by researchers to be as accurate as the employment data because
it underestimates the severity of the slow economy.
The weak employment numbers sometimes prompt a
mistaken narrative that younger workers are just staying in college longer
rather than entering the workforce, or are going on to graduate school given
the impaired jobs market.
“I think there is this myth out there that there is
some silver lining for young people, that they are going on to college. . .
. You don’t see an increase in enrollment rates over and above the long-term
trend. You can’t see a Great Recession blip,” said Heidi Scheirholz, a labor
economist at the liberal Economic Policy Institute, a research group. “They
are not in school. There’s been a huge spike in the not-in-school, not
employed. It’s just a huge missed opportunity.”
Even before the economic crisis exploded in the
summer of 2008, workers ages 16 to 19 made up a declining share of the
overall workforce, in part because of a decades-long climb in college
enrollment, and in part because universities now place less importance on
work and more on life experiences and community service.
But most of this decline in youth in the workforce
is thought to be the result of the severe economic crisis and its aftermath,
with older workers taking the jobs of teens.
Continued in article
Jensen Comment
Teens can do volunteer work for free in the non-profit sector,
but this does
not provide money for school, cars, pregnancies, and moving out of parents'
homes ---
http://www.4-h.org/about/revolution/stories-of-responsibility/citizenship/?cr=redcpcggrofrHScommunityservicegetfirsthand&gclid=CPfXn46JqrkCFcOe4Aod9QMADw
Volunteer work for for charity seldom is the best place for job training
since charities are often seeking "gofer" helpers rather than using their
resources for education and training purposes only. Actual jobs and internships
in the private sector are often better for job training. However, teens cannot
volunteer below minimum wage for work with companies that might provide
higher job skills. They might, however, be able to get unpaid internships in the
nonprofit sector ---
http://www.dol.gov/whd/regs/compliance/whdfs71.pdf
Fact Sheet #71: Internship
Program s Under The Fair Labor Standards Act
This fact sheet provides general information to help determine whether
interns must be paid the minimum wage and overtime under the Fair Labor
Standard s Act for the services that they provide to “for-profit” private
sector employers. Background The Fair Labor Standards Act (FLSA) defines the
term “employ” very broadly as including to “suffer or permit to work.”
Covered and non-exempt individuals who are “suffered or permitted” to work
must be compensated under the law for the services they perform for an
employer. Internships in the “for-profit” private sector will most often
be viewed as employment, unless the test described below relating to
trainees is met. Interns in the “for-profit” private sector who qualify as
employees rather than trainees typically must be paid at least the minimum
wage and overtime compensation for hours worked over forty in a workweek.
The Test For Unpaid Interns
There are some circumstances under which individuals who participate in
“for-profit” private sector internships or training programs may do so
without compensation. The Supreme Court has held that the term "suffer or
permit to work" cannot be interpreted so as to make a person whose work
serves only his or her own interest an employee of another who provides aid
or instruction. This may apply to interns w ho receive training for their
own educational benefit if the training meets certain criteria. The
determination of whether an internship or training program meets this
exclusion depends upon all of the facts and circumstances of each such
program. The following six criteria must be applied when making this
determination:
1. The internship, even though it includes
actual operation of the facilities of the employer, is similar to
training which would be given in an educational environment;
2. The internship experience is for the benefit
of the intern;
3. The intern does not displace regular
employees, but works under close supervision of existing staff;
4. The employer that provides the training
derives no immediate advantage from the activities of the intern; and on
occasion its operations may actually be impeded;
5. The intern is not necessarily entitled to a
job at the conclusion of the internship; and
6. The employer and the intern understand that
the intern is not entitled to wages fo r the time spent in the
internship. If all of the factors listed above are met, an employment
relationship does not exist under the FLSA, and the Act’s minimum wage
and overtime provisions do not apply to the intern. This exclusion from
the definition of employment is necessarily quite narrow because the
FLSA’s definition of “employ” is very broad. Some of the most commonly
discussed factors for “for-profit” private sector internship programs
are considered below.
Continued in article
Jensen Comment
In the budget squeeze since the 2008 recession, organizations are likely to
offer less and less of internship training that meet the above Labor Department
tests for non-compensated internships. The reason is that the above internships
will drain resources for the benefit of interns without any cost savings in
labor.
Thus in the USA teens face fewer and fewer jobs and internships. In Germany,
however, employers are given more incentives to hire teens in apprenticeships.
"The Secret To Germany's Low Youth Unemployment," by Eric Westervelt,
NPR, April 4, 2013 ---
http://www.npr.org/2012/04/04/149927290/the-secret-to-germanys-low-youth-unemployment
For as long as he can remember, German teenager
Robin Dittmar has been obsessed with airplanes. As a little boy, the sound
of a plane overhead would send him into the backyard to peer into the sky.
Toys had to have wings. Even today, Dittmar sees his car as a kind of ersatz
Boeing.
"I've got the number 747 as the number plate of my
car. I'm really in love with this airplane," the 18-year-old says.
Less-than-perfect school grades dashed Dittmar's
dream of becoming a commercial pilot. But they were good enough to earn him
a coveted apprenticeship slot with Lufthansa Technik, the technical arm of
Europe's largest airline, responsible for aircraft maintenance and repair
across the globe.
One-third of the way through his three-and-a-half
years of training at Lufthansa technical headquarters in Hamburg, Dittmar is
honing the skills required to become an aircraft mechanic — and
all-but-guaranteeing himself a job.
The protracted European debt crisis and austerity
measures have made career prospects for many of the continent's youth
bleaker than ever. In and , nearly half of all those under age 25 are
unemployed.
But as Dittmar's experience illustrates, that's not
the case in Germany. In stark contrast, Germany's youth employment is the
highest in Europe, with only a 7.8 percent jobless rate. At the heart of
that success is a learn-on-the-job apprenticeship system that has its roots
in the Middle Ages but is thriving today in Germany's modern,
export-oriented economy.
On-The-Job Training
A brightly lit Lufthansa workshop in Hamburg is
part of that apprenticeship system. Teenagers like Dittmar, many dressed in
the company's navy blue shirts and overalls, are busy learning the basics:
drilling, filing, soldering and manipulating sheet metal.
Dittmar's apprenticeship is part of Germany's
well-established and successful "dual system," so-called because training is
done both in-house at a company and partly at local vocational colleges.
About two-thirds of his time is spent on the job at
Lufthansa — split between workshops and classrooms, and actually working on
real aircraft and engines supervised by an experienced full-time mechanic, a
"training buddy."
"[The training buddies] are taking the apprentice
with them in their work. They are integrating them in their work and they
are making real training on the job," says Hans-Peter Meinhold, Lufthansa's
head of vocational training. "So it's a one-to-one
situation."
For an aviation buff like Dittmar, getting to work
on real machines so soon is not only a sign that his employers see potential
in him, but also fuels his passion for planes.
"I could work anyplace in the world. I like the
system here," the teenager says. "I know that I will be a good aircraft
mechanic when I'm out of the apprenticeship, so that's very cool to know."
About 60 percent of German high school graduates
travel the same path as Dittmar, choosing vocational over academic
education. Throughout his training, Lufthansa pays Dittmar the equivalent of
$1,000 a month, one-third of the starting wage a qualified mechanic would
get. That's part of the system that some foreign visitors can't comprehend,
director Meinhold says.
"I tell them [the apprentices] don't pay anything
for it, they get paid by the companies. They get money for their training,"
Meinhold says. "'You are training them and you are paying them for that?'
They can't understand this."
Once qualified, these skilled aeronautical and
engine mechanics feed into a fairly robust European aviation industry,
either directly at Lufthansa or at one of its subsidiaries or competitors.
For many, the potential of being hired permanently
is the key attraction. Germany's industry still offers a majority of skilled
workers the elusive "job for life," a long-gone legend in many other Western
countries.
Meinhold believes that despite the costs, the
apprentice system is an investment vital to the ongoing success of Germany's
export-dependent economy by creating loyal, well-trained employees.
"It's a quite expensive way we go," he says. "The
benefit we get from the system later, that's a great benefit and makes
everything economical."
A Model For The Rest Of Europe?
Germany's dual system trains 1.5 million people
annually. Across the board, from bakers and car mechanics to carpenters and
violin-makers, about 90 percent of apprentices successfully complete their
training, German government figures show. The apprenticeships vary in
length, between two and three-and-a-half years. The average training
"allowance" is 680 euros a month (approximately $900), and about half of the
apprentices stay on in the company that trained them.
British Prime Minister David Cameron recently
called for his country to emulate parts of the German system by
reinvigorating British apprenticeships with higher-level training.
Continued in article
"How to Stop the Drop in American Education: Your math
teacher was right: Algebra matters. Common Core standards are vital too,"
by Rex Tillerson (Exxon Mobil CEO), The Wall Street Journal,
September 5, 2013 ---
http://online.wsj.com/article/SB10001424127887324747104579024892381188288.html?mod=djemEditorialPage_h
With headlines announcing unemployment
rates above 8% in some parts of the country, many people I talk to
are surprised to learn that jobs by the hundreds of thousands remain
vacant.
The reason for that is clear: American
employers do not have enough applicants with adequate skills,
especially in science, technology, engineering and math. The
"STEM-related" positions that U.S. industry needs to fill are not
just for biochemists, biophysicists and engineers. More and more
jobs are applying cutting-edge technologies and now demand deeper
knowledge of math and science in positions that most people don't
think of as STEM-related, including machinists, electricians, auto
techs, medical technicians, plumbers and pipefitters.
In fact, after more than 30 years working
in the energy industry, and now as I work with business leaders from
every sector of the American economy, I can attest that your
high-school math teacher was right: Algebra matters.
These days the energy industry tests for
math and science aptitude when hiring for entry-level positions. Our
industry is seeking to fill positions that range from mechanics and
lab support to blend and process technicians. But many applicants
fail these basic tests, losing out on opportunities for good pay and
good benefits.
The U.S. military is also being forced to
turn away applicants because of a lack of preparation in math,
science and other subjects. Each year, approximately 30% of
high-school graduates who take the Armed Forces entrance exam fail
the test.
Even more concerning, many of these
educational shortfalls are apparent before students reach high
school. According to the 2011 National Assessment of Educational
Process, only 35% of eighth graders performed at grade level or
above in math.
As a nation, we must unite in recognizing
the mounting evidence that the U.S. is falling behind international
competitors in producing students ready for 21st-century jobs.
According to the most recent Program for International Assessment,
U.S. students rank 14th in the world in reading, 17th in science and
25th in math—and the trend line is moving in the wrong direction.
We have an opportunity to reverse this
trend but it will take setting the right priorities. That starts
with establishing high standards. It means leaders from government
and business, and parents, need to defend the Common Core State
Standards, which have been adopted wholly or in part by dozens of
states in recent years but are increasingly under attack from across
the political spectrum.
These voluntary, state-driven standards are
a set of expectations for the knowledge and skills that students
from kindergarten to 12th grade need to master for college and
career readiness. Some oppose the standards, complaining that they
undermine the autonomy of teachers; others decry the standards as a
takeover of local schools by big government.
The criticism is misguided. The Common Core
State Standards are based on the best international research. They
are built on the standards used by the most effective education
systems around the world, including Singapore, Finland, Canada and
the U.K. The standards are also designed to allow each state to make
its own decisions regarding the curriculum, technology and lesson
plans to be used in local schools.
In other words, the standards stipulate
what we want all students to know and be able to do, but each state
retains the explicit authority to determine how it teaches its
students. The standards are a tool to help educators, not a
straitjacket for them.
A major benefit of the Common Core State
Standards is that they encourage students to analyze and apply
critical reasoning skills to the texts they are reading and the math
problems they are solving. These are the capabilities that students
need as they prepare for high-skill jobs.
We need to raise expectations at every
grade level so that, for instance, students who do well in math in
lower grades are spurred to take algebra and more advanced math. But
we need high standards to drive efforts to improve educational
outcomes in every subject.
With these education standards under attack
in many states where they have been adopted or are being considered,
the Common Core needs support now more than ever if America is going
to reverse its education decline and prepare its young people to
compete in today's dynamic global economy. To abandon the standards
is to endanger America's ability to create the technologies that
change the world for the better.
The Common Core State Standards are the
path to renewed competitiveness, and they deserve to be at the
center of every state's effort to improve the education—and
future—of every American child.
Mr. Tillerson is the chairman and CEO of Exxon Mobil Corp.
and the chairman of the Business Roundtable's Education & Workforce
Committee.
$53,300: The Average Starting Salary for New Accounting Grads
---
http://www.naceweb.com/salary-survey-data/?referal=research&menuID=71&nodetype=4
Jensen Comment
I think such starting salary surveys are highly misleading unless they
also show cost of living adjustments. A starting salary of $53,300 will
go a lot further in San Antonio than in San Francisco, NYC, Los Angeles,
and Honolulu where people earning $53,300 should probably get food
stamps and subsidized housing.
I would go to work for $20,000 if the starting job had world class
training and exposures to clients thirsting to hire away CPAs from top
accounting firms.
It's all about windows of opportunity that trump starting salaries in
nearly every instance.
I would not opt for an MBA program were graduates have average
starting salaries of $143,800 (and a high standard deviation and
kurtosis) relative to a Masters of Accounting Program where average
starting salaries are $53,300 with a small standard deviation and
negligible kurtosis. By kurtosis I mean that a few superstar graduates
(such as those with whiz-kid computer science undergraduate degrees from
elite universities) with starting salaries over $250,000 are skewing the
average.
There are also misleading "expected" compensations contingent upon
such things as sales. For example, a marketing or finance job may look
great when told that last year's hires earned an average of $143,800
with commissions and bonuses thrown in. But what about those that came
in below average because they just had a harder time selling products
and services?
Please warn students that the most important thing about a new job is
not the anticipated salary. It's the anticipated opportunity with a few
other factors thrown in such as tension, long hours, geographic
location, and constant travel. For example, a CPA firm may pay double
for going to Moscow, but do you really want to start your career in
Moscow where it's really dangerous on the streets and housing is rather
Spartan?
The downloadable Robert Half salary guide ---.
http://www.roberthalf.com/SalaryGuide
SAT College Admissions Test ---
http://en.wikipedia.org/wiki/SAT
ACT College Admissions Test ---
http://en.wikipedia.org/wiki/ACT_%28test%29
Only 43% of SAT test takers are prepared to start college ---
http://research.collegeboard.org/programs/sat/data/cb-seniors-2013
Khan Academy Test Prep Helpers for SAT. ACT, GMAT, MCAT, etc. ---
https://www.khanacademy.org/library
Scroll Down to Test Prep
Jensen Comment
And those who are the least prepared resist taking the SAT test. They intead opt
for the ACT test having easier questions.
"Why Do Would-Be Business Majors Bomb on the SAT?" by Louis
Lavell, Bloomvberg Businessweek, September 27, 2013 ---
http://www.businessweek.com/articles/2013-09-27/why-do-would-be-business-majors-bomb-on-the-sat
According to the latest College Board
report (PDF)
on SAT scores, college-bound seniors who
intend to major in business had some of the lowest scores around.
Among a dozen prospective majors accounting
for the most test-takers, only three scored lower on writing and
critical reasoning: health professions, education, and security and
protective services. Would-be business majors fared well on math,
but even there they got creamed by biology, engineering, and
computer science. Ten years ago, the picture wasn’t all that
different.
There are any number of reasons why college
applicants with less-than-great SAT scores would gravitate toward
business—including assumptions that business programs are less
selective than other majors, easier than other programs, or more
likely to result in gainful employment.
But it may be far simpler than that.
Steve Schneider, a school counselor for 17 years who works at
Sheboygan South High School in Sheboygan, Wis., says he believes the
problem may be that many would-be business majors don’t know why
they’re going to college and probably don’t belong there. They
choose business mainly to satisfy parents and others who are
pressuring them about their college plans.
“I think ‘business’ is a default answer,”
Schneider says. “It’s the answer of least resistance.”
Many students who end up in business
programs in four-year colleges, where about 40 percent of all
students ultimately drop out, are probably better-suited to
community colleges, career programs at technical schools, and
certification programs, Schneider says. The low SAT scores, he says,
are the result of too many kids starting down the wrong path. “Is it
an indicator that kids aren’t as smart as they should be?” he asks.
“I think it’s an indicator that there are more kids taking that test
than need to be.”
Ruth Lohmeyer, a counselor at Lincoln
Northeast High School in Lincoln, Neb., for the past 11 years,
agrees. While most of the students at Northeast take the ACT, not
the SAT, she says many of them graduate intending to major in
business, which they view as “a good major to have if you don’t know
what you want to do.”
“Students that I’ve worked with perceive it
as a degree they can complete,” says Lohmeyer, who counsels many
students in poverty who will be the first in their families to
attend college. “It’s a degree that is [seen as] generic—they can
have a business degree and use it in many different career fields.”
If that’s the case, it might help explain
some of the shortcomings of business programs themselves.
According to the
National Survey of
Student Engagement, 42 percent of senior
business majors spend fewer than 11 hours a week studying, a
greater percentage than in any other major.
Jensen Comment
Except for accounting and finance concentrations, undergraduate business
graduates from college do ;poorly in terms of unemployment and expected
salary levels ---
"From College Major to Career" ---
http://graphicsweb.wsj.com/documents/NILF1111/#term=
Poor career placement immediately after graduation mostly likely due in
part to having worse average SAT scores about business students. Of
course there is much variation between universities and geography and
tracking into graduate schools. I suspect that students with low SAT
scores also tend to eventually have low LSAT, GMAT, and GRE scores later
on when applying for graduate studies. Business management has the
highest "Popularity" in terms of numbers of undergraduate majors. The
table below ignores the length of time it takes a graduate to finally
get career job other than part-time non-career McJobs. Timing varies a
great deal by major and graduate studies.
Averages are hurt by lower gpa graduates relative
top graduates' unemployment and earnings.
Major
Field (2010 Census Data) |
Unemployment Percent
|
25th %
Earnings |
Median %
Earnings |
75th %
Earnings |
Popularity
|
ACCOUNTING
|
5.4% |
$41,000
|
$61,000
|
$94,000
|
3 |
ACTUARIAL SCIENCE
|
0.0% |
$52,000
|
$81,000
|
$116,000
|
150 |
ADVERTISING AND PUBLIC RELATIONS
|
6.1% |
$36,000
|
$50,000
|
$74,000
|
41 |
AEROSPACE ENGINEERING
|
3.6% |
$60,000
|
$84,000
|
$111,000
|
105 |
AGRICULTURAL ECONOMICS
|
1.3% |
$30,000
|
$57,000
|
$99,000
|
122 |
AGRICULTURE PRODUCTION AND MANAGEMENT
|
3.0% |
$32,000
|
$48,000
|
$71,000
|
75 |
ANIMAL SCIENCES
|
5.7% |
$26,000
|
$40,000
|
$60,000
|
67 |
ANTHROPOLOGY AND ARCHEOLOGY
|
6.9% |
$30,000
|
$40,000
|
$60,000
|
55 |
APPLIED MATHEMATICS
|
4.1% |
$52,000
|
$71,000
|
$100,000
|
131 |
ARCHITECTURAL ENGINEERING
|
5.8% |
$50,000
|
$71,000
|
$96,000
|
140 |
ARCHITECTURE
|
10.6% |
$37,000
|
$60,000
|
$85,000
|
33 |
AREA ETHNIC AND CIVILIZATION STUDIES
|
5.7% |
$34,000
|
$48,000
|
$76,000
|
66 |
ART AND MUSIC EDUCATION
|
4.2% |
$32,000
|
$41,000
|
$51,000
|
48 |
ART HISTORY AND CRITICISM
|
6.9% |
$33,000
|
$45,000
|
$71,000
|
81 |
ASTRONOMY AND ASTROPHYSICS
|
0.0% |
$56,000
|
$62,000
|
$101,000
|
170 |
ATMOSPHERIC SCIENCES AND METEOROLOGY
|
1.6% |
$40,000
|
$68,000
|
$101,000
|
146 |
BIOCHEMICAL SCIENCES
|
7.1% |
$30,000
|
$48,000
|
$80,000
|
87 |
BIOLOGICAL ENGINEERING
|
6.8% |
$39,000
|
$60,000
|
$94,000
|
126 |
BIOLOGY
|
5.6% |
$35,000
|
$51,000
|
$76,000
|
14 |
BIOMEDICAL ENGINEERING
|
5.9% |
$45,000
|
$68,000
|
$101,000
|
137 |
BOTANY
|
6.9% |
$26,000
|
$40,000
|
$55,000
|
147 |
BUSINESS ECONOMICS
|
5.0% |
$44,000
|
$71,000
|
$101,000
|
80 |
BUSINESS MANAGEMENT AND
ADMINISTRATION |
6.0% |
$38,000
|
$56,000
|
$85,000
|
1
|
CHEMICAL ENGINEERING
|
3.8% |
$60,000
|
$86,000
|
$117,000
|
49 |
CHEMISTRY
|
5.1% |
$39,000
|
$59,000
|
$85,000
|
36 |
CIVIL ENGINEERING
|
4.9% |
$55,000
|
$76,000
|
$101,000
|
32 |
CLINICAL PSYCHOLOGY
|
19.5% |
$25,000
|
$40,000
|
$61,000
|
168 |
COGNITIVE SCIENCE AND BIOPSYCHOLOGY
|
4.5% |
$36,000
|
$43,000
|
$91,000
|
167 |
COMMERCIAL ART AND GRAPHIC DESIGN
|
8.1% |
$31,000
|
$45,000
|
$69,000
|
21 |
COMMUNICATION DISORDERS SCIENCES AND
SERVICES |
3.3% |
$32,000
|
$41,000
|
$50,000
|
98 |
COMMUNICATION TECHNOLOGIES
|
6.7% |
$33,000
|
$50,000
|
$73,000
|
89 |
COMMUNICATIONS
|
6.3% |
$35,000
|
$50,000
|
$81,000
|
7 |
COMMUNITY AND PUBLIC HEALTH
|
4.1% |
$31,000
|
$46,000
|
$70,000
|
110 |
COMPOSITION AND SPEECH
|
7.7% |
$30,000
|
$40,000
|
$61,000
|
99 |
COMPUTER ADMINISTRATION MANAGEMENT
AND SECURITY |
9.5% |
$39,000
|
$52,000
|
$75,000
|
114 |
COMPUTER AND INFORMATION SYSTEMS
|
5.6% |
$44,000
|
$62,000
|
$86,000
|
31 |
COMPUTER ENGINEERING
|
7.0% |
$58,000
|
$81,000
|
$102,000
|
47 |
COMPUTER NETWORKING AND
TELECOMMUNICATIONS |
5.2% |
$35,000
|
$53,000
|
$76,000
|
97 |
COMPUTER PROGRAMMING AND DATA
PROCESSING |
6.2% |
$39,000
|
$55,000
|
$84,000
|
121 |
COMPUTER SCIENCE
|
5.6% |
$50,000
|
$77,000
|
$102,000
|
10 |
CONSTRUCTION SERVICES
|
5.4% |
$49,000
|
$65,000
|
$101,000
|
76 |
COSMETOLOGY SERVICES AND CULINARY
ARTS |
7.3% |
$26,000
|
$41,000
|
$60,000
|
115 |
COUNSELING PSYCHOLOGY
|
5.2% |
$23,000
|
$34,000
|
$42,000
|
133 |
COURT REPORTING
|
4.9% |
$36,000
|
$55,000
|
$81,000
|
151 |
CRIMINAL JUSTICE AND FIRE PROTECTION
|
4.7% |
$36,000
|
$50,000
|
$73,000
|
13 |
CRIMINOLOGY
|
5.2% |
$35,000
|
$50,000
|
$71,000
|
92 |
DRAMA AND THEATER ARTS
|
7.1% |
$28,000
|
$40,000
|
$60,000
|
45 |
EARLY CHILDHOOD EDUCATION
|
4.1% |
$28,000
|
$37,000
|
$45,000
|
50 |
ECOLOGY
|
5.2% |
$31,000
|
$43,000
|
$60,000
|
109 |
ECONOMICS
|
6.3% |
$42,000
|
$69,000
|
$108,000
|
16 |
Source: Georgetown University Center on Education and
the Workforce
Deloitte (DTTL) and the International Association for Accounting
Education and Research (IAAER) today announced the Deloitte IAAER
Scholarship Programme, naming five associate professors from Brazil,
Indonesia, Poland, Romania and South Africa as the programme’s inaugural
scholars.
IAS Plus
February 13, 2013
http://www.iasplus.com/en/news/2013/02/deloitte-scholars
Mentors will be assigned to each scholar to
support them as they increase their exposure to internationally
recognised accounting scholars, best practices in accounting and
business education and research, and a global peer network.
Ongoing mentorship is a critical element of
the Deloitte IAAER Scholarship Programme and some well-known and
highly accomplished accounting experts have volunteered their
support. These include former member of the Financial Accounting
Standards Board, Katherine Schipper (Duke University); former member
of the International Accounting Standards Board, Mary Barth
(Stanford University); Chika Saka (Kwansei Gakuin University);
Sidney Gray (University of Sydney); and Ann Tarca (University of
Western Australia).
The scholars, who must be a sitting
lecturer, assistant, or associate professor holding a PhD (or
comparable degree) in a faculty that teaches accounting, auditing,
or financial reporting, are chosen for three years and attend IAAER
co-sponsored conferences, workshops, and consortia as well as the
IAAER World Congress.
In the long term, the programme aims at
supporting better accounting education and improving the quality of
financial reporting and auditing. The next round of scholarships
will open in 2016, with applications considered in 2015.
Bob Jensen's helpers for accounting educators ---
http://faculty.trinity.edu/rjensen/default3.htm
Bob Jensen's helpers for accounting researchers ---
http://faculty.trinity.edu/rjensen/default4.htm
Bob Jensen's threads ---
http://faculty.trinity.edu/rjensen/threads.htm
Career Ladder to Nowhere
"All LinkedIn with Nowhere to Go," by Ann Friedman,
The Baffler,
No. 23, 2013 ---
http://www.thebaffler.com/past/all_linkedin_with_nowhere_to_go
. . .
This frenetic
networking-by-vague-association has bred a mordant skepticism among
some users of the site. Scott Monty, head of social media for the
Ford Motor Company, includes a disclaimer in the first line of his
LinkedIn bio that, in any other context, would be a hilarious
redundancy: “Note: I make connections only with people whom I have
met.” It’s an Escher staircase masquerading as a career ladder.
On one level, of course, this world of
aspirational business affiliation is nothing new. LinkedIn merely
digitizes the core, and frequently cruel, paradox of networking
events and conferences. You show up at such gatherings because you
want to know more important people in your line of work—but the only
people mingling are those who, like you, don’t seem to know anyone
important. You just end up talking to the sad sacks you already
know. From this crushing realization, the paradoxes multiply on up
through the social food chain: those who are at the top of the field
are at this event only to entice paying attendees, soak up the
speaking fees, and slip out the back door after politely declining
the modest swag bag. They’re not standing around on garish hotel
ballroom carpet with a plastic cup of cheap chardonnay in one hand
and a stack of business cards in the other.
LinkedIn does have some advantages over the
sad old world of the perennially striving, sweating minor characters
in Glengarry Glen Ross. After all, it doesn’t require a registration
fee or travel to a conference center. Sometimes there are recruiters
trolling the profiles on the site. It’s a kinder, gentler experience
for the underemployed. It distills the emotionally fraught process
of collapsing years of professional experience onto a single 8½ x 11
sheet of paper into the seemingly more manageable format of the
online questionnaire. In the past year, the site has made the
protocols of networking even more rote, allowing users to select
from a list of “skills” and, with a few clicks, declare their
proficiency. “You can add up to 50 relevant skills and areas of
expertise (like ballet, iPhone and global business development),”
chirps an infobox on the site.
A century or so ago, critics worried that
the rise of scientific management in the industrial workplace would
deskill the American worker; now, in the postindustrial order of
social-media-enabled employment, skills (or, you know, quasi-skills)
multiply while jobs stagnate. Sure, you probably won’t get hired at
most places on the basis of your proficiency in ballet—but if you’re
so inclined, you can spend some of your ample downtime on LinkedIn
endorsing the iPhone skills of select colleagues and acquaintances.
These Thoughts for Hire
LinkedIn’s architects are self-aware enough
to know that, even in the age of social-media following, some of us
must be leaders. In October, the site enabled users to “follow” a
handpicked set of “thought leaders.” LinkedIn has given this “select
group” permission “to write long-form content on LinkedIn and have
their words and sharing activity be followed by our 187 million
members.” So far, 190 leaders have made the cut. The “most-followed
influencers” are familiar names to anyone who’s ever killed time in
an airport bookstore: Richard Branson, Deepak Chopra, Arianna
Huffington, Tony Robbins.
The animating vision behind the thought
leader initiative is that great digital-economy will-o’-the-wisp
known as the flattened hierarchy. “It used to be that the only way
to hear what someone had to say on LinkedIn was to ask to connect
with them. And you’re supposed to only do that with people you know
and have done business with,” Isabelle Roughol, one of LinkedIn’s
editors, wrote me in an email. “The average professional won’t chat
at the coffee machine with someone like [Virgin Group founder]
Richard Branson, but we still want to know how he got his start in
business, how he manages his team or why he thinks private space
travel is the future. That’s the space our ‘Influencers’ program
fills.”
Continued in article
The social media backlash may be starting.
People in their 30s are quitting Facebook and Twitter, and LinkedIn is reaching
down to students. This could just be the start ---
Click Here
http://247wallst.com/media/2013/09/23/is-the-social-media-backlash-taking-hold-facebook-linkedin-twitter-have-to-care/?utm_source=247WallStDailyNewsletter&utm_medium=email&utm_content=SEP242013A&utm_campaign=DailyNewsletter
"Facebook and Twitter Are Converging:
The two largest social networks are becoming more similar, as they borrow each
other’s features, and search for profit," by Tim Simonite, MIT's Technology Review, September 13, 2013 ---
Click Here
http://www.technologyreview.com/view/519296/facebook-and-twitter-are-converging/?utm_campaign=newsletters&utm_source=newsletter-daily-all&utm_medium=email&utm_content=20130916
"Social Media: Ten Things Accountants Should Never Do," by Mark Lee,
AccountingWeb, May 23, 2013 ---
Click Here
http://www.accountingweb.com/article/social-media-ten-things-accountants-should-never-do/221837?source=technology
Bob Jensen's threads on social media ---
http://faculty.trinity.edu/rjensen/ListservRoles.htm
June 1, 2013 message from Bryce Walker
Hi Bob,
After recently passed the CPA exam, I
created a website to help others avoid the same mistakes I made. I
wrote an article to help inspire accounting students that plan on
pursuing a CPA license and to let them know that all their hard work
will pay off in the end.
http://crushthecpaexam.com/becoming-a-cpa/
If you find value in my article I would
love to be listed on your bookmarks page as I think many others
would find my story motivating. Thanks for you time,
Bryce
Bryce Welker, CPA
CRUSHtheCPAexam.com
Bob Jensen's threads on accounting careers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Applicants for academic jobs, particularly
in the humanities, know instinctively—and by the job offers that never
materialize—that they face tough competition in trying to get
tenure-track positions. And when the odds are sometimes as high as
600 to one, as they were for a recent opening for assistant
professor in the department of political science at the University of
Wisconsin at Madison, candidates have no way of knowing exactly whom
they are up against or how they stack up.
"The Long Odds of the Faculty Job Search," by Audrey Williams
June, Chronicle of Higher Education, May 19, 2013 ---
http://chronicle.com/article/The-Long-Odds-of-the/139361/?cid=wb
Bob Jensen compares (with data) searching for an accounting
faculty position versus a history faculty position at
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#HistoryVsAccountancy
"11 Reasons Why Getting An MBA (from a prestigious program) Is
Better Than Getting A CFA," by Linette Lopez, Business Insider, May
24, 2013 ---
http://www.businessinsider.com/getting-an-mba-better-than-getting-a-cfa-2013-5
Jensen Comment
I'm not certain there's a whole lot of value in this apples versus
tomatoes comparison. Ms. Lopez makes an underlying assumption that CFAs
are primarily backroom analysts. I'm reminded of a neighbor I had in
Maine who was a CFA who made a lot of money as the owner of an insurance
and investment services company.
She also makes an implicit assumption that the MBA degree is from a
prestigious MBA program like an Ivy League MBA degree. Actually, most
MBA degrees are from somewhat less prestigious state universities that
have much more variability in terms of student networking, ties with
powerful alumni, employment opportunities, and faculty consulting at
high levels in corporations. A lot more of those MBAs are in
unemployment lines or stuck in the same jobs they had before entering an
MBA program.
Also complicating the issue is that a lot of CFAs are also MBAs who
later elected to specialize for better jobs in the financial services
industry.
I also feel that it would be misleading to compare CPA versus CFA
careers. The main problem is variability. For example, there's a huge
difference between being a Big 10 CPA firm partner versus being a solo
practitioner with mostly tax clients in Bangor, Maine. Similarly,
there's a world of difference between being a CFA in a large Wall Street
bank versus being a solo practitioner selling insurance and financial
services in Bangor, Maine.
Annual income can be a poor basis of comparison since some
professionals in a small town in the USA make ten times more than their
counterparts in big CPA firms and banks. There's a lot of serendipity in
life.
"Job Interview Questions That Will Catch You Off Guard," by Marissa
Brassfield, Payscale, March 12, 2013 ---
Click Here
http://blogs.payscale.com/salary_report_kris_cowan/2013/03/job-interview-questions-that-will-catch-you-off-guard.html?utm_medium=Email&utm_source=ExactTarget&utm_campaign=0313_newsletter_02&utm_term=http%3a%2f%2fblogs.payscale.com%2fsalary_report_kris_cowan%2f2013%2f03%2fjob-interview-questions-that-will-catch-you-off-guard.html&cm_mmc=Email-_-0313_newsletter_02-_-NA-_-http%3a%2f%2fblogs.payscale.com%2fsalary_report_kris_cowan%2f2013%2f03%2fjob-interview-questions-that-will-catch-you-off-guard.html
Job interview questions are often standard,
allowing you to prepare all your answers before you meet with your
new potential employer. But some companies like to ask questions
that throw you completely off-guard.
Randy Garutti, the CEO of burger franchise
Shake Shack, asks potential new employees to predict the future: "If
we're sitting here a year from now celebrating what a great year
it's been for you in this role, what did we achieve together?"
Garutti says the point of this question is to see if interviewees
have done their homework. In fact, he actually wants them to
interview him. "The candidate should have enough strategic vision to
not only talk about how good the year has been but to answer with an
eye towards that bigger-picture understanding of the company."
Meanwhile, Ryan Holmes, the CEO of social
media tool HootSuite, wants candidates to use their imaginations. He
often asks, "What's your superpower? and "What's your spirit
animal?" His current executive assistant answered the second
question, saying a duck because they seem calm, but underneath the
surface they are always moving. "I think this was an amazing
response and a perfect description for the role of an EA," Holmes
says.
The CEO of recruiting software Bullhorn,
Art Papas, already knows a lot about finding the right candidates,
so he asks a question that most employers never think about: "What
things do you not like to do?" Papas says it often takes a few tries
before an interviewee is willing to answer honestly, but the answer
reveals a lot about candidates and shows if they are really cut out
for the job.
Eric Ripert, chef and co-owner and Le
Bernardin in New York City, likes to keep the creative process going
in job interviews. He looks for certain characteristics like
discipline and passion by making the interview more of a
conversation. "I ask indirect questions about the creative process,
about articulating and demystifying the process of creating great
food and great service. Then I trust my instincts," he says.
Continued in article
Jensen Comment
My economist colleague, Bill Breit, always like to ask:
"If you could have a long private dinner with any person living or dead,
who would you choose and why?"
The important answer is not so much who but why.
Accounting professor Joe Hoyle likes to ask:
"What is the best book you ever read?"
"What Is the Best Book You Ever Read?" by Joe Hoyle, Teaching Blog, June 23, 2012 ---
http://joehoyle-teaching.blogspot.com/2012/06/what-is-best-book-you-ever-read.html
Jensen Comment
Firstly I don't like this question because many readers who answer this
question, especially in public, will be trying to say something about
themselves instead of the book. To your Mom and your kids, the best book
you ever read had better be The Bible or The Quran.
To your blog audience the best book you ever read from cover to cover
had better be Toynbee's ten-volume set ---
http://en.wikipedia.org/wiki/Arnold_J._Toynbee
Secondly, such a question should be asked in one of a hundred or more
contexts. What is the best book you ever read in accounting history,
financial accounting, cost accounting, tax accounting, accounting
information systems, history of computing, learning and cognition, etc.
What is the best mystery novel you've ever read, the best romantic
novel you ever read, the best biography you ever read, and on and on and
on.
Beware of those oral interviews when applying for a job or college
admission or membership in an exclusive club. Be prepared for those
trick questions such as the examples given below:
- What is your all-time favorite book?
- What are the best three books you ever read? (don't overlook the
autobiography of the founder of the company or university)
- If you could've had an intimate dinner with three people, living
or dead who would you choose and why? (this demands creative
thought)
- Who was your favorite K-12 teacher and why?
- Who was your favorite athletic coach and why?
- Who was your was your favorite college professor and why?
- Who was your least favorite college professor and why?
- Who is your favorite active in an academic blog and why?
- Who is your favorite active in a non-academic blog and why?
- Who is your favorite blogger in the NYT, the WSJ, the New
Yorker, the Economist, MSNBC, CNBC, the Nation, and on
and on and on?
- If you have online debates, who is your favorite antagonist and
why?
- If you have online debates, who is your favorite protagonist and
why?
- Who is your favorite intellectual progressive?
- Who is your favorite intellectual conservative?
In the end the choices at the top and bottom of your lists on most
any topic are just too close together to rank. And your choices are not
locked in time or place.
Conclusion
Of course my favorite set of books is Toynbee's ten-volume set.
Oops! Sorry Mom, I overlooked The Bible.
From the Stanford Graduate School of Business
5 Attitudes of Successful Entrepreneurs, from Professor Irv
Grousbeck ---
http://stanfordbusiness.tumblr.com/post/52905655004/5-attitudes-of-successful-entrepreneurs-from-professor
Jensen Comment
We must acknowledge that successful entrepreneurs, like successful CEOs
of public companies, have flaws that are generally offset by tremendous
offsetting traits. For example, I don't know of any analysts that credit
Steve Jobs for skills in managing people. Steve was a genius at managing
products.
Also too little credit is given to the serendipity of "success" that
comes from being in the right place at the right time. A perfect
combination of the five "attitudes" mentioned by Professor Grousbeck are
only a small part of "success."
"Tax Professionals Will
Continue To Be in Great Demand for Years," by Frank Byrt,
AccountingWeb, March 3, 2013 ---
http://www.accountingweb.com/article/tax-professionals-will-continue-be-great-demand-years/221256?source=education
Special Robotics (Robot) Feature Article from MIT's Technology
Review ---
Click Here
"How Technology Is Destroying Jobs," by David Rotman, MIT's
Technology Review, June 12, 2013
Note the 60 comments to date
http://www.technologyreview.com/featuredstory/515926/how-technology-is-destroying-jobs/?utm_campaign=newsletters&utm_source=newsletter-daily-all&utm_medium=email&utm_content=20130613
Jensen Comment
This makes me recall a science fiction movie years ago. Handsome people
feeding, frolicking, and "working" at whatever they wanted like painting
landscape pictures above ground for no pay lived very well (sort of like
what Carl Marx viewed as the ultimate communism state). The genetics of
illness, including mental illness, was cured. Everything was wonderful
except for the unlucky few now and then that were hauled off to
slaughter houses to feed the ugly trolls living in dark caverns below
ground, trolls that really controlled the world.
"20 Things We Wish Someone Had Told Us At Graduation," by
Aimee Groth and Max Nisen, Business Insider, May 25, 2013 ---
http://www.businessinsider.com/business-insider-advice-for-college-grads-2013-5
Jensen Comment
Firstly, all 20 things are commonly mentioned in graduation speeches.
Secondly, this advice is coming mostly from people who have attained
some measure of success. These journalists did not report advice from
homeless people, graduates still having minimum wage McJobs, and
graduates still living with their parents because of lack of success in
finding employment.
Thirdly, for every graduate who bypassed the job market and
successfully started out as an entrepreneur there are perhaps a thousand
who are homeless or still living with mom and dad.
Fourthly, advice should be given about commonly-available jobs that
become extremely tedious and boring over a 50-year career. For example,
50 years from now do you still want to be cleaning teeth as a dental
hygienist? Or do you really want to fix teeth for 50 years as a dentist.
Lastly, these journalists did not interview those graduates who were
sexually assaulted while spending a year in a developing country that
should be visited cautiously with common sense. Sadly, the same can be
said for enlisting in the USA military, and you don't have to leave the
USA to be sexually assaulted.
Closing Comment
In elementary school teachers commonly ask students to stand up and
explain what their parents do for a living. If young kids at that age
can explain what their parents do for a living they probably should be
advised to seek other career tracks when they eventually graduates. Most
of the really exciting careers are not easily explained by a seven year
old kid.
Demand for Accounting Graduates Among the Highest of All Disciplines
"CPAs are sexy: Accountants in demand as regulatory climate
tightens," Boston Business Journal, January 14, 2013 ---
http://www.masslive.com/business-news/index.ssf/2013/01/cpas_are_sexy_accountants_in_demand_as_r.html
The numbers are in, and accountants should
be smiling.
The unemployment rate for accountants
stands at just 4.1 percent. And
Forbes.com
recently listed accountants and auditors at
No. 2 on its list of Top Jobs for 2013, just behind software
developers.
Meanwhile, the Class of 2012 Student Survey
Report, released last year by the
National Association of Colleges & Employers,
found that 68 percent of the most recent
accounting majors received job offers, the highest percentage of any
major.
“The job demand is there, and it’s steady,”
said Barbara Iannoni, academic/career development specialist at the
Massachusetts Society of Certified Public Accountants Inc.
In fact, demand for accounting
professionals has picked up and continues to strengthen, said Bill
Driscoll, the New England District president for staffing firm
Robert Half International. And Driscoll says the demand for new
talent is coming from all areas.
“It’s private industry, it’s public, it’s
really across the board. You don’t have to be in a CPA to be in
demand,” he said. “It’s accounting that’s in demand right now. You
can be a comptroller, financial analyst, or auditor without being a
CPA.”
Driscoll said that for applicants with a
mix of public and private company experience — something most CPAs
have — the job opportunities are even more plentiful.
“In the economic environment we still find
ourselves in, anyone in the accounting department who can analyze
where the dollars go, who can help companies stretch every dollar,
are in high demand,” he said.
Nonetheless, companies today still have
high expectations for those they hire; they want accountants who
know more than numbers, Driscoll said.
“Everybody needs number crunchers, but
particularly with the events of the last four or five years, if you
can blend communication skills and leadership skills with accounting
skills or a CPA, that will open up all sorts of opportunities and
career progressions for you,” he said.
Industry leaders said most college students
on the accounting track still aim to get a CPA designation, which
requires meeting state-set academic and experience requirements as
well as passing a one-time state-administered CPA test. Once
certified, a CPA also must meet regular licensing requirements.
It’s no easy process. According to Scott
Moore, senior manager of the College and University Initiatives at
the
American Institute of CPAs,
only 40
percent of test takers nationwide actually pass.
“It shows a lot of dedication and
self-discipline to pass the exam. That really tells you something
about the person,” Moore said.
That’s one of the reasons the CPA remains
such a hot commodity in the job market, he said.
Another reason: the ever-expanding list of
regulations that companies face. It’s a state of affairs that took a
big leap forward in 2002 with the passage of the Sarbanes-Oxley Act.
The Dodd-Frank financial reform act of 2010, which is still being
phased in through dozens of yet-to-be-written regulations, has only
made CPAs all the more valuable, Moore said.
“The work that a CPA does has evolved.
There’s not so much a need to do hard core number crunching because
(computers) can do that, so it’s more interpretation versus creation
of information, and that interpretation is more important to the
business. CPAs have really taken on that role,” said Moore, noting
that CPAs are increasingly filling a number of C-level positions at
major companies.
Continued in article
Jensen Comment
There are some caveats. Undergraduate accounting majors must now take a
fifth year or more (most enter masters degree programs) in order to sit
for the Uniform National CPA Examination. And starting salaries are
lower than salaries of engineers.
And most graduates going to work for CPA firms have a low probability
of surviving in those firms after 5-10 years. But this is not usually
too bothersome since the main reason many accounting graduates first
enter public accounting is for the great training and client exposures.
Most of them did not want to stay in public accounting because of the
requisite travel, long hours, and performance pressures. Those that
leave public accounting after a few years go with clients who offer 9-5
hours, less travel, and much less pressure. And many leave to become
full-time parents between the early parts and late parts of their
accounting careers.
The bummer is that corporations fail offer nearly as many entry-level
jobs as public accounting firms. Corporations and agencies like the FBI
prefer to hire job applicants with some years of accounting experience.
Aside from public accounting, the IRS is one of the best sources of
entry-level job applications. And both the training and experience in
the IRS are excellent for changing jobs later on.
National Association of Colleges and Employers (NACE) ---
http://www.naceweb.org/home.aspx
"2011 Accounting Graduates Earning Average Salaries of $50,000,"
AccountingWeb, January 31, 2012 ---
http://www.accountingweb.com/topic/education-careers/2011-accounting-graduates-earning-average-salaries-50000
Accounting major college graduates earned
an average of $50,500. Entry-level accounting and finance jobs tend
to see steady growth. Highest-paying employers of accounting majors
were securities, commodities, and financial investments employers.
Continued in article
NACE Salary Calculator Center ---
http://www.jobsearchintelligence.com/NACE/salary-calculator-intro/
Jensen Comment
I always warned students to look more at career potential than starting
salaries. For example, a student's lowest starting salary from a public
accountancy firm may be that student's best offer in terms of career
training, experience with quality clients, working atmosphere, travel
requirements, work-at-home opportunities, promotion prospects, etc. Some
firms are better than others in terms of chances of being admitted into
the partnership. Some firms are better than others in terms of working
with clients that offer job change opportunities.
For example, the highest starting salaries for accounting, finance,
and economics graduates are usually Wall Street securities, commodities,
banking, and investments employers. But these are usually accompanied by
high costs of living and possibly time consuming commutes. Compensation
may depend heavily on commissions and bonuses. And a given starting
employee may be only one of hundreds of new hires competing for
recognition and promotion. Accepting a lower salary in a Big Four
auditing firm or even a smaller auditing firm in Des Moines may actually
be a better career choice even if the starting salary is less than
$60,000.
Business School Rankings
Hi Wes,
Thank you for this since it was a ranking I had not seen ---
http://www.businessinsider.com/the-worlds-best-business-schools-2012-6#
I do track rankings of other media outlets like US News,
Bloomberg Business Week, the WSJ, Forbes, and The Economist ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#BusinessSchoolRankings
This has to be the best one since Stanford comes out on top.
Just kidding of course.
It is the a helpful site in the sense that for each of the 50 ranked
programs it shows the ranks that were also given by US News,
Bloomberg Business Week, Forbes, and The Economist.
Feel free to send me some new pictures. I maintain a file on your
professional photographs.
Thanks,
Bob
Bob Jensen's threads about ranking controversies ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#BusinessSchoolRankings
"What To Consider Before," by Bastiaan Janmaat, Fastco Labs,
August 2013 ---
http://www.fastcolabs.com/3014564/open-company/what-to-consider-before-starting-up-in-college
Some of today’s greatest tech companies,
young and old, were started by college students: Microsoft, Dell,
Facebook, Snapchat. In each case, their founders (Gates, Dell,
Zuckerberg, and Spiegel) started working on their companies while in
school, and then dropped out to pursue their ventures full-time. So
is school a good place to start a business?
The advent of cheap hosting and other
outsourced infrastructure has brought the costs of starting a
software company down dramatically. Now more than ever, students are
building companies from their dorm rooms. This was especially
salient for my cofounders and me at Stanford, where, in the last 18
months, we experienced much of the optimism and many of the
resources that the
university has become well-known for.
Here
are other things that student founders have going for them.
“How do I find a cofounder?” is the single
most common question asked of Paul Graham, and yet the hardest
question for him to answer. PG’s answer is that he can’t find you
your cofounder,
because
the best candidates are folks you already know.
My cofounders, Mike and Alden, entered my life
at Stanford. I met Mike through our shared interest in organizing
founder meetups
around campus. Mike and Alden met through Stanford’s CS classes.
It’s cliche but in my opinion very true: Cofounders need to be
respected and trusted peers first, and colleagues second. College is
a fantastic mixing ground because it’s a place where people have
natural flexibility, shared interest, and an objective of getting to
know each other.
Starting a company while at Stanford, we
were able to iterate our concept quickly in classes designed to
“test the entrepreneurial waters.” In the d.school’s “Launchpad,”
we were asked to create a working prototype in
one week, have a paying customer after two, and constantly iterate
our product according to user feedback. Over at the Graduate School
of Business, Professors Barnett and Rachleff taught us how to find
“product-market
fit.” In both cases, the school
environment helped stimulate us to think about our ideas in ways
that are hard to reproduce outside of school. Outside of Stanford,
many startups now adopt the “Lean Startup” Methodology championed by
Eric Ries and taught at many forward-thinking universities around
the world.
Mike, Alden, and I focused many class
projects and presentations on our own startup, garnering help and
feedback from smart classmates while enabling us to refine our
business plan and pitch in a low-risk environment. In school you can
pick up a project, work on it with a group of people, talk to
potential customers, fail, and do it all over again, without the
risks that would come later in life; having to leave your job to try
something new, supporting a big family, etc.
People will almost always extend a helping
hand to students--even when they might not have helped that person
outside the context of school. It’s much easier to learn from and
get to know future partners, colleagues, or competitors while you’re
still in school and they feel an intrinsic desire to help you.
So with all those benefits and resources,
shouldn’t every entrepreneurially minded student be starting a
business in school? Notwithstanding all the benefits of starting a
company in school, there are challenges and risks that I came across
the hard way when founding
LifeSwap (the
predecessor to my current startup--here’s
our pivot story). Consider these
disadvantages:
Some of the startups founded in school
arise through class projects where a group of students proactively
seek to uncover and develop a business opportunity. This goes
against the belief that true innovation stems from authentic and
unique insight into a problem. When students come up with business
ideas that are inauthentic to their own experience, or lack deep
insight into a pain point, there’s a risk that the idea is more of
a
vitamin than a painkiller,
and thus less
likely to be a necessary solution.
Less-than-great ideas, rather than dying
quickly, stay alive due to falsely positive feedback from others.
Affirmative feedback from surveying classmates is too often taken as
confirmation of a use case, when it is a result of people’s
inclination to be supportive. We learned this lesson with LifeSwap:
People loved the idea of experiencing another job for a few hours!
But our classmates weren’t our target market... so make sure you get
“out
of the building” to test your product with
your real customers.
Amidst that echo chamber of excitement
about your startup, and positive reactions from those around you,
many student founders experience an escalation of commitment. Before
I knew it, I was working on LifeSwap in lieu of a summer internship,
and being asked if I was planning to “drop out” before graduation. I
considered it, as did a number of classmates of mine. With
hindsight, I’m relieved that I decided to stay in school. My chances
to start a business didn’t dissipate, while the experience of
attending graduate school and building a valuable network would have
been hard to replicate later on. One question to ask is whether
deferral is an option.
Continued in article
"Are languages important for accountants?" by Mark P. Holtzman,
Accountinator Blog, February 21, 2013 ---
http://accountinator.com/2013/02/21/1151/
Jensen Comment
Increasingly in this global world I've been an advocate of language
skills in general and for accounting graduates in particular. Years ago
I had a student at Trinity University who had a minor in Russian. My
personal opinion is that he probably would not have become a Big Four
partner in the Houston Office. However, when he was transferred to the
Moscow office of that Big Four firm he made partner in record time.
Accounting and auditing firms in Texas have enormous opportunities
for client work in Mexico and most points south where Spanish is
generally the native tongue. I had another student who I never predicted
would get a job with a Big Four firm because I always thought of him
more as a baseball star than a good student in accounting. However,
Trinity University is a special university for language skills. This
baseball player landed a job in the San Antonio office of the Big Four.
Furthermore he was single and more than willing to take on very long
engagements with clients south of the Rio Grande. This student also had
a very engaging personality --- one of the funniest guys I ever met. He
probably should've followed in the footsteps of an accountant named Bob
Newhart ---
http://en.wikipedia.org/wiki/Bob_Newhart
Trinity University has a relatively popular Chinese language program
and quite a few of my former students found it to their advantage to
minor in Chinese.
The 3 Secrets Of Highly Successful Graduates (Slide Show)
"Amazing Career Advice For College Grads From LinkedIn's Billionaire
Founder," by Nicholas Carlson, Business Insider, May 12, 2013 ---
http://www.businessinsider.com/amazing-career-advice-for-college-grads-from-linkedins-billionaire-founder-2013-5
Jensen Comment
I'm not sure I agree with all of this. If you search long enough and
hard enough almost everything appears somewhere in the library and/or in
Web documents. The problem is sorting out the wheat from the chaff
beforehand in the context of your particular talent, skills,
determination, family circumstances, living environment, health,
opportunities, and constraints.
Millionaires and billionaires, like Reid Hoffman, often feel they
have the answers to success when in fact much of their success is a
matter of luck along the serendipitous road in life. I grant them the
fact that sometimes you help to make your own luck, but by it's very
definition taking "risks" with careers means that there will be many
losers as long as a few winners along that serendipitous road.
Also most people really do not have the talent for and drive to
becoming successful entrepreneurs. Advising most graduates to become
entrepreneurs may be setting them on a road to failure.
To illustrate my point, I think that many accounting graduates are
better off to become lifelong employees as public accountants, internal
auditors, governmental accountants, FBI agents, etc. Most of them are
likely to fall on very hard times if they quit their jobs and leverage
up to create a startup company.
Hopefully, some of them will take the plunge and form a new venture
in a quest for the American Dream. But this is not good advice for the
majority of those graduates looking down the road at their lifelong
careers. Tell most of those graduates that they may find great careers
as public accountants, internal auditors, governmental accountants, FBI
agents, professors, etc. At the same time tell them to keep their
eyes open to opportunities and to be willing, if they have the
inspiration to do so, to take the plunge. But also tell them not to
become victims of get-rich-quick frauds.
Going Concern's Admittedly Unscientific 2012 Survey of Starting
Salaries for New Accounting Graduates ---
http://goingconcern.com/post/recruiting-season-public-accounting-salaries-starting-class-2013
Jensen Comment
Keep in mind that cost of living varies.
When I was still teaching it was somewhat easier to get a Big Four
starting job in San Francisco relative to San Antonio. In San Francisco
the salary would hardly pay for a one-room apartment without partnering
to share the rent. Starting salaries are often not fully adjusted for
higher cost-of-living cities.
Also I will mention my oft-repeated advice to college graduates. The
amount of starting salary should be a low priority relative to
prospective employer training, exposure to clients who are often the way
career tracks head after a year or two with a CPA firm, opportunities in
areas of interest such as tax or IT, and opportunities for international
transfer (e.g., to Asia), and expected travel requirements (tough for
expecting parents), and opportunity for work at home (great for
expecting parents).
CPA firms do not offer high enough salaries for entry-level auditing
and tax to attract graduates from prestigious MBA programs. These firms
do not hire many such MBA graduates and when they do hire these
graduates at higher salaries it is generally for consulting rather than
auditing and tax. CPA firms generally want consultants who have
considerable on-the-job training and special skills such as IT and
language skills.
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
"For Newly Minted M.B.A.s, a Smaller Paycheck Awaits," by Ruth
Simon, The Wall Street Journal, January 6, 2013 ---
http://professional.wsj.com/article/SB10001424127887324296604578175764143141622.html?mg=reno64-wsj
Like many students, Steve Vonderweidt hoped
that a master's degree in business administration would open doors
to a new job with a higher paycheck.
But now, about eight months after receiving
his M.B.A. from the University of Louisville, Mr. Vonderweidt, 36
years old, hasn't been able to find a job in the private sector, and
continues to work as an administrator at a social-service agency
that helps Louisville residents obtain food stamps, health care and
other assistance. He is saddled with about $75,000 in student-loan
debt—much of it from graduate school.
"It was a really great program," says Mr.
Vonderweidt. "But the job part has been atrocious."
Soaring tuition costs, a weak labor market
and a glut of recent graduates such as Mr. Vonderweidt are upending
the notion that professional degrees like M.B.A.s are a sure ticket
to financial success.
The M.B.A.'s lot is partly reflected in
starting pay. While available figures vary by schools and employers,
recruiters' expected median salary for newly hired M.B.A.s was
essentially flat between 2008 and 2011, not adjusting for inflation,
according to a survey by the Graduate Management Admission Council.
For graduates with minimal experience—three
years or less—median pay was $53,900 in 2012, down 4.6% from
2007-08, according to an analysis conducted for The Wall Street
Journal by PayScale.com. Pay fell at 62% of the 186 schools
examined.
Even for more seasoned grads the trend is
similar, says Katie Bardaro, lead economist for PayScale.com. "In
general, it seems that M.B.A. pay is either stagnant or falling,"
she says.
The pressures are greatest for those
attending less prestigious schools, says Stanford Business School
professor Paul Oyer, who studies personnel trends. But even at top
programs, some graduates are likely to struggle in today's
environment, he says.
Another burdensome issue: a high debt load.
Nearly 60% of graduating M.B.A.s said they expected to repay some
loans after graduation, according to a 2012 GMAC survey. Among
households headed by people with student debt who attended graduate
school and are under 35, average student loan debt climbed to
$81,758 in 2010 according a Wall Street Journal analysis of Federal
Reserve data. That figure is up from $55,594 in 2007.
It is all a far cry from the late 1980s and
early 1990s heyday for M.B.A.s, when some companies would hire 100
or more M.B.A.s. It wasn't uncommon to recruit first, and fill
actual jobs later.
"Some of those companies would hire today
barely in the single-digits," says Mark Peterson, president of the
M.B.A. Career Services Council.
A weak economic climate is only partly to
blame for the M.B.A.'s plight. The changing nature of B-school
programs, evolving corporate needs—as well as the perceived value of
the degree—have all helped dilute the M.B.A.'s allure.
Formerly, the traditional M.B.A. was mainly
the product of a full-time, two-year program. But beginning in the
early 1990s, many schools created part-time and executive M.B.A.
programs, with lower-ranked schools often following in the footsteps
of academic leaders. Online degrees also gained in popularity.
As a result, the number of M.B.A. degrees
granted has grown faster than the population, says Brooks Holtom, a
management professor at Georgetown University's McDonough School of
Business.
"An M.B.A. is a club that is now not
exclusive," he says. "You should not assume that this less exclusive
club is going to confer the same benefits."
Today's global corporate culture amplifies
the competition. "We are trying to internationalize our business
like everyone else," says Lee Ashton, director of international
human resources at spirits maker Brown-Forman Corp. BF.B +0.37% With
58% of its business outside the U.S., the Louisville company has
stepped up recruiting of M.B.A.s from abroad.
U.S. schools granted a record 126,214
masters degrees in business and administration in the 2010-2011
academic year, a 74% jump from 2000-2001, according to the
Department of Education. The M.B.A. march is part of an overall boom
in advanced degrees that took on added steam as some recent college
graduates and others sought refuge from the recession by pursuing
advanced degrees. Tuition and fees for full-time M.B.A. programs has
risen 24% over the past three years, according to the main body that
accredits U.S. business schools.
It is unclear how many M.B.A.s the market
really needs. Recently, more companies have indicated that "they are
moving away from an emphasis on M.B.A.s" and are instead hiring more
undergraduates at lower salaries that they can then train in-house,
says Camille Kelly, vice president of employer branding at Universum,
a firm that advises companies on how to attract and retain the best
employees. Companies, she says, "still will do M.B.A. hiring, but it
won't be to the same extent they have in the past."
Continued in article
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Texas: Bar Exam Passage Rates by University ---
http://www.ble.state.tx.us/stats/stats_0212.htm
Thank you for the heads up Dennis Elam
Bob Jensen's threads on Turkey Times for Overstuffed Law Schools
---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#OverstuffedLawSchools
Baylor Law School ---
http://www.baylor.edu/law/
The Baylor Law Data Dump
Baylor University School of Law Reveals Each Student's Grade Average,
LSAT Score, Alma Mater, Race, Ethnicity, and Scholarship Amount
Law School Admission Test (LSAT) ---
http://en.wikipedia.org/wiki/LSAT
Scoring
The LSAT is a
standardized test in that LSAC adjusts raw scores to fit an
expected norm to overcome the likelihood that some administrations
may be more difficult than others.
Normalized scores are distributed on a
scale with a low of 120 to a high of 180.
The LSAT system of scoring is predetermined and does not reflect
test takers' percentile, unlike the SAT. The relationship between
raw questions answered correctly (the "raw score") and scaled score
is determined before the test is administered, through a process
called
equating. This means that the conversion standard is set
beforehand, and the distribution of
percentiles can vary during the scoring of any particular LSAT.
Adjusted scores resemble a
bell curve, tapering off at the extremes and concentrating near
the median. For example, there might be a 3-5 question difference
between a score of 175 and a score of 180, but the difference
between a 155 from a 160 could be 9 or more questions. Although the
exact percentile of a given score will vary slightly between
examinations, there tends to be little variance. The 50th percentile
is typically a score of about 151; the 90th percentile is around 163
and the 99th is about 172. A 178 or better usually places the
examinee in the 99.9th percentile.
Examinees have the option of canceling their scores within six
calendar days after the exam, before they get their scores. LSAC
still reports to law schools that the student registered for and
took the exam, but releases no score. There is a formal appeals
process for examinee complaints,[16]
which has been used for proctor misconduct, peer misconduct, and
occasionally for challenging a question. In very rare instances,
specific questions have been omitted from final scoring.
University of North Texas economist Michael Nieswiadomy has
conducted several studies (in 1998, 2006, and 2008) derived from
LSAC data. In the most recent study Nieswiadomy took the LSAC's
categorization of test-takers into 162 majors and grouped these into
29 categories, finding the averages of each major:[17]
-
Mathematics/Physics
160.0
- Economics and
Philosophy/Theology
(tie) 157.4
-
International relations 156.5
-
Engineering 156.2
-
Government/service 156.1
- Chemistry 156.1
- History 155.9
-
Interdisciplinary studies 155.5
-
Foreign languages 155.3
-
English 155.2
- Biology/natural
sciences 154.8
-
Arts 154.2
-
Computer science 154.0
- Finance 153.4
-
Political science 153.1
-
Psychology 152.5
-
Liberal arts 152.4
-
Anthropology/geography
152.2
-
Accounting 151.7
-
Journalism 151.5
- Sociology/social
work 151.2
- Marketing 150.8
-
Business management 149.7
- Education 149.4
-
Business administration 149.1
-
Health professions 148.4
- Pre-law 148.3
-
Criminal justice 146.0
The Baylor Law Data Dump ---
http://abovethelaw.com/2012/04/the-baylor-law-data-dump-now-with-race-and-scholarships/2/
If you're interested in this data it may be best to download it now. I
don't expect this to remain on the Web for long.
"The Law School System Is Broken,"
National Jurist, February 2012 ---
Click Here
http://www.nxtbook.com/splash/nationaljurist/nationaljurist.php?nxturl=http%3A%2F%2Fwww.nxtbook.com%2Fnxtbooks%2Fcypress%2Fnationaljurist0212%2Findex.php#/18/OnePage
Thank you Paul Caron for the heads up
Turkey Times for Overstuffed Law Schools ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#OverstuffedLawSchools
At the University of Texas MBA women graduates edged out men in terms
of compensation offers
At the University of Michigan female and male MBA graduates average
about the same compensation offers
Why are women MBA graduates from Stanford not faring as well as their
male counterparts?
"Why Stanford MBA Men Make So Much More Than Women?" by Alison
Damast, Bloomberg Business Week, December 21, 2012 ---
http://www.businessweek.com/articles/2012-12-21/why-stanford-mba-men-make-so-much-more-than-women
The gender pay gap at Stanford’s
Graduate School of Business
has female
graduates earning 79¢ on the male dollar, the widest discrepancy in
earnings between men and women at any of the top 30 business
schools, according to
new research from
Bloomberg
Businessweek.
That disparity may seem large, but it isn’t
startling to many of the women in the Stanford Class of 2012, who
say the figures largely indicate the wide range of career choices
they are making.
Take Shan Riku, who worked as a consultant
at McKinsey before business school and is now working as head of new
business development at Cookpad, Japan’s largest recipe-sharing
website. Riku admits she took a pay cut in accepting the position
but says she was more interested in taking on a role that would
challenge her. It also didn’t hurt that Cookpad encourages families
to cook and spend time together. “Many women at Stanford tend to
make choices that are a little bit more focused on ‘how do I want to
balance my life,’ rather than ‘how can I earn a lot of money,’” she
says.
Pulin Sanghvi, director of the career
management center at Stanford’s business school, says most of the
pay gap at his school can be “attributed to industry choice.”
According to Sanghvi, women and men at Stanford who go into the
consulting or Internet technology sectors tend to have average
starting salaries that are close or equivalent in size. Those 2012
MBA graduates who headed into the consulting field received a mean
base salary of $130,636, while others who went into the technology
sector earned $118,050, according to the business school’s most
recent employment report.
The wage gap comes about partly because
fewer women are heading into some of the more lucrative finance
fields. For example, 16 percent of male students took jobs in
private equity and leveraged-buyout firms, compared with just 5
percent of women, Sanghvi says. The top four industries that
Stanford women went into in 2012 were information technology,
management consulting, consumer products, and venture capital.
“I think a part of the story of this
generation of students is that they have a much larger playing field
in terms of career choices,” Sanghvi says. “I don’t think the level
of income in a job is necessarily the primary motivator for why
someone makes an empowered choice to pursue a career.”
That’s not to say that women at the school
aren’t thinking long and hard about their salary offers and how to
best negotiate them.
Continued in article
Jensen Comment
This says very little about graduates wanting to become CPAs since
Stanford does not offer a career track for taking the CPA examination.
The few graduates who do seek to become auditors or tax accountants most
likely were CPAs before entering Stanford's MBA program. After
graduating they most likely will no longer seek to work for CPA firms as
auditors and tax accountants.
Bob Jensen's threads on the gender pay gap in academe ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#GenderSalaryDifferences
"For Aspiring Forensic Accountants and Fraud Investigators,"
by Tracey Coenen, The Fraud Files Blog, March 24, 2013 ---
http://www.sequenceinc.com/fraudfiles/2013/03/for-aspiring-forensic-accountants-and-fraud-investigators/
Bob Jensen's threads on forensic accounting are at
http://faculty.trinity.edu/rjensen/Fraud001c.htm#Forensic
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
"MBA Gender Pay Gap: An Industry Breakdown," by: Alison Damast,
Bloomberg Business Week, January 7, 2013 ---
http://www.businessweek.com/articles/2013-01-07/mba-gender-pay-gap-an-industry-breakdown
Ross School (University of Michigan) Nearly Erases MBA Gender Pay Gap
-(for graduates) ---
http://www.businessweek.com/articles/2012-12-14/ross-school-nearly-erases-mba-gender-pay-gap
At the University of Texas women MBAs beat out the men ---
http://www.businessweek.com/articles/2012-12-12/mccombs-women-beat-mba-gender-salary-gap
Jensen Comment
This does not mean that there were no differences between majors. For example,
women finance graduates earned about $6,500 less than men majoring in finance,
but they may have been paid more than women in management and marketing.
I do not know that this is the case, but as in the case of comparing inequality
between nations, it's important to note that the degree of equality is not
nearly as important as the level of poverty. For example, the Gini Coefficients
of equality are about the same for Canada and North Korea, but the absolute
differences in poverty are immense.
Accounting firms probably do not hire many MBA graduates from Michigan since
Michigan has a separate Masters of Accounting Program ---
http://www.bus.umich.edu/Admissions/Macc/Whyross.htm
It would surprise me if there were any gender differences in salary offers in
this MAC program, although there may be some racial differences where top
minority graduates have higher offers than whites.
The one question about all this that I would raise is job location. At
Trinity University when I was still teaching we sometimes placed a single
graduate from our very small MS in Accounting graduating class at a higher
salary in San Francisco or some other city having very high living costs.
The ANOVA statistician in me questions gender comparisons across geographic
cells having greatly varying living costs. For example the MBA woman landing a
consulting job for $140,000 in San Francisco or Geneva really cannot compare her
salary with the woman who gets $140,000 in Detroit. In Detroit some relatively
nice houses are being given away free to people who will occupy them full time.
The exact same house in San Francisco might sell for $845,000. So much for
declaring that both women are being paid the same.
It's also difficult to compare salary offers that are variable. For example,
it's common to offer base salary plus commissions for majors in marketing and
finance for stock brokers and other sales jobs.
In the 1990s it would've also been difficult to compare some salary offers
for graduates in finance and computer science. For example, I know about a
Stanford Computer Science graduate who was paid minimum wage plus $1 million in
stock options. I think this type of hiring declined when the 1990s technology
bubble burst and FAS 126R went into effect. FAS 123R pretty much killed stock
option compensation.
Bob Jensen's threads on gender salary differences ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#GenderSalaryDifferences
At the University of Texas MBA women graduates edged out men in terms of
compensation offers
At the University of Michigan female and male MBA graduates average about the
same compensation offers
Why are women MBA graduates from Stanford not faring as well as their male
counterparts?
"Why Stanford MBA Men Make So Much More Than Women?" by Alison Damast,
Bloomberg Business Week, December 21, 2012 ---
http://www.businessweek.com/articles/2012-12-21/why-stanford-mba-men-make-so-much-more-than-women
The gender pay gap at Stanford’s
Graduate School of Business
has female graduates
earning 79¢ on the male dollar, the widest discrepancy in earnings between
men and women at any of the top 30 business schools, according to
new research from
Bloomberg Businessweek.
That disparity may seem large, but it isn’t
startling to many of the women in the Stanford Class of 2012, who say the
figures largely indicate the wide range of career choices they are making.
Take Shan Riku, who worked as a consultant at
McKinsey before business school and is now working as head of new business
development at Cookpad, Japan’s largest recipe-sharing website. Riku admits
she took a pay cut in accepting the position but says she was more
interested in taking on a role that would challenge her. It also didn’t hurt
that Cookpad encourages families to cook and spend time together. “Many
women at Stanford tend to make choices that are a little bit more focused on
‘how do I want to balance my life,’ rather than ‘how can I earn a lot of
money,’” she says.
Pulin Sanghvi, director of the career management
center at Stanford’s business school, says most of the pay gap at his school
can be “attributed to industry choice.” According to Sanghvi, women and men
at Stanford who go into the consulting or Internet technology sectors tend
to have average starting salaries that are close or equivalent in size.
Those 2012 MBA graduates who headed into the consulting field received a
mean base salary of $130,636, while others who went into the technology
sector earned $118,050, according to the business school’s most
recent employment report.
The wage gap comes about partly because fewer women
are heading into some of the more lucrative finance fields. For example, 16
percent of male students took jobs in private equity and leveraged-buyout
firms, compared with just 5 percent of women, Sanghvi says. The top four
industries that Stanford women went into in 2012 were information
technology, management consulting, consumer products, and venture capital.
“I think a part of the story of this generation of
students is that they have a much larger playing field in terms of career
choices,” Sanghvi says. “I don’t think the level of income in a job is
necessarily the primary motivator for why someone makes an empowered choice
to pursue a career.”
That’s not to say that women at the school aren’t
thinking long and hard about their salary offers and how to best negotiate
them.
Continued in article
Jensen Comment
This says very little about graduates wanting to become CPAs since Stanford does
not offer a career track for taking the CPA examination. The few graduates who
do seek to become auditors or tax accountants most likely were CPAs before
entering Stanford's MBA program. After graduating they most likely will no
longer seek to work for CPA firms as auditors and tax accountants.
Bob Jensen's threads on the gender pay gap in academe ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#GenderSalaryDifferences
Dumber Lawyers
"Another Drop in LSAT Test-Takers," Inside Higher Ed, November
20, 2012 ---
http://www.insidehighered.com/quicktakes/2012/11/20/another-drop-lsat-test-takers
"Not a New Problem: How the State of the Legal Profession Has Been
Secretly in Decline for Quite Some Time," by Marc Gans, SSRN, June
24, 2012 ---
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2173144
My goal was to provide an
in-depth analysis of the job market for new law graduates over
time, as well as the state of the legal field as a whole. Using
historical records, I reached the following results:
- Depending on which dataset is
used, of the 1.4 million law graduates of the last 40-years,
200,000-600,000 are not working as attorneys.
- Using NALP data, I calculate a
True Employment Percentage (full-time, JD-required jobs
excluding those who start their own practice) and find that
it has been bad for a long time, not just recently. Over the
last 25 years this percentage has averaged 68%, meaning 1
out of every 3 graduates couldn't find legal work. I also
use regression to show that it is not correlated with bar
passage rates.
- Using this True Employment
Percentage, I found that the ABA should have stopped
accrediting law schools in the mid-1970's.
- The ABA dataset shows that
overall, these "newer" law schools have worse employment
outcomes, especially for the most desirable jobs. For
example, 16% of graduates of schools accredited before 1975
found employment in firms of 100 attorneys, while under 4%
of graduates of schools accredited after this time did.
- Income inequality for starting
salaries has been widening dramatically. Over the last 16
years, the 75th percentile real starting salary has
increased 73%, while the 25th percentile real starting
salary has increased just 11% (almost all of it occurring
before 2000).
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
"Where the Fortune 500 CEOs Went to School: These schools
awarded at least 10 college and graduate degrees to America’s leading
executives," by Menachem Wecker, US News, May 14, 2012 ---
http://www.usnews.com/education/best-graduate-schools/top-business-schools/articles/2012/05/14/where-the-fortune-500-ceos-went-to-school
Jensen Comment
For years I've preached that students seek prestigious universities for
much more than book learning. The top universities provide networking
opportunities and alumni relations that probably exceed most anything
students learn from the books. Of course, networking experiences are
highly variable.
But there also is a well-known problem of correlation versus
causation going on here. There may be underlying causal factors such as
the attributes of students who gain admission to prestigious schools
that a subset of those students may rise to the top irrespective of
where they graduate.
If you annually track the backgrounds of CPAs admitted into the Big
Four partnerships in the United States you will be surprised the
proportion that graduated as accounting majors for Podunk College. Cream
rising to the top is a fundamental attribute of molecular chemistry.
But we cannot deny the fact that a degree from a prestigious
university is a key that unlocks doors. This is especially the case when
it comes to PhD graduates seeking tenure track positions. A Podunk
College PhD generally does not stack up well with a doctorate from
Harvard, Stanford, and Penn. There are exceptions of course, but these
are rare in the Academy.
Jensen Comment
If there ever was BS about a BS this has to be the site ---
http://www.collegemeasures.org/
One thing I always warned my students about is that education is much
more than a ticket to a job. Education is part and parcel to almost
everything in life.
And when looking at career alternatives, I always warned my students
to pretty much ignore starting salaries when choosing a career or
choosing from first-time job alternatives. Reasons are as follows:
- Some companies will offer higher starting salaries because
they're weak in other attractions such as training, exposure to
quality clients, job security, travel requirements, benefits, etc.
In public accountancy, for example, the most important things are
training and exposure to quality clients who frequently offer jobs
to selected members of audit teams that conduct onsite audits or
consulting for these clients.
- Local, state, and federal government job offers often look low
relative to job offers from the private sector. But there are often
many advantages to starting out with government such as starting out
with the IRS. Government sometimes offers great training
opportunities. Secondly, government may offer "client" exposures
that provide similar opportunities for career advancement in the
private sector following that first-job in government. Some of our
best accounting firm tax experts are former IRS agents, and some of
our best tax professors were former IRS agents. The name Amy Dunbar
at the University of Connecticut rings a bell here.
- Large firms may offer the highest starting salaries, but the
career opportunities may be greater in small firms. For example, the
probability that an accounting graduate who starts out in a Big Four
accounting firm will ultimately make partner varies among the
hundreds of offices around the world, but the overall probability is
much less than 20%. In fairness, most graduates want Big Four
training and client exposure opportunities without ever intending to
stick around long enough to become partners. Other accounting
graduates would prefer to start out with smaller accounting firms or
companies where they can start out as larger fish in small ponds
with much greater opportunity to become partners or senior managers
or executives.
- Relative to salary at any point in a career, also think about
mobility. It is quite common for employees to change jobs for a
number of reasons, including termination (e.g., no tenure or
promotion), unhappiness in a particular job, transfer of a spouse,
desire to get out of a city, desire to get into a city, etc. Some
careers have greater mobility upon relocation. And high-mobility
careers may not have the highest starting salaries. For example, my
UPS driver up here in the mountains has a BS in finance. He could've
had a higher starting salary when he graduated in Boston, but when
he moved to these mountains he could not find any job in finance. If
he had instead been a nurse, he could've found a nursing job
immediately.
- Think of the lifestyle aspects of a career that become much more
important later in life than salary. For example, many first-year
premed majors change majors after their science teachers fully
explain the lifestyle advantages and disadvantages of being a
lifetime medical doctor. For example, if every day is the same old
thing of reading radiology film, fixing herniated discs, putting in
lens implants, or replacing knees and hips, life can be pretty
boring over the next 40 years. Students should consider the many
aspects of a career other than expected earnings. And there are many
aspects to consider. Physicians generally get rewards of improving
or restoring the lives of their patients. But many also take on
heavy pressures of possibly ruining the lives of their patients.
- Think of the debt and such things as malpractice insurance. For
example, physicians who start out at relatively high salaries or
billings often spend years of paying off the tens of thousands or
more dollars of debt accumulated in medical school. Getting free of
that debt may take a long time. One of my granddaughters estimates
she will be 50 years old before she makes the last payment on
student loans. Also, consider the costs of a career. The malpractice
insurance of my wife's spine surgeon is over $500,000 per year plus
he has to pay for his own office staff, his own office nurses, his
physician assistants, and even his own accountants and computer
specialists.
Lastly, when reading the charts and tables in the site below consider
the aggregation and other weaknesses of the data. For example,
accounting is mixed in with business studies. But the advantages and
disadvantages of an accounting career are much, much different than
those of marketing, management, finance, and other types of business
careers. For example, I looked up the PhD starting salary for a
"business" major in one major university. It was stated as $90,000.
However, accounting PhD graduates at that particular university are more
apt to be $150,000 or more. Plus there are summer stipends that add up
to 20% more to starting salaries.
And while we're at it, consider the starting salary of an accounting
PhD. The highest salary offer may come from Harvard or Stanford, but the
living costs in Cambridge or Palo Alto are possibly twice as much or
more than the living costs in Ames, Iowa --- perhaps ten times as much
in terms of house purchase and rental prices. And the odds of getting
tenure are low at Harvard or Stanford such that considerations such as
research opportunities should outweigh starting salary considerations.
And now for the BS about a BS ---
http://www.collegemeasures.org/
"All About the Money: What if lawmakers and students used
starting salaries to evaluate colleges and their programs?" by Dan
Berrett, Chronicle of Higher Education, September 18, 2012 ---
http://chronicle.com/article/All-About-the-Money/134422/?cid=at&utm_source=at&utm_medium=en
What is your college degree truly worth?
That is the question that a new report
seeks to answer. And it does so by distilling college into a number,
expressed in dollars.
"The Earning Power of Graduates From
Tennessee's Colleges and Universities" is the latest effort to
precisely quantify the value of a degree. It identifies the payoff
that individual programs at specific colleges yield the first year
after graduation. While limited to Tennessee, it will be followed by
similar analyses in other states, and it marks the arrival of a new
way of evaluating higher education that brings conversations about
college productivity and performance to the program level.
Due out this week, the report—by College
Measures, a partnership of the American Institutes for Research and
Matrix Knowledge, a consulting firm—is bound to spark debate about
what it counts and omits, and to raise fears over how its findings
will be used.
The report has been praised by some
analysts for merging data on education and employment in valuable
ways and for producing revealing insights. For instance, in
Tennessee, attending the flagship, in Knoxville, might not lead to a
higher paycheck for new graduates than completing a
community-college program, depending on the major a student chooses.
The report also exposes simmering arguments
in higher education: whether college is chiefly for personal
economic gain or for serving the public good, whether teaching
potential students about the costs and benefits of their college
choices will further cement an already widespread consumerist ethos,
and whether data on disparate outcomes by discipline will fuel more
attacks on liberal-arts programs, whose graduates may not earn large
salaries right after college but fare better later.
Produced in collaboration with the
Tennessee Higher Education Commission, the report was preceded by a
Web site, which became public last month, with
data
for institutions in Arkansas. College
Measures is also producing analyses for Colorado, Nevada, Texas, and
Virginia.
More states may follow suit. About half the
states have the ability to link postsecondary academic records with
labor data, according to a 2010 report by the State Higher Education
Executive Officers. Few states have done so, says Travis J. Reindl,
a program director for the National Governors Association, but
interest is growing in the types of analyses that College Measures
performs.
"Governors care very much about job
creation, and they care very much about meeting work-force needs.
Both of these things rely on good information," says Mr. Reindl.
"This is an issue that's clearly starting to percolate because it
all goes back to jobs, job, jobs."
Salary
Matters
Previous
studies by the Georgetown University Center on Education and the
Workforce, among others, have analyzed
wage differences by major. The Tennessee report breaks new ground,
says Jeff Strohl, director of research at the Georgetown center, by
marshaling data from disparate state agencies to identify the
average first-year wages of the state's college graduates between
2006 and 2010, and linking those data to the majors they pursued and
institutions they attended.
Continued in article
Jensen Comment
If there ever was BS about a BS or a PhD this has to be the site ---
http://www.collegemeasures.org/
One thing I always warned my students about is that education is much
more than a ticket to a job. Education is part and parcel to almost
everything in life.
And when looking at career alternatives, I always warned my students
to pretty much ignore starting salaries when choosing a career or
choosing from first-time job alternatives. Reasons are as follows:
- Some companies will offer higher starting salaries because
they're weak in other attractions such as training, exposure to
quality clients, job security, travel requirements, benefits, etc.
In public accountancy, for example, the most important things are
training and exposure to quality clients who frequently offer jobs
to selected members of audit teams that conduct onsite audits or
consulting for these clients.
- Local, state, and federal government job offers often look low
relative to job offers from the private sector. But there are often
many advantages to starting out with government such as starting out
with the IRS. Government sometimes offers great training
opportunities. Secondly, government may offer "client" exposures
that provide similar opportunities for career advancement in the
private sector following that first-job in government. Some of our
best accounting firm tax experts are former IRS agents, and some of
our best tax professors were former IRS agents. The name Amy Dunbar
at the University of Connecticut rings a bell here.
- Large firms may offer the highest starting salaries, but the
career opportunities may be greater in small firms. For example, the
probability that an accounting graduate who starts out in a Big Four
accounting firm will ultimately make partner varies among the
hundreds of offices around the world, but the overall probability is
much less than 20%. In fairness, most graduates want Big Four
training and client exposure opportunities without ever intending to
stick around long enough to become partners. Other accounting
graduates would prefer to start out with smaller accounting firms or
companies where they can start out as larger fish in small ponds
with much greater opportunity to become partners or senior managers
or executives.
- Relative to salary at any point in a career, also think about
mobility. It is quite common for employees to change jobs for a
number of reasons, including termination (e.g., no tenure or
promotion), unhappiness in a particular job, transfer of a spouse,
desire to get out of a city, desire to get into a city, etc. Some
careers have greater mobility upon relocation. And high-mobility
careers may not have the highest starting salaries. For example, my
UPS driver up here in the mountains has a BS in finance. He could've
had a higher starting salary when he graduated in Boston, but when
he moved to these mountains he could not find any job in finance. If
he had instead been a nurse, he could've found a nursing job
immediately.
- Think of the lifestyle aspects of a career that become much more
important later in life than salary. For example, many first-year
premed majors change majors after their science teachers fully
explain the lifestyle advantages and disadvantages of being a
lifetime medical doctor. For example, if every day is the same old
thing of reading radiology film, fixing herniated discs, putting in
lens implants, or replacing knees and hips, life can be pretty
boring over the next 40 years. Students should consider the many
aspects of a career other than expected earnings. And there are many
aspects to consider. Physicians generally get rewards of improving
or restoring the lives of their patients. But many also take on
heavy pressures of possibly ruining the lives of their patients.
- Think of the debt and such things as malpractice insurance. For
example, physicians who start out at relatively high salaries or
billings often spend years of paying off the tens of thousands or
more dollars of debt accumulated in medical school. Getting free of
that debt may take a long time. One of my granddaughters estimates
she will be 50 years old before she makes the last payment on
student loans. Also, consider the costs of a career. The malpractice
insurance of my wife's spine surgeon is over $500,000 per year plus
he has to pay for his own office staff, his own office nurses, his
physician assistants, and even his own accountants and computer
specialists.
Lastly, when reading the charts and tables in the site below consider
the aggregation and other weaknesses of the data. For example,
accounting is mixed in with business studies. But the advantages and
disadvantages of an accounting career are much, much different than
those of marketing, management, finance, and other types of business
careers. For example, I looked up the PhD starting salary for a
"business" major in one major university. It was stated as $90,000.
However, accounting PhD graduates at that particular university are more
apt to be $150,000 or more. Plus there are summer stipends that add up
to 20% more to starting salaries.
And while we're at it, consider the starting salary of an accounting
PhD. The highest salary offer may come from Harvard or Stanford, but the
living costs in Cambridge or Palo Alto are possibly twice as much or
more than the living costs in Ames, Iowa --- perhaps ten times as much
in terms of house purchase and rental prices. And the odds of getting
tenure are low at Harvard or Stanford such that considerations such as
research opportunities should outweigh starting salary considerations.
And now for the BS about a BS ---
http://www.collegemeasures.org/
"All About the Money: What if lawmakers and students used
starting salaries to evaluate colleges and their programs?" by Dan
Berrett, Chronicle of Higher Education, September 18, 2012 ---
http://chronicle.com/article/All-About-the-Money/134422/?cid=at&utm_source=at&utm_medium=en
What is your college degree truly worth?
That is the question that a new report
seeks to answer. And it does so by distilling college into a number,
expressed in dollars.
"The Earning Power of Graduates From
Tennessee's Colleges and Universities" is the latest effort to
precisely quantify the value of a degree. It identifies the payoff
that individual programs at specific colleges yield the first year
after graduation. While limited to Tennessee, it will be followed by
similar analyses in other states, and it marks the arrival of a new
way of evaluating higher education that brings conversations about
college productivity and performance to the program level.
Due out this week, the report—by College
Measures, a partnership of the American Institutes for Research and
Matrix Knowledge, a consulting firm—is bound to spark debate about
what it counts and omits, and to raise fears over how its findings
will be used.
The report has been praised by some
analysts for merging data on education and employment in valuable
ways and for producing revealing insights. For instance, in
Tennessee, attending the flagship, in Knoxville, might not lead to a
higher paycheck for new graduates than completing a
community-college program, depending on the major a student chooses.
The report also exposes simmering arguments
in higher education: whether college is chiefly for personal
economic gain or for serving the public good, whether teaching
potential students about the costs and benefits of their college
choices will further cement an already widespread consumerist ethos,
and whether data on disparate outcomes by discipline will fuel more
attacks on liberal-arts programs, whose graduates may not earn large
salaries right after college but fare better later.
Produced in collaboration with the
Tennessee Higher Education Commission, the report was preceded by a
Web site, which became public last month, with
data
for institutions in Arkansas. College
Measures is also producing analyses for Colorado, Nevada, Texas, and
Virginia.
More states may follow suit. About half the
states have the ability to link postsecondary academic records with
labor data, according to a 2010 report by the State Higher Education
Executive Officers. Few states have done so, says Travis J. Reindl,
a program director for the National Governors Association, but
interest is growing in the types of analyses that College Measures
performs.
"Governors care very much about job
creation, and they care very much about meeting work-force needs.
Both of these things rely on good information," says Mr. Reindl.
"This is an issue that's clearly starting to percolate because it
all goes back to jobs, job, jobs."
Salary
Matters
Previous
studies by the Georgetown University Center on Education and the
Workforce, among others, have analyzed
wage differences by major. The Tennessee report breaks new ground,
says Jeff Strohl, director of research at the Georgetown center, by
marshaling data from disparate state agencies to identify the
average first-year wages of the state's college graduates between
2006 and 2010, and linking those data to the majors they pursued and
institutions they attended.
Continued in article
From the Chronicle of Higher
Education
Look up salary data for your university ---
http://chronicle.com/article/faculty-salaries-data-2012/131431#id=144050
Slide Show From Bloomberg Business Week, November 2012
Top B-Schools With the Highest-Paid MBAs ---
http://images.businessweek.com/slideshows/2012-11-01/top-b-schools-with-the-highest-paid-mbas
Jensen Comment
This is one of those reports where it pays to look at the variance and
kurtosis as well as a measure of central tendency (mean or median).
Also it's not clear how variable compensation (sales commissions and
bonuses) are factored in with fixed portions of salaries. For example,
many of the best entry-level jobs on Wall Street are variable,
performance-based compensation jobs.
And how are benefits factored into the study?
For example, some employees who travel most of the time don't make big
sacrifices for personal housing. I know one, for example, who uses her
parent's address for "home" since she's almost never home. In reality,
she lives most of the year in luxury hotels at the expense of her
employer and dines in the finest restaurants. Is this added
"compensation?"
And note that if your NYC employer sends you to London or Los Angeles
for a long-term consulting engagement, your luxury hotel bill may be
paid for seven days a week even if you only work five days a week. This
is because paying taxi and travel expenses to bring you back to NYC
every week end is more expensive than paying your luxury hotel bill for
those days when your not on the job.
Best and Worst 2012 MBA Job Placement - Job Offers Abundant, for Most -
Business Week
http://images.businessweek.com/slideshows/2012-11-01/best-and-worst-2012-mba-job-placemen
Jensen Comment
Placement data can be somewhat misleading, especially for very small programs.
For example, before Trinity University dropped its MBA program a significant
proportion of the graduates were full-time military employees. At the time San
Antonio's major employers were five military bases, two of which like Lackland
and Kelly were enormous, although many of our MBA students were medical military
from the Brooke Army Hospital. But placement of other graduates was really
problematic. Also the MBA program did not coincide with Trinity's goal of having
only full-time students in both undergraduate and graduate programs. Enrollments
and placements of full-time MBA students were weak, and the MBA program was
dropped. Later a MS program in accountancy was added after Texas passed the
150-credit rule.
The above Bloomberg Business Week link has a somewhat dubious
advertisement from Thunderbird. In that advertisement, Thunderbird rightly
claims to be the Number 1 School for Global Business in various
international-specialty rankings ---
http://www.thunderbird.edu/about-thunderbird/rankings
But Thunderbird does not even make the Top 30 in terms of the above MBA
placement rankings where Thunderbird advertises itself as being Number 1.
Bob Jensen's threads on business school rankings by Bloomberg
Business Week, US News, the WSJ, The Economist, Financial Times,
etc. ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#BusinessSchoolRankings
Every year, my students at Stanford Graduate
School of Business who want to work for startups ask me for advice on
where they should work. I disappoint them by recommending that they not
to go work for a startup at all.
Andy Rachleff, "48 Hot Tech Companies To Build A Career,"Wealthfront,
October 25, 2012 ---
https://blog.wealthfront.com/hot-mid-size-silicon-valley-companies/
Every year, my students at Stanford GSB who
want to work for startups ask me for advice on where they should
work.
I disappoint them by recommending that they
not to go work for a startup at all. I tell them three words I know
it’s hard for them to hear: You’re not ready.
I prefer to see them take their first jobs
after graduation at midsized companies with momentum, not startups,
because they are the companies most likely to be big successes.
Why is success so important? You get more
credit than you deserve for being part of a successful company, and
less credit than you deserve for being part of an unsuccessful
company. Success will help propel your career. At a fast-growing
company, chances are good you’ll have a higher position two years
after you join. At a slow-growth company, no matter how good a job
you do, you won’t have the same opportunities to advance.
When it comes time to leave the successful
company, you’ll be able to write your own ticket. No one will
remember if you were employee 20 or 120. Everyone wants to recruit
or back people from successful companies because they know/think
people carry the lessons of success with them.
You also may gain something that’s even
more valuable from that first job: insight. If you’re part of a
company that’s the leader in a market for which you have a passion,
you’re more likely to develop a unique insight that could lead to a
great company of your own.
Facebook’s Lesson
Perhaps the best illustration of the way a
successful company puts a halo over careers is Facebook. Back in
2006 and 2007, a handful of my students were considering job offers
from what was then a mid-sized company with about $50 million in
revenue. Some of my students were on the verge of rejecting those
offers: Dreaming of startups, they believed that a job at a company
already on a path to rapid growth would be boring.
Some of them listened to my advice, took
jobs at Facebook, and are now benefitting. They are now able to
start their own ventures, become venture capitalists or take their
pick of jobs at hot companies. They’re writing their own tickets.
Facebook is a rarity, of course: its market
capitalization is so large that even employees who joined fairly
late in the game got big payouts. In most cases, joining a mid-sized
company, even one with enough momentum to reach an IPO while you’re
there, won’t make you rich.
Making money is not the point for most of
my students, anyway. They take my classes because they’re the kinds
of people who want to make an impact on the world. Because they have
that desire, and they’re impatient to fulfill it, some of them come
away quite disappointed when I suggest to them that they ought to
wait.
But the odds are that your startup is going
to fail. Why take that chance early in your career? If you’re
willing to take three years to work for a company with momentum,
then your experience at the midsize company will allow you to do
something more amazing in the future. Not many people get multiple
shots at starting a company, so why not put your best foot forward?
By the way, if it hasn’t been obvious
already, I don’t buy the adage that you should start a company when
you’re very young, because that’s when you have the energy. Insight,
not energy, is the key to success in technology and insight doesn’t
arrive on a particular timetable.
Why Mid-Size Companies?
After we talk, I offer to give my students
a spreadsheet of 45-50 companies, U.S.-based or with a strong
presence here, that fit my description of an ideal company to work
for. I compile this list each year by talking to about 10-15 venture
capitalists at the premier venture firms.
Now, I’m sharing my list with you, as a
follow on to the posts we’ve written on our
Startup Compensation Tool
and
How Do I Choose Where To Work?.
All our advice on Silicon Valley careers is
based on a simple idea: that your choice of company trumps
everything else. It’s more important than your job title, your pay
or your responsibilities.
The companies we’ve listed have revenue
between $20 and $300 million. They’re growing fast and appear likely
to maintain their momentum for the foreseeable future. It’s
important that your potential employer have enough momentum to keep
growing rapidly until you decide to leave – probably after about
three or four years if you want to assure yourself of the
aforementioned halo.
Why not a startup? Most
startups fail. That means their risk/reward ratios don’t look good.
That concept is important in investing, too: You want the highest
possible return for the least amount of risk. We pay a lot of
attention to risk/reward ratios at Wealthfront to build our clients’
portfolios; you should apply the same sort of thinking when it comes
to your career.
Why the upper limit of revenue?
Above a certain company size, the lessons you learn are no longer
applicable to the startup you eventually want to be part of. For
example, if you join Facebook or Google today, you’ll spend most of
your time learning how to take advantage of your company’s massive
market position. Startups don’t have that problem so those lessons
learned are not of much value. Company-building lessons tend to
translate until around $300 million of revenue, though that is
extremely subjective.
What Happens Next?
My students who put off their startup
ambitions to join mid-size companies with momentum have been more
successful than my students who choose to start their own companies
directly after school. Their experiences at their first jobs helped
them develop an expertise that placed them in high demand.
After those first jobs, some of my former
students have taken senior positions with hot startups. Others have
founded companies, and had an easier time getting funded than they
otherwise could have. They were smart: They took the time to make
themselves ready for their startup careers. Now, those careers are
taking off.
Continued in article
Jensen Comment
The Stanford GSB does not have a program geared to becoming a CPA and
places very few graduates in CPA firms. But Andy's advice about not
going to work for a startup firm as an accountant applies to graduates
of accounting programs. The best starting point for an accounting
graduate is a large CPA firm as a rule or the IRS. Seek out the firms
with the best training programs and those that provide benefits for
passing the CPA examination. The largest CPA firms and the IRS generally
have the best training programs. Also they usually have better
opportunities for exposures to wider types of clients, clients who in
turn often make job offers to the CPA firm employees that impress them
the most. And both the large CPA firms and the IRS look good on a
resume.
Having been an FBI agent also looks good on a resume, but the FBI
generally does not hire inexperienced accountants fresh out of college
except possibly those graduating with a combination of high IT and
accounting credentials. But the FBI now hires more experienced
accountants than lawyers.
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
There are so many business school rankings by Bloomberg Business Week
that it boggles my mind, to say nothing of the other media rankings of
business schools by U.S. News, The Wall Street Journal, Financial Times,
The Economist, etc.
The above link is one of the more interesting rankings because it
vividly illustrates what I call the "Vegetable Problem of Aggregation"
in the context of accounting number aggregations at
http://faculty.trinity.edu/rjensen/FraudConclusion.htm#BadNews
Take a look at how your
favorite greens stack up in the chart below:
Green
(Raw - per 100 g serving) |
Vitamin A |
Vitamin C |
Fiber |
Folate |
Calories |
Arugula |
2,373 IU |
15
mg |
1
g |
97
mcg |
25 |
Chicory |
4,000 IU |
24
mg |
4
g |
109.5 mg |
23 |
Collards |
3,824 IU |
35.3 mg |
3
g |
166 mcg |
30 |
Endive |
2,050 IU |
6.5 mg |
3
g |
142 mcg |
17 |
Kale |
8,900 IU |
120 mg |
2
g |
29.3 mcg |
50 |
Butterhead (includes Boston and Bibb) |
970 IU |
8
mg |
1
g |
73.3 mcg |
13 |
Romaine |
2,600 IU |
24
mg |
1
g |
135.7 mcg |
14 |
Iceberg |
330 IU |
3.9 mg |
1
g |
56
mcg |
12 |
Loose
leaf (red, green) |
1,900 IU |
18
mg |
1
g |
49.8 mcg |
18 |
Radicchio |
27
IU |
8
mg |
0
g |
60
mcg |
23 |
Spinach |
6,715 IU |
28.1 mg |
2
g |
194.4 mcg |
22 |
Source: U.S. Department of Agriculture, 1999 |
Also see
Examination of Front-of-Package Nutrition Rating Systems and Symbols ---
http://iom.edu/Activities/Nutrition/NutritionSymbols.aspx
Systemic Problem: All
Aggregations Are Arbitrary
Systemic Problem: All Aggregations Combine Different Measurements With
Varying Accuracies
Systemic Problem: All Aggregations Leave Out Important Components
Systemic Problem: All Aggregations Ignore Complex & Synergistic
Interactions of Value and Risk
Systemic Problem: Disaggregating of Value or Cost is Generally
Arbitrary
While looking at the following
diet guides, it dawned on me that perhaps accounting reports should be
more like food labeling and comparison tables/charts rather than the
traditional bottom line reporting. The problem with accounting is
bottom-line reporting of selective and ill-conceived aggregates such as
earnings-per-share or debt/equity. Suppose spinach has an e.p.s. of
4.67 in comparison to 5.62 for Kale. The aggregations all depend upon
how components are measured, how they are weighted (e.g., Vitamin A
versus Folate weighting coefficients), and what components are
included/excluded (e.g., Vitamin A is included below, but Vitamin B
components are ignored). The same is true of e.p.s. in financial
reporting. The "bottom line" depends in a complex way upon how
components are measured and weighted as well as upon what components are
included/excluded.
In a similar manner, accounting
aggregations all depend upon how components are measured, weighted, and
included/excluded. Cash is measured with great accuracy whereas
goodwill impairment is highly inaccurate, thereby causing greater error
range when cash and goodwill are added together in balance sheets.
Similarly, in the "New Economy" where intangible intellectual capital is
soaring in value relative to traditional tangible assets, the
intangibles left off the balance sheet may be far more important that
the combined value of everything included in the balance sheet.
An even larger problem is that
the value and risk of diet components depend heavily upon complex and
synergistic relationships. For example, research shows that after the
body hits its maximum threshold of Vitamin C, it simply throws off the
excess. Kale far surpasses endive in Vitamin C content, but this is
irrelevant in a diet overflowing in Vitamin C from other sources such as
citrus fruits. Some persons may be allergic to components that are of
greater value to other persons.
In a similar manner accounting valuations are greatly complicated by
synergistic complexities. A patent in the hands of one company may be
all but useless in the hands of another company. Indeed some companies
buy up patents just to squelch newer technology that threatens existing
products. Similarly, financial risk is not a fixed thing. It is a very
dynamic threat that is based upon all sorts of contingencies such as
world events and media coverage that can interact heavily with the level
of risk at any point in time.
For similar reasons
disaggregating of values/costs is generally arbitrary. Firstly there is
the famous problem of joint production cost allocation arbitrariness
noted in the early writings of John Stuart Mill (The Principles of
Political Economy) and Alfred Marshall (The Principles of
Economics). Then there is the problem of synergistic complexities
noted above. For example, suppose spinach sells for $5 per bunch. Any
attempt to disaggregate that $5 into additive values of nutrients will
be arbitrary, because nutrients in combination may be worth more or less
than the sum of disaggregated values of each nutrient. This gives rise
to the systemic problem of consolidation goodwill when two or more
companies are combined into one whole.
Bob Jensen's threads on media rankings of colleges and
universities ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#BusinessSchoolRankings
"How to Reduce America's Talent Deficit: At Microsoft, we
have more than 6,000 open jobs in the U.S. Some 3,400 of the positions
are for engineers. Schools aren't producing graduates with the skills
needed in the marketplace," by Brad Smith (executive vice president
and general counsel of Microsoft) , The Wall Street Journal,
October 18, 2012 ---
http://professional.wsj.com/article/SB10000872396390443675404578058163640361032.html?mg=reno64-wsj#mod=djemEditorialPage_t
Each month, when the government publishes
the national jobs report, Americans pick over small movements in the
headline rate of unemployment. In doing so, they largely miss a
crucial aspect of the U.S. jobs crisis.
Many American companies are now creating
more jobs for which they can't find qualified applicants than jobs
for which they can. Thus the economy faces a paradox: Too many
Americans can't find jobs, yet too many companies can't fill open
positions. There are too few Americans with the necessary science,
technology, engineering and math skills to meet companies' demand.
At
Microsoft,
MSFT -0.32%
we have more than 6,000 open jobs in the U.S., a 15% increase from a
year ago. Some 3,400 of these positions are for engineers, software
developers and researchers (a 34% increase from last year).
Other companies face the same problem. As
the national unemployment rate this summer exceeded 8% for the third
consecutive year, the rate in computer-related occupations was only
3.4%. Even outside of the technology sector, nearly every firm is in
some way a software company given the importance of automation. So
America's skills shortage affects businesses in every industry and
region.
Unfortunately the problem is likely to get
even worse. According to the U.S. Bureau of Labor Statistics, the
U.S. this year will create some 120,000 new jobs requiring at least
a bachelor's degree in computer science. But all of our colleges and
universities put together will produce only 40,000 new bachelor's
degrees in computer science. The BLS forecasts that this demand for
new jobs will persist every year this decade. And when one adds the
high multiplier effect of engineering jobs—each one filled typically
leads to five additional jobs in the economy, according to Berkeley
economist Enrico Moretti—it is clear that this problem touches all
of us.
If we don't increase the number of
Americans with necessary skills, jobs will increasingly migrate
abroad, creating even bigger challenges for our long-term
competitiveness and economic growth. This is a personal crisis for
young people facing an increasing opportunity divide.
America has more than 30,000 public high
schools and 12,000 private ones, yet last year only 2,100 of these
schools offered the advanced placement course in computer science.
Four decades after Bill Gates and Steve Jobs were teenagers, we
still live in a country where you have to be one of the fortunate
few to take computer science in high school.
Last month Microsoft laid out a proposal
for how to begin addressing the problem. It couples long-term
improvements in American education with short-term, skills-focused
immigration reform. Done right, immigration reforms can even help
fund education improvements, ensuring that more Americans gain the
skills they need.
We need a national "Race to the Future"
akin to the Obama administration's Race to the Top grant program
(which Mitt Romney praises). It would provide new funding and
incentives for states to:
• Strengthen science, technology,
engineering and math education in grade school by recruiting and
training teachers and implementing the Common Core State
Standards and the Next Generation Science Standards.
• Broaden access to computer science in
high schools.
• Help colleges and universities raise
their graduation rates.
• Expand colleges' capacity to produce
more degrees in science, technology, engineering and math, with
a particular focus on computer science.
On the immigration front, Congress should
create a new, supplemental category with 20,000 annual visas for
people with science and technology skills that are in short supply.
Lawmakers should also take advantage of existing, unused green cards
by allocating 20,000 for workers with these vital skills.
It would be fair and feasible to make these
supplemental steps more expensive, for example by charging $10,000
for the new high-skill visas and $15,000 for the new green cards.
(Large companies pay about $2,300 for each such H-1B petition
today.) This would raise $5 billion over the next decade that the
federal government could provide to states committed to smart
reforms for cultivating important job skills.
Microsoft is convinced that these
initiatives could earn bipartisan support, but lawmakers need to
summon the will to act. We can't expect to build the economy of the
future with only the jobs and ideas of the past.
Jensen Comment
In spite of the tone of the above article there are a number of things
to keep in mind.
- The science and technology (STEM) opportunities for graduates
(bachelor, masters, and Ph.D. graduates) are heavily skewed among
the sub-disciplines. Whereas chemistry, physics, mathematics, and
geology graduates struggle to advance their careers with good jobs
following graduation, IT and most of the engineering graduates face
better prospects. Emory University dropped its geology program, and
Texas universities dropped some of their physics programs. For
better job opportunities many science and engineering graduates
enter MBA programs and/or doctoral programs. Opportunities in law
declined.
- Science and engineering Ph.D. graduates finding opportunities in
industry do not find the same opportunities in academe. Universities
that have tenure track openings in science and engineering are
usually flooded with highly qualified applicants. And affirmative
action comes into play where qualified women and minorities are
favored to fill those science and engineering tenure track openings.
There are shortages of women and minority candidates in engineering
and computer science in industry and in academe.
- Job opportunities are geographically skewed for science and
technology graduates. For example, the son of one of our best
friends up here in the White Mountains is graduating in IT this year
from a regional college in northern New Hampshire. If he had instead
been an accounting graduate there would be opportunities to work for
a regional accounting firm, business firm, and even regional
government agencies. After he gains experience say in tax
accounting, there might also be opportunities to start his own
accounting firm northern New Hampshire. But there are virtually no
decent IT opportunities regionally, just as there are virtually no
regional opportunities for most any type of engineering, science, or
mathematics graduate. IT and engineering job opportunities exist but
vary geographically. In most instances graduates must move to large
cities offering varying career opportunities. The woman and mother
of the IT graduate mentioned above has two degrees in entomology.
But to live in Littleton, New Hampshire her business is into
landscaping, house painting, and wallpapering. To find a career in
entomology she would have to move far from Littleton, NH.
- In the 1950s, an accounting and engineering graduate with a C
average generally faced some good job opportunities following
graduation. With grade inflation in colleges and universities over
the ensuing decades, a C average graduate in almost any discipline
faces dismal job opportunities in 2012. For example, those
accounting graduates having a 3.5 or higher grade averages have the
world at their feet in the 21st Century in North America. But those
with 2.3 grade averages might have to move back home to live with
their parents and/or accept a job that does not even require a
college education. The same thing has happens to 2.3 g.p.a. science
and engineering graduates.
The Sad State of North American
Accounting Ph.D. Programs
Accounting at a Tipping Point (Slide Show)
Former AAA President Sue Haka
April 18, 2009
http://commons.aaahq.org/files/20bbec721b/Midwest_region_meeting_slides-04-17-09.pptm
Bob Jensen's threads on the
Sad State of North American Ph.D. Programs ---
http://faculty.trinity.edu/rjensen/Theory01.htm#DoctoralPrograms
Bob Jensen's threads on career opportunities are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
AccountingWeb's 50-State Report on College and Career Readiness
---
http://www.accountingweb.com/article/50-state-report-college-and-career-readiness/219874?source=education
With all fifty states and the District of
Columbia (DC) having adopted college- and career-ready standards in
English and mathematics,
Achieve's seventh annual
Closing the Expectations Gap report (released September 13) shows how all states
are aligning those standards with policies to send clear signals to
students about what it means to be academically prepared for college
and careers after high school graduation.
For the first time, the report also
details not only states' policy progress on the college- and
career-ready agenda, but also their efforts to implement those
policies, since only faithful implementation can improve student
achievement. The report was released during the opening session
of Achieve's eighth annual American Diploma Project Leadership
Team Meeting in Alexandria, Virgina, which brought together
nearly 300 education leaders in cross-sector teams from
thirty-four states.
"With all states adopting college- and
career-ready standards, they have now taken the first step
toward reorienting the mission of their K-12 systems to reflect
the demands of the twenty-first century," said Mike Cohen,
Achieve's president, to a crowd of education leaders from across
the country. "As this report shows, various states are making
some movement toward fulfilling the college- and career-ready
agenda by putting new policies in place to support this new
mission, but there is still much room for progress to be made."
Achieve conducts an annual policy survey
that asks all fifty states and DC whether they have adopted
standards, graduation requirements, assessments, and
accountability systems aligned to the expectations of two- and
four-year colleges and employers. The national survey of state
education leaders has measured the same areas of reform each
year since the National Governors Association and Achieve
cosponsored the National Education Summit in 2005. This year's
survey reveals the following results:
Standards:
- All fifty states and DC have adopted
standards aligned to the expectations of college and careers.
- Forty-six states and DC have adopted
the Common Core State Standards.
- Four have state-developed College and
Career Ready (CCR) standards.
- By 2015-2016, all English language
arts and mathematics instruction should reflect CCR
expectations.
Graduation Requirements:
- Today, twenty-three states and DC have
adopted college- and career-ready graduation requirements that
require all students to meet the full set of expectations
defined in the CCSS.
- Hawaii, Iowa, and Washington raised
their graduation requirements to the college- and career-ready
level in 2011.
Assessments:
- Today, eighteen states administer
college- and career-ready high school assessments capable of
producing a readiness score that postsecondary institutions use
to make placement decisions.
- Four new states - Florida, North
Carolina, Oregon, and Wyoming - joined this list in 2011 by
adopting a policy to administer a college- and career-ready test
to its high school students.
- It is expected that forty-four states
and DC that are participating in one or both Race to the Top
assessment consortia will meet this criteria when the next
generation assessments are administered for the first time in
2014-2015.
Accountability:
- A majority of states, thirty-two, have
now incorporated at least one of four accountability indicators
that Achieve has identified as critical to promoting college and
career readiness.
- As in last year's report, only Texas
meets Achieve's criteria regarding the use of all indicators in
its college- and career-ready accountability system.
- Florida, Georgia, Indiana, and
Kentucky have included the use of multiple college- and
career-ready indicators in their accountability systems in
multiple ways.
- Since last year, states have made
important gains on the college- and career-ready agenda with all
adopting college- and career-ready standards, and additional
states moving toward more accountability.
- Even as additional progress is made,
states have further to go by turning their attention to the
implementation of standards and related policies.
"States and the larger education
community must make sure educators have access to resources like
quality instructional materials and effective professional
development," Cohen urged. "Success is going to take the
combined effort of all education stakeholders - students,
teachers, principals, K-12 leaders, school board members,
superintendents, administrators, policymakers, postsecondary
education leaders, the business community, and parents."
Continued in article
"LSAT Scores at Top Schools Are Dropping Like Flies," by Vivia
Chen, The Careerist.com, September 7, 2012 ---
http://thecareerist.typepad.com/thecareerist/2012/09/law-school-applicants-dumbing-down.html
If you think you're a pretty smart
cookie—but not spectacularly so—this might be the year that you can
squeeze into a better law school than you thought possible.
The reason is simple: There are fewer
applicants, which results in more opportunities at more prestigious
law schools. You've probably heard about
that 25 percent drop in law school applications
in the past three years or so, but did you know that the top 14 law
schools will be forced to accept students who are below the top 2
percent of their LSATs? (Sobs, please.)
Here's the
nitty gritty from Blueprint, an LSAT
tutoring company, based on statistics from the
Law School Admissions Council, Inc.:
We see that in
2010/2011, there were 3,430 students in the top 2 percent on the
LSAT (171+), which is at or near the median LSAT score for most
elite (top 14 or T14 as determined by U.S. News & World Report
rankings) law schools. That number drops to 2,600 in 2011/2012,
resulting in nearly 1,000 fewer top percentile scores from which law
schools can recruit.
So what does this all mean? Naturally,
Blueprint is telling people to go for it—since it's in the LSAT
tutoring biz. Here's how it explains the trickle-down effect of
lowered law school admissions standards:
With fewer
applicants at the top for the same number of slots, the entire
admissions game is going to undergo a large shift. Students
traditionally just outside the T14 based on their numbers will find
themselves admitted, or on waitlists. As they jump at the
opportunity to mortgage their future for a top school . . . their
slots in T20 schools will open up for those below them, and so on.
LSAT scores more than any other aspect of
the application determines acceptance, notes Blueprint: "LSAT
accounts for up to 60 percent of the admission decision."
Blueprint also says that applicants are too
pessimistic about the cost of law school tuition and their prospects
for getting into law schools. It conducted a poll of of nearly 600
prospective law students, in conjunction with Above the Law.
Their finding: "The majority of prelaw students are actually
overestimating the cost of attending law school." It also finds that
more than a quarter of the students (27 percent) think it's harder
to gain admission than it actually is.
So is law school easier to get into now?
Perhaps. But is that a good enough reason to dedicate yourself to
three years of schooling for a profession you might not like
(assuming you can get a job that requires a legal degree)?
Uh, I don't think so.
Jensen Question
So where are those top prospects going who decide not to go to law
school?
Answer
I really don't know, but if they were thinking about law school as
undergraduates not many of them probably did not earn enough
undergraduate credits for accounting, architecture, engineering,
medical school, vet school, and science. Some may be applying for
government work. Others may be applying for doctoral programs in
humanities. Who knows?
A goodly number of them may instead be applying to MBA programs in
prestigious universities. I'll bet that's it!
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
"Why an MBA Is Not Always the Right Choice," by Rose
Martinelli , Bloomberg Business Week, April 4, 2012 ---
http://www.businessweek.com/articles/2012-04-04/why-an-mba-is-not-always-the-right-choice
A guest post from Rose Martinelli, formerly the
longtime admissions director at the University of Chicago’s Booth
School of Business, where she wrote a popular admissions blog, The
Rose Report.
My last two posts focused on knowing
yourself, making sense of all the pieces, and sharing what you
learned with your circle of supporters. Now it’s time to focus on
evaluating educational options by defining two of the most common
academic pathways—subject-focused master’s degrees and MBA degree
programs.
Subject-focused master’s degrees are
typically one-year academic programs that focus on a single topic in
great detail, with application of these concepts focused in
functional areas. Programmatic features vary by school and program,
so make sure to do your homework, especially if particular programs
or career support are among your priorities.
MBA programs, on the other hand, are
typically two-year programs, although they are now offered in
one-year or accelerated formats. These “professional” programs focus
on developing the fundamental tools of resource management
(accounting, finance, operations, statistics, marketing, human
resources, economics, and so forth).
The vast majority of MBA programs require
core classes, with the opportunity to pursue majors or
concentrations in specific areas of study. The value of MBA programs
can be found through the breadth of exposure from academic options
and co-curricular activities to professional outcomes. Offered in
full-time, part-time, and executive formats, this degree can be
taken at various stages in your professional development.
Which type of program is right for you?
While there are no right or wrong answers here, I would recommend
that your choice be based upon your undergraduate education, prior
work experience, and future career goals.
If you do not have an undergraduate
business degree, the MBA may be a good option because of its focus
on the fundamentals of business and experiential opportunities, as
well as the breadth of career support available. Even students who
have pursued economics majors or who have done consulting can
benefit from the MBA degree if one of the driving reasons for
pursuing education is the chance to explore and experiment.
If you have an undergraduate business
degree and want additional depth in a particular area, the
subject-oriented masters degree may be ideal. Typically, these are
smaller programs that provide focused instruction in that area of
study. While another option for business undergraduates may be to
pursue an MBA, selecting a school with a flexible core curriculum
will be important if you do not want to repeat prior coursework.
We’ll talk more about that in future posts.
If you are just completing your
undergraduate degree and wish to pursue additional education in
order to prepare you for your first career step, a subject-oriented
masters degree may be just the right choice. Over the past several
years, there has been an expansion in these programs, largely fueled
by the lack of good employment opportunities for college graduates,
as well as the limited number of MBA programs that admit students
without work experience.
Continued in article
Jensen Comment
In 1982 when I joined the faculty at Trinity University I taught
mostly in Trinity's small MBA program which was one of the three
surviving masters programs that existed after 20+ masters programs
had already been dropped. Interestingly Trinity dropped most of its
masters programs after enormous gifts to its endowment made it
possible to increase the competitive prestige of its undergraduate
programs. Trinity now ranks extremely high in the nation in terms of
endowment per student.
But in the 1980s our MBA program was very small and most of my
classes had less than ten students, many of whom were military
officers stationed at the six major army and air force bases in San
Antonio. We did a market study and discovered what we already knew
--- San Antonio was just not a good city for placements of MBA
graduates since it had so little business sector industry. And our
MBA program just did not have a reputation to compete with MBA
graduates of the University of Texas, Texas A&M, Texas Tech, and
SMU.
And so we dropped the MBA program. Some years later when Texas
adopted the 150-hour rule to take the CPA exam in Texas, we
installed a new one-year masters program that mostly served our own
graduating accounting students. We prospered with our small masters
program in accounting mostly because the then Big Five in San
Antonio took a goodly share of our graduating masters students in
accounting. Houston and Dallas Big Five CPA firms picked up most of
the other graduates.
In other words we could place a goodly share of our masters
students in accounting locally or in nearby Dallas and Houston. This
never was the case for our MBA program.
"Top B-School Stories of 2011: 2011 brought good news on the
MBA job front, with unconventional careers more popular than ever.
Plagiarism and cheating marred an otherwise-upbeat year," by Alison
Damast and Erin Zlomek, Business Week, December 28, 2011 ---
http://www.businessweek.com/business-schools/top-bschool-stories-of-2011-12282011.html
Graduates Who Are Happy to Land Minimum Wage Careers
"Little-Known (usually unaccredited) Colleges Exploit Visa Loopholes
to Make Millions Off Foreign Students," by Tom Bartlett, Karin
Fischer, and Josh Keller, Chronicle of Higher Education, March
20, 2011 ---
http://chronicle.com/article/Little-Known-Colleges-Make/126822/
Bob Jensen's threads on for-profit colleges working in the gray
zone of fraud ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#ForProfitFraud
Bob Jensen's threads on diploma mills ---
http://faculty.trinity.edu/rjensen/FraudReporting.htm#DiplomaMill
"Execs battle skills gap (including accounting) in hiring despite
high unemployment Execs battle skills gap in hiring despite high
unemployment," by Ken Tyscic, CGMA Magazine, July 26, 2012
---
Click Here
http://www.cgma.org/Magazine/News/Pages/20125850.aspx?cm_mmc=smartbrief-_-30Jul12-_-CPALD-_-skillsgap&utm_source=smartbrief&utm_medium=30Jul12&utm_term=CPALD&utm_content=
For the past six years, VASCO Data Security
has dealt with a chronic problem: It hasn’t been able to easily
recruit qualified workers for its software and internet security
operations in Europe. And the plight hasn’t gotten easier – even as
a global economic crisis has led to high unemployment throughout the
continent.
“It seems like in Brussels and in Zurich,
both, we have a hard time when a spot opens up, filling it,” VASCO
CFO Gary Robisch said. “A lot of times we have to settle for
somebody that doesn’t exactly match the qualifications that we
want.”
The economics don’t seem to make sense.
High unemployment, one would presume, would make it easier to fill
jobs. The 17-country euro currency bloc hit a record in May when
unemployment rose to 11.1%, while the rate across the EU was 10.1%,
according to Eurostat, the EU’s statistics office. US unemployment
has hovered between 8.1% and 8.3% for the past six months.
Yet employers worldwide are still
struggling to find workers with the skills to fill a wide variety of
jobs. The situation is fuelling a human resources conundrum as
employers ponder whether they should hold out and pony up for
candidates with key skills or look to on-the-job training for
promising candidates.
Companies report difficulty locating IT
professionals, engineers, accountants and specialised
workers such as tugboat captains and MRI technicians. The conundrum
is particularly glaring in pockets of relative prosperity, as VASCO
is learning; the unemployment rates in Belgium and Switzerland are
lower than European averages. A similar scenario has emerged in the
United States, where companies have been clamouring to grow after
years of cuts.
“It just astounds me,” said Tom Kennedy,
vice president and CFO of marine construction and environmental
remediation company J.F. Brennan, which is having trouble recruiting
a safety director, tugboat pilots and project manager-level
engineers who are willing to travel for a company that does business
in 18 US states.
“After doing this for 35 years, I’ve never
seen it like this,” Kennedy said. “You could run an ad any place [in
years past] and get 30 or 40 applicants. Now you get five to 10.”
The American Institute of CPAs’ Business
and Industry Economic Outlook Survey for the second quarter of 2012
demonstrated the recruitment difficulties that management
accountants are facing. Half of the 1,250 respondents said they have
had difficulty filling open positions because their organisations
haven’t been able to find individuals with the appropriate
qualifications.
Worldwide problem
Other reports indicate a similar problem
worldwide. In the PwC Global CEO survey for 2012, 43% of global
respondents said that, in general, it has become more difficult to
hire workers in their industry. Just 12% said it has become easier
to hire. In addition, 29% of CEOs said they were unable to pursue a
market opportunity because of talent constraints.
Continued in article
Job and Career Search Helper Site
O*Net OnLine ---
http://www.onetonline.org/
Yahoo Education ranks "hot careers" through 2018 and beyond.
Accountants/audits get top billing, which is probably the first time we've
ever been called "hot."
http://education.yahoo.net/articles/hot_careers_through_2018.htm
Deloitte University ---
http://careers.deloitte.com/united-states/students/csc_general.aspx?CountryContentID=16027
"Business Degrees Skyrocket in Popularity in Asia," FINS
Asia-Pacific, October 7, 2011 ---
Click Here
http://asia-jobs.fins.com/Articles/SBB0001424053111903285704576560832111849732/Business-Degrees-Skyrocket-in-Popularity-in-Asia
Accounting Careers are Hot at Rank 2 According to College Board
"Hottest Careers for College Graduates: Experts Predict Where the
Jobs Will Be in 2018," College Board, December 30, 2010
---
http://www.collegeboard.com/student/csearch/majors_careers/236.html
Government economists estimate which
occupations will have the most job openings between 2008 and 2018.
Openings occur because new jobs are created and because workers
retire or leave the field for other reasons.
Check out these top 10 lists of
occupations, sorted by the level of education typically required:
Occupations with the Most Job Openings: Graduate Degree
Occupation
|
Total Job Openings 2008–2018 |
Postsecondary teachers |
553,000 |
Doctors and surgeons |
261,000 |
Lawyers |
240,000 |
Clergy |
218,000 |
Pharmacists |
106,000 |
Educational, vocational, and school counselors
|
94,000 |
Physical therapists |
79,000 |
Medical scientists, except epidemiologists |
66,000 |
Mental health and substance abuse social workers |
61,000 |
Instructional coordinators |
61,000 |
Occupations with the Most Job Openings: Bachelor's Degree
Occupation
|
Total Job Openings 2008–2018 |
Elementary school teachers, except special education |
597,000 |
Accountants and auditors |
498,000 |
Secondary school teachers, except special and vocational
education |
412,000 |
Middle school teachers, except special and vocational
education |
251,000 |
Computer systems analysts |
223,000 |
Computer software engineers, applications |
218,000 |
Network systems and data communications analysts |
208,000 |
Computer software engineers, systems software
|
153,000 |
Construction managers |
138,000 |
Market research analysts |
137,000 |
Occupations with the Most Jobs Openings: Associate's Degree or
Postsecondary Vocational Award
Occupation
|
Total Job Openings 2008–2018 |
Registered nurses |
1,039,000 |
Nursing aides, orderlies, and attendants |
422,000 |
Licensed practical and licensed vocational nurses |
391,000 |
Computer support specialists |
235,000 |
Hairdressers, hairstylists, and cosmetologists |
220,000 |
Automotive service technicians and mechanics |
182,000 |
Preschool teachers, except special education |
178,000 |
Insurance sales agents |
153,000 |
Heating, air conditioning, and refrigeration technicians |
136,000 |
Real estate sales agents |
128,000 |
Source: U.S. Bureau of Labor
Statistics
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
STEM (Science, Technology, Engineering, and Mathematics) ---
http://en.wikipedia.org/wiki/STEM_fields
"Re-Engineering Engineering Education to Retain Students," by
Josh Fischman, Chronicle of Higher Education, February 19, 2012
---
http://chronicle.com/blogs/percolator/re-engineering-engineering-education-to-retain-students/28745?sid=wc&utm_source=wc&utm_medium=en
Vancouver, British Columbia—Alarmed
by the tendency of engineering programs to hemorrhage
undergraduates, at a time when the White House has called for
an additional million degrees in science, technology, engineering
and math fields—known as STEM—education
researchers here at the annual meeting of the American Association
for the Advancement of Science proposed ways to improve the numbers.
At a symposium on engineering education, one group outlined a broad
revamping of curriculum, while another proposed more modest changes
to pedagogy.
The re-evaluation of curriculum is an
effort called
Deconstructing Engineering Education Programs.
The project is led by Ilene Busch-Vishniac,
the provost of McMaster University in Ontario and a mechanical
engineer, and involves faculty from nine universities, including
large public institutions like the University of Washington and
small private ones like Smith College.
Patricia Campbell, a collaborator on the
project who leads an education-consulting firm in Groton, Mass.,
said that the time to get an engineering degree was a major reason
that undergraduates dropped the major. “We call these four-year
schools,” she said. “But 64 percent of STEM undergraduates complete
their degrees in six years.” In engineering, she continued, that was
largely due to two factors: a proliferation of courses, called
“topic creep,” and rigid chains of prerequisite courses that
students had to follow to move on to higher courses.
Matthew Ohland, an associate professor of
engineering education at Purdue University, added that the rigid
structure not only prevented students from getting out of these
programs with a degree, but it also kept potential students from
migrating in. For example, he said, an industrial-engineering
program might insist its students take a particular economics course
to fulfill the program’s general-education requirements. But
sophomores and juniors might have already taken a related but
different econ course. To join the program, they would have to
retake economics, a strong disincentive.
Ms. Campbell (who was formerly a professor
at Georgia State University) and her colleagues attempted to
streamline this system, focusing on mechanical engineering. At nine
schools, they identified mechanical engineering courses that covered
2,149 topics. But after closely looking at the coursework, they
found a number of similar topics with different names, and narrowed
the list of unique topics to 833. Ultimately they grouped the
courses on those topics into 12 clusters, each of which contained
chains of classes focused around closely related topics, and
required few courses from another cluster. The clusters covered all
833 topics, and instructional times ranged from 52 to 115 hours,
with an average length of 91 hours. That corresponds, roughly, to
four hours of course time each week for one semester on the low end
or one year on the high end.
That means, Ms. Campbell said, that a
mechanical-engineering student could cover all the required topics,
but do so in four years, by taking three clusters each year.
It would also, she claimed, meet the
standards of the
Accreditation Board
for Engineering and Technology, because it
includes everything that accredited engineering programs do. Mr.
Ohland, who works as an evaluator for the board, said the accreditor
is open to new approaches like these, although he acknowledged there
were many of what he called “horror stories” about the accreditor
being very traditional and resistant to change. “If you do something
too wild, you have to convince [the board] that it won’t hurt
students.”
No institution has adopted the cluster
formulation. Ms. Campbell said that faculty members were leery of
the new course formulations, which grouped topics that they usually
taught with other topics they did not. The solution, she said, was
team-teaching of a course, but that’s something that pushes many
professors beyond their comfort levels.
A less-radical approach would be to improve
teaching techniques in existing courses, said another symposium
participant, Susan S. Metz, executive director of the Lore-El Center
for Women in Engineering and Science at Stevens Institute of
Technology in Hoboken, N.J. She leads the
Engage project, a consortium of engineering schools
at 30 institutions, supported by the National Science Foundation, to
identify best practices in teaching.
Continued in article
Jensen Comment
In accountancy we face somewhat similar problems in that even in
four-year degree programs accounting majors are required to take more
courses in their major than most other majors on campus, including
majors in economics, finance, marketing, and management. To that we now
add a fifth year of courses required to sit for the CPA examination.
But in accountancy we face a different job market than engineers.
There are no shortages of top accounting majors to meet the available
entry level jobs in CPA firms, corporations, and government agencies in
most states. There is a shortage of accounting PhD graduates, but these
shortages are not caused by undergraduate professional accountancy
curricula. The main problem lies in that accountancy PhD degrees take
twice as long as most other doctoral degrees and require mathematics and
statistics prerequisites not taken by former accounting majors ---
http://faculty.trinity.edu/rjensen/Theory01.htm#DoctoralPrograms
In the roaring 1990s there was great worry among the CPA firms that
accounting was losing top majors to the soaring bubble of jobs in
computer science, IT, and finance. But that bubble burst big time making
homeless people out of computer science, IT, and finance graduates.
Students who had not yet declared majors returned to the accounting fold
in spite of the expanding requirements to have a fifth year
(150-credits) to sit for the CPA examination.
The curriculum of accountancy has been and probably always will be
dictated by content of the CPA examination. For example, when the CPA
examination commenced to have larger and tougher problems in
governmental accounting, accounting programs beefed up governmental
accounting courses. The same beefing up is now taking place with ethics
content in the curricula. Perhaps this isn't such a bad thing until more
shortages of accounting graduates arise.
The problem with the CPA-exam focus of accounting curricula lies in
finding accounting instructors qualified to teach upper division
accountancy, auditing, tax, and AIS courses. There's a huge shortage of
accountancy PhD graduates and many of them are econometricians not
qualified to teach upper division accounting courses. As a result
accounting programs are turning more and more to the AACSB's
Professionally Qualified (PQ) adjunct instructors who are strong in
accountancy but do not have doctoral degrees. A few even have doctoral
degrees but are not interested in doing accountics research and
publishing required for AQ tenure tracks.
Hence even though we could streamline accounting curricula along the
same lines suggested for engineering majors in the above article, I
personally don't think there's a need to meet the supply of available
jobs in accountancy in the United States and Canada.
And apart from engineering and technology, I'm not certain that we
are not deluding high school students about career opportunities in
science and mathematics opportunities. For example, chemistry and
physics are now ranked among the "most useless" majors and students with
four-year degrees or even PhD degrees in these disciplines have to
branch into other fields to find careers.
"Texas May Cut Almost Half of Undergrad Physics Programs," Inside
Higher Ed, September 27, 2011 ---
http://www.insidehighered.com/news/2011/09/27/qt#271341
Note that "useless" in context means an oversupply of graduates relative to
job opportunities in a discipline. The jobs themselves may be high paying,
but 300 may apply for a single opening such that the 299 that got turned
away wish they'd majored in some other discipline.
As college
seniors prepare to graduate, The Daily Beast crunches the
numbers to determine which majors—from journalism to psychology
—didn’t pay.
Some
cities
are better than others for
college graduates. Some college courses are
definitely hotter
than others. Even
some iPhone apps are
better
for college
students than others. But when it comes down to it, there’s only
one question that rings out in dormitories, fraternities, and
dining halls across the nation: What’s your major?
Slide Show
01.Journalism
02. Horticulture
03. Agriculture
04. Advertising
05. Fashion Design
06. Child and Family Studies
07. Music
08. Mechanical Engineering Technology
(but not Mechanical Engineering per se)
09.
Chemistry
10. Nutrition
11. Human Resources
12. Theatre
13. Art History
14. Photography
15. Literature
16. Art
17.Fine Arts
18. Psychology
19. English
20. Animal Science
"Deloitte Commits $60
Million in Pro Bono Services to Nonprofit Organizations: New
Pledge Totals $110 Million to Make Communities Stronger and Advance Key
Women/Girls, Education and Human Service Organizations," MarketWatch, April 6, 2012 ---
http://www.marketwatch.com/story/deloitte-commits-60-million-in-pro-bono-services-to-nonprofit-organizations-2012-04-06
Career Options for Women (developed in Canada) ---
http://careeroptions.org/careeroptions/english_index.htm
GirlGeeks --- http://www.girlgeeks.org/
Women, Minorities, and Persons with Disabilities in Science and
Engineering ---
http://www.nsf.gov/statistics/wmpd/
Careerzone ---
http://careerzone.ny.gov/cz/stem/index.jsp
On December 17, 2011 Jim Martin posted the following on his MAAW Blog
---
http://maaw.blogspot.com/2011/12/careers-with-us-government-department.html
Careers with a U.S. Government
Department or Agency
Accounting graduates should also consider a career with the U.S.
government. For links to most U.S. Government departments and
agencies
see
http://maaw.info/NonProfitLinks.htm
Look for Careers and Paid Student Intern
Programs, or search the sites using those terms. There are a lot of
opportunities available to current and recent college graduates that
should not be ignored.
2012 Working Mother: 100 Best Companies ---
http://www.workingmother.com/best-company-list/129110
"A Degree of Practical Wisdom:: The Ratio of Educational Debt to
Income as a Basic Measurement of Law School Graduates’ Economic
Viability," by Jim Chen, SSRN, December 3, 2011 ---
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1967266
Abstract:
This article evaluates the economic viability
of a student’s decision to borrow money in order to attend law
school. For individuals, firms, and entire nations, the ratio of
debt to income serves as a measure of economic stability. The ease
with which a student can carry and retire educational debt after
graduation may be the simplest measure of educational return on
investment.
Mortgage lenders evaluate prospective borrowers' debt-to-income
ratios. The spread between the front-end and back-end ratios in
mortgage lending provides a basis for extrapolating the maximum
amount of educational debt that a student should incur. Any student
whose debt service exceeds the maximum permissible spread between
mortgage lenders' front-end and back-end ratios will not be able to
buy a house on credit.
These measures of affordability suggest that the maximum educational
back-end ratio (EBER) should fall in a range between 8 and 12
percent of monthly gross income. Four percent would be even better.
Other metrics of economic viability in servicing educational debt
suggest that the ratio of total educational debt to annual income
(EDAI) should range from an ideal 0.5 to a marginal 1.5.
EBER and EDAI are mathematically related ways of measuring the same
thing: a student's ability to discharge educational debt through
enhanced earnings. This article offers guidance on the use of these
debt-to-income ratios to assess the economic viability of students
who borrow money in order to attend law school.
. . .
To offer good
financial viability, defined as a ratio of education debt to annual
income no greater than 0.5, post-law school salary must exceed
annual tuition by a factor of 6 to 1. Adequate financial viability
is realized when annual salary matches or exceeds three years of law
school tuition. A marginal, arguably minimally acceptable level of
financial viability requires a salary that is equal to two years’
tuition. The following table compares some tuition benchmarks with
the salary needed to ensure the good, adequate, and marginal levels
of financial viability identified in this article:
Jensen Comment
This type of study, in my viewpoint, has some relevancy for professional
schools beyond the bachelors degree. However, I would not recommend this
type of analysis for students contemplating where to go after high
school. In the first four years, students get much more out of college
than career opportunities. There are liberal education quality
considerations, greatness of faculty considerations, socialization
experiences, dating, dorm living, and intimacy often leading to
marriage. Often more expensive schools have more to offer beyond the
classroom experience. By the time students are more mature after
graduation from college, the importance of some of these
"extracurricular" experiences often diminishes.
And if we look at post-graduate law, medicine, engineering, and
business schools, the job opportunities and salary expectations are not
independent of the halo effect of where the candidate graduated.
Diplomas from Harvard and Yale Law Schools add a great deal to salary
expectations. And there are huge advantages of being able to network
with alumni who often pave the way for job opportunities. What I'm
saying is going to a law school having a tuition of $60,000 may well be
worth it to graduates who take full advantage of the "extracurricular"
opportunities such as networking with alumni. And for all practical
purposes you can never be a U.S. Supreme Court justice unless you either
graduated from Harvard or Yale law schools or were on the faculty at one
of those law schools.
In other words, if you can swing it go to Yale Law school rather than
UCON (sorry Amy).
EGADS. I'm a snob.
Great Science For Girls ---
http://www.greatscienceforgirls.org/
Try Engineering ---
http://www.tryengineering.org
"Telling It as It Is (to new first-year students), by Craig
Stark, Inside Higher Ed, June 6, 2011 ---
http://www.insidehighered.com/views/2011/06/06/essay_on_how_honest_professors_should_be_to_students_about_the_economy
Jensen Comment
This article, perhaps appropriately, does not go into the ins and outs
of choosing a major upon arrival at a college or university. With a few
exceptions, this is perhaps a good idea except in certain majors where
there prerequisite first-year courses are essential such as in
engineering and pre-med. For accounting, the prerequisite first courses
can usually be delayed until the sophomore year. But the above article
really does not deal with choosing a major early on before students
learn a lot about education and careers during their first year on
campus. Much of what they learn comes from informal interactions with
students who are in their second, third, fourth, and higher levels of
study. I think it's a mistake for general curriculum teachers to try to
sell students on particular types of majors or particular types of
politics. Let students sort these things out for themselves as they
advance through the first and even the second years of study.
This article does talk about debt loads. I personally think that
students in the first term of college should learn about personal
finance, tax issues, and debt risk since many of them will make horrible
mistakes in college and after college.
Bob Jensen's threads on personal finance helpers ---
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
Advice and Bibliography for Accounting Ph.D. Students and New Faculty by
James Martin ---
http://maaw.info/AdviceforAccountingPhDstudentsMain.htm
"So you want to get a Ph.D.?" by David Wood, BYU ---
http://www.byuaccounting.net/mediawiki/index.php?title=So_you_want_to_get_a_Ph.D.%3F
Why accountancy doctoral programs are drying up and why
accountancy is no longer
required for admission or graduation in an accountancy doctoral program
---
http://faculty.trinity.edu/rjensen/Theory01.htm#DoctoralPrograms
Bob Jensen's threads on what went wrong with "accountics research" can be
found at
http://faculty.trinity.edu/rjensen/theory01.htm#WhatWentWrong
"The Value of a Humanities Degree: Six Students' Views," by
Jackie Basu et al., Chronicle of Higher Education, June 5, 2011
---
http://chronicle.com/article/The-Value-of-a-Humanities/127758/?sid=wb&utm_source=wb&utm_medium=en
"Toward a Plausible Rationale for the Humanities," by Frank
Donoghue, Chronicle of Higher Education, June 3, 2011 ---
http://chronicle.com/blogs/innovations/towards-a-plausible-rationale-for-the-humanities/29565?sid=cr&utm_source=cr&utm_medium=en
Bob Jensen's threads on Humanities Versus Business ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#HumanitiesVsBusiness
Accounting, Finance, and Business Graduate Average Salaries are
Neither in the Top Nor the Bottom Top Ten
"Major Decisions," by Kevin Kiley, Inside Higher Ed, May
24, 2011---
Click Here
http://www.insidehighered.com/news/2011/05/24/georgetown_study_of_salaries_for_different_majors_finds_big_discrepancy_women_and_minorities_in_low_paying_fields
Jensen Comment
I always advised my students that things other than starting salaries
were often more important. For example, in accounting the most important
factors are client exposure (clients often make the best offers to
auditors and consultants), the professional nature of interesting work,
and the amount and quality of the training are more important for the
long haul than starting salaries.
Advancement opportunities are also very important. Consideration
should also be given to travel demands (good news to some graduates and
bad news to other graduates) and pressures such as compensation based
upon sales commissions or other pressure cookers.
Also give consideration to the numbers of opportunities and the
locations of where those opportunities take place. Naval Architecture
and Marine Engineering graduates are paid well, but they are relatively
few in number and face only a limited number of job opportunities and
locales. One of my closest friends has a son who graduated as an
engineer from Maine Maritime Academy and received all sorts of
opportunities in the Merchant Marines. However, after recently getting
married the romance of being stationed aboard Far East merchant vessels
lost a lot of its appeal with his young and pretty wife living on a
horse farm in Conway, New Hampshire. If he'd instead become a N.H. CPA
he could probably have great opportunities in the Mt. Washington Valley
and live each day on the farm.
And in some cases health and pension plans can be very important. Any
career that provides a lifetime pension after only 20-30 years of
service provides a tremendous opportunity for double dipping later in
life. Consider running for the U.S. Congress where a short four-year
stint can get you a lifetime pension with great medical benefits for a
lifetime. Of course there's a lot of crap to wade through getting
nominated and elected.
To me the most important factor is independence and freedom of time
control such as those freedoms afforded to college professors. If I had
it to do all over again I would get a PhD in accounting (since
accounting PhDs are in such short supply for the tremendous needs of the
market). I guess in the 1960s I was the maggot that was dropped by a
soaring bird into the sweetest manure pile around.
http://www.jrhasselback.com/AtgDoctInfo.html
National Girls Collaborative Project (science, engineering, and math)
---
http://www.ngcproject.org/resources/newsletter.cfm
-
GirlGeeks ---
http://www.girlgeeks.org/
Career Options for Women (developed in Canada) ---
http://careeroptions.org/careeroptions/english_index.htm
"Deloitte Commits $60
Million in Pro Bono Services to Nonprofit Organizations: New
Pledge Totals $110 Million to Make Communities Stronger and Advance Key
Women/Girls, Education and Human Service Organizations," MarketWatch, April 6, 2012 ---
http://www.marketwatch.com/story/deloitte-commits-60-million-in-pro-bono-services-to-nonprofit-organizations-2012-04-06
Thank you Eliot Kamlet for the heads up.
"Say Anything: The Big Four Defense Of Overtime Exemptions,"
by Francine McKenna, re:TheAuditors, June 20, 2011 ---
http://retheauditors.com/2011/06/20/say-anything-the-big-4-defense-of-overtime-exemptions/
"PricewaterhouseCoopers Headed For A Trial In California Overtime
Case." by Francine McKenna, re:TheAuditors, June 17, 2011 ---
http://retheauditors.com/2011/06/17/pricewaterhousecoopers-headed-for-a-trial-in-california-overtime-case/
Jensen Comment
Francine discusses strategies used by large auditing firms to avoid
paying overtime, often in conflict with both state laws and auditing
standards. CPA firms are not unique in seeking out ways to avoid
overtime pay laws. Similar ploys are taken by hospitals and medical
clinics paying residents and universities paying adjunct faculty and
graduate students.
Career Guide to Industries -- Bureau of Labor
Statistics --- http://www.bls.gov/oco/cg/
Accountants and Auditors ---
http://www.bls.gov/oco/ocos001.htm
Free and fee CPA/CMA exam review
materials ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010303CPAExam
NASBA ---
http://en.wikipedia.org/wiki/Nasba
NASBA Video on How to Become a CPA ---
http://bit.ly/HowToBecomeACPA
FEI Second Life Video (thank you Edith)
---
If I Were an Auditor ---
http://www.youtube.com/user/feiblog#p/a/u/0/Q-FR_fkTFKY
Why the Big Four accounting firms are in the world's Top 5 student
picks for places to work (according to Bloomberg and
Business Week)
And why Google became the Number 1 choice
"Google Tops Grad Picks for Top Employers: The Big Four
accounting firms round out the top spots and Apple and GM make the list
for the first time in the latest Universum ranking by business
students," Business Week, September 28, 2010 ---
http://www.businessweek.com/bschools/content/sep2010/bs20100928_433243.htm?link_position=link1
Having captured the hearts and minds of
undergraduate business students, Google is still No. 1 in the latest
Universum ranking of the most popular employers rated by young
people. But it shouldn't get too cocky: The competition is getting
fiercer.
Google (GOOG), along with the Big Four
accounting firms—KPMG, Ernst & Young, PricewaterhouseCoopers, and
Deloitte—respectively make up the top five on the 2010 ranking
compiled by Universum, a research firm in Stockholm. The list is
based on the responses of more than 130,000 business and engineering
students in 12 major global markets who told Universum where they
dream of working.
The accounting firms fared well among
business students in the ranking because their training programs are
highly regarded and they have been on a hiring tear when jobs for
college grads have otherwise been difficult to come by. Google,
which took the top spot among both business and engineering
students, benefited from a unique corporate culture that includes
free food and haircuts and lets employees bring their dogs to work.
Kyle Ewing, talent and outreach programs manager for Google in
Mountain View, Calif., said in an interview that many are attracted
to the company because of its sense of mission.
"Google is a place where you can tackle big
problems," she said. "For all employees, there's a real sense that
people are working on things that could change the world."
Procter & Gamble (PG), Microsoft (MSFT),
Coca-Cola (KO), J.P. Morgan (JPM), and Goldman Sachs (GS)
respectively round out the top 10. Finance firms in the banking and
investing sectors, management consulting, and oil and gas companies
have become less appealing to students, according to the list.
Standouts during the economic crisis HSBC (HBC),
which ranked 22 in 2009, dropped out of the top 50 in 2010. And
Intel (INTC), Nokia (NOK), and ExxonMobil (XOM) fell out of the
upper 30 to the bottom of the list. Among companies new to the list,
Apple (AAPL), Bank of America (BAC), IKEA, and Adidas (ADS:GR) broke
into the top 30.
Universum asked students to select the five
employers for which they would most like to work from a list of more
than 120 that was based on Universum's 2009 top employers ranking.
Respondents could write in employers that were not on the list. A
company's ranking is based on the percentage of business students
who designated it among their top five. Of the top 50, eight are
Universum consulting clients.
Continued in article
Best Places to Intern ---
http://www.businessweek.com/managing/content/dec2009/ca2009129_394659.htm?link_position=link1
I'm waiting for Francine to throw cold water on the "ever
before" claim
Especially note the KPMG Experience Abroad module below
"Best Places to Intern: Bloomberg BusinessWeek's 2009 list shows
employers are hiring more interns to fill entry-level positions than
ever before," by Lindsey Gerdes, Business Week, December
10, 2009 ---
http://www.businessweek.com/managing/content/dec2009/ca2009129_394659.htm?link_position=link1
How valuable is a summer internship in a
recession? Consider
Goldman Sachs, the leading choice for
students interested in a career on Wall Street. This year, the
investment bank hired 600 fewer entry-level employees. That's not
surprising given the stunted economy and the government bailout of
banks. What is noteworthy is nearly 90% of Goldman's new hires were
former interns. The previous year, Goldman wasn't as concerned about
hiring a high percentage of students it had already invested time
and money to trainonly 58% of entry-level hires had spent a summer
at the company.
The same is true for other employers.
KPMG,
a Big Four accounting firm that
finds itself in tight competition with
Deloitte,
Ernst & Young, and
PricewaterhouseCoopers,
hired nearly 900
fewer entry-level employees this year. But 91% of those full-time
hires were former interns, whereas only 71% of new hires in 2008
were interns.
Internships have long been seen as a
primary recruiting tool at many top employers—a 10-week job tryout
to see who would be the best fit for full-time employment. But with
full-time hiring down, even the largest employers are trying to
maximize the investment they've made in interns by hiring a larger
percentage to fill entry-level position than ever before. "It's true
for all years, but I think it's even more so in years like this,"
says Sandra Hurse, a senior executive at Goldman who handles campus
recruiting.
Evaluating Employers
With
this ranking,
Bloomberg BusinessWeek
has put together its third annual guide to the best internships,
providing information on the number of interns each company
recruits, how many are offered full-time jobs, the number of interns
expected to be hired next year, even the salaries students
receive.To compile our list, we judged employers based on survey
data from 60 career services directors around the country and a
separate survey completed by each employer.We also consider how each
employer fared in the annual
Best Places to Launch a Career,
our
ranking of top U.S. entry-level employers released in September of
each year.
Our ranking of
the best U.S.companies for undergraduate internships
highlights employers who have put together an
outstanding experience for students.Accounting firm Deloitte tops
our list, followed by rivals KPMG (No.2) and Ernst & Young
(No.3).The last of the Big Four accounting companies,
PricewaterhouseCoopers, comes in at No.5, right behind consumer
goods giant
Procter & Gamble.
The employers on our list understand that
an outstanding internship experience is their most effective
recruiting tool to snap up the top entry-level job candidates.
That's why some companies have invested a considerable amount of
money in their programs.
Microsoft, for example, estimates it
spends on average $30,000 per intern, when you factor in pay and
benefits. Considering the company hired 542 undergraduate interns in
2009, that's roughly a $16 million investment.
Experience Abroad
Two years ago KPMG realized it had to make
a substantial investment in its internship program if it hoped to
woo top students from larger consulting and accounting firms. So the
company decided to offer interns an opportunity to gain valuable
overseas experience. KPMG lets student interns spend four weeks in
the U.S. and four weeks abroad. "It's extremely competitive [to
recruit top students], and this is a differentiator," says Blane
Ruschak, executive director of campus recruiting at KPMG.
A chance to work overseas is precisely what
appealed to Andrew Fedele, 21, an accounting and economics double
major at Pennsylvania State University. "I was sold pretty much when
I first read about [KPMG's] global internship program." He spent
four weeks in Chicago and four weeks in Johannesburg, South Africa.
"South Africa has just such an interesting history. To go there and
live with the locals and work with them was really exciting."
What did KPMG get in return? Exactly what
it hoped: Fedele accepted a full-time job almost immediately after
KPMG made its offer at the end of the summer.
Gerdes
is a staff editor for BusinessWeek
in New York.
"Ernst & Young: Named Top Employer In 2012 Stonewall Workplace
Equality Index," by Erica deVry, Big4.com, January 20, 2012
---
http://www.big4.com/ernst-young/eernst-young-named-top-employer-in-2012-stonewall-workplace-equality-index
The Stonewall Workplace Equality Index,
which showcases the UK’s top 100 public and private sector employers
for gay, lesbian, and bisexual staff, has named Ernst & Young
Employer of the Year for 2012, climbing from third place last year.
The firm also received top ranking in Stonewall’s inaugural ‘Global
Best Practice Index’.
Commenting on Stonewall’s recognition,
Harry Gaskell, Managing Partner for Advisory and Head of Diversity
and Inclusiveness at Ernst & Young said:
“Being named the 2012 Employer of the Year
is an achievement that we’re very proud of. I’m really happy with
the great progress the firm has made since it first entered the
Workplace Equality Index in 2005 and look forward to continuing to
champion diversity and inclusiveness in 2012.”
Ernst & Young’s leading role in developing
the concept of inclusive leadership, its sponsorship of National
Student Pride, its engagement with clients about sexual orientation
as a workplace issue, and strong leadership driven from the top are
some of the progressive initiatives attributed to the firm’s
success.
Continued in article
"Deloitte Given Perfect Rating on Human Rights Campaign Corporate Equality
Index," by Kalen Smith, Big4.com, January 13, 2012 ---
http://www.big4.com/uncategorized/deloitte-given-perfect-rating-on-human-rights-campaign-corporate-equality-index
The Human Rights Campaign has named Deloitte one of
the best places to work for the sixth year in a row. In their 2012 Corporate
Equality Index, the HRC noted that it gave Deloitte a 100 percent rating.
Deloitte chief talent officer, Jennifer Steinmann,
said that Deloitte is constantly working to provide a workplace that
employees will be proud of. Steinmann said that they offer a culture that
helps the LGBT community and encourages all of its employees to feel
accepted.
Steinmann said that Deloitte offers a number of
solutions to the variety of challenges they face as they strive to create an
environment that increases employee morale and gives all employees the
opportunity to thrive. Deloitte has used a number of Business Resource
Groups to educate employees and offer them the resources they need to
address the challenges they face in the workplace.
HRC is making its standards increasingly strict.
Due to the changes in their eligibility standards, about 50 percent of
companies have fallen off of the list. New standards include providing a
culture for members of the LGBT community and promoting company citizenship.
Steinmann and other representatives at Deloitte
state that they are proud of the fact that Deloitte has consistently earned
this recognition since 2006.
Continued in article
Bob Jensen's threads on the best places to work are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
"Avoiding MBA Internship Blunders," Business Week, June
21, 2012 ---
http://www.businessweek.com/articles/2012-06-21/avoiding-mba-internship-blunders
Seven internship goofs listed by Aida in Adelaide (not goofs in CPA
firms) ---
http://www.community.ichm.edu.au/s/226/images/editor_documents/Internship
News 22-02-08.pdf
1. BEING A WALLFLOWER
Shy and quiet interns are at a definite
disadvantage, says Roger Conner, Vice- President of Communications
at Marriott International. "They may be quite intelligent, but it
does not reflect well on them." Good interpersonal skills, such as
making good eye contact, are extremely important, he says. Put those
skills to use, and take advantage of company-wide events to get some
face time with higher management. Those in higher positions are
often more than willing to share their advice with interns, when
asked. "Maybe they can spare the 30 minutes on their calendars, and
maybe they can't -- but it doesn't hurt to try."
2. DUCKING THE EXTRACURRICULARS
Most companies make an effort to arrange informal
events and outings such as football games or community service days
-- sometimes for a whole department, sometimes just for interns. By
not participating you might actually be sending the message that you
don't understand the company's values. You'll also lose out on what
may be the best opportunities to get to know your co-workers on a
more personal level.
3. GRUNTING ABOUT GRUNT WORK
Whether it's making photocopies or polishing
cutlery, menial duties are a fact of life in every job role. Getting
on with those small tasks will make any department run smoother and
will stand you in good stead with your manager, who’ll be impressed
by your willingness to help out.
4. MISSING THE BIG PICTURE
Spending as much time as you can with as many people
as you can is the best way to learn about the company you're working
for. Don't be afraid to venture outside your immediate team or
department to learn how your responsibilities fit into the big
picture.
5. FAILING TO ASK QUESTIONS
Asking questions can be
crucial to avoid wasting time and energy by approaching problems in
the wrong way. They can also speak volumes about your desire to
learn. There's perhaps no better way to show off your intellectual
curiosity than by asking intelligent questions. It's the rare person
in any organisation who knows everything.
6. REJECTING CRITICISM
Critical feedback is the most
challenging to give and receive -- but it's also the most useful.
That means it's smart for interns to seek out constructive
criticism, rather than waiting for a formal review.
Some students, particularly
confident ones in the classroom, may not be as open to criticism as
they should be. Instead of really listening to feedback, a number of
interns simply shut it out. Overly cocky interns aren't just making
a bad impression; they're also missing out on valuable opportunities
to improve their skills.
7. WASTING TIME
Recruiters consistently cite being proactive as one of the most
important qualities in a successful intern. If you're waiting to be
told what to do you're not doing enough. 6 months is short, and
there's a lot you can learn by asking for new tasks.
Jensen Comment
Probably the best advice to consider is that given by the firm's
employee who interviewed you for the internship. And pay particular
attention to your accounting professors --- they're always right.
Seriously, the professor who has previously monitored a lot of
interns probably has heard it all. That professor can probably highlight
the big plus things to do on and internship as well as the minus things.
One of the toughest internship settings requires tolerance with
dignity. One time I ended up with a house guest at a Comedy Club on the
San Antonio River Walk. The show turned especially gross, and my friend
and I soon walked out. I felt sorry for the 23 Ernst & Young employees
and interns who were sitting alongside of us at the same show. Should
you, as an intern, have walked out of the show leaving your 22
colleagues behind? I really don't know what to advise in these
circumstances. I honestly think the E&Y local office employees, like us,
did not really expect that Comedy Club show to become so gross. On the
other hand, perhaps street smart people should always expect the worst
from a Comedy Club.
And if the internship goes badly, the blame may not all fall on the
intern. Sometimes employees dealing with interns are under stress and
not at their best during a particular internship period. Do report any
really bad stuff like sexual harassment and failure to deliver on what
was promised to you in this internship. And do own up to your own
mistakes. To err is human on the job. To cover it up or blame somebody
else is generally stupid.
And remember things that seem cool among other students are not
always cool on the job --- including those brass boogers sticking out
the side of your nose, lip, or tongue and those edges of tattoos that
peek out from your clothing.
Don't pretend to be a great intellectual by tossing out quotes from
renowned scholars. Instead be able to discuss possible batting averages,
injury, and e.r.a. reasons that the Red Sox are at the bottom of their
division. Know the names of the top money winners in recent P.G.A. and
L.P.G.A. tournaments.
Be polite everybody equally and don't be overly patronizing to women
and minorities. If a particular woman makes a feminist joke or a black
makes a watermelon joke this does not mean you are entitled to make the
same types of jokes --- but jokes about Ole, Lena, Sven, and Swedes in
general are commendable in any setting.
And remember that interns sometimes are treated differently than
full-time employees. Be prepared for questions such as those shown
below:
- What is your all-time favorite book?
- What are the best three books you ever read? (don't overlook the
autobiography of the founder of the company or university)
- If you could've had an intimate differ with three people, living or dead
who would you choose and why? (this demands creative thought)
- Who was your favorite K-12 teacher and why?
- Who was your favorite athletic coach and why?
- Who was your was your favorite college professor and why?
- Who was your least favorite college professor and why?
- Who is your favorite active in an academic blog and why?
- Who is your favorite active in a non-academic blog and why?
- Who is your favorite blogger in the NYT, the WSJ, the New Yorker,
the Economist, MSNBC, CNBC, the Nation, and on and on and on?
- If you have online debates, who is your favorite antagonist and why?
- If you have online debates, who is your favorite protagonist and why?
- Who is your favorite intellectual progressive?
- Who is your favorite intellectual conservative?
Sometimes such questions are just ways of making conversation with strangers.
At other times they are trick questions to see if you tend to pretend to be
somebody that you're really not or somebody who is slow to think and speak
extemporaneously. Of course if you prepare for the above questions it's not
exactly extemporaneous.
Accounting Doctoral Programs
PQ = Professionally Qualified under AACSB standards
AQ = Academically Qualified under AACSB standards
May 3, 2011 message to Barry Rice from Bob Jensen
Hi Barry,
Faculty without doctoral degrees who meet the AACSB PQ standards
are still pretty much second class citizens and will find the tenure
track hurdles to eventual full professorship very difficult except
in colleges that pay poorly at all levels.
There are a number of alternatives for a CPA/CMA looking into
AACSB AQ alternatives in in accounting in North American
universities:
The best alternative is to enter into a traditional accounting
doctoral program at an AACSB university. Virtually all of these in
North America are accountics doctoral programs requiring 4-6 years
of full time onsite study and research beyond the masters degree.
The good news is that these programs generally have free tuition,
room, and board allowances. The bad news is that students who have
little interest in becoming mathematicians and statisticians and
social scientists need not apply ---
http://faculty.trinity.edu/rjensen/Theory01.htm#DoctoralPrograms
As a second alternative Central Florida University has an onsite
doctoral program that is stronger in the accounting and lighter in
the accountics. Kennesaw State University has a three-year executive
DBA program that has quant-lite alternatives, but this is only
available in accounting to older executives who enter with
PQ-accounting qualifications. It also costs nearly $100,000 plus
room and board even for Georgia residents. The DBA is also not
likely to get the graduate into a R1 research university tenure
track.
As a third alternative there are now some online accounting
doctoral programs that are quant-lite and only take three years, but
these diplomas aren't worth the paper they're written on ---
http://faculty.trinity.edu/rjensen/Crossborder.htm#CommercialPrograms
Cappella University is a very good online university, but its online
accounting doctoral program is nothing more than a glorified online
MBA degree that has, to my knowledge, no known accounting
researchers teaching in the program. Capella will not reveal its
doctoral program faculty to prospective students. I don't think the
North American academic job market yet recognizes Capella-type and
Nova-type doctorates except in universities that would probably
accept the graduates as PQ faculty without a doctorate.
As a fourth alternative there are some of the executive
accounting doctoral programs in Europe, especially England, that
really don't count for much in the North American job market.
As a fifth alternative, a student can get a three-year
non-accounting PhD degree from a quality doctoral program such as an
economics or computer science PhD from any of the 100+ top flagship
state/provincial universities in North America. Then if the student
also has PQ credentials to teach in an accounting program, the PhD
graduate can enroll in an accounting part-time "Bridge Program"
anointed by the AACSB ---
http://www.aacsb.edu/conferences_seminars/seminars/bp.asp
As a sixth alternative, a student can get a three-year law degree
in addition to getting PQ credentials in some areas where lawyers
often get into accounting program tenure tracks. The most common
specialty for lawyers is tax accounting. Some accounting departments
also teach business law and ethics using lawyers.
Hope this helps.
Bob Jensen
PS
Case Western has a very respected accounting history track in its
PhD program, but I'm not certain how many of the accountics hurdles
are relaxed except at the dissertation stage.
What I like about Gina's site is that it does not avoid programs in
major colleges and universities.
August 8, 2011 message from Gina
Hi Bob Jensen,
I maintain
http://www.lawenforcementtraining.org.
I have spent many
years as a law enforcement officer, and love my field of work. I
decided to
make a website to help up and coming law enforcement students
explore
schools that offer this degree degree. Do you mind taking a look and
adding
it to your resource page of :
http://www.trinity.edu/rjensen/fraud.htm ?
http://www.lawenforcementtraining.org
has become a fun passion
project of mine, and I think it serves as a great resource for
anyone looking
to get a degree and start a career in law enforcement. I would
greatly
appreciate any feedback, and hope you will find it as a useful
addition to your
site.
Thanks for taking a look!
Gina
Bob Jensen's threads on careers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Bob Jensen's threads on online training and education alternatives
---
http://faculty.trinity.edu/rjensen/Crossborder.htm
"For Female Faculty, a B-School Glass Ceiling: Work-life issues,
lack of mentorship programs, and sexual discrimination are preventing many women
from obtaining tenure and full professorships," by Allison Damast, Business Week, August 8, 2011 ---
http://www.businessweek.com/business-schools/for-female-faculty-a-bschool-glass-ceiling-08082011.html
Bob Jensen's threads on the Glass
Ceiling (and in some cases lack thereof in CPA firms) are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#careers
"College Majors, Unemployment and Earnings: Not all college
degrees are created equal," Georgetown Center on Education and the
Workforce, Date unknown but assumed to be late in 2011 ---
http://www9.georgetown.edu/grad/gppi/hpi/cew/pdfs/Unemployment.Final.update1.pdf
Jensen Comments
Not many surprises here although numbers are given for "earnings" and
"unemployment." Engineering comes out ahead in broad categories. But I
often think these outcomes can be misleading in the sense that
"business, finance, and accounting" sometimes facilitate promotions to
executive suites. For example, a lowly paid entry level IRS agent who
works successfully up the promotion latter in government can sometimes
jump over to the private sector at very high salary levels and benefits.
Similarly, audit partners commonly cross over to clients at high paid
CFO or CAO executive positions.
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
WhyCTE: Career Technical Education ---
http://whycte.org/
Job and Career Search Helper Site
O*Net OnLine ---
http://www.onetonline.org/
"Banks Favor Companies with Women CFOs? A female finance chief may
be an asset when pitching for bank loans, a new Rensselaer Polytechnic
Institute study suggests," by Marielle Segarra, CFO.com,
December 22, 2011 ---
http://www3.cfo.com/article/2011/12/leadership_rensselaer-polytechnic-rpi-qiang-wu-bank-loans-gender
GirlGeeks --- http://www.girlgeeks.org/
-
2012 Working Mother: 100 Best Companies ---
http://www.workingmother.com/best-company-list/129110
"Deloitte Commits $60
Million in Pro Bono Services to Nonprofit Organizations: New
Pledge Totals $110 Million to Make Communities Stronger and Advance Key
Women/Girls, Education and Human Service Organizations," MarketWatch, April 6, 2012 ---
http://www.marketwatch.com/story/deloitte-commits-60-million-in-pro-bono-services-to-nonprofit-organizations-2012-04-06
Thank you Eliot Kamlet for the heads up.
Question
Who was the first woman to be admitted as an audit partner in a Big
Eight accounting firm?
Indiana University's Photo Archives (over two million pictures)
---
http://paper.li/businessschools?utm_source=subscription&utm_medium=email&utm_campaign=paper_sub
Jensen Comment
I did a search on the term "Accounting." One hit was a 1936 photograph
of an "accounting machine room" that in some respects resembles a
computing lab room of modern times. I don't know why an "auto polo" site
also showed up on the hit list for accounting. That photograph mentions
Ernie Pyle, although I'm wasn't sure this is the famous Ernie Pyle.
However, a check on Ernie Pyle showed at he was at Indiana University at
that time ---
http://en.wikipedia.org/wiki/Ernie_Pyle
It was slightly more productive to search on the word "Business".
Here's a 1957 photograph of a computing machine in the school of
business ---
http://webapp1.dlib.indiana.edu/archivesphotos/results/item.do?itemId=P0023310&searchId=3&searchResultIndex=21
Various photographs of Michele Fratianni (economics professor) show
how men can truly disguise their appearances with glasses and a
mustache. I wonder if the nose was attached to the glasses.
Cartoon: Players may strut and players may fret but orators
rave on forever ---
http://webapp1.dlib.indiana.edu/archivesphotos/results/item.do?itemId=P0022845&searchId=0&searchResultIndex=52
Here's a 1945 Careers for Women photograph ---
http://webapp1.dlib.indiana.edu/archivesphotos/results/item.do?itemId=P0023302&searchId=2&searchResultIndex=20
It would be interesting to investigate what female career opportunities
were being promoted at the time by Indiana University. It was in some
ways too early to suggest CPA firm careers. Most of the large CPA firms
were not yet admitting women partners (at least not in any significant
numbers), and women were not usually allowed to travel on audits and
meet with clients. How times have changed now that CPA firms hire more
women graduates than men in recent years.
In 1960 Mary Jo McCann became the first woman CPA in Kansas ---
http://www.kscpa.org/about/news/119-mary_jo_mccann_first_woman_cpa_in_kansas_passes
Fifteen years later she became Chair of the Kansas State Board of
Accountancy
In 1977 Cheryl Wilson became the first woman partner of any Big
Eight firm in Chicago (Coopers & Lybrand) ---
http://www.icpas.org/hc-media.aspx?id=7602
In the1960s Mary E. Lanigar, a Stanford University
mathematics graduate and attorney and CPA, was the arguably first
U.S. female to be made partner in any Big Eight firm (Arthur Young).
She was a tax partner. In 1938 she'd worked as an accountant in the
Stanford University Athletics Department.
http://articles.sfgate.com/2007-10-24/news/17264444_1_mills-college-santa-rosa-mary
In 1973 Marianne Burge became the first Price Waterhouse female
partner. She was also a tax partner.
http://www.nytimes.com/1998/03/17/business/marianne-burge-64-expert-on-tax-issues.html
Ernst & Ernst acquired a woman partner in 1957, but I think she
was inherited as a partner in a merger with a British accounting
firm (Whinney, Murray, & Company) ---
http://www.spoke.com/info/p73cjmW/Aalso
It would be interesting to know when the first U.S. female audit
partner was admitted in a Big Eight firm.
I suspect that Dale Flesher (Ole Miss. expert on accounting history)
probably knows the answer to this one.
Profitability: Based on 300,000 companies, most with annual
sales under $10 million. One takeaway: Specialization pays off
What a great Rank 1 slide for college recruitment of accounting
majors ---
http://www.forbes.com/2010/04/15/most-profitable-small-businesses-entrepreneurs-finance-sageworks_slide_21.html
The most profitable niche of the bunch (CPA
bunch) enjoys a nice mix of pricing power (everybody needs
accountants, no matter how the economy is doing), low overhead and
marketing scale, thanks to plenty of repeat clients.
Other Accounting Services comes it at Rank 3 ---
http://www.forbes.com/2010/04/15/most-profitable-small-businesses-entrepreneurs-finance-sageworks_slide_19.html
Various accounting, bookkeeping, billing
and tax preparation services in any form, handled not necessarily by
a Certified Public Accountant (see No. 1 on our list).
And at Rank 5 are Tax Preparation Services (one rank below dentist
offices) ---
http://www.forbes.com/2010/04/15/most-profitable-small-businesses-entrepreneurs-finance-sageworks_slide_17.html
Who likes doing their taxes? Exactly.
"The Most Profitable Small Businesses," by Brett Nelson and
Maureen Farrell, Forbes, April 15, 2010 ---
http://www.forbes.com/2010/04/15/most-profitable-small-businesses-entrepreneurs-finance-sageworks.html?boxes=entrepreneurschannelinentre
The 20 Most Profitable Slide Show (The top line has a Next button)
---
http://www.forbes.com/2010/04/15/most-profitable-small-businesses-entrepreneurs-finance-sageworks_slide.html
"Deloitte Touche plans hiring spree," by Alan Rappeport,
Financial Times, September 13, 2010 ---
http://www.ft.com/cms/s/0/0907aa9c-bf03-11df-a789-00144feab49a.html?ftcamp=rss
Deloitte Touche Tohmatsu, the global
accounting firm, said on Monday that it would hire an average of
50,000 workers a year during the next five years as it revealed
strong revenues.
Revenues at Deloitte rose by 1.8 per cent
to $26.6bn in the fiscal year ending May 31 on the strength of its
consulting business and growing demand for its services in Asia.
Deloitte, which is one of the “big four”
accounting firms, has been helped by the greater regulatory scrutiny
that companies are facing along with the need to streamline their
businesses in the wake of the downturn.
Consulting revenues at Deloitte rose by
14.9 per cent to $7.5bn last year. That helped the company absorb
weaker revenue in its financial services advisory unit and its audit
business, which Deloitte attributed to reductions in its hourly
rates.
Deloitte’s consulting business was lifted
by the
acquisition of BearingPoint’s US public sector consulting practice
and greater demand from businesses that needed
help integrating new technology.
“I am proud of our people and their
continued commitment to client service excellence during the most
difficult economic climate in decades,” Jim Quigley, Deloitte’s
chief executive, said in a statement.
Audit revenues declined by 1 per cent and
financial advisory revenues were off by 2 per cent.
Deloitte employs 170,000 people worldwide
and said on Monday that it expects to add 250,000 new workers during
the next five years as it looks to expand its services and
geographic reach.
Regionally, Deloitte had the strongest
growth in Asia, where revenues were up by 8.5 per cent to $3.6bn.
Revenues were up by nearly 4 per cent to $13bn in the Americas,
thanks to increased demand in Brazil, but dipped in Europe, the
Middle East and Africa.
In the US, accounting and audit firms have
been under scrutiny in the aftermath of Bernard Madoff’s “Ponzi”
scheme for failing to catch irregularities related to his
investments. In the UK, the Financial Reporting Council is
investigating conflicts of interest between firms that provide both
accounting and audit services to clients.
Advice and Bibliography for Accounting Ph.D. Students and New Faculty by
James Martin ---
http://maaw.info/AdviceforAccountingPhDstudentsMain.htm
"So you want to get a Ph.D.?" by David Wood, BYU ---
http://www.byuaccounting.net/mediawiki/index.php?title=So_you_want_to_get_a_Ph.D.%3F
Why accountancy doctoral programs are drying up and why
accountancy is no longer
required for admission or graduation in an accountancy doctoral program
---
http://faculty.trinity.edu/rjensen/Theory01.htm#DoctoralPrograms
Bob Jensen's threads on what went wrong with "accountics research" can be
found at
http://faculty.trinity.edu/rjensen/theory01.htm#WhatWentWrong
From the AICPA
Overview of Certified in Financial Forensics (CFF) Credential ---
Click Here
http://www.aicpa.org/InterestAreas/ForensicAndValuation/Membership/Pages/Overview
Certified in Financial Forensics Credential.aspx
Business School Zone ---
http://www.businessschoolzone.com/
A Degree in Management ---
http://www.managementdegreezone.com/
How will IFRS affect the 2011 CPA Examinations?
If I Pass CPA Exam Parts in 2010, Will I Have to Pass Them Again in
2011?
Click Here
http://goingconcern.com/2010/06/if-i-pass-cpa-exam-parts-in-2010-will-i-have-to-pass-them-again-in-2011/#more-12870
NASBA ---
http://en.wikipedia.org/wiki/Nasba
NASBA Video on How to Become a CPA ---
http://bit.ly/HowToBecomeACPA
Bob Jensen's threads on the CPA examination are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010303CPAExam
An Upbeat Accounting Recruitment Message in a Down Economy
December 10, 2009 reply from David Fordham, James Madison University
[fordhadr@JMU.EDU]
Francine, Ed, Bob, et al:
Also completely anecdotal but on the other
side of the coin:
I have no knowledge or evidence about audit
fees, firm profits, or even demand for audit services, since I've
been way too busy to spend time with recruiters this semester. But
based on what my colleagues are telling me, the cold air has not
seeped down to us yet.
We had more firms at our "meet the firms"
night last month than we've ever had before (56). The number of
organizations who recruited accounting majors here set a new school
record (66). Our percentage of May grads who have job offers already
(74%)is exactly the same as it was this time last year, which was up
about 5% before the year before and up 8% from the year before. The
actual COUNT of grads who are graduating and who have jobs is up
about 5% over last year. We haven't yet run our salary survey (to my
knowledge) but from the scuttlebutt in talking with students, the
starting salaries for our grads haven't dropped noticeably, if at
all. I still have firms calling me begging to be guest speakers for
my classes, which means they apparently still have time to spend a
day driving over here to class, and still have money enough to spend
the night and go to a basketball game or something.
We graduate around 120 accounting BBA's per
year, and about 75-80 MSA grads each year (almost all of whom were
accounting BBA's the year before). The bachelor number has been
relatively steady the past few years, but the MSA enrollment has
quadrupled over the last 3-4 years as the Virginia 150-hr kicked in
a couple years ago.
Regarding curriculum, we too have moved
several courses from the undergrad to the grad level, and our
undergrad accounting degree no longer has sufficient accounting
hours to meet the 30-hour minimum to sit for the exam in Virginia.
Students not going for the MSA have to add the CIS minor to get
their 150 hours -- and that minor includes an accounting technology
course which puts them over the 30-hour accounting hurdle. But those
who can get in (minimum GPA, GMAT hurdles, etc.) all go into the
Masters program.
The masters program not only has some
accounting courses that used to be undergrad, it also has the
original pioneering Becker Boot-Camp (totally non-credit) starting
the week after graduation. With the Becker boot camp, we are now in
the top ten first-time pass-rates on the Exam. Since practically all
our MSA's go into public accounting, the arrangement has been a boon
to the students. Practically all of them have the course paid for by
their employer after passing the exam.
Again, we are probably not typical. The
only way we know the economy is down is that our salaries remain
frozen after several years, our travel was frozen and while unfrozen
now, remains under heavy restrictions, and my computer is now more
than five years old. Fortunately, donations are up, so I still plan
to be at the AAA-IS next month.
Of course, I have to admit, about 2/3rds of
our market is Big Four in the Washington/Baltimore area which may be
totally atypical to the rest of the world. But most (>90%) of our
grads start in public accounting (Big 4, second tier, and a
sprinkling of smaller firms), with almost all of the remainder going
to government (the GAO, Secret Service, DoD, and Dept of Justice all
have more offers out to our students this year than last, and are
far more aggressive about trying to get their reps in front of the
students than they have ever been in the past).
Purely anecdotal, and quite likely
atypical, but from our unusual vantage point, accounting is still
strong. We have no shortage of students wanting to major in
accounting. Because we remain under a hiring freeze, we have had to
manage enrollments by increasing our minnimum GPA to declare the
major, and are implementing an entrance exam to enroll in
intermediate.
David Fordham
James Madison University
Accounting Majors in Demand
Even when the economy is down, there is room
for top students in the profession. The National Association
of Colleges and Employers’ 2009 Student Survey found that, even though
students in the class of 2009 were graduating with fewer jobs available,
accounting majors are still in high demand. Accounting and engineering
graduates were among those majors most likely to have already found
jobs. Accounting majors expect to earn an average starting
salary of about $45,000, while engineering grads expect to earn $58,000.
Journal of Accountancy, July 2009 ---
http://www.journalofaccountancy.com/Issues/2009/Jul/AccountingMajors.htm
December 9, 2009 message from Francine
McKenna [retheauditors@GMAIL.COM]
Unfortunately Bob,
the public accounting firms are hiring less and less right now. And
they are also cutting professionals at all levels, including those
who have less than 2 years of experience and don't even have a CPA
yet.
We may be stuck with
the 150 hour requirement but we are not stuck with the way the audit
firms and the schools look at how that requirement is going to be
met. Are we sure the firms and other employers are still expecting
the same things form the universities given this requirement and the
challenges it presents for students?
Thanks to Linda, Amy, and Bob for
input.
http://goingconcern.com/2009/12/are-new-graduates-getting-sque.php
Francene
December 10, 2009 reply from Bob Jensen
Hi
Francine,
Firstly
I don’t think the CPA firm employment outlook is all that bad unless
the Supreme Court strikes down
Sarbanes-Oxley (SOX) and the
PCAOB. Perhaps the big firms are cutting back only temporarily
in fear of losing SOX. Losing SOX at this point in time would
be a disaster for auditing in general since the loss of audit fees
might well push firms over the brink where auditing profits are no
longer sufficient to off set the risk of billion dollar lawsuits.
Until
Wall Street managed to get SOX in front of the Supreme Court, the
outlook for accounting graduates was much better than all other
business school disciplines. There were other bright spots.
-
-
Accounting Majors in Demand
Even when the economy is down,
there is room for top students in the profession. The
National Association of Colleges and Employers’ 2009 Student
Survey found that, even though students in the class of 2009
were graduating with fewer jobs available, accounting majors
are still in high demand. Accounting and engineering
graduates were among those majors most likely to have
already found jobs. Accounting majors expect to earn an
average starting salary of about $45,000, while engineering
grads expect to earn $58,000.
Journal of Accountancy, July 2009 ---
http://www.journalofaccountancy.com/Issues/2009/Jul/AccountingMajors.htm
- Robert Half Survey Update ---
http://www.rhi.com/GFEM
"Employment outlook grim in 2009, but not for
accountants," AccountingWeb, January 15, 2009 ---
http://www.accountingweb.com/item/106818
"Global
Employment Financial Monitor for 2009-2010" (free
download from Robert Half) ---
http://www.rhi.com/GFEM
Executive Summary
The accounting and finance professions have not been
immune to the effects of the global financial crisis.
Two-thirds of hiring managers we surveyed said their
accounting and finance departments have been affected by
current economic conditions.
Yet, for many employers, good
accountants are still hard to find.
More than half of all respondents
said they were having difficulty locating skilled job
candidates, and financial professionals remain in short
supply in parts of the world.
Even where job candidates compete for relatively few
open positions, many managers are concerned about losing
their most valuable team members to other job
opportunities.
As
positions are consolidated and fewer new employees
added, financial professionals are taking on more work
and experiencing increased stress. In response, managers
are taking steps to help their employees remain
motivated and productive, survey results show.
The hiring
process is taking longer today, in part due to budget
constraints but also because companies feel they can be
more selective. When hiring at the executive level,
businesses seek leaders with the industry experience and
initiative necessary to seize any possible competitive
edge.
Manpower Survey Guide Issue 75 ---
http://www.accountingweb.com/item/96782
The small
business outlook is indeed grim and that reverberates to accounting
firm business and employment needs, but there are signs that the
Obama Administration may pull out the stops to boost the small
business economy. But don't hold your breath for success of a small
business surge --- http://www.accountingweb.com/item/95831
In my
estimation, hiring of entry level graduates will surge ahead unless
the Supreme Court destroys the entire auditing profession.
Bob
Jensen
Question
What's the most fun when you're on the road Tom Selling (even if your
not exactly a "tax man")?
Answer Choices
- The billings
- The expense reimbursements
- The tax deductions
- The difference between the amounts in Answers 2 and 3 above
"A Tax Man Takes Account Of His Life CPA Lives Better, Works Less
Thanks to Art of Deduction," by Laura Saunders, The Wall Street
Journal, April 5, 2011 ---
http://online.wsj.com/article/SB10001424052748703696704576222590253291266.html?mod=WSJ_PersonalFinance_PF4
In the thick of tax season, most certified
public accountants are chained to their desks grinding out returns.
Doug Stives, a CPA from Red Bank, N.J.,
went skiing in Utah.
"I always dreamed of coming here for peak
conditions," he said in mid-March between runs at Snowbasin Resort.
The trip is among the many perks that have
accrued from his decision, in 2006, to become, in effect, The Most
Tax-Efficient Man in America. The experiment has led to a new
career, frequent travel and obsessive documentation of expenses,
such as a $6 hot dog he recently bought in the Philadelphia airport.
The "aha" moment came to him, he says,
after a college approached him about a teaching gig and he realized
he could put into practice many of the tax strategies he had learned
over the decades.
Step One was to change jobs. Mr. Stives had
been a partner for 36 years at The Curchin Group, an accounting
firm. By accepting an offer to teach tax and accounting courses
full-time at the Leon Hess Business School of Monmouth University in
New Jersey, he was able to tap into a broad array of tax-free
employee benefits not available to him at the firm.
Step Two was the formation of Doug Stives
LLC, the separate consulting business to which he attributes an
impressive array of expenses. In general, people who are employees
and have side businesses are often in the best position to maximize
the tax code's benefits, say experts. Mr. Stives calls this "the
best of all worlds."
The result, says Mr. Stives, is that while
he earns less than 75% of his earlier pay, he takes home almost 90%
as much. And he says he reaps another $40,000 a year in tax-free
benefits from his college gig. Among other things, the school adds
to his 401(k) contribution and provides tax-free, discounted health
plans for Mr. Stives and his wife, plus disability insurance. As a
partner in the accounting firm, he had to fund such expenses
himself.
Not that all is perfect now. One peeve:
dealing with what he calls "airline nonsense"—long lines, rising
fees and canceled flights. But overall, he says, "my quality of life
is so much higher."
His wife of 40 years, Elizabeth Stives,
agrees. "We travel so much now for his business," she says. "Next is
Lake Tahoe."
Continued in article
Jensen Comment
Tom is probably not the best person to ask about this since I don't
think he takes his wife on most of his many trips. However, back when I
was consulting and/or making presentations all over the U.S., Canada,
Mexico, Europe, sometimes New Zealand and Asia I typically took my wife
along for our expense-paid and/or tax-deductable holidays ---
http://faculty.trinity.edu/rjensen/Resume.htm#Presentations
I think I enjoyed these "holidays" more because they were tax
deductible or they earned me a profit after expenses. I don't recall
many away-from home adventures that were strictly out-of-pocket.
Mathematics Careers ---
http://www.maa.org/careers/
Free PSAT Practice Exams ---
http://www.testpreppractice.net/PSAT/Default.aspx
"SAT Prep on the Web: : A) a Game; B) Online Chat; C) All of the
Above," by Katherine Boehret, The Wall Street Journal,
November 3, 2010 ---
http://online.wsj.com/article/SB10001424052748704462704575590383273883818.html
This Saturday, high-school students around
the country will sit for hours of silent testing that will determine
some portion of their future: That's right, it's SAT time. For both
parents and kids, the preparation for taking the standardized test
is stressful and expensive, often involving hours of studying and
several hundreds of dollars spent on classes, workbooks and tutors.
And many kids will take these tests more than once.
So this week I tried a Web-based form of
test prep called Grockit that aims to make studying for the SAT,
ACT, GMAT, GRE or LSAT less expensive and more enjoyable.
Grockit.com offers lessons, group study and solo practice, and does
a nice job of feeling fun and educational, which isn't an easy
combination to pull off.
A free portion of the site includes group
study with a variety of questions and a limited number of solo test
questions, which are customized to each student's study needs. The
$100 Premium subscription includes full access to the online
platform with unlimited solo practice questions and personalized
performance analytics that track a student's progress. A new
offering called Grockit TV (grockit.com/tv) offers free eight-week
courses if students watch them streaming live twice a week.
Otherwise, a course can be downloaded for $100 during the course or
$150 afterward. Instructors hailing from the Princeton Review and
Kaplan, among other places, teach test preparation for the GMAT
business-school admissions test and SAT.
For the sake of testing, I focused on the
SAT and plunged back into the depths of reading, writing and (gulp)
math to get a sense of what students see and do on Grockit.com. In a
short period of time, I found myself wanting to go back to the site
to get better at certain sections or to earn more Experience Points,
which result in badges and unlock new levels of study, both of which
can be optionally posted to outside networks like Facebook or
Twitter. By default, everyone can see one another's points, which
invites healthy competition; these can also be hidden if you'd
rather keep them private.
I tested both the free version of
Grockit.com, which includes an SAT writing diagnostic test, and the
extra offerings of a $100 Premium account, including diagnostic
tests for writing, reading and math to evaluate my strengths and
weaknesses in taking the SAT. The free version had too many messages
that constantly notified me of what I could do with a paid account
and prompted me to upgrade.
Along with completing practice questions
with strangers and instructors, I got a friend of mine to also use
Grockit.com so we could compete together in Grockit's Speed
Challenge Games. These are included in the free portion and they
reward the fastest person who answers a question correctly—but also
display incorrect guesses, thus narrowing the possible answers for
those who don't answer first. It was more fun for me to play against
someone I knew, but I can imagine kids preferring the anonymity of
competing with strangers when they don't answer questions correctly.
In an introductory video, Grockit founder
and chief product officer Farb Nivi describes the site by saying,
"It's like having a complete multimedia textbook and workbook
online, at your fingertips." But for kids (and from my experience,
adults), the computer isn't an easy place to concentrate. On any
given PC, especially one used by a teenager, instant-message
indicators are chiming, Facebook updates and Twitter tweets are
waiting to be checked, music is playing in the background and emails
are flowing into inboxes. Plus, the Grockit site is just a tab away
from other websites and distractions. And the site has no way of
working in a distraction-free mode, like how the new Microsoft
Office for Mac offers Full Screen View, which quiets any alerts or
pop-up distractions.
It also isn't necessarily comfortable for
students to read extensive text (like in reading questions for the
SAT) on a vertical computer screen. The site will run on the iPad,
which can be held on a lap for more comfortable reading, but many
students don't own one of these.
Part of the way Grockit is made more fun is
by purposely incorporating social networking into the experience. As
people work on questions, they can instant message with one another
in a right-side panel about tips for answering questions or simply
for commiserating about studying. These IMs don't make indicator
sounds, so they aren't too intrusive, but they can't be fully
closed. I saw several chats among teens about nothing in particular,
as well as some test-taking tips from instructors and other
students.
Grockit encourages users to "be nice" in
chats because all conversations are logged; people can also flag one
another for offensive remarks. Chats are also archived on your page
so you can reread them for tips and study hints. If you find
someone's tip helpful or if you simply like a person, you can award
him or her with Grockit Points, which show up beside a name and
profile photo. Users' ages or last names aren't displayed.
Grockit offers one-on-one tutoring for a
fee of $50 an hour, and I tried one session for math. My instructor
and I used Skype to audio chat throughout the session and he took
advantage of a whiteboard in Grockit, where he could write out the
steps in an algebra problem to demonstrate how to solve for X.
Around 40 instructors are employed for
Grockit, but anyone can run a practice session, even other students.
I signed up for a scheduled practice session at 8 p.m. that I
assumed was run by an instructor, and later found out it was run by
a student. Grockit instructors can also pop into sessions at any
given time to help students, and one did during my session. Grockit
works on a system of transparency so users can evaluate all
teachers. My tutor had five-star rating and did a great job
reminding me of algebra rules.
If you're looking for an inexpensive and
more enjoyable way to study for big tests, Grockit is a viable and
easily accessible option. But its proximity to the rest of the Web
could prove much more distracting than the old SAT workbook.
—See a video with Katherine Boehret on
Web-based test-prep software at WSJ.com/PersonalTech.
Email her at
mossbergsolution@wsj.com
Bob Jensen's threads on edutainment are at
http://faculty.trinity.edu/rjensen/000aaa/thetools.htm#Edutainment
GRE Exam Prep on the Web
http://www.greguide.com/
http://www.greguide.com/gre-practice-tests.html
Hot Academic Jobs of the Future
Note that due to shortage of supply of PhD accountants, newly-hired
accounting PhDs are generally among the highest paid faculty in their
ranks such as newly hired assistant professors of accounting now being
paid well over $120,000 for nine-month contracts in major universities.
In most instances accounting assistant professors get significantly
higher offers than their counterparts in science, humanities, and
engineering. They may not do much better than new hires in law schools.
Medical schools have such complicated ways of paying faculty, that
comparisons of salaries of medical schools with all other disciplines in
a university are virtually impossible. For example, medical faculty
sometimes get bonuses for clinical services in university hospitals.
A June/July 2009 AACSB report says the shortage of accounting PhDs is
getting worse instead of better, particularly as the supply of new PhD
graduates in accounting declines while demand for accounting faculty
explodes (accounting is probably the only business discipline where
demand for graduates has either held steady in corporations or increased
in public accounting):
"Doctoral-Level Faculty Numbers Continue to Decline,"
AACSB,
June/July 2009 ---
http://www.aacsb.edu/publications/enewsline/datadirect.asp
And yet opportunities for graduates of accounting doctoral programs
is totally ignored in the latest article in the Chronicle of Higher
Education about the hottest academic jobs of the future. If I were
advising a confused undergraduate student who is contemplating a career
in academe, I would say look more closely at accounting, including the
warts of virtually all accounting doctoral programs ---
http://faculty.trinity.edu/rjensen/theory01.htm#DoctoralPrograms
"Hot Academic Jobs of the Future: Try These Fields," by Lee Roberts,
Chronicle of Higher Education, July 10, 2009 ---
http://chronicle.com/weekly/v55/i41/41b02201.htm?utm_source=at&utm_medium=en
Green chemistry
Green chemistry focuses on eliminating the
use of toxic chemicals in chemistry without stifling scientific
progress. Paul T. Anastas, a Yale University chemist, founded the
field in 1991. As it grows in importance, more institutions are
expected to offer master's degrees and doctorates. Among the
universities with green-chemistry programs are Carnegie Mellon and
Yale Universities and the Universities of Oregon, Scranton, and
Massachusetts at Lowell.
Terry Collins, a chemistry professor at
Carnegie Mellon who heads the university's Institute for Green
Science, thinks the intellectual rationale for the field is strong.
"It hasn't gotten a lot of federal support, but I think that's going
to change," he says. One reason: Mr. Anastas has been nominated by
President Obama to head the Environmental Protection Agency's Office
of Research and Development.
Energy
Threats to human society by the consumption
of limited resources have sparked a race to find alternative energy
sources that are sustainable, efficient, and safe for the
environment. Among the leaders in this research mission is the
Energy and Resources Group at the University of California at
Berkeley. The interdisciplinary group has been devising technical
and policy alternatives to unsustainable energy and resource use for
the past 30 years.
The Energy Efficiency Center at the
University of California at Davis identifies promising
energy-efficient technologies and develops viable business ventures
around them. Established in 2006 with a challenge grant from the
state, the center focuses on transferring technology from academe to
the marketplace.
Boston University's Center for Energy and
Environmental Studies, meanwhile, specializes in the fields of
energy and environmental analysis.
Gerontology
Not only are professors aging — everybody
else is, too. The aging process will take on a more prominent role
in society as the baby-boom generation ages, making studies like
gerontology a growth area, says Arthur Levine, president of the
Woodrow Wilson National Fellowship Foundation.
The oldest and largest school of
gerontology in the world is the Davis School of Gerontology at the
University of Southern California. It has conducted research in
molecular biology, neuroscience, dem-ography, psychology, sociology,
and public policy on aging since 1975.
The Universities of Kansas, Kentucky,
Maryland at Baltimore, and Massachusetts at Boston are among those
offering doctoral programs in the field.
Education
The Bureau of Labor Statistics projects
that the number of postsecondary educational administrators will
increase by 14 percent from 2006 to 2016.
"The leadership turnover in education is
going to be tremendous in the coming years," said Mark David
Milliron, president and chief executive of Catalyze Learning
International, an education-consulting group in Newland, N.C. "Folks
are scrambling to fill the C-level pipeline; as a result, Ph.D.'s
and Ed.D.'s are in high demand, and will be for some time."
Nanotechnology
A nanometer, one billionth of a meter, is
about 10,000 times narrower than a human hair. Nanotechnology is the
study of the control of matter on an atomic and molecular scale. It
has the potential to create materials and devices in fields as
diverse as electronics, energy production, and medicine.
Among institutions that offer programs in
the growing field are the Universities of Washington and North
Carolina at Charlotte; the State University of New York at Albany;
and Arizona State, Louisiana Tech, Pennsylvania State, and Rice
Universities.
Health policy
Just as gerontology will become more
important as the population ages, health-related fields and
health-care policy will remain vital in coming years. Some of the
influential universities for health policy and management are
Harvard, Johns Hopkins, and New York Universities.
Information technology
Harry Lewis, a Harvard professor of
computer science and one of the authors of Blown to Bits: Your Life,
Liberty and Happiness After the Digital Explosion (Addison-Wesley,
2008), believes information technology will remain a growth area in
the coming years. The Bureau of Labor Statistics agrees, projecting
that among selected occupations requiring a doctoral degree,
computer and information science will have one of the largest growth
rates — 22 percent — from 2006 to 2016.
Some of the better-known programs in
information technology are those offered by the University of
California at Berkeley, the Georgia Institute of Technology, the
Massachusetts Institute of Technology, and Stanford University.
Engineering
There always seems to be a high demand for
engineers of one kind or another, and the next decade should be no
exception. Engineering comprises such a broad array of studies and
competencies that it can lead to vastly different careers. In
especially promising fields, the Bureau of Labor Statistics sees
environmental engineering experiencing 25-percent growth between
2006 and 2016, and industrial and biomedical engineering each
experiencing about 20-percent growth in that time.
Jensen Comment
I think that for many years to come, new accounting PhDs will have many
more choices about where to accept job offers and what they will earn in
their new jobs at colleges and universities.
July 10, 2009 reply from Patricia Walters
[patricia@DISCLOSUREANALYTICS.COM]
Full disclosure: I'm clinical faculty and
had an 12 year gap between my two academic lives. I have a 3-year
contract (which I was glad didn't come up for renewal this year).
In my view, this salary inversion (I
believe your ratio is typical) is one of the costs of having tenure.
I personally don't think of it as a "penalty" although I do
understand why tenured faculty feel that way.
Rather, I view this differential between
tenured faculty salaries and other market-based salaries (whether in
or outisde of academia) as the market price for bearing the risk of
losing one's job (which tenure track faculty is still subject to).
I don't know but wonder if there is any
data on the percentage of tenure track faculty who actually are ABLE
to stay at their first school.
Pat
July 10, 2009 reply from Bob Jensen
Hi Pat,
Remember that in major universities, publications in leading
academic journals are the major things counted (not necessarily
read) for performance raises. Teaching has a minimum threshold but
is secondary to publication records.
Salary compression arises from many suspected causes, not the
least of which is that tenure protects the jobs but not the
performance raises of faculty with declining research productivity.
In accounting, the very few tenured faculty with increasing research
productivity generally do move on to endowed chairs or at least
named professorships in other universities.
It’s surprising how many accounting faculty who are highly
productive (relative to other accounting researchers and not
chemists) in their non-tenure years actually burn out in terms of
research. Some actually move into administrative positions because,
in my viewpoint, they want out of both teaching and research and
still obtain high performance raises.
If you extract from the TAR publishing records of hot non-tenured
accounting faculty, you get the picture that accounting researcher
productivity generally declines as the tenure years pile on ---
http://faculty.trinity.edu/rjensen/395wpTAR/Web/TAR395wp.htm
Universities also take advantage of the fact that salary is only
one of the factors leading to family decisions to not move to new
towns. There is a stickiness due to spouse employment, children in
good schools that they really like, transactions costs of home
selling, unwillingness to give up friends and other neighbors,
unwillingness to depart colleagues at work, and just plain fear of
the unknown.
Another factor that I tended to ignore (except for one time) was
the risk of giving up tenure in the old job for having to go through
the tenure process once again in a new job. Although the University
of Maine gave me the Nicolas Salgo endowed chair and tenure when I
moved from Michigan State, I became the KPMG Professor at Florida
State without being given tenure in advance. Trinity University gave
me the Jesse Jones endowed chair without giving me tenure up front.
In hindsight, things worked out for me, but I can name at least
one instance (at Notre Dame) where a well known accounting professor
given a chair and then denied tenure afterwards.
Bob Jensen
Second June 10, 2009 replay from Patricia Walters
[patricia@DISCLOSUREANALYTICS.COM]
Bob:
You are of course right on all counts
above. I would add that perhaps the primary reason I left academic
in 1994 was because I did not believe that I would have the
fortitude to do the necessary research to get tenure. I knew myself
well enough then to realize that I would put most of my efforts into
my teaching and so be constantly on the move. I also have no regrets
about my years at the CFA Institute. I believe my current teaching
is better because of the work and experience I had there. There are
huge personal costs to these moves, let alone the need to be
thinking about a job search. This is not to say that I don't also
have to write to maintain my academic qualification for AASCB
purposes. It just doesn't have to be the 'accountics' research that
is what's wanted in most of the top-tier journals.
There are also trade-offs between cash and
quality of life that academics must make which are not much
different that those other professionals make. There is money to be
made in consulting and continuing ed training by academics even
though the former may be more dependent on research than the latter.
One of the aspects of academia that I like, beside teaching and
interacting with students at the university, surprisingly is that,
if an opportunity comes along to do consulting or training work, I
can say 'no'. Something one cannot do (normally) without
consequences in a full-time job outside of academia. In that
respect, I can create my own balance between money and quality of
life.
The current trade-off I'm personally
struggling with is living in NJ when I really want to be living on
my farm in VA and this struggle is despite the fact I very, very
much like Fordham, its students, and my colleagues. It is a great
place to work.
Your comments about performance raises are
interesting. Clinicals at Fordham are not eligible for such
raises....all we can do is negotiate at contract renewal times. I
have the impression that these raises are not all that terrific
regardless of the amount of research one does, but I admit to not
having first hand experience.
Pat
- From My Accounting Degree.org
- Accounting Job Resources ***
http://myaccountingdegree.org/accounting-job-resources-mega-list
Articles ---
http://myaccountingdegree.org/articles
Accounting Degree Guide ---
http://myaccountingdegree.org/
Warning some of the for-profit degrees alternatives aren't worth the
time and money, especially the doctoral degrees. The job market pretty well
does not recognize accounting PhD degrees unless the university has AACSB
accreditation.
For-profit universities in general should be viewed skeptically ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#ForProfitFraud
I don't quite buy into all the words of
advice below, but Millennials should consider this package of advice.
Actually, they hear such horror stories about low hiring rates of college
graduates that they probably are following this advice before it was
written.
"When Entitlement Meets Unemployment," by Andrew McAffee,
Harvard
Business Review Blog, August 29, 2011 ---
http://blogs.hbr.org/hbr/mcafee/2011/08/when-entitlement-meets-unemplo.html?referral=00563&cm_mmc=email-_-newsletter-_-daily_alert-_-alert_date&utm_source=newsletter_daily_alert&utm_medium=email&utm_campaign=alert_date
. . .
Let's dispense
with this idea that Millennials are somehow just smarter than all
the generations that have come before. When I learn that over
one-third of undergraduates these days
show no significant gains after four years in vital skills
like critical thinking and written
communication, I have trouble seeing the broad genius of Gen Y.
Many employers
evidently agree; as of March, the
unemployment rate among Millennials
was,
at 18.8%, almost twice that of the general workforce. Given this
state of affairs, let me offer some advice to young job seekers that
goes against
current practices.
Take the
first decent job that's offered to you. Stop waiting for
one that recognizes all your talents and plays to all your
strengths.
Offer your
employer superior ROE — return on employee. Compared to
your peers, give your employer more and ask less. Trust me on this:
it'll be recognized, and you'll come across as a huge breath of
fresh air.
Take every
chance offered to you to learn a new skill.
Learn to
serve, not just to lead. Of course you think you could do a
better job running the place; everyone else thinks they could, too.
Until that happens, learn to be a good subordinate, teammate, or
customer liaison. Humility and selflessness are two of those new
skills you've just committed to learn after reading the previous
bullet point.
Keep in mind
that self-esteem comes from achievement, not the other way
around.
You Millennials,
through no fault of your own, have been dealt a bad hand; you're
just starting out during the worst job market in decades. I wish you
luck in the world as you navigate this, and I beg you to stop asking
for Pilates rooms. Getting and keeping a job is workout enough these
days.
Added Jensen Comment
McAffee hires mostly programmers and other tech graduates who are probably
more demanding in job interviews (they all want the perks offered by
Google). I think most history graduates and MBA school graduates are more
grateful if they can just get a job offer.
"European Business Schools Set Sights on U.S.: Seeking U.S.
students and a bigger global footprint, schools from Spain, France, and
the U.K. are rushing to set up outposts on American soil," by Alison
Damast, Business Week, June 17, 2010 ---
http://www.businessweek.com/bschools/content/jun2010/bs20100617_473655.htm?link_position=link1
Over the past decade or so, European
business schools have been aggressive about reaching out to the
American market, doing everything from forming alliances with U.S.
schools to launching student- and faculty-exchange programs. Now a
handful of elite European schools are taking this a step further,
trying to create a more substantial presence in the U.S. by opening
up traditional brick-and-mortar campuses.
In the past few months, schools from France
to the U.K. have announced plans to build campuses in the coming
year in the U.S., including one planned outpost announced just last
week. It's a strategic move by these institutions to increase their
stature and influence in the American market, says Robert Bruner,
dean of the University of Virginia's
Darden School of Business (Darden
Full-Time MBA Profile).
"The U.S. is where the MBA was invented
and, to some extent to establish a footprint in this market, is an
additional means of legitimizing a school's brand and stature
globally," says Bruner, who also chairs the Globalization of
Management Education Task Force of the Association to Advance
Collegiate Schools of Business, one of the leading business school
accreditation agencies.
Eye on the Hot Spots
That's a viewpoint that these European
B-schools are taking as they cautiously attempt to entrench
themselves in the U.S. A number of the schools that have announced
plans to build campuses are well-regarded universities in Europe,
but not as well-known by students outside their home countries. By
starting degree programs in such hot spots as Miami and New York,
they say they will be able to enhance their global reputation in
both the academic and business community in the U.S. as well as
expand and enhance the degree programs they offer students. Another
underlying motivation is the opportunity for them to recruit more
American students to their campuses. At most European business
schools, Americans make up just a handful of the students in the
degree programs, making it hard for them to build up a strong alumni
base in the U.S., deans at these schools say.
Many European business schools will be
watching closely to see whether these business schools will be
successful at branding themselves in the U.S., says Dave Wilson,
president and chief executive of the Graduate Management Admission
Council, which administers the Graduate Management Admission Test (GMAT).
Of U.S. GMAT test takers, the vast majority, or about 98 percent,
send their test scores to U.S. schools, leaving just a handful of
American students who consider non-U.S schools. The European schools
will have to work hard to attract these students to their U.S.
outposts, Wilson says.
"These are sort of pioneers who are
breaking new ground, and it will be a challenge to get U.S.
students," Wilson says. "I think most European schools are going to
sit back and watch, because this is really a brand new bet for
them."
Manhattan Opening
Just this May, Spain's
IESE Business School (IESE
Full-Time MBA Profile) opened the doors of
its New York campus on West 57th Street, a six-story building with
two classrooms, breakout rooms, and office space. The school had
been planning its U.S. campus for three years and has spent close to
$20 million refurbishing the building, says Eric Weber, an associate
dean of IESE and director of the school's New York office. Says
Weber: "We're pretty bullish about the U.S."
The school will not be offering an MBA
program at the New York office, but it has ambitious plans for the
site, which include promotion of its custom programs for executives,
establishing a research center on global business, and setting up
activities for alumni and corporate sponsors. Professors from the
school's Barcelona campus will take students to New York for several
weeks, where they will study business in the context of New York
City, Weber says.
Continued in article
Jensen Comment
One competitive advantage that foreign schools will bring to the table
is to play on the wanderlust of the typical four-year college graduate.
Before becoming tied down with a spouse and children, the lure of Europe
is especially appealing to some graduates. Graduates recall hearing in
class about all the world adventures of many of their professors,
especially professors in humanities who often focus their own research
on romantic European history, language, and literature. Students may see
a European business school degree as having greater opportunity for job
offers in Europe --- which may be a myth in many instances. Of
course other students may lean toward Asian-school degrees for the same
reasons. For a while Russia was popular until living in Russia became so
dangerous and Russian universities became more corrupt.
"Howard University’s Study on Attracting Minorities to Accounting,"
Financial Accounting Foundation, Undated ---
http://www.accountingfoundation.org/diversity
The Howard University School of Business Center
for Accounting Education recently published a study
"Attracting Underrepresented Minorities to the Accounting Profession:
Insights into Diversifying the Talent Pipeline" (April 2014)
that sheds light on the lack of diversity in the
accounting profession.
More specifically, the study focuses on the challenges in attracting
students to the career:
Despite decades of intensive efforts, the
accounting profession has not reached its diversity goals. One reason is the
misperceptions about accounting as a career. Studies suggest that young
people, including underrepresented minorities, hold the profession in
relatively low regard, do not understand what accountants do, and do not
appreciate the career opportunities the profession offers.
It turns out that this lack of esteem is widely shared
by parents and educators, the two groups with the most influence on young
people’s academic and career choices.
Improving the quality of accounting curriculum and expanding internship and
scholarship opportunities are essential elements in creating a new,
meaningful perception of the accounting profession.
While the accounting profession is expected to grow by 16 percent between
2010 and 2020, applications by African Americans and Hispanics to accounting
programs at colleges and universities actually are declining, the Howard
study notes.
Additionally, African Americans and Hispanics – who together comprise about
30 percent of the U.S. population – represent just four percent of all
partners in the accounting profession,
according to data published by the American
Associations of CPAs. Caucasians still hold
approximately 75 percent of the professional positions in accounting, and 90
percent of the partnerships.
All of this is occurring while the number of minority-owned businesses is
projected to skyrocket.
Table not reproduced here
Partnering to Form a Pipeline for
Diversity
As a result of the study, the Howard Center for Accounting Education has
partnered with the American Institute of CPAs to establish the “Pipeline
Working Group” to create a unified, nationwide initiative that reaches
out to underrepresented minority students at high schools, community
colleges and universities, as well as to their teachers, guidance
counselors, and parents—to educate them about the profession.
The notion of working collaboratively to help
increase the pipeline of diverse talent into the industry as a whole
is a new idea – and one that deserves support—FAF President &
CEO Terri Polley
The Working Group’s members include
representatives from Deloitte, EY, KPMG, PwC, BDO, the National
Association of Black Accountants, the Association of Latino
Professionals in Finance and Accounting, the New Jersey Society of CPAs
and other organizations.
The Howard study outlines a five-pronged approach to diversifying the
talent pipeline, through the development and implementation of:
- A national marketing and awareness
initiative highlighting the benefits and intellectual rewards of
accounting as a profession, aimed at students who are making career
choices.
- School-based programs intended to promote
accounting as a high-value career choice, including business career
academies, summer development programs, and other community
programs.
- Initiatives aimed at helping minority
students earn their CPA and other professional certifications.
- Internships and career exploration
opportunities to provide high school and college students the means
to become familiar with the accounting profession.
- Programs that both increase the number of
accounting scholarships available to minority students and that more
widely publicize scholarships that already are available.
A Call to Action
According to FAF President & CEO Terri Polley, the pipeline initiative
represents a call to all in the profession to join a critically
important conversation about the future.
The FAF has begun to hold conversations with
the Center for Accounting Education and the AICPA regarding the role
that the FAF, FASB and GASB – and other stakeholders – can play in the
development of the diversity pipeline initiatives.
Ensuring the success of the pipeline initiative
is in the best interests of all in the accounting profession. Therefore,
it is expected that the collaboration and support of firms, state
societies, and institutions will determine the success and longevity of
the pipeline initiative. Organizations interested in the cause can
educate their stakeholders on the key issues facing the profession and
invite leaders to share their ideas on how to promote the five
initiatives.
Jensen Comment
An extremely important, in my viewpoint, initiative is the KPMG initiative
of getting role model faculty into colleges and universities that inspire
minority students who take an early course in accounting or business.
KPMG Foundation Grants (other accounting firms contribute to this
Foundation) ---
http://www.kpmgfoundation.org/foundinit
The Minority Ph.D, Program Initiative
---
http://www.phdproject.org/
The PhD Project was founded upon the premise
that advancements in workplace diversity could be propelled forward by
increasing the diversity of business school faculty. Today, our
expansive network of supporters, sponsors and universities helps
African-Americans, Hispanic-Americans and Native Americans attain their
business PhD and become the business professors who will mentor the next
generation of leaders.
"KPMG Foundation Celebrates 15th Year of Minority Accounting Doctoral
Program," SmartPros, August 1, 2009
---
http://accounting.smartpros.com/x67298.xml
The KPMG Foundation
is marking the 15th anniversary of its Minority Accounting Doctoral
Scholarship program by announcing today it has awarded a total of $390,000
in scholarships to 39 minority doctoral scholars for the 2009 - 2010
academic year.
Of the awards, eight
are to new recipients scheduled to begin their accounting doctoral program
this fall, three are to new recipients who have already begun programs, and
28 are renewals of scholarships previously awarded.
Each of the
scholarships is valued at $10,000 and renewable annually for a total of five
years. The Foundation established the scholarship program in 1994 as part of
its ongoing efforts to increase the number of minority students and
professors in business schools – and has since awarded $8.7 million to
minorities pursuing doctorate degrees.
“We’re proud of the
achievements of our program over the last 15 years, and we have seen a
healthy increase in the number of minority faculty members at our nation’s
business schools, although more work needs to be done,” said Bernard J.
Milano, President of the KPMG Foundation and The PhD Project. “That’s why we
continue to award new scholarships each year and we remain committed to our
mission.”
Together with The PhD
Project, a related program whose mission is to increase the diversity of
business school faculty, the Minority Accounting Doctoral Scholarship
program has helped to more than triple the number of minority business
professors in the United States since The PhD Project first began in 1994.
Today, there are 985 minority business school professors teaching in the
United States. Nearly 400 minority students are currently enrolled in
business doctoral programs.
The Minority
Accounting Doctoral Scholarship recipients come from a wide variety of
cultures and backgrounds. This year’s new recipients are:
Continued in article
Jensen
Comment
Under the guidance of KPMG Executive Partner Bernie Milano this program
became more than a money awards program. KPMG works with some recipients in
customized counseling and assistance when problems arise for certain
individuals still studying for their doctorates. Various types of problems
arise, including some crises within families.
Minority Hiring Success Varies
Greatly by Discipline: Law, Business, and Sciences Have the Worst
Records
The major cause lies in the supply chain
of PhD graduates
One of the
reasons for the shortage of minority undergraduate students in
accounting has been the lack of role models teaching accounting courses
in college.
"Whatever Happened to All Those Plans to
Hire More Minority Professors?" by Ben Gose, Chronicle of Higher
Education, September 26, 2008
http://chronicle.com/weekly/v55/i05/05b00101.htm?utm_source=at&utm_medium=en
Duke U.: Success
rates vary by discipline
The black faculty
Strategic Initiative began in 1993, on the heels of the failed
effort to add at least one black professor to every department.
As of the fall
of 2007, Duke had 62 tenured or tenure-track black professors,
accounting for 4.5 percent of the faculty. But while the raw number
is double that of 20 years ago, it masks tremendous variation within
the university. Black professors
remain rare in the law school, which has one black professor, the
business school, with two, and the natural sciences, with three.
Karla FC Holloway,
an English professor who served as dean of humanities and social
sciences from 1999 to 2005, says each unit of the university should
be held accountable for its record on diversity. "There has been
growth in arts and social sciences, and medicine, but in some ways
that growth has arguably allowed other schools or divisions not to
work as aggressively with this effort," she says.
Mr. Lange, the
provost, concedes that some parts of the university have fallen
short. He says he is working closely on the issue with the law
school's dean, David F. Levi, and other officials. "They have made
offers and have not been successful at times," Mr. Lange says.
"They're putting in a lot of effort to do better."
Duke makes sure that
when black job applicants visit the campus, they meet other black
faculty members — and not just potential colleagues in the
department to which they're applying. The university also is taking
small steps to widen the pipeline. Duke has financed two
postdoctoral positions for minority candidates each year, with the
hope that it will eventually hire some of them for tenure-track
faculty positions.
In 2003, Duke
started yet another faculty initiative related to diversity — but
this time the scope was expanded to include women and all
underrepresented minority groups. "We needed to recognize that
diversity had come to include a substantially broader set of
concerns," Mr. Lange says.
Ms. Holloway worries
that the broader focus may give deans and department chairs an out:
"People can say, 'I've hired enough women, and that makes up for the
lack of minorities.'"
Harvard U.:
Uneven progress on racial diversity
Harvard created an
office of faculty development and diversity, to be headed by a
senior vice provost, in 2005, shortly after announcing that it would
spend $50-million to help diversify the faculty.
In the more than
three years since that commitment, the university has made modest
progress in diversifying its faculty, and some professors believe
that the new office deserves some of the credit. Kay Kaufman
Shelemay, a professor of music and of African and African-American
studies, says the office has done a good job compiling statistics
related to diversity and working with deans and department chairs to
ensure that they cast a wider net in their searches. "There is no
doubt that the office established by former President Summers both
invigorated and centralized our institutional efforts," Ms. Shelemay
says.
Women now make up 16
percent of tenured and tenure-track faculty members in the natural
sciences, up from 12 percent in 2004-5. In the humanities, 32
percent of the professors are women, up from 30 percent, and in the
social sciences, 31 percent are women, up from 28 percent.
The changes for the
professional schools over that period varied — law, engineering, and
government all saw significant gains for women, while the proportion
of female faculty members actually dropped in the schools of
divinity, dentistry, and education.
The university's
progress on racial diversity, meanwhile, has been uneven. More than
6 percent of the tenured and tenure-track faculty members in the
social sciences are black, but black professors make up 1 percent or
less of faculty members in the natural sciences and the humanities.
Hispanic professors make up no more than 2 percent of faculty
members in each of those three areas.
In 2006, Harvard
committed $7.5-million to improve child care on the campus — a
primary concern of female faculty members. The university also just
completed its third year of a summer program aimed in part at
improving the pipeline for female and minority professors. The
program allows undergraduates to spend 10 weeks in the research
laboratories of science and engineering faculty members. More than
half of the 400 participants have been women, and more than 60
percent have been minority students.
Judith D. Singer, a
professor of education who became senior vice provost for faculty
development and diversity in June, says she was willing to take on
the job because the climate "feels different" under Drew Gilpin
Faust, Harvard's first female president. But Ms. Singer acknowledges
that progress has been uneven among departments and divisions.
"Addressing issues
of diversity remains a challenge throughout higher education," she
says. "We at Harvard, like our peer institutions, must do better."
U. of Wisconsin
at Madison: Progress in fits and starts
The university
undertook its Madison Plan in 1988, vowing to double the number of
black, Hispanic, and American Indian professors by adding 70 new
faculty members within three years.
Progress has come in
fits and starts. A Wisconsin official told The Chronicle in
1995 that the university hadn't made the progress it had hoped for.
The number of tenured or tenure-track black professors, for example,
increased only 61 percent, to 37, in that seven-year span. The total
then surged to 60 by 2001, only to stall. Over the six years ending
in 2007, the number of black professors dropped to 51.
Mr. Farrell, the
provost, argues that part of the challenge is increased competition.
While institutions like Wisconsin were among the first to spell out
ambitious plans to diversify the faculty, now almost every
institution has one. "We compete with everybody else for the pool
that exists," he says.
Damon A. Williams,
who became vice provost for diversity and climate in August, says
Wisconsin and other universities must seek out minority job
candidates more aggressively. For example, he wants to see Madison
recruit aggressively at the annual Institute on Teaching and
Mentoring, sponsored by the Southern Regional Educational Board and
attended by hundreds of minority Ph.D. candidates.
"We have to be
visible and present at that meeting and be willing to sell ourselves
to them," he says.
Wisconsin's record
with Hispanic and American Indian faculty members has been stronger.
The university had 77 Hispanic professors in 2007, up from 53 in
1998, and 13 American Indian professors, up from four in 1998.
The growth of
American Indian studies — in a state that is home to several Indian
tribes — has helped attract new American Indian professors to the
campus, Mr. Farrell says. "Professors who visit say, 'OK, here's a
place where people from our background can thrive, fit in, and have
success.'"
Still, Wisconsin and
other universities must persuade more minority undergraduates to
pursue academic careers, the provost says. The engineering school
has developed a fellowship program, aimed primarily at minority
graduate students, that encourages them to pursue research
immediately. That program is being copied by the College of Letters
and Science.
"When students spend
their first year or two just on class work," Mr. Farrell says, "they
find graduate school is not nearly as interesting as they thought it
would be."
Virginia Tech: A
bigger faculty role in hiring
The university made
an extraordinary effort to diversify its campus starting in the late
1990s, and it paid off: During the three years ending in 2002, the
number of black tenured and tenure-track professors in the College
of Arts and Sciences rose by more than 50 percent, to 17; the number
of Hispanic professors more than doubled, to seven; and the
proportion of female professors rose from 20.6 percent to 23.6
percent.
Myra Gordon, an
associate dean who left Virginia Tech in 2002, was the architect of
the plan. At the time, faculty members complained that she had
essentially taken over their role of hiring new professors.
Mark G. McNamee, the
provost since 2001, says that while the university remains strongly
committed to diversifying the faculty, some of the tactics that were
criticized have been reined in or eliminated. Now he and the deans
offer input at beginning of the process but for the most part let
faculty members have the final say in hiring.
"It was a much more
centrally controlled process at the time," Mr. McNamee says. "The
deans are still engaged and have responsibilities, but they're not
perceived as unduly influencing what the outcome is going to be."
It is difficult to
evaluate progress in the College of Arts and Sciences since then,
because it was divided into smaller colleges several years ago. Over
the four years ending in 2007, the university had a net increase of
five black and five Hispanic professors. Black faculty members make
up about 3 percent of the tenured and tenure-track professoriate,
Hispanic faculty members less than 2 percent, and women 24.3
percent.
In 2006 students
protested the university's decision not to grant tenure to a black
professor known for his activism on affirmative action and other
causes. Mr. McNamee promised to establish a committee to study the
role of race at the university. "When someone doesn't get tenure,
that doesn't help us, but that's just the way it is sometimes," he
says now.
In August the
committee released a plan that calls for a cluster of six new hires
in Africana studies and race and social policy.
Virginia Tech also
frequently invites professors from historically black universities
to deliver lectures on the campus, in part to elevate awareness of
the university among those lecturers.
"Once people know
Virginia Tech," says Mr. McNamee, "they really like it a lot better
than they think they're going to like it."
Continued in article
To its credit, the Big Four accounting firm KPMG, inspired heavily
by Bernie Milano at KPMG, years ago created a foundation (with multiple
outside contributors) for virtually five years of funding to minorities
to selected for particular accounting doctoral programs ---
http://www.kpmgfoundation.org/foundinit.asp
Minority Accounting Doctoral
Scholarships
The KPMG Foundation Minority Accounting
Doctoral Scholarships aim to further increase the completion rate
among African-American, Hispanic-American and Native American
doctoral students. The scholarships provide the funding for them to
see their dreams come to fruition.
For the 2007-2008 academic year, the
Foundation awarded $10,000 scholarships (annually), for a total of
five years, to 9 minority accounting and information systems
doctoral students. There are 35 doctoral students who have had their
scholarships renewed for 2007-2008, bringing the total number of
scholarships awarded to 44. To date, KPMG Foundation's total
commitment to the scholarship program exceeds $12 million.
Financial support often determines whether
a motivated student can meet the escalating costs of higher
education. For most of those students, a return to school means
giving up a lucrative job. For some, acceptance in a doctoral
program means an expensive relocation. Still others need enough time
to study without the burden of numerous part-time jobs.
Jensen Comment
This is more than just a pot of money. KPMG works with doctoral
program administrators and families of minority candidates to work
out case-by-case solving of special problems such as single
parenthood. I think added funding is provided on an as-needed basis.
The effort is designed to help students not only get into an
accounting doctoral program but to follow through to the very end.
It should be noted that although KPMG started this effort, various
competing accounting firms have donated money to this exceptionally
worthy cause. One of the reasons for the
shortage of minority undergraduate students in accounting has been
the lack of role models teaching accounting courses in college.
Universities,
if they are going to encourage the careers of women (and of everyone),
she said, need to be willing to embrace “people with different values”
and be sure that they are fully included. To the extent some men “will
compete for anything,” Downey said, that should not set a standard where
only women who share those values can succeed in academe. The success of
women and men, she said, can be judged on their work and not
competitiveness. “It’s no longer useful to have a ’sink or swim’
mentality,” she said.
"New Questions on Women, Academe and Careers," by Scott Jaschik,
Inside Higher Ed, September 22, 2008 ---
http://www.insidehighered.com/news/2008/09/22/women
Bob Jensen's threads on affirmative
action in hiring and pay raises are at
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#AffirmativeAction
"The Two-Part CMA Exam for 2010," by James Martin, MAAW's
Blog, March 20, 2010 ---
http://maaw.blogspot.com/2010/03/new-two-part-cma-exam-2010.html
Also see
http://maaw.info/ArticleSummaries/ArtSumBrauschWhitney2010.htm
Bob Jensen's threads on management accounting are at
http://faculty.trinity.edu/rjensen/theory01.htm#ManagementAccounting
His wife is even for sale and marked down at that!
From The Wall Street Journal Accounting Weekly Review on April 8,
2011
A Tax Man Takes Account of His Life
by: Laura Saunders
Apr 05, 2011
Click here to view the full article on WSJ.com
TOPICS: Accounting
Education, Personal Taxation, Public Accounting, Tax Accounting, Tax
Laws, Tax Planning, Taxation
SUMMARY: The article
describes the lifestyle of Doug Stives, a CPA from Red Bank, NJ, who now
can enjoy peak skiing season conditions out west after leaving his job
as a partner at accounting firm The Curchin Group. His full-time
position is now an accounting professor at Monmouth University in New
Jersey. All of his accounting and tax practice work is now done as a
self-employed contractor reporting on Schedule C.
CLASSROOM APPLICATION: The
article is useful for a tax class discussing deductions , particularly
on Schedule C, and for any class covering professional accounting work
plans.
QUESTIONS:
1. (Advanced) What type of income is reported on Schedule C as
attached to U.S. Form 1040?
2. (Introductory) How did Mr. Stives's move from being a
partner at an accounting firm to a position as an accounting professor
and director of the MBA program at Monmouth University allow him to
change reporting of his income on his U.S. Form 1040? Be specific.
3. (Introductory) How did that change in income reporting also
change the deductibility of Mr. Stives's travel and other expenses?
4. (Advanced) How could the IRS challenge deductibility of Mr.
Stives's travel expenses? Be specific in your description of the theory
behind the potential issue.
5. (Advanced) Could you replicate Mr. Stives's approach
immediately after college graduation? Explain your answer.
Reviewed By: Judy Beckman, University of Rhode Island
"A Tax Man Takes Account of His Life," by: Laura Saunders, The Wall
Street Journal, April 5. 2011 ---
http://online.wsj.com/article/SB10001424052748703696704576222590253291266.html?mod=djem_jiewr_AC_domainid
In the thick of tax season, most certified
public accountants are chained to their desks grinding out returns.
Doug Stives, a CPA from Red Bank, N.J., went
skiing in Utah.
"I always dreamed of coming here for peak
conditions," he said in mid-March between runs at Snowbasin Resort.
The trip is among the many perks that have
accrued from his decision, in 2006, to become, in effect, The Most
Tax-Efficient Man in America. The experiment has led to a new career,
frequent travel and obsessive documentation of expenses, such as a $6
hot dog he recently bought in the Philadelphia airport.
The "aha" moment came to him, he says, after a
college approached him about a teaching gig and he realized he could put
into practice many of the tax strategies he had learned over the
decades.
Step One was to change jobs. Mr. Stives had
been a partner for 36 years at The Curchin Group, an accounting firm. By
accepting an offer to teach tax and accounting courses full-time at the
Leon Hess Business School of Monmouth University in New Jersey, he was
able to tap into a broad array of tax-free employee benefits not
available to him at the firm.
Step Two was the formation of Doug Stives LLC,
the separate consulting business to which he attributes an impressive
array of expenses. In general, people who are employees and have side
businesses are often in the best position to maximize the tax code's
benefits, say experts. Mr. Stives calls this "the best of all worlds."
The result, says Mr. Stives, is that while he
earns less than 75% of his earlier pay, he takes home almost 90% as
much. And he says he reaps another $40,000 a year in tax-free benefits
from his college gig. Among other things, the school adds to his 401(k)
contribution and provides tax-free, discounted health plans for Mr.
Stives and his wife, plus disability insurance. As a partner in the
accounting firm, he had to fund such expenses himself.
Not that all is perfect now. One peeve: dealing
with what he calls "airline nonsense"—long lines, rising fees and
canceled flights. But overall, he says, "my quality of life is so much
higher."
His wife of 40 years, Elizabeth Stives, agrees.
"We travel so much now for his business," she says. "Next is Lake
Tahoe."
Mr. Stives, 64 years old, says he's too miserly
to focus solely on maximizing deductions—a practice he calls a "rookie's
mistake." In 2010, for example, he spotted a bonanza in "bonus
depreciation" for large SUVs used in a business, but didn't need another
car. "Sometimes my cheapness overcomes my love of tax savings," he says.
"My wife will tell you I got her on sale."
Instead, he says, he uses the tax code's many
quirks as the means through which he can live a fuller life.
Continued in article
An Accounting Love Song
One of Tom Oxner's former students (Travis Matkin) wrote and recorded
this song a couple of years ago. It has now made it to U Tube ---
http://www.cfo.com/blogs/index.cfm/detail/13525940?f=search
The great
strength of the AICPA is that it brings so many men and women together
as members of a single profession. Individually, we do great things for
American households, businesses and governments. Together, we are an
even more powerful force for prosperity in the economy at large—we pool
our knowledge and speak with one voice. In the face of many challenges,
we—as a united profession—have a fantastic future ahead of us.
AICPA Chairman Randy Fletchall’s inaugural
speech delivered as he accepted the chairmanship of the Institute’s
Board of Directors at the governing Council’s October 2007 meeting in
Tampa, Fla. ---
http://www.aicpa.org/pubs/jofa/jan2008/united_profession.htm
AICPA=American Institute of Certified Public Accountants ---
http://www.aicpa.org/
AICPA Accounting Education Center ---
http://ceae.aicpa.org/
October 30, 2008
message from Barry Rice
[brice@LOYOLA.EDU]
Colleagues,
I haven't seen
anything on AECM about this but may have missed it.
"About This
Site
If you're a high
school or college student interested in a successful career in
business and accounting, The Start Here. Go Places. Web site is
a free resource that can help you get there. You may be unsure
of the path you want to take, and where to find consolidated
resources to help you determine your career choices. Now's your
chance to learn about all that the study of accounting and the
pursuit of CPA certification has to offer—it's a path to
achieving a successful, rewarding and challenging career.
The site
includes study information, simulation games, scholarship and
internship listings, profiles of successful CPAs and career
opportunities. It is brought to students and educators by the
American Institute of Certified Public Accountants."
"Why register
for this free site? StartHereGoPlaces.com offers:
- Exclusive
info and articles about business and accounting
- Access to
challenging online games and contests
- Personalized information, emails and tools that can help you
build a career in business and accounting"
E. Barry Rice
AECM Founder
Two States Partner to Offer New Student ePortfolios ---
http://www.convergemag.com/story.php?catid=421&storyid=108084
Accounting is the most popular major on US
college campuses, according to the Job Outlook 2005 survey by the
National Association of Colleges and Employers. The study found more
college students are choosing to pursue accounting than any other
discipline, followed by electrical engineering, mechanical engineering
and business administration/management.
CA Magazine, "The New IT Profession," April 2006 ---
http://www.camagazine.com/index.cfm/ci_id/30481/la_id/1.htm
2009 Best Careers: Forget Accounting and Think Usability Experience
Specialist or Ghostwriting
Comparing Career Apples vs. Oranges vs. Fiats
Jensen Comment
To me this listing is nonsense. Anybody who thinks the job outlook and
employment security for management consulting and ghostwriting is better than
for a tenured college professor or CPA is nuts. Anybody who attempts to compare
engineering and veterinarian careers with hair styling, physical therapy, and
ghostwriting has to be nuts.
The above listing ignores some of the job attributes that make some careers
the most satisfying. For example, college professors generally love their
40-50 year careers because of the independence they have in choosing work-day
schedules, to say nothing of the generous term breaks and summer freedom months,
although there are pressures to conduct research and write that fill much of
this supposedly "free time." But many college professors would not trade their
time-freedom jobs for twice the pay on a routine grind that forced them to work under close supervision
eight hours each day for 50 weeks per year. K-12 teachers do not get the daily
time independence of college professors but they do get the summer freedoms
(teaching summer school is usually an option rather than a requirement).
Many people love their careers because of how the career itself
expands their minds across the 40-50 years. College professors and
physicians have to constantly renew their research and scholarship in
order to keep up with or stay ahead of the times. Physical therapists
and pharmacists who fill physician prescriptions at Wal-Mart also have
to keep up with the times, but the effort needed to stay on top of their
day-to-day jobs just cannot be compared with academic scholarship.
I often thought that the most boring careers for
50 years running have to be such things as physical therapy, audiology,
pharmacy, fund raising, hair styling, locksmithing, etc. What in the heck is a
Usability Experience Specialist and how can I compare it with being a forensic
accountant?
The 30 careers mentioned above are too varied in terms of skill sets, income,
and types of alternatives within a career. We can pretty well picture
what a Hairstylist/ Cosmetologist will be doing for 50 years, but it is harder
to envision what a management consultant or engineer will be doing from year to
year. If a person is a very good writer, why not write for yourself rather
than write for a ghost?
Some of the careers listed in the above top 30 have to be terribly boring day
in and day out for 40-50 years. I'd rather be a college professor than be stuck
in any of the 30 alternatives listed above. At the moment careers in accounting
have stronger outlooks, although "job satisfaction" is hard to generalize since
there are so many different types of accounting jobs ranging from the FBI to IRS
agent to corporate accountant to being an auditor for an international firm to
being a sole CPA practitioner on Main Street, USA.
My advice to a young person is to take early moves that provide wide-ranging
opportunities later in life, especially when entering the first year of college.
I know a recent high school graduate who had to choose between a major state
university and a pharmacy school (six years). She chose the pharmacy school in
Boston. I
think that was a mistake for an eighteen year old graduate from high school,
because she's becoming too specialized before the first day of college. Going to a traditional
university for the first year or two and then making some narrowing choices would be
far better. Even majoring in accounting after the first year at a state
university, she would have
wide-ranging career alternatives vis-a-vis pharmacy school.
I know some young clergy that are miserable in their careers. They love
counseling and mission work and preaching. But the fund raising demands and the
need to constantly draw in new people into the church in order to maintain
sagging church budgets, building funds, and money for your own salary becomes
depressing year after year --- and there's the
reality of having to suck up to irritating, often elderly, people who constantly
let you know that their happiness in the church is essential to your success.
Clergy face the constant threat that irritating benefactors will join another
church. At
least a college professor is not stuck with the same irritating students for
40-50 years of life. I would rather have new and varied irritating students than
Ebenezer Scrooge on my church board for 20 years.
I think the above listing of supposedly top careers is more misleading than
helpful to young people and their parents. Comparing such varied careers is even
worse than comparing vegetables ---
http://faculty.trinity.edu/rjensen/FraudConclusion.htm#BadNews
The Secret of Why Bob Jensen Became an Accounting Professor and Not a
Practicing CPA
Nursing Schools Should Warn Students About Grueling Hours
Nursing schools should do a better job
preparing students for the grueling hours, often unrealistic
expectations, and lack of respect that await them when they enter the
work force, says an article scheduled for publication today in the
July/August issue of Nursing Outlook.
MIT's Technology Review, July 27, 2009 ---
http://chronicle.com/article/Nursing-Schools-Should-Warn/47468/
Jensen Comment
Although I always mentioned the long hours faced by newly-hired CPAs,
especially in tax season, I'm not sure I ever said enough about it to a
point that I did not have some (I like to think only a few students) who really
became upset over the long hours and pressures in CPA firms. Perhaps
this has changed somewhat, but one of the problems that remains is that
many newly-hired students have to travel much more than they expected as
either CPA auditors or corporate internal auditors. When out of
town there's a tendency to work days and nights, sometimes in an effort
to shorten the time on the road away from home.
Truth Time
When I became a CPA and worked for the largest accounting firm in
Denver, I was also an avid, and unmarried, snow skier. I was even
tempted to become a ski bum except that my entire family history made me
fearful of living without income and security. I was also getting an MBA
at the University of Denver and watched my professors work what seemed
to me like 12 hours a week while living in the security of tenure for
life. This seemed perfect for becoming having my ski time and still
having guaranteed income for life.
I even came to a point where I had an ink pen poised above a contract
at Western State College in Gunnison, Colorado where I could get a
tenure track position, in those days, with only a MBA-CPA credential. As
I lowered the pen, I casually asked the Dean how far it was from
Gunnison to Aspen (which looked to be less than 30 miles on the map). He
said it depended upon whether it was summer or winter. The pass was
closed in the winter such that the shortest route was over 200 miles by
going around through Leadville.
I dropped the pen and decided to accept a full-ride scholarship that
Stanford University had offered me a few days earlier to enter the
accounting doctoral program. The rest is history. I skied some while at
Stanford, but after I got married at the dissertation stage of my
studies, I gave up skiing and chasing wild women. More importantly I
discovered that being a professional teacher and researcher was more fun
and challenging than being a ski bum.
It's probably a very good thing that I gave up being a ski bum. I
always tended to be a bit of a hot dog skier who skied one or two
notches above my real farm boy ability. Undoubtedly I would be dead or
paralyzed if I'd truly become a ski bum.
Interestingly as a professor and even as a retired professor I've
worked longer hours year in and year out that most practicing CPAs. But
this is a labor of love and a challenge to the mind and great relief
from the boredom of leisure time.
About 20 years ago I recorded a sloppy audio file about becoming a
professor ---
http://www.cs.trinity.edu/~rjensen/academ01.wav
Harvard teaches rejection acceptance to students who've probably
never experienced failure and never expected rejection as Harvard
graduates
How bad is the
economy? Harvard University's career
services office has started a new
seminar to teach students how to
deal with rejection,
The Boston Globe
reported.
Among the lessons for students: the
idea that there may be more
qualified people than Harvard
graduates for some jobs.
Inside Higher Ed, April 22,
2009 ---
http://www.insidehighered.com/news/2009/04/22/qt#197100
It's so sad that Wall Street shot itself in the head rather than
the foot!
With Finance Disgraced, Which Career Will Be King?
"With Finance Disgraced, Which Career Will Be King?" by Steve Lohr,
The New York Times, April 11, 2009 ---
http://www.nytimes.com/2009/04/12/weekinreview/12lohr.html?pagewanted=1&hpw
In the Depression, smart college students
flocked into civil engineering to design the highway, bridge and
dam-building projects of those days. In the Sputnik era, students
poured into the sciences as America bet on technology to combat the
cold war Communist challenge. Yes, the jobs beckoned and the pay was
good. But those careers, in their day, had other perks: respect and
self-esteem.
Big shifts in the flow of talent can ripple
through the nation and the economy for decades with lasting effect.
The engineers of the Depression built everything from inter-city
roads to the Hoover Dam, while the Sputnik-inspired scientists would
go on, often with research funding from the Pentagon, to create the
building-block innovations behind modern computing and the Internet.
Today, the financial crisis and the
economic downturn are likely to alter drastically the career paths
of future years. The contours of the shift are still in flux, in
part because there is so much uncertainty about the shape of the
economic landscape and the job market ahead.
But choosing a career is a guess about the
future in which economics is only part of the calculation. Prestige,
peer expectations and the climate of public opinion also matter. And
early indications suggest new career directions that are tethered
less to the dream of an immediate six-figure paycheck on Wall Street
than to the demands of a new public agenda to solve the nation’s
problems.
The deep recession has clearly battered
industries — and professions — whose economics were at risk before
the downturn. Law firms are laying off lawyers as never before and
questioning the industry’s traditional unit of payment, the billable
hour. Journalism is reeling from the falloff in advertising and the
inability of newspapers and magazines to make a living on the Web.
Still, the industry whose troubles are
having the greatest impact on the rethinking of careers, especially
at the nation’s elite universities, is the one at the center of the
country’s economic downturn — finance. For years, the hefty
paychecks and social status on Wall Street proved irresistible to
many of America’s brightest young people, but the jobs, money and
social respect there are much diminished today.
“In choosing careers, young people look for
signals from society, and Wall Street will no longer pull the talent
that it did for so many years,” said Richard Freeman, director of
the labor studies program at the National Bureau of Economic
Research. “We have a great experiment before us.”
What will the new map of talent flow look
like? It’s early, but based on graduate school applications this
spring, enrollment in undergraduate courses, preliminary
job-placement results at schools, and the anecdotal accounts of
students and professors, a new pattern of occupational choice seems
to be emerging. Public service, government, the sciences and even
teaching look to be winners, while fewer shiny, young minds are
embarking on careers in finance and business consulting.
For the highest-paid business fields, the
outlook is for a tempering correction instead of an all-out exodus.
At Harvard, for example, about 40 percent of undergraduates in
recent years went into the most lucrative corporate arenas like
finance and consulting, based on surveys at the school year’s end.
“That certainly won’t be the case this year,” observed Lawrence
Katz, a professor and labor economist who has studied undergraduate
career choices at Harvard going back to the 1960s. “We’re seeing
students who would have been part of the Ivy League pipeline to Wall
Street in the past considering very different career paths.”
Kedamai Fisseha, a 21-year-old senior, is
one of them. An economics major, Mr. Fisseha says he always assumed
he would go into finance, and his summer internship last year was at
the investment bank Morgan Stanley. Yet after Wall Street’s
meltdown, job prospects there have withered. Instead, he is
interviewing with Teach for America, a nonprofit group that recruits
college graduates to teach in hard-to-staff schools for two-year
stints. (After that, only one-third stay in the classrooms, though
two-thirds remain in education.)
Mr. Fisseha regards the turn of events as
an opportunity to broaden his horizons. “It’s been liberating, and
lucky for me,” he said. “But your situation does dictate your
preferences.”
Graduate schools of government and public
policy are seeing a surge of applications. In a survey of its
members released last week, the National Association of Schools of
Public Affairs and Administration found that 82 percent reported an
increase in applications this year, and many saw the largest
percentage jumps in several years, or ever. The most-cited reason
was the expectation by students that government will be hiring.
Continued in article
Jensen Comment
In spite of continued strong career opportunities, with some of the best
opportunities for women, the above article ignores accountancy careers.
I think much of this is due to Lohr's focus on high ranked MBA programs.
These MBA Programs have not been major sources of public accountants in
the past three decades. One reason is that to take the CPA examination
most states requires more pre-requisite accounting course coverage than
top MBA programs make available in the curriculum. This makes it more
difficult for graduates of top MBA programs to sit for the CPA
examination unless they were undergraduate accounting majors. Top ranked
MBA programs like Harvard, Wharton, Stanford, and Darden generally
prefer to admit students who were not undergraduate business and/or
accounting majors.
Following the conflicts of interest charges and/or the Sarbanes-Oxley
legislation, most CPA firms sold off their consulting divisions like
Andersen Consulting, Cap Gemini, PwC Consulting, and KPMG Consulting.
Those divisions were more apt to hire MBA graduates who had no intention
of ever taking the CPA examination. Also consulting firms have cut way
back on their entry-level hiring in favor of hiring persons with
technical expertise and experience.
Although faculty in state-supported universities are somewhat
different from what we view as workers in the federal, state, and local
bureaucracies, there will be increased hiring opportunities for faculty
careers as the government pours upwards of a trillion dollars, over
several years, into education opportunities for lower-income students.
But with declining career opportunities as the private sector cuts back,
the outlook is not particularly strong for academic careers in schools
of business and accounting. It's even bleaker for undergraduate finance
programs. The outlook is much better for science and
medical/nursing/pharmacy faculty openings.
What I find somewhat sad in Lohr's article is the prediction that
government careers are the long-term wave of the future. I've never been
a fan of big public sector relative to the private sector. It's so sad
that Wall Street shot itself in the head rather than the foot!
Question
Why might you want to become a CPA?
A great reference summarizing
reasons is cited below. CPAs and non-CPAs frequently track into industry
and how accounting knowledge greatly enhances career advancement in most
instances:
STEPHEN R. MOEHRLE, GARY JOHN PREVITS, AND JENNIFER A. REYNOLDSMOEHRLE,
The CPA Profession: Opportunities, Responsibilities, and Services (New
York, NY: American Institute of Certified Public Accountants, 2006, pp.
xxii, 254).
This monograph provides a comprehensive overview of the scope of
services provided by CPA firms
Good News for Accounting Graduates: Hiring Outlook Remains Strong in 2008
--- http://accounting.smartpros.com/x60255.xml
College Business Students Cite Career Opportunities, Not Money, as Top
Criteria for Choosing Employer ---
http://accounting.smartpros.com/x59967.xml
SmartPros has an interesting site for students ---
http://accounting.smartpros.com/accountingstudents.xml
AccountingWeb Student Zone ---
http://www.accountingweb.com/news/student_zone.html
Accounting firms populate Working Mother top 100 list
Working Mother magazine has released its annual list of
the top 100 firms for working mothers, and this year, three of the Big Four
firms appear in the top 10. Among the top 10 firms are Ernst & Young, KPMG, and
PricewaterhouseCoopers. Deloitte isn't far behind at xx, and Grant Thornton and
RSM McGladrey also appear on the Top 100 list. Seven areas are measured and
scored in order to arrive at the top 100:
- Workforce profile
- Compensation
- Child care
- Flexibility Time off and leaves
- Family-friendly programs
- Company culture
- AccountingWeb, September 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=104048
The Working Mother online magazine link is at
http://www.workingmother.com/?service=vpage/106
Accounting firms dominate BusinessWeek's second annual ranking of the
"Best Places to Launch a Career."
From SmartPros, September 14, 2007 ---
http://accounting.smartpros.com/x59101.xml
Deloitte & Touche is No. 1, followed by
PricewaterhouseCoopers and Ernst & Young. The last of the Big Four,
KPMG, moved up four spots to No. 11.
Accountants used to be spoofed as bean
counters -- dutiful, middle-aged, gray-suited men with considerable
analytical expertise but little charisma. This year accountants
became sexy, BusinessWeek said in a statement.
Why did the accounting firms do so well?
Enormous demand. Across industries, there is a mad scramble to
recruit the best and brightest of a new generation, the
much-maligned, heavily scrutinized Gen Y. Nowhere is the pressure
more intense than in the Big Four. The Sarbanes-Oxley Act has so
greatly increased the need for their services that the firms are
facing an epic talent shortage.
BusinessWeek's "Best Places to Launch a
Career" ranking is based on three extensive surveys: of career
services directors at U.S. colleges, the employers they identify as
the best for new graduates, and college students themselves.
Some great information about the organization of major accounting
firms, their finances (including average partner comp) and litigation
---
http://thecaq.org/publicpolicy/treasurydata.htm
Accounting Majors are Hot, Hot
But two weeks into her final year, she had
lined up 15 interviews with the biggest firms in the country. Recruiters
treated her to trendy happy hours and fancy steak dinners, wooing her
with impressive salaries, free Cancun <http://www.washingtonpost.com/ac2/related/topic/Cancun?tid=informline>
vacations and irresistible sign-on bonuses. She
got three job offers in one afternoon."I had no idea it would be that
easy to find a job," said Piniuk, 23, who will start at Ernst & Young's
McLean <http://www.washingtonpost.com/ac2/related/topic/McLean+(Virginia)?tid=informline>
office in October.
The Washington Post,
Forwarded on July 6, 2007 by Don Ramsey.
2007 Salaries at Nation's Top Accounting Firms: Report ---
http://accounting.smartpros.com/x58940.xml
What's a CPA? Accountants take their show to YouTube
AccountingWeb, September 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=103999
Linda Kidwell forwarded this link ---
http://www.youtube.com/watch?v=9I502zLYZXU
David Albrecht forwarded this link (rap) ---
http://www.youtube.com/watch?v=xUcxvwAQ_n4
Large International Accounting Firm History ---
http://en.wikipedia.org/wiki/Big_Four_auditors
Demand for Internal Auditors Prompts IIA Textbook ---
http://accounting.smartpros.com/x58888.xml
Accounting Gets Hip—Companies Scramble for
Talent
It's got it all: great pay, generous benefits,
a fast career track and the respect of the highest executives in
corporate America. It's accounting, which is fast becoming one of the
most prestigious and in-demand careers around. Thanks to a spate of
corporate scandals and the flood of jobs created by the Sarbanes-Oxley
reform legislation, talented accountants are being wooed with raises,
bonuses and a long list of perks. Even those just starting out are being
recruited heavily. Accounting majors top the list of most desired job
candidates in the United States, according to the National Association
of Colleges and Employers. Graduates can expect to make $43,370 to
start, up from $40,538 in 2002. Some recruits get a month of paid
vacation, before their first day on the job, the Trenton Star-Ledger
reported. An accounting MBA can start at around $55,000, not counting
health insurance and retirement benefits.
"Accounting Gets Hip—Companies Scramble for Talent,"
AccountingWeb,
July 19, 2005 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=101107
Even the Top Ranked Business Schools are in a Crisis in 2008 (including a
slide show) ---
http://www.businessweek.com/magazine/toc/08_47/B4109best_business_schools.htm
Applications for MBA programs are up, but job opportunities for second-year
students in finance or consulting have turned wretched.
The scary part is that it will be a long, long time before finance and economics
students will have rising opportunities.
But accounting students fair well in rain or shine ---
http://accounting.smartpros.com/accountingstudents.xml
Bob Jensen's threads on careers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Bob
Jensen’s threads on the financial markets meltdown ---
http://faculty.trinity.edu/rjensen/2008Bailout.htm
Two States Partner to Offer New Student ePortfolios ---
http://www.convergemag.com/story.php?catid=421&storyid=108084
"Study: Higher education playing bigger role in gender wage gap,"
PhysOrg, August 9, 2009 ---
http://www.physorg.com/news169051532.html
While higher education has helped women
narrow their long-running wage gap with men, there is one
college-related factor that has becoming increasingly important in
perpetuating that gap, according to new research.
And that factor is college major.
Women are still segregated into college
majors that will lead them to careers with less pay than men, said
Donna Bobbitt-Zeher, author of the study and assistant professor of
sociology at Ohio State University at Marion.
"Gender segregation in college is becoming
more influential in how men and women are rewarded later in life,"
Bobbitt-Zeher said.
"If you really want to eliminate earnings
inequality, college major segregation is a piece of the puzzle that
really stands out."
The findings are especially important now
because many people assume that, if anything, college helps women
more than it helps men nowadays.
"A lot of people look at data showing that
women are more likely to go to college than men, and that women get
better grades in college than men, and assume that everything is all
right," she said.
"But this research suggests there are still
problems for women that relate to college."
Bobbitt-Zeher presented her research August
9 in San Francisco at the annual meeting of the American
Sociological Association.
She used data from the National
Longitudinal Study of the High School Class of 1972 and the National
Education Longitudinal Study of 1988. With these data sets, she was
able to compare women who graduated from high school in 1972 and
1992. She compared the incomes of college graduates seven years
after their high school graduations, in 1979 and 1999. Both samples
included about 10,000 cases.
Findings showed the income gap between
college-educated men and women declined significantly in 20 years -
in 1979, women's earnings were 78 percent of their male
counterparts, but by 1999 the women were earning 83 percent as much
as men.
Using well-accepted statistical techniques,
Bobbitt-Zeher estimated how much of that income difference between
men and women was explained by various factors in 1979 versus 1999.
Some of the factors she examined included occupations and industries
that men and women work in; background, including socioeconomic
status and race; how much individuals valued earning a lot of money;
factors related to parental and martial status; SAT scores; the
colleges that people attended and whether they earned graduate
degrees; and, of course, the percentage of women in their college
majors.
Findings showed that about 19 percent of
the income gap between college-educated men and women in 1999 could
be explained by their college major - nearly twice as much as in
1979, when 10 percent of the gap was explained by college major.
Although work-related characteristics
combine to explain a bigger share of the gap, no other single known
factor was more important than college major in explaining the
income gap in 1999.
In addition, college major is the only
factor explaining a substantial part of the income gap that
increased in importance between 1979 and 1999.
"What this suggests is that college major
segregation is becoming more important for wage inequality than it
used to be," Bobbitt-Zeher said.
Many college majors did become more
integrated between 1979 and 1999, she noted.
"Most of integration has come from women
making different choices, rather than men moving into traditionally
female fields," Bobbitt-Zeher said.
However, significant differences remain in
the majors women and men choose. And this is contributing to the
gender income gap in a more meaningful way than it did in the past.
The continuing wage gap isn't explained
completely by men choosing majors that require greater skills than
majors chosen by women, she said.
"Gender composition of majors is a stronger
influence on the gender income gap than is the content of the field
of study," according to Bobbitt-Zeher.
The reasons for the gender segregation of
majors are not entirely understood, she said. Personal choice could
play a role, or it could be that girls are still influenced to
pursue "women-appropriate" majors. Programs that encourage girls to
pursue scientific careers may be part of the answer.
But Bobbitt-Zeher said the results should
be a reminder for us not to believe gender inequality in higher
education is a problem of the past.
"There's been a lot of attention paid to
the fact that women seem to be doing so well in college compared to
men. But what people don't know is that education is playing a
bigger role than ever in perpetuating the gender income gap," she
said.
"It's an issue that we need to keep at the
forefront."
Bob Jensen's threads on gender and salary differences in higher
education
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#GenderSalaryDifferences
"Out of Work in Finance, They Turn to Teaching," by Mary Jo
Patterson, The New York Times, May 10, 2009 ---
http://www.nytimes.com/2009/05/10/nyregion/new-jersey/10tradersnj.html?_r=1&hpw
In March, the
State Legislature approved a pilot program that seemed tailor made for
her situation. Called Traders to Teachers, it is designed to turn
unemployed finance professionals into math teachers in three months.
Successful candidates, who are not required to have been math majors,
will attend classes free at Montclair State University.
The response to
the program has been overwhelming. Within 48 hours of its unveiling, 200
people called or e-mailed; at least 100 are expected to apply for the
first class of 25, according to university administrators. Besides Mrs.
Marshall, those who responded include Pedro Ramirez, 48, of Cranford, a
Goldman Sachs executive let go in February 2008; Robert Stanley, 50, of
Basking Ridge, a 26-year Wall Street veteran out of work since October;
and Tony Malanga, 46, of Verona, a mortgage banker who lost his job in
March.
“Things collapsed
to such an extent in financial services, it’s going to take years to get
back to normalcy,” said Mr. Malanga, a father of six. “It’s a good point
for me to transition into a new career. Teaching was always something I
wanted. In your late 40s, after coming through this, you care more about
stability than building wealth.”
Since December
2007, New Jersey’s financial services sector has shed 16,000 jobs, said
David J. Socolow, state commissioner of labor and workforce development.
Thousands of other residents lost similar jobs in New York.
Traders to
Teachers, financed by a federal grant, will do more than retrain
dislocated workers, Mr. Socolow said, it will also ease the state’s
shortage of math teachers.
Ada Beth Cutler,
dean of the College of Education and Human Services at Montclair State,
said the idea came to her and Lucille E. Davy, New Jersey’s education
commissioner, last fall.
“She called me
and said she was hearing about all the people being laid off from
financial services,” Dr. Cutler recalled. “She said, ‘Don’t you think
these people would make great math teachers?’ I said, ‘That’s funny you
should ask, because we’ve been getting calls from them about this.’ ”
Most of the
callers had majored in finance or accounting. When they learned they
needed 30 college credits in mathematics, she said, they were dismayed.
Special
legislation was introduced to ease that rule and fast-track
certification.
“That does not
mean we will compromise our standards,” Dr. Cutler said. “We will take
very bright people and, through a very intensive program, teach them the
mathematics they need to know and how to teach it.”
The first 25 of
the newly trained teachers are expected to be placed in teaching
positions in January. Three more groups are expected to be trained
within a year, Montclair State administrators said.
Continued in article
Even the Top Ranked Business Schools are in a Crisis in 2008
(including a slide show) ---
http://www.businessweek.com/magazine/toc/08_47/B4109best_business_schools.htm
Applications for MBA programs are up, but job opportunities for
second-year students in finance or consulting have turned wretched.
The scary part is that it will be a long, long time before finance and
economics students will have rising opportunities.
"The
Forensics Behind Accounting," The Atlanta Journal-Constitution via
SmartPros, August 26, 2009 ---
http://accounting.smartpros.com/x67450.xml
He started using numbers to track wrong-doing back in 1983, when the FBI
hired him and a slew of other able-brained accountants to sort through the
savings-and-loan mess.
Now Berecz, director of Georgia Southern University's Center for Forensic
Studies in Accounting and Business, helps college students gain the skills
to sort through the debris of today's financial industry meltdown.
"Our course work is so close to practical application," says Berecz, a
licensed polygraph examiner who teaches one class with the tough-guy title
"Forensic Interviews and Interrogations."
"Forensic accounting permeates through all of those other categories of
accounting," Berecz says.
Q: Why do you think white-collar crime has been so prevalent over the
last 10 years?
A: The amount of money. No one ever thought a Ponzi scheme could reach
the level of Madoff.
Q: Which is harder to detect, fraud within a corporation, like Enron, or
fraud by an investment adviser, like Bernie Madoff?
A: Most detection of fraud comes because someone tells us about it.
Without a whistle-blower, there's not a clear answer.
Q: Do you think additional regulation of the financial sector will help
forensic accountants? Will it create more of a paper trail, for example,
that will be easier to track?
A: I think it [increased regulation] is inevitable because we learn from
our mistakes. It will cost more, but it is worth it for the good of the
whole.
Q: But do you think it will help solve white-collar crimes?
A: I think what it will show is the intention of people committing crimes
earlier. That's what I think the regulation will do. Small frauds that go
undetected become larger frauds. It will help detect them earlier.
Q: What red flags of fraud should every investor know to look for?
A: Anyone who contacts you and tells you that they've got a guaranteed
investment with a high return, that is the No. 1 red flag.
And if there's some urgency and secrecy around it, if they say they
are doing it just for you, that's a major red flag.
Q: How are you preparing students to detect fraud?
A: One example is our students take a course called 'Micro Fraud
Examination.' We take them through 40 to 50 fraud schemes . . . Most of the
people who perpetrate these frauds think they are doing something that has
never been done before. But the reality is, they keep repeating schemes that
have happened before.
Q: One of the classes at Georgia Southern teaches the verbal and
nonverbal cues indicating truth or deception. What's one of the best clues
that someone is lying?
A: The general rule of thumb is they're just uncomfortable. Eye contact
is just not right . . . When you lie, you have to be creative, use that part
of the brain, so when you lie you have to visualize the lie, and you look up
and to the right. That is a theory . . . Also, it may be nanoseconds, but it
takes a person six times longer to answer a question with a lie than to
answer it truthfully.
Q: How many forensic accounting programs are there like the one at
Georgia Southern?
A: Only four offer 10 or more forensic accounting classes: Utica College
in New York; Stevenson University [near] Baltimore; Florida Atlantic
University and us. In academia, we don't call them competitors, we call them
peers.
Q: What do you foresee as the next trend in white-collar crime?
A: Technology. Cybercrimes. I think it behooves us here at Georgia
Southern to make sure our coursework continues to evolve with these
cybercrimes.
Jensen Comment
Various colleges and universities have added concentrations on forensic
accounting.
Georgia Tech in Atlanta has a rather unique
Financial Reporting and Analysis Lab that is not so much into forensics
at a micro level but is definitely into fraud detection using financial
statements ---
http://mgt.gatech.edu/fac_research/centers_initiatives/finlab/index.html
Hi Dennis,
I do not have direct answers to your specific questions. However, I did
combine two tidbits that may be of interest to you and to other subscribers
to the AECM. These specialty certifications are commonly held by persons
seeking to be paid for expert witnessing. In my opinion, there's a lack of
accountability of most of these so-called "certificates" and the
organizations that grant such certificates.
On the other hand, there's also merit in some of the complaints by these
associations directed at our most respected colleges and universities. For
example, most college accounting programs teach about valuation accountics
science models (such as residual income and free cash flow models) that are
typically more misleading than helpful when it comes to real world valuation
of business firms. It's not common to find college professors who have a
history of outstanding professional experience in valuation or forensics.
College curricula in accounting and finance are terribly lacking in courses
and research professors knowledgeable about the professions of valuation or
forensics. For example, most of our auditing courses spend more time
stressing how financial audits are not designed to detect fraud rather than
becoming professionally focused on ways to detect fraud. We do have course
modules on internal controls, but these typically are very superficial
relative to what graduates will encounter in the real world of fraud and
systems weaknesses.
The bottom line is that both valuation and forensics are topics that are
poorly covered at the university level. And coverage by mysterious
associations offering certificates do not always pass the smell tests of
credibility.
The National Association of Certified Valuators and Analysts (NACVA)
---
http://www.nacva.com/
Business Valuation Standard ---
http://en.wikipedia.org/wiki/Business_valuation_standard
Business Valuation Standards (BVS) are codes of
practice that are used in
business valuation. Each of the three major United States valuation
societies — the
American Society of Appraisers (ASA),
American Institute of Certified Public Accountants (CPA/ABV), and
the
National Association of Certified Valuation Analysts (NACVA) — has
its own set of Business Valuation Standards, which it requires all of
its accredited members to adhere to.[1]
The AICPA's standards are published as
Statement on Standards for Valuation Services No.1 and the ASA's
standards are published as the ASA Business Valuation Standards.
All AICPA members are required to follow SSVS1. Additionally, the
majority of the State Accountancy Boards have adopted SSVS1 for CPAs
licensed in their state.
Criticism of the abovementioned
organizations are as follows:
1) These are neither the major
valuation societies, nor are they the only valuation societies. They are
however, organizations which engage in considerable self-promotion among
their members to foster the delusion among their members, that by the
mere fact of membership, their members are more qualified to perform
business appraisal than non-members.
2) These are all privately held organizations, in which membership is
voluntary.
3) There are no regulations mandating that one must belong to any of
these organizations in order to practice as a business appraiser.
4) In that these are voluntary membership organizations, their standards
have little or no weight with either the business valuation community at
large or with the legal and judicial community who appraisers often
serve.
5) The standards and ethics of these organizations are constructed to be
vague and self-serving, with numerous exceptions, designed more to
excuse conflicts of interest, membership poor performance and
unsupported opinion, than to encourage, independence, scientific
analysis and high quality work. Conflicts of interest are a problem,
particularly among CPA/Appraisers, who regularly join these
organizations so that they can offer valuation services to their
existing accounting clients, in violation of independence rules and
ethics.
6) The education which these organizations offer is unaccredited and of
low quality, in that it does not reach the threshold level of education
in finance of an accredited university.
7) Educational standards have to be kept low to attract new members and
membership dues.
8) The credentials which these organizations issue are often issued for
reasons of favoritism and cronyism over merit.
9) The purpose of these organizations is often tarnished by the politics
of a few active, insider members who consider themselves more entitled
then other members, and consequently use the organization resources to
further their own self-interests over the interests of the membership at
large.
10) There is no accounting of the membership dues paid into these
membership organizations. Consequently, members do not know where, to
whom, or on what their dues money is spent.
Forensic Accounting ---
http://en.wikipedia.org/wiki/Forensic_accounting
American College of Forensic Examiners International (ACFEI) ---
http://www.acfei.com/
The ACFEI is mulit-disciplinary, only one discipline of which is accounting
Association of Certified Fraud Examiners (ACFE) ---
http://www.acfe.com/
The ACFE is more focused in on accounting and business fraud than the ACFEI
Other Forensic Associations ---
http://www.hgexperts.com/forensic-science.asp
To my knowledge, the only AACSB-accredited university to offer a forensic
accounting certificate is the University of West Virginia ---
http://www.be.wvu.edu/fafi/index.htm
There are also tracks for forensic accounting in the Masters of Public
Accounting Degree curriculum.
"Forensic Accounting And Auditing: Compared And Contrasted To
Traditional Accounting And Auditing," by Dahli Gray, American Journal
of Business Education, Volume 1, Number 2, 2008 ---
http://scholar.googleusercontent.com/scholar?q=cache:lnY92RzjASgJ:scholar.google.com/+ACFE+ACFEI+"lawsuit"&hl=en&as_sdt=0,20
Forensic versus traditional accounting and
auditing are compared and contrasted. Evidence gathering is detailed.
Forensic science and fraud symptoms are explained. Criminalists, expert
testimony and corporate governance are presented.
NASBA 2008 Update: 120 Versus
150-Credit Hour Requirement to Sit for the CPA Examination
There are now only two states that do not require 150-credits to sit for the CPA
Examination, with California being the largest jurisdiction
DRAFT Education and Licensure
Requirements for Certified Public Accountants: A Discussion Regarding
Degreed Candidates Sitting for the Uniform CPA Examination with a
Minimum of 120 Credit Hours (120-Hour Candidate) and Becoming Eligible
for Licensure with a Minimum of 150 Credit Hours (150-Hour Candidate)
(120/150 Discussion), Issued by the National Association of State Boards
of Accountancy (NASBA) , November 2008 ---
http://snipurl.com/150nasba [www_nasba_org]
http://www.nasba.org/862571B900737CED/318CD757B9F57F75862574FA00763F36/$file/120_150_Paper_Draft_November_08.pdf
The above draft has quite a lot of data
and provides extensive history of the 150-Hour Rule.
For a wider history see
http://en.wikipedia.org/wiki/Uniform_Certified_Public_Accountant_Examination
Part of the above Wikipedia module was out of date, so I changed the
Wikipedia module on December 13, 2008.
NASBA
has some learning tools at
http://www.nasbatools.com/display_page
Free CPA Examination Review
Course ---
http://cpareviewforfree.com/
AccountingWeb Student Zone ---
http://www.accountingweb.com/news/student_zone.html
For many students, the fee-based CPA
Examination Review materials and courses are likely to get better
results, especially those that force students to weekly stay on track
and those that have multimedia helpers and those that meet onsite as a
regular class.
-
Accounting Institute Seminars
Becker CPA Review
Bisk-Totaltape CPA Exam Review
Conviser Duffy CPA Review (now merged with
Becker)
CPA Review Twin Cities
CPAexcel CPA Exam Review
Dynasty School
Gleim Publications
Hoyle CPA Ventures
(now free)
Intensive CPA Examination Review
Kaplan
Lambers
Mark's CPA Review
MicroMash
Person/Wolinsky CPA Review Courses
Rigos Professional Education
The Tutorial Group, Inc.
Wiley CPA Exam Review
Wise Guides
Question
Did Harvard and Wharton (Penn) kill the traditional MBA job market?
Answer
No doubt! Now the hot opportunity is a job with the Federal Government.
"MBAs: Uncle Sam Wants You: With the private sector job market
more dismal than ever, suddenly government and nonprofit jobs are some
of the hottest tickets around," by Anne VanderMey, Business Week,
February 16, 2009 ---
http://www.businessweek.com/bschools/content/feb2009/bs20090216_831796.htm?link_position=link1
At the McCombs School of Business at the
University of Texas at Austin on Feb. 9, dozens of students crowded
a classroom for an evening career workshop, breaking an attendance
record. The scene was typical of B-school campuses across the
country—with jobs in short supply, recruiters are finding themselves
more courted than ever. What was different, though, was that this
wasn't an event for investment banking, management, or even
consulting. It was a pitch for nonprofit and government work.
Uncle Sam has never been very popular with
MBA graduates, most of whom are accustomed to the hefty signing
bonuses and competitive salaries in private industry. But with the
U.S. shedding hundreds of thousands of jobs each month, many
companies freezing wages, and an MBA job market turning more dismal
by the minute, the stability of government is starting to look a lot
more appealing.
At McCombs, Director of MBA Career Services
Stacey Rudnick said 70 people came to a workshop called "MBA Jobs
You've Never Considered," the largest turnout in recent memory for a
spring career workshop. Usually, by this time of year, students
already have jobs lined up. "Students are looking for every
opportunity, every bit of new information that might help them
extend or broaden their search," Rudnick said
Continued in article
From the Scout Report on May 22, 2009
- Survey reveals best places to work in the federal government Strong
Managers Ranked More Important Than Money in Federal Workplace Survey
http://www.washingtonpost.com/wpdyn/content/article/2009/05/19/AR2009051903621.html
OMB to use workplace rankings in 2011 budget process
http://www.govexec.com/dailyfed/0509/052009ar1.htm
Survey says NRC is still the best place to work in government
http://federaltimes.com/index.php?S=4097105
The Best Places to Work in the Federal Government 2009
http://data.bestplacestowork.org/index.php/bptw/index
FORTUNE: Best Companies 2009
http://money.cnn.com/magazines/fortune/bestcompanies/2009/
Bright Ideas: Pink Slip Parties
http://www.boston.com/business/globe/globe100/globe_100_2009/bright_ideas_pinkslip/
Definition of Millenials (Generation Y or Net Generation) ---
http://en.wikipedia.org/wiki/Millennials
"The Millennials Invade the B-Schools: They're pursuing MBAs
to change the world, but first they're forcing business schools to make
changes in order to accommodate them," Business Week,
November 13, 2008 ---
http://www.businessweek.com/magazine/content/08_47/b4109046025427.htm?link_position=link2
Best International Business Schools According to Business Week
---
http://images.businessweek.com/ss/08/11/1112_best_international_business_schools/index.htm?link_position=link5
Controversies in College Rankings ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#BusinessSchoolRankings
Helpers for career growth (podcasts) ---
http://www.streetiq.com/
Free CPA Review Course ---
http://cpareviewforfree.com/
"Life in the Big Four: Pranks," AccountingWeb, December 2008
---
http://www.accountingweb.com/cgi-bin/item.cgi?id=106619
As long as there are interns and new hires,
there will be pranks. Some pranks are timeless, and incredibly
clever. There's a famous prank to play on new audit hires/interns. A
senior (or manager) sends the unsuspecting kid into the CFO's office
asking for a "bag of tickmarks."
This inside joke is
HILARIOUS.............assuming you were born in the 1920s and have
the sense of humor of a dead hamster. This is not an example of a
timeless and/or clever joke. If I wanted to laugh this hard, I would
have crashed an eight-year old's birthday party and listened
intently to the Knock-Knock jokes.
Interns will do whatever you tell them, as
long as they believe it will get them a job offer. Wasting it on a
bad joke that was out-of-date when the CFO was in high school is not
the way to use this wonderful gift. The best jokes, in fact, are the
ones that the intern never realizes are jokes.
Consider, for example, the following
conversation.
"Dammit."
"What's wrong, Anonymous Senior?"
"These idiots repaved the parking lot, and
capitalized the whole damned thing. We didn't cover this in our
fixed asset testing."
"Is there anything I can do to help?"
(translation: Is there anything I can do to get a job offer?)
"Well, a parking space covers about 30
square feet, and they said they paved 5000 square feet. It would be
great if you could go out and count the parking spaces so that we
could figure out roughly how much was actually paved."
The result: Intern spends four hours
counting 200 parking spaces, and often ends up thinking he did
something constructive.
Everyone is a big winner.
The best office jokes, of course, are
played on those who have no inherent ability to cope with the
emotional fallout.
Myself and another senior were at a client
once with an IT audit senior. My friend and I went to lunch, and
returned to find an open text document on each of our computers,
reading "IT Security is serious business. Lock your computer when
you leave or I will report you to the National Office."
The IT Audit Senior had decided to play
vigilante.
Both my co-senior and I were slightly
offended, because IT people were rarely allowed to interact with
clients. This business trip, we decided, was a privilege for IT Guy,
not a right.
In the words of the Senior George Bush,
"This aggression would not stand."
The next time IT guy went to the restroom,
he did not lock his computer. IT security is SERIOUS BUSINESS,
DAMMIT!!!
To demonstrate how serious, we sat at his
computer and activated a little known feature of Microsoft Word: the
customizable area of Autocorrect.
This deserves some explanation.
You know how, if you type "auidt" instead
of "audit," and Bill Gates often works some magic and fixes the typo
for you automatically? Well, the list of common typos that Word uses
can be edited. In fact, it can be edited to the point where your
name, or your firm's name, can be considered a typo by Word and
replaced with any vulgar word of your choosing.
For example, suppose IT Guy's name was
Fred. You can tell Word that "Fred" is a typo, and should be
replaced with a word like "Slut." Whenever IT Guy types his name,
Word automatically replaces it with the word "Slut."
As there are countless "common" words used
in everyday Big4 life, and countless vulgar words in the English
language, one can have infinite amounts of fun with this trick.
Later that day, IT Guy typed a memo on Word
and e-mailed to his boss without manually proofreading it.
He was never heard from again.
* This is the second in a series
of reminiscences about life in the Big Four accounting firms. The
author has asked to remain anonymous.
Aug. 12, 2008 (SmartPros) — Eric Fox, an accounting graduate of California State
University, Los Angeles, has been awarded Beta Alpha Psi's
first Medal of Inspiration Award ---
http://accounting.smartpros.com/x62867.xml
xTREME Accounting Games from PwC
PwC launched the xTREME Games in 2002, to increase
students' exposure to professional services and the world of public accounting.
Since then, the games have grown substantially with over 85 schools involved,
more than 2,500 teams comprising 13,000 participants, and 1.5 million in prize
money awarded. Over the years, more than 150,000 hours have been logged to the
xTREME Games by competing students. The xTREME Games continue to have a
significant impact on our participants, helping them to better understand the
vast career opportunities in public accounting and connecting them with
professionals in the industry. The characteristics that winning teams exhibit
are critical thinking, presentation skills, teamwork, and using time wisely
---
http://www.pwc.com/us/en/careers/xtreme/what-it-takes.jhtml
"PRICEWATERHOUSECOOPERS LAUNCHES NATIONWIDE COMPETITION TO ENHANCE
CAREER READINESS OF COLLEGE STUDENTS," by Andrew Priest, Accounting Education News, September 10, 2009 ---
http://accountingeducation.com/index.cfm?page=newsdetails&id=150210
As college students across the country
continue to face a highly competitive job market,
PricewaterhouseCoopers LLP (PwC) has announced the launch of the
firm's 8th Annual xTREME Games, a unique competition that enables
undergraduates at schools across the country to experience and solve
real-world business challenges. Participants in PwC's xTREME Games
compete for school bragging rights and nearly $300,000 in total
prize money while broadening and enhancing valuable skills such as
decision making, communication and team building, which are critical
to success in the professional world. Approximately $1.5 million in
total prize money has been awarded to students since xTREME began.
As one of the nation's largest employers of
college graduates, PwC collaborates with schools across the country
to provide meaningful, relevant learning programs and opportunities
to ensure that students are well prepared to enter the profession.
The xTREME Games competition is part of PwC's larger, ongoing
commitment to corporate responsibility and youth education.
xTREME, beginning this week at the
University of Alabama, includes xTAX, short for "Extreme Tax," and
xACT, short for "Extreme Accounting." Both challenge undergraduates
to solve cases designed to expose them to real tax and accounting
scenarios, including policy and planning issues. Over the next six
weeks, hundreds of the best accounting students representing nearly
80 schools nationwide will compete in five-person teams for the
right to potentially represent their schools at the national finals
in January.
"When it comes to preparing students for
successful careers in the accounting profession, there is no
substitute for hands-on, real-world experience," said Christina
Fitzpatrick, National Campus Sourcing Programs Leader for
PricewaterhouseCoopers. "With the xTREME Games, students get a
firsthand look at the type of intricate challenges that tax and
accounting professionals face on a daily basis. The competition
builds collaboration and problem-solving skills while also requiring
that ideas are effectively presented -- all crucial skills in a
competitive job environment."
Created by PwC in 2002, the xTREME Games
competition has grown steadily to include nearly 80 schools and more
than 2,500 teams comprised of 13,000 participants. More information
about xTREME can be found at www.pwc.com/xtreme.
PwC has a strong history of investing in
education and talent development. For the past two years, PwC has
been ranked #1 in Training magazine's "Training Top 125" annual
ranking of organizations that excel at employee training and
development (the firm also ranked #2 in 2007). PwC has also
consistently been named to FORTUNE magazine's "100 Best Companies to
Work For" list, and has been highly ranked on BusinessWeek's lists
of "Best Internships" and "Best Places to Launch a Career."
Also see "EXTREME-ACCOUNTING: ACCOUNTANTS' (in Wales) WACKY RACES"
---
http://accountingeducation.com/index.cfm?page=newsdetails&id=137526
The PwC xTreme Games Site ---
http://www.pwc.com/us/en/careers/xtreme/index.jhtml
Have you got the right stuff?
Business is the place where theory is
executed in real time. It's a place where decisions are made with
consequences, where communication is key, and collaborative,
team-oriented thinking is a must. These are the conditions created
in the xTREME Games, PwC's Tax and Accounting Campus Competitions.
No longer within the safe confines of the
classroom, PwC seeks students who are eager to plunge briefly into
the environment of the real business world to show what they're made
of as critical thinkers, able collaborators and persuasive advisors
on important business issues.
No number crunching exercises, the xTREME
Games are focused on high-level issues designed to test and improve
your decision-making skills. Detailed accounting or tax knowledge is
not required to participate. What is required is your desire to
learn, meet new people, experience new challenges, and have fun!
Our 2009 xTREME campuses are designated for
either the xACT competition OR the xTAX competition. Read on for
more information about how it works, what it takes to succeed, and
to see if your school is a participant!
Build your team ---
http://www.pwc.com/us/en/careers/xtreme/how-it-works.jhtml
Find your five-member team. Two must be
sophomores—each must be enrolled in the first accounting course or
be an accounting major/minor One junior—must be an accounting major
One “other” team member may be at any level: freshman to fifth year
student. This team member does not have to be an accounting major,
e.g., a general business or business-related major, such as Finance
or Information Systems is acceptable. One team member can be any
level but must either be enrolled in the first accounting course or
be an accounting major/minor at the undergraduate or graduate level.
3 Attend official mission meeting on campus
In your mission meeting, you and your
teammates will meet with PwC representatives to receive your
official case packet, with instructions and further information
about the xTREME Games. 4 Develop your case
You and your team will have two weeks to
develop your case and consult with your faculty and PwC mentors for
guidance and encouragement along the way. The average time it takes
a team to complete the case assignment is 10-15 hours. 5 Present
your case in 12 minutes to PwC professionals
Your team will be charged with clearly
communicating your position, presenting in a dynamic way, and
backing up your case solution in an interactive question and answer
session. Each team member must speak for at least one minute. 6
Celebrate!
All participants will receive an invitation
to a PwC celebratory event following the competition where they’ll
have an opportunity to network with our professionals. The winning
team on each campus will receive $1,000 and consideration for the
national finals. 7 Five lucky winners to compete in the national
finals
Five teams will be chosen as national
finalists and awarded $10,000 per team and a trip either to New York
City (xACT) or Washington, D.C. (xTAX). There, each team will get a
chance to join with experts from PwC for a fun-filled, exciting
two-day final competition. Winners of the xACT competition receive
our prestigious Montgomery Award, while winners of the xTAX
competition receive our prestigious Hamilton Award. The xACT
Montgomery Award
Named after Robert Montgomery, founding
partner of Lybrand, Ross Brothers & Montgomery in 1898, who wrote
the first American book on the practice of auditing. He was
instrumental in the founding of the AICPA and served as its first
president.
The award, a silver bowl, resides at PwC
headquarters in New York City.
Names of each member of the winning team
are inscribed on its base. Each winning team member and their
faculty mentor receive a replica of the award to keep. The xTAX
Hamilton Award
Named after Alexander Hamilton, the first
Secretary of the US Treasury, who set the first tax policy and
defended it in a decision that was the Supreme Court's first ruling
on the constitutionality of a law.
The award, a silver bowl, resides at PwC's
Washington National Tax Service office in Washington, DC.
Names of each member of the winning team
are inscribed on its base. Each winning team member and their
faculty mentor receive a replica of the award to keep.
Home How it works What it takes Who's
competing Winner's circle Register now Recently visited pages xTREME
Games: PwC's tax and accounting competition
Bob Jensen's threads on tools and tricks of the trade (including
games and other forms of edutainment) in education are at
http://faculty.trinity.edu/rjensen/000aaa/thetools.htm
"Texas CPA Society wins national award for student Web site,"
AccountingWeb, August 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=105766
Texas Society of
CPAs (TSCPA) was awarded a 2008 Gold Circle Award from the American
Society of Association Executives (ASAE) & The Center for
Association Leadership. The award recognizes innovative ideas and
achievement in association communication campaigns. TSCPA was given
the Gold Circle Award in the micro-web site category, for its
interactive student site Destination CPA.
Selected from a
record 373 entries representing 248 organizations, 19 associations
were recently honored with a 2008 Gold Circle Award. Recipients were
chosen for demonstrating excellence in communications in the
categories of print publishing, writing, electronic publishing,
media relations and emerging communication vehicles.
Destination CPA
maps out the route to becoming a
certified public accountant for both high school and college
students. Teachers are also welcome to come along for a ride, where
they can find links to classroom resources like lesson plans, career
videos and more.
About TSCPA
TSCPA
is a nonprofit, voluntary,
professional organization representing Texas CPAs. The society has
20 local chapters statewide and has 28,000 members, one of the
largest in-state memberships of any state CPA society in the United
States.
About ASAE & The Center for
Association Leadership
ASAE & The Center for Association
Leadership foster a learning community of association professionals,
industry partners, outside thought leaders, and others.
The American Society of
Association Executives is an individual membership organization of
more than 22,000 association executives and industry partners
representing more than 11,000 organizations. Its members manage
trade associations, individual membership societies, and voluntary
organizations across the United States and in 50 countries around
the globe.
The Center for Association
Leadership is a provider of learning, knowledge, and future-oriented
research for the association profession. The Center delivers
learning experiences, performance-enhancing resources, opportunities
for peer-to-peer collaboration, and strategic tools and data
designed to advance the association profession.
ASAE Services Inc. - ASAE's wholly
owned subsidiary - is a source of business products and services for
the association community.
"IMA Looks to Redefine 'Management Accounting'," SmartPros, August 13,
2008 ---
http://accounting.smartpros.com/x62882.xml
The Institute of Management Accountants
is seeking input from its members on a proposed new definition of
the term "management accounting."
In the August
2008 issue of Strategic Finance magazine, IMA published a
draft "statement of management accounting" proposing a new
definition "to more accurately reflect what management accountants
do and aspire to become."
The
proposed new definition is:
Management accounting is a professional discipline that has an
integral role in formulating and implementing the organization's
strategy. Management accountants are part of the management
team, working within the organization at many levels: from
top-level management to support-level accounting and finance
professionals. Management accountants apply their knowledge and
experience in accounting and financial reporting, budgeting,
decision support, risk and performance management, internal
control, and cost management.
IMA said
that the field of management accounting has evolved considerably
since the first and current definition was published in 1981.
"For more
than a decade, IMA has supported and participated in research that
calls for a change in point of view, shifting from a transaction and
compliance orientation to becoming a strategic business partner,"
IMA states on its Web site.
Comments and
suggestions are due Sept. 10. For more information:
http://www.imanet.org/newsletter/ions/ma_exposure.asp
ALPFA: The Association of Latino Professionals in Finance and
Accounting offers career and community resources ---
http://www.alpfa.org/
Video: Careers in Insurance and Risk Management
Bill Hammond spoke to my class last week on
careers in insurance and risk management. It was very good. If you only
want audio of it, that is available
here.
If you want to see the powerpoint
slides, they are available
here.
Jim Mahar, "Bill Hammond's presentation to my classes"
FinanceProfessor
Blog, May 4, 2009
Watch the video at
http://financeprofessorblog.blogspot.com/2009/05/bill-hammonds-presentation-to-my.html
Updates: Deloitte's Initiative for advancement and retention of female
professionals
From Smart Stops on the Web, Journal of Accountancy, July 2008
HER SIDE OF THE
STORY
Deloitte’s Women’s Initiative (WIN) Blog,
part of the firm’s program for advancement
and retention for female employees, is an
“ongoing community conversation about life,
work, and everything in between.” Recent
posts are listed down the right side of the
home page, and cover topics such as
work/life balance, the generation gap,
mentors, office politics and life lessons.
An active group of readers—who include both
men and women—give feedback, commiserate or
just share their related experiences in the
comments below each blurb. You can also
subscribe to the RSS feed to keep up with
the latest posts. |
|
Women Partners in the Big 4 Accounting Firms
For the tenth consecutive year, Deloitte & Touche USA
LLP tops the Big Four accounting firms in percentage of women partners,
principals and directors, according to Public Accounting Report's 2006 Survey of
Women in Public Accounting. The survey revealed that Deloitte's percentage of
women partners, principals and directors is currently 19.3 percent, surpassing
that of KPMG (16.8 percent), Pricewaterhouse Coopers (15.8 percent) and Ernst &
Young (13.5 percent). Deloitte has held this lead every year since the inception
of the survey in 1997, according to Jonathan Hamilton, editor, Public Accounting
Report.
SmartPros, December 26, 2006 ---
http://accounting.smartpros.com/x55948.xml
Women now make up more than 60 percent of
all accountants and auditors in the United States, according to the
Clarion-Ledger. That is an estimated 843,000 women in the accounting and
auditing work force.
AccountingWeb, "Number of Female Accountants Increasing," June 2,
2006 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=102218
Jensen Comment
Nearly 20 years ago, Deloitte embarked on a "Women's Initiative" to
help female employees break the glass ceiling ---
http://www.deloitte.com/dtt/section_node/0,1042,sid=2261,00.htm
"Women to CPA Firms: I Quit!" by Joanne Cleaver, BNET, June 14,
2010 ---
http://blogs.bnet.com/management/?p=1594&tag=content;col1
Thank you Roger Collins for the Heads Up!
I’m no number cruncher, but even I can see
that something’s out of line here:
- Women earn 51 percent of accounting
undergrad degrees
- Women are 51 percent of employees at
public accounting firms
- Women are 17.4 percent of accounting
firm partners
Organizations like
Catalyst and the
American
Institute of Certified Public Accountants have long lamented that women aren’t making partner. They’ve trotted
out the predictable bromides: flexible work schedules, more
mentoring, and more female role models. But none of that actually
targets the crux of the problem: At what point, exactly, do women
quit? Why do they leave? And what can firms and women do about it?
Recently, the two associations for women in
accounting — the
American Society of Women Accountants
and
the
American Women’s Society of CPA’s
— teamed
up with my research firm to find out. We released the first
Accounting MOVE Report on April 15 (for a
little tax-accountant humor). Our top-line recommendation: With one
program, firms can retain women to partnership and immediately gain
clients and revenue.
Really? More money now and more women in
the long run?
Yes. Here’s how: concentrate business
development training at the level where women are most likely to
quit. For most firms, that’s at the senior-manager level — the step
right before partner. Our study of 20 firms found that women are 50
percent of all managers but 40 percent of senior managers. At firms
with directors, women accounted for 33 percent. And from there, it
was a dizzying drop to 17.4 percent of partners. (By the way, that
17.4 percent is in line with previous research.)
Here’s what we found at that crucial senior
level: Women promoted to senior manager suddenly realize that to
make that final big step to partner, they must bring in clients. But
guess what? They didn’t get into accounting to be salespeople — at
least, that’s what dozens of women told us. But partners must make
rain. And senior managers must learn to seed the clouds. This is
such an unsettling prospect to many female senior managers that
they’d rather defect to the corporate world where, they believe,
they won’t be under the gun to bring in business.
Three years ago New Jersey CPA firm
Rothstein Kass
realized that this
was a killer dynamic. Now RK has a constellation of training tools
for senior women poised for partnership. “Rainmakers Roundtable”
first coaches each woman to articulate her own approach to drawing
in new clients. When you hear yourself say it, you own it. Then, the
program alternates between three sales-skills workshops and three
networking events. Each networking event puts into play the newly
learned skills. By the last event, the RK women are networking with
senior women at law firms and investment firms.
RK principal Rosalie Mandel
has been the poster girl for many of the firm’s initiatives to
advance women. A decade ago, when she had her first child she
forged a part-time, principal-track schedule. It worked out so well
that the managing partners asked her to lead the firm’s innovations
in work-life and advancing women. She was named principal partly on
her successes in those arenas.
Mandel says that because intense career
advancement typically overlaps with intense family responsibilities,
it’s incumbent on firms to clear the internal path so that rising
women can tackle career-derailing issues. “Men have that natural
camaraderie,” she says. “You see that the men who golf with the big
guys get pulled forward a little faster. Women don’t have that. Who
has time? You come in to work, and you work hard so you can get
home.”
The Rainmakers Roundtable helps make up for
time spent at school plays rather than after-dinner drinks. Women
learn exactly how to ask for a high-level referral. They forge
alliances with similarly situated women in law and investment
banking firms, with the shared goal of recruiting new clients
together, for all. They polish their personal elevator pitches.
Partly due to the Roundtable, fully half of
Rothstein Kass directors are women. That should translate to a
healthy lift in women partners — now an unimpressive 10 percent —
with the next round of promotions.
New clients = more revenue. Rainmaking
women = qualified potential partners. And that’s how to move the
numbers at accounting firms.
What parallel dilemmas challenge women in
your industry? Could the Rainmakers Roundtable be adapted to the
particular challenges facing upper-middle management women in your
company?
The AAA Commons has a hive on Diversity ---
http://commons.aaahq.org/pages/home
Search Accounting Jobs - FREE! ---
http://www.searchaccountingjobs.com
The above site is, however, a commercial site.
"MBA Moms Most Likely to Opt Out: A new study finds MBA moms more likely
than doctors or lawyers to stay home full-time," by Alison Damast, Business Week, August 25, 2008 ---
http://www.businessweek.com/bschools/content/aug2008/bs20080821_739321.htm
Shortly after graduating from Harvard
University in 1988, Lydia Icke dived into a high-powered career as
an investment banker at Citibank (C). An ambitious undergraduate,
she snapped up one of the hardest jobs she could find, she said.
"And I was right, it was the hardest job I
could find," said Icke, who later went on to Harvard Business School
to get her MBA. "I worked all night and on the weekends and had all
the tombstones [ads that appear in financial publications following
a deal] to prove it."
Twenty years and four kids later, Icke is
far removed from the pressure and deadline-driven world that she
thrived on in back in her early 20s and 30s. A stay-at-home mom in
Weston, Mass., her life now revolves around her four children, who
range in age from six to 12. She has been home with her children for
nearly a decade and doesn't regret the decision, she said. "I was
having a really macho career, I was in the right place and now, I
sort of feel like I have other fish to fry," she said.
Not an Unusual Story Icke's career
trajectory is typical of many of her fellow female undergraduates at
Harvard who subsequently got their MBAs, according to a
new study from UC Berkeley's Haas School of Business. A
surprising number of these women have dropped out of the labor force
to become stay-at-home mothers, according to Berkeley professors
Catherine Wolfram and Jane Leber Herr. Their study, titled "Opt-Out
Patterns Across Careers: Labor Force Participation Rates Among
Educated Mothers," followed the career paths of nearly 1,000 women
who graduated from Harvard between 1988 and 1991, using a rich set
of biographical data culled from 10th and 15th anniversary reunion
surveys.
By the time they are 15 years out of
college, 28% of the Harvard women who went on to get their MBAs were
stay-at-home moms, compared to only 6% of women who got medical
degrees, the authors found. The study also looked at the career
paths of Harvard women who became lawyers and found 21% chose to
stay home with their children. Some of the women in the study
managed to to strike a balance between family life and work. For
example, the highest percentage of women in the study to work
part-time were doctors, while women in business, especially those in
finance and banking, were the least likely to have done so, the
study showed.
The study highlights the challenges
women with MBAs face as they try to balance family life and
fast-paced careers in the business world. Female enrollment at 25 of
the top U.S. full-time MBA programs hovers around 31%, according to
a 2007 study by the Forte Foundation, a consortium of schools
working to increase the number of women pursuing MBAs.
Long Hours and Mandatory Face Time
Keeping women with MBAs in the work force
remains yet another pressing problem, complicated by the fact that
many women graduate from business school right around the time they
want to start a family. This becomes an even trickier proposition
for women MBAs who work in fields like banking and consulting, which
require long hours and mandatory face time, said Elissa Sangster,
executive director of the Forte Foundation.
"There are plenty of women out there who
have made it work, but they all have their own individual stories,
whether it's a nanny, a stay-at-home dad, or working it out with an
individual manager who happens to have gone through the same thing,"
Sangster said. "It's all very one-off. The infrastructure is not
there in the business world, and that's what has yet to rise up in
these industries."
Continued in article
The UC Berkeley study is reported at
http://www.businessweek.com/bschools/rankings/full_time_mba_profiles/haas.html
Women With MBAs ---
http://www.businessweek.com/bschools/content/may2007/bs20070510_162993.htm
Jensen Comment
Unlike MBA graduation statistics, over half the graduates in accountancy
are women. This might complicate a similar drop out study for younger
women accountants on the job.
I don't know that a similar drop out study has been done with respect to
female accountants versus male accountants. I would expect total drop
out (not necessarily turnover) is a bit less of a problem with
accounting mothers and fathers who want to be at home more for their
children. The reason today is that many accounting jobs in recent years
can be heavily performed at home online with the terrific accounting
software and changing accounting employment opportunities available. CPA
firms have especially designed creative alternatives for working
mothers. Turnover is somewhat high with auditors after about five years
on the job, but this turnover is historic for men and women. It was, and
still is, very common for auditors to leave public accounting (where
hours are often long and travel can be tiresome). Many experienced
accountants opt out for 40-hour weekly jobs in the corporate and
government arena. Often young auditors accept offers from their former
auditing and tax clients.
Most students who enter accounting doctoral programs do so after 1-5
years on the job, but the numbers here are so small that these probably
would not impact on any survey of working accountants ---
http://faculty.trinity.edu/rjensen/theory01.htm#DoctoralPrograms
Three of the Big Four multinational accounting firms are
among the very top companies of the the world for working moms at Ranks 4/100,
5/100, 8/100
And all four are in the 15-year Hall of Fame for working moms
---
https://www.workingmother.com/working-mother-100-best-companies-winners-2019
The Big Four firms are among the very best companies to work for in
general at Ranks 26/100, 34/100, 36/100, and 44/100
---
https://fortune.com/best-companies/
Question
Will the business school faculty shortage be a thing of the past?
"Business PhD Applications on the Rise: A weak job market has
many contemplating PhDs and faculty jobs. Will the business school
faculty shortage be a thing of the past?" by Alison Damast, Business
Week, May 11, 2009 ---
http://www.businessweek.com/bschools/content/may2009/bs20090511_815452.htm?link_position=link1
With expenses such as business lunches
being curtailed and a dwindling list of new clients, Wayne Nelms
knew it was only a matter of time before he would be laid off by
accounting firm Grant Thornton.
"The writing was on the wall. I just didn't
know when," says Nelms, 36, who worked as senior internal auditor at
the company's Baltimore office for two-and-a-half-years. "Then I got
the e-mail."
By January he was out of a job and found
himself at a crossroads. Reluctant to jump back into the job market
immediately, he started exploring his options and stumbled upon the
PhD Project, a nonprofit that encourages minority business
professionals to earn PhDs and go on to become professors. He'd
heard of the program back when he was an MBA student at Howard
University but had put it on the back burner after graduation.
"When D-day happened, I decided, well I can
do one of two things with my future: Either get a doctorate or look
for a good old dependable job," said Nelms, who got in contact with
the PhD Project. A few weeks later he applied and was accepted to
the accounting PhD program at Morgan State University in Baltimore,
Md., where he'll be starting full-time this fall. Says Nelms: "With
a doctorate, I thought my destiny would be a little more in my
control."
Nelms is part of a growing wave of
professionals who are leaving the battered business world behind for
a career in the hallowed halls of academia. Applications are up
substantially this year at many top business PhD programs, with some
business schools reporting jumps in applications as high as 40%. PhD
program directors attribute the jump to professionals fleeing a weak
job market, coupled with a surge of interest from undergraduates
bypassing that job market entirely to head straight for school.
An Encouraging Sign Meanwhile,
organizations like the PhD Project say more people than ever before
are expressing interest in their programs and annual conference,
which attracted the largest number of participants in the
organization's 15-year history this fall. It's an encouraging sign
for the world of management education, where a looming faculty
shortage has had B-school deans worried for years.
The surge of interest in becoming a
business professor comes just as a backlash is being felt among
those in the business community who hold MBAs, says Yuval Bar-Or, an
adjunct at Johns Hopkins University's Carey Business School and
author of Is a PhD for Me? A Cautionary Guide for Aspiring Doctoral
Students, slated for release on May 19. Many fleeing the business
world for academia may view it as a more venerable profession, he
says.
"MBAs are now persona non grata in many
places, and there is a fair amount of animosity being directed at
them for living in the fast lane, spending everyone's money, and not
being responsible enough," Bar-Or says. "So business leaders, in
society's eyes, have been knocked off a pedestal, and that may be
causing a lot of people with an interest in business to want to go
down a path that is more respected in society."
Those who have been thinking about getting
a PhD are not wasting any time exploring their options. Potential
PhD students were out in full force this fall at the PhD Project's
annual conference in Chicago last November, where attendees mingled
with professors and deans from nearly 100 business schools around
the country. The conference usually attracts around 330 people, but
this year 832 people applied, about 534 of whom were invited to
attend.
"This was a substantial increase. It was so
big that we were starting to worry from a budgetary standpoint about
how we were going to pay for everything and if the room and hotel
was going to be big enough," said Bernie Milano, president of the
PhD Project. He expects that interest will continue to grow. He's
already received 65 applications for next year's conference, triple
the amount he usually receives by this time of year, he says.
Continued in article
Jensen Comment
There are a number of things working against an explosion of doctoral
students in accountancy.
Firstly, the traditionally large accounting doctoral programs
(Illinois, Texas, Michigan, Indiana, Florida, Wisconsin, Ohio State,
etc.) have greatly shrunk in size since their days of glory before the "accountics"
revolution commenced in the 1960s. Shrinking departmental budgets will
further dry up funding going into doctoral programs and accounting
research in general. Generosity of hard-pressed accounting firms and
alumni may also shrink private donations that are often used heavily to
fund endowed chair faculty and other needs of doctoral programs.
Secondly, many jobless accountants with high GMAT scores often
have children and financial responsibilities and will be turned off by
the five-year average time it takes to get an accounting PhD, especially
for jobless applicants who have weak and or maybe forgotten
accountics prerequisites (calculus, advanced calculus, linear algebra,
mathematical statistics, econometrics, data mining, etc.) for which few
have interest in studying for five more years of their lives. Accounting
doctoral programs now have little to do with accounting and everything
to do with making graduates scientists in econometrics, mathematics, and
psychometrics ---
http://faculty.trinity.edu/rjensen/theory01.htm#DoctoralPrograms
Thirdly, virtually all colleges and universities are now being
forced to downsize in some way due to shrinking budget allocations.
Recovery of these budgets will be slow long after the current recession
turns around because of the many demands placed upon states for other
priorities such as Medicare and expanded welfare that was only
temporarily shrunk by the Clinton Administration.. While expanding
entitlements for poor people, President Obama promises to eventually
reduce the Federal deficit which means more and more of the funding
burdens will fall upon state taxation. Californians are now showing the
world that taxpayers are not in the mood for higher state taxes. I do
not anticipate that the shrinking doctoral programs in accountancy will
get heavy revival funding for years to come.
Fourthly, due to shrinking budgets and explosive growth in
undergraduate accountancy programs, virtually all colleges and
universities, with blessings from the AACSB, are creating full-time
faculty positions for former practitioners who do not have accounting
doctoral degrees (although many have law degrees or doctorates in other
disciplines). These faculty reduce the demand for more expensive
graduates from accountancy doctoral programs. And this is an outlet for
early retirees who are great instructors with specialized skills (e.g.,
ERP, auditing, and tax) that are more in line with undergraduate
teaching curricula in accountancy undergraduate and masters programs.
The new AICPA-sponsored fellowship program for doctoral students who
elect auditing and tax will help but the number of students funded in
these professional specialties is too small to have much of an impact on
filling empty tenure track positions. The KMPG Foundation fellowships
for minority students has helped to get more African Americans into
accounting doctoral programs, but I do not anticipate great increases in
this funding source. The numerical impact of both these dedicated
programs will be very small among the thousands of accountancy education
programs in the United States.
There will be substantial increases in the doctoral programs in
management, marketing, MIS, and economics. Finance is a question mark
since the number of undergraduate students majoring in finance will
greatly decline due to black hole in job opportunities for graduates in
finance. With declines in undergraduate finance majors there will be
less demand for newly-minted professors of finance. Economics will
probably fare better because the fact that economics doctoral students
on average only take three years beyond a bachelors degree to complete
the doctoral program. Three-year doctorates are drawing cards to
many returning jobless graduate students who do not want to spend more
than three years earning a doctorate. And there will probably be
increased opportunities for economists in Obama's exploding Federal
government. Purportedly increasing numbers of doctoral students in
economics are looking forward to civil service careers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
You can read more about the accountics revolution that shrank the
accountancy doctoral programs at
http://faculty.trinity.edu/rjensen/395wpTAR/Web/TAR395wp.htm
You can read more about trends in accountancy doctoral programs at
http://faculty.trinity.edu/rjensen/theory01.htm#DoctoralPrograms
ILLINOIS CPA SOCIETY'S 2007 SURVEY ON ACCOUNTING WOMEN
Recently at its Women's Leadership Breakfast,
the Illinois CPA Society (ICPAS) released the results of its fifth
annual "Accounting Women: 2007 Survey on the Role of Women in CPA
Firms." The survey found only slight shifts in hiring and retention
patterns from the prior years' figures and that women are still
underrepresented in key leadership positions. The survey, conducted
through the Illinois CPA Society's Women's Executive Committee, tracks
the percentage of women in Illinois CPA firms at three levels:
senior/staff; senior manager/manager; and partner/principal. The 2007
survey document was sent to 78 Illinois firms with 15 or more
professionals. While the percentage of women entering public accounting
firms has decreased from 52 percent in 2004 to 49 percent in 2007, the
number of women being retained at the senior manager/manager and
partner/principal levels has slowly climbed from 39 percent to 42
percent and 16 percent to 18 percent, respectively, over this same
period. Also, although the number of women in the most senior positions
has moderately increased, the number of men continues to far outweigh
women in the partner/principal positions.
Andrew Priest,
AccountingEducation.com, June 2007 ---
http://accountingeducation.com/index.cfm?page=newsdetails&id=144980
Question
Why are there so few, if any left like Coach Gazowski?
"Accounting Degrees Up 19 Percent: AICPA Report," SmartPros,
May 6, 2008 ---
http://accounting.smartpros.com/x61772.xml
The American Institute of CPAs announced
that more than 64,000 students graduated with bachelor's and
master's degrees in accounting in the 2006-07 school year, a 19
percent increase since the 2003-04 school year, when the AICPA last
surveyed this data.
At
the same time, over 203,000 students enrolled in accounting programs
at both the undergraduate and graduate levels. This also represents
a 19 percent increase since 2004, according to the AICPA study,
2008 Trends in the Supply of Accounting Graduates and the Demand for
Public Accounting Recruits. The
gender ratio of graduates is fairly close at 52 percent female and
48 percent male.
"The
years in the aftermath of
Sarbanes-Oxley
have spotlighted the
critical role the accounting profession plays in our capital market
system," said Denny Reigle, AICPA director – academic and career
development. "One fortunate result of SOX was greater interest in
accounting on the part of students, as this report attests."
The demands
of Sarbanes-Oxley legislation likewise have led to substantial
hiring increases by public accounting firms, the primary employers
of new graduates. The AICPA report reveals that hiring by firms in
2006-07 shot up 83 percent over the previous three years.
Sixty-seven percent of the firms that responded to the survey
anticipate continued growth in hiring.
This is the
largest number of graduates in the 36 years the AICPA has been
tracking this data.
Jensen Comment
What I find most interesting is that, while celebrating the
post-SOX surge in the number of accounting graduates, we're reminded
that we still produced more accountants when the
Dow index was under $2,000, the AACSB was strict on standards, the
largest CPA firms were mostly national instead of international, and the
office space required for the largest CPA firms in any city was less
than 10% of what it is today. A much higher proportion of our graduates
in those days ended up working for smaller CPA firms or business firms.
Four decades ago client-firm executives were less inclined to seek out
creative accounting to pad their stock options since their pay was
reasonable and not so contractually tied to earnings numbers.
Historical cost ala Payton and Littleton ruled the accounting world
with underlying concepts such as the matching principle. Audit trails
did not disappear inside computers or the Cayman Islands.
Substantive tests reined supreme in auditing.
Judging from the adverse
PCAOB oversight reports of audits in the past couple years, I think
the auditing firms were more professional four decades ago and were less
inclined to cut corners due to budget overruns and staff shortages. This
is only my subjective opinion based upon my very limited career as a
real-world auditor with flying fingers on a 10-key adding machine. We
actually trudged down to Pueblo, Colorado to count pistons on Sundays
and waded through the muck in Montford's feed lots in Greeley in order
to estimate the amount of piled up manure inventory.
Students today have never seen one of those
typewriter-sized calculators with the moving bar that ratcheted back
and forth sort of on its own after being given a calculation to perform.
Four decades ago the CPA exam was narrow and deep compared with with
shallow and wide today when we have so many more complicated standards
that are barely touched on the CPA exam. I think the first-time passage
rate has remained pretty stable (15%-25%) over the years such that
somebody must be controlling the faucet.
We had one woman in the Denver office of Ernst & Ernst, who did tax
returns in the back office amidst a cloud of cigarette smoke. Emma was
rarely, if ever, allowed to see a client. Those were not the good old
days in many respects. Even though we produced more accounting graduates
in four decades ago, they were mostly white males. Women graduates were
supposed to be K-12 teachers and nurses rather than doctors, lawyers,
CEOs, CFOs, and accountants. Hispanics and blacks rarely had
opportunities to attend college. Many of our attitudes about fairness
and opportunity have changed for the good. But many of our attitudes
about compensation, life style, families, divorce, drugs,
plagiarism/cheating, and work have changed for the bad.
A C-grade was actually considered the median grade in college four
decades ago ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#GradeInflation
Accounting graduates did not have to have all A or B+ grades to be
interviewed for jobs.
Our teachers were not denied tenure because they were scholars rather
than researchers. Even if they were tough as nails and piled the work
over our heads in courses, they could still get tenure, respect, and pay
raises. Most of the professors I look back on with admiration, in
retrospect, would be un-tenurable today because they devoted too much
time to their craft and scared the bejeebers out of us. I can just
imagine the cursing words that would be written about them if we had
RATE-MY-PROFESSOR in those days ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#RateMyProfessor
But then again maybe the cursing words would not have flowed because I
think we had more respect for our teachers in those days.
Randy Pausch said it very well when he wrote about his tough old
football coach, Coach Graham, in Chapter Seven of The Last Lecture
(Hyperion Books, 2008, IABN 978-1-4013-2325-7).
. . . one of the
assistant coaches came over to reassure me. "Coach Graham rode you
pretty hard , didn't he?" he said.
I could barely muster a "yeah."
"That's a good thing," the assistant told
me. "When you're screwing up and nobody says anything to you
anymore, that means they've given up on you."
. . .
There's a lot of talk these days about
giving children self-esteem. It's not something you can give;
it's something they have to build. Coach Graham worked in a
no-coddling zone. Self-esteem? He knew there was really only one way
to teach kids how to develop it: You give them something they
can't do, they work hard until they find they can do it, and your
just keep repeating the process.
When Coach Graham first got hold of me, I
was this wimpy kid with no skills, no physical strength, and no
conditioning. But he made me realize that if I work hard enough,
there will be things I can do tomorrow that I can't do today. Even
now, having just turned forty-seven, I can give you a three point
stance that any NFL lineman would be proud of.
I realize that, these days, a guy like
Coach Graham might get thrown out of a youth sports league. He'd be
too tough. Parents would complain.
I remember one game when our team was
playing terribly. At halftime, in our rush for water, we almost
knocked over the water bucket. Coach Graham was livid: "Jeez!
That's the most I've seen you boys move since this game started!" We
were eleven years old, just standing there, afraid he'd pick us up
one by one and break us with his bare hands. "Water?" he barked.
"You boys want water?" He lifted the bucket and dumped all the water
on the ground.
. . .
It saddens me that many kids today are so
coddled. I think back to how I felt during that halftime rant. Yes,
I was thirsty. But more than that, I felt humiliated. We had all let
down Coach Graham, and he let us know it in a way we'd never forget.
He was right.
. . .
I haven't seen Coach Graham since I was a
teen, but he just keeps showing up in my head, forcing me to work
harder whenever I feel like quitting, forcing me to be better. He
gave me a feedback loop for life.
Bob Jensen's football coach would've viewed Coach Graham as a wimp.
My Algona High School coach's name was "The" Coach Tony Gazowski. Tony
grew up Polish and tough in the shadows of the steel mills in
Pittsburgh. He became an "All-Big-Ten" defensive end at the University
of Iowa and never did catch on that later in life he was a football
coach and not a Marine drill instructor (he was also a former Marine
sergeant). Coach Gazowski did for me what Coach Graham did for Randy,
but Coach Gazowski sometimes went a bit too far in urging us to play a
bit rougher than the rules allowed if we thought we could get away with
it. This might be a good thing to do on a wartime battlefield, but it's
not something I recommend in athletics and most other aspects of life.
You can read more about Randy and find the link to the video of
his "Last Lecture" and commentaries that followed at
http://faculty.trinity.edu/rjensen/tidbits/2008/tidbits080415.htm
"My Life in Crime:
Chronicles of a Forensic Accountant," by William C. Barrett III, SmartPros, January 2008 ---
http://accounting.smartpros.com/x59274.xml
The profession of forensic accounting is
like any other industry niche: You evolve to a plateau where track
record and honed skills permit you to "hold out" as a professional.
Then, like any other business, you starve a lot before you become an
overnight sensation -- in demand and truly at the top of your
practice in providing value -- both on scene and in the courtroom.
Here are a few of the cases I have directed
to give you an idea of how well-developed professional skepticism
prevails to reveal the fraudster -- usually a well-educated,
respected member of the community, quite adept at concealing and
perpetuating fraud by bending others to his or her will.
Continued in
article at
http://accounting.smartpros.com/x59274.xml
Bob Jensen's fraud
updates are at
http://faculty.trinity.edu/rjensen/FraudUpdates.htm
"Many of America’s Best CFOs Started in Accounting or Auditing,"
AccountingWeb, March 29, 2006 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=101935
Institutional Investor magazine has
completed their third annual “America’s best CFOs” ranking. They
asked brokerage firm research analysts and portfolio managers to
name the Best American CFOs across 62 industries. The voting
criteria started at keeping clean books and communicating
effectively with the market and ascended to going beyond traditional
number-crunching, cost-controlling roles, improving operations,
driving revenue growth, and executing big acquisitions.
Vinay Couto, a vice president at consulting
firm Booz Allen Hamilton, told Institutional Investor, “CFOs have
spent the past decade or so moving from being bookkeepers to being
business partners. In the past year or two, we’ve seen that trend
accelerate to the point where a growing number of CEOs are asking
CFOs to step even further outside the traditional bounds of their
positions and be responsible for pushing the business forward in an
active way.”
“There are a lot of CFOs out there that are
controllers with fancy titles. They know how to say no, and they’re
good at cost cutting. But what CEOs want now are people who can
think beyond cost controls and help grow the business. We’re
entering a phase of the business cycle where things are growing
again, and CFOs have to change their stripes,” Laurence Stybel,
co-founder and founder of Stybel Peabody Lincolnshire in Boston,
told Institutional Investor.
Several of the CFOS on this year’s list
started in the accounting or auditing world. Jeffrey M. Boromisa is
Senior Vice President and Corporate Controller of the Kellogg
Company. He joined Kellogg in 1981 as a senior auditor. Boromisa is
a Certified Public Accountant and a member of the American Institute
of Certified Public Accountants.
Mike Van Handel is the Executive Vice
President and CFO for Manpower. In 1989, he joined the company as
Director of Internal Audit and was named Vice President of
International Accounting in 1993, but his career track didn’t stop
there. He was named Chief Accounting Officer and Treasurer in 1995
and became Senior Vice President and CFO in 1998. Van Handel became
Executive Vice President in 2002. He came to Manpower after serving
as Audit Manager at Arthur Andersen & Company.
Christopher Kubasik is the Executive Vice
President and CFO of the Lockheed Martin Corporation. He is Chairman
of the Board of Directors of the Lockheed Martin Investment
Management Company that manages the company’s pension assets. He
handles all corporate aspects of financial strategies, processes,
and operations. Kubasik was at Ernst & Young before coming to
Lockheed Martin, becoming a partner in 1996, specializing in
government contracting and high technology companies.
"New Grads Are Impatient for Promotions," by Emily Meehan,
The Wall Street Journal, June 20, 2007 ---
Click Here
Twentysomethings are accustomed to meeting
short-term goals in schools with quarter and semester systems. They
expect to see results on the job just as quickly and when they
don't, impatience sets in. The disgruntled say that they don't
necessarily want more money, they want stimulating assignments that
give meaning to their lives.
. . .
Matt Miades, a 39-year-old recruiter at
PricewaterhouseCoopers in Philadelphia, counsels twentysomething
associates at the firm to be less impetuous. Pricewaterhouse hires
entry-level associates to do auditing, but they're not promoted only
on the basis of their auditing skills. The firm promotes people with
managerial chops who demonstrate their communication skills
(important for dealing with clients), says Mr. Miades. And
successfully executing an advanced task just once or twice is not
enough.
That means it can be years before a
promotion happens. "We have a very keen sense of when the cake needs
to bake a little longer," he says. But Mr. Miades says it's worth it
for associate X to keep his or her wagon hitched to the Big Four
accounting firm "surrounded by high-performing people … [and] all
sorts of opportunities." Being patient and staying at one firm also
allows entry-level workers to develop relationships, he says, which
is key in advancing their skills and careers.
Mr. Miades and other partners aren't going
to hassle a 22-year-old about his management skills. They'll give
The Freshman some time to adjust to auditing. Mr. Miades says he
encourages new hires to adapt their timelines from a semester scale
to a corporate one, which isn't as clearly delineated. He makes a
point of reaching out to them in meetings, at monthly happy hours or
the impromptu game of pool after work.
Continued in article
Accountants' SOX are attention grabbers
However, regulatory changes such as
Sarbanes-Oxley Section 404 have increased tax departments' visibility in
front of key audiences. Almost half (46 percent) of respondents reported
that Section 404 has increased the department's visibility to the
company's board of directors, and 58 percent say that it has increased
visibility to the audit committee. The KPMG survey results also point to
a gap between tax directors' increasing concern about tax risk and the
amount of time they have to identify and minimize it. Definitions of
"tax risk" vary among respondents from "risk of tax audit" or "financial
reporting risk" to "risk of effective tax rate surprises" and
"management of tax return filing issues."
"KPMG Study Reveals State of Corporate Tax,"
SmartPros, November
3, 2006 ---
Question
In the public accounting profession, what's a PFS?
Hint
PFS is a new credential to put after one's name --- it looks better than
Pfffssssttt
The American
Institute of Certified Public Accountants (AICPA) and Texas Tech
University's Division of Personal Financial Planning have announced a
joint agreement to develop a new educational program that will lead to
the AICPA's Personal Financial Specialist (PFS) credential. The program
will officially begin in June 2009, but the AICPA and Texas Tech have
announced that they will conduct a PFS Pathway beta program or test
program at AICPA offices in Dallas November 10 through 14th. The PFS
beta program consists of four days of intense comprehensive personal
financial planning case study in 12 technical areas, including estate
planning, employee benefits, investment planning, financial
independence, and income tax planning. Participants take an eight-hour
multiple choice exam of approximately 200 questions on the fifth day.
"AICPA and Texas Tech announce new pathway to PFS credential,"
AccountingWeb, August 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=105793
Personal Finance
Helpers
From Smart Stops on the Web,
Journal
of Accountancy, July 2008
KEEPING IT
SIMPLE
This Smart Stop’s author
puts together a “Blueprint
for Financial Prosperity,”
working and blogging through
the complexities of personal
finance. Articles include
“Speed Up or Shift Up:
Thinking About Your Income
Path” and “Do You Have an
Opportunity Fund?” Also find
tax and investing coverage,
plus reviews of financial
planning and wealth
management books. Every
month, the author plays
“Devil’s Advocate,” where he
examines the other side of
“mainstream” or “common
sense” personal finance
ideas. Recent “Advocate”
posts include “Don’t Budget
to the Penny” and “Don’t
Just Buy Index Funds.”
THIS WEEK
IN PERSONAL FINANCE
The Carnival of Personal
Finance touts itself as “a
traveling weekly showcase of
the best blog articles on
the topic.” The carnival is
hosted by a different guest
blogger each week. In every
edition, you’ll find links
to the guest editor’s picks
of the week, typically
highlighting five to 10
posts from various sources,
which feature expert advice
on professional sites or
regular-Joe experiences on
personal sites. You can
submit your own post for
consideration, view the
schedule of upcoming hosts
or just browse the wealth of
archived articles. |
"Feed the Pig" is the AICPA's terrible name for its free site for helping
people with personal finances
http://www.aicpa.org/financialliteracy/FeedThePig/
"New Feed the Pig Curriculum Targets Younger Audience,
Journal of Accountancy,
December 2008 ---
http://www.journalofaccountancy.com/Issues/2008/Dec/NewFTPTargetsYoungerAudience.htm
Financial Literacy Tools 2013
The AICPA's financial literacy campaign has reached many individuals in
creative ways, writes Melora C. Heavey, senior manager of communications at
AICPA. A community college teacher uses the interactive
Me Save feature on the Feed the Pig website to help her students
identify what type of spenders they are. A friend uses the
360 Retirement Planner to make sure he is on track with his savings.
Other popular tools include the
Weekly Savings Tip and
Tweens Curriculum.
AICPA Insights
Spreading Financial Well Being
---
http://blog.aicpa.org/2013/01/spreading-financial-well-being.html#sthash.cJDIaL8x.azMXjhsc.dpbs
Bob Jensen's threads on
personal finance are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Bob Jensen's threads on
credit reporting are at
http://faculty.trinity.edu/rjensen/FraudReporting.htm#FICO
Bob Jensen's helpers for
finding a financial advisor are at
http://faculty.trinity.edu/rjensen/fees.htm
Bob Jensen's career
helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Watch for Fraud When Trying to Repair Your Credit ( FICO ) Score
---
http://www.creditscore.net/
"Accounting Firms Among BusinessWeek’s 'Best Places to
Launch a Career'," AccountingWeb, September 22, 2006 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=102606
When it comes to launching a career, four
accounting firms have made BusinessWeek’s list of best places to
start. Only three of the “Big Four” firms, Deloitte & Touche USA LLP,
Ernst & Young and KPMG LLP, are among the top 55 places to launch a
career. Grant Thornton LLP is the only non-Big Four firm appearing
on the list.
BusinessWeek’s analysis of top employers
for recent college graduates is the most comprehensive of its kind,
examining feedback from students, college career counselors, and
employers themselves, to reveal which companies offer the biggest
advantages for entry-level employees, such as the highest pay, the
quickest advancement and the best training programs.
Deloitte & Touche, where one-quarter of all
partners have been with the firm for more than 20 years, held the
highest ranking among accounting firms at number 3. In addition,
one-third of experienced hires are “boomerangs” who have left and
returned.
The permanent four-day weekends for Labor
Day, July 4th and Memorial Day, instituted in 2005, helped Ernst &
Young land in the number 12 spot on the BusinessWeek list. The firm
is the only one of the ranked accounting firms not offering a
management training program.
KPMG’s allotment of 25 paid days off for
entry level professionals is among the most generous offerings on
the list and good enough to earn the firm a number 15 ranking.
“I am very proud of the fact that so many
students, counselors and employees see our firm as one where they
can make a professional home – and make a difference,” Ed Nusbaum,
Grant Thornton’s chief executive officer (CEO), said in a prepared
statement. “Great people are our brand, so I am pleased that we are
a coveted place to work.”
In ranking Grant Thornton as number 34,
BusinessWeek highlighted the fact that more than four out of five
interns become full-time associates. The firm’s most valuable trait
is identified as its leadership skills, and LEADS, the leadership
development program, was specifically noted.
With four ranked firms, the accounting
industry makes a very respectable showing on this year's list. The
industry with the most ranked firms was the financial services
industry, having nine ranked firms. In second place, with seven
ranked firms, is the consulting industry, followed closely by the
the consumer goods and government industries, which both had six
ranked firms.
Career helpers for cubicle workers ---
http://cuberules.com/
Career Opportunities Explode in Internal Auditing
"Internal Auditing Gaining in Popularity," AccountingWeb,
April 17, 2006 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=102032
With internal auditors taking a more
prominent role in U.S. companies, the popularity of the field is
surging. "Our membership has more than doubled in the last 10
years," said Trish Harris, director of communications for The
Institute of Internal Auditors (IIA). "There's been huge growth."
The IIA's membership has grown 38 percent
since 2000, and the number of people taking the certified internal
auditor exam rose from 30,634 to 38,000 in 2005, the Pittsburgh
Business Times reported.
The Sarbanes-Oxley corporate reform
legislation brought internal auditing out of the back rooms of
corporate headquarters. Now, internal auditors are reporting
directly to the CEO or board of directors, and their visibility
makes it easier for them to get promoted.
"People who work in internal auditing have
the opportunity to see every corner of the enterprise and interact
with executives throughout the company," said Bill Strait, director
of internal audit for Respironics Inc., which makes sleep apnea
devices. "Because of (Sarbanes-Oxley), because of business failures,
it's become even more of a launching pad for people moving into
important areas of the company."
Continued in article
CareerJournal.com (all disciplines) ---
http://www.careerjournal.com/
Question
What do CFOs think accounting undergraduate and masters programs are doing
better than ever before?
Answer
"Colleges and universities are responding
to a changing accounting landscape," said Max Messmer, chairman of
Accountemps. "More courses are being offered in areas such as internal
audit, enterprise risk management, forensic accounting, information
technology and business ethics." The appeal of an accounting career is
growing, perhaps as a result of increased emphasis on the profession.
According to the American Institute of Certified Public Accountants,
enrollment in accounting programs climbed 19 percent from 2000 to 2004,
following declines during the late 1990s. There also was a 17 percent
increase in the number of new accounting graduates hired by
organizations between 2003 and 2004.
"Accounting Grads Better Prepared, Survey Says,"
AccountingWeb,
January 31, 2006 ---
http://accounting.smartpros.com/x51625.xml
Nearly 1,500 accounting and finance professionals with a wide variety of
experience reported an average annual salary of
$70,497 in the just-released
SmartPros Salary Survey. Among the findings, certifications such as the
CMA or CPA continue to significantly boost salaries. The
full report
contains survey data
by area of practice, professional title, certification and years of
experience, and results from the "most valued benefit" poll.
"SmartPros Salary Survey Results: CPAs, CFOs,"
SmartPros,
February 2006 ---
http://accounting.smartpros.com/x51651.xml
Sort of Knocks Your SOX Off: Accounting Firms
Post Double-Digit Growth Rates
The past year has been profitable
for the majority of accounting firms, with an average growth
rate of 16.5 percent, the highest reported growth since
2000, according to the CCH Public Accounting Report Top 100
list released Friday. Firms outside the Big Four posted
stronger overall results than their larger counterparts,
with non-Big Four firms growing their revenue at an average
rate of 21.9 percent compared to 14.7 percent for the Big
Four.
"Accounting Firms Post Double-Digit Growth Rates,"
SmartPros, September 5, 2006 ---
http://accounting.smartpros.com/x54636.xml
Question
Who are the highest paid undergraduates in their starting
jobs?
|
Source:
|
National Association of
Colleges and Employers |
Country:
|
United
States |
Date:
|
27/02/2006 |
Contributor:
|
Andrew
Priest |
Web:
|
http://www.naceweb.org |
The following majors have the highest salaries paid to 2005-06
graduates (average salary offers are in parentheses): Chemical
engineering ($55,900)
- Computer engineering ($54,877)
- Electrical/electronics and communications engineering,
($52,899)
- Mechanical engineering ($50,672)
- Computer science ($50,046)
- Accounting ($45,723)
- Economics/finance, including banking ($45,191)
- Civil engineering ($44,999)
- Business administration/management ($39,850)
- Marketing/marketing management, including marketing research
($36,260)
Extreme Accounting (they're not as dull as you may
think)
November 21, 2005 message from Donald Ramsey
[dramsey@UDC.EDU]
For an awesome list of 43 professional
certifications in accounting and finance, compiled by Prof. Greg
Burbage of Sacramento City College, check
http://www.scc.losrios.edu/~burbagg/CPALinks.html
The Lure
of an Executive MBA Program in China
From The Wall Street Journal Accounting Weekly Review on June 20, 2008
China Beckons for M.B.A. Trips
by
Samar Srivastava The Wall Street Journal Jun 17, 2008 Page: D7
Click here to view the full article on WSJ.com
---
http://online.wsj.com/article/SB121364686908778517.html?mod=djem_jiewr_AC
TOPICS: Accounting
SUMMARY: David Gannaway is a "44-year-old
director of forensic accounting at KPMG LLP" who
holds an MBA from Fordham University. He says that
"the school's offering of a capstone trip to China
helped seal his decision" to enter the Executive
M.B.A. program there.
CLASSROOM APPLICATION: Career options for
accountants beyond the CPA and domestic borders can
be discussed with this article
QUESTIONS: 1. (Introductory) In general, what career
options are available to accountants beyond the CPA
and beyond domestic borders? List all that you can.
2. (Advanced) What is a forensic
accountant? Why do you think the KPMG LLP director
of forensic accounting entered an MBA program?
3. (Introductory) What is the importance
today of international experience? Is it limited
only to accountants practicing in large firms?
4. (Advanced) Summarize, citing one or two
themes, students' reasoning for entering into
programs with international study available. Are
those reasons necessarily the same as the benefits
students identify after completing the programs?
Reviewed By: Judy Beckman, University of Rhode
Island |
"China Beckons for M.B.A. Trips Tours
Offer Chance To Make Contacts, Learn Lay of Land," by Samar Srivastava,
The Wall Street Journal, June 17, 2008 ---
http://online.wsj.com/article/SB121364686908778517.html?mod=djem_jiewr_AC
When David Gannaway was looking for an
executive M.B.A. program, he wasn't interested only in a school's
reputation. The 44-year-old director of forensic accounting at KPMG
LLP wanted details on the schools' destination for E.M.B.A.
international-study trips.
International trips have been a staple
feature of E.M.B.A. programs -- fast-track M.B.A. programs typically
held every other weekend and geared toward managers with several
years of experience -- for the past two decades. These trips, which
typically span two weeks, are designed to give students a broader
understanding of global business.
Over the years, Argentina, Hungary, Russia
and Singapore had dotted the trip lists. Now, E.M.B.A. candidates
are increasingly demanding to go to China, as more managers -- and
prospective E.M.B.A. students -- say they see themselves doing
business there. Some say they are able to use the trips to suggest
changes in the ways their companies do business in China.
Ahead of India
In 2007, 49% of such trips were to China,
according to the Executive MBA Council, an industry association. In
distant second place: India, with 11% of study trips outside the
U.S.
The impetus for growth goes to the heart of
the challenges of a global economy. Managers and executives
regularly complain about the difficulty they have in understanding
China. They cite a vastly different culture, a language that doesn't
use the Roman alphabet and a different socioeconomic structure from
the West's. And, executives say, getting to know China and its
business climate is now critical to a career.
Mr. Gannaway, who graduated last month from
Fordham University, says the school's offering of a capstone trip to
China helped seal his decision.
School administrators say they hear that a
lot. It "is one of the first questions the students ask," says Jaki
Sitterle, managing director of executive programs at New York
University's Stern School of Business. Two years ago, when the
University of Arizona's Eller College of Management proposed an
international trip to South Africa, its administrators were
compelled to go to China after students complained.
Continued in article
Bob Jensen's threads on careers are
at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Occupational Outlook Handbook, 2006-2007 Edition ---
http://www.bls.gov/oco/home.htm
For hundreds of different types of jobs—such as
teacher,
lawyer,
and nurse—the
Occupational Outlook Handbook tells you:
- the training and education needed
- earnings
- expected job prospects
- what workers do on the job
- working conditions
In addition, the Handbook gives you
job
search tips, links to
information about the job market in each State, and
more.
Accountants and Auditors ---
http://www.bls.gov/oco/ocos001.htm
Employment of accountants and auditors is
expected to grow faster than average for all occupations through the
year 2014. An increase in the number of businesses, changing
financial laws and regulations, and increased scrutiny of company
finances will drive growth. In addition to openings resulting from
growth, the need to replace accountants and auditors who retire or
transfer to other occupations will produce numerous job openings in
this large occupation.
As the economy grows, the number of
business establishments will increase, requiring more accountants
and auditors to set up books, prepare taxes, and provide management
advice. As these businesses grow, the volume and complexity of
information developed by accountants and auditors regarding costs,
expenditures, and taxes will increase as well. An increased need for
accountants and auditors will arise from changes in legislation
related to taxes, financial reporting standards, business
investments, mergers, and other financial events. The growth of
international business also has led to more demand for accounting
expertise and services related to international trade and accounting
rules, as well as to international mergers and acquisitions. These
trends should create more jobs for accountants and auditors.
As a result of accounting scandals at
several large corporate companies, Congress passed legislation in an
effort to curb corporate accounting fraud. This legislation requires
public companies to maintain well-functioning internal controls to
ensure the accuracy and reliability of their financial reporting. It
also holds the company’s chief executive personally responsible for
falsely reporting financial information.
These changes should lead to increased
scrutiny of company finances and accounting procedures and should
create opportunities for accountants and auditors, particularly
CPAs, to audit financial records more thoroughly. In order to ensure
that finances comply with the law before public accountants conduct
audits, management accountants and internal auditors increasingly
will be needed to discover and eliminate fraud. Also, in an effort
to make government agencies more efficient and accountable, demand
for government accountants should increase.
Increased awareness of financial crimes
such as embezzlement, bribery, and securities fraud will increase
the demand for forensic accountants, to detect illegal financial
activity by individuals, companies, and organized crime rings.
Computer technology has made these crimes easier to commit, and they
are on the rise. At the same time, the development of new computer
software and electronic surveillance technology has made tracking
down financial criminals easier, thus increasing the ease with
which, and likelihood that, forensic accountants will discover their
crimes. As success rates of investigations grow, demand also will
grow for forensic accountants.
The changing role of accountants and
auditors also will spur job growth, although this growth will be
limited as a result of financial scandals. In response to demand,
some accountants were offering more financial management and
consulting services as they assumed a greater advisory role and
developed more sophisticated accounting systems. Because Federal
legislation now prohibits accountants from providing nontraditional
services to clients whose books they audit, opportunities for
accountants to offer such services could be limited. However,
accountants will still be able to advise on other financial matters
for clients that are not publicly traded companies and for nonaudit
clients, but growth in these areas will be slower than in the past.
Also, due to the increasing popularity of tax preparation firms and
computer software, accountants will shift away from tax preparation.
As computer programs continue to simplify some accounting-related
tasks, clerical staff will increasingly handle many routine
calculations.
Overall, job opportunities for accountants
and auditors should be favorable. After most States instituted the
150-hour rule for CPAs, enrollment in accounting programs declined;
however, enrollment is slowly beginning to grow again as more
students become attracted to the profession because of the attention
from the accounting scandals. Those who earn a CPA should have
excellent job prospects. However, many accounting graduates are
instead pursuing other certifications, such as the CMA and CIA, so
job prospects may not be as favorable in management accounting and
internal auditing as in public accounting. Regardless of specialty,
accountants and auditors who have earned professional recognition
through certification or licensure should have the best job
prospects. Applicants with a master’s degree in accounting, or a
master’s degree in business administration with a concentration in
accounting, also will have an advantage. In the aftermath of the
accounting scandals, professional certification is even more
important in order to ensure that accountants’ credentials and
ethics are sound.
Proficiency in accounting and auditing
computer software, or expertise in specialized areas such as
international business, specific industries, or current legislation,
may be helpful in landing certain accounting and auditing jobs. In
addition, employers increasingly are seeking applicants with strong
interpersonal and communication skills. Because many accountants
work on teams with others from different backgrounds, they must be
able to communicate accounting and financial information clearly and
concisely. Regardless of one’s qualifications, however, competition
will remain keen for the most prestigious jobs in major accounting
and business firms.
Over 45,000 lawyer jobs in the United States were lost since the 2008
economic meltdown
Should we break out the Champagne? (just kidding)
"Law Firm Recruiting Volumes Inch Up, Making Modest Gains After
Recession-Era Declines," NALP, 2012 ---
http://www.nalp.org/uploads/PerspectivesonFall2011.p
Forensic Accounting
There’s a rather nice module on Forensic Accounting at
http://en.wikipedia.org/wiki/Forensic_Accounting
This includes links to a journal and career opportunities.
The link to the following article was forwarded by Charles Wankel
[wankelc@VERIZON.NET]
"Account for more than hill of beans,"
The Bay City Times Via The Saginaw News, December 16, 2007 ---
Click Here
When Kojo Quartey went to college to learn
accounting 25 years ago, many considered the job a steady,
unexciting career.
But financial scandals in recent years at
Enron, WorldCom and other companies have transformed the field, says
Quartey, dean of Davenport University's Donald W. Maine School of
Business.
''When I was an accounting student, we were
all number crunchers. In this day and age, it's a much more exciting
field,'' he said.
Many accountants today are seeking
specialized training to work as detectives who can sniff out
financial fraud. They call themselves forensic accountants.
Davenport, a Grand Rapids-based university
with branches at 5300 Bay in Kochville Township and at 3930 Traxler
Court in Bay County's Monitor Township, has two online offerings in
the growing field. One is a new bachelor's degree in business
administration in accounting fraud investigation and the other is a
forensic accounting examiner certificate available to postgraduates.
Forensic accountants undergo training to
mind the books while keeping an eye out for crime.
Demand for accountants who have such
training is skyrocketing, Quartey told a group of Bay and Arenac
county high school counselors.
In addition to traditional accounting,
forensic accountants may learn from law enforcement experts about
how to detect fraud, and from psychologists about how to interview
people to detect lying, Quartey said.
Irene Bembenista teaches classes at
Davenport required for the forensic examiner certificate.
''It's not just how to do an audit, but
what are some of the clues that would indicate something more is
going on? And ideas about where to further investigate,'' said
Bembenista, Davenport's associate business school dean.
Bembenista said 10 years ago, people did
not generally recognize forensic accounting as a college career
path.
A federal law enacted in 2002 to reform
accounting has brought the investigation field into its own. It's
also created job opportunities because it requires accountants at
public entities to maintain a separation of duties, Bembenista said.
''Accountants aren't allowed to do double
duties, like taxes and audit the company at the same time,'' she
said.
''And businesses are very interested in
accountants with a fraud (detection) background, because they are
looking out for the well-being of the organization.''
The starting salary for an accounting fraud
investigator is $48,000 to $60,000 a year, and certified forensic
examiners can earn more than $100,000 a year, Davenport says
compensation studies indicate.
Davenport has about two dozen students
enrolled in the forensic accounting certificate curriculum, Quartey
said. The next term begins in January, and more information is
available on the Internet at
www.davenport.edu
Bob Jensen's threads on forensic accounting are at
http://faculty.trinity.edu/rjensen/fraud.htm
Redesigning an MBA Curriculum Toward the Action
"Wall Street Warms To Finance Degree With Focus on Math," by Ronald
Alsop, The Wall Street Journal, November 14, 2006; Page B7
---
Click Here
Just a few years ago, the University of
California, Berkeley, found its master's degree in financial
engineering a hard sell. Wall Street had cut back sharply on hiring,
and many recruiters were still fixated on M.B.A. graduates.
"The doors were shut on us at the
human-resource level on Wall Street," recalls Linda Kreitzman,
executive director of the financial engineering program at
Berkeley's Haas School of Business. "I had to go directly to
managing directors to get our students placed after we started the
program in 2001."
Now, in a turnabout, it's often the banks
and hedge funds that are calling on Dr. Kreitzman and offering her
graduates six-figure compensation packages. "They have come to
realize they really need students with strong skills in financial
economics, math and computer modeling for more complex products like
mortgage- and asset-backed securities and credit and equity
derivatives," she says. This fall, all 58 financial engineering
students seeking internships found spots at such companies as
Citigroup, Lehman Brothers and Merrill Lynch. Their projects will
include credit portfolio valuation, artificial-intelligence trading
models and structured fixed-income products.
While the master's in business
administration certainly remains in high demand, companies are
increasingly interested in other graduate-level credentials,
including Ph.D.s and master's degrees in specific business fields.
Deutsche Bank, for example, has hired Ph.D. and master-of-finance
graduates in Europe for some time and is now recruiting more in the
U.S. as well.
"We are continually looking for strong
quantitative skills," says Kristina Peters, global head of graduate
recruiting. With a master's degree in finance, "there tends to be
more applied finance knowledge such as derivatives pricing."
Continued in article
Jensen Comment
The big question is where will auditing firms find accountants that can
handle the exotic contracts written by the financial engineers?
Survey reveals salaries for Management Accountants Rising
Top management accountants and finance
professionals pulled ahead of public accountants in both average salary
and total compensation in 2004 as the new auditing requirements of the
Sarbanes-Oxley Act took effect. Public accounting, which held the top
spot in 2003, fell to 6th place last year with management accountants
and finance professionals rising to first and second place, according to
the findings of the 16th annual salary survey conducted by the Institute
of Management Accountants (IMA). Salaries and compensation were found to
be higher for professionals holding a Certified Management Accountant
(CMA) credential only ($97,908), than for those with a Certified Public
Accountant credential ($93,104) alone. Professionals holding both
certifications had the highest earnings of all ($105,155), and those
with neither certification had the lowest ($79,763).
Andrew Priest, "New Survey reveals salaries for Management Accountants
Rising," AccountingEducation.com, June 18, 2005 ---
http://accountingeducation.com/news/news6298.html
Note the the link to the IMA site is incorrect in the above article.
The correct link is
http://www.imanet.org/ima/index.asp
"Rules spur demand for accountants: Universities can't turn
them out fast enough," by Barbara Hagenbaugh, USA TODAY, January 18,
2005 ---
http://www.usatoday.com/printedition/news/20050118/1a_bottomstrip18.art.htm
Call it the revenge of the nerds.
While many professions have been slow to
hire, accounting firms have been adding to their payrolls, leading to
greater pay and perks for the nation's bean counters. In the last
three months of 2004, the number of people working as accountants or
bookkeepers rose 2.4%, nearly five times the rate of increase in jobs
economywide, according to the government.
“It's clearly one of the hottest markets
(for accountants) that I've seen,” says Brent Inman of
PricewaterhouseCoopers. On-campus hiring by his firm in 2004 was up
45% from two years earlier and is expected to grow 20% this year.
Hiring of experienced accountants has been growing at a similar rate.
The increases are mostly attributed to the
federal Sarbanes-Oxley law, which created new government standards in
the wake of accounting scandals, most notably at energy giant Enron,
and led to a greater need for accountants.
The job growth has sparked greater interest
in accounting on college campuses. In the 2002-03 academic year, the
most recent data, nearly 50,000 students received either bachelor's or
master's degrees in accounting, up 11% from the prior year and the
largest number in seven years, according to the American Institute of
Certified Public Accountants.
But the increase in students still can't keep
up with demand.
“There's still a lot of seats that need to
be filled,” says William Hogan, a partner at accounting firm John R.
Waters in Chicago.
Accountants are increasingly able to call the
shots when looking for jobs. They're demanding higher pay, flexible
work arrangements and even signing bonuses. Hogan says annual pay for
entry-level accountants at his firm rose approximately $10,000 to
between $50,000 and $55,000 in two years.
Accounting
Grads Face Best Job Prospects in Years (increasing demand for an already
short supply of accounting educators) College graduates with accounting
degrees are entering the working world at a good time - recruiters are
eager, jobs are plentiful and offers are attractive.
AccountingWEB, November 22, 2004 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=100115
LocalAccountingJobs.com
has over 80,000 Active Accounting & Finance Job Applicants in our
database on January 18, 2005!
Job market site from the AACSB (It includes the higher education
job market) --- http://www.aacsb.edu/jobs2/
Accounting
Professional Site Links
The CPA Team
http://www.cpateam.com/
Bob Jensen's Threads on
Professional Practice, Fees, Choosing Accountants, Financial Advisors,
and Consultants
http://faculty.trinity.edu/rjensen/fees.htm
December 8, 2004 message from the AACSB
AACSB
International's popular online
career marketplace targets
business education careers in all
business disciplines and from all around the world. Browse
this job market site:
- By
discipline/field
- By
country, state/province within each discipline
- By
administrative or faculty positions
Plus, you can sign
up for automatic email notification of new postings - no
need to browse the site on a daily basis!
And M.E.Jobs has links to other resources of interest to
business school educators, such as school profiles, salary survey
results, and seminars.
"How accountancy can save lives: Olivia McGill of Goal UK
wants to hear from accountants and engineers who would like to make a
difference," The Guardian, October 4, 2006 ---
http://society.guardian.co.uk/aid/story/0,,1887362,00.html
Our accountants are helping to rebuild
lives torn apart by war in Sudan. Our engineers saved lives after
the earthquake in Pakistan. We are
Goal UK, and we are looking for more people like you.
People like David Cassidy, who spent three
years as a management accountant with Rolls Royce, traveling widely
in Britain and Germany, but who has just finished his first month as
roving accountant with Goal - in Sudan. David says his life will
never be the same again.
"This is my first job in the humanitarian sector and unlikely to be
my last," he said. "It's very different to life in the UK, the
weather, the attitude, the people.
"Most of the foreign nationals haven't had
a formal education, which makes improving their ability in the
profession difficult. What I enjoy most about my job is visiting
Goal projects. Accounting is accounting, for me it's this
environment that's exciting".
Unlike many of the bigger international
development aid agencies, Goal recruits professionals who have no
volunteering experience. It's a policy that helped David to find his
niche in the third sector.
Founded in Ireland almost 30 years ago by
John O'Shea, a former sports journalist, Goal is expanding in the
UK, and is looking for more Goalies, as we call our volunteers. Goal
UK is urgently looking for accountants and engineers, and two
information evenings for recruits are coming up in London - the
first is tomorrow.
The aid agency has received praise from the
likes of Mary Robinson, the former UN High Commissioner for Human
Rights, Kofi Annan, the secretary general of the UN, and the Foreign
Office.
"For Goalies, Goal represents a
non-bureaucratic approach to work, a can-do attitude, and with a low
administration cost - under 5% - you're confident that the money is
going straight to projects we're working on," David said.
Martin Otley, an associated chartered
accountant, is just back from a year with Goal as a financial
controller in Honduras.
Sitting at his old desk in Deloitte Touche
in London, he is patiently waiting for the dust to settle.
"I felt like I was in a factory, I couldn't
sit another day here. I wanted to see another part of the world -
and I had an interest in development work so it wasn't purely
altruistic," he said. "My biggest challenge was being part of the
emergency response after a hurricane in neighbouring El Salvador.
Because Goal is one of the smaller organisations there are more
decision making powers at my level.
"As an NGO we worked closely with
government agencies. It depends on what gives you a buzz, but for me
that's very exciting."
Goal was one of the first agencies to
arrive in the Bagh region of Pakistan after the earthquake last
October. Andy Cox, an engineer, was among those at the forefront of
relief operations.
"We saved lives by creating one warm room
for the vulnerable," he said. "The people wanted to remain on or
near their homesteads for winter, and we facilitated this.
"Otherwise families would have streamed
downhill when the cold set in. They would have crammed into camps
where the potential for disease and protection issues would be
extremely difficult to counteract."
With a need for earthquake-resistant
building practices, Goal funded workshops training masons and
carpenters in safe building practices.
Kubilay Hicyilmaz, a British earthquake
engineer, said: "Few of the agencies, except for Goal and one other,
had an engineer in Pakistan working to address the cause of the
problem rather than just dealing with the fallout.
"Through the workshops Goal identified
individuals with the right skills, to ensure that the programme can
continue even after we leave."
Goal urgently needs accountants and
engineers to volunteer to help run its programmes in 13 developing
countries. There's plenty of scope for movement into management
positions, and initiative is rewarded and emphasis placed on a
proven ability to get things done.
So why not transfer your skills to where
they could make the difference between life and death?
· Goal UK is holding an information
evening for finance professionals on October 5 and for engineering
professionals on October 19, both at 6.30pm at Jurys Kensington
Hotel, Queens Gate, London. Registration is required: contact Laura
Byrne on lbyrne@goal-uk.org
or 020 7631 3196
"Smart Stops on the Web," by Vince Nolan, Journal of
Accountancy, August 2006 ---
http://www.aicpa.org/pubs/jofa/aug2006/news_web.htm
CAREER BUILDING
SITES
The Job Hunt
www.quintcareers.com
The Quintessential Careers Web portal offers links to job databases
and search engines for more than 1,400 employment and resume-writing
e-stops. Accounting and finance professionals also can research the
latest starting salaries by geographic location and find schools
offering continuing education programs. Once you’ve landed the
interview, revisit the portal for behavioral interview strategies,
interview dos and don’ts and tips for avoiding interview bloopers.
The Selection Process
http://jobstar.org
You’ve done the resume-writing, posting and job-search thing and you
have a few interviews lined up. Now come to this site to check out
more than 300 free salary surveys, some specifically for accounting
and finance, take a salary I.Q. test and learn strategies for
negotiating a higher starting salary. Already employed and looking
to make a change? Career Guides has resources and links to the
fastest growing job opportunities and aptitude tests for new
occupations.
The Juggling Act
http://wlb.monster.com
You’ve got a new job and you’re busier than ever. Maybe too busy? Go
to Monster’s Work/Life Balance Web stop for tips on how to simplify
your work life in sections on office culture and politics, career
development and managing time and stress levels. Also get advice on
negotiating a flex schedule, building workplace friendships or
renegotiating your salary at review time. Take quizzes to find out
whether you’re a team player or a workaholic, and whether you’re
getting the most out of your downtime.
Strike a Balance
www.workforceonline.com
Looking for advice on managing your work and home lives? The
Benefits section at this Smart Stop links to articles on caregivers,
the cost of absenteeism and flex practices. Free registration also
gets you access to newsletters on human resources and recruiting
topics. Community Center discussion threads let registrants voice
their opinions and share information on topics from age bias and
workplace dress codes to staffing and telecommuting. Check out the
business cartoons in The Buzz for a quick chuckle.
"Law-Firm Life Doesn't Suit Some," by Ashby Jones, The Wall Street
Journal, April 5, 2006 ---
http://www.collegejournal.com/salarydata/law/20060504-jones.html
At most big law firms, the
partner-associate compact goes something like this: The partners
give the associates big salaries, meals on the client, cars home at
night, fancy offices, secretaries and a prestigious name on their
resumes. The associates give their complete professional devotion
and availability -- every hour of the day, every day of the year.
That compact has gone unspoken, and largely
unquestioned, until recently.
More and more associates at law firms
across the U.S. are second guessing whether they want to sign over
their lives to their jobs. Some are working fewer hours. Some are
losing interest in making partner. And they are leaving big law
firms in droves: "The rate of associate attrition we're seeing today
at big firms is the highest level we've ever seen," says Paula A.
Patton, chief executive of the NALP Foundation, a nonprofit group in
Overland Park, Kan., that examines law-firm hiring trends and
practices.
For partners, it's a quizzical and
unwelcome development. Last fall, Cesar L. Alvarez, president of
Greenberg Traurig, was interviewing a student at an Ivy League law
school. The interview was just beginning when the student asked Mr.
Alvarez to tell him what the "lifestyle would be like" at the firm.
The student didn't get a "call-back"
interview. "I told him that if he's going to work at a large law
firm, that mind-set isn't going to get you very far," recalls Mr.
Alvarez, who is based in the firm's Miami office. In his opinion,
the question reflected the attitude of more and more young lawyers.
"A generation ago, nobody would have asked that question, even if
they'd thought of it. But there is a difference in people coming out
of law school now."
Two decades ago, few segments of the work
force routinely put in longer hours than young law-firm associates,
who toiled day and night to please partner-masters and climb the
firms' ranks. But many today "are more interested in going to their
children's soccer games" than they are in staying in the office late
in the hopes of getting extra work done or making a good impression,
says Joseph Altonji, a consultant with Hildebrandt International, a
law-firm consultancy in Chicago.
Ellie Schilling, a former bankruptcy
associate at New York's Kaye Scholer, left the firm in March as a
third-year associate after deciding that the pathway to partnership
"is so long and arduous, that it just didn't seem worth it." She and
her husband, also a young lawyer, plan to depart for Europe this
month to pursue a business plan they began dreaming up after they
realized life at a big law firm wasn't for them. "We figured there
had to be another way to go, a way with less pressure, less stress,
fewer hours," says Ms. Schilling. "We feel like we had to give
something else a shot."
Why the change in attitude? It's partly due
to the explosive growth experienced by the largest firms over the
past two decades. That growth has increased demand for more worker
bees at the bottom of the law-firm pyramid, without an equivalent
spike in demand for new partners, experts say. The result: It's
harder than ever to make partner at the biggest firms, leaving
associates less incentive to churn the grindstone early on.
Partners are working harder than ever as
well, taking a little of the luster off partnership's holy-grail
mystique. Claude Millman, a litigation partner at Proskauer Rose in
New York, says he gets questions from associates about his lifestyle
fairly frequently. And what he tells them isn't always what they
want to hear: "I try to be honest with them," he says. "The pressure
to be available to your clients only increases as your career moves
along."
Generational factors are also at work. More
than in any previous generation, say experts, today's associates
were raised in the lap of affluence. Many have safety nets to fall
back on. And many are jaded about what big law firms have to offer.
Michael Boone, a co-founder of Haynes & Boone, a large
general-practice firm based in Dallas, says that the current crop of
associates often aren't satisfied with working hard and making
money. "They want to feel like they're contributing to the greater
good," he says.
According to an NALP Foundation study
unveiled last year that looked at law firms for the three years from
2002 through 2004, nearly 60% of all entry-level associates at firms
with more than 500 lawyers had left their firms by the end of their
fourth years. For firms of all sizes, it was 62%, a record since
NALP began tracking it nearly 10 years ago.
Some law-firm executives fear that
uncommitted associates are failing to put out the top-quality work
that's expected of them. "There's a perception among managing
partners that the short-termers are less focused on crossing T's and
dotting I's," says Dan DiPietro, head of client sales for the law
firm group at Citigroup Private Bank, a unit of Citigroup Inc., in
New York. "They're perceived as putting a burden on quality
control."
Associate productivity and billing are
additional issues. Greenberg Traurig's Mr. Alvarez, for instance,
says he is hearing about a decline in hours worked at big firms, a
drop attributable not only to the youngest associates, but also to
baby boomers, many of whom are nearing retirement age and winding
down their practices. "It's a double whammy effect," says Mr.
Alvarez. "People in my generation don't need to work 2,500 hours [a
year] anymore, and at the same time, the new generation is concerned
with its lifestyle. It's creating a downward trend at firms."
Some associates appreciate the benefits of
big law-firm life. Moe Keshavarzi, a second-year associate at
Sheppard, Mullin, Richter & Hampton in Los Angeles, says associates
are "very concerned with lifestyle," but he thinks the hours matter
less than the amount of responsibility associates have. "The more
responsibility you're given, the more you're going to want to work
hard."
Several years ago, Greenberg Traurig
changed its recruiting strategy to focus on finding associates who
were better geared for law-firm life, ones with leadership qualities
and work experience prior to law school.
Washington firm Dickstein Shapiro Morin &
Oshinsky, which in 2005 finished first in the American Lawyer
magazine's associate satisfaction survey, has for several years had
a well-publicized part-time policy that lets its lawyers work four
days a week. And it has put a renewed emphasis on training its
lawyers, says Michael Nannes, the firm's managing partner.
Proskauer's Mr. Millman agrees with that
philosophy. "We have to recognize that not everyone is going to want
to spend his or her life at a law firm," he says. "But that doesn't
mean you can't be wonderful associate and get a lot out of your time
while you're here."
Women now make up more than 60 percent of
all accountants and auditors in the United States, according to the
Clarion-Ledger. That is an estimated 843,000 women in the accounting and
auditing work force.
AccountingWeb, "Number of
Female Accountants Increasing," June 2, 2006 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=102218
October 4, 2006 message from Bob Jensen
An encouraging sign in terms of breaking the glass ceiling in
accounting firms has been Deloitte's "Women's Initiative" commenced
12 years ago. Results to date are linked at
http://www.deloitte.com/dtt/section_node/0,1042,sid%253D2261,00.html
WIN 2005 Annual Report Women’s Initiative teams delivered more than 235
programs in 2005 and were honored with seven
national awards. Our number of women partners,
principals and directors rose along with our women
in leadership positions. Learn about these and more
achievements in the 2005 Annual Report.
|
Blog Excerpts One way the Women's Initiative connects with our
people is through the WIN blog on the Deloitte
intranet site. The blog covers personal perspectives
on topics ranging from work/life balance to gender
bias to the power of networking. Read some recent
excerpts.
|
This week Deloitte's program for maintaining training programs
and re-entry initiatives for women who take out time to raise a
family made the national news in a very positive way.
It also helped that Ernst & Young and PricewaterhouseCoopers were
recognized as two of the best (in the Top 10) companies in the U.S.
for working mothers, according to an annual survey by Working Mother
magazine.
Progress in terms of working women and women planning career
re-entry after raising a family is probably greater in
accountancy than in most industries.
Bob Jensen
"E&Y, PwC Top Employers for Working Mothers," SmartPros,
September 27, 2006 ---
http://accounting.smartpros.com/x54886.xml
Big Four accounting firms Ernst & Young and
PricewaterhouseCoopers are recognized as two of the best companies
in the U.S. for working mothers, according to an annual survey by
Working Mother magazine.
Both firms make an appearance in the
magazine's top 10 of "100 Best Companies" list, which celebrates
employers who are "head and shoulder above the mainstream" with
flextime plans, telecommuting, fitness centers, health insurance for
part-timers, and more.
Using five criteria -- flexibility,
maternity and paternity leave, elder care, child care and the number
of women occupying top jobs -- the top 10 are: Abbott Laboratories;
Bon Secours Richmond Health System; Ernst & Young LLP; HSBC USA
Inc.; IBM Corp.; JPMorgan Chase & Co.; Patagonia Inc.;
PricewaterhouseCoopers LLP; Principal Financial Group, and S.C.
Johnson & Son Inc.
Continued in article
Note that among the professions, women accountants are leading the
way! Let’s hope they
clean up the messes left behind by the men.
Women physicians and business managers are on the move up.
Women are soaring in private business ownership and the accounting
profession. There doing better in management and salaries.
But in the law profession it's somewhat downhill.
I guess women are just too honest.
"Do female execs have cleaner hands?" by Stacy Teicher
(Stanford University), Christian Science Monitor, March 15, 2004 ---
http://www.csmonitor.com/2004/0315/p14s03-wmgn.htm
Evidence suggests a link between women and ethical behavior. But they
embezzle more often. In a post-Martha Stewart world, corporate America
sifts conflicting claims. By Stacy A. Teicher | Staff writer of The
Christian Science Monitor.
These problems for women exist in accountancy as well as law
"Firms want women to stay. Men at the firms
want women to stay, and women want to stay. So why aren't they?" asks
Karen M. Lockwood, a partner at Howrey in Washington. "Law firms are way
beyond discrimination — this is about advancement and retention.
Problems with advancement and retention are grounded in biases, not
discrimination."
"Why Do So Few Women Reach the Top of Big Law Firms?" by
Timothy L. O'Brien, The New York Times, March 19, 2006 ---
http://www.nytimes.com/2006/03/19/business/yourmoney/19law.html
Although the nation's law schools for years
have been graduating classes that are almost evenly split between
men and women, and although firms are absorbing new associates in
numbers that largely reflect that balance, something unusual happens
to most women after they begin to climb into the upper tiers of law
firms. They disappear.
According to the National Association for
Law Placement, a trade group that provides career counseling to
lawyers and law students, only about 17 percent of the partners at
major law firms nationwide were women in 2005, a figure that has
risen only slightly since 1995, when about 13 percent of partners
were women.
Even those who have made it to the top of
their profession say that the data shows that women's legal careers
involve distinct, often insurmountable hurdles and that those
hurdles remain misunderstood or underexamined.
"You have a given population of people who
were significantly motivated to go through law school with a certain
career goal in mind," says Ms. Plevan, who notes that Proskauer has
always provided her with a welcoming professional home. "What
de-motivates them to want to continue working in the law?"
FOR years, one pat response to that
question was that once law school graduation rates substantially
equalized between men and women, that pipeline would fuel firm
diversity and cause partnerships to equalize as well. Yet the
pipeline has been gushing for about two decades and partnership
disparity remains.
Although women certainly leave firms to
become more actively involved in child-rearing, recent detailed
studies indicate that female lawyers often feel pushed into that
choice and would prefer to maintain their careers and a family if a
structure existed that allowed them to do so. Some analysts and many
women who practice law say that having children isn't the primary
reason most women leave law firms anyhow; most, they say, depart for
other careers or for different ways to practice law.
"Firms want women to stay. Men at the
firms want women to stay, and women want to stay. So why aren't
they?" asks Karen M. Lockwood, a partner at Howrey in Washington.
"Law firms are way beyond discrimination — this is about advancement
and retention.
Problems with advancement and retention are
grounded in biases, not discrimination."
With law firms courting major corporations
that demand diversity within the ranks of those advising them, and
with women increasingly dominating the top tiers of law school
graduates, veteran lawyers say that promoting women's legal careers
is not just a matter of goodwill or high-mindedness. It's also a
winning business strategy.
. . .
Research conducted by the Project for
Attorney Retention, a program sponsored by the University of
California's Hastings College of the Law, has also identified an
inflexible, billable-hours regime as an obstacle to job satisfaction
for both sexes, a trend that is more pronounced among the most
recent crop of law school graduates. Some veteran lawyers witness
this dissatisfaction firsthand and say that it tugs more powerfully
at women than men because of social expectations about household
roles and child-rearing.
We are very accommodating with leaves and
flexible schedules, and even with that we still lose women," says
Edith R. Matthai, who founded a Los Angeles law firm, Robie &
Matthai, with her husband in 1987. "I think the pressures on women
from spouses, family, peers, schools and others is huge.
"I think the real solution is a
reassessment of the role that women play in the family," adds Ms.
Matthai, who is president of the Los Angeles County Bar Association.
"One thing we need is a sense of shared responsibilities for the
household and, most importantly, shared responsibilities for taking
care of the kids."
Ms. Matthai said that conditions for women
had improved a good deal over the last 30 years, but added: "We have
a long way to go. It's my dream that more women will stick it out in
the law until they get to the fun part, and it just breaks my heart
to see them giving up the dream."
Research conducted by the New York City Bar
Association and other groups indicate that women who temporarily
give up their professional dreams to pursue child-rearing or other
personal goals have a difficult, if not impossible, time finding
easily available on-ramps when they choose to re-enter the legal
world.
Continued in article
Breaking Through the Glass Ceiling: Women Making Strides in Public
Accounting Careers
Women now account for 19 percent of all public
accounting firm partners, up from 12 percent a decade ago, according to a new
study by the American Institute of CPAs . . . Many CPA firms are moving beyond
the up-or-out philosophy of the past. They recognize that choosing an
alternative career path is often a solution for some individuals to help them
cope with children, aging parents or other issues. The study reported, however,
that only 38 percent of the firms surveyed offered some kind of alternative
career path that does not lead to partner, such as choosing to stay as a senior
manager or moving into an area like recruiting that is less client service
driven.
"AICPA: Women Making Strides in Public Accounting,"
SmartPros, February
22, 2006 ---
http://accounting.smartpros.com/x51887.xml
Among
the other findings of the study, included in the committee's
report were:
- Women are gravitating to smaller firms where the trend
of their advancement is more pronounced and where they
represent 47 percent of the workforce compared to 40
percent at larger firms.
- There is a gender gap in the desire for partnership.
Among senior managers only 41 percent of women as
opposed to 65 percent of men expressed the desire to
become a partner.
- Female professionals are less likely to be aware of
networking opportunities, leadership development
programs and practice development training.
- Men in the CPA profession are becoming as interested in,
and as affected by, work/life policies as women. This is
part of a wider, national trend that is becoming
stronger.
- CPA firms that focus on the personal needs of their
professional staff are seeing productivity gains because
motivated employees reciprocate by nurturing the firm's
valued client base.
- Among CPAs in business and industry the two most cited
reasons for leaving public accounting were working
conditions (schedules, hours, assignments) and work/life
issues.
The 80-page report
is available as a PDF document from the AICPA Web Site:
http://www.aicpa.org/members/div/career/wofi/research.htm |
From the Scout Report on May 5, 2006
- Helpers for Working Online from Home
Study finds that full-time stay-at-homes would
make over $130,000 Stay-at-home would be a high paying job [Windows
Media Player] http://msnbc.msn.com/id/12613676/
What a life: Working 9 to 5…and 6 to midnight
http://news.bostonherald.com/localRegional/view.bg?articleid=137678
What is Mom’s Job Worth?
Click Here
Mommy Talk: Misconceptions about Working Moms
http://www.journaltimes.com/nucleus/index.php?itemid=5371
Digital History: Mothers and Fathers in
America: Looking Backward, Looking Forward
http://www.digitalhistory.uh.edu/historyonline/mothersfathers.cfm
Working Moms Refuge
http://www.momsrefuge.com/
Three of the Big Four multinational accounting firms are
among the very top companies of the the world for working moms at Ranks 4/100,
5/100, 8/100
And all four are in the 15-year Hall of Fame for working moms
---
https://www.workingmother.com/working-mother-100-best-companies-winners-2019
The Big Four firms are among the very best companies to work for in
general at Ranks 26/100, 34/100, 36/100, and 44/100
---
https://fortune.com/best-companies/
Job Search Advice and Helpers - http://www.cvtips.com
Executive level international accounting and auditing job openings
are listed at Go here -
http://www.accountingeducation.com/jobs/index.cfm#careercentre
Women-Owned Businesses Growing Twice National Average ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=99089
AccountingWEB.com - Apr-30-2004 - Nearly
half of all privately held firms in the U.S. -- 10.6 million -- are
owned 50 percent or more by women, says a new Center for Women's
Business Research study sponsored by Wells Fargo & Company
(NYSE: WFC).
According to the study, "Women-Owned
Businesses in 2004," between 1997 and 2004 the number of
women-owned firms with employees were estimated to grow over 28
percent, nearly three times the rate of all privately held firms,
and twice the national rate of all firms. Employment grew over 24%,
more than twice the rate of all firms, while revenues increased
about 39%.
"Women-owned firms are growing, and
increasing their employment faster than the general market,"
said Joy Ott, Regional President for Wells Fargo in Montana and
National Spokesperson for Wells Fargo's Women's Business Services
program. "These firms are driving growth in the American
workplace, while generating revenues at a similar rate to all firms.
This is a powerful statement about this fast-growing segment of
American small business owners."
"Businesses that are 50 percent or
more women-owned are growing at twice the rate of all firms, 17% vs.
9%. These businesses are a critical component of the national
economy, not only in terms of their sheer numbers, but also in terms
of their impact on employment and revenue generation," said
Sharon Hadary, Executive Director, Center for Women's Business
Research. "As employers of 19.1 million people, these
women-owned firms spend over half a trillion dollars annually on
just payroll and benefits."
The latest and most complete snapshot of
women-owned businesses in the U.S. also highlights the top 10
fastest growing states for women-business owners. Based on an
average rank 1997 to 2004 growth rates in the number, employment and
sales among privately held, 50 percent or more women-owned firms,
these states are:
1. Utah
2. Arizona
3. Nevada
4. Idaho
5. Kentucky
6. New Mexico (tied)
7. South Carolina
8. North Carolina
9. Arkansas
10. Oregon
The study results offer the most
comprehensive view of the growth and expansion of women-owned
businesses, tracking information like composition, spending habits
and core industries of women entrepreneurs nationwide. It is the
latest resource underwritten by Wells Fargo as part of its Women's
Business Services program, an outreach and education program aimed
at building relationships with women business owners by sponsoring
key community organizations and market research.
Measuring its progress with a new public
goal to lend $20 billion to qualified woman-owned businesses within
ten years, Wells Fargo has lent more than half a billion dollars
since re-establishing the goal in September 2003, and is now
tracking at 150 percent of its pro-rated objective. Since the
program's inception in 1995, Wells Fargo has lent more than $16
billion to women business owners nationwide.
May 4, 2004 reply from Don Mathis (Trinity University
Library.
Very interesting. Have you seen this
article?
Don Mathis
http://money.cnn.com/2004/04/23/pf/women_occupations/index.htm
CNN Money, 27 April 2004
Woman's work? Almost anything
Women continue to make headway in arenas traditionally associated with
men.
By Jeanne Sahadi, CNN/Money senior writer
New York (CNN/Money) This year, for the
first time in the history of Harvard University, the number of women
offered admission to the incoming undergraduate freshman class
outpaced the number of men.
That's just one indication of how far women
have come in their quest to achieve educational and professional
parity with men.
Women now earn more associate's, bachelor's
and master's degrees than their male counterparts. In the academic
year 2001-02, 57 percent of bachelor's degrees and 59 percent of
master's degrees were awarded to women, according to data from the
National Center for Education Statistics.
Women also earned nearly half of the Ph.D.s
(46.3 percent) as well as first professional degrees (47.3 percent),
which include medical, law and dental degrees.
In fact, women's presence is growing in a
number of arenas that traditionally have been associated with men.
Counting the number crunchers
Accounting is a good example of a field
where women have been reaching the majority both educationally and
professionally. According to the American Institute of
Certified Public Accountants, 57 percent of undergraduate degrees in
accounting were awarded to women in 2002.
Today, women account for roughly 59 percent
of accountants, up from about 39 percent in 1983, according to data
from the federal government's Current
Population Survey.
Accounting giant KPMG is recruiting
accordingly. In 2003, 52.3 percent of KPMG's hires from college
campuses were women and overall 48 percent of its new hires for its
accounting and tax professionals staff were women.
That swell in the ranks isn't visible in
the boardroom yet. But the numbers are improving.
Only 13 percent of KPMG's U.S. partners are
women, but that's double what it was in 1998. And among the partners
to be named this year, 22 percent are women, according to KPMG.
More women doctors on tap
In the field of medicine, women are also
continuing to make large strides. Even though they only accounted
for 25.2 percent of all physicians in 2002, that's up from 17
percent in 1990.
And given their growing numbers in medical
school and graduate training programs, it's very possible women will
make up roughly 45 percent of all physicians by 2025, according to
Edward Salsberg, director of workforce studies at the Association of
American Medical Colleges (AAMC).
In the 2002-03 year, women accounted for 45
percent of all medical school graduates. And this year, for the
first time, women made up the majority of applicants to medical
school, according to the AAMC.
Among the specialties, women in 2002 made
up the majority of residents in pediatrics, family practice,
obstetrics and gynecology, psychiatry and dermatology, according to
the Journal of the American Medical Association.
Women lawyers see small drop
The picture in law is not quite as bright.
Women account for roughly 28 percent of all lawyers, according to
CPS data. But that's down from the 29 percent reported in 2002.
Also slightly down is the number of women
enrolling in law schools. For a few years the percentage hovered
around 49 percent, but for the 2003-04 year, that percentage slipped
to 48 percent, according the American Bar Association.
Nevertheless, women accounted for 49
percent of summer associates in 2003, according to research from the
National Association of Law Placement. And women earned 49 percent
of the JDs awarded last year.
At the staff level, NALP found women
attorneys account for 43 percent of associate or staff/senior
attorney positions. But in terms of making partner, women account
for only 16.8 percent of partners at law firms nationwide. Even
though that represents a small increase from 2002, relative to total
headcounts at the firms, women remain underrepresented at the
partner level.
Businesswomen make big strides
In business, women's representation is
stronger than ever, but the number of women at the top is still not
proportional to their ranks.
They account for 50.5 percent of managerial
and specialty positions, according the CPS. But among Fortune 500
companies, women only represent 15.7 percent of corporate officers,
13.6 percent of board directors, 8 percent of those with the highest
titles and 5.2 percent of the highest earners, according to the
research firm Catalyst.
And among Fortune 500 CEOs? Only 1.6
percent a total of eight - are women.
Among privately owned businesses, more
women than ever are at the helm.
Nearly half (46 percent) of all privately
held U.S. businesses are majority owned by women, according the
Center for Women's Business Research.
On the earnings front
Even though there still exists a
significant wage gap
http://money.cnn.com/2004/04/20/news/economy/women_earnings/index.htm
nationally between women and men in the
labor force, an analysis of Current Population survey data by the
Employment Policy Foundation, a public policy research group, found
that the proportion of women earning six figures tripled between
1991 and 2001.
The EPF found that in 2001, one in every 48
women working full-time earned over $100,000. That's up from one in
143 in 1991.
The number of women earning over $60,000
almost tripled during the same period.
The numbers of men earning more than
$60,000 and more than $100,000 also rose, but at much slower rates.
At the same time, the number of women
earning less than $20,000 dropped by one-fifth.
Institute for Women's Policy Research ---
http://www.iwpr.org/
"Breaking B-School Gender Barriers," by Francesca Di Meglio,
Business Week, December 8, 2004 ---
http://www.businessweek.com/bschools/content/dec2004/bs2004121_4063.htm?c=bwmbadec8&n=link1&t=email
Women have made great strides in business,
but the glass ceiling is far from completely shattered. They still
earn less than men, have a harder time getting promotions and venture
capital, and have fewer role models. In addition, women typically
continue to take on most of the burdens at home, which makes it even
trickier for them to juggle a career, too.
Business Schools Target At-Home Moms|
Seeking to tap a pool of professionals who are of
increasing interest to employers, Harvard, Dartmouth and other graduate
business programs are launching executive-education courses geared toward
women who have put their careers on hold to raise families and are ready to
return to the professional world. The new courses aim to help women overcome
the big gaps in their résumés with job-seeking strategies, and also to help
bring them up-to-date on changes in their fields while they were gone. The
new program at Harvard Business School even aims to add a class on business
fashion and makeup. "A lot of women said, 'We don't know what the current
wardrobe is.' It's actually a point of anxiety," says Myra Hart, a professor
of management practice who created the program.
Anne Marie Chaker, "Business Schools Target At-Home Moms: New Programs
Help Women Return to the Workplace After Taking Years Off," The Wall
Street Journal, May 10, 2006; Page D1
Three of the Big Four multinational accounting firms are
among the very top companies of the the world for working moms at Ranks 4/100,
5/100, 8/100
And all four are in the 15-year Hall of Fame for working moms
---
https://www.workingmother.com/working-mother-100-best-companies-winners-2019
The Big Four firms are among the very best companies to work for in
general at Ranks 26/100, 34/100, 36/100, and 44/100
---
https://fortune.com/best-companies/
"Re-entry Programs Target Professional Women," AccountingWeb, May 16, 2006 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=102156
In an effort to reach experienced
professionals, primarily women who leave their positions for
extended periods for personal reasons, and support their return to
their careers, business schools and professional firms have
initiated programs targeted to their needs. Business schools are
offering these programs within their executive education
departments, the Wall Street Journal says. Courses at Harvard’s
Business School and Dartmouth’s Tuck School of Business include
updates on finance and accounting, as well as changes in business
technology.
Firms like Deloitte & Touche and Lehman
Brothers are focused on reaching out to former employees and
providing future support for employees who decide to leave for
personal reasons.
Beginning in the fall, Tuck will offer an
11-day program called “Back in Business: Invest in your Return,”
which is partially funded by Citigroup, a company that hopes to
recruit from the program, the Journal says. Babson College in
Massachusetts will initiate a four half-days program called “Act 2.”
Personal Pursuits, launched by Deloitte &
Touche last fall, allows senior-level professionals up to a
five-year sabbatical for child rearing, elder care and travel, while
providing them with resources, including training, mentoring, career
coaching, networking events and ad hoc work assignments, according
to Shaun Budnik, Deloitte’s national director for the retention and
advancement of women, the Stamford Advocate reports.
“We know we have people we don’t want to
lose touch with,” Budnik said. “The cost of rehiring and retraining
is so much higher than just keeping in touch with them.”
Deloitte estimates that replacing an
employee costs at least twice that person’s salary, while the cost
of the Personal Pursuits programs is $2,500 per employee.
Christine Popson, one of the 28
participants in the first year of the program at Deloitte, was about
to have a second child but after eight years with the firm was
reluctant to leave her senior manager position. “I spent all this
time developing my clients, my relationships at work, myself,” she
told the Advocate. “I didn’t know what the right decision was going
to be: Should I work full time? If I left, how would I stay
current?”
Popson enrolled in the Personal Pursuits
program and expects to take three years off. Through the program,
she can stay connected with technology, a personal concern, and with
her co-workers, the Advocate says.
Lehman Brothers’ Encore Program is directed
toward men and women who have left the workforce and are interested
in resuming their careers in financial services. After a kick-off
event in New York in November, attended by former Lehman employees,
as well as employees of other financial services firms, individuals
applied for and were hired for multiple full-time and flexible
schedule position, Lehman Brothers’ Web site says.
Continued in article
"Accounting Grads See Starting Salary Increase," SmartPros,
July 27, 2004 ---
http://www.smartpros.com/x44487.xml
Average starting salary offers to college
graduates are on the rise, according to the Summer 2004 Salary Survey,
which was recently published by the National Association of Colleges
and Employers (NACE).
--------------------------------------------------------------------------------
Accounting graduates continue to see their
average starting salary increase; they've posted gains in each of the
2004 Salary Survey reports. Currently, they are averaging $41,110, a
1.4 percent gain over last year at this time.
Similarly, graduates in economics/finance and
marketing/marketing management saw their offers increase. The average
starting salary for economics/finance graduates rose 2.1 percent to
$40,906. Marketing/marketing management grads saw their average
starting salary rise to $35,321, a 2 percent increase over last year.
Overall, almost all of the business
disciplines continue to show increases in their average starting
salaries. For example, business administration graduates saw their
average starting salaries increase to $38,188, a 2.9 percent jump from
last year at this time.
"There have been definite signs of
improvement to average starting salary offers for the Class of
2004," said Marilyn Mackes, NACE executive director. "For
instance, at the bachelor's degree level, two-thirds of the
disciplines that reported a percentage change in salary over last year
reported increases."
Management information systems (MIS)
graduates are now averaging $42,098, up 2.9 percent over last year at
this time.
The survey is a quarterly report of starting
salary offers to new college graduates in 70 disciplines at the
bachelor's degree level. The survey compiles data from college and
university career services offices nationwide.
"New BLS Guide Outlines Accounting Trends and Job Outlook,"
SmartPros, April 21, 2004 ---
http://www.smartpros.com/x43328.xml
An increase in the number of businesses,
changing financial laws and regulations, and increased scrutiny of
company finances will drive the growth of accountants and auditors,
according to the Bureau of Labor Statistics.
The 2004-2005 Occupational Outlook Handbook
for accountants and auditors outlines working conditions, employment,
training, earnings and more.
The new edition emphasizes the impact that
new legislation will have on the industry through 2012. BLS predicts
an increased need for accountants and auditors "to address
changes in legislation related to taxes, financial reporting
standards, business investments, mergers, and other financial
matters."
In addition, BLS says "the growth of
international business also has led to more demand for accounting
expertise and services related to international trade and accounting
rules, as well as to international mergers and acquisitions."
Specific trends predicted in the handbook
include the following:
- CPAs will be in high demand due to
increased scrutiny of company finances and accounting procedures.
- Management accountants and internal
auditors will increasingly be needed to discover and eliminate
fraud.
- Government accountants should be in demand
to make government agencies more efficient and accountable.
- Forensic accountants will be needed to
detect illegal financial activity by individuals, companies and
organized crime rings. ("As success rates of investigations
grow, demand will also grow for forensic accountants.")
- Accountants will shift away from tax
preparation due to the increasingly popularity of tax prep
software and tax prep firms.
The handbook also reveals that accountants
and auditors held about 1.1 million jobs in 2002 and earned an average
annual salary of $47,000. Approximately 1 out of 10 accountants or
auditors were self-employed, and one out of five wage and salary
accountants worked for accounting, tax preparation, bookkeeping and
payroll services firms.
For the complete guide, available online, go to
http://www.bls.gov/oco/ocos001.htm
February 26, 2004 message from XXXXX
Bob, do you know of any websites that can
help undecided accounting majors find a career path. We had Blane
Ruschak from KPMG speak in my classes on Tuesday and he mentioned many
opportunities other than Public Accounting, but some of my students
are not interested in the least with public......any threads? I looked
on your website, but may have missed something. Thanks for all you
do.
XXXXX
YYYYYUniversity
"The Discouraging Humanities Job Market, in One Vivid Chart," by Brock
Read, Chronicle of Higher Education, March 4, 2015 ---
https://chroniclevitae.com/news/931-the-discouraging-humanities-job-market-in-one-vivid-chart?cid=VTEVPMSED1
From the Chronicle of Higher Education
Search for Job Openings in Higher Education ---
https://chroniclevitae.com/job_search/new
Because of the short supply (slightly over 200 per year) of new accounting
Ph.D.s hoping to get tenure-track jobs, new Ph.D.s in accountancy are often the
highest-paid new assistant professors on campus. However, one of the factors
holding down the supply of new accounting Ph.D.s is the requirement by
accounting doctoral programs that applicants have professional accounting
experience. Whereas STEM majors in science can enter doctoral programs
immediately after earning BS degrees, this is not usually the case for new
accounting doctoral students ---
http://www.jrhasselback.com/AtgDoctInfo.html
Higher Education Recruitment Consortium ---
http://www.hercjobs.org/
From the Chronicle of Higher Education
Search for the Latest Job Openings in any Discipline of Interest ---
https://chroniclevitae.com/job_search/new?cid=VTECHNJOBSL1
Jensen Comment
When I search for "Accounting" and "Faculty & Research" today there are 256 jobs
posted in the past 30 days. However, not all of these jobs seem property
classified as both "Accounting" and "Faculty & Research." Also I know of some
job openings for accounting professors that are not listed for major
universities.
For persons seeking jobs as accounting faculty in the USA perhaps a better
place to look might be the American Accounting Association Career Center ---
http://aaahq.org/Career-Center
Job seekers may also post their resumes at this center.
Since there are so many faculty vacancies in accountancy, job seekers with
Ph.D. degrees from AACSB-accredited universities are advised to contact colleges
and universities where they would most like to be employed.
How to Mislead With Statistics
Here's how much surgeons, lawyers, and 18 other top-earning professionals
make per hour ---
http://www.businessinsider.com/hourly-salaries-surgeons-lawyers-doctors-2016-11/#-1
Jensen Comment
This articles is one of the best/worst articles I've seen lately on how to lie
with statistics.
Here are a few things to point out to your students if you want to highlight
how not to report survey results.
First and foremost when you define the total populations (apart from sample
sizes) and don't mislead about the sizes of the populations.
For example, the above article says there are 24,000 employed psychologists and
15,650 physicists. Aren't professors and other teachers in these fields
"employed?" There are more employed specialists in these disciplines employed
only in academia than the numbers shown above. Most likely
the average hourly wage would be greatly pulled down if academics were included
in the population and the sample.
Secondly the article ignores standard deviations and kurtosis of the
distributions from which averages are reported. For example, outliers in
millions of dollars of compensation to attorneys and other professionals tend to
skew averages upward. Even medians can be misleading for highly skewed
distributions with outliers on both sides of the medians.
Think of the lawyers who will work for food.
How random are the samples from the populations identified in the study. My
guess is not very random.
Watch definitions.
What is a "chief executive?" The manager-owner of our local hardware store is a
"chief executive" as is the CEO of a Fortune 500 Corporation.
What's the definition of a "financial manager versus a "sales manager?" Why are
there twice as many financial managers as sales managers?
What's the definition of "public relations and fundraising managers" and why are
there only 60,380 of them when there are 531,161 financial managers? Many
financial managers and chief executive officers and are also the public
relations and fund raising managers. My guess is that the sampling population
totally ignored public relations and fund raising managers for colleges,
universities, churches, and charities where compensation is often quite low or
contingent upon funds raised.
What's the difference between a pharmacist and the chief executive. Many
pharmacists also own and manage the entire drug store?
What's "compensation?" Most CEO's of Fortune 500 companies get paid on
performance-based contracts depending upon such things as corporate earnings
reports. In other words what a CEO makes one year may be doubled or tripled the
next year and then taken way down the following year.
What's "compensation?" Most CEOs are paid in many ways including stock
options, stock awards programs, living benefits (use of the corporate jets and
ski chalets), wine, women, and song.
There's an enormous difference between what a
physician makes before or after malpractice insurance and other expense
expenses. Those that work for much lower annual salaries often do not have to
pay their own malpractice insurance, nurse expenses, receptionist expenses,
accounting expenses, office rental expenses, etc.
I could go on and on, but I think students will catch my drift.
This article is so misleading it's worse than
garbage.
"Accounting Doctoral Programs: A Multidimensional Description,"
by Amelia A. Baldwin, Carol E. Brown and BradS. Trinkle.
http://www.academia.edu/532495/Accounting_Doctoral_Programs_A_Multidimensional_Description
Advances in Accounting Education: Teaching and Curriculum Innovations,
Volume 11, 101–128Copyright r 2010 by Emerald Group Publishing Limited
ISSN: 1085-4622/doi:10.1108/S1085-4622(2010)000001100
Accounting doctoral programs have been ranked
in the past based on publishing productivity and graduate placement.
This chapter provides descriptions of accounting doctoral programs on a
wider range of characteristics. These results may be particularly useful
to doctoral applicants as well as to doctoral program directors,
accreditation bodies, and search committees looking to differentiate or
benchmark programs. They also provide insight into the current shortage
of accounting doctoral graduates and future areas of research. Doctoral
programs can be differentiated on more variables than just research
productivity and initial placement. Doctoral programs vary widely with
respect to the following characteristics: the rate at which doctorate
sare conferred on women and minorities, the placement of graduates
according to Carnegie classification, AACSB accreditation, the highest
degree awarded by employing institution (bachelors, masters, doctorate),
Continued in article
Table 1. Accounting Doctoral Graduates by
Program, 1987–2006(Size; 3,213 Graduates).
http://www.academia.edu/532495/Accounting_Doctoral_Programs_A_Multidimensional_Description
Note that I corrected the ranking for North Texas State from the
original table
The average of 161 per year has been declining. In 2013 there were only
136 new accounting doctorates in the USA.
Rank |
Program |
# |
Rank |
Program |
# |
Rank |
Program |
# |
Rank |
Program |
# |
01 |
Texas A&M |
87 |
25 |
Arkansas |
46 |
49 |
Columbia |
31 |
73 |
MASS |
17 |
02 |
Texas |
78 |
26 |
Florida State |
45 |
50 |
Drexel |
31 |
74 |
Syracuse |
16 |
03 |
Illinois |
72 |
27 |
Indiana |
45 |
51 |
Northwester |
31 |
74 |
Wash St. Louis |
15 |
04 |
Mississippi |
70 |
28 |
Tennessee |
44 |
52 |
Cornell |
30 |
75 |
Central Florida |
14 |
05 |
Va. Tech |
70 |
29 |
Texas Tech |
44 |
53 |
Purdue |
29 |
76 |
Cincinnati |
14 |
06 |
Kentucky |
69 |
30 |
Georgia St. |
43 |
54 |
Minnesota |
28 |
77 |
Cleveland St |
14 |
07 |
Wisconsin |
69 |
31 |
Colorado |
42 |
55 |
Oklahoma |
28 |
78 |
MIT |
13 |
08 |
North Texas |
65 |
32 |
NYU |
42 |
56 |
Penn |
28 |
79 |
Fla Atlantic |
12 |
09 |
Arizona |
64 |
33 |
Oklahoma St |
42 |
57 |
Rochester |
28 |
80 |
UCLA |
12 |
10 |
Georgia |
64 |
34 |
Rutgers |
42 |
58 |
So. Illinois |
28 |
81 |
Union NY |
10 |
11 |
Penn State |
63 |
35 |
Alabama |
41 |
59 |
Oregon |
27 |
82 |
Texas Dallas |
09 |
12 |
Nebraska |
61 |
36 |
Va. Common |
40 |
60 |
Texas Arling. |
27 |
83 |
Tulane |
08 |
13 |
Arizona St. |
60 |
37 |
Memphis |
38 |
61 |
Utah |
27 |
84 |
Duke |
6 |
14 |
Houston |
60 |
38 |
Stanford |
37 |
62 |
Baruch |
25 |
85 |
Jackson St. |
6 |
15 |
Michigan St. |
60 |
39 |
Chicago |
36 |
63 |
Connecticut |
24 |
86 |
Fla. Internat. |
4 |
16 |
Washington U |
55 |
40 |
Missouri |
36 |
64 |
Carnegie M. |
23 |
87 |
SUNY Bing. |
4 |
17 |
So. Carolina |
54 |
41 |
No. Carolina |
36 |
65 |
Geo. Wash |
23 |
88 |
Yale |
4 |
18 |
Michigan |
52 |
42 |
So. Calif. |
36 |
66 |
Wash. State |
23 |
89 |
Ga. Tech |
3 |
19 |
La. Tech |
51 |
43 |
UC Berkeley |
35 |
67 |
Kansas |
22 |
90 |
Rice |
3 |
20 |
Ohio State U |
50 |
44 |
Boston Univ |
35 |
68 |
SUNY Buffalo |
21 |
91 |
Tx. San Anton. |
3 |
21 |
Kent State |
49 |
45 |
Maryland |
35 |
69 |
St. Louis |
21 |
93 |
Miami |
2 |
22 |
LSU |
49 |
46 |
Pittsburg |
35 |
70 |
CWRU |
19 |
94 |
Cal. Irvine |
1 |
23 |
Florida |
47 |
47 |
Iowa |
34 |
71 |
Harvard |
19 |
95 |
Hawaii |
1 |
24 |
Mississippi St |
47 |
48 |
Temple |
34 |
72 |
South Fla. |
19 |
96 |
Vanderbilt |
1 |
Jensen
For years prior to 1987 and years subsequent to 2006 you can see the data by
years in a sequence of the Accounting Faculty Directories by James
Hasselback. For example, for years 1995-current go to
http://www.jrhasselback.com/AtgDoct/XDocChrt.pdf
For years prior to 1995 you have to go to earlier editions of Jim's
directories.
There are some minor discrepancies. For example, the above table shows 3
graduates for Rice after 1987 whereas Jim Hasselback shows no graduates at
Rice after 1995. I did not check for all the discrepancies between the two
data sources. Rice no longer has a doctoral program in accountancy. There
are several newer (small) programs such as the one at the University of
Texas at San Antonio.
The Baldwin, Brown, and Trinkle paper goes on to discuss trends over time
in the leading programs and much much more. I did not quote data from their
paper that was not previously provided by Jim Hasselback at
http://www.jrhasselback.com/AtgDoct/XDocChrt.pdf
A few of the many important revelations in the BBT study that might be
noted for 1987-2006:
- The proportion of female accounting doctorates was 38% of the
3,213 graduates over 20 years.
- The proportion of minority accounting doctorates was 4.6% of the
3,213 graduates over 20 years.
- Foreign placement of accounting doctoral graduates whose
location is known is about 14% (including those going back to
Canada)
- Non-academic placement of accounting doctoral graduates whose
employment is know is about 3%. There are very few career advantages
of having an accounting Ph. D. in industry. This is not the case in
most other academic disciplines.
There is much more detailed information available in this study at
http://www.academia.edu/532495/Accounting_Doctoral_Programs_A_Multidimensional_Description
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
"Gender Ratios at Top PhD Programs in Economics," by Galina Hale
and Tali Regev, April 8, 2013 ---
http://econ.tau.ac.il/papers/foerder/2013-10.pdf
The growing concern for the
under-representation of women in science and engineering has prompted an
interest in the mechanisms driving the share of women in these fields,
and in the effect that the gender diversity of the faculty has on the
share of female students. Interestingly, some universities are more
successful than others in recruiting and retaining women, and in
particular female graduate students. Why is this the case? This paper
explores the uneven distribution of female faculty and graduate students
across ten of the top U.S. PhD programs in economics. We find that the
share of female faculty is correlated with the share of female graduate
students and show that this correlation is causal. We instrument for the
share of female faculty by using the number of male faculty leaving the
department as well as the simulated number of leavings. We find that a
higher share of female faculty has a positive effect on the share of
female graduate students graduating 6 years later.
Women are under represented in science and
engineering. In 2010, Men outnumbered women in nearly every science and
engineering field in college, and in some fields, women earned only 20
percent of bachelor’s degrees, with representation declining further at
the graduate level (Hill et al., 2010). In economics, women constituted 33 percent of the graduating PhD
students, and only 20 percent of faculty at PhD granting institutions
(Fraumeni, 2011).
Women in economics have been shown to have
different career paths than men and to be promoted less (Kahn, 1993;
Dynan and Rouse, 1997; McDowell et al., 1999; Ginther and Kahn, 2004).
Focusing on the progression of women through the academic ladder, most
research has failed to fully account for the effect that successful
women in the field have had on the entrance and success of other women.
More specifically, the gross effect that women faculty have on the share
of female students have not been fully explored. In this study we
address this gap in the literature and focus on the causal relationship
between the share of female faculty in top economics departments and the
share of graduating female PhD students.
Continued in article
Jensen Comment
Women seem to be making greater strides in Ph.D. achievements in economics
that in many other science fields. It would seem that they could make
greater strides in fields like computer science where males dominate to a
much higher degree.
In economics at the undergraduate and
masters levels in North America there are significantly more male graduates
than female graduates. Having more female teachers tends to increase the
number of undergraduate majors according to the above study.
In accounting at the undergraduate
and masters levels in North America there are significantly
more women graduates than men, and the large
CPA firms hire more women than men. There is a possible glass ceiling,
however, in terms of newly-hired CPA-firm women who eventually become
partners. That is a very complicated story for another time other than to
note that the overwhelming majority of newly-hired males and females in
large CPA firms willingly leave those firms after gaining experience and
very extensive training.
Many of those departures go to clients of CPA firms where the work tends
to have less travel and less night/weekend duties as well as less stress. In
my opinion most accounting graduates who go to work for CPA firms did not
ever intend to stay with those CPA firms after gaining experience and
training. This accounts for much of the turnover, especially in large CPA
firms. Turnover has an advantage in that it creates
more entry-level jobs for new graduates seeking experience and extensive
training.
Bob Jensen's threads on the history of women in the professions ---
http://faculty.trinity.edu/rjensen/bookbob2.htm#Women
Bob Jensen's threads on careers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
In my accounting classes I always brought up the topic of the great
career opportunities of getting an accounting doctoral degree and
becoming an accounting professor. There is a projected dire shortage of
accounting faculty that is projected to get worse in the future, thereby
leading to accounting professors on average being the highest paid
professors on campus with compensation packages to new graduates at
nearly $200,000 per year, two-course teaching loads, and summers free
for research.
The American Accounting Association (AAA) has a new research
report on the future supply and demand for accounting faculty. There's a
whole lot of depressing colored graphics and white-knuckle handwringing
about anticipated shortages of new doctoral graduates and faculty aging,
but there's no solution offered ---
http://aaahq.org/temp/phd/AccountingFacultyUSCollegesUniv.pdf
When I speak to my students about careers, I generally commence by
truthfully pointing out the good and the bad of such a career move ---
http://faculty.trinity.edu/rjensen/Theory01.htm#DoctoralPrograms
Accounting and finance professors probably have it a bit better than
most other college professors because there is high demand for these
specialties coupled with short supply. Hasselback's Accounting
Faculty Directory reveals that the number of new doctoral faculty in
accounting actually declined from 200 in 1993 to 74 in 2000. This
decline not only created a shortage of supply in academe, but it also
reveals that more accounting professionals do not seek doctoral degrees
because they are happy with there life as accountants in the working
world (as opposed to the ivory tower where I've never been certain that
what we do should really be defined as "work.")
What I next tell my students is that if they don't want to be like me
and prefer to work for a living, accountancy offers some
great, great opportunities that make it one of the most popular majors
on campus. First I emphasize that most of the top graduates start
out in public accounting with CPA firms because CPA firms offer the most
entry level opportunities for getting a job, getting training, meeting a
wide variety of interesting clients, working with some great
professionals, and growing up. Students with more than one
language skills have great opportunities for foreign assignments.
But I always stress how most people who take their first jobs in CPA
boot camps generally branch out later on into industry (often with one
of their clients), the government (often with the IRS or FBI),
not-for-profit organizations (all levels of government and
education). Many of those opportunities either require or
recommend that applicants have CPA credentials and prior
experience. There are increasingly popular opportunities in such
areas as forensic accounting and fraud examination ---
http://www.cfenet.com/home.asp
. Accounting students interested in the FBI might want to read the
John Douglas Guide to Careers in the FBI
http://www.911hotjobs.com/bookstore/pn54.htm
or The Most Adventurous Careers of the 21st Century! at
http://www.thinkquest.org/library/site_sum.html?tname=3340&url=3340/INTSEC.HTM
Then I stress that in the business world having an accounting major
is a fast track to advancement since it is difficult to run a business
unless you know how business keeps score. Even those with finance
or marketing backgrounds find that they have to learn a whole lot more
about complex accounting rules and strategies in order to advance up the
corporate ladder.
Then I stress how there are many consulting opportunities
accountancy. Many accountants have full time careers in financial
advising, expert witness testifying, information systems consulting,
etc. I generally stress that the most important thing to combine
with accounting as a major is information systems, particularly
knowledge of database systems and computer communications.
One accountant (video) who went back to school in a doctoral program and
became a professor:
Accounting professor stars in AICPA Foundation video ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=104022
"IT Consulting Fades From CPAs’ Radar Screens," AccountingWeb,
April
http://www.accountingweb.com/cgi-bin/item.cgi?id=102014
Firms are being lured away from IT
consulting to focus more attention on attest related services, where
market demand has been stoked by the increased financial reporting
requirements in the Sarbanes-Oxley accounting reform law. “Firms are
doing a good job of building practices around that because that’s
compliance work and something that clients have to do. Firms are
embracing this intellectually in way they could not for IT,” he
says.
Meanwhile, the IT world has moved away from
CPAs by converting many of its products and services to Web-based
platforms, which allow end users to download them on line, rather
than having applications physically implemented on their computer
systems by CPAs and other technology advisors, Eagle says. The ITA
has responded by adding training sessions in which practitioners
discuss how they have changed their IT practices to accommodate
Web-based products and services.
In addition to the Web-based sales, some IT
products for the smallest companies have been moved more toward
being packaged for sales on retail store shelves, Eagle adds.
“Vendors want to create software that works out of the cellophane
wrapper. Between that and the ASP (Web-based application service
providers) movement, the role of the implementer is fading,” he
says, summarizing what many IT implementers have long known.
He notes that, if anything, the bulk of
smaller firms’ IT work in the future will be advisory roles helping
clients put together requests for proposals from software vendors.
The larger firms will increasingly use their specialized vertical
industry practices to deliver IT products and services tailored for
those vertical industries, he predicts.
Continued in article
Jensen Comment
At the same time we see a surge in CPA consulting in "risk advisory
services" that covers a broad spectrum of risk concepts. For example,
KPMG's overview of such services is at
http://www.kpmg.com/services/content.asp?l1id=90&l2id=520
Good accounting career information magazine ---
http://www.newaccountantusa.com/default.html
The AICPA has a great Website for careers ---
http://www.aicpa.org/temp/jobres.htm
CPA
Career Center AICPA members can search job postings, locate great candidates
for open positions, assess personal strengths and development
needs and access other career-related resources. |
AICPA
Classifieds Online Browse classifieds online including employment opportunities,
products, services, and web site classifieds of interest to the
CPA/accounting community. |
Landing
a Job Students can find out in-depth information about career paths,
hiring trends, internship opportunities, and much more. |
The Institute of Management Accountants has various career links ---
http://www.imanet.org/ima/index.asp
The Institute of Internal Auditors provides career information ---
http://www.theiia.org/
The IRS has a great career site at http://www.jobs.irs.gov/
Incidentally, one of the perks of working with the IRS is continuing
education at 24 or more top colleges and universities that provide IRS
employees with free courses leading to degrees and certifications ---
see http://snipurl.com/IRSuniv
-
Then I recommend some of the top accountancy career inspirational
sites listed below:
-
Note from Bob Jensen: There are huge geographical
variations in compensation. I would guess that most five-year
accounting graduates today are starting at over $40,000. Many
are starting for more than $50,000. Clerical accountants earn
far less. Many "accountants" at the clerical level
were not accounting majors in college, and some were not even
college graduates. Opportunities for clerical accountants will
probably dry up over the next two decades, whereas opportunities for
accountants and accounting educators remain bright in spite of the
fact that the numbers of accounting graduates are declining.
Accounting opportunities will be highest for students who combine
accounting, finance, MIS, and IT skills, and that combination of
skills is a tall order for five or six years of college.
As educators, we can help by fostering more innovative curriculum
revisions that are not dictated as heavily by CPA examination
coverage. Some innovative programs (e.g., the accounting
education programs at Notre Dame and the University of Illinois) are
making great strides at revising graduation requirements.
My warning to students is that beginning compensation should not
be the main criterion for virtually any professional career.
Computer programmers have very high starting salaries, but the path
toward the executive dining room is probably much longer than the
path from the accounting staff room. The path is even shorter
from the cubby hole given to the external auditing team. I
call that path turnpike to executive dining room in a large
corporation. Of course the highest paid graduates under 30
years of age will continue to be those "fools" who were
willing to work for almost nothing in a startup technology venture.
But then all "fools" do not necessarily win the jackpot.
Students interested in a career in accounting can find all the
answers they need with just one click of the mouse. The Illinois CPA
Society announces the launch of an exciting new Web site that is
devoted to providing students of all ages with valuable resources
and the latest accounting career information.
http://www.accountingweb.com/item/60145
- The flashy link is at
http://www.futurecpa.org/futurecpa/index.htm
Career site for the Maryland Society of CPAs ---
http://www.tomorrowscpa.org/
The Wall Street Journal has launched CollegeJournal, a free site
for undergraduate, graduate, and MBA students providing job- search
and career-guidance information. Content is supplied by The Wall
Street Journal's editorial resources as well as an editorial team
dedicated to the CollegeJournal.
http://www.accountingweb.com/item/60143
There are many other places to look for career opportunities in
accounting. Examples are listed below:
http://www.aicpa.org/nolimits/index.htm
http://www.rutgers.edu/Accounting/raw/ima/students.htm
http://www.accounting.com/
http://www.accountingjobs.com/
http://www.careerbank.com/
http://www.tax-jobs.com/
http://www.financialjobs.com/
http://www.jobexchange.com/
And there are some other helpful sites.
-
http://www.uwm.edu/~ceil/career/jobs/index.html
(from our good friend Ceil Pillsbury)
http://www.accountingstudents.com
http://www.accountingweb.com
http://www.careers-in-business.com/
http://www.rutgers.edu/Accounting/raw/aaa/placemnt.htm
(for higher education)
http://www.accountingeducation.com/
http://members.tripod.com/kibrahim/contents.html
(International)
http://dir.yahoo.com/Social_Science/Economics/Accounting_and_Auditing/Employment/Jobs/
Some Accounting Career Information from SUNY- Fredonia ---
http://beech.ait.fredonia.edu/careers.htm
This is a great website with lots of useful
links about accounting careers, continuing education, and
certification specialties.
In particular, note the Accounting Career Information Link at
http://beech.ait.fredonia.edu/careersac.htm
AICPA Book Tells Firms, Women How to Shatter the Glass Ceiling ---
http://www.smartpros.com/x37850.xml
The AICPA reports that during the last 20 years
the proportion of women entering the accounting profession has grown
dramatically from 45 percent in 1982 to 56 percent in 2002. However,
women represent only 38 percent of the new hires and a mere 14 percent
hold the position of partner, shareholder, or owner of their firm.
Promoting Your Talent by Professor Nancy
Baldiga, associate professor of accounting at the College of the Holy
Cross in Worcester, Massachusetts, sheds light on this imbalance. The
book features interviews with more than 50 successful women, human
resource directors, and managing partners about the obstacles faced by
women and the practices that both women and firms can adopt to help
facilitate advancement in the accounting profession.
Prepare Your
Students for the Unexpected
"The
Strangest Job Interview Questions," SmartPros, December 11,
2003 --- http://www.smartpros.com/x41717.xml
MENLO PARK,
Calif., Dec. 11, 2003 (SmartPros)
— Think you're ready for any question that comes your way in a job
interview? Staffing service OfficeTeam recently asked executives for the
strangest questions they had been asked by hiring managers during an
interview. The responses ranged from unusual to outrageous.
"As firms
involve more people in the hiring process to get a clearer snapshot of a
candidate's abilities and personality, some unexpected questions are
bound to emerge and surprise even the most well-prepared
candidate," said Liz Hughes, vice president of OfficeTeam.
Interviewers may
use icebreaker questions like the following to begin the meeting:
"What's
your favorite color?"
"If you could be any animal, what would you be?"
"If you were having a dinner party and could invite three famous
people, who would they be?"
"What's the last book you read?"
Hughes noted that
the interviewer is interested in the "why" behind the
applicant's answer because it often sheds light on his or her
personality. "The reason given for citing a particular book or
dinner guest, for instance, could prompt conversation that a resume or
skills-based interview question
alone would not."
Other questions
may reveal a job candidate's aspirations:
"What did
you want to be when you were 10 years old?"
"What classes did you like in high school?"
"Do you see yourself in my position in the future?"
With these
questions, hiring managers aim to understand the applicant's goals and
ambitions over time. Hughes offered the following example: "If
someone wanted to be a lawyer in high school, but opted for a career in
sales, what led to the change?" The hiring manager also wants to
find out how quickly the candidate expects to advance in the
organization, and the importance he or she assigns to rank and title.
The last set of
unusual questions executives were asked seems to defy classification:
"Why are
manhole covers round?"
"What would
I find in your refrigerator?"
"Do you
have air conditioning at home?"
"How will taking this job change your life?"
"What made you move to a backward city like this one?"
Is the hiring
manager intentionally trying to throw a candidate off track? Possibly.
"Asking a truly unexpected question will likely elicit a candid,
unrehearsed response," Hughes said. "As a bonus, the hiring
manager will get a better sense of the person's sense of humor and
ability to think quickly."
How should
candidates approach questions that seem to come from left field? Hughes
offers the following tips:
- Do some
homework ahead of time. Ask people in your network about the strangest
questions they were asked in an interview, how they responded to them,
and what -- if anything -- they would have done differently. The point
is not to prepare for every question but to practice thinking on your
feet.
- Ask for
clarification. If you don't understand a question, rephrase it by
saying, "Do you mean ... ?" or ask for more detail. This
will put you on the same page as the hiring manager and enable you to
provide a targeted response.
- Don't let
nerves get the best of you. Feeling stress during an interview is to
be expected. Excessive stress, however, could cause you to ramble, or
give only "yes" or "no" answers. If you need a
moment to think about a question, ask for it.
- Don't assume
the worst. You may meet with many interviewers at a company, some less
prepared and experienced than others. Be patient with each successive
meeting, even when the same questions are being asked multiple times.
Your calm demeanor will count in your favor in the final selection.
Public Accounting Report has
published its annual ranking of America's Top 100 Accounting Firms, and
it's no surprise that Andersen, the previous number five ranked firm, is no
longer on the list.
http://www.accountingweb.com/item/95611
- PricewaterhouseCoopers:
$8,056.5 million
- Deloitte
& Touche: $6,130 million
- Ernst &
Young: $4,485 million
- KPMG: $3,171
million
- Grant
Thornton: $432.5 million
- BDO Seidman:
$353 million
- BKD: $210.9
million
- Crowe,
Chizek & Co.: $204.7 million
- McGladrey
& Pullen: $203 million
- Moss Adams:
$163 million
"Second Six: Ready to Step Up?" CFO.com ---
http://www.cfo.com/specialreport/0,5487,564||A,00.html
As contributing editor Ed Zwirn reveals in his
article ''The
Second Six: Ready to Step Up?'', the demise of Andersen and the
advent of Sarbanes-Oxley have not been an unqualified blessing for those
firms that remain. And in ''Same
Straw, Smaller Back,'' Zwirn notes how new regulatory burdens
that fall heavily on smaller companies (the usual Group B clients) may
persuade many of them to go private.
From Smart Stops on the Web, Journal of
Accountancy, September 2006 ---
http://www.aicpa.org/pubs/jofa/sep2006/news_web.htm
CAREER BUILDING
SITES
Value for Your Business
http://bvfls.aicpa.org
The AICPA’s Business Valuation and Forensic Litigation Services
Center offers members case studies on fraud schemes, a practice
management toolkit and a definition of the month. Read the full text
of an exposure draft on valuation service standards and get tips on
how to conduct an inquiry interview or an interview with a CEO or
CFO. Help your clients develop internal controls with a risk
management checklist and a list of common auditing deficiencies.
Answers for Accountants
www.forensicaccounting.com
CPAs interested in switching to investigative and forensic
accounting can get an overview here from Alan Zysman, CA and
certified fraud examiner, of Toronto’s Zysman Forensic Accounting
Inc. His to-the-point e-site offers a detailed explanation of what
it takes to become a forensic accountant and how to approach
assignments. Also get an overview of investigative accounting and
litigation support.
A Valuable Site
www.bvresources.com
Looking for information and news on business valuation? Visit this
Web stop for BVWire, a free weekly update with the latest valuation
court cases, practice tips, a definition of the week and questions
and answers on valuations of start-ups. There’s also free downloads
of IRS BV guidelines, an international glossary of terms and free
issues of the newsletter Business Valuation Update, as well
as links to other BV associations such as the AICPA and the
Appraisal Foundation.
What’s It Worth?
www.cbiz.com
The e-calculators here can help you determine cash flow, financial
ratios and business valuation as well as estate tax, retirement
planning, investment returns and 401(k) savings. The Tax section has
a 1040 calculator and the Tax Planning Update newsletter
offers advice on how to reduce estate taxes and draft buy-sell
agreements. Users also can get marketing tips and links to franchise
and small business opportunities.
M&A How-Tos
www.mergerplace.com
Free membership to this e-stop gets CPAs and their entrepreneurial
clients a valuation guide with tips on business appraisals and
pitfalls associated with them. Users can find a due diligence
checklist, simple- and long-form nondisclosure agreements and a
buyer profile. The Resource Center offers the M&A Advisor
with archived articles on e-mail strategies during an M&A, “Lessons
for Dealmakers” and tips on small business valuations. Business
Planning Tools includes sample business and marketing plans and
e-calculators to determine cash flow and start-up costs.
Tips for Tenderfoots
www.tannedfeet.com
Whether you’re starting an at-home business or just need a refresher
course on the rules of the game, this entrepreneurs’ e-page offers
checklists for starting a business, marketing plans, tips on how to
write a contract and small business tax deductions you may be able
to claim. Visitors also can find articles, links and discussions on
immigration law and intellectual property, and advice on buying,
building or leasing office space. Get a laugh or two in the Business
Humor section as well.
AACSB Career Guides
-
AACSB
International, the premier business school accreditation agency
worldwide, has more than 925 higher education members. These
colleges and universities employ a significant number of
business school faculty.
What's
happening in the b-school employment marketplace? Visit M.E.
Jobs, AACSB's powerful online Web site for business school
faculty and higher education administration employment
classifieds at http://www.aacsb.edu/jobs2.
Why
M.E. Jobs? The only site dedicated solely to management
education, M.E. Jobs offers user-friendly features:
- Jobs displayed by locations and category
- Links to designated contact persons
- Links to school Web pages
- Printable position descriptions
- Access to a world-wide market
- Email ads to a friend
- No cost to job seekers, easy to use
For
additional information, email kim@aacsb.edu |
-
Question:
What is NACElink and why is it important to college students and faculty as
wells as employers?
Answer:
NACElink
is the result of an alliance between two nonprofit associations—the
National
Association of Colleges and Employers (NACE) and
DirectEmployers Association, Inc.—and an initial collaborating
group of career centers. NACElink was launched in August 2002 with
27
schools from across the country involved in the initial development
and testing.
During
the 2002-2003 academic year, additional schools from the diverse NACE
membership of 1,800 colleges and universities will have the opportunity
to use the NACElink system and discover its benefits.
The NACElink
System
NACElink
currently offers a job posting and resume data base component. An
interview scheduling component is in beta testing and will be released
in 2003.
The
NACElink homepage is at http://www.nacelink.com/
I
had the honor, along with my colleague John Rice, of having an article in the
first edition of New Accountant many years ago.
"The Times are
Changing," New
Accountant, Vol. 1, September 1985 (Lead Article in a New Journal,
pp. 7-14)
This
magazine's target market is accounting majors about to make career
decisions. I just received the following message announcing a new Website
for New Accountant.
New Accountant
Magazine Website
Over 100
articles and growing!
Click on logo
or link http://www.newaccountantusa.com
If your school
is not listed, please let us know and we will add the link.
If you prefer
to be removed from our email list, please email us let us know. We
apologize for any inconvenience.
New Accountant
Magazine
3550 W. Peterson Avenue
Chicago, Illinois 60659
Toll free: (888) 641-3169 Fax: (773) 866-9881 Email:
RencPublishing@earthlink.net
September 6, 2002 message from AACSB International - Communications
[comm@AACSB.edu]
And now we are
your source for Worldwide Jobs in Management Education.
M.E. Jobs -
http://www.aacsb.edu/jobs/default.asp
- is an ONLINE career marketplace for professionals in management
education jobs that provides:
A user-friendly
and immediate format Accessibility to job postings from our over 900
member schools Most ads were posted within the last 30 days - no job
over 90
February 2003
The Massachusetts Society of
CPAs has launched its newest
student recruitment
initiative, CPATrack.com.
This comprehensive Web site
targeting both high school
and college students is
designed as a place for
students to explore
accounting education and
career opportunities.
http://www.accountingweb.com/item/97127
The CPA Track Website is at
http://www.cpatrack.com/
Note that students may post resumes at this site and join a student
forum.
This includes the academic job market around the world.
The Internet's largest job listing site sends an e-mail to its users
warning about the possibility of identity theft from fake help-wanted ads
posted online ---
http://www.wired.com/news/business/0,1367,57852,00.html
The job sites generally advise users not to
give out their social security, credit card or bank account numbers, not
to disclose personal information that isn't related to work such as
their marital status, and to be particularly careful of prospective
employers from outside the country.
March 31, 2004 message from Dr James Fowler III
[drjamesfowler@pcsservers.net]
- As part of a search I used the academic job site
Academic Careers Online and really liked it.
- You can search or announce faculty, post doc,
researcher, library, endowed chair, and administrative jobs at colleges,
universities and research institutes anywhere.
-
- Applicant can use all their services without being
charged and employers can post a job listing for up to three full months for
US$ 175 (CAD 234). This even includes a unique email alert system that
notifies applicants when a job matching their search criteria is posted.
-
- To see the site go to
www.AcademicCareers.com
- Regards,
- Jim
- Dr. James Fowler III
Jim@Drjamesfowler.com
"COOL"
CAREER SITES:
www.cpazone.org—Created
by the Pennsylvania state society, the site contains interactive
games, career information and prizes.
www.tomorrowscpa.org—The
Maryland society’s site contains information for students about
the accounting profession.
www.incpas.org/Students/index.htm—Using
a nautical theme, the Indiana society’s Web page helps students
“guide their way” to becoming a CPA.
www.calcpa.org/community/careers/index.html—The
California society’s student Web page contains excellent profiles
of young CPAs. The site also offers to tailor articles based on your
needs.
www.futurecpa.org—The
Illinois society’s Web site is full of fun and important
information.
CPA2Be.org—Web
site of the Kansas state society, a comprehensive site for students.
Diversity Poll Identifies Top-Ranked Accounting Firms
A survey by The Black Collegian magazine of more than 2,300 African, Asian,
Hispanic, and Native American undergraduate and MBA students found that
corporate diversity is a critical factor for minority students in deciding upon
employers, and several major accounting firms are among the companies that excel
in this area. http://www.accountingweb.com/item/73983
From Information Week Daily on February
15, 2002
**Major
Companies Ready New Online Job Site
A new
employer-backed online job board could be to Monster.com and
HotJobs.com what airline-backed travel site Orbitz is to
Travelocity and Expedia. DirectEmployers.com, to be unveiled
Tuesday, is backed by more than 15 international companies,
including IBM, Intel, Lockheed Martin, Nestle, Raytheon, Sprint,
and Unisys. Participants span industries from advertising to
aerospace.
The site,
run by the E-Recruiting Association, a nonprofit established by
senior human-resources execs from the participating companies,
will offer a gateway to companies' own recruiting Web sites,
cutting out the commercial online recruiting sites in the online
job-seeker strategy.
Monster,
Yahoo Inc.'s HotJobs, and thousands of other online recruiting
sites receive the majority of their revenue from companies using
their service to post job advertisements. But Monster won't lose
its pre-eminent position just yet, thanks in part to massive brand
strength, says Chris Boone, International Data Corp.'s
E-recruiting analyst. "There would have to be a huge,
critical mass of companies to make a dent in Monster.com's market
share," he says, noting the job board's Super Bowl commercial
as only one aspect of its million-dollar marketing campaign.
Online
recruiting is one of the most profitable ventures for the
Internet. Earlier this week, Yahoo completed its acquisition of
Monster competitor HotJobs. The Internet portal won HotJobs in a
successful hostile bid against Monster to diversify its revenue
channels. - Elisabeth Goodridge
For more,
see: Yahoo To Scoop Up HotJobs
http://update.informationweek.com/cgi-bin4/flo?y=eF3w0BcUEY0V20BVcJ0Au
Best
Practices For E-Recruiting
http://update.informationweek.com/cgi-bin4/flo?y=eF3w0BcUEY0V20BWh20Ac
SmartPros 2002 (Accounting) Career Guide ---
http://www.smartpros.com/x33919.xml
Facebook for Student Recruiting
March 5, 2007 message from Barry Rice
[BRice@LOYOLA.EDU]
I have suggested to my Accounting
Department colleagues that Loyola should consider using Facebook as
a tool to help recruit accounting majors. Perhaps we could set up a
group called "Accounting as a Major" or "Why Major in Accounting?"
or whatever. Facebook has a tool called "Create Related Event" that
could be use to publicize meetings, etc. Have any of you looked into
using Facebook in this way? Anyone using it for Beta Alpha Psi?
Barry Rice AECM Founder
E. Barry Rice, MBA, CPA
Director, Instructional Services
Emeritus Accounting Professor
Loyola College in Maryland
BRice@Loyola.edu
410-617-2478 www.barryrice.com
Facebook me!
http://www.facebook.com/p/Barry_Rice/20102311
-
-
-
- Accounting Temps' complete listing of accounting and finance
salaries ---
http://www.accountemps.com/ResourceRequest?salaryGuide=true
-
Find the Perfect Job
www.jobfactory.com
Finding a new job or changing careers just got a
lot less stressful. This site features JobSpider, a search engine
for positions by title and location, as well as JobFactory’s own
list of 250 top career sites. Plus, users can find links to more
than 23,000 Web sites that post available jobs and want ads from
most online U.S. newspapers.
Career Guide to Industries -- Bureau of Labor
Statistics --- http://www.bls.gov/oco/cg/
CPA net --- http://www.cpanet.com/
eChoices ---
http://www.echoices.com/eChoices/ecIntro.nsf?OpenDatabase
eRecruiting ---
http://www.erecruiting.com/er/security/no_cookie.jsp
Hoovers Business Finder ---
http://premium.hoovers.com/subscribe/
From Working Mother Magazine
in September 2002 ---
http://www.workingmother.com/list.shtml
Abbott
Laboratories *Top Ten, *Best in Industry
American
Express *Top Ten
Bank
of America, N.A. *Top Ten
Booz
Allen Hamilton *Top
Ten, *Best in Industry
Bristol-Myers Squibb
*Top
Ten, *Best in Class
Colgate-Palmolive
*Top Ten
Computer Associates
*Top
Ten
Fannie Mae *Top
Ten
General Mills
*Top Ten, *Best in
Industry
IBM
*Top
Ten, *Best in Industry
Also included in the Top 100
companies are the following:
Deloitte
& Touche
Ernst & Young
KPMG
PricewaterhouseCoopers
-
-
www.Bookkeeperjobs.com
and www.AccountingBoard.com
are now linked. If this has reached you in error please forward to
the proper person. Bookmark these sites and watch them grow.
Accounting Professional Site Links
The CPA Team
http://www.cpateam.com/
Hi Kay,
Fist I might warn you that most salary surveys (for men and
women) are badly out of date. The maximum salaries listed are often
less than the starting salaries for our current accountancy
graduates. Also, clerical accounting usually gets mixed in with
public accountancy and higher-level professional careers in
accountancy. This is especially problematic in studies of accounting
salries for women since such a high proportion of working clerical
accountants are women (for reasons that I won't go into here).
I will make you do some of the work. You will find quite a few
interesting hits if you search for "AICPA Statistics
Women" without the quote marks in the "All the words"
box at
http://www.google.com/advanced_search
I think you will find other interesting hits with other
combinations of words at the above site. For example, try
"AICPA Careers Women".
Also note the following links:
Big Five firm PricewaterhouseCoopers has retained its top 10
spot on Working Mother magazine's annual list of the "100
Best Companies for Working Mothers." The other Big Five firms
are represented on the Top 100 list as well. Find out what it
takes to make the grade.
http://www.accountingweb.com/item/60271
Deloitte & Touche is out to prove it is still the number
one firm when it comes to Big Five recognition of female
employees. The firm expects to double its female partner and
director ranks over the next five years.
http://www.accountingweb.com/item/48313
Promoting women CPAs (certified public accountants) (an analysis
of the report of the Upward Mobility of Women Special Committee) ---
http://www.nysscpa.org/cpajournal/old/07551184.htm
American Society of Women Accountants ---
http://www.aswa.org/
Occupational Outlook Handbook ---
http://stats.bls.gov/oco/oco1001.htm
High Paying Careers for Women ---
http://www-instruct.wccnet.org/~kstrnad/career/nontrad.html
Women on the Move ---
http://www.insight-mag.com/insight/00/02/art-12.htm
Ceil's great site ---
http://www.uwm.edu/~ceil/accounting/index.html
A Bentley College Site ---
http://ecampus.bentley.edu/dept/ocs/grad/listing.html#ACCOUNTING%20CAREER%20RESOURCES:
Statistics regarding accounting and finance careers for women in
the military are available at
http://www.militarypartners.com/Links/Military_Lifestyle/Women.htm
Huge Database --- http://www.accountantsworld.com/list/default.asp?adv=google&tar=cpa
Linked from
http://www.accountantsworld.com
-
I might note a few excerpts (a sampling only) from previous
editions of my weekly newsletter called New Bookmarks at
http://faculty.trinity.edu/rjensen/bookurl.htm
From the Harvard Business School American Women in the Emerging
Industrial and Business Age
http://www.library.hbs.edu/hc/unheard_voices/
A Web Site for Women
www.ivillage.com
A Gender Gap in Startup Funding What do women want? For starters,
greater access to venture capital, according to a new survey
http://www.businessweek.com/smallbiz/content/dec2001/sb20011214_3179.htm?c=bwfrontierdec18&n=link1&t=email
Women in Academe – Still Hungry After All These Years ---
http://www.aaup.org/pr01613.htm
"Women impeded by tech downturn," by Peter Deleveti,
San Jose Mercury News, October 29, 2001 ---
http://www.siliconvalley.com/docs/opinion/wiretap/pd103001.htm
Choices are Not So Great for Many Women More women are going
online to seek an education. But technology isn't freeing modern
women already working two shifts -- it's adding a third shift in the
home, according to a new report ---
http://www.wired.com/news/school/0,1383,46689,00.html
Women Engineer Tech Success ---
http://www.wired.com/news/women/0,1540,43413,00.html
MentorNet founder Carol Muller finds working women to help female
students explore technical vocations. But getting the education and
the job is only part of the battle for equality.
"Earning Differences Between Women and Men"
http://www.dol.gov/dol/wb/public/wb_pubs/wagegap2000.htm
Women on the Web" winner Patricia Beckman has created
animation for everyone from Dreamworks to ABC ---
http://www.wirednews.com/news/culture/0,1284,43239,00.html
Women In American History ---
http://www.britannica.com/women/
Hope this helps!
Bob Jensen
-----Original Message-----
From: Kay Henry
[mailto:henryk@rice.edu]
Sent: Friday, February 01, 2002 3:46 PM
To:
rjensen@TRINITY.EDU
Subject: Referred by David Albrecht
Professor Jensen:
David Albrecht thought you might have
some information or statistics on women in accounting. Our
complete correspondence is below (including a compliment for
you!), but my basic question is this:
Do you know where I could get the latest
statistics on percentages of women CPAs and women accounting
graduates at the Bachelor's and Master's level? The study on the
American Women's Society of CPAs website is dated 1996, and I
couldn't find any statistics on the AICPA website.
I am presenting this weekend to a
regional meeting of the AWSCPA. Any information you have would be
most welcome.
Many thanks,
Kay Henry
Director, MBA for Executives Rice University
Although
it is more directed to careers in finance, see Jobsinthemoney.com
http://www.jobsinthemoney.com/
What is happening in selected industries?
Valuation Resources ---
http://www.valuationresources.com/IndustryReport.htm
This is a helpful Website for researchers and practitioners.
Industry Resources Reports
Industry Resources Reports list resources
available from trade associations, industry publications, and
research firms which address subjects such as industry overview,
issues, trends, and outlook, financial benchmarking, compensation
surveys, and valuation resources.
Each entry in a category contains the
name of the source organization, the name of the particular
resource, a hyperlink to the source organization website, a brief
description of the resource, and a description of any information
that is provided free online. The user can check the website or
contact the source organization for additional information and
product pricing. In some cases, the resource may not be available
on the website but can be obtained by calling the source
organization using the phone number provided on the website.
One of the many industries covered is SIC 8721
Accounting, Auditing, and Bookkeeping Services
http://www.valuationresources.com/Reports/SIC8721AccountingAuditingandBookkeepingServices.htm
Accounting Services
http://industryprofiles.1stresearch.com/
Each industry profile includes industry overview, key questions, trends and
developments, threats and challenges, opportunities, news and media information,
financial information, and web site links. Sample report available; individual
industry profiles can be purchased online. Also available on subscription basis.
Bureau of Labor Statistics, U.S.
Department of Labor
Occupational Outlook Handbook - Accountants & Auditors
http://www.google.com/search?hl=en&q=occupational+outlook+handbook
This site describes the nature of the industry, working conditions, employment,
occupations in the industry, training and advancement, earnings and benefits,
employment outlook, and lists of organizations that can provide additional
information. Available free online.
Industry Growth Outlook Report
http://www.integrainformation.com
Report provides 5 years of historical and forecast industry revenue growth
information. Also includes historical and forecast macroeconomic indicators.
Covers
over 900 SIC codes. Individual reports can be purchased online.
Marketing
Research Profile
http://www.bizminer.com/index.asp?aid=78
Profiles provide market research by industry segment on a national
and local level for 250 metropolitan areas. Includes market
volume and number of firms, sales trends, sales per employee,
staffing and employment trends, startup activity, failures rates,
and new branch development. Available for all SIC codes.
Individual reports can be purchased online.
More Information
Other resources which cover a wide variety of industries are
available at
http://valuationresources.com/IndustryOutlook.htm.
Note: I think an
academic career is one of the best possible career choices.
However, be cautious
before embarking on such a career.
Something to consider before you embark
on a career in academe
Don’t get me wrong; I’m not trying to talk
you out of it – just making sure you know what you want. You
wouldn’t just forge ahead after graduate school by naively entering
the job market, applying for any and all posted positions, and
requesting a multitude of recommendation letters, without performing
some type of self-assessment – right? Unfortunately, academics
answer Yes more often than might be expected. In many cases, they
leap toward academic careers, ignoring somewhat painfully obvious
advice and warning signs — that they are not suited for this path,
or the goal of teaching or research is wrong for them. Why does this
happen? There is an unspoken pressure or obligation to seek
employment in academia after graduate training. That is what you are
supposed to do, and if you don’t, it’s an embarrassment and you’re a
disappointment.
David B. Rivers, "Who Are You?"
Inside Higher Ed, July 27,
2005 ---
http://www.insidehighered.com/careers/2005/07/27/rivers
-
-
-
Yahoo Search for CPA firms
When searching for a vendor, I recommend that you go to the
http://www.realnames.com web site:
If you know a product name and want to find what company makes that
product or vice versa, you might triy
http://www.realnames.com
. Web site URLs are also provided. I typed in "Authorware" and was
taken directly to the Authorware product section at the Macromedia web site.
From the Scout Report --- Business.com
http://www.business.com/
The owners of this lucrative URL address
have sponsored a Web directory created by a "team of 50
research analysts [that] has sifted through the Web to find
relevant sites for our handcrafted Directory." All Websites
in this 30-category directory have been annotated. The
annotations, however, tend to be very terse and a bit vague. First
time users are encouraged to skim over the excellent site guide,
which gives a step-by-step manual for using the site as well as
in-depth explanations of the terminology and taxonomy.
Big Five Accounting Firms
-
Arthur Andersen
-
-
Arthur Andersen Home Page
-
Arthur Andersen KnowledgeSpace
Arthur
Andersen - History of Accounting
-
Andersen Consulting
-
Architext Querying
-
Andersen Consulting Careers - The
Multimedia Experience (Shockwave)
-
Coopers & Lybrand (Now PriceWaterhouse
Coopers)
- PriceWaterhouse Coopers Global at
http://www.pwcglobal.com/
Coopers and Lybrand, Navy and TQM - Fraud
or Mistake
-
Deloitte & Touche
-
-
Deloitte & Touche LLP - US Practice
-
Deloitte & Touche PeerScape Home Page
Deloitte & Touche Risk Management
& Control: Visual Assurance
-
Ernst & Young
-
-
Ernst & Young LLP - Welcome
-
Perspectives on
Business Innovation (Ernst & Yojng Webzine online Magazine)
-
Here's Ernie
-
Ernie. Your online business consultant
-
Ernst & Young
LLP - Download Library - SFAS 133 Financial Instruments Derivatives
-
Ernst & Young
LLP - Download Library - SEC Rules on Financial Instruments Derivatives
-
.
-
KPMG
-
-
KPMG International
KPMG PEAT MARWICK LLP CAMPUS HOME PAGE
-
KPMG US -- Information Risk Management
-
KPMG US - Financial
Services: Banking & Finance Publications
-
-
Price Waterhouse (Now PriceWaterhouse Coopers)
- PriceWaterhouse Coopers Global at
http://www.pwcglobal.com/
Business Executive's Accounting Network (PriceWaterhouse
Coopers)
- PW Resercher Guidelines are given at
http://instruction.bus.wisc.edu/jfuhrmann/pwr/PW%20Researcher%20Guidelines.html
-
-
Price Waterhouse Researcher Updates
-
Ernst & Young LLP Home Page
-
Price Waterhouse Home Education Network
-
1997 EMC Global
Roundtable (Price Waterhouse)
-
SAP R/3 Design Center [SAP] Price
Waterhouse
Coopers & Lybrand L.L.P. (US) - Home
Coopers and Lybrand, Navy and TQM - Fraud
or Mistake
-
Miscellaneous Accounting Firms
Arthur Naman, CPA
BAKER NEWMAN & NOYES
Earl Hall, CPA
Ernst & Young LLP
KPMG Peat Marwick - US
Murphy Green & Company, CPAs
-
- Accounting Professional Site
Links
The CPA Team
http://www.cpateam.com/
-
-
Yahoo Search for CPA firms
INPACT Americas, An international network
of independent accounting firms
Professional Accounting Firms in USA
-
BGSU's Directory of CPA & Consulting
Firms
-
ACCOUNTANT'S HOME PAGE (includes CPA firm
directory)
-
CPA Web Site Interactivity (Directory of
CPA firms)
-
Bowling Green Univ. Directory of CPA
& Consulting Firms
-
Welcome to
Accountant-Finder (Directory)
-
MACPA Online (Doctors, Lawyers, and
Accountants)
-
Tax and Accounting Sites Directory
-
AccountingNet is the
complete online resource for accounting professionals: Accounting
-
E. Barry Rice, Loyola College in Maryland
-
Wm. Dennis Huber's
Web Page
-
Accounting and Financial Information
-
Accounting Site Seeker
-
Kent Information Services, Inc.
-
MACPA Online
- The Umbrella Project (helpers for starting up a small business)
http://www.umbrellaproject.com/
American Express Small Business Exchange
(Small business consulting, accounting)
-
Spiceland's Course
Resources
We've always known that you can buy some professionals (lawyers, expert witnesses,
jockeys, senators, athletes, the Olympics Board, evangelists, accounting professors,
etc.), but how low can you get when you can buy your CPA auditor online at an auction. See
http://www.cpaauction.com
-
-
-
- Directory of Online Corporate Annual Reports
http://www.reportgallery.com/
Gerald Trite's great set of links
---
http://iago.stfx.ca/people/gtrites/Docs/bookmark.htm
-
Electronic Corporate Reporting Website:
Home Page
-
AICPA SPECIAL
COMMITTE ON FINANCIAL REPORTING
-
Index of
/localinf/debtguide/
-
Corporate Information
-
Microsoft Financial Forum (Annual
Reports)
-
The International Corporate Environmental
Reporting Site / Milieujaarverslagen
-
Index for ACCT 5341
(International Accounting Theories)
If you want to look up a company's annual report online, a
very good annual report directory is located at
http://www.reportgallery.com/content/glry_a.htm
.
- If you want to look
up a company's annual report online, a very good annual report directory
is located at
http://www.reportgallery.com/content/glry_a.htm
. Of course there are some good SEC links at
EDGAR
Database
at
http://www.sec.gov/edgarhp.htm
EDGARSCAN from
PriceWaterhouseCoopers at
http://www.pwcglobal.com/gx/eng/ins-sol/online-sol/edgarscan/
Free EDGAR at
http://www.freeedgar.com/
-
- Invisible Worlds ( http://www.invisible.net/ )
is building a XML based duplicate EDGAR database
Hoovers UK (Database of information about companies in the UK,
like the US version of EDGAR)
http://www.hoovers.co.uk/
Thanks to Chris Nolan I found a
pretty good free web site for company and
company-to-industry comparison ratios at
http://www.financialweb.com/ . Click on the
research tab in at that web site and enter a symbol like IBM.
Chris also recommended
http://www.stockpoint.com/ . Enter a symbol or
company name such as IBM. Get the Quote for that company. Then click on the
Company Profile button to see some ratios.
Another free web site that I recommend is
http://www.investorguide.com/cgi-bin/research.cgi
After searching on a particular company's symbol (try IBM), you will find a Market Guide
link.
Alternately, you can begin with Market Guide at
http://www.marketguide.com/mgi/snap/4741N.html
or http://Yahoo.marketguide.com .
Users should carefully examine the Market Guide Glossary at
http://yahoo.marketguide.com/mgi/HELP/glossary.html
. A possible exercise for students is to have them verify (for
selected companies and selected ratios) the Market Guide calculations.
My next recommendation is to go to
http://www.natcorp.com/framedirectory.html
. By entering a company's stock symbol, you can get all sorts of links, including that
company's profile and fundamentals links. The "Company Data" path at this web
site leads to http://www.natcorp.com/traded.html
ABC News has some quick and very limited company
information for free at
http://webapp.abcnews.com/profiles/abc_comp_profiles.asp
If you want to look up a company's annual report
online, a very good annual report directory is located at
http://www.reportgallery.com/content/glry_a.htm
. Of course there are some good SEC links at
EDGAR Database
EDGARSCAN from PriceWaterhouseCoopers
(quicker response time)
Free EDGAR
For a fee, you can get more complete company and industry profiles
at http://www.wsrn.com . This is a very good service,
but some good things in life are not free.
If you are interested in online financial analysis, I highly
recommend some of Larry Tomassini's great links.
Tomassini's CorpOnline at
http://www.cob.ohio-state.edu/~tomassin/corps/corp.html
Tomassini's Financial Analysis Online
http://www.cob.ohio-state.edu/~tomassin/fanon.html
Jim Borden mentioned the Deloitte & Touche web site at
http://www.peerscape.com/member/index.cfm
I found the above server to be painfully slow. However, Jim's recommendations should
always be taken seriously.
MACRO ECONOMICS LINKS (including data classified by industry)
Last year I shared a platform with David Boldt at an education
technology conference at Bentley College. David has a great web site for economists,
particularly in the area of macroeconomics. His materials are listed at
http://www.westga.edu/~dboldt
If you are looking for industry and economic statistics. one place
to begin searching is at
http://econwpa.wustl.edu/EconFAQ/USMacro/index.html
The above web site leads to a heap of macro data, but you were more
interested in industry ratios. A bit of searching from the above site led me to a
University of Michigan site at
http://www.lib.umich.edu/libhome/Documents.center/stats.html
Facts and statistics (Fast Facts) ---
http://gwu.edu/~gprice/handbook.htm
Country Briefings (international statistics) from The
Economist http://www.economist.com/countries/
Stock Market Lab [.pdf]
http://www.yardeni.com/stocklab.html
- There are various industry categories at the above web
site. The Business and Industry button led me to the FedStats web site at
http://www.fedstats.gov
Another
good set of Federal Government links can be found at
http://www.sec.gov/others.htm
Advertisement Free
Personal Finance Blogs ---
http://pfblogs.org/blog/29
Links to the Top Five Personal Finance Web Sites:
http://www.tiac.net/users/nhannon/finance_personal.htm
Also see the CFO Magazine Online
http://www.cfonet.com/
An interesting personal finance web site (among the
thousands available) is at
http://www.cncurrency.com
Not much in the way of ratio data at that web site, but you will find a variety of
interesting documents and links.
-
I would appreciate readers to inform me about
accounting, auditing, tax, and related glossaries that are online. Some that I know about
are as follows:
Bob Jensen's Technology Glossaries
http://faculty.trinity.edu/rjensen/245gloss.htm
This web site contains a long listing of accounting and related
glossaries along with my
technology and education technology glossary
-
Fee-Based Accounting Knowledge Vortals for Most Developed
Nations and International Standards
Arthur
Andersen's Accounting Research Manager (after a free 30-day
trial, the cost is over $2,000 per year for a single user) ---
http://www.arm.arthurandersen.com Academic pricing is not mentioned at the Web site, but some
universities might possibly negotiate lower pricing.
Accounting
Research ManagerTM is a comprehensive financial reporting
knowledgebase that provides materials designed to help solve
your most pressings issues. Continually updated, it is the
most timely, complete, interpretive resource for your
financial reporting needs.
PwC's Comperio
Accounting Research Manager ($1,400 in the U.S. and considerably
cheaper in other nations, but the comprehensive version covering
all territories is $3,340)
Comperio
is the most comprehensive on-line library of financial
reporting and assurance literature in the world. Over 1,500
financial executives from around the world use Comperio on a
daily basis. Comperio content includes AICPA, DIG, EITF, FASB,
IAS, ISB and the SEC as well as pronouncements and standards
from Australia, Belgium, Canada, New Zealand and the United
Kingdom.
With
Comperio, the answers you need are always available - right
now, right at your fingertips. There is no software to install
- just go to the Comperio website and start researching!
The
entire online library can be immediately accessed by browsing
a pronouncement or topic directly, or by searching the entire
database for key words, topics or terms.
Visit
the Comperio product information site at
http://www.pwcglobal.com/comperio
. You will find the necessary forms to order Comperio today or
to request a 30-day free trial.
|
-
In
March 2000, Forbes named AccountantsWorld.com as the Best
Website on the Web ---
http://accountantsworld.com/.
Some top accountancy links ---
http://accountantsworld.com/category.asp?id=Accounting
Bob Jensen's
New Bookmarks ---
http://faculty.trinity.edu/rjensen/bookurl.htm
Bob Jensen's
Updates on Accounting and Finance Fraud ---
http://faculty.trinity.edu/rjensen/FraudUpdates.htm
Bob Jensen's main document on accounting fraud ---
http://faculty.trinity.edu/rjensen/fraud.htm
e-Commerce and e-Business Helpers for Accountants ---
http://faculty.trinity.edu/rjensen/ecommerce.htm
Finance
Newsletter --- The Finance Professor ---
http://www.financeprofessor.com/about/aboutFP.html
This is a reminder to
check the abstracting database, and article services that your
university's library pays for as a service to students, faculty,
and staff. If you've
not checked lately, you might be amazed at the expensive
subscription services that are available free online to you if
your library recognizes your password.
Chamber of Commerce Guide to Scholarships From Various Sources ---
https://www.chamberofcommerce.org/best-college-scholarships
For example, Trinity
University is a very small school, but the subscription services
of its library are rather extensive ---
http://lib.trinity.edu/dbs/
Theory Meets Practice ---
http://faculty.trinity.edu/rjensen//theory/00overview/theory01.htm#AcademicsVersusProfession
Bob Jensen
-----Original
Message-----
From: Paul Apodaca
[mailto:paul@PAPODACA.COM]
Sent: Wednesday, May 28, 2003 6:52 PM
To:
AECM@LISTSERV.LOYOLA.EDU
Subject: Re: Bad News from the New York Times
Neal,
A
possibility might be
http://www.rsicopyright.com/
.
They allow keywork tracking of 300 sources using their
"clip©" service. This is free, but only
provides an abstract of the article. If you want the actual
article, there is a charge to get it through them. I have it set
up for daily reports on "xml or xbrl" and "PCAOB",
but you can set your own frequency.
In
addition, you can access articles at:
1)
http://www.accountantsworld.com/
. I use them to host my website (http://www.papodaca.com) and
find the articles are quite useful. I point my students to my
website and have them check the "Daily News", but you
can access the same information directly. Access to the articles
is generally free.
2)
http://www.accountingweb.com/
Articles often duplicate the ones on AccountantsWorld, but that
isn't a surprise as they both use search bots to pull relevant
articles.
3)
http://www.smartpros.com
Another good source.
4)
http://www.dushkin.com/powerweb/
PowerWeb is free with many textbooks. PowerWeb has a
"Dynamic Accounting Profession" section as well. Very
good. The card that comes with the text gives you a code to
register (for that text), but so far, all of the accounting
items that I have accessed have not required me to register.
Registration also gives you access to the Northern Light premium
sources. Lots of good tips for the students as well.
I put
these links in my syllabi, and require the students to bring in
an article sometime during the semester. The only requirement is
that it have some vague connection to the course (and some of
them are VERY vague), and they give the class a brief verbal
abstract. It is part of their participation.
Not
terribly successful, but it is working better each semester.
I hope
that this information is useful.
From CPA Update News on
October 30, 2002
2. C P A n e t F i n d
s
Every so often you come
across a site or article that makes you stop and take notice...
Portfolio Management
Journal of Portfolio
Management -
http://www.cpanet.com/up/s0210.asp?ID=0606
Portfolio Management
Forum -
http://www.cpanet.com/up/s0210.asp?ID=0607
Portfolio Knowledge -
http://www.cpanet.com/up/s0210.asp?ID=0608
The Small-Cap Alpha
Myth -
http://www.cpanet.com/up/s0210.asp?ID=0609
Multistyle Rotation
Strategies -
http://www.cpanet.com/up/s0210.asp?ID=0610
myCFO -
http://www.cpanet.com/up/s0210.asp?ID=0611
Legal Research
Portals
Law & Legal
Research Center -
http://www.cpanet.com/up/s0210.asp?ID=0575
FindLaw -
http://www.cpanet.com/up/s0210.asp?ID=0576
AllLaw -
http://www.cpanet.com/up/s0210.asp?ID=0577
FindForms -
http://www.cpanet.com/up/s0210.asp?ID=0578
LawInfo -
http://www.cpanet.com/up/s0210.asp?ID=0579
LawyerExpress -
http://www.cpanet.com/up/s0210.asp?ID=0580
Technology for
Nonprofits
Nonprofit Technology
Planning -
http://www.cpanet.com/up/s0210.asp?ID=0581
Technology Funding -
http://www.cpanet.com/up/s0210.asp?ID=0582
The CTC Movement -
http://www.cpanet.com/up/s0210.asp?ID=0583
Hiring Consultants -
http://www.cpanet.com/up/s0210.asp?ID=0584
Computer Networks -
http://www.cpanet.com/up/s0210.asp?ID=0585
Recycled Hardware -
http://www.cpanet.com/up/s0210.asp?ID=0586
Web Building -
http://www.cpanet.com/up/s0210.asp?ID=0587
Database Management -
http://www.cpanet.com/up/s0210.asp?ID=0588
Project Finance
HBS Project Finance
Portal -
http://www.cpanet.com/up/s0210.asp?ID=0589
Project Finance
InfoSite -
http://www.cpanet.com/up/s0210.asp?ID=0590
Project Finance
Glossary -
http://www.cpanet.com/up/s0210.asp?ID=0591
Int'l Project Finance
Assn -
http://www.cpanet.com/up/s0210.asp?ID=0592
Project Development
Disciplines -
http://www.cpanet.com/up/s0210.asp?ID=0593
Project Finance
Magazine -
http://www.cpanet.com/up/s0210.asp?ID=0594
Enron Affect on Project
Finance -
http://www.cpanet.com/up/s0210.asp?ID=0595
College Funding
& 529 Plans
529 Plan Center -
http://www.cpanet.com/up/s0210.asp?ID=0596
IRS Code 529 -
http://www.cpanet.com/up/s0210.asp?ID=0597
529 Plans -
http://www.cpanet.com/up/s0210.asp?ID=0598
"529 college savings plans have their downsides The
state-sponsored programs offer a tax-advantaged way to save for
college. But there are pitfalls to 529s that even careful
investors can overlook," by Walter Hamilton and Stuart
Pfeifer, Los Angeles Times, December 18, 2011 ---
http://www.latimes.com/business/la-fi-college-529-20111218,0,2693621.story
Sherri and Cliff Nitschke thought
they were planning wisely for their children's college
educations when they opened a 529 savings account in 1998.
The Fresno couple saved diligently over the years in hopes
of avoiding costly student loans. But their timing couldn't
have been worse.
When they needed the money a decade later, their 529 account
had plunged in value during the global financial crisis.
Their portfolio sank 30% in 2008, forcing the Nitschkes to
borrow heavily to send their two sons to
UCLA.
"529s were no friend to us," Cliff Nitschke said. "Honestly,
it's probably one of the worst things we did. I could have
made more money putting it in a mayonnaise jar and burying
it in the backyard."
Over the last decade, 529 savings plans have surged in
popularity as parents scramble to keep up with rapidly
escalating college costs.
Similar in some ways to 401(k) retirement plans, 529s are
state-sponsored programs offering a tax-advantaged way to
save for college. Parents typically invest in stock and bond
mutual funds with after-tax dollars. But the earnings grow
free of federal, and generally state, taxes.
Every state offers at least one 529 plan, and parents can
invest in any state's plan. Many states give up-front tax
deductions for 529 contributions, though California does
not.
Assets in 529 accounts have swelled to $135 billion today
from $91 billion five years ago, according to Financial
Research Corp.
But as the Nitschkes discovered, there are downsides to 529s
that even careful investors can overlook.
"There are a number of pitfalls that can catch parents
completely off guard," said Deborah
Fox,
founder of Fox College Funding in San Diego, which advises
families on how to pay for college. "They are not a
panacea."
Bob Jensen's personal finance helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Maximize College
Funding -
http://www.cpanet.com/up/s0210.asp?ID=0599
Savings Plans Come of
Age -
http://www.cpanet.com/up/s0210.asp?ID=0600
Upromise -
http://www.cpanet.com/up/s0210.asp?ID=0601
SavingforCollege.com -
http://www.cpanet.com/up/s0210.asp?ID=0602
Paying for college -
http://www.cpanet.com/up/s0210.asp?ID=0603
529 Plans Explained -
http://www.cpanet.com/up/s0210.asp?ID=0604
Financial Aid: 529
Plans -
http://www.cpanet.com/up/s0210.asp?ID=0605
Time To Swap (College Education) Piggybanks? Custodial accounts have lost
much of their tax benefits
For years, parents have been stashing money in
custodial accounts to fund their kids' college educations. They've saved on
taxes, too, since a large portion of the bill is paid at the child's lower rate.
But recent changes in the law sap so much of the tax savings from custodial
accounts that state-sponsored 529 college savings plans, which are tax-free if
used for education, are better deals. In fact, they're so much better that you
may want to cash out your kids' custodial accounts and put the money in 529s.
Business Week, August 6, 2007 ---
Click Here
Advantages and disadvantages are concisely summarized at
http://en.wikipedia.org/wiki/529_plan
How 529 Plans Work ---
http://money.howstuffworks.com/5292.htm
Great Links
For more links about 529 plans, enter "529" into the search box at
http://www.howstuffworks.com/
Scroll over the links to brokerage firms to see a set of great free links.
- Also see
http://www.electronicaccountant.com/
-
- Where can you find a great listing of accounting
journals? Try http://www.csu.edu.au/anet/research/index.html
- Accounting Professional Site
Links
The CPA Team http://www.cpateam.com/
-
- CPA net --- http://www.cpanet.com/
Accounting Education Using
Computers and Multimedia (the AECM ListServ)
- CPA ListServ
AICPA Journal of Accountancy
Accountancy Magazine - Int'l Home Page
Association
of Government Accountants
Falkner and Gray's
ElectronicAccountant
A Forum for Accountants (Click on
Forums)
- CPAS-L, THE Internet Accounting
List/Forum for CPAs
- Perspectives on
Business Innovation (Ernst & Yojng Webzine online Magazine)
- The Electronic Accountant
- AcctgInfoPlus
Accounting Education Links
- AINTSYS-L: Journal
of Financial Information Systems
- CPA Journal Online
The Accountant's Ledger - The Online Magazine for Accountants
- IRS - The Digital
Daily
- The Accountant's Ledger - The Online
Magazine for Accountants
- Journal of
Accounting and Computers
- Journal of Financial
Information Systems
- Journal of Financial
Information Systems
- Newsand Information (Legislation, Law, Accounting,
Auditing, Health)
- The CPA Journal
- Cover story: Return
On Investment (Information Technololgy)
- Horizon Perspectives - CPA News
- WELCOME TO THE CPA VISION PROJECT!
- Featured Applied
Ethics Web Site
http://www.accountingstudents.com/news/headlines/index.html
Internet Essentials 99
Newsletter for the financial professional
Bob,
I have not yet updated my page on Double Entries so the information that you gave to AECM
on how to subscribe is incorrect. A Web-based registration form for Double Entries is at http://www.accountingeducation.com/subscribe.cfm
The form makes it very easy for any user to sign up for Double Entries (Mark 2).
Cheers,
RogerD
TO SUBSCRIBE to the ANet: (I highly
recommend this for accountants and accounting educators)
1. send an email message to: listname-request@listserv.csu.edu.au
Substitute for "listname" the name of the particular list to which you wish to
subscribe. Dont forget the word "request". For example, to subscribe to
ANEWS address your message to ANEWS-L-request@listserv.csu.edu.au
2. In the SUBJECT line type: subscribe
Make sure this is in the subject line and not in the body of the message!! Note that
complete archives of the lists are held at http://www.csu.edu.au/anet/lists/
- For the most comprehensive web site containing news about accounting, investing, and
accounting education, I recommend that you take at least weekly visits to
AccountingEducation.com
http://www.accountingeducation.com/
(also note the comprehensive set of links).
August 2001 CPA
Journal's Chosen "Website of the Month"
Website
of the Month: My Accounting Portal My Accounting Portal ( www.myaccountingportal.com
) launched only in January, but its act seems to have been in good
shape from the get-go. Touting itself as combining “the best
features of consumer portals by giants such as Yahoo and Excite
with the reference tools and resources of a traditional accounting
website” and including “extensive customization technology, a
wealth of original content, powerful tools, and carefully screened
links,” the “about us” page does not overstate the case.
This
portal probably meets the criteria on anyone’s bookmark
checklist. Features include the following:
Customization.
Similar to general-user portals like Yahoo, a user can customize
the main page so favorite news feeds, research materials, and
other resources are readily available.
A user
can recustomize the layout at will.
Personal/professional
features. The portal has an accounting website module that
provides a range of accounting news and research and access to
web-hosted applications. The portal also offers general and
business news, links to websites in myriad areas, a personal
information manager, stock quotes, weather, and other modules.
Editors’ top picks. The portal’s editors select articles from
listed websites they think will be most helpful to accountants and
organize them into convenient categories. Personal information
manager (PIM) and QuickMail. These areas contain the familiar
contacts, notes, calendar, task list, bookmarks, and e-mail
functions, available through a web-based interface for easy
accessibility. Office tools. The portal’s tools for doing
business on the Internet include basic telephone directories as
well as collaboration tools for storing data and sharing
information electronically. Client interactivity. The portal is
developing a number of client-interactive features, such as
web-hosted applications, downloadable tax-returns, a tax due-date
calendar, a client scheduler, and time and billing functions. For
accountants that already have office management and PIM tools, My
Accounting Portal may offer more than needed. But the
anywhere-anytime advantage is a real one, the online research
archives are impressive, and the portal’s website listings are
well organized.
Accounting Directories
http://accountantsworld.com/category.asp?id=Accounting
AccountingWEB's Entrepreneur to Accountant Referral Network (E.A.R.N.)
program, matching the accounting and financial needs of thousands of small
businesses with the talent of the AccountingWEB community. http://www.accountingweb.com/item/39161
- Jack Anderson's Accounting Information Finder --- http://www.umsl.edu/~anderson/accsites.htm
Accounting & Tax News
Accounting Web
Accounting
Education (Strong on International Accounting News)
- ANet web site at http://www.csu.edu.au/anet/
IAS Plus (Strong on
International Accounting News and Standards)
Electronic
Accountant
Accountant's
World
PPCnet
Accounting
Today
AICPA
VAT
CCH
Tax
News
Tax Cast
Tax
Wire
A top web site for international accounting
news and resources is the ANet web site at http://www.csu.edu.au/anet/
Don't neglect the Prentice-Hall Phlip
web site maintained superbly by David Fordham at James Madison University.
(David does a good job with this.)
http://www.phlip2.marist.edu/phinternet97/accounti.htm
AccounitngNet also carries updated news in a Newsletter at http://www.accountingnet.com/newsletter
.
Dryden Press has useful accounting educator news at
links at
http://www.dryden.com/infosys/parker3/student/resources/
And don't forget the Accounting Students Newsletter at http://www.accountingstudents.com/ .
This web site is particularly helpful in providing career helpers to students.
-
Wow International Accounting Helper
Site
Paul is a former student during my years at Michigan State
University and has been project director of various FASB and IASC
accounting standards before joining Deloitte on special assignment
in Hong Kong.
Hello Bob,
As part of my
work at Deloitte here in Hong Kong, I have developed IASPLUS,
which is both a web site (http://www.iasplus.com)
and a quarterly printed newsletter (the latter is available on the
website in electronic form). The website and newsletter are
devoted to the development, dissemination, understanding, and use
of International Accounting Standards. Both include
country-specific information -- currently limited to Asia but soon
to be expanded to include Europe and beyond.
I thought these
might be of interest for your bookmarks.
I enjoyed our
panel together at the AAA. I hope to see you this summer at
the Atlanta meeting.
Paul Pacter
Reply from John Phillips [jphillip@UOG9.UOG.EDU]
on March 7
This is a great site it provides details
not only on IAS but on the countries of the world as to their
accounting standards and CPA organizations
-
- Accounting
Journals Index
Accounting Education Using Computers and
Multimedia
Association of
Government Accountants
-
CPA ListServ
Business Executive's Accounting Network (PriceWaterhouse
Coopers)
A Forum for Accountants (Click on
Forums)
Bob Jensen's Links
Scout Report Acrobat .pdf Versions
- Falkner and Gray's
ElectronicAccountant
- Scout Report Homepage
- AcctgInfoPlus
Accounting Education Links
- Home - CPA Newsletter (From Dave Albrecht
)
- WSRN.com: Research A
Company (Accounting Education, Financial News, Financial Markets)
- Double Entries - CAARNet (Accounting
Newsletter)
- AccountingStudents.com
- Featured Applied
Ethics Web Site
- Kent State CPA Newsletter
- BUSINESS RESOURCES
- Welcome to NACUBO!
- The International Corporate Environmental
Reporting Site / Milieujaarverslagen
Internet Scout Project - Home
http://www.accountingstudents.com/news/headlines/index.html
Just for Educators from the AICPA --- http://www.aicpa.org/edu/justedu.htm
Not-For-Profit (NPO)
Links
Links to Not-For-Profit (NPO) Sites, Journal
of Accountancy, November 2000, p. 19 --- http://www.aicpa.org/pubs/jofa/nov2000/news_web.htm
The Law of the
Not-for-Profit Land --- www.icnl.org
The
mission of the International Center for Not-for-Profit Law is to
assist in "the creation and improvement of laws and
regulatory systems that permit, encourage, and regulate the NPO
sector in countries around the world." The site contains an
online library of legal opinions and self-regulation and tax
documents.
A Path to Information --- www.indepsec.org
The Independent Sector's
home page is also the home of both the Nonprofit Information
Center and the Nonprofit Pathfinder. The center explains what
constitutes the not-for-profit sector, its size and scope,
volunteering and links to related resources. The pathfinder bills
itself as "the global gateway to civil society research and
innovation" and includes links to resources such as academic
centers and other NPOs.
Your Questions Answered ---
www.nonprofits.org
The
Internet Nonprofit Center offers news items as well as a free
weekly e-mail subscription to its online newsletter. But the most
useful aspect of this site is its frequently-asked-questions
section, which covers a number of topics, including accounting,
audits, compensation, risk management and software.
News for NPOs --- www.gilbert.org/news
The
Nonprofit Online News site, like the one above, offers news items
and a free weekly e-mail subscription to its online newsletter.
Also available are newsletter issues from April 1997 through the
present, as well as a section where NPOs can submit their own news
items.
The Source for Management
--- www.nptimes.com
The
NonProfit Times bills itself as "the leading business
publication for nonprofit management." It includes an
employment marketplace section and a resource directory. The
magazine is offered free to full-time U.S. NPO executives
"whose organizations qualify." Two other editions of
their publication—for direct marketing and for financial
management—are available.
"Sizing Up NPO
Software," Roberta Ann Jones, Journal of Accountancy,
November 2000, pp. 28-44 --- http://www.aicpa.org/pubs/jofa/nov2000/jones.htm
- TRYING
TO ADAPT
conventional accounting software to handle the books of an NPO
is like struggling to fit a square peg in a round hole. Their
differences are so significant that without major customizing,
for-profit software just can’t handle NPOs’ unique
accounting needs.
- NPO
ACCOUNTING SOFTWARE
should be able to accommodate, among other things, multiple
self-balancing funds, encumbrance accounting and special reports
to meet FASB and/or GASB requirements.
- WHEN
YOU EXAMINE products,
you’ll probably find that you’ll have to make some
trade-offs when it comes to software functions.
- EACH
PACKAGE HAS GOOD
and bad features. But in some cases, features this review gave
low marks to may not be critical to the way you use the
software. Features that were highly rated may not be important
to you. Your needs should dictate which product is right for
you.
- WHATEVER
YOU DO,
before buying, run comprehensive evaluations. It is not good
enough to trust the claims of a vendor. Test the product with
data typical for your organization.
ABA LawInfo.org --- http://www.abalawinfo.org/
Your gateway to information on legal
topics that affect your daily life.
-
Richard
Torian's Managerial Accounting Information Center --- http://www.informationforaccountants.com/
O'Keefe Accounting Library Searches
http://library.sau.edu/bestinfo/Majors/Accnt/accindex.htm
-
What Is
Activity-Based Costing?
- Activity Based Costing
Some links from Stephen H. Glad (links to
accounting, auditing, finance, and government sites)
- CONSORTIUM FOR ADVANCED MANUFACTURING
(Activities Based Costing)
Worldwide Directory of Accountants and Consultants ---
http://www.searchsystems.net/list.php?nid=62
Bob Jensen's helpers on how choosing professional advice ---
http://faculty.trinity.edu/rjensen/fees.htm
Accounting Professional Site Links
The CPA Team http://www.cpateam.com/
When accounting for advertising firms, Susan Jeter recommended Adman
from Marketing Resources Plus
http://www.lib.polyu.edu.hk/electdb/DATAPRO/154-1.htm#prod30
A great listing of URLs of companies selling
accounting systems software.
http://www.lib.polyu.edu.hk/electdb/DATAPRO/154-1.htm
- E. Barry Rice, Loyola College in Maryland
- A S A P
- Electronic Corporate
Reporting Website: Home Page
- ABREMA - Activity
Based Risk Evaluation Model of Auditing
- ACCOUNTING RESOURCES
ON INTERNET
- AICPA SPECIAL
COMMITTE ON FINANCIAL REPORTING
-
AuditNet: Internet Resources for Auditors
- G A R P
- AuditNet ---
http://www.auditnet.org/
- Internal Auditing
- FreeEDGAR.com: Free live EDGAR data and
more...
accounting history
Welcome to CROL (online annual financial
reports)
- Yahoo! - Business
and Economy:Companies:Financial Services:Accounting
- Home Page for MicroMash
- Featured Applied
Ethics Web Site
- Accounting Education Using
Computers and Multimedia
CPA ListServ
A Forum for Accountants (Click on
Forums)
Vitual Relocation helpers from James Angelini, CPA. Among other
things you can find cost of living comparisons at http://www.virtualrelocation.com/
Compensation
and Financial Planning Sites
From the Journal of Accountancy, October 2001, Page 23 --- http://www.aicpa.org/pubs/jofa/oct2001/news_web.htm
Plan
for Tomorrow Today
www.adp401k.com
This
retirement services site offers detailed explanations of various
plans—defined contributions, 401(k) safe harbors, SIMPLE IRAs and
executive deferred compensation. It also provides users with overviews
and information about the requirements for and contributions to such
plans.
A
Web-Based Watchdog
www.aflcio.org/paywatch/index.htm
Although a
company’s stockholders might not see much of a profit for a given
fiscal year, top executives still could receive millions of dollars in
salary, bonuses, and stock options. This section of the AFL-CIO site
tracks compensation packages for CEOs of corporations in the Standard
& Poor’s 1,500 stock index.
A
Beneficial Introduction
www.rsgroup.com/html/r_retpln.htm
This section
of the Retirement System Group’s site briefly reviews the benefits
of various retirement plans, such as IRAs and defined benefit,
contribution and nonqualified plans.
Pension
Plan Tools
www.psca.org
Magazines,
newsletters, research, statistics and survey information, as well as a
glossary of terms, are available at the Profit Sharing and 401(k)
Advocate site. Frequently asked questions about benefit plans, as well
as historical data on the growth of 401(k) eligibility and defined
contribution plan participation and assets from the late 1970s to
1999, are also included.
Archived
Articles and Alerts
www.rbvdnr.com/eb/articles.htm
The law firm
Reinhart, Boerner, Van Deuren, Norris and Rieselbach offers users
information on various topics at this site. It features articles such
as “FDIC Regulation Alert—Restrictions on Golden Parachutes and
Indemnification Agreements” and “How ‘GATT’ Affects Your
Retirement Plans.” The Employee Benefits section features an alert
comparing the Treasury’s 2001 and 2000 limits for various types of
benefit plans.
- U.S. Securities & Exchange Commission
The SEC's Ten Questions
to Ask About Any Investment Opportunity
EDGAR Database
EDGARSCAN from PriceWaterhouseCoopers
Free EDGAR
Guides from the SEC about calculating the cost of a mutual fund
http://www.sec.gov/mfcc/mfcc-int.htm
-
from the Scout Report on May 17,
2001
FundAlarm http://www.fundalarm.com/
While most mutual fund information
Websites will tell you when you should buy mutual funds,
FundAlarm, created and maintained by Roy Weitz, CPA, offers news
and information that will help users make informed decisions
about selling their mutual finds. Along with a database of
nearly 4,000 data tables of stocks and balanced mutual finds,
FundAlarm also provides three lists of mutual funds: those that
should be sold right away, those to keep, and mutual funds that
are merely strong candidates for
-
How to Download IRS Forms from the IRS ---
https://www.irs.gov/pub/irs-pdf/?C=M;O=D
2019 Tax Software Survey ---
https://www.journalofaccountancy.com/issues/2019/sep/2019-tax-software-survey.html?utm_source=mnl:cpald&utm_medium=email&utm_campaign=12Sep2019
How CPA's Rate Their Tax Software in 2017 ---
http://www.thetaxadviser.com/issues/2017/aug/2017-tax-software-survey.html?utm_source=mnl:cpald&utm_medium=email&utm_campaign=01Aug2017
. . .
Of more than 3,500 responses to this year's survey,
seven major tax software products accounted for about 92% of users,
with three products having the highest percentages of users:
UltraTax CS, ProSystem fx, and Lacerte. Users of Drake software gave
it the highest overall rating and ranked it highly in several
performance categories, although they rated it below average for
integration with other accounting software and ease of importing
data. In general, CCH Axcess Tax and ProSystem fx predominated among
the largest practices represented, while Drake and ATX were most
often used by sole practitioners and small practices.
A sharply lower percentage of respondents than a year
earlier reported having clients whose identities had been stolen by
thieves filing fraudulent refund claims. In the 2016 survey, nearly
59% of respondents had encountered tax ID theft in the preceding tax
season; this year, that percentage was 43%. Moreover, those CPAs who
did see ID theft this year said it affected a smaller percentage of
their clients, and they reported lower levels of difficulty in
resolving the problem with the IRS.
As in past years, price posed the sharpest divide
among products in terms of most- and least-liked aspects. Price was
most often picked as the best-liked feature of ATX and Drake, while
it was most often the least-liked feature of UltraTax CS, Lacerte,
ProSystem fx, CCH Axcess Tax, and ProSeries.
Continued in article
Bob Jensen's tax helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
The Tax Advisor is Free on
the Web
http://www.thetaxadviser.com/
Thank you Scott Bonacker for the heads up.
Warning: Although tax reform is unlikely over the next four
years, miracles do happen. Some of the strategies suggested in the
links below may be less advisable under serious revisions of our
nation's tax law. Always stay up to date on tax reform. Even
if there are no broad reforms, selected reforms are possible. For
example, the advantage of not realizing long-term capital gains
until after you die might be revised even if there are no other
remarkable changes in the tax code.
The really-needed revision of the tax code for capital gains is
to adjust these gains for inflation. Doing so, however, doesn't have
a snowball's chance in Hell.
When I forward tax advice links like the one below it does not
mean that I agree with every piece of the advice or that I hold
myself out as being a tax expert. Although I taught accounting for
40 years, I never taught tax accounting. I rely on tax software like
Turbo Tax as much or more than you rely on such software.
If you really need help with your taxes, first visit the truly
great IRS Website at www.irs.gov
If that does not do the job seek out a genuine tax expert for
advice. Remember that all people who charge you for doing tax
returns are not necessarily experts on tax planning and strategy.
All tax experts are not equal any more than all physicians, lawyers, or
college professors are all equal.
"4 Tax Breaks Every College Student
Should Know About," by Mandi Woodruff, Business Insider, October 25,
2013 ---
http://www.businessinsider.com/college-student-tax-breaks-2013-10
Technical Tax Course Materials from
Lexis-Nexus
Graduate Tax Series ---
http://taxprof.typepad.com/files/graduate-tax-series-description-082911.pdf
Academic Versus Political Reporting of Research: Percentage Columns
Versus Per Capita Columns ---
http://www.cs.trinity.edu/~rjensen/temp/TaxAirlineSeatCase.htm
by Bob Jensen, April 3, 2013
From the IRS
Beware of Bogus IRS Emails ---
http://www.irs.gov/uac/Newsroom/Beware-of-Bogus-IRS-Emails
Bob Jensen's threads on fraud reporting ---
http://faculty.trinity.edu/rjensen/FraudReporting.htm
The Tax Policy Center has a good online tool for making
before-and-after estimations ---
http://calculator2.taxpolicycenter.org/index.cfm
The 8 biggest mistakes taxpayers make, from the accountants
who know best ---
http://www.businessinsider.com/the-8-biggest-mistakes-taxpayers-make-from-the-accountants-who-know-best-2016-4
The MileIQ Gadget from Microsoft Can Save
Thousands of Tax Dollars for a Business Traveler (or lead to
greater reimbursements from employers) ---
Try it for free ---
https://www.mileiq.com/
What tax software do the pros prefer in 2015?
"2015 tax software survey: CPAs rate the technical merits of one
of their most critical tools for surviving tax season," by Paul Bonner,
Journal of Accountancy, September 1, 2015
http://www.journalofaccountancy.com/issues/2015/sep/2015-tax-software-survey.html#sthash.Vp5a0Hyb.dpuf
Jensen Comment
I now despise TurboTax for two reasons.
Firstly, in 2015 TurboTax unethically removed some features from
the package I use every year and then belatedly made me pay $30
extra for those features. Public outrage made them refund $25 of
that extra fee, but there was all sorts of confusion and time wasted
on the part of us taxpayers using TurboTax.
Secondly, I think TurboTax handled its security data breach badly
in the aftermath of losing Social Security numbers and IRS Pin
numbers for those of us who filed electronically in 2014. They
should have been more helpful to customers that they harmed.
Two things have changed in my personal tax life.
One is that I will never buy TurboTax again (my way of protesting
the bad ethics of TurboTax). And secondly I will probably never file
electronically until the IRS finally figures out a way of not
letting ID thieves file tax returns using my name, my Social
Security Number, and my IRS Pin number. It's true that the IRS takes
the loss instead of me, but I had to be smart enough to figure out
that my ID was stolen from TurboTax and that somebody (probably in
Russia) filed a tax return in my name. It's a good thing I figured
it out and filed a second return using the U.S, Post Office.
TurboTax ---
http://en.wikipedia.org/wiki/TurboTax
TaxACT ---
http://en.wikipedia.org/wiki/TaxACT
In the past I used TaxACT until 2010 when Wal-Mart only had
TurboTax available. So I switched to TurboTax in 2010 and used it
until next year when I will go back to TaxACT. Note that TaxACT will
read all of your prior TurboTax returns and vice versa.
Here's why I will never ever use TurboTax again.
- On January 10. 2015 I went to Wal-Mart as usual to buy by
TurboTax Deluxe disk for $49. I prefer to own the disk to make
it easier in future years if I have a tax audit and a computer
crash. I have backup hard copy returns, the installation disk,
and backup copies of my returns on several hard drives.
- I January 24 when I installed TurboTax and the software
works fine as long as I do not try to install updates. The
updates corrupt the program both my main computers. So I decided
that this year I will simply not install updates.
- On January 24 things were going smoothly using TurboTax
Deluxe until I tried to install a small amount of bond sales for
2013. A message popped up from the CEO of TurboTax informing me
that his company did a bad thing this year to TurboTax Deduct.
If I wanted to file my tax return I would have to pay an added
$30 to his company. Then when I file my tax return using
TurboTax he will send me a $25. I
guess he's still trying to screw me out of $5 plus all the time
I lost sending an added $30 in extortion money to TurboTax.
He shoud be refunding me the $35 for the added time
and aggrevation.
- After I put out the refund information on a couple of
listservs I got a few horror stories about frustrations of
others with TurboTax in the past. The
most egregious frustration is that sometimes,
purportedly, TurboTax will tell you that your electronic return
has been accepted by the IRS when in fact it was not received by
the IRS. Horrors!
- Thus I'm shifting to TaxACT for good. So long TurboTax. This
is not the first year in which you screwed your customers.
The bait and switch (failed) strategies of Turbo Tax in 2013 and 2014
Explained
http://www.businessweek.com/articles/2015-01-23/the-cheapest-tax-prep-software-for-2015-hint-it-s-not-turbotax-?campaign_id=DN012315
"TurboTax Apologizes for Bait-and-Switch, Provides $25 Refunds to
Customers," by Paul Caron, TaxProf Blog, January 23, 2015 ---
http://taxprof.typepad.com/taxprof_blog/2015/01/turbotax-apologizes-for-bait-and-switch.html
"TurboTax Customers Angry Over Change In Tax Return Software," CBS
News via Paul Caron, TaxProf Blog, January 14, 2015 ---
http://taxprof.typepad.com/taxprof_blog/2015/01/turbotax-customers-angry-.html
Changes to the popular tax program, TurboTax, has some customers mad.
“People are just livid. They feel deceived,” says consumer advocate Edgar
Dworsky. “They feel they’ve used this product for so many years, they’ve
trusted it, and now they’re being sandbagged.” Dworsky is a TurboTax
customer unhappy after Intuit, the maker of TurboTax, changed the deluxe
version of the popular tax preparation software product.
The changes require customers to upgrade to more expensive versions if
reporting investment, self-employment, or rental income — costing an extra
$30 to $40 — and surprising many long-time Turbo customers. “Imagine their
surprise when they get halfway through doing their taxes and there is a
roadblock in the program that says you have to upgrade,” added Dworsky.
“It can be viewed as a bait and switch, yes,” Prof. Bryan Menk told KDKA
money editor Jon Delano on Tuesday, “because people were not accustomed to
this limitation in a prior year.” Menk teaches taxation at Duquesne
University and uses TurboTax himself.
Jensen Comment
Sounds to me like it's time for another boycott.
Note that H&R Block software can read your prior-year TurboTax
return and vice versa if you want to change software.
2008 TurboTax Boycott
Tax Software Boycott of TurboTax Begins: I'll Bet You Can't Find
the Hidden Fees Disclosed on the TurboTax Website
Note that this was back in the time when most taxpayers mailed
in hard copy printouts of their tax returns. It was common to by one
copy of TurboTax and then file returns for other members of the
family such as when a married couple filed separate returns.
Users are not complaining about the
functionality of TurboTax. The problem, as they see it, is with
pricing changes. For the first time, TurboTax producer Intuit
started charging users an additional
$9.95 for each additional return whether they print or e-file.
Also, readers complain that the 2008 software costs more at
checkout, jumping from $44.95 to $59.95. (However, when
AccountingWEB went on Amazon, the software could be had at the
discounted price of $54.99.) . . . One reviewer seemed to be issuing
a battle cry by writing, "Time to start the boycott." Another
reviewer had criticism of a more personal nature: "You should fire
the person who came up with pay to print!" Of the 182 product
reviews as of the evening of December 9, 2008, 171 of them were
one-star reviews and only five were five-stars, the highest rating.
Of the five five-star ratings, one user named Fernando Ortega said
TurboTax is still the best, pointing out that he doesn't have to
enter all of his personal information and previous returns manually.
"TurboTax turmoil: Online reviews pan the top selling software,"
AccountingWeb, December 2008
---
http://www.accountingweb.com/cgi-bin/item.cgi?id=106620
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Student Debt ---
https://en.wikipedia.org/wiki/Student_debt
Student Debt Forgiveness. like nearly all debt forgiveness, is
taxable income
"There's a big problem with the government's offer to 'forgive'
your mountain of student-loan debt," by Jonathan Garber and Andy
Kiersz, Business Insider, August 11, 2015 ---
http://www.businessinsider.com/problem-government-forgive-student-loan-debt-2015-8
. . .
The loan-forgiveness repayment plans
are helpful, but it's not that simple.
Two of the more popular ones are Public
Service Loan Forgiveness and Income-Based Repayment.
Public Service Loan Forgiveness allows
those working in the public sector to apply to have their loans
forgiven after 10 years of service, which equates to 120
payments.
For those who don't work in the public
sector, the government created a few
income-driven plans. These allow
borrowers to pay between 10% and 20% of their discretionary
income toward their student loans, which will then be forgiven
in 20 to 25 years.
However, there is one big problem. The
loan balance at the time of forgiveness is treated as income and
taxed as such. Depending on the interest rate of the loan (some
Federal loans have interest of more than 7%), the income-based
payments might not cover the interest that is accumulating on
the debt, which would cause the payoff amount of the loan to
snowball over those 25 years.
Also, if someone is making income-based
payments, chances are they are doing so because they cannot
afford to make their regular loan payments. If that's the case,
what makes the government think borrowers will be able to foot
the massive tax bill at the end of 20 or 25 years?
The government has a
handy loan-repayment calculator that
lets borrowers see what their payments will look like under
different repayment programs.
We made a hypothetical situation where
a new borrower took out $100,000 in direct subsidized loans at a
conservative 4% annual interest rate, has an annual income of
$45,000, is single, lives in New York, and has no children.
Under a standard repayment plan, our
hypothetical borrower would have monthly payments of $1,012 for
10 years. Under the Income-Based Repayment program for new
borrowers, our recent graduate would have much lower monthly
payments over 20 years, ranging from about $228 to $719, as her
income increases over time:
2016 States in the USA With the Highest and Lowest Tax Rates
---
https://wallethub.com/edu/best-worst-states-to-be-a-taxpayer/2416/
Overall, Illinois has the highest tax
rates, followed by Nebraska, Wisconsin, Connecticut, Rhode
Island, and New York, according to an analysis by WalletHub.
Notably, tax rates are about 10.56% higher in blue states than
in red states.
New York has the highest cigarette
excise tax at $4.35 per pack, while Missouri has the lowest at
$0.17. Pennsylvania has the highest gas tax at $0.5040 per
gallon, while Alaska has the lowest at $0.1225.
Jensen Comment
Some of those most taxing states were also subject to state-worker
pension frauds and enormous pension underfunding, notably Illinois,
Connecticut, and Rhode Island.
Note the far right column that provides an adjusted cost of
living index. California, Oregon, and Washington DC, for example, do
fairly well on tax rates but come out horribly on the adjusted cost
of living index. There are not many surprises on the high cost of
living where the worst states are New York, Connecticut, Hawaii,
Rhode Island, and New Jersey.
2015 as Reported by the Tax Foundation: The Ten Worst States for
Property Taxes ---
http://www.cheatsheet.com/business/the-10-worst-states-for-property-taxes.html/?a=viewall
- New Jersey
Taxes as percentage of home value: 1.89%
•Median home value: $348,300
•Rank based on percentage of income: 1
- New Hampshire
Taxes as percentage of home value: 1.86%
•Median home value: $249,700
•Rank based on percentage of income: 2
- Texas
Taxes as percentage of home value: 1.86%
•Median home value: $249,700
•Rank based on percentage of income: 2
- Wisconsin
Taxes as percentage of home value: 1.76%
•Median home value: $170,800
•Rank based on percentage of income: 8
- Nebraska
Taxes as percentage of home value: 1.70%
•Median home value: $123,300
•Rank based on percentage of income: 14
- Illinois
Taxes as percentage of home value:
1.73% •Median home value: $202,200
•Rank based on percentage of income: 5
- Connecticut
Taxes as percentage of home value: 1.63%
•Median home value: $291,200
•Rank based on percentage of income: 4
- Michigan
Taxes as percentage of home value: 1.62%
•Median home value: $132,200
•Rank based on percentage of income: 10
- Vermont
Taxes as percentage of home value: 1.62%
•Median home value: $132,200
•Rank based on percentage of income: 10
- North Dakota
Taxes as percentage of home value: 1.42%
•Median home value: $116,800
•Rank based on percentage of income:
Jensen Comment
This is partly an illustration of how to mislead with statistics,
because the property taxes are not comparable in all respects among
the 50 states. For example, all states do not have the same
homestead exemptions. And not all states have the same conditions.
The big exception is California that has Proposition 13 that is
fully applicable to California and partly applicable to some other
states in terms of property tax relief in setting limitations on tax
valuations of property ---
https://en.wikipedia.org/wiki/California_Proposition_13_(1978)
Some states provide relief to senior citizens that is partly an
attempt to keep them from leaving the state in retirement. For
example, in Texas senior citizens have a something like Proposition
13 for the school district portion of property tax bills but not the
same tax valuation freeze for other items in the property tax
billings.
Some states are react more quickly to changes in property tax
values. For example, when I owned a home in Bexar County, Texas the
property tax valuations were almost continuously updated. Now that I
live in New Hampshire it seems like changes in valuation are almost
rare events that lead to a lot of tax valuation unfairness. Two
homeowners living side by side with virtually identical homes may
have different tax valuations based upon how long they owned their
homes. For example, a home owner living in a home for 30 years may
have a much lower tax valuation than an owner who recently purchased
the home.
Probably the most misleading aspect of the above state
comparisons is the failure to also include other items of state
taxation that also clobber home owners such as state income taxes
and sales ttaxes. For example, home owners in most of the above
states also get clobbered with those other state taxes but not New
Hampshire and North Dakota. Texas has a wicked sales tax but not a
state income tax.
How to Mislead With Statistics
America's Best and Worst States for Taxes
(2019) ---
https://finance.townhall.com/columnists/danieljmitchell/2019/10/24/americas-best-and-worst-states-for-taxes-n2555297?utm_source=thdaily&utm_medium=email&utm_campaign=nl&bcid=b16c6f948f297f77432f990d4411617f
The combining of "taxes" can be misleading. For
example, compare the above ranking with the following ranking.
01 New Jersey
(highest taxes)
02 New York
03 California
04 Connecticut
05 Arkansas
06 Minnesota
07 Vermont
08 Maryland
09 Iowa
10 Louisiana
. . .
41 Indiana
42 Utah
43 Oregon
44 Nevada
45 New Hampshire
46 Montana
47 Florida
48 Alaska
49 South Dakota
50 Wyoming (lowest taxes)
Jensen Comment
There's no one state that's best or worst on all types of taxes. And even with
respect to one tax, the outcomes can be misleading. Take property taxes.
California is horrible for recent home buyers, but property taxes are relatively
low for long-time home owners because of Proposition 13 ---
https://en.wikipedia.org/wiki/1978_California_Proposition_13
And states that appear to be best in terms of all
taxes in the above ranking are among the worst for some types of
business taxes. And some taxes that are the highest taxation states
often make the best deals for attracting and keeping businesses with
tax breaks and subsidies --- Exhibit A is New York.;Exhibit B is New
Jersey; and Exhibit C is Illinois.
But the biggest problem lies in how multiple tax
burdens are aggregated across different taxpayers. Compare the ranks
above with the ranks below.
States with the highest, lowest state and local
tax collections ---
https://taxfoundation.org/state-local-tax-collections-per-capita-2019/?fbclid=IwAR3zpltt_AMIquAps_TtHDDUk482ovmEqO9sU1jUu3GQX32Ttp-g1p4Amrs
01 New York
(highest taxes)
02 Connecticut
03 New Jersey
04 North Dakota
05 Hawaii
06 Massachusetts
07 Minnesota
08 California
09 Maryland
10 Vermont
. . .
41 Missouri
42 Georgia
43 Mississippi
44 Arizona
45 Idaho
46 Florida
47 Oklahoma
48 South Carolina
49 Tennessee
50 Alabama (lowest taxes)
Jensen Comment
This is a classic case of ranking based upon averages that ignore sampling
distributions (particularly skewness), standard deviations, and outliers.
For example, Alabama supposedly offers the best tax deal, but not necessarily
if you make over $250,000 per year. Alabama has all types of taxes, including an
income tax. If you make over $250,000 per year you're probably better off in a
state without an income tax like Nevada or Florida. The problem is that Alabama
has a skewed distribution with lots of low income people who pay little or no
income tax. In comparison New York has a much higher proportion of very high
income people who pay lots and lots of income tax.
Wealthy people are fleeing high income tax states like New York and Vermont,
but not many are choosing to relocate in
Alabama because Alabama supposedly, according to the above article, offers the
best tax deal among all 50 states. That alone should tell you something is wrong
with the above ranking of states.
Taxation was a factor in my decision about where to retire, especially when
comparing high tax states like California, Wisconsin, Vermont, and Maine with
with relatively low taxing New Hampshire (that has no sales tax or income tax).
It's also hard to compare some types of taxes. California, for example, is
exceedingly difficult to evaluate in terms of property taxes without knowing the
context of the comparisons. If you've owned a big house in Palo Alto, California
for 40 years property taxes are not a killer because of Proposition 13 that
locks you into paying less than $25,000 per year. However, if you sell your
house the buyer may have to pay way over $250,000 per year in property taxes on
that same house.
Even outside California property taxes are much different than income taxes
and sales taxes. For example, I pay relatively high property taxes on my
four-acre home site in New Hampshire. However, I hope to get some of those taxes
returned if and when I elect to sell the property. However, there would be no
return of sales and state income taxes if New Hampshire had taxes on sales and
incomes. This is something I considered when I chose to
retire in New Hampshire. But. given my level of retirement income I
would never consider buying a house in Palo Alto after retiring from my job in
Texas. I could not afford to pay property taxes of $250,000+ per year even if
one day in the future some of those taxes were returned in the selling price of
my Palo Alto house.
States Differ on Retiree Tax Burden ---
http://www.kiplinger.com/article/retirement/T037-C000-S004-states-differ-on-retiree-tax-burden.html
Especially note the graph
Questions in Terms of Retiree Taxation
- Among the three Pacific states of the west, what are the two
worst states to retire?
(California and Oregon)
- Among the non-Pacific western states, what is the worst
state to retire?
(Montana)
- Among the mid-western states, what are the two worst states
to retire?
(South Dakota and Minnesota)
- Among the eastern states, what are the four worst states to
retire?
(New York, Vermont, Massachusetts, and New Jersey)
About 15 percent of the 561,000 pensioners in the
California Public Employees’ Retirement System live their golden years outside
the Golden State, according to a first-of-its-kind analysis of fund data by The
Sacramento Bee. The vast majority have flocked to low-tax or no-tax states,
creating a veritable river of cash that flows out of California and into cities
such as Las Vegas; Reno; Tucson, Ariz.; and Grants Pass, Ore.
http://www.sacbee.com/news/politics-government/the-state-worker/article20702106.html#storylink=cpy
California is one of the five least friendly retirement states in
terms of taxation
Among the 41 states with a broad - based
income tax, 3 6 offer exclusions for some or all specifically
identified state or federal pension income or both , a retirement
income exclusion , or a tax credit targeted at the elderly. The
District of Columbia provides an exclusion for District and federal
pension income . The five states that offer none of these are
California,
Nebraska, North Dakota, Rhode Island and
Vermont. Practice regarding Social Security income varies somewhat
from these generalizations. Federal law preempts t he ability of
states to tax income from Railroad Retirement.
http://www.ncsl.org/documents/fiscal/StateTaxOnPensions2015update.pdf
Question
What will make a healthy tennis star refuse to play in selected major
tournaments and why?
"How Tennis Stars Handle the Tax Man’s Topspin: Players
like Nadal and the Williams sisters show excellent footwork when
protecting their income.," by Allysia Finley, The Wall Street
Journal, September 27, 2015 ---
http://www.wsj.com/articles/allysia-finley-how-tennis-stars-handle-the-tax-mans-topspin-1422401926?tesla=y
In an interview at the Australian Open
last week, Swiss tennis virtuoso Roger Federer was lobbed a
question about Switzerland’s recent decision to unpeg its
currency from the euro and let the franc float. “Does it mean
I’ve got to win now?” the tournament’s 33-year-old second seed
joshed.
The Swiss central bank’s recent gambit
jolted global markets and currency traders, but as Mr. Federer
suggested, a rising franc will also take a bite out of his
winnings. In the past two weeks, the Swiss franc has appreciated
by about 15% relative to the Australian dollar. Mr. Federer was
bumped Friday in the third round and will take home 60,000
Australian dollars ($47,599) in prize money, which will now be
worth about 8,000 francs ($8,868) less. Had he won the
championship, the Swiss currency spike would have cost him
400,000 francs ($443,298).
Mr. Federer and his fourth-seeded
compatriot Stan Wawrinka, who won his fourth-round match Monday,
would be taking even larger blows had not tournament officials
increased the prize money earlier this month to compensate for
the falling Australian dollar. French Open organizers may have
to do the same to account for a weakening euro.
As sport regulators understand, tennis
players respond to economic incentives and often act as
strategically off the court as on. For the past three years
Spain’s Rafael Nadal (eliminated in the Australian Open on
Monday) has bowed out of England’s annual Queen’s Club
tournament, traditionally a Wimbledon warm-up, because the U.K.
charges foreign athletes a prorated tax on their world-wide
income (including endorsements). The more tournaments he plays
in Britain, the more he owes Her Majesty’s Government.
“The truth is, in the U.K. you have a
big regime for tax, it’s not about the money for playing. They
take from the sponsors, from Babolat, from Nike and from my
watches,” Mr. Nadal explained in 2011 to the Times of London. He
endorses a line of luxury timepieces by Richard Mille. “This is
very difficult. I am playing in the U.K. and losing money.”
The top five French players on the
men’s circuit— Jo-Wilfried Tsonga, Gael Monfils, Gilles Simon,
Julien Benneteau and Richard Gasquet, as well as Germany’s
Philipp Kohlschreiber, all claim residence in Switzerland,
ostensibly to avoid paying their home countries’ punitive 45%
top personal income-tax rates (not including surcharges or
social-security contributions).
Many Swiss cantons assess taxes on the
living expenses of foreign high-rollers (typically fives times
the market rate for renting out their residence) rather than on
their income. As a result, Switzerland has become a tax haven
for thousands of wealthy Europeans. Maybe New Jersey Gov. Chris
Christie should consider applying the Swiss tax model in the
Garden State. Jersey City might become the Geneva for New York’s
professional athletes.
Yet the most popular haven for tennis
players is the principality of Monaco, which doesn’t tax
foreigners’ world-wide income. (French athletes choose
Switzerland because la République Française taxes its citizens
who live in Monaco.) Swedish tennis legends Bjorn Borg and Mats
Wilander escaped to Monte Carlo during their primes in the 1970s
and ’80s to dodge their home country’s 90% top marginal rate,
which has since fallen to 57%. In 2002 Germany charged six-time
Grand Slam title-winner Boris Becker with tax evasion for
falsely claiming Monaco as his primary residence.
Today, Monaco is the putative home of
many of the world’s top-ranked men and women players. They
include Serbia’s Novak Djokovic (1), the Czech Republic’s Petra
Kvitova (4), Tomas Berdych (7) and Lucie Safarova (16); Canada’s
Milos Raonic (8); Denmark’s Caroline Wozniacki (8); Bulgaria’s
Grigor Dimitrov (11); and Ukraine’s Alexandr Dolgopolov (23).
Players who hail from former communist countries are especially
keen, it seems, on keeping their hard-earned money.
The U.S. has its own Monaco:
no-income-tax Florida. It’s no coincidence that America’s
top-ranked players Serena (1) and Venus Williams (18) and John
Isner (21), as well as Russia’s Maria Sharapova (2) and Japan’s
Kei Nishikori (5) live in the Sunshine State. So do twins Mike
and Bob Bryan, who have won 16 Grand Slam doubles titles. Like
the Williamses, they come from California, where the 13.3% state
income-tax rate is the nation’s highest.
Jensen Question
What happened to the proposed legislation, possibly in Maryland, to
tax out-of-state income for out-of-state residents?
http://marylandreporter.com/2014/10/02/supreme-court-to-hear-case-on-right-of-maryland-to-tax-out-of-state-income/
Not Necessarily "All" --- But This is a Good Listing
"Here Are All The Things You Can't Deduct On Your Taxes,"
Robert E. Flach, Business Insider, February 20, 2014 ---
http://www.businessinsider.com/non-deductable-items-taxes-2014-2
10 Often Overlooked Tax Breaks That Could Save You Big-Time
---
http://www.businessinsider.com/overlooked-tax-breaks-2014-2
Top 25
Overlooked Tax Deductions
You
wouldn’t believe the number of deductions that are overlooked each
year, by taxpayers just like you. That’s right; these money-saving
deductions are missed by countless income earners every tax season.
Read on and arm yourself to take full advantage of these deductions
and get back what you deserve:
-
Student
loan interest
-
Self-employment tax paid (50% is deductible)
-
Health
insurance premiums for some self-employed persons
-
Penalty on
early withdrawal of savings
-
Alimony
paid (not including child support)
-
Medical
transportation costs
-
Nursing
home medical care expenses
-
Certain
medical aids
-
Hearing
aids, eye glasses, and contact lenses
-
Some
hospital fees
-
Medical
equipment for disabled or handicapped individuals
-
Certain
life-care fees paid to retirement home
-
Alcohol,
drug abuse treatment, and certain stop-smoking treatment costs
-
Special
school costs for mentally or physically handicapped individuals
-
Nursing
service costs
-
Prior year
State income taxes
-
Estimated
state taxes for the last quarter of the year
-
Personal
property taxes on cars, boats, etc.
-
Taxes paid
to a foreign government
-
Mandatory
contributions to state disability funds
-
Points
paid on mortgage or refinancing
-
Property
donated to a recognized charity
-
Cash
contributions to a recognized charity
-
Mileage
costs for charitable activities
-
Qualified
casualty and theft losses
"Most tax-friendly states for retirees," by Robert Powell,
Yahoo Finance, January 31, 2014 ---
http://finance.yahoo.com/news/most-tax-friendly-states-for-retirees-163509985.html
Teaching Case on How New Health-Care Rules Affect Your 2014 Tax
Return
From The Wall Street Journal Accounting Weekly Review on January 16, 2015
How New Health-Care Rules Affect Your 2014 Tax
Return
by: Maria Armental
Jan 09, 2015
Click here to view the full article on WSJ.com
TOPICS: ACA, Individual Taxation
SUMMARY: For 2014, there are only two important
federal income-tax changes for individual taxpayers, beyond the
usual inflation-indexing of tax-rate brackets and various other
parameters. Both have to do with the Affordable Care Act, and
both may be complicated enough to inspire many people to engage
the services of a professional tax preparer.
CLASSROOM APPLICATION: This article offers a
good explanation of tax penalties under the Affordable Care Act.
QUESTIONS:
1. (Introductory) What is the Affordable Care Act? Why
are individual tax returns affected by the ACA?
2. (Advanced) What is minimum essential coverage? What
are the penalties for failure to carry that coverage?
3. (Advanced) Who should be concerned about the
penalty? How is the penalty calculated? How is it reported and
paid?
4. (Advanced) What is the premium assistance tax
credit? Who is eligible for the credit? What are the options for
disbursement of this credit?
5. (Advanced) What is a refundable credit? Why are some
credits refundable and others are not?
Reviewed By: Linda Christiansen, Indiana University Southeast
"How New Health-Care Rules Affect Your 2014 Tax Return," by Maria
Armental, The Wall Street Journal, January 9, 2015 ---
http://blogs.wsj.com/totalreturn/2015/01/09/how-new-health-care-rules-affect-your-2014-tax-return/?mod=djem_jiewr_AC_domainid
Tax forms for 2014—such as W-2s and
1099s—will soon be arriving in the mail, which means it isn’t
too early to start thinking about putting together your Form
1040 for last year.
For 2014, there are only two important
federal income-tax changes for individual taxpayers, beyond the
usual inflation-indexing of tax-rate brackets and various other
parameters. Both have to do with the Affordable Care Act, also
referred to as “Obamacare”—and both may be complicated enough to
inspire many people to engage the services of a professional tax
preparer.
Here’s what taxpayers need to know.
Penalty for failure to carry “minimum essential coverage”
The health-care overhaul established a
new federal income-tax penalty for the failure to carry what it
deems minimum essential coverage. Last year was the introductory
year for the penalty, which can potentially be owed for any
month when qualifying health coverage wasn’t in force. (In
Internal Revenue Service speak, the penalty is called a “shared
responsibility payment.”)
You don’t have to worry about the
penalty if you—and all members of your family, if applicable—had
qualifying coverage for all of last year. In this case, simply
check the box on line 61 of Form 1040, and you’re done.
If you didn’t have qualifying coverage
for the entire year, the first task is to determine if you are
exempt from the penalty. For that, see the instructions to new
IRS Form 8965 Health Coverage Exemptions (and instructions for
figuring your shared responsibility payment). If you were exempt
for last year, file Form 8965 with your 2014 Form 1040 to prove
it.
For additional information on
exemptions, see IRS Publication 5187, Health Care Law: What’s
New for Individuals and Families. (All IRS forms and
publications discussed in this article can be found at
www.irs.gov.)
If you weren’t exempt, the next step is
to calculate the penalty amount that you owe using the work
sheet in the instructions to Form 8965. Enter the penalty amount
on line 61 of your return. For 2014, the penalty can range from
$95 or less to a good deal more for higher-income folks. Also be
aware that the penalty for 2015 and beyond can be much higher
than the penalty for last year. Premium assistance tax credit
The other Affordable Care Act-related
change for 2014 was the debut of the so-called premium
assistance tax credit, or PTC. It is available to eligible
individuals and families who obtain health coverage in a
qualifying plan by enrolling through a state-run insurance
exchange or through the federal exchange (www.healthcare.gov).
In general, you are eligible for the
credit if your household income was between 100% and 400% of the
federal poverty line and you didn’t have access to affordable
employer-sponsored coverage last year. The allowable credit
amount can vary widely depending on your specific circumstances.
(For additional information on the PTC, see IRS Publication
974.)
The PTC can be advanced directly to the
insurance company to lower your monthly premiums, or it can be
claimed when you file your return. You may not know the exact
amount of your allowable PTC for last year until you actually
file your 2014 Form 1040. Calculate the PTC using the new IRS
Form 8962.
If advance PTC payments were made on
your behalf last year, the amount of those payments should be
reported by the exchange to you on the new Form 1095-A, Health
Insurance Marketplace Statement. You should receive Form 1095-A
by no later than early February. Then calculate the difference
between your advance PTC payments (if any) and the PTC amount
you are actually entitled to claim on Form 8962. Enter any
excess PTC amount on line 46 of Form 1040 and pay it when you
file.
The PTC is a “refundable credit.” That
means you can collect the full allowable credit amount even when
it exceeds your federal income tax liability for last year.
Specifically, the PTC amount is first used to reduce your
federal income tax bill. After your bill has been reduced to
zero, any remaining PTC can be either refunded to you in cash or
used to make estimated tax payments for the 2015 tax year.
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Bob Jensen's threads on the ACA legislation ---
http://faculty.trinity.edu/rjensen/Health.htm
Teaching Case on
Home Mortgage Taxation and Planning
From The Wall Street Journal Accounting Weekly Review on November 7, 2014
Homeowners: Fall Planning Brings Spring Tax
Savings
by: Anya Martin
Nov 30, 2014
Click here to view the full article on WSJ.com
TOPICS: Individual
Taxation, Mortgage Deduction
SUMMARY: This
article discusses the rules for homeowners to deduct mortgage
interest and other expenses. Most homeowners who itemize their
taxes can deduct the interest paid on their first and second
mortgages of up to $1.1 million in debt. That total reflects up
to $1 million for home loans and another $100,000 for
home-equity loans. Some homeowners don't realize they can deduct
the mortgage interest paid on second homes. That second home can
even be a boat, mobile home or any structure, as long as it has
plumbing, such as toilets and showers. There are other
deductions and restrictions about which taxpayers should be
knowledgeable.
CLASSROOM APPLICATION: This
is a good article to use to flesh out the rules surrounding home
mortgage deductions.
QUESTIONS:
1. (Introductory) What is a home mortgage? What are the
limits on deduction of mortgage interest?
2. (Advanced) What are the rules regarding deduction of
mortgage interest for a second home? What are the limitations?
What must taxpayers know about this type of deduction? What are
the common mistakes?
3. (Advanced) What other home expenses are deductible?
What are the rules shared in the article?
4. (Advanced) What are the tax laws regarding renting
of a second home? How can taxpayers structure ownership,
financing, and rental income of a second home in order to get
the best tax advantages?
5. (Advanced) What is the Pease Limitation? What does
it limit? Which taxpayers should be careful to plan for this
limitation?
Reviewed By: Linda Christiansen, Indiana
University Southeast
"Homeowners: Fall
Planning Brings Spring Tax Savings," by Anya Martin, The Wall Street
Journal, November 30, 2014 ---
http://online.wsj.com/articles/homeowners-fall-planning-brings-spring-tax-savings-1414597215?mod=djem_jiewr_AC_domainid
What homeowners can do now to prepare for
tax time. Rules for deducting mortgage interest and itemizing
other expenses to lower the tax bill.
Before the first snowflakes of winter,
homeowners should think about spring savings. Steps taken today
could reduce the tax hit on April 15.
Most homeowners who itemize their taxes
can deduct the interest paid on their first and second mortgages
of up to $1.1 million in debt. That total reflects up to $1
million for home loans and another $100,000 for home-equity
loans.
The deductions add up for homeowners
with jumbo mortgages—those above $417,000 in most places and
$625,500 in high-price areas. A hypothetical example looks at a
couple in the 30% tax bracket who files jointly. Assuming their
income is under $300,000, the $24,000 they paid toward mortgage
interest could see a benefit of up to $7,200 in tax savings,
according to Mary Canning, dean emeritus and professor at Golden
Gate University’s Braden School of Taxation and Accounting in
San Francisco.
Some homeowners don’t realize they can
deduct the mortgage interest paid on second homes, Ms. Canning
says. Some of her clients, many of whom are approaching
retirement age, have paid off the mortgage on their primary home
and are buying a vacation home in nearby scenic towns like
Sonoma or Carmel, she adds. With the deduction, “they are
finding it’s quite affordable as opposed to putting up children
and their families in hotels for a vacation,” Ms. Canning says.
That second home can even be a boat,
mobile home or any structure, as long as it has plumbing, such
as toilets and showers. However, an empty lot being held to
build a future retirement home doesn't qualify.
One mistake Ms. Canning often sees:
Homeowners who try to deduct mortgage interest on a second home
that was purchased using a margin loan on their brokerage
account. “Sometimes people are surprised that they cannot make
the deduction,” she says. It isn’t allowed, however, because the
loan “has to be secured against the home.”
Beyond mortgage interest, documenting
other home-related expenses can help further reduce tax bills.
For example, self-employed taxpayers and business owners can
write off some expenses if part of their home qualifies as a
home office, says Robert Winton, a partner at White Plains,
N.Y.-based Citrin Cooperman & Co.
Qualified taxpayers with second homes
can also rent out the property and deduct some of their
expenses, Mr. Winton adds. Deductions can include “maintenance,
insurance and property taxes,” he adds.
Because the IRS doesn't require
reporting of rental income for 14 days or less a year, some
business owners rent their home to their business for a meeting
or retreat and then deduct the rental fee as a business expense
on their company’s tax return, says Robert Walsh, founder and
president of Red Bank, N.J.-based Lighthouse Financial Advisors.
Homeowners can take a few steps now to
prepare for tax time. Diagram and measure home office space and
total square footage, take pictures and save utility, security
and real-estate tax bills, Mr. Walsh says. “If you paint your
home office, it’s a 100% expense to office,” he adds.
Those who rent a second home regularly
may wish to set up a separate bank account for rental earnings
and keep a calendar for days of personal use, Mr. Walsh says.
Of course, with interest rates so low,
tax savings may not be the highest priority for many high-end
home buyers. “For people who are buying a big home and have a
$1.5 million mortgage and it’s your dream home, you don’t mind
not [being able to deduct] all of that interest,” Mr. Walsh
adds.
Here are a few more tips to consider
when looking for tax savings. Be sure to consult a tax
professional or financial adviser for more specifics.
• Income limits. The Internal Revenue
Service limits and phases out Schedule A itemized deductions if
the taxpayer’s adjusted gross income exceeds $250,000 for a
single individual or $300,000 for a married couple, says Mr.
Walsh. Common Schedule A deductions include mortgage interest,
state and local income taxes, sales taxes, and medical expenses
and charitable donations.
The so-called “Pease Limitation,” named
after former Rep. Donald Pease, was enacted by Congress in 1990.
During the Bush tax cuts, the limits went away, but they kicked
back in for 2013.
• Equity means everything. That
$100,000 home-equity loan doesn't have to be used to improve the
home.
• Status matters. Unmarried couples who
file separate tax returns and own their own homes will each get
up to $1.1 million. Conversely, married couples filing separate
returns can only deduct mortgage interest on up to $500,000 of
home debt.
Bob Jensen's personal finance helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
From The Wall Street Journal Accounting Weekly Review on
February 23, 2013
The New Capital-Gains Maze
by: Laura Saunders
Feb 16, 2013
Click here to view the full article on WSJ.com
TOPICS: Accounting, Capital Gains Tax,
Investment Sales, Tax Law, Tax Planning, Taxation
SUMMARY: Amid the political drama surrounding
the "fiscal cliff" negotiations, some investors overlooked
significant tax changes kicking in this year. Most notable:
those on long-term capital gains, or taxable income from the
sale of investments held longer than a year. These are
significant increases, and they raise the value of tax deferral
and careful planning. Investors who have begun to consider these
issues-and many haven't-admit to being confused. Fortunately for
investors, there still are ways to minimize the hit-and even
dodge it. Strategies include carefully timing investment sales,
making charitable donations and family gifts with assets instead
of cash, and minimizing certain income. With markets approaching
record highs, investors need to know them. Topics include:
lowering AGI, using "air pockets", giving appreciated assets to
charity, strategizing family gifts, among others.
CLASSROOM APPLICATION: This article offers a
nice update regarding the changes in the tax law and how
taxpayers can plan to legally minimize taxes. You can use this
article to discuss each of the individual topics discussed in
the article, as well as to show students how valuable tax
planning services are for many taxpayers.
QUESTIONS:
1. (Introductory) What were the "fiscal cliff"
negotiations? How was the law regarding the sale of investments
impacted? What were the biggest changes noted in this article?
2. (Advanced) What is adjusted gross income? What are
the suggestions offered in the article regarding AGI? Why is AGI
an important number for taxpayers?
3. (Advanced) What is an "air pocket" for tax purposes?
How can a taxpayer use a so-called air pocket to reduce tax
liability?
4. (Advanced) Please choose and explain three of the
other tax planning ideas featured in the article. How could
these ideas reduce tax liability without changing the overall
effect of the underlying transaction?
5. (Advanced) If you choose to be a tax professional,
how would you market your services based on what you learned
from reading this article?
Reviewed By: Linda Christiansen, Indiana University Southeast
"The New Capital-Gains Maze," by Laura Saunders, The
Wall Street Journal, February 16, 2013 ---
http://professional.wsj.com/article/SB10001424127887324432004578302123138871136.html?mod=djem_jiewr_AC_domainid&mg=reno64-wsj
Chances are your capital-gains taxes
are going up this year—and if you aren't careful, you could end
up paying more than necessary.
Amid the political drama surrounding
the "fiscal cliff" negotiations, some investors overlooked
significant tax changes kicking in this year. Most notable:
those on long-term capital gains, or taxable income from the
sale of investments held longer than a year.
Under the old system, there were often
only two rates: zero and 15%, depending on your income. Now,
there are three tax tiers: zero, 15% and 20%. More Weekend
Investor
Value Stocks Are Hot—But Most Investors
Will Burn Out Cash Shouldn't Be the Only Apple of Your Eye Is It
Time to Hock the Art? Beyond Long-Term Care Thinking of
'Shorting' Treasurys? Tread Lightly
And that isn't all. There also are
three backdoor tax increases that can push your effective rate
even higher—to nearly 25%.
Experts say many taxpayers whose rate
still is 15% could well owe one-third more than they would have
last year. And many top-bracket taxpayers will owe nearly
two-thirds more, even if their income is that high only because
of a once-in-a-lifetime sale.
"These are significant increases, and
they raise the value of tax deferral and careful planning," says
Vanguard Group tax expert Joel Dickson.
Investors who have begun to consider
these issues—and many haven't—admit to being confused.
"I'm trying to figure out whether it's
even worth it to have a taxable account," says Matt Reiland, a
32-year-old oil-industry financial analyst in Farmington, N.M.,
who now is putting away $1,000 a month.
Fortunately for investors, there still
are ways to minimize the hit—and even dodge it. Strategies
include carefully timing investment sales, making charitable
donations and family gifts with assets instead of cash, and
minimizing certain income. With markets approaching record
highs, investors need to know them.
To be sure, long-term capital gains
still retain many of the advantages investors have cherished for
decades.
Unlike wages, capital gains often can
be timed. Losses on one investment can be "harvested" and used
to offset gains on other investments, even in different years.
Up to $3,000 of capital losses still are deductible against
"ordinary" income such as wages. And whatever an investor's top
rate on gains, it often is far below the rate on ordinary
income, which now can be more than 41%.
It isn't just capital gains that are
affected by the tax changes. The new provisions also apply to
many dividends, and some apply to other investment income,
including interest. But these types of income often are more
difficult to time than long-term gains.
Where You Stand
This year's changes divide taxpayers
into three groups. For joint filers with more than $450,000 of
taxable income or single filers with more than $400,000, the tax
rate on long-term gains is fairly clear, if painful.
It starts with a flat tax of 20% above
those thresholds. Add to that the new "Pease limit," a complex
backdoor increase tied to itemized deductions that is named
after Donald Pease, a former Ohio congressman. In effect, the
Pease limit raises a taxpayer's rate by about 1%, according to
experts at the Tax Policy Center, a nonpartisan research group
in Washington.
Finally, there is a new 3.8% flat tax
on net investment income—unless the investor has sold an
actively managed business—for a total of about 25%.
Thus, for a taxpayer already in the top
bracket, the tax on a $500,000 gain could rise to about $125,000
this year from $75,000 in 2012.
For taxpayers in the next income
tier—couples with $72,500 to $450,000 of taxable income and
single filers with $36,250 to $400,000—the effective rate on a
gain is harder to predict.
It begins with a 15% flat rate, but
taxpayers who cross certain income thresholds owe more because
of the 3.8% net investment income tax, the Pease limit and the
Personal Exemption Phaseout, or PEP, a backdoor increase that
limits personal exemptions.
Here's how it could play out: Say a
couple with two children in college and a third soon to go has
an adjusted gross income of $220,000. They sell long-held
investments to help pay tuition, realizing a $175,000 gain.
Although they are in the 15% bracket for long-term gains, just
as they were in 2012, they'll owe about $5,500 more than they
would have last year due to the new 3.8% tax.
This is where planning can help. If the
couple can lower their income by, say, raising retirement-plan
contributions or spreading the gain over several years, or both,
they might reduce or avoid the extra taxes.
"If they cut this year's gain to
$50,000, the $5,500 would drop about $750," says Roberton
Williams, a tax specialist at the Tax Policy Center.
The last group are investors who owe
zero tax on their long-term gains. They often avoid the 3.8%
tax, the Pease limit and the Personal Exemption Phaseout as
well.
For couples filing jointly, the zero
rate extends up to $72,500 ($36,250 for singles). That might
sound like a low cutoff, says Silicon Valley tax strategist
Stewart Karlinsky, an emeritus professor at San Jose State
University, "but it includes more people than we used to think."
That's because these investors often
have large amounts of tax-free income, thanks to municipal bonds
or Roth individual retirement accounts. If so, they might be
able to realize gains selectively to stay within the zero rate.
Sound complicated? It is—and the
alternative minimum tax can make it worse. But careful planning
is often worth the effort. Here is what to do to minimize your
gains pain this year.
Lower your adjusted gross
income. An especially confusing feature of the new
capital-gains regime is that while rates are tied to taxable
income, for most taxpayers the backdoor increases are tied to
adjusted gross income.
That's the number at the bottom of the
front page of the 1040. It doesn't include itemized deductions
on Schedule A, such as mortgage interest and charitable gifts.
Taxable income does.
To avoid the backdoor taxes, it is
important to minimize your adjusted gross income. Itemized
deductions won't help, but other tax benefits can. Among them:
deductible contributions to retirement plans such as IRAs or
401(k)s; moving expenses; business deductions or losses; capital
losses; rental-property expenses; alimony payments; and health
insurance premiums or health-savings-account contributions,
according to Mr. Karlinsky.
Tax-free income from municipal bonds or
Roth IRAs won't swell adjusted gross income, either. Converting
to a Roth IRA will, however, raise it in the year of the
conversion.
Take advantage of "air
pockets." The tax code stacks income, deductions and
net long-term gains in a way that shrewd taxpayers can exploit.
Here's an example: A retired couple has
$70,000 of adjusted gross income before capital gains and
$30,000 of itemized deductions. (They might also have tax-free
income from munis and Roth IRAs.) According to tax rules, the
deductions reduce their income to about $40,000.
This leaves them with an "air pocket"
of about $33,000 before they cross from the zero rate to the 15%
rate on long-term gains.
If they take a $50,000 gain, nearly
$33,000 of it won't be taxable, while the rest would be taxed at
15%. If their income remains constant for two years and they can
split the gain between the two years (selling at the end of
December and beginning of January, for example), the entire gain
could be tax-free.
This is a great tax-code freebie.
"People in the zero bracket can even harvest gains and raise
their cost basis without owing federal taxes," says Mitch
Marsden, a planner at Longview Financial Advisors in Huntsville,
Ala. Unlike with assets sold at a loss, there's no waiting
period to repurchase assets sold at a gain.
Of course, the value of multiyear
strategies depends in part on Congress not changing the law
again.
Give appreciated assets to
charity. Higher taxes raise the value of making
charitable donations with appreciated assets such as shares of
stock instead of cash. Under current law and within certain
limits, the donor gets to skip the tax and yet take a near-full
deduction for the gift.
Strategize family gifts.
Are you thinking of giving cash to relatives or friends in the
same year that you plan to sell a long-held asset? If your
recipient is in a lower capital-gains bracket, consider giving
him all or part of the asset instead. Taxpayers can give
presents of up to $14,000 per individual per year free of gift
tax, and the move can save on capital-gains tax as well.
For example, say a woman wants to give
$14,000 to her granddaughter, who is between jobs. If she gives
$14,000 of stock shares she bought for $3,000, the granddaughter
could sell the shares and pay no tax if her taxable income is
below $36,250 this year. But if the grandmother sells the shares
herself, the tax bite could range from $1,650 to more than
$2,500.
Hold on for dear life.
The tax code still forgives capital gains on assets held until
death; at that point the asset's full market value becomes part
of the taxpayer's estate. Now that the estate-tax exemption is a
generous $5.25 million per individual (and indexed for
inflation), some investors will find it makes sense to hold
appreciated assets until death in order to avoid higher
capital-gains taxes.
Consider installment sales.
Assets such as land or a business can be hard to sell piecemeal.
But an owner could sell the entire asset in an installment sale
and spread out a gain over several years, assuming the deal
makes overall sense.
Remember the home exemption.
Couples who sell a principal residence after living in it at
least two years get to skip paying tax on up to $500,000 of
gains ($250,000 for singles); only above that does the gain
become part of income.
Beware of lower limits for
trusts. The new 3.8% tax on capital-gains and other
investment income takes effect at $11,950 of adjusted gross
income for trusts—far lower than the $250,000 threshold for
individuals.
But there is an out: The lower limit
applies to income that's retained by the trust, while income
that's paid out to beneficiaries is taxed at their own rates.
"This puts pressure on trustees to make
distributions," says Diana Zeydel, an estate lawyer at Greenberg
Traurig in Miami. Yet the point of some trusts is to retain
gains and accumulate assets, or at least to keep the beneficiary
on a short tether. These issues require expert help.
Don't be driven by taxes.
Don't sell—or hold—an asset just to beat Uncle Sam.
Don't do an installment sale if you can't trust the buyer to pay
up. And don't make charitable or personal gifts solely for tax
reasons.
Continued in article
The Tax Policy Center has a good online tool for making
before-and-after estimations ---
http://calculator2.taxpolicycenter.org/index.cfm
Bob Jensen's personal finance helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#SmallBusiness
Teaching Case on Personal Finance
From The Wall Street Journal Accounting Weekly Review on January 9, 2015
Is a Roth Account Right for You?
by: Laura Saunders
Dec 20, 2014
Click here to view the full article on WSJ.com
TOPICS: Roth IRA,
Tax Planning
SUMMARY: This
article covers Roth accounts, which include both tax-sheltered
individual retirement accounts and company-sponsored 401(k)
savings plans. Roths and traditional plans vary considerably in
many important ways. The biggest difference: With traditional
IRAs and 401(k) plans, savers typically contribute pretax
dollars and then owe tax at ordinary income rates on withdrawals
made after age 59½. But savers using Roth IRAs and Roth 401(k)s
put after-tax dollars instead of pretax ones into their
accounts.
CLASSROOM APPLICATION: This
article offers explanations of aspects of Roth IRAs and 401(k)s,
and contrasts them to traditional IRAs and retirement plans.
QUESTIONS:
1. (Introductory) What is a Roth account? What are the
two types explained in the article?
2. (Advanced) What are the differences between Roth
accounts and traditional ones? Are the differences significant?
3. (Advanced) What are the advantages of Roth accounts?
What are the advantages of traditional accounts? What are the
disadvantages of each?
4. (Advanced) For what people would a Roth account be a
better option? Who should choose the traditional option? Why?
Reviewed By: Linda Christiansen, Indiana
University Southeast
RELATED ARTICLES:
Why Roth Accounts Are Better
by Laura Saunders
Dec 20, 2014
Online Exclusive
Roth Accounts: What Will Congress Do?
by Laura Saunders
Dec 20, 2014
Online Exclusive
"Is a Roth Account Right for You?" by Laura Saunders,
The Wall Street Journal, December 20, 2014 ---
http://www.wsj.com/articles/is-a-roth-account-right-for-you-1419014490?mod=djem_jiewr_AC_domainid&autologin=y
Roth accounts can be a great way to
save for retirement—and it is getting easier to use them.
Roths include both tax-sheltered
individual retirement accounts and company-sponsored 401(k)
savings plans, and, as with traditional versions of these
accounts, assets grow tax-free.
In many other important ways, though,
Roths and traditional plans vary considerably.
The biggest difference: With
traditional IRAs and 401(k) plans, savers typically contribute
pretax dollars and then owe tax at ordinary income rates on
withdrawals made after age 59½. But savers using Roth IRAs and
Roth 401(k)s put after-tax dollars instead of pretax ones into
their accounts.
Roth owners thus forgo a valuable
upfront tax break, but they can get a better one in return:
tax-free withdrawals of assets after age 59½. Roth accounts
have a host of other benefits as well,
such as more flexibility.
Jared Guyer, a 38-year-old
meteorologist in Norman, Okla., likes the fact that, unlike with
a traditional IRA, he and his wife can withdraw contributions to
their Roth IRAs without penalty—making them a de facto emergency
fund.
“Fortunately, we haven’t had to take
money out,” says Mr. Guyer, whose wife just had the couple’s
first child. “But it’s nice to know we could, if push came to
shove.”
To be sure, Roth savings aren’t always
best. “Roth accounts are wonderful to have, but not if the price
of admission—taxes—is too high,” says Natalie Choate, a lawyer
specializing in retirement benefits at Nutter McClennen & Fish
in Boston.
Making the right choice depends on
multiple factors, including income, future tax rates and
changes Congress could make in the
law. Here’s what you need to know.
Easier Access
Until recently, many affluent savers
didn’t have access to Roth accounts. Income limits set by
Congress kept many people from contributing to Roth IRAs, and
Roth 401(k)s weren’t widely available.
Now that is changing. According to
benefits firm
Aon Hewitt, millions of workers have
the option of putting some or all of their 401(k) dollars into a
Roth 401(k). Out of nearly 400 large and midsize firms surveyed,
more than half now offer such an option, compared with only 11%
in 2007—and Aon Hewitt expects the number to grow.
In addition, the Internal Revenue
Service recently issued a ruling making it easier for workers to
move after-tax dollars in a 401(k) plan into a Roth IRA. And in
2010, Congress removed an income cap so that all taxpayers can
convert part or all of a traditional IRA to a Roth IRA.
These expanded options are likely to
boost the trend toward Roth accounts. Although traditional IRAs
hold about $6 trillion—more than 10 times the assets that Roth
IRAs do—Roths are growing much faster.
According to the Investment Company
Institute, a fund-industry trade group, the number of households
with one or more traditional IRAs has held steady at about 27
million over the past decade, while the number with Roth IRAs
has grown 47%, to about 13 million.
A spokesman for brokerage firm
Charles Schwab says it now has nearly
1.2 million Roth IRAs, up 32% in the past five years alone—more
than double the growth of its traditional IRAs.
Tax Breaks
In essence, savers have to decide
whether it’s better to get a tax break now for putting dollars
into a traditional IRA or 401(k) plan, or to put after-tax
dollars into a Roth account and take tax-free withdrawals
later—perhaps in several decades.
The short answer: If you expect your
tax rate on withdrawals will be higher than or the same as your
current tax rate, a Roth account is often the better choice,
experts say.
“The tax comparison is often the main
driver,” says Maria Bruno, a retirement specialist at
financial-services firm Vanguard Group.
In general, many young savers should
opt for Roth accounts, as Mr. Guyer and his wife have done. But
for savers in their peak earning years, it often makes sense to
grab the upfront break a traditional IRA or 401(k) plan offers.
Many savers appear to understand this
rule of thumb. At Vanguard, says Ms. Bruno, people under 30 are
putting 92% of their IRA contributions into Roth accounts.
At the same time, conversions of
traditional IRAs into Roth IRAs, which are fully taxable, peak
between age 65 and 70 at Vanguard. Many of the converters are
probably retirees whose tax rate has recently dropped.
There may be other savers who should
avoid Roth accounts—those who lose tax benefits when their
income is too high.
For example, the American Opportunity
Credit is a valuable tax offset for people paying college
tuition that’s worth up to $2,500 per student each year. But it
phases out beginning at $160,000 of adjusted gross income for
most married couples in 2014.
Continued in article
Bob Jensen's personal finance helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
"Kahng: Path Dependence in Tax Subsidies for Home Sales," by Paul
Caron, TaxProf Blog, January 29, 2014 ---
http://taxprof.typepad.com/taxprof_blog/2014/01/kahng.html
At a time of looming fiscal crisis and
virtual unanimity that tax expenditures must be curtailed, tax
subsidies for homeownership stand out as among the most costly
and unfair of these expenditures. As a result of tax subsidies
for homeownership, the government foregoes billions of dollars
in revenue each year, most of which benefits wealthy taxpayers.
Moreover, subsidies for homeownership encourage overinvestment
in housing and underinvestment in other business sectors, which
impedes economic productivity, jobs creation and the ability of
U.S. businesses to compete in the global marketplace.
Scholars and commentators have analyzed
extensively the tax subsidy for home mortgage indebtedness but
have paid little attention to tax subsidies for home sales. This
Article is the first to undertake a comprehensive examination of
tax subsidies relating to home sales. The central thesis of this
Article is that these subsidies rest upon questionable policy
justifications, flawed logical reasoning, and poor design
choices. To support this thesis, the Article traces the
evolution of tax subsidies for home sales from their surprising
origins in a World War I-era tax preference for requisitioned
ships to their present incarnation as a practically unlimited
tax exemption. This narrative account leads to several important
findings. First, it shows how path dependence and bounded
rationality have led lawmakers and policymakers to make
questionable decisions and support problematic laws. Second, it
demonstrates the power of the real estate lobby to shape the
story — and the resultant legal rules ― from both tax and social
policy perspectives. Finally, it illuminates the political and
rhetorical forces that have shaped tax subsidies for home sales.
The Article argues that only by understanding where we were
before and how we got to where we are now, can we properly
assess where we should go from here.
In assessing tax subsidies for home
sales, the Article evaluates the subsidies by reference to the
established tax policy criteria of efficiency and fairness while
remaining cognizant of the broader context of the social and
economic policies regarding homeownership. Although a
comprehensive assessment of federal housing policies and the
role of tax subsidies in structuring the domestic housing market
lie beyond its scope, the Article offers important new insights
that will contribute significantly to the ongoing policy dialog
about homeownership in our society. In particular, it analyzes
the economic impacts of tax subsidies for home sales, including
whether and to what extent the subsidies contributed to the real
estate bubble. Moreover, the Article highlights the important,
but underappreciated, disparate race and gender impacts of
homeownership as a wealth-building vehicle. Finally, the Article
calls for the repeal of tax subsidies for home sales and argues
that the “exogenous shock” of the global financial crisis
presents a rare and fleeting opportunity to effect this reform.
More at
Lily Kahng (Seattle),
Path Dependence in Tax Subsidies for Home Sales, 65 Ala. L.
Rev. 187 (2013)
How Income Taxes Work (including history) --- http://money.howstuffworks.com/income-tax.htm
Tax Foundation Facts & Figures (Free) ---
http://taxfoundation.org/files/ff2012.pdf
Why not start with the IRS? (The best government agency web site
on the Internet) http://www.irs.gov/
IRS Site Map ---
http://www.irs.gov/sitemap/index.html
FAQs and answers ---
http://www.irs.gov/faqs/index.html
Taxpayer Advocate Service ---
http://www.irs.gov/advocate/index.html
Forms and Publications, click on
Forms and
Publications
Tax ---
http://en.wikipedia.org/wiki/Tax
"Tax Time: Why we pay," by Jill Lepore, The New
Yorker, November 26, 2012 ---
http://www.newyorker.com/reporting/2012/11/26/121126fa_fact_lepore
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Marriage Penalty ---
http://en.wikipedia.org/wiki/Marriage_penalty
For more details see
http://www.lao.ca.gov/1999/121699_marriage_penalty.html
Note that words are misleading in that the intent is truly not to
penalize marriage. Rather the intent is not to subsidize marriage at a
huge expense to tax revenue collection. It is progressive with income
levels of both parties contemplating marriage.
An inconvenient truth of marriage is that it
often brings a tax increase compared with what the couple would pay as
two single people. And the problem is only getting worse: Provisions
taking effect this year will increase the "marriage penalty" for many
high earners. ...
"Wedding Bell Tax Blues," by Laura Saunders, The Wall Street
Journal, June 7, 2013 ---
http://online.wsj.com/article/SB10001424127887324069104578529521517818776.html
The current
provisions are deeply rooted in the tax code and lawmakers would
find them expensive to alter, so marriage penalties for two-earner
couples will probably last longer than many marriages. Here are
strategies that can help lower the bill.
- Reduce reported income
- Time income windfalls where possible
- Consider an IRA charitable rollover
- Consider filing separately
- Don't get married
Note that the marriage penalty is not necessarily eliminated by
getting married and filing separately.
Teaching Case from The Wall Street Journal Accounting Weekly Review on
June 27, 2013
DOMA's Demise: The Tax Fallout
by: Laura Saunders
Jun 26, 2013
Click here to view the full article on WSJ.com
TOPICS: Accounting, DOMA, Estate Tax, Gift Tax,
Marriage Penalty, Tax, Taxation
SUMMARY: The end of the Defense of Marriage Act
brings good news and bad on taxes for same-sex married couples. The
current income tax code was designed with one-earner families in
mind, and has both marriage penalties and bonuses. Experts say that
many two-earner same-sex married couples will likely see an annual
federal income tax increase of hundreds or thousands of dollars. The
penalties are more likely to occur as two partners' incomes
converge, especially if they have children. A marriage bonus is more
likely if one partner earns all or nearly all the income.
CLASSROOM APPLICATION: The Supreme Court's decision
to overturn the Defense of Marriage Act once again highlights the
issues surrounding the "marriage penalty". This topic can be used to
illustrate the differences between filing statuses, as well as the
differences between the taxation of a married vs. and unmarried
couple.
QUESTIONS:
1. (Introductory) What is the "marriage penalty"? Why is it
in the spotlight again as a result of the Supreme Court's decision
on the Defense of Marriage Act?
2. (Introductory) What are the tax filing statuses? Define
each.
3. (Advanced) What is the reasoning behind the marriage
penalty? What is its history?
4. (Advanced) What taxpayers are penalized by marriage?
What taxpayers are benefited by marriage? Why is this tax preference
given to some, and a penalty assessed on others?
5. (Advanced) How are estate and gift taxes affected by
marriage? Is marriage a benefit or a disadvantage for estate and
gift taxes? Why is the law structured in this way?
Reviewed By: Linda Christiansen, Indiana University Southeast
RELATED ARTICLES:
When It Doesn't Pay to Be Married
by Laura Saunders
Jun 10, 2013
Online Exclusive
Wedding-Bell Blues
by Laura Saunders
Jun 08, 2013
Page: B7
"DOMA's Demise: The Tax Fallout," by Laura Saunders, The Wall
Street Journal, June 26, 2013 ---
http://blogs.wsj.com/washwire/2013/06/26/domas-demise-the-tax-fallout/?mod=djem_jiewr_AC_domainid
The end of the Defense of Marriage Act
brings good news and bad on taxes for same-sex married couples.
The current income tax code was designed
with one-earner families in mind, and has both marriage penalties
and bonuses.
Experts say that many two-earner same-sex
married couples will likely see an annual federal income tax
increase of hundreds or thousands of dollars. The penalties are more
likely to occur as two partners’ incomes converge, especially if
they have children. A marriage bonus is more likely if one partner
earns all or nearly all the income.
or example, a married couple with two
teenagers in which each spouse earns $75,000 owes nearly $4,000 more
in tax annually compared with what they would owe as two single
filers, according to calculations made by Roberton Williams of the
Tax Policy Center, a nonpartisan group in Washington. If this couple
has the same $150,000 income but all of it is earned by one spouse,
then they owe nearly $4,600 less than what they would owe as two
single filers, according to Mr. Williams.
Marriage tax penalties and bonuses can
occur at any income level, but the 2013 tax changes has increased
marriage penalties for two-earner couples with more than $250,000 of
adjusted gross income. The Tax Policy Center has a calculator for
determining a couple’s bonus or penalty.
The end of DOMA is a boon to very wealthy
same-sex couples who are planning estates. The current estate and
gift tax exemption is $5.25 million per individual, so married
couples qualify for more than $10 million of exemption. In addition,
a surviving spouse can use the unused portion of the partner’s
exemption to shelter assets in his or her own estate.
Social Security retirement benefits can
contain bonuses for married couples. If there is just one earner,
says Mr. Williams, the non-earner gets an benefit equal to half of
the earner’s benefit on top of what the earner receives. Two-earner
couples can also in many cases use strategies to maximize their
retirement benefits. “Married couples can never get less Social
Security retirement benefits than they would get if the partners
weren’t married,” he says. “Social Security has no marriage
penalty.”
Continued in article
"Planning at the intersection of income and estate taxes," by Patricia
Annino, CPA Insider, January 21, 2014 ---
http://www.cpa2biz.com/Content/media/PRODUCER_CONTENT/Newsletters/Articles_2014/CPA/Jan/EstateTaxes.jsp
Changes to the federal estate tax exemption
make it increasingly important for advisers to focus on the income
tax consequences of estate planning.
The American Taxpayer Relief Act of 2012 (ATRA),
P.L. 112-240, significantly increased the federal estate tax
exemption in 2014 to $5.34 million (adjusted for inflation) and made
permanent portability of the first-to-die spouse’s exemption. The
change means many families no longer have to worry about estate
taxes. But estate planners who have traditionally overlooked the
income tax during planning discussions now need to examine how that
tax intersects with estate taxes.
A refresher course on the taxes’
relationship
If no federal estate tax will be due, giving the asset away
during a person’s lifetime can result in overall higher taxes paid
by the family. Under the ATRA federal income tax
rules, capital gains on appreciated assets will be taxed at a 20%
rate for taxpayers with taxable income over $450,000 (joint filers),
$400,000 (single filers), $425,000 (heads of households) and
$225,000 (married taxpayers filing separately). The capital gains
tax is either 15% or 0% for taxpayers that are below those
thresholds. Also under ATRA, a 3.8% net investment income tax may
apply, with a significantly lower threshold. The net investment
income tax threshold is based on modified adjusted gross income
(adjusted gross income plus any excluded foreign income) and is
$250,000 for joint filers, $200,000 for single filers, $200,000 for
heads of households and $125,000 for married filing separately.
When the asset is given during lifetime,
the recipient takes the income tax basis of the donor if that asset
has appreciated (Sec. 1015(a)). The result may be a significantly
higher overall tax paid than if the asset transferred at death. In
other words, if the donor’s gross estate is less than the federal
estate tax exemption, and there is significant built-in gain in the
asset, then giving it during lifetime will trigger the gain when
that asset is disposed of or sold.
When evaluating the tax cost to a lifetime
gift, practitioners also need to consider the state inheritance and
estate taxes. For states with an estate tax, the exemption is
usually lower than the federal estate tax exemption level, so there
may be a state estate tax due even if no federal estate tax is due.
Retaining the asset until death may result in no federal estate tax,
a state estate tax, and a fresh start income tax basis for income
tax purposes. It is important to run the numbers and determine the
lowest combination of those three taxes to make an informed planning
decision.
If property given during lifetime is depreciated at the time of the
gift, the donee takes as the income tax basis the property’s fair
market value at the time of the gift—but only for the purpose of
taking losses (Sec. 1015(a)). The donee’s basis is increased by all
or a portion of the gift taxes paid on the gift transfer (Sec.
1015(d)(6)).
When the bequest occurs at death, the
income tax basis receives a fresh start and is stepped up to the
date of death value, or the alternate valuation date, if that was
elected (Sec. 1014). This occurs even if no federal estate taxes are
due, meaning that any gain accrued before the date of death
disappears. On the other hand, if the asset was depreciated for loss
recognition purposes, the basis steps down at the time of death and
loss cannot be recognized.
If the taxpayer is domiciled in a community
property state, then the surviving spouse’s share of community
property is treated as acquired from the decedent and receives the
stepped-up or stepped-down basis even if it was not included in the
taxpayer’s federal gross estate (Sec. 1014(b)(6)).
There is a glitch if the decedent had
acquired the asset within one year of death and if, at the
taxpayer’s death, the asset passes back to the donor or the donor’s
spouse. In that case, the basis does not step up (Sec. 1014(e)).
From a planning point of view, if the taxpayer’s health is
declining, it makes sense, if possible, to make the gift more than
one year prior to death and to someone other than the donor or the
donor’s spouse.
Another exception to the stepped-up basis
rules pertains to what is known as “income in respect of a decedent”
under Sec. 691. Sec. 1014(c) provides that these items are to be
included in full in the decedent’s gross estate and treated as gross
income when realized. Essentially, these assets are taxed twice—once
for the estate tax and once for the income tax. There is an income
tax deduction under Sec. 691(c) for the estate tax attributable to
the inclusion of income in respect of decedent on the decedent’s
federal estate tax return.
Examples of assets subject to both taxes
include certain salary and fringe benefits accrued at death, fees
and commissions for services performed during lifetime and paid
after death, and retirement plan assets and dividends. If the
taxpayer’s intention is philanthropic, however, donating these
assets to a qualified charity qualifies for both the estate and
income tax deductions.
In light of the significantly increased
federal estate tax exemption, take into account these income tax
considerations in determining which assets should be transferred
during lifetime, at death, to individuals, and to charities.
Carefully consider the tax
consequences of installment sales
The older generation may decide to sell the family business or
commercial real estate to the next generation on an installment
basis, which freezes the asset’s value for estate planning purposes.
With the significantly increased federal estate tax exemptions,
however, this may no longer be important. For federal income tax
purposes, installment sales allow the taxation to be proportionately
spread out during the years that principal payments are made. Since
this is a lifetime sale, there is no fresh start basis in the
underlying asset and the heir who inherits the note continues to pay
income taxes on the payments as they are received.
Determine when charitable gifts
should be made
Clients who wish to leave a bequest to a charity need to know that
there is no deduction if the estate is not subject to federal estate
tax. If the estate taxes are deferred until the surviving spouse’s
death, and the charitable bequest occurs through the estate of the
first spouse upon his or her death, in all likelihood there will be
no federal estate tax and therefore no estate tax charitable
deduction. Alternatively, the client may decide to make the gift
during his lifetime and obtain the charitable income tax deduction,
or he may ask his spouse to voluntarily make it during her lifetime
if she survives him and take the income tax deduction. His estate
planning documents could stipulate that if the aforementioned action
is not taken then the charitable bequest is to be paid when they
both die.
Continued in article
Bob Jensen's tax helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
"NYC Legend, Ed Koch, Pays $3M Due to Estate Planning Blunder With
No Irrevocable Trust, Laments UltraTrust.com," PRWeb, March 31, 2013
---
http://www.prweb.com/releases/Ed-Koch-irrevocable-trust/estate-plannnig/prweb10549965.htm
Jensen Comment
More accurately former Mayor Koch would've saved something less that $3
million after paying his tax attorneys and CPAs.
Suggestion for his epitaph:
"I should've had an irrevocable
trust."
Links forwarded by Paul Caron
- Forbes,
Ed Koch's Will: Taxes Take Big Bite Out Of Hizzoner's Nest Egg,
by Deborah L. Jacobs
- Wall Street Journal,
The Will Of Koch: Legacy, Family
- Wills, Trusts & Estates Prof Blog,
Ed Koch's Will, by Gerry Beyer (Texas Tech)
- Wills, Trusts & Estates Prof Blog,
Taxes Take a Large Portion of Koch's Estate, by Gerry Beyer
(Texas Tech)
From the
Tax Foundation
"2015 Business Tax Climate: Chilliest in Blue States," by Paul Caron,
TaxProf Blog, October 29, 2014 ---
http://taxprof.typepad.com/taxprof_blog/2014/10/2015-business-tax-climate.html
The
Tax
Foundation yesterday released the
2015 State Business Tax Climate Index,
which ranks the fifty states according to five indices: corporate
tax, individual income tax, sales tax, unemployment insurance tax,
and property tax. Here are the ten states with the best and worst
business tax climates:
1 |
Wyoming
|
41 |
Iowa
|
2 |
South
Dakota |
42 |
Connecticut |
3 |
Nevada |
43 |
Wisconsin |
4 |
Alaska |
44 |
Ohio |
5 |
Florida |
45 |
Rhode
Island |
6 |
Montana |
46 |
Vermont |
7 |
New
Hampshire |
47 |
Minnesota |
8 |
Indiana |
48 |
California |
9 |
Utah |
49 |
New York |
10 |
Texas |
50 |
New Jersey |
Continued in article
Jensen Comment
There are two kinds of tax "climates" in terms of individuals versus
businesses. These two climates are highly correlated but there are some
instances where a state having a high taxation business climate will
give tremendous subsidies and/or tax deferrals to attract businesses and
then clobber the individuals who move into the state. New York, for
example, has tremendous deals exempting business income and sales taxes
for new businesses locating near universities. But the deals do not
extend to workers in those businesses.
Washington State did
not make the Top 10 in terms of business climate taxation whereas
Washington State has no income tax on individuals.
Taxachusetts taxes
individuals in every which way and yet comes in at the middle at Rank 24
in terms of business taxes. This may be the reason some wealthy people
who work at places like Harvard University commute from New Hampshire.
They have to pay a Massachusetts tax on their in-state salaries but they
can shield their portfolio capital gains taxes and royalty incomes by
living in New Hampshire. Harvard's accounting professor Bob Anthony
shielded his huge book revenues from state taxation by commuting in this
way for years.
We keep hearing
horror stories about Illinois business taxes relative to surrounding
states of Indiana and Wisconsin. And yet Illinois did not make the
Bottom 10 in the table above. Illinois is instead ranked near the middle
at Rank 31. Go figure!
Blue is Blue
From the TaxProf Blog on March 6, 2013
The Fiscal Times:
The Ten Worst States for U.S. Taxes:
-
New York
-
New Jersey
-
California
-
Vermont
-
Rhode Island
-
Minnesota
-
North Carolina
-
Wisconsin
-
Iowa
-
Maryland
The liberal governor of Vermont claims that his state's welfare
generosity motivates Vermonters not to seek employment (at least the
kind that does not pay cash under the table) ---
http://www.cs.trinity.edu/~rjensen/temp/Political/PoliticalQuotationsCommentaries.htm#VermontWelfare
Case Studies in Gaming the Income Tax Laws ---
http://www.cs.trinity.edu/~rjensen/temp/TaxNoTax.htm
2014 Update
States With the Highest (and Lowest) Taxes ---
http://247wallst.com/special-report/2014/04/02/states-with-the-highest-and-lowest-taxes/?utm_source=247WallStDailyNewsletter&utm_medium=email&utm_content=APR022014A&utm_campaign=DailyNewsletter
Jensen Comment
States vary in these rankings. For example, Vermont and Maine used to be
the most taxing states. Maine dropped out of the Top 10 and Vermont
dropped to Number 9. Also the tax bite varies a lot with income.
Maryland has a proportionately large number of very wealthy people.
Hence, Maryland makes the Top 10 ranking of the most taxing states. But
this is not so for Maryland's share of the 50% of the USA taxpayers who
pay no income taxes.
Except when people retire, state taxation is probably not the main
driver of where to live. Other things like economic opportunity and life
style preferences are more important before retirement.
Also the differences in the highest taxing states are not all that
great in total, but they can be highly different in terms of certain
individual taxes. For if you commute or otherwise drive a lot,
Pennsylvania is worse than nearly every other state even though is
barely makes the Top 10 list in total state taxation.
It's easy to get around some taxes. For example, since New Hampshire
has no sales tax, New Hampshire is where people from Vermont shop. Hotel
chains build close to Wal-Mart stores in New Hampshire. New Hampshire
Wal-Mart parking lots have to accommodate the big pickup trucks pulling
huge trailers with green Vermont license plates. An added attraction is
the relatively low liquor and cigarette pricing in New Hampshire. New
Yorkers, however, live further away from New Hampshire and are screwed
in many ways by the NY tax collectors. and liquor stores.
IRS Free File Options for Taxpayers Having Less Than $57,000 Adjusted
Gross Income (AGI) ---
http://www.irs.gov/efile/article/0,,id=118986,00.html?portlet=104
Free File Fillable Forms FAQs ---
http://www.irs.gov/efile/article/0,,id=226829,00.html
The IRS has a terrific helper site ---
http://www.irs.gov/
Bob Jensen's tax filing helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Hint:
If you plan to cheat, use TurboTax since our U.S. Treasury Secretary in
charge of the IRS explained how to get away with cheating by using Turbo
Tax ---
http://www.youtube.com/watch?v=eKVxGlkPRlo
Question
What United States president was the first president to successfully
enact the income tax?
Answer
"Brief History of the Income Tax," by Paul Caron, Tax Prof Blog,
February 28, 2012 ---
http://taxprof.typepad.com/
Income Tax in the United States ---
http://en.wikipedia.org/wiki/Income_tax_in_the_United_States
Question
What can a marriage proposal tell you about underlying tax motives?
Hint: Note the colored graph to see when marriage saves tax
dollars.
"Effects of Marriage on Tax Burden Vary Greatly with Income Level,
Equality," by Nick Kasprak, Tax Foundation, January 10, 2013 ---
http://taxfoundation.org/sites/taxfoundation.org/files/docs/ff352.pdf
"A Married Couple's Guide To Estate Planning," by Deborah L.
Jacobs, Forbes, January 9, 2013 ---
http://www.forbes.com/sites/deborahljacobs/2013/01/09/a-married-couples-guide-to-estate-planning/
Jensen Comment
Always remember, however, in the case of marriage termination she gets
the gold mine and you get the shaft ---
http://www.youtube.com/watch?v=U-p0zn3PijY
FTC Identity Theft Center ---
http://www.ftc.gov/bcp/edu/microsites/idtheft/
Identity Theft Resource Center
---
http://www.idtheftcenter.org/
Note the tab for State and Local Resources
IRS Identity Protection
Specialized Unit at 800-908-4490
Are CPAs eligible to receive rewards under the IRS Whistle Blower
Program?
http://www.accountingweb.com/article/tax-court-cpa-whistling-wind/220185?source=tax
"IRS Warns on ‘Dirty Dozen’ Tax Scams for 2012," by Laura
Saunders, The Wall Street Journal, February 12, 2012 ---
http://blogs.wsj.com/totalreturn/2012/02/17/irs-warns-on-dirty-dozen-tax-scams-for-2012/?mod=google_news_blog
Every year during tax season the Internal
Revenue Service releases a list of its least-favorite tax
scams. “Scam artists will tempt people in-person, on-line and by
email with misleading promises about lost refunds and free money.
Don’t be fooled by these,” warns Commissioner Douglas Stives.
The list changes from year to year. Here’s
what the IRS is warning about for this tax season. For more
information, click
here, or watch a video
here.
1. Identity theft
“An IRS notice informing a taxpayer that
more than one return was filed in the taxpayer’s name may be the
first tipoff the individual receives that he or she has been
victimized.”
2. Phishing
“If you receive an
unsolicited email that appears to be from either the IRS or an
organization closely linked to the IRS, such as the Electronic
Federal Tax Payment System, report it by sending it to
phishing@irs.gov.”
3. Tax-preparer fraud
“In 2012 every paid preparer needs to have
a Preparer Tax Identification Number (PTIN) and enter it on the
returns he or she prepares.”
4. Hiding income offshore
“Since 2009, 30,000
individuals have come forward voluntarily to disclose [undeclared]
foreign financial accounts. . . With new foreign account reporting
requirements being phased in over the next few years, hiding income
offshore will become increasingly more difficult.”
5. ‘Free money’ from the IRS and
tax scams involving Social Security
“Flyers and advertisements
for free money from the IRS, suggesting that the taxpayer can file a
tax return with little or no documentation, have been appearing at
community churches around the country.”
6. False/inflated income and
expenses
“Claiming income you did not earn or
expenses you did not pay in order to secure larger refundable
credits such as the Earned Income Tax Credit could have serious
repercussions…. Fraud involving the fuel tax credit is considered a
frivolous tax claim and can result in a penalty of $5,000.”
7. False Form 1099 refund claims
“In this ongoing scam, the perpetrator
files a fake information return, such as a Form 1099 Original Issue
Discount (OID), to justify a false refund claim on a corresponding
tax return.”
8. Frivolous arguments
“Promoters of frivolous
schemes encourage taxpayers to make unreasonable and outlandish
claims to avoid paying the taxes they owe. The IRS has a list of
frivolous tax arguments that taxpayers
should avoid.”
9. Falsely claiming zero wages
“Filing a phony
information return is an illegal way to lower the amount of taxes an
individual owes. Typically, a Form 4852 (Substitute Form W-2) or a
‘corrected’ Form 1099 is used as a way to improperly reduce taxable
income to zero. The taxpayer may also submit a statement rebutting
wages and taxes reported by a payer to the IRS. ”
10. Abuse of charitable
organizations and deductions
“The IRS is investigating
schemes that involve the donation of non-cash assets – including
situations in which several organizations claim the full value of
the same non-cash contribution. Often these donations are highly
overvalued or the organization receiving the donation promises that
the donor can repurchase the items later at a price set by the
donor.”
11. Disguised corporate ownership
“Third parties are improperly used to
request employer identification numbers and form corporations that
obscure the true ownership of the business…. The IRS is working with
state authorities to identify these entities and bring the owners
into compliance with the law.”
12. Misuse of trusts
“IRS personnel have seen an increase in the
improper use of private annuity trusts and foreign trusts to shift
income and deduct personal expenses. As with other arrangements,
taxpayers should seek the advice of a trusted professional before
entering a trust arrangement.”
FTC Identity Theft Center ---
http://www.ftc.gov/bcp/edu/microsites/idtheft/
Identity Theft Resource Center
---
http://www.idtheftcenter.org/
Note the tab for State and Local Resources
IRS Identity Protection Specialized Unit at
800-908-4490
How Income Taxes Work (including history) ---
http://money.howstuffworks.com/income-tax.htm
Why not start with the IRS? (The best government agency web site
on the Internet)
http://www.irs.gov/
IRS Site Map ---
http://www.irs.gov/sitemap/index.html
FAQs and answers ---
http://www.irs.gov/faqs/index.html
Taxpayer Advocate Service ---
http://www.irs.gov/advocate/index.html
Forms and Publications, click on
Forms and
Publications
IRS Free File Options for Taxpayers Having Less Than $57,000 Adjusted
Gross Income (AGI) ---
http://www.irs.gov/efile/article/0,,id=118986,00.html?portlet=104
Free File Fillable Forms FAQs ---
http://www.irs.gov/efile/article/0,,id=226829,00.html
Tax Foundation Facts & Figures (Free) ---
http://taxfoundation.org/files/ff2012.pdf
Visualizing Economics
Comparing Income, Corporate, Capital Gains Tax Rates: 1916-2011 and Other
Graphics ---
Click Here
http://visualizingeconomics.com/2012/01/24/comparing-tax-rates/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+VisualizingEconomics+%28Visualizing+Economics%29&utm_content=Google+Reader
Bob Jensen's tax filing helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
"Will You Have to Pay Capital Gains Taxes on the Sale of Your
Home?" by Carrie Schwab Pomerantz, Townhall, February 21,
2013 ---
Click Here
http://finance.townhall.com/columnists/carrieschwabpomerantz/2013/02/21/will-you-have-to-pay-capital-gains-taxes-on-the-sale-of-your-home-n1515764?utm_source=thdaily&utm_medium=email&utm_campaign=nl
2012 IRS Data Book
Message from Paul Caron on March 26, 2013 ---
http://taxprof.typepad.com/
2012 IRS Data Book
The IRS yesterday released the
2012 IRS Data Book, which contains a wealth of statistical
information for the IRS's Oct. 1, 2011 - Sept. 30, 2012 fiscal
year. Here are the statistical tables:
Returns Filed, Taxes Collected, and Refunds Issued
Enforcement: Examinations
Enforcement: Information Reporting and Verification
Enforcement: Collections, Penalties, and Criminal
Investigation
Taxpayer Assistance
Tax Exempt Activities
Chief Counsel
IRS Budget & Workforce
- Table 28: Costs
Incurred by Budget Activity
- Table 29: Collections,
Costs, Personnel, and U.S. Population
- Table 30: Personnel
Summary, by Employment Status, Budget Activity, and Selected
Type of Personnel
- Table 31:
Internal Revenue Service Labor Force, Compared to National
Totals for Civilian and Federal Labor Forces, by Gender,
Race/Ethnicity, and Disability
First-Time Homebuyer Credit
Press and blogosphere coverage:
"Countdown to a Tax Hike," The Wall Street Journal,
August 31, 2012 ---
http://professional.wsj.com/article/SB10000872396390444772804577619583044242606.html?mod=WSJ_Taxes_Taxes_2&mg=reno64-wsj
The best advice, experts say: make a few
important moves now, and be ready to react quickly in the months
ahead.
To recap: At year's end, rates on ordinary
income, interest, capital gains, dividends, gifts and estates are
set to jump—in some cases sharply. Other tax benefits will lapse as
well, affecting all levels of taxpayers. (Please see the tables
below and on Page B10.)
Few observers expect any major tax
legislation before the Nov. 6 election. After that, there won't be
much time. The House of Representatives has scheduled only 16
working days before its adjournment on Dec. 14. While the Senate has
more days in session, "they don't have much incentive to act if the
House isn't there," notes Clint Stretch, a lawyer and former
executive at Deloitte Tax LLP in Washington.
Experts foresee two possible outcomes. One
is that after the election both houses of Congress agree to extend
the current rules for up to a year, buying time to make fundamental
changes to the tax code while avoiding the economic consequences of
huge tax increases.
The other possibility is that the election
changes the political equation so much that one party blocks a
tax-rate extension, allowing the current rules to expire and pushing
tough decisions into 2013.
Lawmakers return in early January, but Mr.
Stretch and others believe it could take them several months to
reach an agreement and make changes retroactive to the beginning of
the year.
In that scenario, most Americans would be
affected. Employees could see their take-home pay fall as higher tax
rates kick in, for example, while the heirs of people who die will
face a much harsher estate-tax regime.
Lawrence Carlton, an accountant in Bedford,
Mass., says he is getting more than a dozen calls a week asking what
tax rates will be next year: "My clients don't believe me when I
say, 'I'm sorry, I just can't tell you.'"
So how should you prepare for the uncertain
months ahead? Tax experts surveyed by the Wall Street Journal
offered several dos and don'ts:
Continued in article
Jensen Comment
Summary of Dos and Don'ts
- Do consider the effect of higher taxes on
investment returns next year
- Don't rush to take all of your capital
gains
- Do consider whether to accelerate Roth IRA
conversions
- Don't count on an extension of this year's
Social Security tax cut
- Do expect an AMT "patch" for 2012
- Don't take money from your IRA if you are
70½ or older and want to donate money from it
- Do prepare for the possibility of
less-generous gift- and estate-tax rates and exemptions after
2012
AMT ---
http://en.wikipedia.org/wiki/Alternative_Minimum_Tax
"Tax Advice for the Second Obama Administration," by Paul L. Caron,
SSRN, February 18, 2013 ---
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2220496
Abstract:
Twenty-five of the nation’s leading tax academics, practitioners,
journalists, and public intellectuals gathered in Malibu, California on the
Friday before President Obama’s second inauguration to plead for tax reform.
The papers published in this issue of the Pepperdine Law Review provide very
different prescriptions for America’s tax ills. But there is a unanimous
diagnosis that the country’s tax system is sick indeed. A re-elected
president’s inauguration offers a particularly propitious moment to put
politics aside and embark on a treatment plan. If our lawmakers are
interested in healing our tax wounds, the ideas presented in these pages
offer a good place to begin. They run the gamut from relatively minor
procedures to total transplantation. But all would improve the health of our
current tax system.
IRS Identity Protection Specialized Unit at
800-908-4490
"IRS: Identity Theft Crackdown Sweeps Across the Nation:
More than 200 Actions Taken In Past Week in 23 States," SmartPros,
February 1, 2012 ---
http://accounting.smartpros.com/x73338.xml
. . .
To help taxpayers, the IRS earlier this
month created a new, special section on IRS.gov dedicated to
identity theft matters, including YouTube videos, tips for taxpayers
and a special guide to assistance. The information includes how to
contact the IRS Identity Protection Specialized Unit and tips to
protect against “phishing” schemes that can lead to identity theft.
Identity theft occurs when someone uses another’s personal
information without their permission to commit fraud or other crimes
using the victim’s name, Social Security number or other identifying
information. When it comes to federal taxes, taxpayers may not be
aware they have become victims of identity theft until they receive
a letter from the IRS stating more than one tax return was filed
with their information or that IRS records show wages from an
employer the taxpayer has not worked for in the past.
If a taxpayer receives a notice from the
IRS indicating identity theft, they should follow the instructions
in that notice. A taxpayer who believes they are at risk of identity
theft due to lost or stolen personal information should contact the
IRS immediately so the agency can take action to secure their tax
account. The taxpayer should contact the IRS Identity Protection
Specialized Unit at 800-908-4490. The taxpayer will be asked to
complete the IRS Identity Theft Affidavit, Form 14039, and follow
the instructions on the back of the form based on their situation.
Taxpayers looking for additional information can consult the
Taxpayer Guide to Identity Theft or the IRS Identity Theft
Protection page on the IRS website.
IRS Identity Protection Specialized Unit at
800-908-4490
"Students and Families Miss Out on Millions in Tax Breaks, Report
Says," by Michael Stratford, Chronicle of Higher Education,
June 18, 2012 ---
http://chronicle.com/article/StudentsFamilies-Miss-Out/132371/
About 1.5 million tax filers in 2009 did
not take advantage of the higher-education tax benefits for which
they appeared to be eligible, according to
a government report
released on Monday.
The report, by the Government
Accountability Office, says students and their families missed out
on average tax benefit of $466. The missed savings totaled
$726-million.
Tax benefits for higher education—which
include the American Opportunity Credit, the Lifetime Learning
Credit, and deductions for tuition payments and interest paid on
student loans—each year total about $30-billion. But about 14
percent of the people who were eligible for the benefits in the 2009
tax year did not use them, the GAO found.
And even among those who did take advantage
of some higher-education tax benefit, the report says many did not
use them effectively. For example, nearly 40 percent of the students
and families who took the tuition deduction could have saved more
money by claiming the Lifetime Learning Credit instead. Filers who
didn't maximize their tax savings paid an average of $284 more than
they had to, for a total of approximately $67.2-million.
The Government Accountability Office says
that, since 2005, it has repeatedly found that millions of filers
eligible for higher-education tax breaks have failed to claim them.
In the report the GAO recommends that the Internal Revenue Service
and Department of Education work together to develop a "coordinated,
comprehensive strategy" aimed at better informing students about the
benefits for which they are eligible.
Increasing Inequality for Economic Growth
Marginal Tax Rates Around the World ---
http://www.econlib.org/library/Enc/MarginalTaxRates.html
"How Much the Rich Pay Mitt Romney, the 1% and taxes," The Wall
Street Journal, January 20, 2012 ---
http://online.wsj.com/article/SB10001424052970204555904577168683705018156.html?mod=djemEditorialPage_t
Mitt Romney's disclosure this week that his effective federal tax
rate is "probably closer to the 15% rate than anything" has created
the predictable political uproar. The White House and its media
allies figure they've now got their stereotype of the Monopoly man,
albeit without his cane and top hat, who they can crush in their
planned class-warfare campaign.
We're not sure if facts will matter in this cacophony, but
someone should at least try to introduce a little reality into the
debate, especially since Mr. Romney seems so unprepared to make the
case.
Start with the fact that, like Warren Buffett, Mr. Romney said he
makes most of his money from investments, not wages or salary. Thus
his income is really taxed twice: once at the corporate tax rate of
35%, then again at a 15% tax rate when it is passed through to him
as dividends or via capital gains from the sale of stock.
All income from businesses is eventually passed through to the
owners, so to ignore business taxes creates a statistical illusion
that makes it appear that the rich pay less than they really do. By
this logic, if the corporate tax rate were raised to, say, 60% from
today's 35% and the dividend and capital gains tax were cut to zero,
it would appear that business owners were getting away with paying
no federal tax at all.
This all-too-conveniently confuses the incidence of a tax with
the burden of a tax. The marginal tax rate on every additional
dollar of capital gains and dividend income from corporate profits
can reach as high as 44.75% at the federal level (assuming a company
pays the 35% top corporate rate), not 15%.
The Congressional Budget Office recently examined the
distribution of federal taxes on various income groups. The report
was ballyhooed by liberals as proof of rising income inequality, but
that argument is for another day. What everyone has ignored is what
CBO found about the relative taxes paid by different groups. And,
lo, the rich pay more, which is probably why the press didn't report
it.
The nearby table from the CBO report shows that in 2007 the
average income tax rate paid by the 1% was 18.8%, compared to 4.2%
for Americans in a broadly defined middle class from the 21st to
80th income percentiles. The poorest 20% on average paid a net
negative income-tax rate of 5.6% because of the checks they receive
for tax credits that are "refundable." These are essentially
transfer payments redistributing income from the rich and middle
class to the poor.
As for all federal taxes, CBO found that in 2007 the top 1% paid
an average rate of a little under 30%, compared to 15.1% for
middle-income earners. In calculating this overall tax burden, CBO
takes account of payroll taxes, which moves the rate of the lowest
20% of earners into positive territory at 4.7%. CBO also apportions
to individuals who are shareholders the tax that corporations pay on
corporate profits.
Continued in article
"20 Jan, 2012, 06.34PM IST, New York Times Why Americans think the
tax rate is high when it is not," The Economic Times ---
http://economictimes.indiatimes.com/news/international-business/why-americans-think-the-tax-rate-is-high-when-it-is-not/articleshow/11568197.cms
When people heard that Mitt Romney's
federal income tax rate was about 15 per cent, the immediate
reaction of many was to assume that their own tax rate was higher.
The top marginal rate is 35 per cent, after all, and the marginal
rate on a couple with $70,000 in taxable income is 25 per cent.
But the truth is that most households
probably pay a lower rate than Romney. It is impossible to know for
sure, given that he has yet to release his tax return. What is
clear, though, is that a large majority of US households - about two
out of three - pays less than 15 per cent of income to the federal
government, through either income taxes or payroll taxes.
This disconnect between what we pay and
what we think we pay is nothing less than one of the country's
biggest economic problems.
Many Americans see themselves as struggling
under the weight of a heavy tax burden (partly for the
understandable reason that wage growth has been so weak). Yet taxes
in the United States are quite low today, compared with past years
or those in other countries. Most important, US taxes are not
sufficient to pay for the programs that many people want, like
Medicare, Social Security, road construction and education
subsidies.
What does this combination create? An
enormous long-term budget deficit.
Together, all federal taxes equaled 14.4
per cent of the nation's economic output last year, the lowest level
since 1950. Add state and local taxes, and the share nearly doubles,
to about 27 per cent, according to the Tax Policy Center in
Washington - still lower than at almost any other point in the past
40 years.
As the economy recovers and incomes rise,
tax payments will increase somewhat. But they will not keep pace
with projected spending, in the form of Medicare, Medicaid and
Social Security. And total taxes at current rates would still make
up a smaller share of the economy than in virtually any other rich
country - not just European nations but also Australia, Canada,
Israel and New Zealand.
Obviously, tax increases are not the only
way to solve the deficit. Spending cuts can, too. But so far, at
least, many voters seem to prefer small, symbolic cuts, like those
to foreign aid. Substantial cuts - be they the changes to Medicare
that President Barack Obama included in his health care bill or the
Medicare overhaul that Republicans prefer - tend to be politically
unpopular.
Since the late 1970s, just before the
modern tax-cutting push began, total federal tax rates have fallen
for every income group. The payroll tax has risen, but declines in
the income tax have more than made up for those increases. Nearly
half the population now pays no federal income tax.
Most households pay less than 15 per cent
of their income to the federal government because of tax breaks,
like the exclusion for health insurance, and because marginal rates
apply to only a small part of a taxpayer's income. On the first
$70,000 of a couple's taxable income, the total federal income tax
rate is only 13.8 per cent.
That said, taxes have fallen the most for
the very affluent. Romney and his father - George W. Romney, the
former automobile executive, Michigan governor and presidential
candidate - do a nice job of illustrating the change.
Continued in article
Jensen Comment
Of course rich and poor alike pay other taxes such as taxes at the fuel
pump and payroll deduction taxes if those ever come back (which seems
increasingly unlikely in our political dogfight). And there are serious
ways to be mislead by media-alleged tax rates. For example, do you
compute the tax rate that you're paying now on your own tax return on
the basis of full gross income versus adjusted gross income after
exclusions and deferrals for such thinks as interest on municipal bonds,
401-K deferrals, and other tax breaks in the current tax rules? Chances
are if you divide your 2011 what you pay in 2011 federal income taxes by
the full "gross" income you will find that you're paying 10% or less.
Of course rich people take greater advantages of such tax law
provisions such as exemption of interest on municipal and school bonds.
But in a sense they are paying a virtual tax on those exemptions since
municipal and school bonds have lower interest returns and/or more
default risk. Hence computing the marginal rate that rich people pay
in taxes becomes more complicated than you will ever learn from watching
MSNBC or reading the New York Times.
Tax accounting professors Rodney Mock
(Cal Poly) and Nancy Shurtz (Oregon) published an opinion piece in the
April 16, 2012 edition of The Wall Street Journal..
"Mock and Shurtz: The TurboTax Crime Wave," by Rodney P. Mock
and Nancy Shurtz, The Wall Street Journal, April 16, 2012 ---
http://online.wsj.com/article/SB10001424052702304444604577339840734386180.html?mod=djemEditorialPage_t
Jensen Comment
The so-called Turbo Tax defense has been rejected by the IRS in all but
two cases in history (apart from Timothy Geithner's infamous Turbo Tax
defense when seeking to be appointed as U.S. Treasury Secretary. These
rejections have led to free online consulting services by leading
developers of tax preparation services to deal with instances where
generalized tax software does not deal with very special and peculiar
tax questions. When taxpayers get tax advice directly from consultants
it tends to reduce chances of hard nose rejections by the IRS.
"The New Capital-Gains Maze," The Wall Street Journal,
February 15, 2013 ---
Click Here
http://professional.wsj.com/article/SB10001424127887324432004578302123138871136.html?KEYWORDS=Laura+Saunders&mg=reno64-wsj
Chances are your capital-gains taxes are
going up this year—and if you aren't careful, you could end up
paying more than necessary.
Amid the political drama surrounding the
"fiscal cliff" negotiations, some investors overlooked significant
tax changes kicking in this year. Most notable: those on long-term
capital gains, or taxable income from the sale of investments held
longer than a year.
Under the old system, there were often only
two rates: zero and 15%, depending on your income. Now, there are
three tax tiers: zero, 15% and 20%. And that isn't all. There also
are three backdoor tax increases that can push your effective rate
even higher—to nearly 25%.
Experts say many taxpayers whose rate still
is 15% could well owe one-third more than they would have last year.
And many top-bracket taxpayers will owe nearly two-thirds more, even
if their income is that high only because of a once-in-a-lifetime
sale.
"These are significant increases, and they
raise the value of tax deferral and careful planning," says Vanguard
Group tax expert Joel Dickson.
Investors who have begun to consider these
issues—and many haven't—admit to being confused.
"I'm trying to figure out whether it's even
worth it to have a taxable account," says Matt Reiland, a
32-year-old oil-industry financial analyst in Farmington, N.M., who
now is putting away $1,000 a month.
Fortunately for investors, there still are
ways to minimize the hit—and even dodge it. Strategies include
carefully timing investment sales, making charitable donations and
family gifts with assets instead of cash, and minimizing certain
income. With markets approaching record highs, investors need to
know them.
To be sure, long-term capital gains still
retain many of the advantages investors have cherished for decades.
Unlike wages, capital gains often can be
timed. Losses on one investment can be "harvested" and used to
offset gains on other investments, even in different years. Up to
$3,000 of capital losses still are deductible against "ordinary"
income such as wages. And whatever an investor's top rate on gains,
it often is far below the rate on ordinary income, which now can be
more than 41%.
It isn't just capital gains that are
affected by the tax changes. The new provisions also apply to many
dividends, and some apply to other investment income, including
interest. But these types of income often are more difficult to time
than long-term gains.
Where You Stand
This year's changes divide taxpayers into
three groups. For joint filers with more than $450,000 of taxable
income or single filers with more than $400,000, the tax rate on
long-term gains is fairly clear, if painful.
It starts with a flat tax of 20% above
those thresholds. Add to that the new "Pease limit," a complex
backdoor increase tied to itemized deductions that is named after
Donald Pease, a former Ohio congressman. In effect, the Pease limit
raises a taxpayer's rate by about 1%, according to experts at the
Tax Policy Center, a nonpartisan research group in Washington.
Finally, there is a new 3.8% flat tax on
net investment income—unless the investor has sold an actively
managed business—for a total of about 25%.
Thus, for a taxpayer already in the top
bracket, the tax on a $500,000 gain could rise to about $125,000
this year from $75,000 in 2012.
For taxpayers in the next income
tier—couples with $72,500 to $450,000 of taxable income and single
filers with $36,250 to $400,000—the effective rate on a gain is
harder to predict.
It begins with a 15% flat rate, but
taxpayers who cross certain income thresholds owe more because of
the 3.8% net investment income tax, the Pease limit and the Personal
Exemption Phaseout, or PEP, a backdoor increase that limits personal
exemptions.
Here's how it could play out: Say a couple
with two children in college and a third soon to go has an adjusted
gross income of $220,000. They sell long-held investments to help
pay tuition, realizing a $175,000 gain. Although they are in the 15%
bracket for long-term gains, just as they were in 2012, they'll owe
about $5,500 more than they would have last year due to the new 3.8%
tax.
Continued in article
From The Wall Street Journal Accounting Weekly Review on April
6, 2012
Tax Pitfalls for Fund Investors
by: Rachel Louise Ensign
Apr 05, 2012
Click here to view the full article on WSJ.com
Click here to view the video on WSJ.com
TOPICS: Capital Gains, Personal Taxation, Tax Laws,
Tax Planning
SUMMARY: This article is the first in an entire
report on tax strategies and other issues related to investing in
mutual funds. The related video discusses the potential changes in
taxation from expected lapses in current tax laws. As well, the
article has a related Podcast of only audio broadcast at
http://podcast.mktw.net/wsj/audio/20120402/pod-wsjepensign/pod-wsjepensign.mp3
that discusses "mistakes mutual fund investors make"-the focus of
this article.
CLASSROOM APPLICATION: The article is useful in a
class on personal taxation when covering topics related to Schedule
D and to IRAs.
QUESTIONS:
1. (Introductory) What is the difference in tax treatment
between ordinary income and capital gains? How are these terms
defined in tax law?
2. (Advanced) Why should an investor consider putting
certain types of investments in an IRA or 401(K) plan while
including others in taxable investment accounts?
3. (Advanced) If an investor has capital gains on an
investment but also has incurred losses on another investment, what
should that investor do? How must an investor be careful to avoid
"wash sale rules"? In your answer, define the term "wash sales."
4. (Advanced) Why are gains on investments in an
exchange-traded funds (ETFs) that hold gold taxed differently than
are gains on investments in other mutual funds?
5. (Advanced) According to the related podcast, when
considering whether to invest in a Roth IRA or a 401 K, investors
should consider what changes to tax rates are expected. Why?
Reviewed By: Judy Beckman, University of Rhode Island
"Tax Pitfalls for Fund Investors," by Rachel Louise Ensign, The
Wall Street Journal, April 5, 2012 ---
http://online.wsj.com/article/SB10001424052970204603004577269872566639722.html?mod=djem_jiewr_AC_domainid
Fund investors can go wrong in all sorts of
ways. But since mid-April is fast approaching, let's talk about one
of the most common and least understood: taxes.
Even if it is too late to do anything about
this year's returns, it is a good time to start planning for next
year's.
At the root of the most common blunders are
three types of taxable fund payouts: interest income, dividends and
capital gains. While all three are subject to a complex web of tax
rates and regulations, investors can limit their tax bills by
understanding their funds, planning carefully and staying abreast of
tax changes in Washington.
Here, according to financial advisers, are
five of the biggest mistakes many fund investors make:
1. Keeping 'tax-inefficient'
funds in a taxable brokerage account
Some types of funds distribute lots of
dividends, interest income and capital gains, all of which can boost
tax bills. Many investors would be better off holding those funds in
tax-sheltered retirement accounts. With a standard 401(k) plan or
individual retirement account, you pay tax only when you make
withdrawals; earnings and withdrawals usually are tax-free in a Roth
401(k) or Roth IRA.
Tax-efficient funds—those unlikely to make
big distributions—can be left in a taxable account, says Michael
Gibney, a financial adviser in Riverdale, N.J. You will owe
capital-gains tax if you sell those securities at a gain, but at
least the timing of such sales is under your control.
Taxable-bond funds, including high-yield
funds and funds holding Treasury inflation-protected securities, are
among the investments you might consider holding in an IRA, advisers
say. Ditto for funds that emphasize high-dividend stocks. Meanwhile,
index funds that track a broad stock-market benchmark—and most but
not all ETFs—might be candidates for a taxable account, as would
municipal bond funds, since interest earned is tax-free.
Determining whether a fund is going to have
capital gains can be tricky. Each year, funds must distribute gains
if portfolio managers sell securities for a net taxable gain. One
indicator is the level of turnover in the portfolio, though,
admittedly, it is an imprecise gauge.
The higher a fund's turnover, a figure that
can be found on
Morningstar.com,
the more likely it is to pay out capital gains, says Mark Armbruster,
president of Armbruster Capital Management, which is in the
Rochester, N.Y., area. If a fund has paid out capital gains in the
past, something that also can be found on Morningstar, that also is
a sign it may do so again, he says.
Small-stock funds may produce more capital
gains than large-stock funds, advisers say, because there are many
more small stocks to trade among.
Broad index funds, which don't change their
holdings very often, are less likely to pay out capital gains than
some actively managed funds that change their investments based on
market conditions. The
Vanguard 500 Index fund, for example, has
a 4% turnover ratio and hasn't distributed capital gains since 1999.
The actively managed
CGM Focus, on the other hand, has a nearly
500% turnover rate. It has performed poorly in recent years, so it
hasn't been in a position to distribute gains, but it distributed
$8.21 a share in mostly short-term capital gains in 2007.
Still, when and why a fund realizes capital
gains is complex, so "turnover is only a very rough gauge of tax
efficiency," says Christine Benz, director of personal finance at
Morningstar. Another gauge is Morningstar's "potential capital-gains
exposure" statistic, an estimate of the percentage of a fund's
assets that represent mostly unrealized gains.
ETFs, in particular, rarely distribute
capital gains, Mr. Armbruster says. That is because most are index
funds but also because they are structured to minimize taxable sales
of portfolio securities.
2. Holding on to funds that cost
you big
Capital gains, whether taken on purpose by
the investor or passed along by a fund, can add to your tax bill.
But you can lessen their impact by strategically booking capital
losses when holdings decline in value, so that they offset any gains
dollar for dollar. In any year, if your capital losses exceed your
capital gains, you can take up to $3,000 of the loss as a tax
deduction and carry the rest of the loss forward to offset gains in
future years.
This "tax-loss harvesting" has to be done
carefully, however, to comply with Internal Revenue Service rules.
Once you sell a fund or other security at a loss, you have to wait
30 days before buying either that same fund or a very similar fund
(for instance, one that tracks the same index), or the loss is
invalidated. "The securities cannot be 'substantially identical,' "
says Gil Charney, principal tax researcher at the Tax Institute at
H&R Block, a division of H&R Block Inc., but "the IRS never clearly
defined what substantially identical means.… It's gray."
If you want to keep exposure to the sector
that fund covered, you can buy a slightly different fund—for
instance, you likely could sell a fund tracking the Standard &
Poor's 500-stock index and immediately buy one tracking the Russell
1000, says Mr. Armbruster. You could later return to your original
holding.
Keep tax-loss harvesting in mind any time
the market or a particular holding suffers a major decline; you'll
miss opportunities if you think about this only near year-end.
3. Buying an ETF without learning
what its tax treatment is
Gains and income from certain ETFs are
subject to funky tax rules because of the funds' holdings or their
corporate structures. Though most of these aberrations invest in
niche industries, some of the most popular ETFs could leave you with
a surprisingly large tax bill.
The most popular offender: Gains from
selling
SPDR Gold Shares,
GLD +0.70%
the second-largest exchange-traded product by
assets, are taxed at a top 28% rate on collectibles, rather than the
maximum 15% rate on long-term capital gains. That is true for all
other funds that hold physical precious metals.
There are different rules for ETFs that
provide commodities exposure by investing in futures contracts:
Gains are taxed 60% at a long-term rate and 40% at a short-term
rate. ETFs structured this way include some from the U.S. Commodity,
PowerShares and ProShares families.
Also, some non-stock ETFs are structured as
partnerships and report their tax information on a Schedule K-1
instead of the common 1099 form. Schedule K-1 typically is sent
later than a 1099—it may not even arrive before your tax return is
due because the partnership has to file its own return before
sending you this form, says Eric Smith, an IRS spokesman. In this
situation, you'll want to ask for an extension from the IRS, he
says. You can avoid these hassles by holding these funds in an IRA.
4. Fudging the new forms
Reporting securities sales on your tax
return has gotten more complex, with new rules that require
brokerage firms and fund companies to report to the IRS what you
paid for some securities you sell. Because that reporting applies
only to securities purchased after specified dates, you may have
sales of both "covered" and non-covered assets. As in the past, for
non-covered securities, the financial firm may voluntarily provide
cost information only to you.
The new rules could make tax preparation
more complex, tripping up some investors.
"Basically what they've done is taken
Schedule D and added a new schedule behind it—Form 8949. All the
transactions you used to put directly on Schedule D…are now on this
new form," says Robert Schmansky, a financial adviser in Bloomfield
Hills, Mich.
The most important thing to know about Form
8949 is that you will have to separate the covered transactions from
those that aren't and report them on different lines. Individual
stocks purchased on or after Jan. 1, 2011, are covered; for mutual
funds and most ETFs, the new treatment applies to purchases on or
after Jan. 1, 2012. Then, you must add the covered and non-covered
transactions and put the total on Schedule D.
5. Investing without paying
attention to the tax debate in Washington
When deciding when to take gains and what
account to hold various funds in, it is important to stay abreast of
what is going on in Washington.
Think hard about where tax rates are likely
headed in the future. While some tax changes affecting funds are
already in store, some experts watching the political debate—and the
ballooning federal deficit—say investors may want to hedge their
bets against higher rates and pay taxes on their gains soon.
There are a number of big tax changes on
tap starting in 2013 that could deal a huge blow to your funds. If
the Bush tax cuts are allowed to expire, the top rate on ordinary
income and short-term capital gains will rise to 39.6% from 35%.
The current top 15% rate on long-term
capital gains is set to rise to 20%. Qualified dividends will no
longer be taxed at a top 15% rate and will be taxed as ordinary
income. Also, net investment income, which includes dividends,
interest and capital gains, will be subject to a new 3.8% Medicare
tax, part of the Affordable Care Act, for married couples filing
jointly who earn more than $250,000 a year and individuals earning
more than $200,000 a year.
One possibility is that some of the current
rates will be extended for most taxpayers, but not for high earners.
"People who are over the $250,000 mark—Obama has drawn a line in the
sand for those people," says Ken Weingarten, a financial adviser in
Lawrenceville, N.J. "It's going to be crazy after the election.
There is going to be a lot of horse trading to get these things
straightened out."
Continued in article
Bob Jensen's tax helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
"A New Theory of the State Corporate Income Tax: The State
Corporate Income Tax as Retail Sales Tax Complement," by Darien
Shanske, SSRN, June 5, 2012 ---
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2078488
Tax Law Review, Forthcoming
Abstract:
The state corporate income tax has been and remains a vital source
of income for the states. The theoretical justifications for this
tax, however, are weak and, as reasonably predicted based on its
poor design, the state corporate income tax has been in decline as a
source of state revenue for decades. Nevertheless, states have taken
important steps to shore up their corporate income taxes. At least
one of these major reforms, apportioning the state corporate income
tax base on the basis of in-state corporate sales, was probably
undertaken on the basis of implausible policy arguments. Despite the
ad hoc (at best) nature of these reforms, they have changed the
state corporate income tax for the better. An initial goal of this
Article is to collect this positive news at a time when most fiscal
news remains bleak.
The argument at the heart of this Article
starts from the analytical observation (first made by Charles McLure)
that these changes to the state corporate income tax have made the
tax into an odd type of sales (consumption) tax. This Article then
argues that this observation is important because this new corporate
income tax is reaching sales on which no retail sales tax is due
(e.g., most services) and sales on which no retail sales tax is
generally remitted (e.g., sales made by certain internet retailers).
This means that the new corporate income tax is acting not only like
a sales tax, but as a complement to poorly designed state sales
taxes. This Article argues that, assuming that states will not act
directly to broaden their sales tax base, they can act to broaden
their consumption tax base indirectly through their corporate income
taxes.
PBS Video: What Do Tax Rates' Ups and Downs Mean for
Economic Growth?
http://video.pbs.org/video/2176062522
Thank you Paul Caron for the heads up.
Marginal Tax Rates Around the World ---
http://www.econlib.org/library/Enc/MarginalTaxRates.html
Although I favor raising taxes at all
income levels with much higher marginal rates for the wealthy, keep in
mind that there are limits. A close friend in Sweden argued that at one
point for certain wealthy Swedes like him the marginal
tax rate exceeded 100% --- which has to really discourage both
working and investing risk capital.
In the 1970s and 1980s economic growth in Sweden was very low compared
to other Western European nations, and much of this is attributed to
high marginal tax rates (80+%) on workers in
general and even higher for wealthy Swedes, many of whom shifted their
wealth and even themselves out of Sweden ---
http://en.wikipedia.org/wiki/Sweden
A
bursting
real estate bubble caused by
inadequate controls on lending combined with an
international recession and a
policy switch from anti-unemployment policies to anti-inflationary
policies resulted in a fiscal crisis in the early 1990s.]
Sweden's GDP declined by around 5%. In 1992, there was a run on the
currency, with the central bank briefly jacking up interest to 500%.
The response of the government was to cut spending and institute a
multitude of reforms to improve Sweden's competitiveness, among them
reducing the
welfare state and
privatising public services and
goods. Much of the political establishment promoted EU membership, and
the Swedish referendum passed with 52% in favour of joining the EU on 13
November 1994. Sweden joined the
European Union on 1 January 1995.
Marginal Tax Rates by Country ---
http://www.nationmaster.com/graph/tax_hig_mar_tax_rat_ind_rat-highest-marginal-tax-rate-individual
By 2009, Sweden had dropped its marginal tax
rate of well over 80% to 57%. This still leaves Sweden with the
third-highest marginal tax rate. At a
marginal tax rate of 35%, the United States is
tied with many nations at Rank 37. The reason almost half of U.S.
taxpayers, many of whom are well above the poverty level, pay zero or
very low income tax is that there are so many
ways to avoid or defer income taxes, especially with all the newer types
of credits available in the revised U.S. Tax
Code.
Sometimes what appears to be a raising of income taxes is merely a
shifting of taxes such as when huge and painful increases on a state's
cost of capital are passed to its more regressive sales and property
taxes and apartment rentals. It will be very tough if school districts,
towns, cities, counties, and states must compete head-to-head in bond
markets with corporations.
The problem with tax exempt bonds is that there
are gazillions of dollars invested in these bonds such that even small
increases in tax-exempt cost of capital can
clobber citizens in need of schools, road repairs, welfare, etc.
Rates Versus Enforcement
Marginal Tax Rates by Country ---
http://www.nationmaster.com/graph/tax_hig_mar_tax_rat_ind_rat-highest-marginal-tax-rate-individual
One of the problems in comparing
marginal tax rates and economic growth by country is the enormous
problem of variations in tax enforcement between nations. Countries
(read that Greece and Italy) may have relatively high marginal tax rates
where enforcement is a sham. Illinois just imposed one of the largest
tax rate increases among all 50 states in the United States. But
Illinois is handing out "Get Out of Tax Free" cards right and left for
large corporations that threaten to pull up stakes in Illinois and move
on to states that have lower tax rates.
Benefits Covered in Tax
Payments
Marginal Tax Rates by Country ---
http://www.nationmaster.com/graph/tax_hig_mar_tax_rat_ind_rat-highest-marginal-tax-rate-individual
Another problem in comparing marginal
tax rates and economic growth by country is that countries vary in terms
of what taxpayers receive in return. Many nations provide health care
benefits for all citizens in revenues collected from taxes. Others
provide less health services from taxation. Some nations can keep taxes
lower because they are protected by the military might of neighbors.
Canada, for example, has never had to invest heavily in its military
because it lives under the powerful military umbrella of the United
States. Israel is a high taxation state, but taxes would soar through
the roof if the United States did not heavily subsidize military
protection of Israel.
"Tax planning for parents of college students: Help clients
form a strategy from the Code's array of options,"
by Joseph D. Beams andJohn W. Briggs," Journal of Accountancy,
March 2012 ---
http://www.journalofaccountancy.com/Issues/2012/Mar/20114558.htm
As parents plan for their children’s higher education, they may
choose from an array of tax-favored savings vehicles and deductions
and credits. Options include education savings plans, education
credits, deduction of educational expenses, education savings bonds,
education loans and other alternatives. No single option works best
for everyone, but by reviewing the pros and cons of each
alternative, families can choose a strategy that best meets their
needs.
Since planning for college education should start when children are
young, CPA tax practitioners should offer these services to new
parents as well as those with children currently in college. Yearly
tax organizers should include questions about tax planning for
college. When conducting yearend tax planning for parents of college
students, CPAs should discuss related issues, including the
dependency exemption on parents’ returns during their children’s
college years.
As the need for a college degree has
increased, the cost of going to college has also increased.
According to The College Board, for the 2011–2012 academic year, the
average annual in-state tuition and fees at a public four-year
college are $8,244, and the average total out-of-state tuition and
fees are $20,770. The average annual tuition and fees at private
nonprofit colleges are $28,500 (tinyurl.com/45joe2).
These costs do not include room and board,
books or supplies. According to The Project on
Student Debt, the average college senior graduating in 2010 owed
$25,250 in student loans (tinyurl.com/4yv5t7z).
Families therefore have good reason to start
saving toward these costs while their children are young. Savings
vehicles include Sec. 529 plans, education savings bonds and
Coverdell education savings accounts (Coverdell ESAs). All of these
plans have their merits. (See the SEC’s overview of Sec. 529 plans
at
tinyurl.com/d8ojwwg.) Families without
savings can still take advantage of the following tax incentives
once their children are in college.
Continued in article
Bob Jensen's taxation helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Tax Decision Case
From The Wall Street Journal Accounting Weekly Review on January
20, 2012
Most ETFs Are Tax-Smart. But Others...
by: Ari I. Weinberg
Jan 09, 2012
Click here to view the full article on WSJ.com
TOPICS: Capital Gains, Taxation
SUMMARY: The article describes an ETF's structure,
how investor transactions affect taxation of other invested
individuals, and how ETF managers can vary behaviors to be more or
less tax efficient in their operations. It is part of the WSJ's
"Investing in Funds: A Quarterly Analysis, January 2012."
CLASSROOM APPLICATION: The article is useful in
classes covering personal taxation or financial planning.
QUESTIONS:
1. (Introductory) What is the difference between a mutual
fund and an exchange traded fund (ETF)? In your answer, include a
definition of each of these types of funds then make the comparison
between the two.
2. (Introductory) How do changes in funds' investment
portfolios result in taxable gains to investors?
3. (Advanced) How can investor requests for redemptions
result in taxable gains (or deductible losses) for all investors in
that mutual fund? How does the difference identified in answer to
question 1 above mean that ETFs can avoid generating these tax
implications for investors?
4. (Advanced) In what ways are some ETFs less tax efficient
than other ETFs? How could you determine an ETF's history in this
matter?
5. (Advanced) Overall, why does an investor care about
taxable distributions from an investment before selling that
investment himself or herself?
6. (Advanced) What is the purpose of Forms K-1 and 1099?
What is the difference between the two forms? Which of these forms
does the article's author believe a taxpayer/investor would prefer
to receive from an ETF?
Reviewed By: Judy Beckman, University of Rhode Island
"Most ETFs Are Tax-Smart. But Others... ," by: Ari I. Weinberg,
The Wall Street Journal, January 9, 2012 ---
http://online.wsj.com/article/SB10001424052970203893404577098661198194858.html?mod=djem_jiewr_AC_domainid
Exchange-traded funds are hardly the magic
models of tax efficiency that some advisers or fund sponsors would
like investors to believe. But generally, they are at least as good
at minimizing tax pain for stock investors as index funds, the most
tax-efficient type of mutual fund.
Here's a closer look at the tax advantages
of ETFs and the limits of those benefits, particularly when
investing in assets other than stocks. How does ETF structure affect
taxes?
The vast majority of ETFs are regulated as
traditional mutual funds under the Investment Company Act of 1940,
and most are similar to conventional index funds in that they buy
and hold the components of a market benchmark. The difference is
that unlike their mutual-fund cousins, ETFs trade like stocks. As
long as the indexes they are tracking don't see big changes in their
components, ETFs, like index funds, rarely have to make portfolio
changes.
Avoiding such changes helps limit realized
capital gains that might have to be distributed to investors.
But there is a significant difference in
how ETFs operate compared with mutual funds that also helps with tax
efficiency. When a traditional mutual fund receives cash from
investors, it issues fund shares and buys a representative set of
its portfolio investments. When investors redeem, the fund delivers
cash and may have to sell underlying investments, which can result
in capital gains that are subject to tax. [NEEDillonline] David
Plunkert
With ETFs, ordinary investors buy and sell
ETF shares from other investors, not from the fund itself.
Meanwhile, ETF shares are created and redeemed in so-called in-kind
transactions with big institutional investors: To receive ETF
shares, market makers, known as authorized participants, deliver the
underlying securities (or a representative basket) to the fund
manager. And when they redeem ETF shares, they are handed securities
rather than cash, which often eliminates the need for the fund to
take gains. What's the impact of ordinary investors' buying shares
from each other?
With this design, buying and selling by one
investor doesn't result in tax consequences for the rest of the fund
because the ETF doesn't have to sell securities to pay off departing
investors. ETFs allow investors to be "isolated from the actions of
other investors," says Ryan Issakainen, ETF strategist for ETF
sponsor First Trust Advisors LP. And, because the cost of trading is
borne by the individual investor, securities-transaction costs for
the fund itself are low. How do in-kind transactions affect a fund's
tax efficiency?
They allow ETF managers to make tax-wise
decisions about which securities to distribute and whether to sell
securities or distribute them in-kind.
In industry parlance, ETFs can internalize
losses and externalize gains. That is, when an index change requires
an ETF to get rid of a stock that has fallen in price since
purchase, the fund can make the sale on the open market, collect the
cash and take the capital loss on its books. If the fund is looking
at a winning trade, the bias is to pass that stock out in an in-kind
redemption—taking its low cost basis out with it, as well as any
potential capital-gains tax bill.
Continued in article
In spite of the media hype about 9-9-9, I think it's safe to assume
there won't be serious tax reform in the near future.
If tax reform swaggered into a Luckenbach, Texas saloon, it would be "all
hat and no horse"
The ladies of the night would die laughing at that "itty-bitty thang" that
walked in
And it would need a ladder to peek over the top of the spittoon
My point is that you probably should plan your financial future on
the present mess we call the Tax Code. In this regard, you might like to
learn about one of the best helper sites around.
Tax Helpers
October 22, 2011 message from Scott Bonacker (himself a professional CPA
tax expert)
It is hard to prioritize the things that
are important to tax preparers, not the least of which are these:
keeping up with current developments and improving understanding of
the principles of taxation. Single sourcing is one way we do it,
and for that reason the commercial tax services provide
extensive editorial content and regular newsletters and updates.
There is also a considerable amount of information and thought that
is available for free on the internet if you know where to find it.
So much, that it is difficult sometimes to filter the choices to the
ones that can make a valuable contribution.
Email study groups are one way, and blogs are another. One of those
is the 21st Century Taxation blog by Professor Nellen.
Professor Nellen is a tax professor and director of the MS Taxation
Program at San Jose State University, and her blog is frequently
updated with intelligent commentary and links to resources.
Her experience as a teacher shows as Professor Nellen will often
point out an event or an article or a circumstance and then describe
how she sees it in relation to current events or professional
practice. Her blog posts provide analysis and links to allow the
reader to look into things in more
depth, and many times they close with a question - "What do you think?"
A prolific writer, Professor Nellen maintains a personal website -
http://www.21stcenturytaxation.com/
Professor Nellen's academic page at San Jose
State University -
http://www.cob.sjsu.edu/nellen_a/
is also a large repository of useful information.
Since most of us are in the business of tax planning and preparation
we also become involved in explaining and discussing relative
advantages and disadvantages of the options that are available now.
Then there is also the potential for future alternatives. Professor
Nellen's collection of articles and analysis of tax reform
information can be a very important addition to the resources
available to a tax professional.
I saw an email tagline that said something about experts knowing
where to find answers. First you have to recognize that there may be
an issue. What
are your sources of information?
Scott Bonacker CPA
Springfield, MO
IRS Telephone Tax Map
March 12, 2010 message from Scott Bonacker
[lister@BONACKERS.COM]
http://taxmap.ntis.gov/taxmap/
About IRS Tax Map
IRS Tax Map began in 2002 as a prototype to address the business
need for improved access to tax law technical information by our
telephone assistors. Tax Map is built on two technologies: semantic
integration and the Topic Maps international standard (ISO/IEC
13250).
Background
IRS began implementing standard markup languages and creating
structured content for our tax law information in the late 1980s.
XML/SGML has allowed IRS to standardize document syntax and
structure but additional standards were needed to integrate our
information sources. IRS chose the Topic Maps international standard
for IRS Tax Map.
IRS Tax Map
IRS Tax Map is a web presentation of an underlying "topic map",
best understood as a kind of subject-oriented database — a database
designed to organize information around subjects of interest to
taxpayers. Each subject has a "topic page" in Tax Map. This page
provides central access to everything that Tax Map knows about the
subject. It may have links to the topic pages of related topics, as
well as to relevant forms, instructions, and publications.
The Tax Map production process adapts to the different kinds of
information produced by the various groups at IRS, and incorporates
input and feedback from IRS Tax Specialists and Tax Map users.
Adherence to the principles of the ISO Topic Maps standard protects
the value of this knowledge, allowing it to be exploited and
maintained under changing conditions.
For more information on the Topic Maps international standard see
Cover Pages hosted by OASIS and the
ISO working group maintaining the standard. For additional
information or comments on IRS Tax Map email us at:
topicmap@irs.gov
Bob Jensen's taxation helpers are at
http://faculty.trinity.edu/rjensen/bookbob1.htm#010304Taxation
Where do you find help with taxes?
Start with the IRS links shown above. These services are free from the
IRS.
Especially note the IRS Taxpayer Advocate Service ---
http://www.irs.gov/advocate/index.html
Taxpayer Advocate Service. ---
http://www.irs.gov/advocate/index.html
IRS Site Map ---
http://www.irs.gov/sitemap/index.html
IRS Telephone Tax Map ---
http://taxmap.ntis.gov/taxmap/
TaxSites.com (links to tax news sites) ---
http://www.taxsites.com/help.html
Check with you local or state Society of CPAs. These societies often
provide links to free local taxpayer assistance helpers.
Links for U.S. states and territories can be found at
http://www.aicpa.org/Legislative+Activities+and+State+Licensing+Issues/State+News+and+Info/States/info/index.htm
or just
Click Here
There are thousands of commercial taxpayer assistance companies,
attorneys, and accountants that charge fees and deal with varying levels of
tax problem complexities. Be sure to investigate the credentials and
reputations of these service providers. There are many fraudulent taxpayer
serivice firms ---
http://faculty.trinity.edu/rjensen/FraudReporting.htm#TaxScams
Unless the provider has an established reputation, don't deal over the phone
or the Internet. A local provider should have an office and an address other
than a postal box. Taxpayer assistance is an area where you may not get what
you pay for.
There are some helpers for obtaining professional services at
http://faculty.trinity.edu/rjensen/fees.htm
A U.S. Treasury Department site where tax professionals go for news
and updates ---
http://www.treasury.gov/topics/taxes/
Custom Google searches of tax sites ---
http://www.taxsites.com/
Will Yancey earned an accountancy PhD at the University of Texas and then
served on the faculty at TCU for six years as a tax professor. While at TCU
I was impressed by his early-on Web site of taxation helpers. His Web site
was recognized in The CPA Journal, Technology Section, "Website
of the Month:
WillYancey.com", December 2004, page 60. Will Yancey no longer maintains
the detailed taxation part of his Web site but links to a
tremendous taxation helper site started by an
avid hunter and professor at the University of Northern Iowa,
Dennis Schmidt,
that was later sold for big bucks to a commercial outfit ---
http://www.taxsites.com/help.html
A Special Tribute to My Open Sharing Friend Will Yancey ---
http://faculty.trinity.edu/rjensen/Yancey.htm
"2012 tax software survey: Which products and features yielded
frustration or bliss?" by Paul Bonner, Journal of Accountancy,
September 2012 ---
http://www.journalofaccountancy.com/Issues/2012/Sep/20125667.htm
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
AccountingWeb's 2009 Tax Software Review for Professionals, November 2009
Featured Tax
Software
Bob Jensen's accounting software helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
Accounting and Tax News ---
http://faculty.trinity.edu/rjensen/AccountingNews.htm
Tax Foundation Facts & Figures (Free) ---
http://taxfoundation.org/files/ff2012.pdf
TickMarks (tax blog) ---
http://tickmarks.blogspot.com/
"Unemployment taxes may double or even triple in 2010,"
AccountingWeb, December 17, 2009 ---
http://www.accountingweb.com/topic/tax/unemployment-taxes-may-double-or-even-triple-2010
Case Studies in
Gaming the Income Tax Laws
http://www.cs.trinity.edu/~rjensen/temp/TaxNoTax.htm
Effective Tax Rates Are Lower Than Most People Believe
"Measuring Effective Tax Rates," by Rachel Johnson Joseph Rosenberg Roberton
Williams, Urban-Brookings Tax Policy Center, February 7, 2012 ---
http://www.taxpolicycenter.org/UploadedPDF/412497-ETR.pdf
The American Dream ---
http://www.cs.trinity.edu/~rjensen/temp/SunsetHillHouse/SunsetHillHouse.htm
American Dream ---
http://en.wikipedia.org/wiki/American_Dream
Often the goal of an American Dream is not so much betterment of your own
life but betterment of the lives of your children and grandchildren.
The Hendersons featured in this article have two of their own girls plus a
girl and boy that they adopted in China.
Could it be that tax revisionists in Denmark are beginning
to anticipate (by reducing tax rates)
value added from something like an American Dream being introduced in
Denmark?
Does the American Dream add more good than harm?
A Message from Jim Peters on the AECM
A couple of years ago, 60 minutes interview a
bunch of Danish citizens because the Danes had once again topped the
international surveys as the happiest people on earth. Americans, as
with most international measures, were somewhere in the middle of the
pack. The Dane's advice to Americans was to dump the American Dream
because it caused more harm than good. The core of the American
Dream seems to be equating wealth to happiness and setting off on a
constant quest for more wealth. The Danes advice was to focus more on
non-economic sources of happiness and learn to appreciate what you have.
Obviously, all this is an anathema to Americans
and some of the reaction to the Dane's comments included epithets like
"losers" and "hippies." But, the fact is that they are happier than
Americans.
Jim
Jensen Comment
I take issue with Jim's quoted phrase that the American Dream
in America "caused more harm than good." In my
opinion, most of what we have that is good in America was built in one way
or another on somebody's American Dream, a somebody willing to take
financial and even physical risks, work tirelessly to build or rebuild
something (possibly making creative innovations along the way), and pass the
fruits of entrepreneurial labor on so that other Americans can find jobs and
other Americans can enjoy the goods and services provided by the American
Dreams of others.
Continued with pictures at
http://www.cs.trinity.edu/~rjensen/temp/SunsetHillHouse/SunsetHillHouse.htm
Investment Clubs, Hedge Funds, and Tax Implications
Investment clubs commenced with friends in communities and/or work places
that sometimes made social events out of studying investments and pooling small
amounts of money in a fund that in turn was managed by the group as a whole ---
http://en.wikipedia.org/w/index.php?title=Special%3ASearch&redirs=0&search=Investment+club&fulltext=Search&ns0=1
I also think of an hedge fund as a much larger investment club where a
professional investor generally manages the investments for a group of
individuals who join that index fund. Hedge funds, like lower end investment
clubs, do not sell shares in the club to the public in general. An advantage and
a disadvantage of not going public is that such funds, until recently, are not
subject to state and Federal securities laws and SEC oversight, although since
the adverse publicity (read that Madoff Hedge Fund) of the failed attempts are
being made by lawmakers to rein in on hedge funds ---
http://en.wikipedia.org/wiki/Hedge_fund
The Madoff Hedge Fund turned out to be the largest Ponzi Scheme in the World
(aside from the Social Security Fund of the U.S. which is a Ponzi scheme not yet
shut down).
Investment Club Software ---
http://en.wikipedia.org/wiki/Investment_club_software
An Investment Club Helper Site ---
http://investmentclubsonline.com/result.php?Keywords=Investment%20Clubs
Note that investment clubs should understand state and local tax laws regarding
investment club returns and liquidations.
IRS Publication 550 (2008), Investment Income and Expenses
http://www.irs.gov/publications/p550/index.html
Abusive Tax Scheme Investigations - Fiscal Year 2009 ---
http://www.irs.gov/compliance/enforcement/article/0,,id=187267,00.html
Bob Jensen's investment helpers are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#WebsitesForInvestors
When the homeowner mortgage deduction hurts versus helps a local real estate
market
"Study finds key tax break has adverse effect on homeownership, social
welfare," by Greg Tammen, PhysOrg, March 30, 2011 ---
http://www.physorg.com/news/2011-03-key-tax-adverse-effect-homeownership.html
The American dream of owning a home with a white
picket fence may stay a dream for many, according to a recent study by a
Kansas State University economist.
Tracy Turner, associate professor of economics at
K-State, and Christian Hilber, a professor at the London School of Economics
in the United Kingdom, completed a study on America's mortgage interest
deduction and how effectively it promotes homeownership.
The mortgage interest deduction, also called the
MID, is the second largest tax break in the federal tax code and is meant to
promote homeownership by allowing itemizing homeowners to deduct the annual
interest payments they make on their primary residence and second home real
estate loans. For the 2011 fiscal year, the deduction will account for an
estimated $104.5 billion in revenue loss for the U.S. Treasury.
However, since the Reagan administration, the
deduction has been viewed as a vehicle for promoting homeownership, Turner
said.
"In urban places suffering from neighborhood
instability, underperforming schools, low social capital and poor
governance, increasing homeownership rates may improve conditions in these
communities. This is because when households own their housing, they have
more of a stake in the success of their communities," Turner said. "But in
these urban places the MID is doing the opposite; it's actually lowering the
likelihood of owning a home."
The duo's study analyzed household data collected
from 1984-2007 by the Panel Study of Income Dynamics.
Findings showed that the mortgage interest
deduction boosts homeownership rates only in areas with an abundant housing
supply, like the Midwest -- but only for higher-income households. In denser
urban cities with limited housing available, the deduction actually has a
negative impact, reducing homeownership and instead inflating housing
prices.
According to Turner, the finding is consistent with
economic theory: tight land restrictions mean that the higher demand for
owner-occupied housing – because of increases in the mortgage interest
deduction -- will only bid up house prices without expanding the house
stock, which in turn means higher down payments.
Consequently, though households may be able to make
monthly payments, low-wealth households can't afford the elevated down
payment. These high house prices, and therefore higher transaction costs,
also make homeownership a less attractive option to mobile households that
may not be looking for a long-term purchase.
Continued in article
Jensen Comment
Clearly the mortgage deduction issue gets confounded by other factors affecting
the motivation to buy a home in a given neighborhood. In a great location with
good schools, scenic views, ease of commuting, etc. one's investment in a home
is more apt to make a capital gain as well as provide fine living while owning
the home. In a rundown neighborhood with crime problems, poor schools, etc. an
investment in a home is more apt result in a capital loss. Why buy a home in a
neighborhood that you're trying to escape from as soon as you can afford better
and/or as soon as you have school-age children?
Hence the mortgage deduction motivation may not be as important as other
factors driving incentives to own rather than rent.
"What Can Taxpayers Do If They Can't Pay Their Taxes?" SmartPros,
April 6, 2009 ---
http://accounting.smartpros.com/x66196.xml
Are there options for Americans who cannot pay
their taxes, due to their financial difficulties resulting from the down
economy?
According to Jim Keller, of Thomson Reuters, more
taxpayers will face this challenge during the coming filing season.
Taxpayers who fail to timely file and pay their taxes face penalties and
interest charges. Not only that, says Keller, these folks can expect to come
up against a more aggressive IRS. For example, the number of levies issued
by the IRS increased by 1,608% from 2000 to 2007—from 220,000 levies to more
than 3.75 million levies. A new factor that will play into taxpayer
collections is that the IRS (as noted by IRS Commissioner Doug Shulman in a
recent press release) has decided not to renew contracts with two private
debt collection agencies but instead anticipates hiring more than 1,000 new
collection personnel as IRS employees in fiscal year 2009.
Fortunately, there are some options available to
help taxpayers pay their balance due. Here’s a scenario of problem solving
from Thomson Reuters:
Let’s assume that Bob and Judy’s 2008 tax return
shows unpaid tax of $5,000, but they don’t have the cash to pay the tax.
First, they should not ignore the IRS—it will not go away. They should
either file their return by the April 15 due date, or request a filing
extension. Either way, the failure to pay the taxes due on April 15 will
result in interest charges and a penalty for failure to pay of ½% per month
on the unpaid balance (up to 25%) until the taxes are paid. But by filing or
extending their return, they’ll avoid the more onerous late filing penalty
of 5% per month on the unpaid balance (up to 25%) until the return is filed.
If Bob and Judy don’t do anything by April 15th,
but file the return and pay their taxes three months later, they’ll owe a
failure to file penalty of $750. If they extend the return and then file it
and pay their taxes three months later, they’d pay a failure to pay penalty
of $75— $675 less than if no extension had been filed. “This shows how
important it is to file or extend by April 15th even if you don’t have the
money,” says Keller.
Keller points out that getting an extension is
pretty easy these days. Taxpayers no longer have to pay the balance due or
sign the extension request for a valid six-month filing extension. However,
the liability must be properly estimated and the amount due entered on the
appropriate lines of the request, or the extension will be disallowed.
“While doing so will avoid a failure to file penalty, interest and the
failure to pay penalty will accrue from April 15 until the tax is paid,” he
warns.
Some taxpayers can qualify for an extension to pay
the tax because of undue hardship, or because of a federally declared
disaster, terrorist act, or military action. This type of approach would
allow Bob and Judy to avoid the failure to pay penalty but not the interest
charge. “However, hardship relief is difficult to obtain,” says Keller,
“because of the restricted definition of hardship, and most taxpayers do not
experience a federally declared disaster, like a hurricane or flood.”
Financing the Payment
Borrow from a bank or family. “Since the failure to
pay penalty and interest applies to the late payment of tax, borrowing from
a family member, bank, or other lender can be less expensive than paying
penalties and interest to the IRS,” says Keller, pointing out that the IRS
interest rate changes quarterly. For the first quarter of 2009, the
underpayment rate is 5%. Tax penalties are nondeductible, and interest
expense associated with an individual’s federal tax liability, whether paid
to the IRS or to a commercial lender, generally is nondeductible personal
interest.
Home equity loan. If Bob and Judy can finance the
tax payment with a home equity loan, the interest may be deductible for
regular tax (but not AMT) purposes. A home equity loan is debt (other than
acquisition debt) secured by a qualified residence. It generates deductible
interest to the extent the loan doesn’t exceed the lesser of $100,000
($50,000 for married filing separately), or the FMV of the residence less
acquisition debt. There’s no limit on the number of qualified home equity
loans a taxpayer can take out (as long as the loans collectively meet the
$100,000/$50,000 or FMV limitation) and use of the debt proceeds is
irrelevant unless they’re used to purchase or carry tax-exempt obligations.
Credit card. Another option is paying the tax by
credit card. Applicable finance charges (according to the credit card
agreement) and processing fees will apply, but if Bob or Judy has a low
interest rate card, these will be kept to a minimum until the balance is
paid in full. While the interest on the credit card is nondeductible
personal interest, some credit cards provide low rates, airline miles, or
other incentives. For more information, go to the front page of www.irs.gov
and type “paying tax by credit card” in the Search box.
Request an Installment Agreement with the IRS. A
final option is to request an installment arrangement from the IRS. Form
9465 is the application to the IRS requesting an installment payment
arrangement. Once submitted, the IRS will notify the taxpayer within 30 days
if the request is approved or denied, or if additional information is
needed. The IRS would charge Bob and Judy a $105 fee for entering into the
agreement, but that fee would be reduced to $52 if the direct debit option
is selected, and can be reduced to $43 for certain low-income taxpayers.
Under current administrative procedures, the IRS
will approve installment agreements up to $25,000 (including tax, penalties,
and interest) when the taxpayer agrees to pay the amount due in five years
or less. Also, since Bob and Judy owe $25,000 or less, they can use the
online payment agreement (OPA) application at www.irs.gov to request a
payment agreement. This application is available to taxpayers who meet the
$25,000 requirement, have filed all required tax returns, and are current
with their tax payments. The OPA application would enable Bob and Judy to
obtain a short-term extension of up to 120 days to pay, or request a longer
monthly payment plan.
Says Keller: The bottom line is that if you can’t
pay taxes you owe on April 15, either file your return or file for an
extension, and pay as much as you can to avoid penalties and interest. You
can then work on a solution to pay the unpaid balance. “Never ignore the
filing deadline,” says Keller.
"Obama Plans ‘MyRA’ Retirement Savings Accounts" retirement accounts
work," by Michael Cohn, Accounting Today, January 29, 2014
http://www.accountingtoday.com/ad_includes/welcome.html
President Obama
introduced a new retirement savings vehicle that he called a “MyRA” in his State
of the Union address on Tuesday evening, and the White House has followed up
with more details on Wednesday about it.
“Let's do more to help
Americans save for retirement,” said Obama (see Obama Calls for Wage Increases
and Tax Reforms in State of the Union). “Today, most workers don't have a
pension. A Social Security check often isn't enough on its own. And while the
stock market has doubled over the last five years, that doesn't help folks who
don't have 401(k)s. That’s why, tomorrow, I will direct the Treasury to create a
new way for working Americans to start their own retirement savings: MyRA. It's
a new savings bond that encourages folks to build a nest egg. MyRA guarantees a
decent return with no risk of losing what you put in."
The White House press
secretary's office said in a fact sheet it released Wednesday that MyRA would
provide a new simple, safe and affordable “starter” retirement savings account
that will be offered through employers to help Americans begin to save for
retirement.
The new product will be
targeted to the many Americans who currently lack access to workplace retirement
savings plans, which is usually the most effective way to save for retirement,
the White House noted. It wsa created by executive action Wednesday, bypassing
Congress.
Unlike a 401(k), however,
MyRA will offer “principal protection” so a saver’s account balance “will never
go down,” the White House said. “The product will be offered via a familiar Roth
IRA account, and savers will benefit from principal protection, so the account
balance will never go down in value. The security in the account, like all
savings bonds, will be backed by the U.S. government. Contributions can be
withdrawn tax free at any time.”
To make MyRA a more
user-friendly, “portable” account, contributions will be voluntary, automatic
and small. Initial investments could be as low as $25 and contributions that are
as low as $5 could be made through automatic payroll deductions. “Savers have
the option of keeping the same account when they change jobs and can roll the
balance into a private-sector retirement account at any time,” said the White
House.
In addition, MyRA is
expected to provide the same secure investment return currently available to
federal employees. Savers will earn interest at the same variable interest rate
as the federal employees’ Thrift Savings Plan Government Securities Investment
Fund.
MyRA is expected to be
widely available to millions of lower- and middle-income Americans through their
employers. It will be available to households earning up to $191,000 a year. The
accounts will be offered through an initial pilot program to employees of
employers who choose to participate by the end of 2014. “The accounts are little
to no cost and easy for employers to use, since employers will neither
administer the accounts nor contribute to them,” said the White House.
“Participants could save up to $15,000, or for a maximum of 30 years, in their
accounts before transferring their balance to a private sector Roth IRA.”
New York CPA Reactions A
group of New York State Society of CPAs members offered various reactions to the
President’s MyRA proposal.
“The concept sounds great
and it has the potential to build a foundation for people to begin saving for
their retirement,” said David Young, CPA, a member of the NYSSCPA’s Rochester
Chapter. “The challenge could be in the implementation for the employers and
employees. The cost of the implementation and administration may outweigh the
benefit gained from the ‘My RA’ program.”
Another NYSSCPA member,
Catherine Censullo, a CPA and personal financial specialist from White Plains,
N.Y., said she was concerned about the rate of return. “The bonds will have very
small returns, which are not good for keeping up with inflation over the long
term growth, but participants will not have to worry about losing their money
invested,” she said.
“My other concern is that
it will be too easy to take the money back out, which may defeat the purpose of
putting money away and not touching it before retirement,” Censullo added. ”What
remains to be seen is how the plans will be structured and what the incentive
will be for employers to participate in the plan.”
Another certified
financial advisor shared his concerns. “President Obama's "MyRA" is another
simple-minded response to a serious problem afflicting our nation's citizenry,”
said Daniel G. Mazzola, a certified financial analyst and CPA from Long Island,
N.Y. “Is it appropriate to encourage people to invest in long-term Treasury
bonds in a climate of historically low interest rates? Will the money deducted
be placed in a separate account for each individual or a general trust fund like
the Social Security Trust Fund with which the government has access and can use
for general expenditures?”
“Is the President unaware
that it is relatively easy for a private sector worker to establish an IRA at a
local bank or brokerage house?" Mazzola added. “Making it easier for people to
set aside money for retirement is a small measure when compared to providing an
overall environment in which they have an opportunity to be successful.”
Auto-IRA Despite
President Obama’s recent emphasis on issuing executive orders as a way to get
around a gridlocked Congress, the White House said the administration would
continue to work with Congress on the President’s existing proposals to make
sure that all Americans can secure a dignified retirement. “While Social
Security is and must remain a rock-solid, guaranteed progressive benefit that
every American can rely on, the most secure retirement requires a three-legged
stool that includes savings and pensions,” said the fact sheet. “That’s why the
President is using his executive authority to create the ‘myRA’ and has already
proposed to work with Congress on the following proposals to help Americans save
for their retirement.”
Those proposals, which
depend on passage in Congress, include giving every employee access to easy,
payroll-based savings through the “Auto-IRA.” Approximately half of all American
workers do not have access to employer-sponsored retirement plans like 401(k)s,
which puts the onus on individuals to set up and invest in an Individual
Retirement Account, the White House noted. Up to 9 out of 10 workers
automatically enrolled in a 401(k) plan through their employer make
contributions, even years later, while fewer than 1 out of 10 workers eligible
to contribute to an IRA voluntarily do so. The President’s budget will propose
to establish automatic enrollment in IRAs (or “auto-IRAs”) for employees without
access to a workplace savings plan, in keeping with a plan that he has proposed
in every budget since he took office. Employers that do not provide any
employer-sponsored savings plan would be required to connect their employees
with a payroll deduction IRA. This proposal could provide access to one-quarter
of all workers, according to a recent study.
Workers would not be
required to contribute to an Auto-IRA and are free to opt out. Employers would
also not contribute. The plan would also help defray the minimal administrative
costs of establishing auto-IRAs for small businesses, including through tax
incentives, the White House pointed out.
Continued in article
Bob Jensen's personal finance helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Teaching Case on Roth IRAs
From The Wall Street Journal Accounting Weekly Review
The Roth-IRA Math for 50-Somethings
by: Walter Updegrave
Sep 27, 2014
Click here to view the full article on WSJ.com
TOPICS: Individual
Taxation, Roth IRA, Tax Planning
SUMMARY: Roth IRAs
have long appealed to investors in the early stages of their careers who
expect to pay taxes at a higher rate in retirement. Research released
recently by T. Rowe Price Group indicates that investors in their 50s and
early 60s who pay taxes at a lower rate in retirement can fare better in a
Roth, as well.
CLASSROOM APPLICATION: The
explanation in this article is appropriate for coverage of IRAs in an
individual taxation course.
QUESTIONS:
1. (Introductory) What is a Roth IRA? How does it differ from other
IRAs?
2. (Advanced) What are the advantages of Roth IRAs? With what group
of people are Roths popular? Why?
3. (Advanced) Who does the research suggest should consider
contributing to a Roth? Why? People in what situations should make other
choices? Please explain the reasons for your answer.
4. (Advanced) What are the requirements for contributing to an IRA?
Are you able to contribute to a Roth now? What are the advantages of
contributing to a Roth IRA while you are young? After reading this article,
will you be investing in a Roth IRA? Why or why not? What other investment
options do you have?
Reviewed By: Linda Christiansen, Indiana University Southeast
"The Roth-IRA Math for
50-Somethings," by Walter Updegrave, The Wall Street Journal, September
27, 2014 ---
http://online.wsj.com/articles/the-roth-ira-math-for-50-somethings-1411753083?mod=djem_jiewr_AC_domainid
Roth IRAs have long appealed to investors in the early stages
of their careers who expect to pay taxes at a higher rate in retirement.
Older investors may also be tempted to use Roths to generate
more retirement income than they could with a traditional individual
retirement account or 401(k), even if they expect to pay taxes at a lower
rate down the road.
The strategy may work in some circumstances, but the
advantage for those investors of saving with a Roth could be relatively
small—and is no sure thing.
Roths are essentially mirror versions of traditional IRAs and
401(k)s; each is designed to build retirement assets over time by putting
money into stocks, bonds and other investments. With a traditional IRA or
401(k), you get a tax deduction upfront or invest pretax dollars. When you
withdraw money later on, you pay taxes on the contribution and any
investment gains.
With a Roth, by contrast, you contribute after-tax dollars,
and you can generally withdraw the contributions and any gains tax-free in
retirement. Investors who expect their marginal tax rate to be higher in
retirement can benefit, in particular, by in effect avoiding higher taxes in
the future.
Research released recently by T.
Rowe Price Group, TROW +0.33% a
major fund manager based in Baltimore, indicates that investors in their 50s
and early 60s who pay taxes at a lower rate in retirement can fare better in
a Roth, as well.
Consider a hypothetical 55-year-old
investor plugged into a spreadsheet supplied by T. Rowe Price. The investor
pays taxes at the 28% rate and drops to a 25% rate after retiring at 65. The
investor could end up with 8% more after-tax income during a 30-year
retirement by contributing to a Roth instead of a traditional account.
The advantage is smaller over the shorter
term. If that investor contributes $6,500—the maximum for people 50 and
older—to a Roth IRA and the $6,500 grows at 7% a year, he or she would have
$12,786 after 10 years, which could be withdrawn without paying any tax.
An investor who contributed the same
amount to a traditional IRA—and who invested the tax savings in a separate
taxable account—would end up with $12,566, or $220 less than with the Roth.
Paying taxes on that separate account each year is what gives the Roth its
advantage.
But investors who want to capitalize on
this advantage by choosing a Roth IRA or 401(k) over a traditional account
should be aware of two important caveats.
First, since the advantage is relatively
small, it can take many years for an investment in a Roth to develop a
meaningful edge over a traditional account if an investor will be moving to
a lower tax rate in retirement.
The hypothetical investor achieves the 8%
increase in after-tax income in retirement by keeping the Roth IRA invested
for 40 years, including the 10 years before retirement at 65 and the 30
years during retirement in which the money earns 6% annually and is
gradually withdrawn.
"I don't think you want to be banking on
strategies that may require extreme time horizons for you to come out
materially ahead," says Michael Kitces, director of planning research at
Pinnacle Advisory Group in Columbia, Md.
The second caveat is that an investor who
expects to drop to a lower tax rate would need to contribute the maximum
allowable amount to a Roth to take full advantage of the boost a Roth can
provide.
For example, if the hypothetical
55-year-old investor put just $4,000 into a Roth IRA, instead of the maximum
$6,500, the investor would end up with 4% less after-tax income over a
30-year retirement than with a traditional account. The investor would have
done better putting the equivalent amount of pretax dollars—$5,556, assuming
a 28% tax rate—in a traditional account.
The Roth might still be a worthwhile
choice for such an investor. For example, an investor in a Roth IRA wouldn't
have to take minimum distributions after age 70½ and pay tax on them, as the
investor would with a traditional IRA.
Continued in article
"2010: The Year of the Roth Conversion?" by Rich Arzaga, Journal of
Accountancy, January 2010 ---
http://www.journalofaccountancy.com/Issues/2010/Jan/20091743.htm
This year
will be the Year of the Tiger, according to Chinese custom, but it also
could be remembered by investors as the Year of the Roth Conversion, a
decision that can have a large impact on investors’ ability to build wealth
during their lifetime and preserve wealth for beneficiaries.
Prior to
2010, anyone (except married taxpayers filing separately) with an annual
adjusted gross income (AGI) of no greater than $100,000 could convert a
traditional IRA to a Roth IRA. The AGI cap has prevented higher-income
earners, a class of savers that might have benefited most from this
strategy, from participating. However, under the Tax Increase Prevention and
Reconciliation Act of 2005 (TIPRA) these previously ineligible taxpayers
will be eligible to participate starting this year (including married but
separate filers). In fact, there is an incentive to take action in 2010:
Everyone who converts this year may defer and spread income recognition from
the conversion over tax years 2011 and 2012. A conversion in 2010 thus could
reduce the marginal tax rate and total taxes due on what otherwise would be
a larger single-year distribution. The 10% penalty tax otherwise imposed on
early or excess distributions from an IRA does not apply. A conversion could
be an attractive retirement income and estate planning strategy for wealthy
individuals and high-income earners who seek to reduce taxes later in life
and transfer more wealth to beneficiaries tax-free. But like any other
approach to income and taxes, this decision is eventually based on a set of
sustainable assumptions and specific objectives of the taxpayer.
ADVANTAGES OF A ROTH ACCOUNT
A chief
advantage of a Roth IRA is that it has more flexible rules concerning
distributions. Also, taxpayers who are otherwise unable to contribute to a
traditional IRA can take advantage of a Roth IRA’s appreciation free from
tax on gains. Other advantages of a Roth IRA include:
-
In
most instances, contributions can be withdrawn at any time without
penalty. Earnings may be withdrawn without tax or penalty if the
taxpayer is at least age 59½ and has held the Roth account for at
least five years. Similar strategies that provide for tax-free
growth and withdrawal are the IRC § 529 plans for college education
and cash-value life insurance policies. Each has its strengths and
limitations.
-
With a Roth IRA, there are no required minimum distributions (RMDs)
like those that apply to traditional IRAs when the taxpayer reaches
age 70½. For affluent families with sufficient resources for
retirement income, the RMD can seem an unnecessary expense with a
confusing formula. From a client’s perspective, eliminating RMDs can
provide a great sense of relief from the annual hassle of
calculating and managing these distributions.
-
Unlike with traditional IRA accounts, taxpayers can continue to
contribute to a Roth IRA after reaching age 70½—also an attractive
feature as Americans redefine retirement and continue to be
industrious into later years. Starting in 2010, a retired couple can
contribute $12,000 each year (including the “over- 50 make-up”
amount) into Roth accounts. The AGI limits on regular contributions
to a Roth IRA still apply, but it is possible to make nondeductible
contributions to a traditional IRA and convert them to a Roth,
regardless of AGI. These contributions grow free of income tax
indefinitely, creating significant value for taxpayers as well as
their beneficiaries.
-
A
tax-diversified retirement distribution strategy also helps with
Social Security planning. Up to 85% of Social Security benefits are
taxable. When calculating modified adjusted gross income (MAGI) for
Social Security purposes, taxpayers must include all taxable and
tax-exempt income and 50% of their Social Security benefits, but not
Roth IRA distributions. Having a Roth IRA to supplement retirement
income can be very important in managing the taxability of Social
Security benefits.
IDEAL CONVERSION CANDIDATES
Some
taxpayers may benefit more than others from converting to a Roth IRA.
Assuming there are no cash flow issues, risk management gaps, other tax
planning considerations that need to be weighed against the benefit of a
conversion, advance tax issues at play, or adverse legislative changes,
taxpayers who stand to benefit the most are those who:
-
Are
wealthy.
-
Seek to reduce estate settlement costs.
-
Won’t need to draw income from converted retirement accounts.
-
Are
young, high-income earners.
-
Believe their tax bracket will be the same or higher in retirement,
or more specifically, when they draw income from their qualified
retirement accounts. The attractiveness of traditional IRAs and
qualified retirement plans depends on the assumption that taxpayers
will have a lower effective tax rate after retirement, when the
deferred taxes on the savings will come due. Conversely, taxpayers
whose tax rate seems more likely to be the same or higher in
retirement might just as soon pay taxes on income now and accumulate
tax-free gains. Consider the conversion comparison in Exhibit 1.
Continued in article
Bob Jensen's taxation helpers are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#010304Taxation
Question
Where can you find facts about taxation?
October 7, 2007 message from JOHN STANCIL
[jstancil@VERIZON.NET]
I realize that the IRS is pretty tight with
its data, even in aggregated form. However, does anyone know if
there is an internet source where you can obtain certain tax facts –
such as the amount of charitable contributions claimed on individual
returns, the dollar amount of earned income credit, the amount of
productive activity deductions taken on a year to year basis?
Any help would be appreciated.
John Stancil
Florida Southern College
October 8, 2007 reply from Bob Jensen
When in doubt, always start with Wikipedia ---
http://en.wikipedia.org/wiki/Taxation
It goes without saying that you must be suspicious of questionable
items in any Wikipedia module. However, the above link is quite good
on this topic. As with most Wikipedia modules, both the Reference
(Notes) links and the Discussion sections are very important.
The Notes section (near the bottom) in this case leads to OECD
sites such as the National Accounts site ---
http://www.oecd.org/topicstatsportal/0,2647,en_2825_495684_1_1_1_1_1,00.html
OECD Factblog ---
https://community.oecd.org/community/factblog?view=overview
OECD Factbook eXplorer ---
http://stats.oecd.org/oecdfactbook/
Education Today: The OECD Perspective ---
http://www.oecd.org/document/57/0,3343,en_2649_33723_42440761_1_1_1_1,00.html
The Discussion tab (near the top) leads to an extensive table of
contents of discussions.
Here are a few other sites to check out:
Bob Jensen’s statistical data links ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#EconStatistics
FirstGov ---
http://www.fedworld.gov/firstgov.html
Great IRS site links (not necessarily data table links):
The Individual Complete Report
Publication contains complete individual income tax data.
The statistics are based on a sample of individual income
tax returns, selected before audit, which represents a
population of Forms 1040, 1040A, and 1040EZ, including
electronic returns. ---
Click Here
FAQs and answers ---
http://www.irs.gov/faqs/index.html
Tax Fraud Alerts from the IRS ---
http://www.irs.gov/compliance/enforcement/article/0,,id=121259,00.html
Tax Scams ---
http://faculty.trinity.edu/rjensen/FraudReporting.htm#TaxScams
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Ten Highest and Ten Lowest States in Terms
of Taxpayer Liability
A Lot of Taxpayers in the South Pay Zero Taxes (Non-Payers) Due to
Credits, Deductions, and Poverty
Source: Scott A. Hodge, Tax Foundation, May 24, 2010 ---
http://www.taxfoundation.org/publications/show/26336.html
According to the latest IRS figures for 2008, a record 52 million filers—36
percent of the 143 million who filed a
tax return—had no tax liability because their credits and deductions reduced
their liability to zero.
Indeed, tax credits such as the child tax credit and earned income tax credit
have become so generous
that a family of four earning up to about $52,000 can expect to have their
income tax liability erased entirely.
Controversial Tax Court Decision on Tuition Deductions
How One Woman Went to Tax Court and Won Deduction
January 11, 2010 message from Davidson, Dee (Dawn)
[dgd@MARSHALL.USC.EDU]
Nurse Outduels IRS Over M.B.A. Tuition
How One Woman Went to Tax Court and Won Deduction
http://online.wsj.com/article/SB10001424052748703535104574646582965101664.html?mod=WSJ_latestheadlines
By LAURA SAUNDERS A Maryland nurse accomplished
two rare feats in her battle with the Internal Revenue Service: She
defended herself against the agency's lawyers and won, and she got a
ruling that could help tens of thousands of students deduct the cost of
an M.B.A. degree on their taxes. The U.S. Tax Court handed Lori
Singleton-Clarke her victory last month, saying the 47-year-old
Bryantown, Md., woman had properly deducted nearly $15,000 in business
school tuition. The Tax Court ruling should make it easier for many
other professionals to deduct the expense of a Master in Business
Administration degree.
dee davidson
Leventhal School of Accounting
Marshall School of Business
University of Southern California
January 11, 2010 reply from Ramsey, Donald
[dramsey@UDC.EDU]
To get to the essence of this concept, you really
need to read the case at
http://www.ustaxcourt.gov/InOpHistoric/SINGLETON-CLARKE.SUM.WPD.pdf
The degree in question was an MBA with a
concentration in Health Care Administration, from the University of Phoenix.
The tax court held that the degree did not qualify her for a new occupation,
but did enhance her skills in her existing job.
An interesting observation was that sometimes an
MBA does qualify one for a new occupation, but not always. The court also
noted that the MBA does not lead to any particular professional license.
I suppose an MBA with a concentration in accounting
might be construed as leading to a professional license, and likely so would
an MAcc. Such graduates, of course, are not all necessarily intending to
seek the CPA, but if they do sit for the CPA exam I suppose that would
likely disqualify the deduction even though the individual might continue
working as an accountant.
Cheers,
DR
(A message from Pod L, 7L13, of the UDC temporary
satellite station in the Intelsat Building) Donald D. Ramsey, CPA,
Department of Accounting, Finance, and Economics, School of Business and
Public Administration, University of the District of Columbia, 4200
Connecticut Ave., N. W., Washington, D. C. 20008. (202) 274-7054.
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/BookBob1.htm#010304Taxation
Free Tax Tutorials for Professors and Students
Tax Analysts, a non-profit pubic service organization
that provides in-depth tax information resources for tax professionals, has
announced it is making its news and research products available at no charge to
accounting, law, and economics professors and their students.
AccountingWeb, June 28, 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=103676
See
http://taxprof.typepad.com/taxprof_blog/files/tax_analysts_campus.pdf
Free accounting and tax course materials are
linked at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#Materials
The Journal of Accountancy has many free accounting and tax helpers ---
http://www.aicpa.org/pubs/jofa/joahome.htm
Free Tax Software for Low Income Individuals
Free File Alliance ---
http://en.wikipedia.org/wiki/Free_File_Alliance
"TurboTax Customers Angry Over Change In Tax Return Software," CBS
News via Paul Caron, TaxProf Blog, January 14, 2015 ---
http://taxprof.typepad.com/taxprof_blog/2015/01/turbotax-customers-angry-.html
Changes to the popular tax program, TurboTax, has some customers mad.
“People are just livid. They feel deceived,” says consumer advocate Edgar
Dworsky. “They feel they’ve used this product for so many years, they’ve
trusted it, and now they’re being sandbagged.” Dworsky is a TurboTax
customer unhappy after Intuit, the maker of TurboTax, changed the deluxe
version of the popular tax preparation software product.
The changes require customers to upgrade to more expensive versions if
reporting investment, self-employment, or rental income — costing an extra
$30 to $40 — and surprising many long-time Turbo customers. “Imagine their
surprise when they get halfway through doing their taxes and there is a
roadblock in the program that says you have to upgrade,” added Dworsky.
“It can be viewed as a bait and switch, yes,” Prof. Bryan Menk told KDKA
money editor Jon Delano on Tuesday, “because people were not accustomed to
this limitation in a prior year.” Menk teaches taxation at Duquesne
University and uses TurboTax himself.
Jensen Comment
Reminds me of the time TurboTax tried to stick it to users who fought back with
a boycott that led to changed pricing by TurboTax in 2008.
In other words the consumer boycott worked in 2008.
Sounds to me like it's time for another boycott.
2008 TurboTax Boycott
Tax Software Boycott of TurboTax Begins: I'll Bet You Can't Find the Hidden
Fees Disclosed on the TurboTax Website
Note that this was back in the time when most taxpayers mailed in hard copy
printouts of their tax returns. It was common to by one copy of TurboTax and
then file returns for other members of the family such as when a married couple
filed separate returns.
Users are not complaining about the functionality of
TurboTax. The problem, as they see it, is with pricing changes. For the first
time, TurboTax producer Intuit started charging users an additional
$9.95 for each additional return whether they print or
e-file. Also, readers complain that the 2008
software costs more at checkout, jumping from $44.95 to $59.95. (However, when
AccountingWEB went on Amazon, the software could be had at the discounted price
of $54.99.) . . . One reviewer seemed to be issuing a battle cry by writing,
"Time to start the boycott." Another reviewer had criticism of a more personal
nature: "You should fire the person who came up with pay to print!" Of the 182
product reviews as of the evening of December 9, 2008, 171 of them were one-star
reviews and only five were five-stars, the highest rating. Of the five five-star
ratings, one user named Fernando Ortega said TurboTax is still the best,
pointing out that he doesn't have to enter all of his personal information and
previous returns manually.
"TurboTax turmoil: Online reviews pan the top selling software,"
AccountingWeb, December 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=106620
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Jensen Comment
H&R Block did not raise the 2008 software fee and had no additional user fee ---
http://newsblaze.com/story/2008120913262200003.mwir/topstory.html
I shifted to TaxCut years ago and have never regretted doing so ---
http://www.hrblock.com/taxes/products/software/index.html
Maybe it's just me, but I prefer to buy TaxCut in the box at Wal-Mart so that I
have a CD for each year to file away. I prefer not to download the software
directly, although download updates are free and easy to install.
It has been popular in the past for a person to file his or her tax return
and then use the same software for filing the tax returns of children or
parents. No longer will this be possible for free from TurboTax. Presumably the
add-on fee has to be paid when spouses file separate returns rather than a joint
return. Turbo Tax along with other popular tax software for individuals does
participate in the
Free
File Alliance for taxpayers having less than $54,000 adjusted gross income.
This is only free tax software for the Federal Return, but the
accompanying TurboTax State Return costs $26 so all is not free if you need to
file both a State and Federal Return using Turbo Tax.
The new additional return fee irks taxpayers in 2008 just like the TurboTax
activation fee in 2003 really irked taxpayers ---
http://www.pcmag.com/article2/0,1895,821308,00.asp
What irks me is how hard it is at the TurboTax Web site about this $9.95
additional return fee. It's almost like TurboTax is playing a game to make it
easier to drop the fee if the boycott really becomes serious.
Another thing that irks me with the TurboTax Web site is that it highlights
that users can get a free edition of TurboTax and allows users to start filling
in the information. Then it suddenly springs on the purchase fee along the way
for users who will have an adjusted gross income above $54,000 after they have
started preparing their return. This essentially wastes their time if they
decide not to order the Turbo Tax software for $59 directly from TurboTax. For
example, someone who decides to pay $54 from Amazon essentially has to start
over preparing the return. I think hiding the $54,000 AGI maximum is highly
unethical on the part of the TurboTax Website.
"Users Grade Tax Software,"
by Stanley Zarowin, Journal of Accountancy, October 2007 ---
http://www.aicpa.org/pubs/jofa/oct2007/tax_software.htm
2008 Professional Tax Software as Listed in a November 7, 2008 Accounting Web
Newsletter
2008 Update from WebCPA ---
http://www.webcpa.com/article.cfm?articleid=29425
From the Journal of Accountancy
Smart Stops on the Web in 2008
-
Bob Jensen's tax helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Bob Jensen's accounting software helpers are
at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
"Faculty Members Given Laptops May Incur Taxes, by David Shieh,
Chronicle of Higher Education, January 7, 2008 ---
http://chronicle.com/wiredcampus/article/3541/faculty-members-given-laptops-may-incur-taxes?utm_source=at&utm_medium=en
From Smart Stops on the Web,
Journal of Accountancy, October 2007 ---
http://www.aicpa.org/pubs/jofa/oct2007/smart_stops.htm
TAX |
|
BIG RESOURCES
FOR SMALL BUSINESSES
www.irs.gov/businesses/small
Whether you own a small business or work for one, this IRS site
sorts out tax-related information so you don’t have to. There’s an
A–Z index that lets you search by business type or by subject. It
lists the necessary forms for each and links to information on
starting up, closing down and everything in between. You also can
sign up for the “e-News for Small Businesses” electronic newsletter
or download complimentary tax products, including tax calendars and
videos. And, of course, there’s plenty of guidance on e-filing and
forms for both small businesses with employees and the
self-employed.
CONSTRUCTIVE
CRITICISM
www.improveirs.org
Got a beef with the IRS? The Taxpayer Advisory Panel, a federal
advisory committee established under the authority of the Treasury
Department, is a group of volunteers working to improve the Service.
Its Web site features a comment box and phone number where citizens
can make suggestions. You can also view taxpayer suggestions that
have become proposals, which range from the general (improving the
quality of customer service), to the picky (adding lines to forms)
to the technical (expanding the third-party authorization On The Web
time frame). Want to join the panel? There’s information on becoming
a member in the FAQ section.
KNOW THE LAW
http://tax.cchgroup.com/legislation
Turn to this site for coverage of new tax legislation and analysis
of its impact on taxpayers and tax professionals, plus comments on
proposed tax law reform. Click on the “Full CCH Coverage Here” links
for access to “Tax Briefing” PDFs, which include in-depth analyses
of the legislations’ tax credits, deductions and effective dates.
The site also offers “Quick Tax Facts” PDFs for several pieces of
legislation, including the Small Business and Work Opportunity Act
of 2007; Tax Relief and Health Care Act of 2006; and the Pension
Protection Act of 2006. |
Methodology to Identify Small Businesses and Their Owners
Department of the U.S. Treasury
Technical Paper 4
August 2011 ---
Click Here
http://www.treasury.gov/resource-center/tax-policy/tax-analysis/Documents/OTA-T2011-04-Small-Business-Methodology-Aug-8-2011.pdf
Comments from Paul Caron on August 9, 2011 ---
http://taxprof.typepad.com/
The Treasury Department's
Office of Tax Analysis has released
Methodology to Identify Small Businesses and Their Owners:
Due to data constraints and the lack of clear
definitions, prior analyses of the tax code’s impact on small business
owners were flawed. In this paper, we develop a methodology to define
and identify small businesses. We then apply that methodology to a new
data source to identify the individual owners of those small businesses.
Having matched owners to their small business entities, we present
tabulations that detail various tax characteristics of small businesses
and their owners for tax year 2007. ...
For tax year 2007, our previous methodology
counted 34.7 million filers reporting $662 billion of net flow-through
business income as small business owners. Using our revised methodology,
we count 20.0 million filers reporting $376 billion of net business
income as small business owners under a broad measure of small business
owner. Under our narrow definition, we count 9.4 million filers
reporting $335 billion of net business income as small business owners.
From Smart Stops on the Web, Journal of Accountancy, July 2007 ---
http://www.aicpa.org/pubs/jofa/jul2007/news_web.htm
THE
BLOGGING PROFESSOR
http://taxprof.typepad.com This Smart Stop provides a daily dose of tax
news, papers and court judgments. Professor Paul
Caron of the University of Cincinnati College of
Law updates the site frequently with a balance
of academic and practical items, ranging from
IRS reports to details on upcoming tax
conferences. CPAs can use the topical archive to
find posts by subject tag. Caron’s site is part
of the Law Professor Blogs Network (see “Smart
Stops on the Web,” JofA, Oct. 06,
page 27), which hosts a variety of academic
blogs on securities, banking, nonprofits and
trusts. |
|
Free Video Helpers
From Smart Stops on the Web, Journal of Accountancy, July 2007 ---
http://www.aicpa.org/pubs/jofa/jul2007/news_web.htm
TAX ON THE
TUBE
www.taxtalktoday.tv Billed as “The Tax Show for the Tax Pro,” this
IRS-sponsored site hosts live programs featuring
tax experts and professionals on the second
Tuesday of the month, with video, podcasts and
transcripts of programs available from the
previous 12 months. Visit the “Program
Resources” tab before airtime for links to
workshops, forums and online tools on the
month’s tax topic. CPAs can earn one CPE credit
hour for every program watched or listened to
(live or archived) as long as their state board
accepts NASBA-sponsored programs—so it would be
wise to check with your state board before
buying credits. |
|
Question
Where do you rank in terms of annual income and total net worth?
Jensen Comment
It may surprise you how many full professors are in the top percentiles in terms
of academic-year salaries (before tax) plus supplementary income and how many
senior professors have TIAA-CREF and other savings net worth in the top 10th
percentile. The top fifty percent of income earners purportedly pay over 97% of
all taxes (income, FICA, property, estate, gift, sales taxes, and other)
collected from individuals in the U.S.
You can read more about tax collections at
http://www.askquestions.org/articles/taxes/
"Where Do You Stand on America's
Wealth Spectrum?" by Lee Eisenberg, Yahoo Finance, November 6, 2007 ---
http://finance.yahoo.com/banking-budgeting/article/103815/Where-Do-You-Stand-on-America's-Wealth-Spectrum
Annual
income parking ramp
Income
level (percentile) |
Median
income (rounded) |
Level VI
(90 to 100) |
$170,000 |
Level V (80
to 89.9) |
$99,000 |
Level IV
(60 to 79.9) |
$65,000 |
Level III
(40 to 59.9) |
$40,000 |
Level II
(20 to 39.9) |
$24,000 |
Level I
(less than 20) |
$10,000 |
Source: Before-Tax
Family Income, 2001
Federal Reserve Board Survey
So does making $170,000 a year make a person
rich? Last year a plurality of respondents (29
percent) in a survey by The New York Times said
that "rich" was making between $100,000 and
$200,000 a year. Unfortunately, the survey
didn't break out how many people in that salary
range considered themselves rich. If the people
I talk to are any indication, very few do.
Of course, income is only
one part of the equation defining where you
stand.
Net worth is more telling. Net worth, as
every financially precocious schoolchild knows,
is the sum of one's assets --
home equity, investments, savings
accounts, retirement funds, cars, furnishings
and such things as jewelry, furs, wine
collection, old baseball cards -- minus all
outstanding liabilities such as
mortgage balance, revolving and
credit card debt, college loans and so
on. Across all households, the national median
net worth is $86,000. Half of your fellow
citizens have more than that, half less. As you
see, there's a massive disparity between the
haves and have-nots.
Net worth parking ramp
Net worth
(percentile) |
Median net
worth (rounded) |
Level VI
(90 to 100) |
$833,600 |
Level V (80
to 89.9) |
$263,100 |
Level IV
(60 to 79.9) |
$141,500 |
Level III
(40 to 59.9) |
$62,500 |
Level II
(20 to 39.9) |
$37,200 |
Level I
(less than 20) |
$7,900 |
Source: Family Net
Worth, 2001 Federal Reserve Board Survey
We
live in a country that once celebrated itself as
egalitarian, yet 1 percent of the population --
nearly 3 million people -- currently has as much
money as the 100 million people at the bottom of
the ramp.
Yet when I ask those at the top of the ramp how
they feel about the future, whether their
fortunate place on the ramp gives them a measure
of confidence about it, they shake their heads.
They give me a look that says, "What planet do
you park on?"
You and your broker If you're not parked near
the top of the ramp, you're of little or no
interest to financial services firms and
financial advisers. There's no money to be made
at these levels. Last year, a handful of Wall
Street firms told their brokers they would no
longer receive commissions on accounts holding
less than $50,000. This effectively tells people
with nano-Numbers to get lost. But for the Wall
Street firms, there's gold on the floors above.
The greater the household assets, the more fees
and transaction costs can be extracted from an
account. The result is a flood of advertising
that captures a lifestyle so gloriously affluent
it's enough to make everybody feel poor.
Those who manage Numbers break customers down
into innumerable segments to better target them
through their marketing efforts. These segments
take into consideration all the usual
demographic characteristics, such as age, income
and net worth. Other segmentation models define
you according to psychographic qualities:
personal interests, leisure-time activities,
whether you are active or passive when it comes
to managing your affairs -- including, for
instance, how comfortable you are using a
computer. Once a financial services company
figures it has your Number, it will use what it
thinks are the most effective channels to get
its hands on it. It will place advertising in
the magazines and newspapers you read and the
television shows and Web sites you browse. And
it will probe you incessantly through the
mailbox, testing or selling financial products
and services.
The Number industry divides people on the top
floors of the garage into three broad segments
of wealth, each of which is nicely profitable.
The biggest and broadest affluent segment
consists of people with investable assets of
between $200,000 and $1 million to $2 million.
This group is sometimes referred to as mass
affluent, and it would be fair to think of it as
the meat and potatoes of the financial services
business. If you're at the lower end of that
range -- if you have, say, $300,000 in your
accounts -- you're definitely of prime interest
to the brokers and customer reps at Merrill
Lynch, Smith Barney, Vanguard and the rest. But
they need to be careful lest you cost them
money.
To assign a real live broker (oops, financial
consultant) to a client who keeps too low a
Number is tantamount to Safeway assigning a
personal shopper to anyone who comes in to buy a
quart of milk. Still, there are profitable ways
for financial services firms to serve smaller
customers: the telephone, assuming they can keep
the calls short and to the point and, better
still, the online channel, where self-service is
highly cost-effective. This is not to say that
firms aren't happy to see you walk into their
investment centers for a quick hello and a
fill-out-the-papers session. They'll shake your
hand, put an arm around your shoulder, even pour
you a cup of coffee. After that, the more you
manage your own modest Number, the better for
them and the more cost-effective for you.
The next segment up from mass affluent is where
the action gets white hot. This parking level
belongs to those designated as high net worth
individuals (or HNWIs). There are no universal
criteria here. Generally, HNWIs have invested
assets of at least $1 million, although some
companies also target younger households with
healthy six-figure incomes, knowing that their
net worth is likely to reach target levels in
the near future. Right now there are well over 7
million high net worth households in the United
States, with a forecasted growth rate of 16
percent a year and projected assets of $32
trillion. Yum.
If their marketing efforts are any indication,
Wall Street firms see HNWIs as the happiest
people in the world, no matter that so many of
them are, rightly or wrongly, distressed over
their long-term prospects. Distress is not
what's pictured in the ads. The ads are filled
with images of zippy seniors who flash large
white teeth and incredibly healthy gums. They
dance. They jog. They bike. They fish. They
golf. They snuggle. According to the ads, life
is a theme park expressly designed for the
middle-aged. Graying boomers waltz across their
living rooms, raise glasses to one another on
the decks of ocean liners and exchange smiles
secure in the knowledge that a surefire
blue-steel erection is just a pill away. These
ads remind us that we are living in the Golden
Age of Aging. Not only are we younger and
healthier than middle-aged people used to be,
many of us would probably have been blind,
disabled or dead by now had we had the bad luck
to have been born just a tiny bit sooner.
Valet parking If you've made it onto the top
levels of the ramp -- say you have at least $5
million in investments -- you are deemed to be
an ultra high net worth individual (or UHNWI).
This is a very nice position to hold in life,
all the sweeter thanks to recent federal tax
cuts. People earning $10 million a year hand
over a smaller percentage of their income to the
government than those earning a tenth of that
and -- to a great degree -- escape the "gotcha"
snare of the alternative minimum tax, according
to The New York Times. The treatment extended to
a UHNWI approaches that accorded to royalty. As
a UHNWI, you aren't offered a cardboard cup of
day-old sludge from a Mr. Coffee machine. Now
you qualify for a china cup of freshly brewed
java from a gleaming French press. They'd better
get another grinder or two. The Boston
Consulting Group reports that 3,000 new
households a year lay claim to $20 million or
more in invested assets. Should you be among
them, put your feet up and just whistle for
service.
If getting yourself to a firm's teak-paneled
office is too much of a schlep, the investment
advisers will high-tail it to you. They'll be
more than delighted to take you to dinner at the
best place in town and toast your success with
the finest vintages on the menu. They go to this
expense because they obviously respect your
business prowess and find you personally
charming. Mostly, though, they admire you for
your assets. They will ply you with leather
binders filled with laser-printed pie charts,
bar graphs and three-dimensional wave diagrams.
Over dessert, they will produce PowerPoint
slides that show how your nest egg will incubate
and eventually burgeon into a soaring phoenix
that will carry your Number higher and higher,
all thanks to their nurturing and personal
attention.
There is yet one more place to park, higher up
and more exclusive still. This spot is for
people for whom even discreet, private banking
is déclassé. On this level of the ramp you forgo
the wealth managers at even the toniest trust
companies and rely instead on your own "family
office," complete with its own in-house
investment manager and staff.
Typically, families with family offices have
$100 million, $500 million, $1 billion, enough
to blow off even the Lehmans, the Goldmans and
the Northern Trusts of the world. At present,
there are approximately 5,000 family offices
around the country. Family offices are not for
strivers -- at least not yet. But family offices
may be going the way of fractional jets, shared
yachts and high-end vacation-home clubs. People
with only 20 million Numbers have begun to band
together to create, in effect, multifamily
offices to oversee their investments and estate
planning.
Back down on the street, though, it's another
world. Most people have to circle the block,
just looking for a way to get into the damn
garage.
Wikipedia has a great module on the history
and theory of taxation ---
http://en.wikipedia.org/wiki/Tax
Who Pays America's Tax Burden, and Who Gets the Most Government Spending?
by Andrew Chamberlain, Gerald Prante and Scott A. Hodge
Special Report No. 151
March 22, 2007
Tax Foundation
http://www.taxfoundation.org/publications/show/2282.html
Executive Summary
While many studies answer the question of who pays taxes in America, the
question of who gets the most government spending is often overlooked. Just
as some Americans bear a larger portion of the nation's tax burden than
others, some Americans also receive a larger share of the nation's
government spending.
This report summarizes the key findings of a
comprehensive
2007 Tax Foundation study of federal, state and
local taxes and government spending. The results show that when we consider
the distribution of government spending as well as taxes, it provides a
dramatically altered view of how U.S. fiscal policy affects Americans at
different income levels than is apparent from the distribution of tax
burdens alone.
Overall, we find that America's lowest-earning
one-fifth of households received roughly $8.21 in government spending for
each dollar of taxes paid in 2004. Households with middle-incomes received
$1.30 per tax dollar, and America's highest-earning households received
$0.41. Government spending targeted at the lowest-earning 60 percent of U.S.
households is larger than what they paid in federal, state and local taxes.
In 2004, between $1.03 trillion and $1.53 trillion was redistributed
downward from the two highest income quintiles to the three lowest income
quintiles through government taxes and spending policy.
These findings suggest tax distributions alone do
not tell Americans how much the nation's fiscal system is helping or hurting
low-income households. To answer that, we must look beyond tax burdens to
government spending as well. Lawmakers who ignore the distribution of
government spending risk making policy judgments based on an incorrect set
of facts about the United States fiscal system.
Jensen Comment
Keep in mind that there are all sorts of definitional and externality problems
when it comes to measuring how much is “received” from the government versus how
much is “taxed.” For example, when a when the government provides each tobacco
farmer with an allotment or quota on the amount of tobacco that can be grown per
acre, the tobacco price is artificially increased without necessarily receiving
a check from the government. The same thing happens to businesses and
individuals who benefit from import or other quotas. The same thing could be
accomplished by not having such allotment quotas and reimbursing farmers (from
the government) for price differentials. Also the government may force direct
transfer payments in the private sector in lieu of taxing and redistributing
payments from Peter to pay Paul.
"The Most Tax-Friendly and Unfriendly States For Business," by Charley
Blaine, 24/7 Wall Street, October 11, 2013 ---
Click Here
http://247wallst.com/special-report/2013/10/11/the-most-tax-friendly-states-for-business-2/?utm_source=247WallStDailyNewsletter&utm_medium=email&utm_content=OCT142013A&utm_campaign=DailyNewsletter
Jensen Comment
There may be better ways to define "friendly" than in terms of business and
individual taxes. For example, Texas did not make the tax-friendly list in
comparison with Wyoming, Alaska, New Hampshire, and Nevada. Yet firms are
flocking more to Texas that all of those other states combined. Being tax
friendly does not trump such things as available workforce (yes Hispanics in
Texas are good workers) and incentives provided by state and local governments.
Location is important with Texas being a gateway to commerce south of the Rio
Grande. Large airport hubs are important to attracting new businesses. This also
gives Dallas and Houston an edge. And not having labor union strife is
all-important which favors southern states relative to New England and New York.
Our goal is for our economy to look more like Texas,
and a lot less like California.
Sam. Brownback, 2012 Governor
of Kansas ---
http://en.wikipedia.org/wiki/Sam_Brownback
"The Heartland Tax Rebellion: More states want to repeal their
income taxes," The Wall Street Journal, February 7, 2012 ---
http://online.wsj.com/article/SB10001424052970203889904577200872159113492.html#mod=djemEditorialPage_t
Oklahoma Governor Mary Fallin is starting to feel
surrounded. On her state's southern border, Texas has no income tax. Now two
of its other neighbors, Missouri and Kansas, are considering plans to cut
and eventually abolish their income taxes. "Oklahoma doesn't want to end up
an income-tax sandwich," she quips.
On Monday she announced her new tax plan, which
calls for lowering the state income-tax rate to 3.5% next year from 5.25%,
and an ambition to phase out the income tax over 10 years. "We're going to
have the most pro-growth tax system in the region," she says.
She's going to have competition. In Kansas,
Republican Governor Sam Brownback is also proposing to cut income taxes this
year to 4.9% from 6.45%, offset by a slight increase in the sales tax rate
and a broadening of the tax base. He also wants a 10-year phase out. In
Missouri, a voter initiative that is expected to qualify for the November
ballot would abolish the income tax and shift toward greater reliance on
sales taxes.
South Carolina Governor Nikki Haley wants to
abolish her state's corporate income tax. And in the Midwest, Congressman
Mike Pence, who is the front-runner to be the next Republican nominee for
Governor, is exploring a plan to reform Indiana's income tax with much lower
rates. That policy coupled with the passage last week of a right-to-work law
would help Indiana attract more jobs and investment.
That's not all: Idaho, Maine, Nebraska, New Jersey
and Ohio are debating income-tax cuts this year.
But it is Oklahoma that may have the best chance in
the near term at income-tax abolition. The energy state is rich with oil and
gas revenues that have produced a budget surplus and one of the lowest
unemployment rates, at 6.1%. Alaska was the last state to abolish its income
tax, in 1980, and it used energy production levies to replace the revenue.
Ms. Fallin trimmed Oklahoma's income-tax rate last year to 5.25% from 5.5%.
The other state overflowing with new oil and gas
revenues is North Dakota thanks to the vast Bakken Shale. But its
politicians want to abolish property taxes rather than the income tax.
They might want to reconsider if their goal is
long-term growth rather than short-term politics. The American Legislative
Exchange Council tracks growth in the economy and employment of states and
finds that those without an income tax do better on average than do high-tax
states. The nearby table compares the data for the nine states with no
personal income tax with that of the nine states with the highest personal
income-tax rates. It's not a close contest.
Skeptics point to the recent economic problems of
Florida and Nevada as evidence that taxes are irrelevant to growth. But
those states were the epicenter of the housing bust, thanks to overbuilding,
and for 20 years before the bust they had experienced a rush of new
investment and population growth. They'd be worse off now with high
income-tax regimes.
The experience of states like Florida, New
Hampshire, Tennessee and Texas also refutes the dire forecasts that
eliminating income taxes will cause savage cuts in schools, public safety
and programs for the poor. These states still fund more than adequate public
services and their schools are generally no worse than in high-income tax
states like California, New Jersey and New York.
They have also recorded faster revenue growth to
pay for government services over the past two decades than states with
income taxes. That's because growth in the economy from attracting jobs and
capital has meant greater tax collections.
The tax burden isn't the only factor that
determines investment flows and growth. But it is a major signal about how a
state treats business, investment and risk-taking. States like New York,
California, Illinois and Maryland that have high and rising tax rates also
tend to be those that have growing welfare states, heavy regulation,
dominant public unions, and budgets that are subject to boom and bust
because they rely so heavily on a relatively few rich taxpayers.
The tax competition in America's heartland is an
encouraging sign that at least some U.S. politicians understand that they
can't take prosperity for granted. It must be nurtured with good policy, as
they compete for jobs and investment with other states and the rest of the
world.
"Our goal is for our economy to look more like
Texas, and a lot less like California," says Mr. Brownback, the Kansas
Governor. It's the right goal.
Continued in article
State Individual Income Tax Rates in the 50 States, 2000-2011 ---
http://www.taxfoundation.org/taxdata/show/228.html
On a per capita basis ---
50-State Table of State and Local Individual Income Tax Collections Per
Capita
Comparison of Corporate Income Tax Rates in the 50 States ---
http://www.taxfoundation.org/taxdata/show/230.html
On a per capita basis ---
http://www.taxfoundation.org/taxdata/show/281.html
This is a little misleading since many states like Illinois give their
largest corporate employers "Get Out of Tax Free" cards (or offsetting
subsidies)
State Sales, Gasoline, Cigarette, and Alcohol Tax Rates by State,
2000-2010 ---
http://www.taxfoundation.org/publications/show/245.html
PBS Video: What Do Tax Rates' Ups and Downs Mean for
Economic Growth?
http://video.pbs.org/video/2176062522
Thank you Paul Caron for the heads up.
Marginal Tax Rates Around the World ---
http://www.econlib.org/library/Enc/MarginalTaxRates.html
Bob Jensen's threads on taxation ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#Taxation
Question
How can you compare living costs between any two towns in the U.S.?
The Salary Mess (causing faculty attrition rates) for Universities in
Wisconsin
The problem is money. Wisconsin's stagnating state
higher-education budget has forced the university to keep faculty salaries far
below average. When professors get feelers from elsewhere, they learn that a
move can easily mean a whopping 100-percent salary increase — sometimes more.
Budget problems have also depleted money for perks that keep faculty members on
board — funds for research and travel, pay for summer months, reduced teaching
loads, and longer and more frequent sabbaticals.
Robin Wilson, "Wisconsin's Flagship Is Raided for Scholars," Chronicle of
Higher Education, April 18, 2008, Page A1 ---
http://chronicle.com/weekly/v54/i32/32a00103.htm
Jensen Comment
The problem is that analysts in general tend to compare average before-tax
salaries and living costs. Although Wisconsin is slightly low in terms of
state-supported university salaries, on an after-tax basis they are very low due
to high taxes in Wisconsin.
Wisconsin's State/Local Tax
Burden Among Nation's Highest in 2007 ---
http://www.taxfoundation.org/research/topic/67.html
During the past three decades Wisconsin's
state and local tax burden has consistently ranked among the nation's
highest. Estimated at 12.3% of income, Wisconsin’s state and local tax
burden percentage ranks 7th highest nationally, well above the national
average of 11.0%. Wisconsin taxpayers pay $4,736 per capita in state and
local taxes, and per capita state income is $38,639.
Wisconsin's
State-Local Tax Burden, 1970-Present
On the other hand, some states that also pay lower than average faculty
salaries are winners in terms of letting faculty keep more of their income. For
example, consider Delaware:
Delaware's State/Local Tax
Burden Fourth Lowest in Nation in 2007 ---
http://www.taxfoundation.org/research/topic/18.html
Consistently over the past two decades,
Delaware has had one of the nation’s lowest state and local tax burdens.
Estimated at 8.8% of income, Delaware’s state-local tax burden percentage
ranks 47th highest nationally, well below the national average of 11.0%.
Delaware taxpayers pay $3,804 per-capita in state and local taxes, and per
capita state income is $43,471.
Delaware's
State-Local Tax Burden, 1970-present
States like New York, New Jersey, and California that have relatively high
average salaries for their major research universities can be losers in terms of
taxes and real estate costs. Real estate costs in those states are still high
even after the bursting of the sub-prime bubble. High taxes are also bummers in
Maine and Vermont. States like Florida that used to be good deals for taxes and
real estate costs have seen property taxes and insurance costs soar.
You may feed in the name of any state you choose and get state and local tax
burden comparisons ---
http://www.taxfoundation.org/research/topic/18.html
You probably should go to the above site before comparing the average
salaries (by faculty rank) of U.S. colleges and universities (public and
private) that are listed in several sections of Chronicle of Higher
Education, April 18, 2008"
- Page A19: Leading private universities, public universities,
community colleges, and liberal-arts colleges.
- Page A 20: Expanded table and graphs.
- Pages A22-24: More than 1,300 major universities and colleges
listed by each of the 50 states in the U.S. (averages by faculty rank)
If you are attracted to or turned off by the average salaries (by faculty
rank) in a given school, don't forget to compare taxes and real estate costs.
There are also other cost considerations like the cost of private schools in
some urban areas that have low cost or dangerous public schools K-12.
"States Where People Pay the Most (and Least) in Taxes," by Charles B.
Stockdale, Michael B. Sauter, Douglas A. McIntyre, Yahoo Finance, July
21, 2011 ---
http://finance.yahoo.com/taxes/article/113173/states-pay-most-least-taxes-247wallst
Jensen Comment
But we're only operating in the narrow range of 6.3% (Alaska) to 12.2% (New
Jersey) for state and local taxes, including property taxes. One would hope
that, by adding to a state's tax burden, the quality of education would be the
result of higher taxes. This, however, is not the case for most states. For
example, South Dakota comes in at Rank 3 with a very low 7.6% tax burden and
manages to have one of the very best K-12 rural and urban education systems
among the 50 states. Unfortunately, this does not extend to higher education in
South Dakota. New Jersey has the highest taxation rate of 12.2% but does not get
a whole lot of K-12 bang for the buck in terms of education compared with the
low taxation states of South Dakota, New Hampshire, and Tennessee.
The largest cities in the U.S. face the most daunting problems in K-12
education. Problems with rural versus urban may be greater than problems with
high state taxation versus low state taxation. For example, rural New York has
some very nice rural K-12 schools that exist apart from troubled NYC schools. On
the other hand, rural Texas has some of the worst rural K-12 schools in the
nation. Mississippi has some of the worst urban and rural schools in the nation,
but Mississippi is neither a high nor a low taxation state total state and local
taxation rankings. However, in terms of local property taxation, Mississippi has
low property tax burdens. Quality of schools in rural communities correlates
highly and negatively with degree of poverty in those communities. Quality of
urban schools is more complicated. New York City and Chicago are quite wealthy
and prosperous in ways that do not translate in to quality of K-12 inner city
public schools. Minneapolis is less prosperous and wealthy but probably has
somewhat better public schools. although in every large U.S. city the inner city
schools are lower in quality than schools in their suburbs.
Bob Jensen's threads on taxation are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#010304Taxation
Best and Worst Run States in America — An
Analysis Of All 50
From the AICPA CPA Letter Daily on December 7, 2011
For the second year, 24/7 Wall St. ranked the 50
states according to how well they are run. Factors included the state's
financial health, standard of living, education system, employment rate, crime
rate and how efficiently the state uses its resources to provide government
services. 24/7 Wall St. determined that Wyoming is the best-run state and
California is the worst run.
24/7 Wall St.
http://247wallst.com/2011/11/28/best-and-worst-run-states-in-america-an-analysis-of-all-50/
Jensen Comment
The best-run state is Wyoming. The worst-run state is California Most of
the Top Ten best-run states have relatively low populations. Small seems to be
better in terms of state government efficiency, although social programs and
cold weather in those states tend to repel welfare and Medicaid recipients from
around the nation. It's difficult to draw liberal versus conservative
explanations for best-run states since liberal states of Vermont and Minnesota
are mixed in the Top Ten along with the conservative states of Wyoming, Utah,
and the two Dakota states.
Minnesota has the least debt per capita, but the union-run state of
Massachusetts has the most debt per capita. This is somewhat interesting because
both Minnesota and Massachusetts are viewed as liberal states (more so in the
days of Hubert Humphrey and Walter Mondale). The relatively conservative
southern states tend to be below the median on state debt per capita. The
western states are more variable. I accuse Taxachusetts of being union-run in
part because Boston refuses to allow Wal-Mart stores until Wal-Mart becomes
unionized.
When it comes to debt per capita there is less denominator effect than I
suspected beforehand, although small populations become a huge factor behind the
high debt loads per capita in Alaska, Rhode Island, and Delaware. Alaska can
also afford a higher debt load because of vast untapped natural resources.
I watched two very liberal commentators from Boston on television last night
arguing that more debt load in Taxachusetts to support increased spending for
social programs was a good investment of that state's economy. This seems to be
questionable given where Taxachusetts already stands in relation to debt per
capita.
Compare taxes for all 50 states of the U.S, at ---
http://www.taxfoundation.org/research/topic/18.html
Compare the living costs of any two locales in the United States in terms
of how far your salary will go in these to locales (such as where you live now
versus where you might want to move to) ---
Click Here ---
http://snipurl.com/comparelivingcosts
[www_salary_com]
Bob Jensen's threads on Salary Compression, Inversion, and Controversies ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#Salaries
Following are the “Business Tax Index” scores and rankings,
followed by brief descriptions of
why each factor is included in the Index, and how it is
measured.
•Personal Income Tax.
State personal income tax rates affect individual economic decisionmakingin
important ways. A high personal income tax rate raises the costs of working,
saving, investing, and risk taking. Personal income tax rates vary among states,
therefore impacting crucial economic decisions and activities. In fact, the
personal income tax influences business far more than generally assumed because
roughly 90 percent of businesses file taxes as individuals (e.g., sole
proprietorship, partnerships and S-Corps.), and therefore pay personal income
taxes rather than corporate income taxes.
Measurement: state’s top personal income
tax rate.1
Jensen Comment
The above tax rates are a little misleading in some states. For example, New
Hampshire shares Rank 1 with a zero percent rate. However, New Hampshire has a
five percent tax on dividends and interest payments above a $5,000 exemption and
excluding all interest and dividends embedded in pension payments. The New
Hampshire tax does include interest payments on municipal bonds, exempt from
Federal income tac, issued outside the state of New Hampshire. Some other states
have some sneaky ways of taxing without calling it an "income tax."
Of course a huge tax often overlooked when locating or relocating is the
property tax.
Jensen Comment
New Hampshire came out better than I expected based upon my experience. One
thing I noticed since moving to New Hampshire is that property is reappraised
much less often. In 2006 my home was re-appraised after the previous appraisal
in 1996. When I lived in San Antonio, homes were re-appraised at least every
year. Frequent appraisals can be good news or bad news, but they are mostly bad
news for people who live in desirable neighborhoods (read that gated
neighborhoods in San Antonio) since these neighborhoods tend to go up in value
much more frequently than poorer neighborhoods.
Jensen Comment
The problem is that analysts in general tend to compare average before-tax
salaries and living costs. Although Wisconsin is slightly low in terms of
state-supported university salaries, on an after-tax basis they are very low due
to high taxes in Wisconsin.
Wisconsin's State/Local Tax
Burden Among Nation's Highest in 2007 ---
http://www.taxfoundation.org/research/topic/67.html
During the past three decades Wisconsin's
state and local tax burden has consistently ranked among the nation's
highest. Estimated at 12.3% of income, Wisconsin’s state and local tax
burden percentage ranks 7th highest nationally, well above the national
average of 11.0%. Wisconsin taxpayers pay $4,736 per capita in state and
local taxes, and per capita state income is $38,639.
Wisconsin's State-Local Tax Burden, 1970-Present
On the other hand, some states that also pay lower than average faculty
salaries are winners in terms of letting faculty keep more of their income. For
example, consider Delaware:
Delaware's State/Local Tax
Burden Fourth Lowest in Nation in 2007 ---
http://www.taxfoundation.org/research/topic/18.html
Consistently over the past two decades,
Delaware has had one of the nation’s lowest state and local tax burdens.
Estimated at 8.8% of income, Delaware’s state-local tax burden percentage
ranks 47th highest nationally, well below the national average of 11.0%.
Delaware taxpayers pay $3,804 per-capita in state and local taxes, and per
capita state income is $43,471.
Delaware's State-Local Tax Burden, 1970-present
States like New York, New Jersey, and California that have relatively high
average salaries for their major research universities can be losers in terms of
taxes and real estate costs. Real estate costs in those states are still high
even after the bursting of the sub-prime bubble. High taxes are also bummers in
Maine and Vermont. States like Florida that used to be good deals for taxes and
real estate costs have seen property taxes and insurance costs soar.
You may feed in the name of any state you choose and get state and local tax
burden comparisons ---
http://www.taxfoundation.org/research/topic/18.html
You probably should go to the above site before comparing the average
salaries (by faculty rank) of U.S. colleges and universities (public and
private) that are listed in several sections of Chronicle of Higher
Education, April 18, 2008"
- Page A19: Leading private universities, public universities, community
colleges, and liberal-arts colleges.
- Page A 20: Expanded table and graphs.
- Pages A22-24: More than 1,300 major universities and colleges listed by
each of the 50 states in the U.S. (averages by faculty rank)
If you are attracted to or turned off by the average salaries (by faculty
rank) in a given school, don't forget to compare taxes and real estate costs.
There are also other cost considerations like the cost of private schools in
some urban areas that have low cost or dangerous public schools K-12.
Compare taxes for all 50 states of the U.S. at ---
http://www.taxfoundation.org/research/topic/18.html
Some Interesting State Comparisons on State& Local Taxation, Business Climate,
and Debt Per Capita
http://www.cs.trinity.edu/~rjensen/temp/StateComparisons2012.htm
Compare the living costs of any two locales in the United States in terms
of how far your salary will go in these to locales (such as where you live now
versus where you might want to move to) ---
Click Here ---
http://snipurl.com/comparelivingcosts
[www_salary_com]
Bob Jensen's threads on Salary Compression, Inversion, and Controversies ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#Salaries
Bob Jensen's tax comparison helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Jensen Comment
Among cities that have hotels large enough for AAA annual meetings, what cities
might be avoided in an effort not to surprise attendees with enormous add ons to
rental car fees, hotel bills, and restaurant tabs?
What I don't know is whether this also includes those special surcharges
added to local sales taxes for construction of sports arenas that cost hundreds
of millions of dollars. My guess is that these surcharges are not added in for
some of the cities ranked below, because sometimes arena surcharges are only
tacked onto hotel bills in the city.
Warning: Note the difference between amount of a sales tax and its
breadth --- which makes Hawaii possibly the most expensive place to visit or
live.
"Sales Tax Rates in Major U.S. Cities," by Scott Drenkard, Alex Raut
and Kevin Duncan, The Tax Foundation, April 11, 2012 ---
http://www.taxfoundation.org/news/show/28117.html
. . .
Conclusion
Of course, sales taxes are just one part of an
overall tax structure and should be considered in context. For example,
Washington State has high sales taxes but no income tax; Oregon has no sales
tax but high income taxes. While many factors influence business location
and investment decisions, sales taxes are something within policymakers'
control that can have immediate impacts. One gauge of competitiveness is how
a city's sales tax rate compares to its neighbors.
Birmingham (a) |
Alabama |
4.0% |
6.0% |
10.0% |
1 |
Montgomery |
Alabama |
4.0% |
6.0% |
10.0% |
1 |
Chicago |
Illinois |
6.25% |
3.25% |
9.5% |
3 |
Glendale |
Arizona |
6.6% |
2.9% |
9.5% |
3 |
Seattle |
Washington |
6.5% |
3.0% |
9.5% |
3 |
Phoenix |
Arizona |
6.6% |
2.7% |
9.3% |
6 |
Memphis |
Tennessee |
7.0% |
2.25% |
9.25% |
7 |
Nashville |
Tennessee |
7.0% |
2.25% |
9.25% |
7 |
Tucson |
Arizona |
6.6% |
2.5% |
9.1% |
9 |
Mesa |
Arizona |
6.6% |
2.45% |
9.05% |
10 |
Baton Rouge |
Louisiana |
4.0% |
5.0% |
9.0% |
11 |
New Orleans (b) |
Louisiana |
4.0% |
5.0% |
9.0% |
11 |
Scottsdale |
Arizona |
6.6% |
2.35% |
8.95% |
13 |
New York |
New York |
4.0% |
4.875% |
8.875% |
14 |
Chandler |
Arizona |
6.6% |
2.2% |
8.8% |
15 |
Gilbert |
Arizona |
6.6% |
2.2% |
8.8% |
15 |
Buffalo |
New York |
4.0% |
4.75% |
8.75% |
17 |
Fremont (c) |
California |
7.25% |
1.5% |
8.75% |
17 |
Long Beach (c) |
California |
7.25% |
1.5% |
8.75% |
17 |
Los Angeles (c) |
California |
7.25% |
1.5% |
8.75% |
17 |
Oakland (c) |
California |
7.25% |
1.5% |
8.75% |
17 |
Spokane |
Washington |
6.5% |
2.2% |
8.7% |
22 |
Tulsa |
Oklahoma |
4.5% |
4.017% |
8.517% |
23 |
San Francisco (c) |
California |
7.25% |
1.25% |
8.5% |
24 |
Saint Louis |
Missouri |
4.225% |
4.266% |
8.491% |
25 |
Oklahoma City |
Oklahoma |
4.5% |
3.875% |
8.375% |
26 |
Austin (d) |
Texas |
6.25% |
2.0% |
8.25% |
27 |
Corpus Christi |
Texas |
6.25% |
2.0% |
8.25% |
27 |
Dallas |
Texas |
6.25% |
2.0% |
8.25% |
27 |
El Paso |
Texas |
6.25% |
2.0% |
8.25% |
27 |
Fort Worth |
Texas |
6.25% |
2.0% |
8.25% |
27 |
Garland |
Texas |
6.25% |
2.0% |
8.25% |
27 |
Houston |
Texas |
6.25% |
2.0% |
8.25% |
27 |
Irving |
Texas |
6.25% |
2.0% |
8.25% |
27 |
Laredo |
Texas |
6.25% |
2.0% |
8.25% |
27 |
Lubbock |
Texas |
6.25% |
2.0% |
8.25% |
27 |
Plano |
Texas |
6.25% |
2.0% |
8.25% |
27 |
San Jose (c) |
California |
7.25% |
1.0% |
8.25% |
27 |
San Antonio |
Texas |
6.25% |
1.875% |
8.125% |
39 |
Henderson |
Nevada |
6.85% |
1.25% |
8.1% |
40 |
Las Vegas |
Nevada |
6.85% |
1.25% |
8.1% |
40 |
North Las Vegas |
Nevada |
6.85% |
1.25% |
8.1% |
40 |
Arlington |
Texas |
6.25% |
1.75% |
8.0% |
43 |
Atlanta |
Georgia |
4.0% |
4.0% |
8.0% |
43 |
Aurora (e) |
Colorado |
2.9% |
5.1% |
8.0% |
43 |
Philadelphia |
Pennsylvania |
6.0% |
2.0% |
8.0% |
43 |
Contineud in article
In 2009 New Jersey, New York, and Connecticut hit residents with the highest
state taxes, but with the enormous tax hikes in such states as Illinois and
California, the top honors may shift in 2011. In 2011 states like New York are
going to tax the incomes of people who own property in New York but spend very
little, if any, time in New York. It would seem that owning second homes in New
York has become a rather dumb decision for people actually living in other
states. The new words of advice: Sell that Sucker in New York!
Note that the "tax burdens" on individuals include state income taxes,
property taxes, and sales taxes as well as other tax burdens. In many states if
they don't get you one way, they hit you in another way. For example, having no
income or sales taxes may shift much of the burden to property taxes. However,
the high tax states in general may be high in most of the types of tax.
California, however, gives some property tax relief to long-time owners because
of the infamous Proposition 13.
The calculations are quite confusing since sales, lodging, and property taxes
on out-of-state visitors and second home owners are reallocated back to states
of residence in somewhat complicated formulas.
"State-Local Tax Burdens Fall in 2009 as Tax Revenues Shrink Faster than
Income: New Jersey’s Citizens Pay the Most, Alaska’s Least," Special
Report 109, The Tax Foundation, February 2011 ---
http://taxfoundation.org/files/sr189.pdf
Table 1
State and Local Tax Burdens by Rank Fiscal Year
2009
State-Local State Tax Burden Rank
U.S. Average 9.8%
New Jersey 12.2% 1
New York 12.1 2
Connecticut 12.0 3
Wisconsin 11.0 4
Rhode Island 10.7 5
California 10.6% 6
Minnesota 10.3 7
Vermont 10.2 8
Maine 10.1 9
Pennsylvania 10.1 10
Massachusetts 10.0% 11
Maryland 10.0 12
Illinois 10.0 13
Arkansas 9.9 14
Nebraska 9.8 15
North Carolina 9.8% 16
Oregon 9.8 17
Ohio 9.7 18
Kansas 9.7 19
Utah 9.7 20
Michigan 9.7% 21
Hawaii 9.6 22
Delaware 9.6 23
Iowa 9.5 24
Indiana 9.5 25
North Dakota 9.5% 26
West Virginia 9.4 27
Idaho 9.4 28
Washington 9.3 29
Kentucky 9.3 30
Florida 9.2% 31
Georgia 9.1 32
Virginia 9.1 33
Missouri 9.0 34
Montana 8.7 35
Mississippi 8.7% 36
Oklahoma 8.7 37
Arizona 8.7 38
Colorado 8.6 39
Alabama 8.5 40
New Mexico 8.4% 41
Louisiana 8.2 42
South Carolina 8.1 43
New Hampshire 8.0 44
Texas 7.9 45
Wyoming 7.8% 46
Tennessee 7.6 47
South Dakota 7.6 48
Nevada 7.5 49
Alaska 6.3 50
Dist. of Columbia 9.6% (24)
Notes: As a unique state-local entity, D.C. is not included in rankings, but
the figure in parentheses shows where it would rank. The local portions of tax
collection figures for fiscal year 2009 rely on projections of local government
tax revenue Sources: Tax Foundation calculations using data from multiple
sources, primarily Census Bureau, Rockefeller Institute, Bureau of Economic
Analysis, Council on State Taxation, and Travel Industry Association.
Question
In the face of some of the most drastic declines in property values in the U.S.,
why have many California homeowners not seen their tax valuations decline?
Answer
Proposition 13 kept tax valuations way below market value during the blowing up
of the real estate bubble such that tax valuations did not have to decline when
the bubble burst (thereby sending market values back down closer to tax
appraisals). Unfortunately, Proposition 13 equivalents were not passed in other
states where increases in tax appraisals forced many fixed-income people out of
their homes.
"Prop. 13 Surprise," Investor's Business Daily, July 11, 2008 ---
http://www.ibdeditorials.com/IBDArticles.aspx?id=300669630582951
It may not get much national notice, but a
significant man-bites-dog story has emerged from the debris of California's
real estate bust. Cities and counties are finding that their assessment
rolls actually are going up while house values are diving.
Los Angeles County, for example, has seen its
latest roll rise 6.9% to $1.1 trillion even as area home prices have
depreciated 23%. Even nearby Riverside County, where the housing market has
been swamped by foreclosures, assessments have gone up 1.45%.
Meanwhile, state government is staring at a budget
gap of more than $15 billion, despite levying some of the highest personal
income-tax rates in the nation.
The key to this puzzle is, as the Los Angeles Times
notes, the role of Proposition 13 "as an economic stabilizer." Passed by
voters in 1978, when an earlier real-estate boom juiced assessments so fast
people were in danger of being taxed out of their homes, Prop. 13 now is
shielding cities and counties from the latest downdraft.
It does this by assessing homes at their sale
prices and limiting annual increases to 2% after that. A house bought for
$500,000 in 1995, for instance, would be assessed at no more than $647,000
in 2008, even if its market value was well over $1 million.
Prop. 13 also caps property tax rates (other than
voter-approved bond issues or special levies) at 1% of assessed value. These
limits produce a smooth, gradually rising, revenue stream. Without them,
local governments would be lurching from boom to bust.
Continued in article
Deisel fuel tax rates are quite different ---
http://www.sbecouncil.org/uploads/BusinessTaxIndex2008.pdf
Note that states do not tax deisel and gasolene for off-road use such as in farm
tractors. However, this fuel is colored such that drivers who cheat on the road
are subjected to heavy fines if caught with the wrong color in a fuel tank.
The problem is that analysts in general tend to compare average before-tax
salaries and living costs. Although Wisconsin is slightly low in terms of
state-supported university salaries, on an after-tax basis they are very low due
to high taxes in Wisconsin.
Wisconsin's State/Local Tax
Burden Among Nation's Highest in 2007 ---
http://www.taxfoundation.org/research/topic/67.html
During the past three decades Wisconsin's
state and local tax burden has consistently ranked among the nation's
highest. Estimated at 12.3% of income, Wisconsin’s state and local tax
burden percentage ranks 7th highest nationally, well above the national
average of 11.0%. Wisconsin taxpayers pay $4,736 per capita in state and
local taxes, and per capita state income is $38,639.
Wisconsin's State-Local Tax Burden, 1970-Present
On the other hand, some states that also pay lower than average faculty
salaries are winners in terms of letting faculty keep more of their income. For
example, consider Delaware:
Delaware's State/Local Tax
Burden Fourth Lowest in Nation in 2007 ---
http://www.taxfoundation.org/research/topic/18.html
Consistently over the past two decades,
Delaware has had one of the nation’s lowest state and local tax burdens.
Estimated at 8.8% of income, Delaware’s state-local tax burden percentage
ranks 47th highest nationally, well below the national average of 11.0%.
Delaware taxpayers pay $3,804 per-capita in state and local taxes, and per
capita state income is $43,471.
Delaware's State-Local Tax Burden, 1970-present
States like New York, New Jersey, and California that have relatively high
average salaries for their major research universities can be losers in terms of
taxes and real estate costs. Real estate costs in those states are still high
even after the bursting of the sub-prime bubble. High taxes are also bummers in
Maine and Vermont. States like Florida that used to be good deals for taxes and
real estate costs have seen property taxes and insurance costs soar.
You may feed in the name of any state you choose and get state and local tax
burden comparisons ---
http://www.taxfoundation.org/research/topic/18.html
You probably should go to the above site before comparing the average
salaries (by faculty rank) of U.S. colleges and universities (public and
private) that are listed in several sections of Chronicle of Higher
Education, April 18, 2008"
- Page A19: Leading private universities, public universities, community
colleges, and liberal-arts colleges.
- Page A 20: Expanded table and graphs.
- Pages A22-24: More than 1,300 major universities and colleges listed by
each of the 50 states in the U.S. (averages by faculty rank)
If you are attracted to or turned off by the average salaries (by faculty
rank) in a given school, don't forget to compare taxes and real estate costs.
There are also other cost considerations like the cost of private schools in
some urban areas that have low cost or dangerous public schools K-12.
Compare taxes for all 50 states of the U.S. at ---
http://www.taxfoundation.org/research/topic/18.html
Compare the living costs of any two locales in the United States in terms
of how far your salary will go in these to locales (such as where you live now
versus where you might want to move to) ---
Click Here ---
http://snipurl.com/comparelivingcosts
[www_salary_com]
Bob Jensen's threads on Salary Compression, Inversion, and Controversies ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#Salaries
Bob Jensen's tax comparison helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
A Comparative Analysis of State Tax on Business, Tax Foundation, 2012
---
http://www.taxfoundation.org/files/lm_2012_proof_08.pdf
. . .
Table 7 on Page 14
Overall Results
Mature Firms
New Firms
Index Score Rank
Index Score Rank
Alabama
86.0
13
86.4 19
Alaska
97.7.
23
81.1
17
Arizona
86.2
14
114.9
31
Arkansas
102.8
30
69.6
8
California
105.8
34
133.8
45
Colorado
105.4
33
135.1
47
Connecticut
93.9
21
109.3
30
Delaware
98.1
24
80.5
16
Florida
90.6
19
122.8
36
Georgia
71.8
3
66.7
6
Hawaii
142.6.
49.
151.4
50
Idaho
111.7
38
116.0
32
Illinois
126.4
45
94.2
24
Indiana
122.7
43
80.1
15
Iowa
116.5
40
126.8
41
Kansas
133.5
47
141.6
48
Kentucky
88.4
18
69.4
7
Louisiana
84.1
10
52.8
2
Maine
100.4
27
87.3
20
Maryland
82.4
8
134.7
46
Massachusetts
123.6
44
128.2
43
Michigan
98.8
25
96.6
25
Minnesota
112.7
39
119.6
35
Mississippi
109.2
37
89.3
21
Missouri
108.8
36
97.0
26
Montana
93.1
20
93.8
23
Nebraska
82.5
9
31.7
1
Nevada
77.7
4
124.8
38
New Hampshire
99.7
26
91.0
22
New Jersey
121.1
41
104.9
27
New Mexico
97.4
22
80.0
14
New York
121.1
42
124.4
37
North Carolina
80.8
7
79.9
13
North Dakota
87.0
15
83.5
18
Ohio
78.1
5
58.7
3
Oklahoma
87.1
16
65.3
5
Oregon
100.5
28
106.3
28
Pennsylvania
145.1
50
145.9
49
Rhode Island
129.1
46
128.4
44
South Carolina
103.8
32
119.4
34
South Dakota
56.0
2
77.7
11
Tennessee
101.3
29
108.7
29
Texas
85.9
12
127.7
42
Utah
80.2
6
76.7
10
Vermont
103.7
31
79.2
12
Virginia
84.4
11
125.9
39
Washington
87.2
17
126.3
40
West Virginia
140.2
48
118.5
33
Wisconsin
107.7
35
59.8
4
Wyoming
48.3
1
73.3
9
Continued in article
Jensen Comment
Of course there are many other factors to consider when running a business in a
given state. First there are markets to consider. For example Wisconsin and Ohio
look attractive from a tax standpoint but these states are unattractive to labor
intensive business firms because of union power within those states. Such firms
may prefer moving into Alabama, Arkansas, or Mississippi in spite of having to
pay higher taxes. Many firms have moved from New England to the south because of
higher wages and taxes in New England. Taxes and wages have been a disaster for
some states. For example, Hawaii was at one time a thriving grower of
pineapples. Now most of the pineapple growers have moved elsewhere because of
taxes and wages.
Another thing to consider are subsidies to business firms that offset taxes
and wages. For example, when threatened with a huge movements of business firms
out of Illinois (including huge firms like Caterpillar and Sears), Illinois
commenced to offset its high business taxes and wages with business subsidies.
Bob Jensen's threads on taxation are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
Question
As a hobby collector are you evading taxes illegally?
From The Wall Street Journal Accounting Weekly Review on February 22,
2008
If You Collect, the IRS May Collect From You
by
Arden Dale
The Wall Street Journal
Feb 14, 2008
Page: D5
Click here to view the full article on WSJ.com ---
http://online.wsj.com/article/SB120295828908267469.html?mod=djem_jiewr_AC
TOPICS: Personal
Taxation
SUMMARY: This
article discusses implications of gains on collectible
items, such as artwork, automobiles or "Elvis's guns."
"Capital gains, estate and gift taxes may all come into play
depending on whether you decide to sell off parts of the
collection or bequeath it to an heir. Experts advise that
you start by deciding [the taxpayer's] tax status....A
collector, for tax purposes, is one who buys and owns items
primarily for personal pleasure. An investor, on the other
hand, buys chiefly to make a profit. A dealer is in the
business of buying and selling. For the average person, the
big distinction is between collector and investor." The
article goes on to discuss the tax implications of gains on
collectible items.
CLASSROOM
APPLICATION: This article may be used in Personal Tax
classes, Personal Financial Planning classes or Investment
classes to pull together the various possibilities in this
area of taxation. Also, the orientation of the article
allows for combining discussion of three taxation approaches
on collectible items typically covered in different tax
courses.
QUESTIONS:
1.) What is the reasoning behind categorizing a taxpayer as
a collector, an investor or a dealer of collectible items?
2.) What code sections are relevant to the taxability of
gains, deductibility of losses and deductibility of expenses
related to collectible items?
3.) What are the requirements of code section 212? What
actions by a taxpayer would support the notion that code
section 212 is the relevant tax code section to decide on
the tax treatment of expenditures related to collectible
items?
4.) How does the "special 28% capital gains tax" on
collectible items compare to taxes on gains related to other
investments?
5.) How are capital gains and losses accumulated for the
purpose of applying capital gains taxes?
Reviewed By: Judy Beckman, University of Rhode Island
|
"IRS Names Four New Frivolous Claims to Avoid," SmartPros, January 15,
2008 ---
http://accounting.smartpros.com/x60395.xml
The four
new frivolous claims pertain to the following:
- Misinterpretation of the 9th Amendment
to the U.S. Constitution regarding objections to military
spending.
- Erroneous claims that taxes are owed
only by persons with a fiduciary relationship to the United
States or the IRS.
- A nonexistent "Mariner's Tax
Deduction" (or the like) related to invalid deductions for
meals.
- Certain instances of misuse or
excessive use of the section 6421 fuels credit.
An individual or group may not avoid paying
their fair share of taxes by making "frivolous" legal arguments. The
IRS publicizes these frivolous claims to help taxpayers understand
the law and avoid penalties.
Continued in article |
Question
Does it pay to evade taxes and, if so, why don't more people do it?
"Why so Little Tax Evasion? Nobel Laureate Gary Becker, The Becker-Posner
Blog, November 25, 2007 ---
http://www.becker-posner-blog.com/
All the rich countries are successful in raising
sizable amounts of revenue from taxes with only a rather little tax evasion.
Tax avoidance is the use of legal means to reduce taxes, whereas tax evasion
uses illegal means. The federal government of the US raises almost 20
percent of American GDP through taxes on personal and business income,
capital gains, estates, and the sale of gasoline and some other goods. The
estimates from the 2001 IRS National Research Program indicate that the
percent of income not reported is quite low for wages and salaries, but
rises to over 50 percent for farm income, and about 40 percent for business
income. Income tax payments overall are under reported by about 13 percent.
What determines the degree of tax evasion?
If taxpayers responded only to the expected cost of
evading taxes, evasion would be far more widespread. The reason is that only
about 7 percent of all tax returns are audited (over a 7 year period), and
typically the penalty on under reported income is only about 20 percent of
the taxes owed. Virtually no one is sent to jail simply for evading taxes
unless that evasion is on a very large scale, or involves massive fraud. If
a person were to evade $1,000 in taxes, his expected gain would be
0.93x$1000 -0.07x$200 (=$1000/5) = $916. On these considerations alone, he
should not hesitate to evade paying the $1,000, and presumably much more.
To be sure, the expected gain is not the right
criterion since most taxpayers would be risk averse regarding audits and
punishments, especially if there is some chance of much greater than the
average punishment or likelihood of an audit. However, if the expected gain
from evading $1,000 were $916, the degree of risk aversion would have to be
huge, far higher than the risk aversion that is embodied in pricing of
assets, for risk to explain why there is so little tax evasion.
This is not to say that possible punishments have
no affect on the amount of tax evasion. Compliance rates are much higher
when governments have independent evidence on a person's income since then
the probability of audit when he under reports his income is much higher
than when they do not have this information. For example, income from
independent consulting to companies is better reported than tips on
earnings, or than the incomes of farmers and other small business owners
because employers report how much they paid to independent consultants,
whereas no one reports how much they paid in tips, or how much they bought
from a local store. A PhD study in progress at the University of Chicago by
Oscar Vela also shows that persons in occupations where integrity is a more
important determinant of success, such as law or medicine, are less likely
to evade taxes. Presumably, any publicity that an individual in these
occupations was convicted of tax evasion would damage his reputation and
earnings.
Vela finds that considerations of reputation, along
with more traditional variables in the tax evasion literature do help
explain how much evasion occurs for different types of income. These
variables include the likelihood of audits that varies for different classes
of taxpayers, punishments for those audited, marital status (not
surprisingly, married persons are less likely to evade taxes), the marginal
tax rate, and the ease with which governments can match reported incomes
with independent evidence on incomes, such as from 1040 and 1099 tax forms,
Note that tax avoidance as well as tax evasion
tends to rise as the marginal tax rate increases. That is, with higher tax
rates, individuals and businesses are both more likely not to report some of
their income to the tax authorities, and also to search harder for ways to
reduce how much of their income they are obligated to report. This implies,
for example, that flattening the income tax structure would increase the
amount of personal income reported to tax authorities because both the
amount of evasion and the avoidance of the personal income tax would be
reduced.
However, audits, punishments, and the other
deterrence variables mentioned in the previous paragraphs do not fully
explain why there is not much more tax evasion. I believe it is necessary to
recognize that most people believe they have a duty, moral or otherwise, to
report their taxable income more or less honestly. I intentionally say "more
or less honestly" because a little cheating on taxes is usually considered
to be ok, as long as it does not go too far. Individuals might not pay
social security taxes on their payments to workers who clean their houses,
and they might pay a mason in cash because he then gives them a lower price,
but these same persons would be very reluctant to engage in large-scale tax
evasion.
Similarly, most people do not believe it is moral
to steal money even when there is little chance they will be found out, and
they feel obligated to obey many other laws, even when that entails
inconvenience and cost to themselves. There would be considerably more crime
if individuals only obeyed laws when the expected cost of being caught,
adjusted for risk, exceeded the benefits from disobeying these laws. To some
extent, people obey many laws, including tax laws, because most other
persons are doing the same. If so, their behavior might change radically if
they lost confidence that others would pay their taxes and obey other laws.
Clearly, morality about obeying laws does not apply
to all types of taxes, or all laws-people often cross a street when the
light is red, do not stop at stop signs when riding their bikes, and do not
report much of their tips. Moreover, in many countries of Latin America,
Africa, and Russia and other parts of Eastern Europe, individuals do not
even feel much obligation to pay ordinary income and other taxes. They evade
except when they expect the chances of being caught are high, as with
businesses paying value added taxes. These countries are unable to raise
substantial amounts from taxes on personal incomes or businesses except when
marginal tax rates are low. Instead they rely greatly on value added and
other more difficult to evade taxes.
"Why so Little Tax Evasion? Richard Posner, The Becker-Posner Blog,
November 25, 2007 ---
http://www.becker-posner-blog.com/
Becker presents persuasive evidence that the amount
of tax evasion varies, as one would expect in a rational-choice model of
taxpaying, with variance in the private costs and private benefits of
evasion. I am inclined to believe that the private costs are higher than he
suggests, which if true would mean that more tax compliance can be
attributed to rational fear of punishment than he suggests and less to
taxpayers' feeling a moral duty to pay taxes. For example, the civil
penalties for tax evasion are quite severe (the fraud penalty is 100 percent
of the amount of taxes evaded), and anyone charged with civil or criminal
tax evasion will incur heavy legal and accounting expenses in defending
against the charge. Although the audit rate is low, it is not random, but
rather is higher for those taxpayers who are in the best position to evade
taxes without being caught or whose tax returns raise a red flag because of
unusually high deductions or other suspicious circumstances. And once one
has been caught evading taxes, one can expect the rate of future audits of
one's returns to be high. While it is true that underpayment of taxes is
rarely prosecuted criminally, even when deliberate, criminal prosecution is
likely if the tax evader takes steps to conceal the evasion, as by never
filing a tax return, keeping phony books, or forging evidence of deductions.
Moreover, the government does occasionally prosecute even small fry.
. . .
The general question that Becker raises of the
moral costs of committing crime is a fascinating one. I would be inclined to
search as hard as possible for nonmoral costs before concluding that
morality is a major motivator of behavior, especially with regard to crimes,
like tax evasion, that do not have an identifiable victim. In the case of
many crimes, the benefits to most people of perpetrating them would be so
slight (and often zero or even negative) that sanctions play only a small
role in bringing about compliance; enforcement costs needn't be high in
order to deter when nonenforcement benefits are low. Some examples: the
demand for crack cocaine among white people (including cocaine addicts)
appears to be very small. Both altruism and fear deter most people from
attempting crimes of violence, quite apart from expected punishment costs.
The vast majority of men do not have a sexual interest in prepubescent
children. Well-to-do people often have excellent substitutes for crime: any
person of means can procure legal substitutes for illegal drugs (for
example, Prozac for cocaine, Valium for heroin). Fear of injury deters most
people from driving recklessly or while drunk. People who have no taxable
income are incapable of evading income tax. People who do have taxable
income can obtain benefits from evading it, but the costs of evasion are, as
I have emphasized, nonnegligible, so there is widespread compliance along
with a good deal of evasion. I would therefore expect differences across
countries in tax evasion to be related more to differences in penalties,
collection methods, and so forth than to differences in morality. Americans
may exhibit higher tax compliance than Italians, but Americans are not a
more moral people than Italians.
Continued in article
Jensen Comment
I inclined to think that more people evade taxes than Becker and Posner suggest,
although this evasion has declined due to added reporting of revenues,
particularly 1099 forms for miscellaneous income. In the United States, the IRS
estimated in 2007 that Americans owed $345 billion more than they paid, or about
14% of federal revenues for FY2007. But these estimates are very soft numbers
based largely on intense audits of a miniscule proportion of taxpayers filing
returns ---
http://en.wikipedia.org/wiki/Tax_Evasion
You can learn a lot about taxation at
http://en.wikipedia.org/wiki/Tax
Also see
http://en.wikipedia.org/wiki/Income_tax
Although a lot (OK most) people disagree with me, I've been a long-time
advocate of replacing the U.S. corporate income tax with a VAT tax
"US VAT Introduction versus the Proposed Changes of The ‘European Union’
VAT System," by Richard Cornelisse, Big Four Blog, March 24, 2012 ---
http://www.big4.com/ernst-young/us-vat-introduction-versus-the-proposed-changes-of-the-european-union-vat-system
Questions
How can the IRS tax earnings for services not rendered?
My second question concerns the annual limit on wages (that just moved up to
$102,000) subject to Social Security taxes. Suppose a professor received an
academic year salary of $150,000 in 2008 plus a tenure buyout of $300,000 for
early retirement at age 56 (actually there's no obligation to retire before
reaching 100 years of age or later). If her/his "wages" aggregate to $450,000
wouldn't the Social Security tax still be limited to the first $102,000?
"University Owes Social Security Taxes for Tenured-Faculty Buyouts, Court
Says," by Goldie Blumenstyk, The Chronicle of Higher Education, November
5, 2007 ---
Click Here
A federal appeals court has ruled against the
University of Pittsburgh’s argument that buyout payments to tenured
professors who take early retirement are not subject to Social Security
taxes. The court, in a 2-to-1 ruling, said the payments are taxable.
The ruling centered heavily on the judges’
interpretation of tenure.
The university had contended that such payments
were not taxable as “wages” because they were given in exchange for the
professors’ relinquishing their tenure rights. Pitt sought a refund for the
$2-million in taxes that it paid from 1996 to 2001.
But the Internal Revenue Service denied that
request, and when the university sued, a U.S. district-court judge, Donetta
Ambrose, ruled for the university as a matter of law. The federal government
appealed that decision, paving the way for the ruling last week in which a
three-judge panel of the U.S. Court of Appeals for the Third Circuit sided
with the government.
“Because tenure is a form of compensation for past
services to the university, payments offered as a substitute for tenure are
compensation and therefore taxable as wages,” two of the judges said in the
majority opinion.
In a dissent, Judge Anthony J. Scirica disagreed
with the interpretation of tenure as merely a version of seniority but,
rather, as the second part of an employment relationship with its own
rights. As such, said Judge Scirica, “payments for the relinquishment of
property right in tenure at the university were not remuneration for
employment and were not subject” to taxation.
As the opinion notes, the case marked the third
time that a federal appeals court had taken up the question since 2001. In
one instance the court found that such payments were taxable, and in
another, that they were not.
Bob Jensen's taxation helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
From The Wall Street Journal Accounting Weekly Review on March 9, 2007
Reviewed By: Judy Beckman, University of Rhode Island
What to Know When Choosing a Tax Preparer
by Tom
Herman The Wall Street Journal Mar 07, 2007 Page: D1
Click here to view the full article on WSJ.com
TOPICS: Accounting, Code of
Ethics, Code of Professional Conduct, Income Taxes, Personal
Taxation, Public Accounting
SUMMARY: The article describes
tax preparation alternatives and can be used in a personal
income tax course to prepare students for professional life,
particularly in offering tax services. One former IRS
official estimates that there are 1.2 million to 1.6 million
tax practitioners in the country, though no one is certain
of the total. A box highlights tax preparation alternatives,
listing CPAs third along with tax-preparation software,
chains such as H&R Block, and enrolled IRS agents. The
article describes some unscrupulous tax preparation
practices, particularly since "concern about paid preparers
escalated last year after the U.S. Government Accountability
Office found significant mistakes--and even some
cheating--by workers at a few major tax-preparation firms."
The data on problems in paid preparers' work leads the
article, though ensuing paragraphs advise taxpayers with
lower incomes and less complex tax situations to consider
free or purchased tax software and "higher-income taxpayers
with far more complex tax questions [to] consider looking
for an enrolled agent, an accountant or another expert with
extensive training."
QUESTIONS: 1.) Do you think this article is helpful to CPAs providing
services to identify the benefits of a paid preparers'
services? What are the positive aspects of the article for
this purpose? What are the negative aspects?
2.) Must an individual be a CPA to sign as a paid preparer
for a tax return? Does the IRS hold any requirements for an
individual to fill that role?
3.) What are the problems with returns by paid preparers
uncovered in work by the General Accountability Office (GAO)
in relation to 2005 tax return filings? Why do you think the
GAO undertook this investigative work?
4.) Does the IRS have any provisions to penalize paid
preparers for errors or other improprieties in their work?
Explain.
5.) How does the American Institute of CPA's (AICPA's) Code
of Professional Conduct address the issues with improper tax
returns discussed in this article? What is the consequence
to a CPA for violating this code?
6.) How do paid preparers structure fees to clients for tax
preparation services? Why do you think these differences
exist? List all factors you can think of and specifically
refer to requirements based on a CPA's code of professional
conduct. |
"(Tax) Abusive Insurance and
Retirement Plans : Single–employer section 419 welfare benefit plans are
the latest incarnation in insurance deductions the IRS deems abusive," by
Lance Wallach, Journal of Accountancy, October 2006 ---
http://www.aicpa.org/pubs/jofa/sep2008/abusive_insurance.htm
Some of the listed transactions
CPA tax practitioners are most
likely to encounter are employee benefit
insurance plans that the IRS has deemed
abusive. Many of these plans have been
sold by promoters in conjunction with
life insurance companies.
As long ago as 1984,
with the addition of IRC §§ 419 and
419A, Congress and the IRS took aim at
unduly accelerated deductions and other
perceived abuses. More recently, with
guidance and a ruling issued in fall
2007, the Service declared as abusive
certain trust arrangements involving
cash-value life insurance and providing
post-retirement medical and life
insurance benefits.
The new "more likely than not"
penalty standard for tax
preparers under IRC § 6694 raises the
stakes for CPAs whose clients may have
maintained or participated in such a
plan. Failure to disclose a listed
transaction carries particularly severe
potential penalties.
Lance
Wallach,
CLU, ChFC, CIMC, is the author of the
AICPA’s The
Team Approach to Tax, Financial and
Estate Planning.
He can be reached at
lawallach@aol.com or on the Web at,
www.vebaplan.com or 516-938-5007.
The information in this article is not
intended as accounting, legal, financial
or any other type of advice for any
specific individual or other entity. You
should consult an appropriate
professional for such advice.
|
|
From the IRS Site
If you earned $54,000 or less in 2007, you can use Free File to prepare your
taxes online beginning in mid-January 2008 right here at the IRS website.
---
http://www.irs.gov/efile/article/0,,id=118986,00.html
e-file Using a Computer
IRS e-file is the fastest most accurate way to file
your taxes.
Filing your federal tax return using IRS e-file is
easier and more convenient than ever before! Most taxpayers can use this
program. Access to a personal computer and the Internet is necessary to
conveniently, quickly and safely transmit your return and receive proof of
acknowledgement. You decide the manner of tax preparation to quickly and
conveniently e-file your Form 1040, Form 1040A, Form 1040EZ or Form 1040SS
(PR) using a personal computer. You can:
• Purchase commercially available software from
a retailer,
• Download software from an Internet site and prepare your return
offline, or
• Prepare and file your return online.
NOTE: IRS cannot compete with private enterprise
and does not offer free e-file software or direct filing. A number of
companies, tested and approved by the IRS, do offer free use of their
software and free filing, while others will charge nominal fees. Terms and
conditions vary among companies and you are advised to review the
information on each company's web site and choose the product that is right
for you.
Anyway you choose, it's a simple process. As
always, IRS e-file means a more accurate return, fast refunds - in half the
time compared to filing a paper return - and even faster and safer with
Direct Deposit! IRS e-file also offers the convenience of filing your tax
return early and delaying payment up until the due date.
You can choose to file a completely paperless tax
return by using a Self-Select PIN as your signature. With a Self-Select PIN,
there is no paper signature document to send in!
And don't forget, in 37 states and in the District
of Columbia you can simultaneously e-file your Federal and state tax
returns. Your personal computer and IRS e-file does it all!
NOTE: Prior Year 1040 series returns may not be
filed electronically.
Continued in article ---
http://www.irs.gov/efile/article/0,,id=98294,00.html
Tax Cut Only Provides Free Online Preparation (Federal Only) for Taxpayers
Earning Less Than $52,000 ---
http://www.hrblock.com/taxes/partner/index.jsp?otpPartnerId=180
Others must pay --- http://www.taxcut.com/
Turbo Tax Appears More Generous for "Simple" Federal Returns ---
Click Here
"Tax-Prep Software Doesn't Add Up," by Rob Pegoraro, The Washington
Post, March 12. 2005 ---
Click Here
I knew I was doomed about five
minutes into this year's tax-prep ordeal. Two different programs -- having
been fed nothing more than basic personal info and the contents of a pair of
W-2s -- did not agree on the total tax bill for my wife and me.
H&R Block's TaxCut Online and Intuit's TurboTax
Online should have coughed up identical responses to such a simple input,
but instead they were $857 apart.
Sadly, I wasn't surprised to see the two dominant
home tax-preparation programs disagree, merely disappointed to see them part
company so quickly. I have long since abandoned all hope of understanding
how these applications compute my tax bill; I just want to know which one
can end the agony first.
When judged on those limited criteria,
tax-preparation software has improved a little -- especially the Web-based
versions that most people use, which need no software installation, securely
encrypt work online and are free for simple returns. Others can try them for
free, then pay to print or file (or, at no cost, copy data from them into
the IRS's
new, free Web-filing system).
This year, I tried roughly comparable Web
applications: Block's $19.95 TaxCut Online Basic and Intuit's $29.95
TurboTax Online Deluxe. Each worked in Internet Explorer 7 and Firefox 3 in
Windows; Safari 3 on a Mac. Intuit supports Windows 2000 or newer and Mac OS
X 10.2 or newer, while Block only allows Win XP or Vista and OS X 10.3 or
newer.
After some long nights of plugging in numbers for
two salaries, a little freelance income, multiple bank accounts and
investments, a mortgage and too many other details, TurboTax left me with a
slightly higher tax bill than TaxCut. And yet I felt more comfortable with
TurboTax's estimate and less annoyed by its performance.
That's partially because TurboTax required less
work. While both Web applications could import tax-prep files saved by
2008-vintage desktop programs, TaxCut kept asking me to type in information
it should have pulled from that file, such as names of mutual funds.
TurboTax can download tax-return data from many
employers and brokerages. It also linked to Intuit's ItsDeductible site for
quick estimates of in-kind charitable donations (if you don't need that
feature, get the $14.95 TurboTax Basic edition that Intuit doesn't list on
its home page). Block doesn't offer its comparable DeductionPro service to
any of its TaxCut Online users.
That oversight wasn't TaxCut's only unforced error.
It demanded too much scrolling up and down and clicking through consecutive
screens to enter data on one form. And when I left a field blank instead of
typing a zero -- a common occasion with investments, thanks to all the
flavors of capital gains the tax code serves up -- the site scolded me to
finish the form.
Other TaxCut issues went beyond mere aesthetics.
Its Web version lacks important features available in the disc-based
edition, like the ability to inspect the 1040 form the program is creating,
then save an offline copy of your data. It also omits such lesser-known
options as the tax credit for first-time homebuyers in the District.
And if you decide you'd rather not use TaxCut,
there's no one-click way to wipe your data from the site.
TaxCut does include the extra-cost option of a
consultation with one of Block's own tax advisors. But you have to put up
with a lot of aggravation first.
Intuit's pricier program
offered its own annoyances. It kept asking questions only an accountant
could answer, such as the chunk of a mutual fund's dividends subject to
foreign tax -- a detail absent from the fund's 1099 form.
At other times, TurboTax's overall edge in
efficiency vanished, like its plodding tour of deductions and credits
repeatedly held up by a prompt to "Find More Deductions," or its clumsy
method of recording cash donations to charity.
TurboTax, however, allowed more confidence in its
numbers by showing more of its work. I could click the running total in the
top-right corner to see a summary of the factors behind that number, with my
1040-in-progress another click away. At the end of the process, a
semi-plain-English explanation added context.
But both of these programs, along with every other
tax-prep application I've tried, too often fail to explain why we must
subject ourselves to these contortions.
The tax code represents the single worst interface
-- bloated, inefficient, unreadable, unreliable, downright grotesque -- I
have ever seen. And to what end? We try to reward good behavior and punish
bad conduct with all these cryptic little rules, but how can people
Along the way, we've corrupted a basic obligation
of citizenship -- paying the cost of civilization -- into a Kafkaesque game
that only lawyers, lobbyists and accountants seem capable of winning.
I would like to see tax-prep applications deal with
this misery more effectively. But I would rather see them made obsolete by a
tax code that people can understand and follow without any extra software.
January 4, 2007 reply from John Stancil
[jstancil@VERIZON.NET]
TaxACT (
www.taxact.com )
has its standard 1040 product free for download. The
deluxe is $12.95 and the ultimate (which includes stat) is $19.95. The
standard only allows one return, with the others you can do multiple
returns. E-file is free.
John Stancil
IRS Homepage (The best U.S. Government agency web site
on the Internet)
http://www.irs.gov/
IRS Site Map ---
http://www.irs.gov/sitemap/index.html
FAQs and answers ---
http://www.irs.gov/faqs/index.html
IRS Tax Interactive
http://www.irs.gov/individuals/page/0,,id%3D15552,00.html
The IRS youth education web site on taxation (an IRS joint development
project with the American Bar Association)
http://www.irs.ustreas.gov/prod/taxi/abouttaxi.html
Taxpayer Advocate Service ---
http://www.irs.gov/advocate/index.html
Will you get hit by the Alternative Minimum Tax?
The AMT Assistant from the IRS ---
http://apps.irs.gov/app/amt/
The IRS tells you how to get in trouble with the IRS ---
http://www.aicpa.org/pubs/jofa/sep2006/tax_ex1.htm
"Comparing Tax Prep Software," AccountingWeb, February 5, 2006 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=101747
There are five tax
preparation software packages that we can compare and contrast. They
are:
- Intuit’s TurboTax®
- H&R Block’s TaxCut®
- 2nd Story Software’s
TaxACT®
- PEI’s TaxBrain
- CCH’s CompleteTax® and
CompleteTax Pro(TM)
TurboTax
provides a customized tax
interview to help automate the preparation of your federal and state
return, according to Intuit. They guarantee your return to be 100
percent accurate. Your return is double checked for errors and
omissions and life events prompts are provided. You can transfer
data from year to year and import data from TurboTax, Quicken(R),
Quickbooks(R), Microsoft Money(R), or Intuit ItsDeductible(R).
Basic, Deluxe, Premier level software packages are offered.
Preparation is also available using TurboTax Online covering the
same three levels. You get a single downloadable state product with
Deluxe and Premier TurboTax products. You also receive ItsDeductible
with Deluxe and Premier TurboTax products.
Intuit is offering to increase the size of your $1,000 refund by
$200, or more, in gift cards from over 50 popular retailers
including Lowe’s, AMC Theaters, and Dell, according to TurboTax.
Learn more about this offer at
http://www.turbotax.com/refund_bonus/.
If
your return is audited, TurboTax has partnered with TaxResources,
Inc. (TRI) to provide customers with TurboTax Audit Defense. This
service can only be purchased through TurboTax software or TurboTax
for the Web through October 16, 2006. Starting October 17th,
customers should visit
http://intuit.taxaudit.com
if they would
like to purchase Audit Defense, according to TurboTax. This service
must be purchased prior to receiving a notice of audit.
TaxCut(R)
offers one state product free
with Deluxe and Premium TaxCut products. H&R Block guarantees your
return to be 100 percent accurate. Any errors and omissions are
double checked as you proceed through your customized interview.
Life events advice is also provided. You can transfer data from year
to year and import data from TaxCut, TurboTax, Quicken, MS Money,
H&R Block Deduction Pro(R), or Intuit ItsDeductible. Audit
Support(TM) is there for you if your federal or state return is
audited, according to H&R Block.
You could
double the amount of your federal refund with the Double Your Refund
Instant Win Game just by filing your taxes with H&R Block. Enter one
of three ways: have your taxes prepared at a participating tax
office, use one of our online tax programs, or obtain a game card
without purchase by mail, according to H&R Block.
TaxACT(R)
provides personal and professional tax products. They offer
Standard, Deluxe, and Deluxe with State bundles, according to TaxACT.
Free e-filing is available with each individual and state return
prepared online. Taxpayers can download the TaxACT software or order
the CD at extra cost or use the low-priced online option. Each
option has Standard, Deluxe, and Ultimate bundles with stepped
pricing and features. Any errors and omissions are double checked by
the program. Life events guidance is also provided.
TaxBrain
is an online tax preparation service that replaces the return-long
interview process with a single questionnaire. Appropriate input
sheets are selected by the program based on the short questionnaire,
according to PEI. A Personalized Organizer is provided to help the
taxpayer put together all the necessary paperwork. The program
validates every entry and flags potential audit items and tax-saving
opportunities while the federal and state individual return is
prepared. TaxBrain also provides expanded Schedule C support for
small businesses.
Each
TaxBrain client builds a personalized tax profile stored on a
customized page that can be used to manage taxes into the future.
Filings can be managed and tax payments can be made from this page,
according to TaxBrain. TaxBrain Online is always available for
taxpayer assistance. SmartCoverage(TM) Audit Defense provides
representation if your federal or state return is audited.
CompleteTax(TM)
is CCH’s entry in the tax preparation arena.
You can take advantage of an online chat service there, according to
CCH. The CCH Online Tax Guide, and the Ernst & Young Tax Guide, are
also available, as well as a financial calculator and a tax
projector. You can also check on the status of your e-file.
CompleteTax Pro(TM) is a professional affiliate program providing an
online individual tax preparation system with Standard and Private
Label service options, according to CCH. Customers can prepare and
process their own returns for $24.95 using the Standard service
option. The Private Label version allows firms to create their own
brand name for the CompleteTax Pro(TM)-based program. Learn more
about CompleteTax Pro(TM) at
tax.cchgroup.com/completetaxpro.
Not only are chains (e.g., H&R Block) allowed to sell some of your
private information, they are also allowed to charge you hidden fees and
pressure you to buy products you don't need. My advice is to either obtain
tax preparation software and do your own taxes or go to a CPA
"Beware of hidden fees for tax preparation: Federal report
finds major chains charge for unnecessary extra services," by Lea
Thompson, MSNBC News, April 4, 2006 ---
http://www.msnbc.msn.com/id/12156097/
(This link was forwarded by Robert Bowers)
More than 60 percent of Americans pay for
tax preparation. Paid tax preparers do 78 million returns. Monday,
NBC News showed you how some tax preparers at the nation's biggest
chains have been cheating the government in order to get their
clients bigger refunds. But NBC’s hidden camera investigation also
found some of those same preparers are quick to sell clients
questionable financial products they may not need.
The problems government investigators found
with the nation's largest tax preparers were widespread, including
high rates for instant refunds and fees you might not expect to pay.
“Frankly, I was amazed at the degree of
incompetence and unprofessionalism,” says Sen. Max Baucus, D-Mont.
"IRS Plans to Allow
Preparers to Sell Data," SmartPros, March 22, 2006 ---
http://accounting.smartpros.com/x52297.xml
The IRS is quietly moving to loosen the once-inviolable
privacy of federal income-tax returns. If it succeeds,
accountants and other tax-return preparers will be able to
sell information from individual returns - or even entire
returns - to marketers and data brokers.
The change is raising alarm among consumer and
privacy-rights advocates. It was included in a set of
proposed rules that the Treasury Department and the IRS
published in the Dec. 8 Federal Register, where the official
notice labeled them "not a significant regulatory action."
IRS officials portray the changes as housecleaning to
update outmoded regulations adopted before it began
accepting returns electronically. The proposed rules, which
would become effective 30 days after a final version is
published, would require a tax preparer to obtain written
consent before selling tax information.
Critics call the changes a dangerous breach in personal
and financial privacy. They say the requirement for signed
consent would prove meaningless for many taxpayers,
especially those hurriedly reviewing stacks of documents
before a filing deadline.
"The normal interaction is that the taxpayer just signs
what the tax preparer puts in front of them," said Jean Ann
Fox of the Consumer Federation of America, one of several
groups fighting the changes. "They think, 'This person is a
tax professional, and I'm going to rely on them.' "
Criticism also came from U.S. Sen. Barack Obama (D.,
Ill.). In a letter last Tuesday to IRS Commissioner Mark
Everson, Obama warned that once in the hands of third
parties, tax information could be resold and handled under
even looser rules than the IRS sets, increasing consumers'
vulnerability to identity theft and other risks.
"There is no more sensitive information than a taxpayer's
return, and the IRS's proposal to allow these returns to be
sold to third-party marketers and database brokers is deeply
troubling," Obama wrote.
The IRS first announced the proposal in a news release
the day before the official notice was published, headlined:
"IRS Issues Proposed Regulations to Safeguard Taxpayer
Information."
The announcement did not mention potential sales of tax
information. It said the proposed rules were guided by the
principle "that tax return preparers may not disclose or use
tax return information for purposes other than tax return
preparation without the knowing, informed and voluntary
consent of the taxpayer."
Bob Jensen's taxation helpers (including links to tax preparation
software) are at
http://faculty.trinity.edu/rjensen/bookbob1.htm#010304Taxation
Questions
Is it wise to advise older widows, widowers, and divorcees to live in sin?
Answer: Probably Yes!
"Senior Marriage Penalty," AccountingWeb, February 8, 2006 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=101758
“It’s galling that they have a marriage
penalty for seniors, when they’ve addressed it for everyone else,”
Lonell Spencer, a 77-year-old retiree from Arcadia, Connecticut,
told the Hartford Courant. The penalty he’s referring to is the tax
on Social Security income, which applies to every dollar of income
over $32,000 for married couples, compared to $25,000 for a single
taxpayer. Recent efforts to eliminate marriage penalties for most
married taxpayers have not significantly affected married seniors
because the taxable income threshold is only slightly higher for
couples than it is for singles. Further, the median family income
for those over 50 is $35,200, according to AARP’s annual report, The
State of 50+ America, indicating that more than half the families
would be subject to the Social security income tax if one or more
family members are receiving Social Security benefits.
For nearly 50 years, Social Security
benefits were tax-free; then in 1983 the rules were changed because
the Social Security system was underfunded. Since then, while
inflation adjustments have more than doubled the standard deduction
and personal exemption write-offs, the tax on income from Social
Security benefits has not been adjusted for inflation. If it had
been, the Hartford Courant reports, then the threshold would be
$50,000. Instead, the tax actually begins accelerating at $44,000
for married couples. According to The State of 50+ America,the real
income of those over 50 has not increased since 1999. In fact, real
income for 2004, the last period for which The State of 50+ America
collected data, is actually lower than the real income levels of
1999.
The issue is not just about taxing Social
Security benefits. The law was intended to tax “high income”
taxpayers but increasingly affects middle-income seniors, the Fresno
Bee reports. The State of 50+ America found that more than half the
income of 50.1 percent of Americans over 62 comes from sources other
than Social Security. In addition, the financial assets of those
over 65, adjusted for inflation, increased by 94 percent between
1992 and 2004, and more Americans over 50 are employed, The State of
50+ America reports.
Unlike other “marriage penalties,” the
senior marriage penalty has not received much attention. That is
likely to change as baby boomers reach retirement age and get caught
by the tax, Mark Luscombe, principal tax analyst for CCH, a Wolters
Kluwer company, told the Fresno Bee. A search of the AARP web site
however, indicates that either the issue has not yet become a
significant issue to boomers or that it has not been incorporated
into the organization’s lobbying efforts to date.
There are property taxes and then their are total state taxes
How does your state rank in terms of property taxes?
"NY, NJ pay highest property taxes: study," by Anastasija Johnson,
Reuters, September 12, 2007 ---
Click Here
New Jersey and New York state residents
paid the highest property taxes in the country in 2006, as much as
$6,500 more than the national median, according to a report released
on Wednesday.
Hunterdon County, New Jersey, about a
55-mile (89-km) drive from New York City, replaced Westchester
County, New York, on top of the list of 10 counties with the highest
median real estate taxes, the Tax Foundation, a nonpartisan tax
research group, said in the report.
Median real estate taxes for Hunterdon
County totaled $7,999, followed by the $7,706 bill paid by
homeowners in Nassau County, Long Island's western half.
Third on the list was Westchester County,
which is just north of New York City. Its residents paid $7,626,
according to the report by the Washington, D.C.-based group.
Nationally, the median homeowner property
tax was $1,541.
In New Jersey, the median value of a home
was $366,600. New York's median home value was $303,400.
By this measure, both states were far
eclipsed by California, whose median home value was $535,700, the
nation's highest. However, in California the median property tax was
just $2,510.
All of the other seven counties with
highest median real estate taxes were also either in New York or New
Jersey.
The rankings were based on the latest data
for 2006 from the U.S. Census Bureau in its American Community
Survey, the Tax Foundation said.
"The story for the states is much the same
as for the top counties: the Northeast area of the country has the
highest property taxes, along with pockets elsewhere, such as
Wisconsin, Texas, and Illinois," the research group said.
Texas has passed property tax reform since
the data was tallied, it added.
When the states were looked at, instead of
just counties, New Jersey led the list of the top five, followed by
New Hampshire, Connecticut, New York and Massachusetts.
"These states also have high per capita
income, and the highest property tax bills, in terms of dollar
amounts, are usually found in the areas with the highest incomes,"
the study said.
Arkansas, Mississippi, West Virginia,
Alabama and Louisiana had the lowest median property taxes in 2006.
New Jersey's statewide median real estate
taxes were $5,773, while Louisiana's stood at only $179.
The study also looked at median real estate
taxes as a percentage of median home value. In this regard, nine of
the top 10 counties were in New York, with one Texas county also
making the list, the research group said.
Total State Tax Burdens
Tax Foundation Data ---
http://www.taxfoundation.org/research/topic/9.html
State-by-State Rankings in 2007 ---
http://www.taxfoundation.org/research/topic/9.html
Tax Foundation Facts & Figures (Free) ---
http://taxfoundation.org/files/ff2012.pdf
Some Interesting State Comparisons on State& Local Taxation, Business
Climate, and Debt Per Capita
http://www.cs.trinity.edu/~rjensen/temp/StateComparisons2012.htm
When it comes to rankings with respect to per capita total taxation,
there are more disputes as to what taxes to include and exclude. One
listing of such taxes and results state by state as of January 2007 is
at
http://www.retirementliving.com/RLtaxes.html
States are listed
alphabetically in three sections:
Alabama-Iowa,
Kansas-New Mexico,
New York-Wyoming
Many people planning to retire use the
presence or absence of a state income tax as a litmus test for a
retirement destination. This is a serious miscalculation since
higher sales and property taxes can more than offset the lack of a
state income tax. The lack of a state income tax doesn’t necessarily
ensure a low total tax burden.
States raise revenue in many ways
including sales taxes, excise taxes, license taxes, income taxes,
intangible taxes, property taxes, estate taxes and inheritance
taxes. Depending on where you live, you may end up paying all of
them or just a few.
This section of our Web site provides
you with information on state income taxes, sales and fuel taxes,
taxes on retirement income, property taxes and inheritance and
estate taxes. as well as sales and fuel taxes. It is intended to
give you some insight into which states may offer a lower cost of
living. To check out the state where you want to retire, just
select from the state menu above.
State Sales Tax
All states except Alaska, Delaware, Montana, New Hampshire
and Oregon, collect sales taxes. Some have a single rate
throughout the state though most permit local additions to the base
tax rate. Those states with a single rate include Connecticut,
Hawaii, Indiana, Kentucky, Maine, Maryland, Massachusetts, Michigan,
Mississippi, New Jersey, Rhode Island, Vermont, Virginia, and West
Virginia.
States with the highest sales tax are:
California (7.25%), Mississippi (7.0%), New Jersey (7.0%), Tennessee
(7.0%), Rhode Island (7.0%), Minnesota (6.5%), Nevada (6.5%), and
Washington (6.5%). Many cities and counties have the option of
imposing an additional local option sales tax. For instance, in
Tennessee some cities add as much as 2.75%. Nevada's sales tax
varies by county and can be as high as 7.75%.
Most states exempt prescription drugs
from sales taxes. Some also exempt food and clothing purchases and a
few also exempt non-prescription drugs.
Fuel Tax
Every state collects excise taxes on gasoline, diesel fuel and
gasohol. The figures shown for each state reflect only the amounts
controlled by the states and do not include additional taxes imposed
on motor carriers. However, they do include other taxes paid at the
pump by consumers. Where applicable they include sales taxes, gross
receipts taxes, oil inspection fees, underground storage tank fees
and other miscellaneous environmental fees. They do not include the
federal excise tax which is 18.4 cents for gasoline and 24.4 cents
for diesel fuel.
Nine states permit cities or counties
to impose a local tax on fuel. Taxes in some states can also vary
based on the wholesale price which is adjusted quarterly.
Cigarette Tax
Several states are continuing to raise excise taxes on cigarettes
and other tobacco products in order to increase revenue. The rates
shown do not include the federal cigarette tax of 39 cents a pack.
Chicago is the most expensive place to buy cigarettes. When you add
the city tax, the Cook County tax and the state tax, the total is
$3.66 per pack. Evanston and Cicero (Illinois) also have city and
Cook county taxes. The top five states with the highest state tax
on cigarettes are: New Jersey ($2.58), Rhode Island ($2.46),
Washington ($2.025), tied for fourth place are Arizona, Maine,
Michigan ($2.00), and fifth is Alaska ($1.80). Counties and cities
may impose an additional tax ranging from 1 cent to $2.00 on a pack
of cigarettes. About 82% of what consumers pay for a pack of
cigarettes (average cost $4.26 - including statewide sales taxes but
not local cigarette or sales taxes) ends up going to the government
in taxes and other payments rather than for the cigarettes.
Personal Income
Tax
A total of 41 states impose income taxes. New Hampshire and
Tennessee apply it only to income from interest and dividends. Seven
states (Alaska, Florida, Nevada, South Dakota, Texas, Washington,
and Wyoming) do not tax personal income. Of the 41 with a
broad-based income tax, 35 base the taxes on federal returns,
typically taking a portion of what you pay the IRS or using your
federal adjusted gross income or taxable income as the starting
point.
Personal Exemptions and Standard
Deductions
Most states specify amounts for taxpayers and each of their
dependents that can be used as an offset in determining taxable
income. Most also specify the amounts that persons 65 or older can
deduct.
Medical/Dental
Deductions
Most states treat health care expenses as having already been
deducted from federal returns. Two states (North Dakota and Oregon)
allow full deductions while Indiana does not permit itemized
deductions on state taxes.
Federal Income Tax
Deduction
Only 12 of the 41 states with broad-based
income taxes permit taxpayers to deduct federal income taxes. This
is an advantage if you are deciding between two states with similar
rate structures but only one allows you to deduct. The latter would
give you a lower effective tax rate.
Retirement Income
Taxes
Under federal law,
taxpayers may be required to include a portion of their Social
Security benefits in their taxable adjusted gross income (AGI).
Most states begin the calculation of state personal income tax
liability with federal AGI, or federal taxable income. In those
states, the portion of Social Security benefits subject to personal
income tax is subject to state personal income tax unless state law
allows taxpayers to subtract the federally taxed portion of their
benefits from their federal AGI in the computation of their state
AGI.
Many states exclude Social Security
retirement benefits from state income taxes. The District of
Columbia and 26 states with income taxes provide a full exclusion
for Social Security benefits -- Alabama, Arizona, Arkansas,
California, Delaware, Georgia, Hawaii, Idaho, Illinois, Indiana,
Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan,
Mississippi, New Jersey, New York, North Carolina, Ohio, Oklahoma,
Oregon, Pennsylvania, South Carolina, and Virginia.
The remaining 15 states with
broad-based income taxes tax Social Security to some extent:
- Kansas, Minnesota, Missouri,
Nebraska, North Dakota, Rhode Island, Vermont, and West Virginia
tax Social Security income to the extent it is taxed by the
federal government.
- Connecticut, Iowa, Montana and
Wisconsin tax Social Security income above an income floor.
Iowa will gradually phase out its Social Security tax levy from
2008 through 2014. Wisconsin will fully exclude Social Security
beginning in tax year 2008.
- Colorado, New Mexico and Utah
require that federally untaxed Social Security benefits be added
back to federal AGI to calculate the base against which their
broad age-determined income exclusions apply.
States are prohibited from taxing
benefits of U.S. military retirees if they exempt the pensions of
state and local government retirees. Most states that impose an
income tax exempt at least part of pension income from taxable
income. Different types of pension income (private, military,
federal civil service, and state or local government) are often
treated differently for tax purposes.
States are generally free from federal
control in deciding how to tax pensions, but some limits apply.
State tax policy cannot discriminate against federal civil service
pensions. Ten states exclude all federal, state and local pension
income from taxation. These include Alabama, Hawaii, Illinois,
Kansas, Louisiana, Massachusetts, Michigan, Mississippi, New York
and Pennsylvania. Among these 10 states, only Kansas taxes any
Social Security income, but only to the extent it is subject to
federal taxation. These 10 states differ on the taxation of
retirement income from private-sector sources. Kansas and
Massachusetts do not exclude any private-sector retirement income,
but most of the others allow a fairly broad exclusion. Pennsylvania
allows a full exclusion. Alabama excludes income from defined
benefit plans. Hawaii excludes income from contributory plans.
Illinois and Mississippi exclude income from qualified retirement
plans. Louisiana, Michigan and New York cap the private-sector
exclusion at $6,000, $34,920 and $20,000, respectively.
Five states (California, Connecticut,
Nebraska, Rhode Island, and Vermont) allow no exemptions or tax
credits for pension and other retirement income that is counted in
federal adjusted gross income. Most in-state government pensions
are taxed the same as out-of-state government pensions. However,
Arizona, Idaho, Kansas, Louisiana, New York, and Oklahoma provide
greater tax relief plans than they do for out-of-state government
pension plans. The District of Columbia also provides greater tax
relief for DC government pensions than for state government
pensions.
Three states (New Jersey,
Massachusetts, and Pennsylvania) do not allow IRA contributions to
be deducted from taxable income. Of the three, only Pennsylvania
does not tax IRA earnings of taxpayers age 59 ½ years or older,
since earnings are treated like pension income, which is tax exempt.
Retired Military Pay
Some states provide special tax benefits to military retirees.
Others simply follow the federal tax rules. The states that do not
tax retired military pay are: Alabama, Alaska, Florida, Hawaii,
Illinois, Kansas, Kentucky*, Louisiana, Massachusetts, Michigan,
Mississippi*, Missouri*, Nevada, New Hampshire, New Jersey, New
York, North Carolina*, Oregon*, Pennsylvania, South Dakota,
Tennessee, Texas, Washington, Wisconsin and Wyoming.
(*With conditions)
Property Taxes
Taxes on land and the buildings on it are the biggest source of
revenue for local governments. They are not imposed by states but
by the tens of thousands of cities, townships, counties, school
districts and other assessing jurisdictions.
The state's role is to specify the
maximum rate on the market value of the property, or a percentage of
it, as the legal standard for the local assessors to follow. The
local assessor determines the value to be taxed. You can't escape
property taxes in any state. But you can find significantly low
rates in certain parts of the country.
Most states give residents over a
certain age a break on their property taxes. With some taxes,
you'll need a relatively low income to qualify. Forty states
provide either property tax credits or homestead exemptions that
limit the value of assessed property subject to tax.
There may be other tax breaks
available, depending on where you live. All 50 states offer some
type of property tax relief program, such as freezes that will lock
in the assessed value of your property once you reach a certain age,
or deferral of taxes until the homeowner moves or dies. They
ultimately have to be paid. In addition, counties and
municipalities often have their own property tax relief plans.
Retirees with low incomes and high
housing costs may face property tax bills that are higher than they
can manage. Some states target property tax relief to those
homeowners bearing the greatest burden. Property tax reform that
takes into account a homeowner's ability to pay, such as a so-called
"property tax circuit breaker," can better protect low-income
homeowners from rising property taxes that accompany rising property
values. Targeted property tax relief avoids sharp reductions in
funding for locally provided public services and inequities based
solely on date of purchase.
- A property tax circuit breaker
prevents property taxes from "overloading" a taxpayer. Under a
typical circuit breaker, the state sets a maximum percentage of
income that an eligible family can be expected to pay in
property taxes. If property taxes exceed this limit, the state
then provides a rebate or credit to the taxpayer.
- Currently, of the 31 states and
the District of Columbia with circuit breakers for homeowners,
only six and the District of Columbia permit all households to
participate in the program without regard to age.
Other property tax relief strategies
that may be used to target property tax relief include homestead
exemptions which exempt a certain amount of a home's value from
taxation, credits to rebate a certain percentage of taxes paid, and
deferral programs to allow low-income elderly homeowners to defer
payment of property taxes until property is sold.
Property Tax Swaps
More and more states are cutting property taxes in exchange for
increases in sales or other taxes. Idaho, New Jersey, South
Carolina and Texas took this step in 2006. In New Jersey the state
increased the sales tax by 1 cent with half of it designated for
property tax relief in 2006 and possibly the full amount in future
years. Voters in Idaho also approved a 1 cent sales tax increase
that reduces property taxes by $260 million. South Carolina's
Republican governor, Mark Sanford, signed a measure that promises to
cut average property taxes by 60% and makes up the revenue by
increasing the sales tax by 1 cent. The revenue will be used to
support the Homestead Exemption Fund. In Texas the state lowered
property taxes by increasing the taxes on cigarettes and some
business activity.
Best and Worst States:
Based on data from the 2002 census, the following five states have
the lowest local property taxes per capita/year. They are Arkansas
($191), Alabama ($285), Kentucky ($376), New Mexico ($380), and
Oklahoma ($425). The states with the highest local property taxes
per capita/year are: New Jersey ($1,871), Connecticut ($1,733), New
York ($1,402), and Rhode Island ($1,369).
For more information about property
taxes in all states,
click here.
Inheritance and
Estate Taxes
An inheritance tax is an assessment made on the portion of an estate
received by an individual. It differs from an estate tax which is a
tax levied on an entire estate before it is distributed to
individuals. It is strictly a state tax. Eleven states still collect
an inheritance tax. They are: Connecticut, Indiana, Iowa, Kansas,
Kentucky, Maryland, Nebraska, New Jersey, Oregon, Pennsylvania and
Tennessee. Connecticut will be phased out after 2005. In all states,
transfers of assets to a spouse are exempt from the tax. In some
states, transfers to children and close relatives are also exempt.
As for estate taxes, the Economic
Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) phases out
the federal estate tax that culminates in full repeal in 2010. On a
much faster track, the legislation repeals over four years -- 2002
through 2005 -- the federal estate tax credit to which state estate
taxes are tied. In most states, estate and inheritance taxes are
designed in such a way that states face either a full or partial
loss of estate tax revenues as this credit is phased out. States can
avert this loss of revenue by "decoupling." Decoupling means
protecting the relevant parts of their tax code from the changes in
the federal tax code, in most cases by remaining linked to federal
law as it existed prior to the change.
Seventeen states and the District of
Columbia have retained their estate taxes after the federal changes.
Of these, 15 states -- Illinois, Kansas, Maine, Maryland,
Massachusetts, Minnesota, New Jersey, New York, North Carolina,
Ohio, Oregon, Rhode Island, Vermont, Virginia, and Wisconsin -- and
the District of Columbia decoupled from the federal changes. Two
states -- Nebraska and Washington -- retained their tax by enacting
similar but separate estate taxes.
Of these, 12 states acted to decouple
from the federal changes. Illinois, Maine, Maryland, Massachusetts,
New Jersey, Rhode Island, and Vermont enacted legislation linking
their estate taxes to the federal estate tax as in effect before the
2001 tax bill. Minnesota, which passes a tax conformity package each
year, explicitly elected not to change its estate tax to conform to
the federal changes. North Carolina elected to decouple at least
through 2005, and Wisconsin has decoupled through 2007. Nebraska
decoupled by creating a separate state estate tax on estates that
exceed $1 million based on the federal law before the 2001 changes.
In 2005, Washington enacted a separate tax with a somewhat different
rate structure that applies to estates that exceed $2 million after
the state's original decoupling was nullified in court.
In addition, five states and the
District of Columbia will remain decoupled unless they take
legislative action. In five states -- Kansas, New York, Ohio,
Oregon, and Virginia -- and the District of Columbia, estate tax
laws are written in such a way that the state will not conform to
the federal changes unless it takes legislative action.
Tax Burden By State
If all other things are equal, a state with a lower tax burden is a
more attractive place to retire than a state with a higher one. To
get a true sense of which state is less expensive, you need to look
at state and local tax burdens. Only then do the low tax states
stand out.
Taxes that are included in the state
and local tax burden are as follows:
*Property Taxes (represents an
average; individual property taxes vary by locality)
*Sales and Gross Receipts (different taxing entities may add to the
state sales tax)
*Selective Sales Taxes (alcoholic beverages, amusements, insurance
premiums, motor fuels, parimutuels, public utilities, tobacco
products, and others)
*Licenses (alcoholic beverages, amusements, corporation, hunting and
fishing, motor vehicles, motor vehicle operators, public utilities,
occupation and business) *Other Taxes (individual income,
corporation net income, death and gift, documentary and stock
transfer, severance, and others)
The data presented on the linked page
that follows shows states ranked by tax burden as a percentage of
income. The taxes include those paid by individuals AND businesses
to state and local governments. Businesses are included because they
usually pass their tax costs on to consumers.
The top five states where the tax
burden as a percent of income is the highest are: Vermont (14.1%),
Maine (14.0%), New York (13.8%), Rhode Island (12.7%), and Ohio
(12.4%). The United States average is 11.06%. The District of
Columbia is 12.5%.
The five states with the lowest tax
burden as a percent of income are: Alaska (6.6%) 50th, New Hampshire
(8.0%) 49th, Tennessee (8.5%) 48th, Delaware (8.8%) 47th, and
Alabama (8.8%) 46th. Alaska has the lowest tax burden because it
levies significant severance taxes on oil extracted from the state -
taxes that are included in the price of oil sold thereby enabling
Alaska to collect taxes that are paid by consumers across the
country. As a result, the state sends checks to all residents at
tax time.
Other states that export a
significant fraction of their severance tax burdens are Texas and
New Mexico. States that "import" the largest portions of those taxes
are California, Pennsylvania and New York.
Since 2000, five states have
experienced double-digit drops in their tax burden rankings. New
Mexico has dropped 29 places, Idaho 23 places, and Utah 19 places.
Georgia and North Dakota have dropped 15 and 10 places,
respectively. New jersey has seen the highest increase since 2000,
jumping from 24th place to 10th place. Arkansas and Indiana have
both risen 10 places.
The data supporting the tax burden
figures comes from the U.S. Department of Commerce's Census Bureau
and the Bureau of Economic Analysis. It is the most authoritative
source of income and total tax collection data. Its projections of
the tax burden for 2007 come from data as yet unpublished.
To view a table showing the effective
state and local tax burdens as a percentage of income, the tax
burden per capita, and income per capita,
click here. The table does not reflect the tax advantages
available to seniors in many states and municipalities that reduce
their property taxes and/or personal income taxes.
Sources:
* Individual state tax and revenue departments
* State Tax Handbook (2007); published by CCH Inc.
* Federation of Tax Administrators
* The Tax Foundation
* National Conference of State Legislatures
* U.S. Department of Commerce, Bureau of Economic Analysis
Updated: January 2007
Tax Foundation Data ---
http://www.taxfoundation.org/research/topic/9.html
Rankings in 2007 ---
http://www.taxfoundation.org/research/topic/9.html
A Comparative Analysis of State Tax on Business, Tax Foundation, 2012
---
http://www.taxfoundation.org/files/lm_2012_proof_08.pdf
. . .
Table 7 on Page 14
Overall Results
Mature Firms
New Firms
Index Score Rank
Index Score Rank
Alabama
86.0
13
86.4 19
Alaska
97.7.
23
81.1
17
Arizona
86.2
14
114.9
31
Arkansas
102.8
30
69.6
8
California
105.8
34
133.8
45
Colorado
105.4
33
135.1
47
Connecticut
93.9
21
109.3
30
Delaware
98.1
24
80.5
16
Florida
90.6
19
122.8
36
Georgia
71.8
3
66.7
6
Hawaii
142.6.
49.
151.4
50
Idaho
111.7
38
116.0
32
Illinois
126.4
45
94.2
24
Indiana
122.7
43
80.1
15
Iowa
116.5
40
126.8
41
Kansas
133.5
47
141.6
48
Kentucky
88.4
18
69.4
7
Louisiana
84.1
10
52.8
2
Maine
100.4
27
87.3
20
Maryland
82.4
8
134.7
46
Massachusetts
123.6
44
128.2
43
Michigan
98.8
25
96.6
25
Minnesota
112.7
39
119.6
35
Mississippi
109.2
37
89.3
21
Missouri
108.8
36
97.0
26
Montana
93.1
20
93.8
23
Nebraska
82.5
9
31.7
1
Nevada
77.7
4
124.8
38
New Hampshire
99.7
26
91.0
22
New Jersey
121.1
41
104.9
27
New Mexico
97.4
22
80.0
14
New York
121.1
42
124.4
37
North Carolina
80.8
7
79.9
13
North Dakota
87.0
15
83.5
18
Ohio
78.1
5
58.7
3
Oklahoma
87.1
16
65.3
5
Oregon
100.5
28
106.3
28
Pennsylvania
145.1
50
145.9
49
Rhode Island
129.1
46
128.4
44
South Carolina
103.8
32
119.4
34
South Dakota
56.0
2
77.7
11
Tennessee
101.3
29
108.7
29
Texas
85.9
12
127.7
42
Utah
80.2
6
76.7
10
Vermont
103.7
31
79.2
12
Virginia
84.4
11
125.9
39
Washington
87.2
17
126.3
40
West Virginia
140.2
48
118.5
33
Wisconsin
107.7
35
59.8
4
Wyoming
48.3
1
73.3
9
Continued in article
Jensen Comment
Of course there are many other factors to consider when running a business in a
given state. First there are markets to consider. For example Wisconsin and Ohio
look attractive from a tax standpoint but these states are unattractive to labor
intensive business firms because of union power within those states. Such firms
may prefer moving into Alabama, Arkansas, or Mississippi in spite of having to
pay higher taxes. Many firms have moved from New England to the south because of
higher wages and taxes in New England. Taxes and wages have been a disaster for
some states. For example, Hawaii was at one time a thriving grower of
pineapples. Now most of the pineapple growers have moved elsewhere because of
taxes and wages.
Another thing to consider are subsidies to business firms that offset taxes
and wages. For example, when threatened with a huge movements of business firms
out of Illinois (including huge firms like Caterpillar and Sears), Illinois
commenced to offset its high business taxes and wages with business subsidies.
Bob Jensen's threads on taxation are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
"IRS Draws Lines for Political Advocacy," Doug Lederman, Inside Higher
Ed, June 12, 2007 ---
http://www.insidehighered.com/news/2007/06/12/irs
As the
2008 campaign begins to heat up, the Internal
Revenue Service — which is responsible for carrying
out federal tax law that restricts political
activity by nonprofit organizations — has issued
guidelines aimed at giving colleges and other
tax-exempt organizations practical advice about
where the lines are and how not to cross them.
The guidance, which comes in the form of a revenue
ruling that has formal
legal standing, lays out 21 actual situations, in
areas such as voter education efforts, candidate
appearances and issue advocacy — that raised
questions about whether the activity a charitable
organization engaged in should be considered
inappropriate participation in a political campaign.
Although the underlying laws and regulations are
longstanding, the IRS document is an effort to
formalize what have been “pretty subjective”
standards about what’s allowable (or not), said
Bertrand M. Harding Jr., a tax lawyer who
specializes in nonprofit issues. “These offer
insight into the question of ‘Does this cross the
line or not cross the line?’ in fairly helpful
fashion,” Harding said.
Three of the case studies — which as is typical of
IRS publications, do not identify the involved
parties — directly involve colleges or universities.
In
one, a university president wrote in his monthly
column in an alumni newsletter ("My Views") that
“[i]t is my personal opinion that Candidate U should
be reelected.” Although the president used personal
funds to pay for the cost of his column in that one
issue, “the newsletter is an official publication of
the university. Because the endorsement appeared in
an official publication .... it constitutes campaign
intervention” by the university, the IRS concludes.
Continued in article
Taxes In-Depth
Everything you always wanted to know about form 1040 but were afraid
to ask from Taxes In-Depth ---
http://www.taxesindepth.com/
Reviews and links to free tax preparation programs ---
Plan to Pay Uncle Sam ---
http://taxes.about.com
Updates on other tax helper sites from Smart Stops on the Web, Journal of Accountancy, August 2005 ---
http://www.aicpa.org/pubs/jofa/aug2005/news_web.htm
TurboTax, TaxCut Expand Offerings for Federal Income Tax Via
IRS Web Site;
State Tax Returns Are Not Included
If you've been using a basic version of some package like Turbo
Tax and you've not yet paid to upgrade this year, you might be
interested in going to to the IRS Free File site at
http://www.irs.gov/efile/article/0,,id=118986,00.html
For the first time, all taxpayers can
prepare and file federal returns electronically for free through the
IRS Web site. In the past, participants in the Free File
program, a partnership between the IRS and private tax preparers,
had to meet criteria related to age, income or state of residence.
The program is designed to encourage more taxpayers to file
electronic returns, which are cheaper for the IRS to process. This
year, tax software giant Intuit, maker of TurboTax software, has
scrapped all restrictions. For now, anyone who goes to www.irs.gov,
clicks on “Free File” and links to TurboTax can prepare and file
their taxes at no charge. Two other preparers, eSmartTax and TaxACT,
are also offering their services to all taxpayers for free.
Sandra Block, "This year, everyone can file taxes
free at IRS Web site: Some preparers drop restrictions,"
USA Today, January 19, 2005 ---
http://www.usatoday.com/printedition/news/20050119/1a_bottomstrip19_dom.art.htm
The terrific IRS Web site is at
http://www.irs.gov/
Uncle Sam, Meet Uncle Fed
www.unclefed.com
This site bills itself as the “complete online resource for tax
relief” and lives up to that slogan with more than a dozen
sections of information, links and resources for taxpayers,
preparers and professionals alike. The Tax Help Archives house
instructions and forms—from 2000 back to 1996—for help in
preparing delinquent tax returns.
-
- If the great IRS site cannot answer your questions, then I
highly recommend Will Yancey's
great helpers at
http://www.willyancey.com/
As part of an ongoing effort to improve
ethical standards for tax professionals and to curb abusive tax
avoidance transactions, the Treasury Department and the Internal
Revenue Service have issued final regulations amending Treasury
Department Circular 230. “The playing field for tax advisors
has changed with these standards for tax opinions, the new penalties
that Congress recently enacted and other steps the IRS has taken to
detect and deter abusive transactions,” said Namorato. "Most
professionals share our concern about the egregious behavior of some
of their colleagues and we appreciate the efforts of responsible
practitioners to promote ethical practice. We are taking steps to
ensure that all practitioners live up to their professional
obligations.”
AccounitngWeb, December 22, 2004 ---
http://www.accountingweb.com/item/100245
New Tax Guide Available from the IRS ---
http://www.irs.gov/newsroom/article/0,,id=131175,00.html
Blog ---www.taxfoundation.org
Are you moving overseas?
The 2004 Jobs Act rewrote the tax and reporting rules for U.S. citizens
and foreign residents moving overseas. Here are planning suggestions for
this new environment ---
http://www.aicpa.org/pubs/jofa/sep2005/lifson.htm
Great Comparisons of Tax Software
"Tax Software Makes the Grade, by Stanley Zarowin,
Journal of
Accountancy, September 2005, pp. 48-60 ---
http://www.aicpa.org/pubs/jofa/sep2005/zarowin.htm
From Smart Stops on the Web, Journal of Accountancy,
January 2006 ---
http://www.aicpa.org/pubs/jofa/jan2006/news_web.htm
Resources for Tax Time
www.yearendcentral.adp.com
CPAs
and office managers doing payroll can make this tax season easier
with this ADP-sponsored Web site. Find all state and federal tax
forms, a guide to penalty and interest rates and federal tax
calculations. Read case studies in the State Unemployment Insurance
section on employer liability and use a claim cost calculator and
glossary. Go to the Tax Compliance & Financial Services Toolbox to
find STATcentral with 2004, 2005 and 2006 payroll calendars,
reporting forms and the Payroll & Tax Monitor, which highlights and
reports on new and changing state tax rules.
"Forbes “Best of the Web”: Tax Planning,"
AccountingWeb, August 29, 2005 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=101242
There are many
resources available on the Internet
to help you and your clients with
tax planning. Two of the best,
according to
Forbes’ Best of the Web: Tax
Planning are the
Financial Planning Toolkit from
CCH and
AccountantsWorld Tax and Accounting
Directory.
CCH’s Financial Planning Toolkit
offers an excellent Basic Tax Guide
and animated calculators with
detailed explanations and printable
reports. Here users will find top
tax stories in the news and sections
including:
- Personal Financial Advisor
- Financial Planning Process
- Investing
- Insurance and Risk
Management
- Retirement Planning
- Estate Planning
- Tax Planning
The site’s only weak spot, according
to Forbes, is that it links only to
the
Internal Revenue Service (IRS)
web site. |
|
|
|
Converting Home Videos to DVDs
Q: Are there services that will take home video and burn it to a DVD
Question
Where can you find a good retirement calculator?
"Financial Tools on the Web," by Kelly Greene, The Wall Street
Journal, July 21, 2006, Page B5 ---
http://online.wsj.com/article/SB115350728686713845.html?mod=todays_us_money_and_investing
Many readers emailed us notes like
these when we announced the launch of "Ask Encore" this month
and solicited questions about retirement-related financial
issues.
Two of the most
comprehensive calculators we have come across are at
analyzenow.com,
a Web site by Henry
Hebeler, an author and retired Boeing Co. executive. Begin by
clicking on "Free Programs." A preretirement planner there
collects the information Mr. Guttman lists, and can help you put
together budgets for current expenses as well as those expected
in retirement to see if your savings are on track. Retirement
expenses such as medical bills (including Medicare Part B
premiums) could rise more quickly than inflation; this tool lets
you tinker with anticipated increases in future costs. One
caution: To make your predictions as accurate as possible, plan
on spending at least a couple of hours going through old
financial records.
The postretirement
calculator cranks out the amount you can spend each year, using
your age, number of years you want the investments to last,
taxes, income from investments (other than your home), reserves,
debt, Social Security, pensions, and any other income. If you
have a pension with no cost-of-living adjustment, make sure
that's taken into account. In the spot for reserves, be sure to
include savings for future home repairs and car purchases, too,
Mr. Hebeler says.
A calculator at
troweprice.com
figures out your nest
egg's chances for outlasting you by examining how it would
perform in 500 hypothetical future economic scenarios. (Click
the applicable link below "individual investors," then go to the
"investment planning & tools" tab and click "retirement
planning." There, you'll see the link to the retirement-income
calculator.) WSJ.com also offers retirement-planning tools at
WSJ.com/BookTools.
Firecalc.com
uses investment returns
since 1871 to figure out how often your strategy would have paid
off historically. Of course, tools like these come with a big
caveat: Nobody can predict the future. But if, say, firecalc.com
indicates that your nest egg might have survived the Great
Depression and other financial calamities that have hit the U.S.
in the past 135 years, at least you can take comfort in that.
• Ask
Encore/Focus on Retirement is a weekly column answering
readers' questions about retirement and personal finance --
from annuities and bonds, to trusts and inheritance issues.
Send questions to
encore@wsj.com.
Bob Jensen's threads on calculators are at
http://faculty.trinity.edu/rjensen/bookbob3.htm#080512Calculators
"Five Best Books on Taxes IRS on your mind? Tax expert Randy
Blaustein declares these books to be major assets," The Wall Street Journal,
January 28, 2006; Page P8 ---
http://online.wsj.com/article/SB113839091155258477.html?mod=todays_us_pursuits
1. The IRS Problem Solver By Daniel J. Pilla
Regan Books, 2003
Daniel J. Pilla provides nine valuable secrets to
winning your audit -- but bear in mind that the general
rule is never try to handle an IRS audit yourself (it's
like trying to perform your own brain surgery). Another
important rule: Never walk into an audit without knowing
the issues. Anticipate the questions you are likely to
be asked and be prepared with the documentation that
will be needed to resolve the matter in your favor. The
author supplies plenty of sample form letters --
requesting an abatement of penalties, for instance, or
asking for the release of a levy placed on your salary
-- that could be used to respond to almost anything the
IRS throws at you.
2. Confessions of a Tax Collector By Richard Yancey
HarperCollins, 2004
A
reminiscence of the author's 12-year career as a revenue
officer (a field employee of the IRS's Collection
Division), this book reveals how the officers are taught
to impose their will on delinquent taxpayers. Mr. Yancey
recalls the advice about the opposition offered by a
senior revenue officer shortly after he was hired: "Find
where they are. Track what they do. Learn what they
have. Execute what they fear." This book is replete with
stories about the nuts and bolts of collecting taxes
from people who either don't have the money or simply
don't want to pay. "'Never enter a taxpayer's kitchen,'
one training manual cautioned us. 'A kitchen usually has
knives and other implements which may be used as
weapons.'"
3. What the IRS Doesn't Want You to Know By Martin S. Kaplan
Wiley, 2003
This is the ninth edition Martin S. Kaplan's book,
significantly updated since the certified public
accountant began a decade ago unveiling information that
other tax professionals were afraid to discuss publicly
for fear of IRS retaliation. Mr. Kaplan does a
compelling job of explaining how to tell if the IRS
suspects you of criminal tax fraud. He also lays out how
the Criminal Investigation Division proves the critical
element of "willful intent" when taxpayers refuse to
make specific records available or submit false invoices
to support a tax-return item. The author reveals his
trade's secrets -- for example, how companies designated
"S" corporations can be used by shareholders for
deductions that are unlikely to attract the IRS's
scrutiny.
4. Tax This! An Insider's Guide to Standing Up To the
IRS By Scott M. Estill Self-Counsel Press, 2000
The author, a former IRS senior trial attorney, tells
you how to level the playing field and win when dealing
with the IRS. The advice (for individuals and
businesses) is accompanied by citations of IRS code and
regulations, useful for readers who want more
information on a particular issue. Taxpayers who owe the
IRS money will find here all the instructions they need
on the important questions. One chapter, titled "Fight
the IRS in Court," offers readers a primer in ways to
represent themselves in Tax Court. Mr. Estill's advice
-- forceful and direct -- is research the law, be
organized, stand when speaking and, not least, don't
ever interrupt the judge.
5. J.K. Lasser's Your Income Tax 2006 By J.K. Lasser Institute
Wiley, 2005
The current incarnation of the Lasser franchise, so
beloved by taxpayers, encompasses some 816 pages on
every possible detail concerning the preparation of your
2005 personal income tax return. One chapter, devoted
entirely to the IRS, includes such matters as your odds
of being audited and the average itemized deductions for
2003 (medical, taxes, charity, interest) based on
adjusted gross income. It also offers good basic
information about preparing for an audit and handling
one. And the authors explain how to recover the costs of
a tax dispute if the IRS took an unreasonable position
that forced you to incur legal fees and other expenses
in order to win your case. |
-
From Smart Stops on the Web, Journal of Accountancy,
September 2005 ---
Stop Threats Near and Far
www.isalliance.org
Are your company’s computers suffering from Web insecurity? Give
your PCs peace of mind with a visit to the Internet Security
Alliance e-stop. Free registration gets you three best practices
guides on cybersecurity for individuals, senior managers and small
businesses. The News section offers the “Insider Threat Study:
Computer System Sabotage in Critical Infrastructure Sectors.”
Get in the Know www.software-engine.org
CPAs and IT managers looking for software can click on this Web site
for free downloads, program reviews and vendors. A search for
accounting software returns links to sites that offer demos,
explanations and pricing information. Or you can search categories
such as antivirus, banking, content management, telecom and Web
design software.
Risky Business
www.disasterrecoveryworld.com
CPAs and IT professionals will find business continuity and disaster
recovery planning tips in a slide-show presentation at this Web
stop. Other resources include articles, papers and real-life
disaster recovery stories, guidelines for testing a plan and a
suggested statement of support from the executive level of your
organization.
For the Record www.itic.org
The Information Technology Industry Council keeps track of
regulatory policy documents such as guidelines for grounding IT
equipment and lists international IT standards through a link to the
International Committee for Information Technology Standards’s
e-stop. Categories of interest for CPAs include electronic commerce,
export controls, intellectual property, taxation and
telecommunications.
Federal Depreciation Rates ---
http://www.smbiz.com/sbrl012.html
You can add to or take from the TaxAlmanac
TaxAlmanac: The free online tax research resource and community ---
http://www.taxalmanac.org/index.php/Main_Page
"Users Size Up Tax Software, by Stanley Zarowin, Journal of
Accountancy, October 2004, pp. 70-80 ---
http://www.aicpa.org/pubs/jofa/oct2004/zarowin.htm
Although AICPA tax practitioners rated this
year’s crop of tax-preparation software superior to the products
they used last year, they gave lower grades to vendors’ technical
support. But for many tax practitioners, the bigger story was that the
number of tax-software products continued to decline, forcing newly
orphaned customers to go through the agony of selecting a new package
and converting their client tax files to make them compatible. Such
were the highlights of the Journal of Accountancy’s spring 2004
survey of 2,010 AICPA tax-department members. The average satisfaction
rating for the nine professional products included in the survey was
4.09—out of a possible 5.00—up from last year’s average of 3.61,
with Intuit’s Lacerte posting the highest overall ratings with a
score of 4.43 (see exhibit 2). Three products tied for third place
with a score of 4.35: Drake Software, Thomson Creative Solutions’
UltraTax and CCH Tax and Accounting’s ProSystem fx Tax.
The average cumulative rating for technical
support slipped sharply to 2.44 from 3.50 last year, although
respondents reported an improvement in the way their software ran on
their networks—4.09, up from 3.50.
For a list of the vendors included in the
survey, see exhibit 1.
SHRINKING MARKET The survey also revealed
that not only is the field of vendors dwindling, but the existing
market is becoming more concentrated, with four products appearing to
lead the field with the most customers: Intuit’s Lacerte and
ProSeries, CCH’s ProSystem fx Tax and Thomson Creative Solutions’ UltraTax.
Evidence of the growing concentration can be
deduced from the data in exhibit 2. Although more than twice as many
tax practitioners responded this year than last (2,010 vs. 993),
making the 2004 data more statistically reliable, only nine products
received the 10 or more responses needed to qualify for inclusion in
the survey. That’s down from 12 last year.
In addition, tax year 2004 will see at least
three fewer tax software products on the market. Thomson Creative
Solutions, which owns UltraTax and RIA’s GoSystem Tax RS, acquired
the customer lists of Tax Relief and Exact Tax, both of which withdrew
from the market. Also, Best Software sold its CPA Software Visual Tax
customer list to CCH, which will be attempting to migrate those
customers to its ProSystem fx Tax.
Caveat: The lopsided response in favor of
just four products makes the individual scores of the remaining five
products statistically unreliable. GoSystem Tax RS received just 50
responses, Max Plus 44, TaxWorks 29, Drake 17 and TaxWise 12. However,
we believe the cumulative average of all nine product scores in
exhibit 2 is statistically reliable.
Currently, there are only 16 tax software
products on the market that provide all the necessary federal forms
and can calculate taxes for every state with an income tax. That’s
down about 20% in the past decade. Aside from the packages reviewed in
this survey, other products on the market include GreatTax, Orrtax,
Dunphy, Taxslayer, Petz Crosslink, TaxSimple and TaxAct.
When a software publisher acquires a
competitor, it usually just wants the customer list; the acquired
product usually becomes defunct and the buyer seeks to convert the
orphaned customers to its brand. But when Intuit acquired Lacerte a
few years ago, it took a different tack: Because both the Lacerte
brand name and product were so popular, Intuit decided to continue the
package under a joint name.
TROUBLE FOR PRACTITIONERS The current
turnover rate—the percentage of customers voluntarily moving to a
new product or being forced to switch because their current product
was being withdrawn—ran at about 13% last year (see exhibit 3).
Most tax practitioners are not happy about
market consolidation—and for good reason. Switching tax packages is
no small matter. First of all the CPA firm has to install the new
product on its network, praying its computer system is sufficiently
robust to handle the change; if it isn’t, the customer must go
through the often difficult and expensive process of upgrading the
hardware.
Then, since each tax package operates
differently, the firm’s tax professionals must learn to run the new
software and become familiar with all its unique technical nuances.
And finally, the firm has to put all its client tax data through the
new vendor’s conversion software to make the returns compatible with
the new package—all the while worrying whether the conversion
process will leave it with hours of work tracing for evidence of
errors.
Continued in the article
What if you are on leave of absence outside the U.S.
A
Trinity professor had a tax question for faculty on leave outside the
U.S.
My good friend
Amy
Dunbar
from the
University
of
Connecticut
sent us some guidance on this matter.
Amy’s answer may be of interest to other faculty planning
leaves outside the
U.S.
I might add that forty years ago I was a tax accountant, but
now I’m considered a menace to the world when it comes to
tax questions. I
now put my stuff into TurboTax and cross my fingers.
In
previous TigerTalk messages I noted that basic tax software,
including TurboTax and TaxCut are now free as long as you
are willing to file electronically ---
http://www.irs.gov/efile/article/0,,id=118986,00.html
You have to scroll down to read Amy’s message.
Bob Jensen
-----Original
Message----- From: Amy
Dunbar Sent:
Sunday, February 06, 2005
10:36 PM
To: Jensen,
Robert Subject: RE: a
question about the tax code
For
a
US
person to exclude foreign earned income under Sec. 911, she must
be a bona-fide resident of the foreign country OR be
physically present in the foreign country 330 out of 365
days. Tell your friend to get IRS Publication 54 for
guidance. I copied the following excerpts from CCH.
U.S.
citizens and resident aliens of the
United States
are generally taxed on their worldwide income. For tax years
beginning in 2002 through 2007, qualified individuals who
live and work abroad may elect to exclude from gross income
up to $80,000 of foreign earned income, as well as certain
employer-provided housing costs (Code
Sec. 911(b)(2)(D) and
Reg.
§1.911-1(a)). Individuals with
self-employment income are also entitled to deduct certain
non-employer-provided housing costs (Code
Sec. 911(c)(3) and
Reg.
§§1.911-4(d)(3) and
(e)).
The sum of the exclusions and the deduction may not exceed a
taxpayer's foreign earned income (Code
Sec. 911(d)(7)). The dollar amount
limitation on the
Code
Sec. 911 exclusion increases annually; for
a schedule of the increased maximum exclusions, see
¶28,049.025.
For the exclusions and the deduction to apply, the
taxpayer's tax home must be in a foreign country (see
¶28,049.021).
The following are not considered foreign countries for
purposes of the exclusions and deduction: American Samoa,
Guam, the Commonwealth of the Northern Mariana Islands,
Puerto Rico, the Virgin Islands and the Antarctic region (Reg.
§1.911-2(g)-(h);
see also IRS Pub. 54, "Tax Guide for U.S. Citizens and
Resident Aliens Abroad" (for 2003 returns)).
Taxpayers living and working abroad may also exclude from
gross income the value of meals and lodging provided by an
employer under the same general rules that apply to all
taxpayers (Code
Sec. 119). However, the requirement that
lodging be furnished on the employer's business premises in
order for the exclusion to apply is modified in the case
where employment in a foreign country is in a remote area
(see
¶7222.021).
In addition to the exclusions and deductions discussed
above, a taxpayer may also be entitled to a credit for
foreign taxes paid on his earnings abroad that are not
excludable (see
¶27,826.021).
In computing
U.S.
tax liability, a taxpayer may not claim exclusions, deductions or
credits that are properly allocable or chargeable under
Reg.
§1.861-8 to amounts that are excluded
from income under
Code
Sec. 911(a). Thus, a taxpayer may not
deduct unreimbursed employee business expenses against wage
income that was excluded as foreign earned income (Code
Sec. 911(d)(6) and
Reg.
§1.911-6(a)).
Physical presence test. A citizen or resident alien of the United States whose tax home is
a foreign country will be eligible for the foreign earned
income exclusion and housing cost exclusion if he is present
in a foreign country or countries for 330 days out of any
consecutive 12-month period (Reg.
§1.911-2(d)). The taxpayer does not have
to be present in the foreign country solely for business
purposes in order to meet this test. Some of the qualifying
foreign presence time can be vacation time.
The 12-month period may begin on any day of the calendar
month. The period ends with the day before the corresponding
calendar day in the 12th succeeding month, or, if there is
no corresponding calendar day, with the last day of the 12th
succeeding month. A full day for purposes of the 330-day
requirement is a period of 24 consecutive hours beginning at
midnight
.
Any period of 12 consecutive months may be used, provided
the 330 days on foreign soil fall within that period. It is
not necessary to begin or end any 12-month period with the
first full day after arrival in a foreign country or the
last full day before departure. Also, any 12-month period
may overlap another.
Example
(4):
A
taxpayer arrives in a foreign country on
April 24, 2004
, at
noon
, and remains in the foreign country until
2 p.m.
on
March 21, 2005
. Among other possible twelve-month periods, the taxpayer is
present in the foreign country an aggregate of 330 full days
during each of the following twelve-month periods:
March 21, 2004
, through
March 20, 2005
, and
April 25, 2004
, through
April 24, 2005
.
Waiver of time limits.
With one exception, the 330 day requirement is
unconditional. Thus, if a taxpayer falls short of the 330
day requirement because of a vacation in the
U.S.
or because illness forces a return to the
U.S.
, then the physical presence test is not satisfied.
However, relief from the residence requirements is provided
for taxpayers who would otherwise satisfy the bona fide
residence or the physical presence test except for the fact
that they were forced to leave foreign countries because of
civil unrest, war, or other adverse conditions (Reg.
§1.911-2(f)). |
Taxation Sites from Smart Stops on the Web,
Journal of Accountancy, October 2004, Page 19 ---
http://www.aicpa.org/pubs/jofa/oct2004/news_web.htm
Links for
Professionals
www.taxsites.com
CPAs and tax preparers will want to bookmark this
directory to accounting, payroll and tax Web sites. In the tax
software category, users can find many links to electronic
programs for income tax preparation, payroll and 1099s, estate,
trust and retirement, and sales and use taxes. Other topics
include federal tax laws, rates and tables, tax forms and
publications and tax associations such as the Institute for
Professionals in Taxation.
E-Filing Help
www.autotax.com
Tax preparers who electronically file returns will
find links to federal forms and instructions,
www.irs.gov
and state e-file application requirements here. Users can find
their way to all state revenue and tax e-sites, and download Form
8633, Application to Participate in the IRS e-file Program.
Shoppers can view a free demo of Tax Link’s AutoTax Pro
software.
Wealth
Preservation Resources
www.estateplanninglinks.com
Elder law attorney Dennis Toman’s e-stop offers
estate planners links to Web sites with current and archived IRC
section 7250 rates, estate tax calculators and IRS tax tables.
Visitors can get a free seven-part course on estate planning
subjects including joint tenancy, living trusts and probate, as
well as find estate planning glossaries, articles such as “Top
Seven Estate Planning Questions” and the e-pamphlet Life
Advice About Making a Will.
Calculators
Aplenty
www.completetax.com
CPAs and tax preparers will want to bookmark this
Web stop for a useful offering—free calculators. Visitors can
find auto expense, home and personal finance, investment, lease,
refinance and retirement calculators. Other site resources, such
as the 2004 tax guide, current and archived tax news, forms,
tables, worksheets and a tax glossary, also will come in handy.
For Gift Tax
Returns
www.709accountant.com
CPAs and their clients can read a comprehensive
guide to the federal gift tax at this e-stop. Topics of discussion
include annual exclusions, charitable deductions, due dates and
extensions, generation-skipping transfers and marital deductions.
Visitors also can access gift tax rate and unified credit tables
for Form 709, United States Gift (and Generation-Skipping
Transfer) Tax Return, as well as look into purchasing 709
Accountant’s federal gift tax software.
- Hyperology ---
http://snipurl.com/Hyperology
This site features a lot of things including coverage of tax and
401K deductions.
New Tax Helper Sites from Smart Stops on the Web, Journal of
Accountancy, August 2004, Page 25 ---
Strategies for Savings
www.gofso.com/premium/ts/ts_menu.html
CPAs and personal financial planners can enter
this Web site through the back door to read guidance for clients
on maximizing tax deductions such as travel and entertainment
expenses and charitable contributions. Users also can find
financial calculators, information on topics including annuities
and mutual fund taxation, and due dates for filing tax returns and
reporting tax information.
Fact or Fiction?
www.incometaxstrategies.com
Tax advisers can look over the tax secrets and
myths section of this e-stop on debunking falsehoods, such as the
idea that not taking every possible deduction reduces a client’s
chances for an audit, as well as learn about little-known
strategies such as how to get an annual early tax refund. The site
features links to more than 80 itemized deductions and a free
monthly newsletter.
Resources and Tips
www.funwithtaxes.com
Tax specialist and author Gail Perry’s online
compilation of her column “Fun With Taxes” includes links to
articles from the New York Times such as “Beating the
Tuition Blues and Earning Some Tax Breaks” and her own
writings—such as the article “IRS Throws Foul Ball Into All
American Pastime.” In addition, visitors can find daily tax tips
from the IRS and the Tax Preparation Tool Box, which includes an
IRA calculator to determine eligibility or compare Roth IRAs with
traditional ones to see their worth at retirement.
For Filing and More
www.taxbrain.com
In addition to free registration, links to state
and federal tax forms and electronic filing options, tax preparers
who visit this Web stop can click on the Tax Center link at the
bottom of the home page to find a tax glossary, the e-document
“Seven Tax Return Mistakes to Avoid,” a W-4 calculator and a
tax estimator.
Government Approved
www.homebusinesstaxsavings.com
Tax consultants and preparers with
home-business-based clients can find tips here on tax breaks in
compliance with congressional law, the tax code and tax court
rulings such as “converting ‘commuting miles’ into
tax-deductible business miles,” the benefits of obtaining an
employer identification number and deductions for donations. Users
also can sign up for a free subscription to the newsletter Tax
Tips You Can Bank On.
New (Year 2004) E-Services Tools for Tax Professionals ---
http://www.smartpros.com/x44233.xml
Bob Jensen has two threads on tax controversies:
-
-
- "Evaluating Tax Software," by Stanley Zarowin, Journal
of Accountancy, October 2002, pp. 38-47 ---
http://www.aicpa.org/pubs/jofa/oct2002/zarowin.htm
-
- "New Tax Break for Teachers," Journal of
Accountancy, August 2002, Page 65 ---
http://www.aicpa.org/pubs/jofa/aug2002/tax1.htm
-
- Tax fraud and tax scams ---
http://faculty.trinity.edu/rjensen/fraud.htm#TaxFraud
-
- Tax Agencies Around the World ---
http://www.oecd.org/daf/fa/links/links.htm
-
- IRS Forms Search Page ---
http://www.irs.ustreas.gov/plain/forms_pubs/findfiles.html
Download IRS Tax Forms ---
http://www.irs.ustreas.gov/plain/forms_pubs/forms.html
!040 -ES 1040 ES Estimated Tax Forms ---
http://ftp.fedworld.gov/pub/irs-pdf/f1040e01.pdf
IRS Offers New Withholding Calculator Looking for a quick way to
figure out what your income tax will be under the new tax
legislation?
http://www.accountingweb.com/item/52146
2001 State Government Tax Collections
http://www.census.gov/govs/www/statetax01.html
Which Is Better: TurboTax or TaxCut? ---
http://www.thestreet.com/_tscs/funds/taxes/1359496.html#restofstory
This article is two years old, but it is still somewhat informative.
A more recent Year 2003 comparison is at
http://www.thestreet.com/_tscs/funds/beverlygoodman/10067709.html
Also see
http://www.pcmag.com/article2/0,4149,810950,00.asp
News and Resources:
Tax Professional's Corner ---
http://www.irs.gov/bus_info/tax_pro/index.html
Tax Analysts: Tax Information Worldwide online
http://www.tax.org/
Statistics of Income Overview from the IRS ---
http://www.irs.gov/taxstats/display/0,,i1%3D40%26genericId%3D16924,00.html
Blocksoft.com offers many tips on taxes and tax resources
Use Block's new TaxCut 1040EZ Online for FREE.
http://www.blocksoft.com/
Intuit --- it is a market share leader with Quickbooks and TurboTax
http://www.intuit.com/
Also note the Turbo tax contest described at
http://www.netguide.com/Site/Detail?id=117856
Microsoft Money Financial Suite ---
http://www.microsoft.com/products/prodref/699_ov.htm
http://www.microsoft.com/products/prodref/699_ov.htm
Microsoft Money Plus ---
http://www.microsoft.com/Money/default.mspx
Money.com is a personal finance web site that offers many tax tips on how to save tax
dollars and avoid tax audits
http://www.pathfinder.com/money/plus/index.oft
Visit NYTimes.com's Website called "Your Taxes," a
comprehensive guide to FAQs about tax filing. This site was
prepared in collaboration with the experts at TurboTax,
"Your Taxes" contains tax forms, calculators and
step-by-step information on filing ---
http://www.nytimes.com/taxes?0221
As a former tax columnist
for the New York Times, I recently launched a comprehensive
tax site for individuals and would like to recommend its listing in
your tax links directory. The site is called TaxPlanet.com - All
Things Tax for Individuals. Its url is
www.taxplanet.com
Gary Klott@taxplanet.com
[GaryKlott@taxplanet.com]
1099 - "the magazine for independent professionals."
(Tax, Personal Finance, Careers, Small Business)
http://www.1099.com/
"Important Tax-Act Dates for Taxpayers to Know," by the
Financial Planning Association ---
http://flywheel.memeticsystems.com/backend/ct_click.cgi?ct_id=973&type=1
The
above site has much more than dates --- it is a great summary of key things to
consider in financial planning and investing. Take a look and see how
useful this site really may be in your life.
Guide to 2004 Web-Based Tax Software from PC World
--- http://www.pcworld.com/news/article/0,aid,114426,00.asp
Go online for a choice of tax-preparation programs varying in
capability and cost.
-
-
-
Duke and Pace researchers shed light on corporate tax shelters
A study by researchers from Duke University and
Pace University found that use of corporate tax shelters not only allows
organizations to avoid billions of dollars in annual tax payments, it
may also help companies artificially enhance their attractiveness to
investors by reducing levels of debt. The study also explores some
commonly used tax shelters and the characteristics of firms that have
employed these shelters. Finance professors John R. Graham of Duke's
Fuqua School of Business and Alan L. Tucker of Pace's Lubin School of
Business collected the largest known sample of tax shelters utilized by
corporations during the past 25 years.
"Duke and Pace researchers shed light on corporate tax shelters," Lubin,
December 22, 2004 ---
http://snipurl.com/DukePace
-
Dear Professor Jensen
June 28,
2004 message from Jenn Glass
[jglass@digitalbrandexpressions.com]
Your
site is a great resource. I found it while doing research our
client, Jackson Hewitt,
a
division of Cendant, and the fastest-growing tax service in the
country. Jackson Hewitt, founded in the mid-1980s has grown to over
4,000 locations throughout the nation. Most Jackson Hewitt
offices are independently owned and operated, and offer full-service
individual tax preparation, electronic filing and Refund
Anticipation Loans.
Jackson
Hewitt’s website is packed with useful tools, tips, and financial
resources, including a Tax Resource Center, Tax Calculators, Tax
Tips, Tax Glossary, Tax Law Changes, and Tax News. After review of
your site, I believe this information may be of interest to your
site’s visitors. Would you create links to Jackson Hewitt from
http://faculty.trinity.edu/rjensen/
with the following information:
Title:
Jackson Hewitt
URL:
http://www.jacksonhewitt.com
Description:
Experts in tax return preparation and processing, promising fast,
accurate, trustworthy professional service for each customer. Visit
Jackson Hewitt.com for useful tools, tips, and financial resources,
including a
Tax
Resource Center,
Tax
Calculators,
Tax
Tips,
Tax
Glossary,
State
and Federal Tax Law Changes, and
Current
Tax News.
Additionally,
I have included an article entitled, “Top 25 Overlooked Tax
Deductions” below. We are offering this article, free of charge,
to sites who might find it useful for their site visitors. Please
feel free to post to your site upon your review. We ask that the
embedded links to Jackson Hewitt remain linked in the document upon
posting.
-
Article -
Top
25 Overlooked Tax Deductions
You
wouldn’t believe the number of deductions that are overlooked each
year, by taxpayers just like you. That’s right; these money-saving
deductions are missed by countless income earners every tax season.
Read on and arm yourself to take full advantage of these deductions
and get back what you deserve:
-
Student
loan interest
-
Self-employment
tax paid (50% is deductible)
-
Health
insurance premiums for some self-employed persons
-
Penalty
on early withdrawal of savings
-
Alimony
paid (not including child support)
-
Medical
transportation costs
-
Nursing
home medical care expenses
-
Certain
medical aids
-
Hearing
aids, eye glasses, and contact lenses
-
Some
hospital fees
-
Medical
equipment for disabled or handicapped individuals
-
Certain
life-care fees paid to retirement home
-
Alcohol,
drug abuse treatment, and certain stop-smoking treatment costs
-
Special
school costs for mentally or physically handicapped individuals
-
Nursing
service costs
-
Prior
year State income taxes
-
Estimated
state taxes for the last quarter of the year
-
Personal
property taxes on cars, boats, etc.
-
Taxes
paid to a foreign government
-
Mandatory
contributions to state disability funds
-
Points
paid on mortgage or refinancing
-
Property
donated to a recognized charity
-
Cash
contributions to a recognized charity
-
Mileage
costs for charitable activities
-
Qualified
casualty and theft losses
Note:
Not every item will be applicable to your situation.
For
further advice on taking advantage of these as well as other
deductions, contact a local
tax
preparation service like Jackson Hewitt. Also, follow these
links to other interesting topics that can help you save on taxes
and keep more money in your pocket:
Tax
Tips and
Tax
Help.
-
End Article -
Thank
you,
Jenn
Jennifer
Glass
e-Marketing Assistant
Digital Brand Expressions
4499 Route 27
Kingston, NJ 08528
(609) 688-1606
www.digitalbrandexpressions.com
"Users Rank Tax Software," by Stanley Zarowin, Journal
of Accountancy, October 2003, pp. 30-39 ---
http://www.aicpa.org/pubs/jofa/oct2003/zarowin.htm
TaxACT |
5925 Dry Creek Lane,
NE, Cedar Rapids, IA 52402 |
800-573-4287 |
www.taxact.com |
ATX
Forms |
Total
Tax Office, Max, Saber and ZillionForms |
63
Sweden St., PO Box 1040, Caribou, ME 04736 |
877-728-9776 |
www.atxpros.com |
CCH |
ProSystem fx
Tax |
21250 Hawthorne
Blvd., Torrance, CA 90503 |
800-739-9998 |
www.prosystemfx.com |
Creative
Solutions |
UltraTax |
7322
Newman Blvd., Dexter, MI 48130 |
800-968-8900 |
www.creativesolutions.com |
Drake Software |
Drake Tax Solution |
235 E. Palmer St., Franklin, NC 28734 |
800-890-9500 |
www.drakesoftware.com |
Dunphy
Systems |
1040
Professional Tax Prep |
6740
Huntley Rd., Suite 103, Columbus, OH 43229 |
614-431-0846 |
www.dunphy.com |
Intuit/Lacerte |
Lacerte |
5601 Headquarters
Dr. Plano, TX 75024 |
800-765-4065 |
www.lacertesoftware.com |
Intuit/ProSeries |
ProSeries |
110
Juliad Ct., Fredericksburg, VA 22406 |
800-934-1040 |
www.proseries.com |
Laser Systems |
TaxWorks by Laser Systems |
350 N. 400 West, Kaysville, UT 84037 |
800-230-2322 |
www.taxworks.com |
RCS
TaxSlayer Pro |
TaxSlayer
Pro |
610
Ronald Reagan Dr., Evans, GA 30809 |
706-868-0985 |
www.taxslayerpro.com |
Tax$imple |
Tax$imple |
8 Emery Ave., Randolph, NJ 07869 |
866-729-7798 |
www.taxsimple.com |
Universal Tax Systems |
TaxWise |
6
Mathis Dr. NW, Rome, GA 30165 |
800-755-9473 |
www.taxwise.com |
Tax Software Sites from Smart Stops on the Web, Journal of Accountancy,
October 2003, Page 27 ---
http://www.aicpa.org/pubs/jofa/oct2003/news_web.htm
Windom’s World
www.windom.org
Wyoming-based accountant and tax preparer
Jarvis Windom offers professional preparers free tax resources at
his nuts-and-bolts e-stop. Users can scroll down his home page for
links to many tax software Web sites, which provide free demos for
preparing electronically filed returns and tax forms, rates and
tables.
News and Reviews
www.softwarenews.net
Information technology consultants and CPAs
can tap into the e-version of The CPA Software News
magazine and access its features and columns, buyer’s guides,
detailed software reviews and due diligence tables for estate
planning.
Free Conversion
and Evaluation Copy
www.proseries.com
Intuit’s Web site for ProSeries tax
preparation software offers CPAs and professional preparers a free
evaluation CD including forms to e-file, as well as a free CPE
self-study course. The company says it will convert new users’
client data for free.
For Tax
Preparers
www.completetax.com
After utilizing this site’s online tax
prep software for a one-time fee of $24.95, CPAs and tax
professionals can e-file client returns for free and access
resources such as a detailed explanation of the new provisions of
the 2003 Tax Relief Act, a tax glossary and links to forms, tables
and worksheets. The site also has a collection of personal finance
calculators CPAs can use when advising clients.
Take a TaxCut
www.taxcut.com
This e-commerce site for H&R Block’s
TaxCut software offers free resources such as sections on tax law
changes and tax planning. Users also can access a tax estimator and
a withholding calculator and discover the “Top Ten Overlooked
Deductions.”
Visualize No
Matter the Size
www.cpasoftware.com
Whether CPAs and tax pros are filing
individual or corporate client tax returns, this Web site offers its
tax prep software in a unique way—in the same format as the paper
version. Visual Business Tax and Visual 1040, 1041 and 991 tax
software mirrors the hard-copy forms, making e-filing easier by
giving professionals a familiar platform on which to work.
From the Journal of Accountancy in September 2002 ---
http://www.aicpa.org/pubs/jofa/sep2002/news_web.htm
Links to Tax Programs
www.futureofsoftware.net
CPAs and tax preparers can find links here to
sites that offer software—either to demo for free or
purchase—as well as hardware and peripherals. Users can explore
categories such as computer rentals, data recovery and storage,
and multimedia. A search on the site for tax software returned 34
different links.
E-Filing Info and Tax Tips
tax.links.ws
Professional tax preparers can go from this home
page to state sites, which offer income tax forms and/or online
filing. The tax tips section offers news, and current and archived
suggestions for how to reduce the amount of tax individuals pay,
as well as links to research current tax issues. And, of course,
users also can find links to research tax preparation software
such as Quicken TurboTax and TaxCut from H&R Block.
Something for Nothing
www.electronictaxservices.com
Tax professionals can click on links to sites with free tax
resources including information on where to file for a tax
extension at www.taxextensions.com
and the “101 Hot Tax Tips” audiotape available from the
National Audit Defense Network at
www.awayirs.com/ap/affiliate_fuel.htm.
Users also can find links to sites with discounted tax preparation
and filing software from Quicken TurboTax.
Invest Time to Learn Here
www.moneyeducation.net
Although this site is designed to “bring the
investor the most thorough information possible on all investing
topics,” it doesn’t leave professional tax preparers out. They
can find links to www.irs.gov and
state Web sites for tax forms, as well as tax software ratings.
Comparison Shop
www.consumersearch.com
CPAs and PFPs can find links to detailed tax
preparation software reviews in the Personal Finance section of
this site. Users can read comparison charts, download for free the
basic version of the software TaxAct 2001, find pricing
information (including discounts and rebates on tax preparation
programs) and search for local software dealers.
Discounts and Forms
1-free-internet.com/1-tax-forms
CPAs and tax specialists can look up tips on how
to reduce their clients’ taxes, as well as obtain tax planning
and preparation advice here. This site also links to
www.irs.gov
and irs.com (no relation to the
federal agency) for tax forms, instructions, rates and tables.
Users can link to turbotax.com
to get coupons for up to $20 off its tax software products.
A helpful Social Security helper link
in a message from Linda Pfingst, CPA [lcpfingst@SPRINTMAIL.COM]
Thought
I would share an interesting web page for calculating break-even
ages for social security benefits. I am often asked "what
would be more beneficial, to retire at 62 or 63, or wait until
my full retirement age of 66?" The SSA.gov site does not
consider all of the combinations, and after some searching I
found a "neat" site by David Zinda:
http://www.social-security-table.com/index.htm
No
fancy variables (present, future,inflation adjustments) just
straight calculations. Save a ton of time working it out
"by hand" or even with T-Value.
Linda
C. Pfingst, CPA
After viewing the first
page, click on "Next"
-
From "Smart Stops on the Web," Journal
of Accountancy, January 2004, Page 31 ---
http://www.aicpa.org/pubs/jofa/feb2004/news_web.htm
Tax Time Once Again
taxes.yahoo.com
Accountants and preparers gearing up for tax season
will find state and federal tax forms and more than 200 articles on,
for example, capital gains, mutual funds and tax rules for gifts, as
well as tax calculators for investing, retirement planning and home
mortgages and sales at Yahoo’s Tax Center. Visitors can use a
glossary of tax terms and a preparer’s checklist from H&R
Block.
Grants for Growth
www.government-grants-101.com
CPAs can point clients to small business advice and
links to financial services, government grants and loans at this Web
stop. Visitors can find business plan templates, checklists and
frequently asked questions in categories including home and Internet
businesses and sales and marketing.
Gratis Legal Advice
law.freeadvice.com
CPA consultants for individuals and small business
owners can tap into free online legal expertise here. Categories
include bankruptcy, business, employment, estate planning,
financial, intellectual property and tax law. Each one lists a
series of general questions and answers on that topic.
Small Business Resource Guide
"The
Small
Business Resource Guide, CD-ROM 2002 provides critical tax
information to small businesses including forms, instructions, and
publications. The CD also provides valuable business information
from a variety of government agencies, non-profit organizations, and
educational institutions. The CD contains essential startup
information needed by new small businesses in order to be
successful. The design of the CD makes finding information easy and
quick and incorporates file formats and browsers which can be run on
virtually any desktop or laptop computer"
You can order up
to five free copies of this product at:
http://www.irs.gov/businesses/small/display/0,,i1%3D2%26i2%3D23%26genericId%3D7128,00.html
Other government
prepared CD-Rom products are shown on:
http://www.irs.gov/businesses/small/display/0,,i1=2&i2=23&genericId=20005,00.html
Victorious Taxpayer Issues IRS Survival Guide ---
http://www.smartpros.com/x33474.xml
The booklet is useful if the IRS notifies you that you
are being audited. It is available online ($4.95) and in printed form
($5.95) on http://www.taxrevue.com/.
Rich's IRS Survival Coaching Services are also available by phone.
Money Guide to Taxes
http://www.netguide.com/Money/taxes
- Dennis Schmidt's Accounting and Tax Guide
-
-
There
is a great review of tax software in the following cover story:
"Ranking
the Products," by Stanley Zarowin, Journal of Accountancy,
October 2001, pp. 28-32 ---
http://www.aicpa.org/pubs/jofa/oct2001/zarowin.htm
Vendor |
Tax
program |
Address |
Telephone |
E-mail
address |
ATX Forms |
Saber,
Max and Taxsolver |
PO
Box 1040, Caribou, ME 04736 |
800-944-8883 |
sales@atxforms.com |
CCH |
ProSystem
fx |
21250
Hawthorne Blvd., Torrance, CA 90503 |
800-457-7639 |
cust_serv@cch.com |
Creative Solutions |
UltraTax |
7322
Newman Blvd., Dexter, MI 48130 |
800-968-8900 |
sales@CreativeSolutions.com |
Drake Software |
Drake
Tax Solution |
235
E. Palmer St., Franklin, NC 28734 |
800-890-9500 |
drakeinfo@drake-software.com |
Dunphy Systems |
1040
Professional Tax Preparation |
6740
Huntley Rd., Suite 103, Columbus, OH 43229 |
614-431-0846 |
dunphy@dunphy.com |
Intuit |
ProSeries |
2535
Garcia Ave., Mountain View, CA 94043 |
800-934-1040 |
www.proseries.com |
Lacerte/Intuit |
Lacerte
1040 Tax Software |
13155
Noel Rd., 22nd Floor, Dallas, TX 75244 |
800-765-7777 |
www.lscsoft.com |
Micro
Vision Software |
Tax
Relief 1040 |
140
Fell Court, Hauppauge, NY 11788 |
800-829-7354 |
www.microvisioninc.com |
Orrtax Software |
IntelliTax |
13208
NE 20th St., Bellevue, WA 98005 |
800-377-3337 |
webmaster@orrtax.com |
TaxACT |
2nd
Story Software |
5925
Dry Creek Lane, NE, Cedar Rapids, IA 52402 |
800-573-4287 |
www.taxact.com |
Taxworks
By Laser Systems |
TaxWorks
By Laser Systems |
350
North 400 West, Kaysville, UT 84037 |
800-230-2322 |
www.taxworks.com |
Universal Tax Systems |
TaxWise |
6
Mathis Dr. NW, PO Box 2729, Rome, GA 30164 |
800-755-9473 |
sales@universalsystems.com |
Xpress
Software |
Xpress
Individual Package |
P.O.
Box 280760, Columbia, SC 29228 |
800-285-1065 |
www.xpresssoftware.com |
Please add a link to my web site in your
Accounting, Finance and Business section under Miscellaneous
Taxation Web Sites ---
www.funwithtaxes.com
Thank you!
Gail Perry, CPA
Tax columnist for the
Indianapolis Star
Tax Time 2002 http://lii.org/taxes
Tax Links for the U.K. --
http://www.accountingweb.co.uk/cgi-bin/item.cgi?id=13447&d=182
There are more extensive and expensive web sites on taxation and tax research.
Some of the heavy duty alternatives discussed by Barbara
Karlin at the ATA in San Francisco include the following:.
http://www.taxsites.com/
http://www.taxresources.com/
http://www.abanet.org/tax/sites.html
http://www.willyancey.com/
Sharing Tax Accounting and Technology Professional Gene Prescott
--- http://www.taxtechcpa.com/index.html
Will Yancey lists a bunch of tax professor web sites at
http://www.willyancey.com/
Since I do not teach taxation, I hesitate to pick out the leading educator web sites in
this area. I will, however, repeat the links to three of my friends who teach
taxation.
Amy Dunbar at
http://www.sba.uconn.edu/users/ADunbar/dunbaru.htm
Tom Omer at http://omer.actg.uic.edu/
Mark Wolfson at
http://gobi.stanford.edu/facultybios/bio.asp?ID=168
Look up the financial reports,
budgeting information, and names of officers in your
favorite college, charity, church, or other non-profit organization.
These organizations must file a Form 990
with the IRS and, thereby, are on the web. For short and easy-to-find
summaries see http://www.guidestar.org/index.html
Posting Form 990
images is an ongoing process. If a Form 990 image is available for your
selected charity, you will see a "Form 990" option on the left side
of its GuideStar Pages™. More images are being added to the database.
Meanwhile, you will find easy-to-read profiles and financial reports derived
from IRS Forms 990 by searching for an organization and reading its GuideStar
Pages.
Searchable Database
2005/2006 Compensation of Presidents of Private Institutions ---
http://www.insidehighered.com/news/2007/12/31/qt
Searchable Database
Compensation of Presidents of Higher Education Institutions ---
http://chronicle.com/stats/990/
How to check on a charity or church or college before you donate:
You can begin with IRS Form 990 disclosures, but these sometimes may be more misleading than helpful.
You can access them from Guidestar at http://www.guidestar.org/index.jsp
One problem is that reported "compensation" for executives may not include free houses, free cars, and free services like lawn care and catering.
Another problem is that rich alumni may provide college executives with free condo use, airline tickets, and club memberships.
Guidestar also provides salary disclosures for top executives in the non-profit organization.
However, funds can (such as charity crooks) can be diverted by cheats in other ways.
Research Tools
Analyst Reports
Charity Check
Grant Explorer
Data Services
Nonprofit Compensation Reports
Salary Search
Linda Phingst sent me a link to another
source for Form 990 copies. Go to http://www.nccs.urban.org.
What does hedonism have to do with
taxation?
"The Tax Man vs. Hedonists Liquid Engines Inc. can't do much
about death, but corporate taxes are another matter."
John P. Mello Jr., CFO Magazine August 26, 2003 ---
http://www.cfo.com/printarticle/0,5317,10492|,00.html?f=options
At a time when technology start-ups are
rare and technological innovation even rarer, this Sunnyvale,
Calif.-based company plans to launch an entire suite of products
designed to help companies manage financial performance. The first
product, out later this month, is tax-planning software that can,
Liquid Engines claims, fully analyze in 5 to 10 minutes the kinds of
mind-numbing tax situations that typically keep teams of consultants
busy for weeks — situations involving perhaps scores of business
units operating across dozens of states, each with hundreds of
unique tax regulations.
Relying on a powerful econometric modeling
technique called hedonics, the software can cope with any number of
financial constraints and variables and zero in on the optimal
solution to virtually any corporate tax-planning problem, claims CEO
Joe Fantuzzi.
Hedonics, which originated in the 1950s, is
a technique that is now closely associated with Stanford Graduate
School of Business. Derived from hedon, the Greek word for pleasure,
hedonics has proven itself to be a powerful tool for analyzing
prices and consumer choice in such markets as housing and personal
computers, where many qualitative factors contribute, each with a
different weight, to the perceived value of products. The price of a
house, for instance, may reflect its distance from a train station,
the quality of nearby schools, its age, and neighborhood
demographics.
So Liquid Engines's software assigns
weights to the many financial conditions and outside business
factors, some of them not easily quantified, that affect taxes and
cash flows. The technical challenge has been to encode the
matrix-intensive hedonics algorithm in software that rapidly finds
optimum solutions. The company has been helped by two Nobel
laureates from Stanford: Liquid Engines board member A. Michael
Spence and technical adviser Myron Scholes, known best for his work
on the Black-Scholes options-pricing model.
Miscellaneous Taxation Web Sites
A helpful site for U.S. taxpayers (download forms, instructions, FAQs, tax
tables, IRS publication guides, etc.) ---- WorldWideWeb Tax [.pdf]
http://www.wwwebtax.com/
-
IRS - The Digital
Daily: Income Tax Forms, Instructions, Publications, Regulations, and other stuff
United States Tax Court
http://www.ustaxcourt.gov/
Tax Helpers from the University of Illinois at Chicago
http://www.uic.edu/depts/lib/collections/govdocs/tax/index.html
Tips from Microsoft on how to avoid tax audits
http://moneycentral.msn.com/articles/tax/prepare/1384.asp
FIN 48
October 21, 2009 message from Dennis Beresford
[dberesfo@TERRY.UGA.EDU]
IRS Commissioner Doug Shulman spoke at
a conference of the National Association of Corporate Directors
that I attended earlier this week. He covered the income tax
risk issues that directors should be concerned about. I thought
this was a very good summary of both what auditors and tax
accountants should be interested in and I refer interested
parties to his posted remarks at:
http://media-newswire.com/release_1103133.html
Denny Beresford
- The Tax History Project
http://www.taxhistory.org/
-
Digital Daily Welcome - IRS
-
Tax and Accounting Sites Directory
Tax Resources
CHECKPOINT
-
JohnSon's Tax Page
-
Tax Analysts' Discussion Groups
-
Tax and Accounting
Sites
-
John Gill's tax education page
-
Tax Resources (U. of
Iowa)
-
Tax World Homepage
-
Tax World Homepage (Omer)
-
Taxing Times 1996
-
TaxSites - Internet
income tax related information available on Internet
-
The Tax History (Includes Presidential
Tax Returns)
-
U.S. House of Representatives - Internet
Law Library - Code of Federal Regulations (searchable)
-
U.S. Tax Code
On-Line
-
Master of Business Taxation Degree
Program University of Minnesota
-
American College of Trust & Estate
Counsel (ACTEC)
-
Americans for Tax Reform
-
U.S. House of Representatives Internet
Law Library
-
Cato Project On Social Security
Privatization
-
Tax Analysts Home Page
-
Tax Analysts Discussion Groups
-
The Tax History Project at Tax Analysts
-
Today's Tax News
-
Tax Calendar
-
Tax Analysts Tax Clinic
-
Tax Quotations -- Presented by Tax
Analysts
-
The World Wide Web
Virtual Library: Law: Taxation
-
University Law Review Project
-
FarisLaw
-
Law & Estate Planning Sites (Mark
Welch's Links)
-
Emory Law School Tax Server
-
Robert Clofine's Estate Planning Page
-
Tax and Accounting Sites Directory
-
Tax & Estate Planning Resources on
the WWW
-
Tax Court Rules
Table of Contents
-
Tax-Related Primary
Sources on the Internet
-
TaxSites - Internet
income tax related information available on Internet
-
TaxSites [Framed]
-
Estate Planning
Links Web Site
-
The Tax Prophet®
-
Will Yancey's Home Page
-
PM&S Tax Page
-
Deloitte & Touche's Tax News &
Views
-
TaxWeb: Federal & State Tax Forms
-
1997 State and Local
Government Finance Estimates, by State
-
IRS - The Digital
Daily: Income Tax Forms, Instructions, Publications, Regulations, and other stuff
-
JohnSon's Tax Page
-
Tax Analysts' Discussion Groups
-
Tax and Accounting
Sites
-
Tax World Homepage
-
Taxing Times 1996
-
TaxSites - Internet
income tax related information available on Internet
-
The Tax History (Includes Presidential
Tax Returns)
-
U.S. House of Representatives - Internet
Law Library - Code of Federal Regulations (searchable)
-
U.S. Tax Code
On-Line
ABA LawInfo.org
--- http://www.abalawinfo.org/
Your gateway to information on legal
topics that affect your daily life.
-
- From the Scout Report
Global Financial Data [.pdf]
http://www.globalfindata.com/
This impressive collection of historical
global financial data stretches from the years 1264 to 2000. While
most of the actual data must be purchased, this Website does offer
several free series, including Stock Markets since 1693, Interest
Rates since 1700, and Inflation Rates since 1264. The site also
contains a decent-sized collection of research papers written about
the Eurodollar and a links page with financial Websites from around
the world.
-
-
Tax Cape is an interesting website from the standpoint of
international financing and taxation. Among other things it compares 50
leading financial sites around the world ---
http://www.taxcape.com/
I received this email requesting that I add this message
to New Bookmarks:
Your TaxCape Team
TaxCape Anstalt
http://www.taxcape.com
Landstrasse 30 FL-9494 Schaan Furstentum Liechtenstein
Tel.: +423 238 11 68; Fax: +423 238 11 69
mailto:info@taxcape.com
-
- http://faculty.trinity.edu/rjensen/default4.htm
-
- Tools for Finding Indexed Accounting Research
http://www.rutgers.edu/Accounting/raw/aaa/facdev/research/indexed.htm
Investing in E-Commerce and other technologies poses
huge problems for business decision makers, because the popular investment criteria such
as Return on Investment (ROI) are so difficult to compute and there are so many
uncertainties about both investments and returns. These topics make interesting case
studies in both managerial accounting and accounting information systems courses.
Two articles of interest are as follows:
"E-Commerce: New Sense of Urgency Companies Rush For
Online Market Share Flurry of multimillion-dollar deals signals new effort to be
competitive in E-commerce," by Clinton Wilder in Information Week, May 24,
1999, 48-56.
"Rethinking ROI Some projects have become so important
that companies are looking for new ways to measure their return on investment--or are
dispensing wtih ROI studies completely," by Tom Stein in Information Week,
May 24, 1999, 59-68.
Both articles deal with problems of ROI as a criterion for
investment decisions and performance evaluation. The online versions of these
articles can be found at
http://www.informationweek.com/maindocs/index_735.htm
-
- Audit Committee Oversight Responsibilities Checklist
http://www.fei.org/download/iia_2_13_04.pdf
-
- The mortgage helpers
were moved to
http://faculty.trinity.edu/rjensen/FraudReporting.htm#MortgageAdvice
Mortgage Professor's Tips on Whether or Not to Pay Off
Your Mortgage Early ---
http://www.mtgprofessor.com/early_payoff.htm
How Mortgages Work ---
http://money.howstuffworks.com/mortgage.htm
What are current mortgage rates? ---
http://biz.yahoo.com/b/r/m.html
Also see
http://www.mortgageloan.com/
Mortgage Professor's Tips on Whether or Not to Pay
Off Your Mortgage Early ---
http://www.mtgprofessor.com/early_payoff.htm
How Mortgages Work ---
http://money.howstuffworks.com/mortgage.htm
What are current mortgage rates? ---
http://biz.yahoo.com/b/r/m.html
Also see MortgageLoan.com ---
http://www.mortgageloan.com/
Bob Jensen's additional links for mortgage advice ---
http://faculty.trinity.edu/rjensen/FraudReporting.htm#MortgageAdvice
Bob Jensen's threads on Internet frauds are at
http://faculty.trinity.edu/rjensen/FraudReporting.htm
CNBC Investment Helpers ---
http://www.cnbc.com/id/15840232?video=922873186
Good Advice Site: Free Money Finance. Free Money Finance
--- http://www.freemoneyfinance.com/
Top 10 Places to Look for Stock Prices ---
http://search.nola.info/?t=share%20prices
One opinion on the top 10 investment
resource sites.
InvestMove.com --- www.investmove.com
Top 50 Financial Websites --- Money.com
http://www.money.com/money/depts/websmart/bestweb/index.html
Geoportals.com (Guides to
Investment Links) --- http://www.geoinvest.com/
At Stanford University many years ago, I had
a classmate named Randy Johnson. Randy has had great success with two
best-selling mortgage books. He also maintains a very helpful helper
site on mortgages --- http://www.loan-wolf.com/
Mutual Fund Investing Helpers from Consumer
Reports "Survival of the Fittest"
http://www.consumerreports.org/Special/Samples/Reports/0103mut0.html
Dear Bob,
Hi, I know I recently contacted you regarding
receiving press releases and that somebody else has also contacted you
regarding a reciprocal link exchange. The reason that I am contacting you
now is because I would also like to tell you about a free service that we
are offering to technology-related sites.
ITtoolbox Data Feed delivers relevant news,
industry documents and/or custom stock indices directly to your website.
Content for the data feed is constantly updated, providing fresh content
to your site daily. Although the Data Feed offers information for more
than 20 areas in information technology, you will be able to select and
customize the information that you present, extending your site’s
diversity and adding to your user’s experience. If you would like to
implement or even see what this free service would look like on your site,
please go to http://datafeed.ITtoolbox.com, and follow the directions
provided, at the URL prompt, type ".test" If you have any
questions, about the service, please do not hesitate to contact me.
I look forward to any feedback on our network and
the possibility of working with you in a mutually beneficial relationship.
Try out our Data Feed, and let me know what you
think! Hope to hear from you soon!
Michelle Stanton
www.ITtoolbox.com
(610) 280-9517
NASDAQ-100 Dynamic Heatmap® Explore our ETF
Heatmap and our NASDAQ-100 Pre-Market Heatmap View the price of companies in the
NASDAQ-100 Index at a glance. Each colored rectangle represents an individual
company that is part of the NASDAQ-100 ---
http://screening.nasdaq.com/heatmaps/heatmap_100.asp
Downside: The Investor's Reality Check ---
http://www.downside.com/
Includes a cash flow death watch.
Why hasn't all the air come
out of the market bubble yet? In the June 28th issue of The Economist, (p. 25),
we read this: "The Fed, it seems, will stop at nothing to keep the
post-bubble economy afloat. ... After playing an key role in nurturing the
equity bubble of the late 1990s by holding down interest rates, it has since
propped up the economy by furthering first a property bubble and then a bond
bubble." This article is worth a close read.
From PBS --- The History of Old Money versus Newer
Electronic Money --- http://www.pbs.org/opb/electricmoney/
From the Scout Report on May 17,
2001
FundAlarm
http://www.fundalarm.com/
While most mutual fund information Websites will
tell you when you should buy mutual funds, FundAlarm, created and
maintained by Roy Weitz, CPA, offers news and information that will help
users make informed decisions about selling their mutual finds. Along with
a database of nearly 4,000 data tables of stocks and balanced mutual
finds, FundAlarm also provides three lists of mutual funds: those that
should be sold right away, those to keep, and mutual funds that are merely
strong candidates for
The University of Kansas International Business Resource Connection
http://www.ibrc.bschool.ukans.edu/
The IBRC, a business outreach program of the Center for
International Business Education and Research (CIBER) within the
School
of Business at the University of Kansas,
was created to encourage trade opportunities and expand international business
education. Through strategic alliances with major partners (including the
U.S.
Department of Education and the Kauffman
Foundation), private sector affiliates, faculty and students at the
University of Kansas, the IBRC assists small and medium-sized Kansas companies
explore available trade opportunities and broaden international business skills.
Particular emphasis is placed on the emerging role of electronic communication
resources (the Internet) in developing international business opportunities for
firms located in the heartland of the United States.
Also, don't
forget Paul Pacter's great international accounting site at
http://www.iasplus.com/
-
-
Bob
Jensen's threads on accounting practice, consultation, and financial
planning are at
http://faculty.trinity.edu/rjensen/fees.htm
-
-
Financial
Executives International (FEI) ---
http://www.fei.org/
- Newsletter FEI Express ---
http://www.fei.org/newsletters/default.cfm
The FEI Teleconference Archive of the Financial Executives Institute
You can download the RealAudio files or the transcripts.
http://www.fei.org/tc/
- South Texas (San Antonio) Chapter ---
San
Antonio Chapter Information
http://www.fei.org/chapter/SanAntonio/
-
IOSCO Home Page
-
Welcome to NACUBO!
-
US Securities and Exchange Commission
UAW Demo (Financial Analysis Updates)
-
Alliance
of Business Women International
-
Associated Colleges of the South
American Association of
Individual Investors --- http://www.aaii.org/
Business
Firm and Other Directories
- ABA LawInfo.org ---
http://www.abalawinfo.org/
Your gateway to information on legal topics
that affect your daily life.
Free estate planning helpers from a Georgia law firm ---
http://www.scrogginlaw.com/
-
-
How to find an organization
Businesses
http://www.business.com/
http://dir.yahoo.com/Business_and_Economy/Directories/
Not-for-Profit Organizations
http://www.icnl.org/
If you know the name of a
non-profit organization, you can find a raft of data in their IRS 990
tax returns at http://www.guidestar.org/index.jsp
Bob Jensen's helpers on finding investment help ---
http://faculty.trinity.edu/rjensen/fees.htm
Bob Jensen's threads on consumer
fraud prevention and reporting are at
http://faculty.trinity.edu/rjensen/FraudReporting.htm
The New Google Stock Screener (sort of nice as
online screeners go) ---
Click Here
A Blog for Students of
Investment Strategies ---
http://bonasimm.blogspot.com/
20 timeless money rules
Money Magazine collected the best advice from some of
the smartest investors (and other people) who have ever lived.
Carla Fried,
Money Magazine, August 2007 ---
http://money.cnn.com/galleries/2007/moneymag/0708/gallery.20_rules.moneymag/index.html
"10 reasons people make stupid decisions," Bad Analysis,
October 10, 2006 ---
http://badanalysis.blogspot.com/2006/10/10-reasons-your-co-workers-make-stupid.html
Top 100 Economics Blogs ---
http://www.currencytrading.net/2007/the-top-100-economics-blogs/
Bob Jensen's threads on blogs and listservs ---
http://faculty.trinity.edu/rjensen/ListServRoles.htm
DealBook is a financial news service produced by The New York Times.
It is published daily, Monday-Friday, except on U.S. Market holidays and during
the last week of the year. A daily digest of DealBook is also available via
email, delivered before the market opens.
The New York Times ---
http://dealbook.blogs.nytimes.com/
There's a shelf of financial bestsellers whose
titles now sound absurd: Ravi Batra's The Great Depression of 1990; James
Glassman's Dow 36,000; Harry Figgie's Bankruptcy 1995: The Coming Collapse of
America and How to Stop It. There’s BusinessWeek’s 1979 description of "the
death of equities as a near permanent condition,
Michael Lewis, "The Evolution of an
Investor," Blaine-Lourd Profile, December 2007 ---
http://www.portfolio.com/executives/features/2007/11/19/Blaine-Lourd-Profile#page3
As quoted by Jim Mahar in his Finance Professor Blog at
http://financeprofessorblog.blogspot.com/
As a group, professional
money managers control more than 90 percent of the U.S.
stock market. By definition, the money they invest
yields returns equal to those of the market as a whole,
minus whatever fees investors pay them for their
services. This simple math, you might think, would lead
investors to pay professional money managers less and
less. Instead, they pay them more and more...Nobody
knows which stock is going to go up. Nobody knows what
the market as a whole is going to do, not even Warren
Buffett. A handful of people with amazing track records
isn’t evidence that people can game the market. Nobody
knows which company will prove a good long-term
investment. Even Buffett’s genius lies more in running
businesses than in picking stocks. But in the investing
world, that is ignored. Wall Street, with its army of
brokers, analysts, and advisers funneling trillions of
dollars into mutual funds, hedge funds, and private
equity funds, is an elaborate fraud.
Michael Lewis,
"The Evolution of an Investor," Blaine-Lourd Profile,
December 2007 ---
http://www.portfolio.com/executives/features/2007/11/19/Blaine-Lourd-Profile#page3
As quoted by Jim Mahar in his Finance Professor Blog at
http://financeprofessorblog.blogspot.com/
Question
What is the AICPA's feed the pig initiative?
November 8, 2006 message from Barry Rice
[BRice@LOYOLA.EDU]
Who says CPAs don't have a sense of humor?
* * *
Feed the Pig
is a new national public service
campaign from the American Institute of Certified Public Accountants (AICPA)
and The Advertising Council to encourage the 40 million Americans age 25
to 34 to take control of their personal finances. The campaign is a new
component of the
360 Degrees of Financial Literacy
effort,
which offers free tools and resources to help Americans manage their
finances through every stage of life.
The
American Institute of Certified Public Accountants (AICPA)
is the national professional association of CPAs, with approximately
330,000 members in business, industry, public practice, government and
education. The AICPA sets the ethical standards for the profession and
theauditing standards for private companies, non-profit groups, and
federal, state and local governments.
The Advertising Council
has produced thousands
of PSA campaigns addressing the most pressing social issues of the day.
The Ad Council aims to foster tremendous positive change by raising
awareness, inspiring action and saving lives.
For more information about this campaign,
please contact
feedthepig@aicpa.org
or visit
www.feedthepig.org
Barry Rice
November 8, 2006 reply from Bob Jensen
Hello Barry,
It's become a rare even to hear from the
Founding Father of the AECM, and it's great to know that you're alive
and well.
I'm old enough to remember when Bill Paton, a
powerhouse on the University of Michigan campus, in the middle of the
20th Century, made a push to require basic accounting for every student
on campus. In the 21st Century I would not advocate this for basic
accounting, but I do think it is very important to require all students
to take a course in personal finance and taxation. Even our accounting
students (who do not face the short-skirt, fish net stockings dilemma
mentioned by Catlin below) still are incredibly weak in personal finance
and have difficulty managing their own financial affairs for the
long-term future. For example, how many of them can effectively argue
against the clever and highly misleading "investment advisor education
infomercials and scams," the dirty tricks of credit card companies, and
FICO fraud? Arthur Levitt claims says society is too easily seduced.
"I don't see frankly much out there that really does
the job, and that's partially because investors are their own worst enemy," says
former SEC Chairman Arthur Levitt. "They refuse to invest skeptically, and are
too easily seduced by all the purveyors of financial products that prey upon
their worst instincts."
"Investor Education 101: How to Avoid Scams: Outreach Programs
Target Most-Vulnerable Americans, But Success Is Hard to Assess," By Lynn
Cowan, The Wall Street Journal, May 9, 2006; Page D3 ---
http://online.wsj.com/article/SB114713241888747241.html?mod=todays_us_personal_journal
My case is strongly supported by Catlin
Petre's recent article in Newsweek Magazine, November 13, 2006,
pp. 16-17 ---
http://www.msnbc.msn.com/id/15565824/site/newsweek/
When I got my first job after graduating, I found that
life's real tests start when final exams end.
My friends and I are incredibly lucky to
have gotten the educations we have. But there's a discrepancy
between what we learn in school and what we need to know for
work, and there must be some way for universities to bridge this
gap. They might, for example, offer
classes in personal finance as part of the economics department.
When I got my first job after graduating, I found that
life's real tests start when final exams end.
Nov.
13, 2006 issue - To think there was once a time when I
thought nailing the interview was the hardest part of
getting a job. I recently applied to be a cocktail waitress
at an upscale bowling alley in Manhattan. After a brief
interview, the manager congratulated me, saying I'd be a
great fit. It was only a momentary victory. She produced a
sheaf of papers, and my stomach turned flips. I knew what
was coming—the dreaded W-4. I'd filled them out before, for
various summer jobs, but I'd always been exempted from taxes
because I was a full-time student. Now that I had graduated
from college, this was the first W-4 I had to complete
fully.
The
manager watched as I hesitated. "Are you having trouble?"
she asked as I squinted at the tiny print. "Oh, no, I'm
fine." I stared at the form, trying to figure out how many
allowances to claim—or what an allowance was, for that
matter. I didn't want to admit that I was stumped, so
finally I just took a guess.
Later I asked my friends to shed some light on the matter,
but none of them knew any more than I did. Instead, they
advised me to do what they did: make it up and hope for the
best. So much for being a well-educated college graduate.
Having taken seminars on government, I could hold forth on
the relationship between taxation and the federal deficit
but was clueless about filling out a basic tax form. I'd
graduated with a B.A. in philosophy in May, and had decided
against going straight to graduate school. But while
countless newspapers claimed that the job market for
graduates was the best it had been in years, I had no idea
how to take advantage of it. I couldn't imagine myself in an
entry-level administrative position staring at a spreadsheet
for eight hours a day—partly because it sounded dull, but
also because in college I had never learned how to use
spreadsheet programs. Cocktail waitressing seemed like a
good way to make ends meet.
My
friends and I are graduates of Wesleyan, Barnard, Stanford
and Yale. We've earned 3.9 GPAs and won academic awards. Yet
none of us knows what a Roth IRA is or can master a basic
tax form. And heaven help us when April comes and we have to
file tax returns.
My
friends and I are incredibly lucky to have gotten the
educations we have. But there's a discrepancy between what
we learn in school and what we need to know for work, and
there must be some way for universities to bridge this gap.
They might, for example, offer classes in personal finance
as part of the economics department. How about a class on
renting an apartment? Granted, it might be hard to lure
students to such mundane offerings, but the students who
don't go will wish they had.
College students are graduating with greater debt than ever
before, yet we haven't learned how to manage our money. We
can wing it for only so long before employers start wising
up to our real-world incompetence. In fact, they already
are: a study released last month showed that hundreds of
employers have found their college-graduate hires to be
"woefully unprepared" for the job market.
All
this raises a disturbing question: when I spent a ton of
time and money on my fancy degree, what exactly was I
buying? The ability to think, some might say. OK, fine,
that's important. Still, my résumé would look odd if it
read, "Skills: proficient in French, word processing,
thinking." The thinking I did in college seems to be of
limited utility in the "real world." The fact that I wrote a
30-page critical analysis of the function of shame in
society did nothing to ease the sting when I spilled beer on
a customer at the bowling alley.
That's not the only time I've found my education
incompatible with real life. I had trouble getting used to
my new uniform, which consists of a supershort '50s-style
bowling skirt, boots and fishnet stockings. As I changed
into it for the first time, I had a vision of the feminist
philosophers I had read in college hovering over me, shaking
their heads disapprovingly.
But
it wasn't long before I began to see that the short skirt
played a role in boosting my tips—a definite plus now that I
was trying to rent an apartment, feed myself and buy the
occasional book or new toothbrush.
So
which to live by: the philosophers or the skirt? I'm trying
to fashion some combination, one that allows me to retain my
principles without having to file for bankruptcy. After all,
the last thing I want is to be confronted with more
confusing government paperwork.
|
My helpers for investors are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm
My advice on mortgages is at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#mortgages
My warnings for on dirty secrets of credit
card companies and credit rating agencies are at
http://faculty.trinity.edu/rjensen/FraudReporting.htm#FICO
Hope to hear more from you in the future
Barry!
Bob Jensen
One opinion on the top 10 investment
resource sites.
InvestMove.com --- www.investmove.com
BigCharts ---
http://bigcharts.marketwatch.com/
The Google Finance
site is at http://finance.google.com/finance
Financial Markets in a New Age of Oil ---
http://siteresources.worldbank.org/INTMENA/Resources/MainReport.pdf
The Digital Duo has a video on how to manage your money with a computer
on the Web ---
http://www.pcworld.com/digitalduo/video/0,segid,216,00.asp
Heavily featured are bank rate finders, annuities information, and
financial portals.
Investment Helper Site from the National Association of Securities Dealers
--- http://www.nasdr.com/
Teach Your Children to Invest ---
http://www.aaii.com/promo/20011119/feature2.shtml
"AICPA Launches New Website '360 Degrees of Financial Literacy',"
AccountingWeb,
October 26, 2004 --- http://www.accountingweb.com/cgi-bin/item.cgi?id=99979
As part of its on-going efforts to improve the
financial health of Americans across all life stages and socio-economic
levels, the American Institute of Certified Public Accountants (AICPA) and
the CPA profession went live this week with its new consumer website.
The 360 Degrees of Financial Literacy website
allows visitors to immediately pinpoint the financial information they need
because it is organized by common life stages that trigger financial issues:
childhood, college, career, military and reserves, couples and marriage,
parenthood, home ownership, entrepreneurs, life crisis, sandwich generation
and retirement.
The website is the linchpin of a coordinated
program, 360 Degrees of Financial Literacy, sponsored by the AICPA and state
societies of CPAs across the nation in which CPAs volunteer their time and
talents to educate members of their
community about life-stage related financial issues.
Visitors to the site will be able to access
information geared toward empowering them to make better financial choices
to meet their present and future needs. Each life stage contains: articles;
easy-to-use financial planning and assessment tools, worksheets and
calculators; and frequently asked questions. In addition, the site allows
visitors to access topics of general financial interest such as strategies
for saving and investing, financing a
car, managing credit and getting out of debt.
You may visit the site at
www.360financialliteracy.org
-
Investment Research Resources
-
The Google Finance
site is at http://finance.google.com/finance
CNNfn
-
Datek
/ Zacks
-
Fianancial
Web
-
Hoover's
Online
-
Market
Guide Inc.
-
MSN
Investor
-
Stock
Site
-
Trading
Day
-
Wall
Street City
-
Wall
Street Research Net
BigCharts ---
http://bigcharts.marketwatch.com/
-
Big
Charts
-
Fianancial
Web
-
IQC
Historical Quotes
-
Stock
Site
-
Trading
Day
-
Wall
Street City
-
Wall
Street Research Net
-
10k
Wizard
-
EDGAR
Database
-
EDGAR
Online - People
-
First
Call
-
InsiderTrader
-
Big
Charts
-
Bloomberg
-
Wall
Street City
-
-
Big
Charts
-
Citicorp
-
CNNfn
-
Corporate
Information
-
Daily
Stocks
-
Equityweb
-
Fat's
Financial Directory
-
Financial
Web
-
Hoover's
Online
-
Intellifact
-
Investor
Home
-
Invest-o-rama!
-
JustQuoteMe
-
Market
Guide Inc.
-
MSN
Investor
-
Netscape
- Business
-
Nordby
-
PC
Quote
-
Planet
Direct
-
Quicken
-
Quote.com
-
Reuters
Moneynet
-
Stock
Master
-
Stock
Quotes
-
Stock
Selector
-
Stock
Site
-
Stockpoint
-
Trade
N Post
-
Trading
Day
-
Wall-Street.com
-
Wall
Street City
-
Wall
Street Research Net
-
Washington
Post
-
Wright
Research Center
-
Yahoo!
Finance
-
Zacks
Free Resear
- Industry Research
-
14
Steps for Researching an Industry
-
Boston
University
-
Ithaca
College
-
Learning
About an Industry
-
Santa
Clara University
-
University
of Pittsburgh
-
What
is Market Research?
-
About.com
- Industries/Professions
-
CNNfn
- Industry Watch
-
Current
Industrial Reports
-
Datek
- News By Industry
-
Deloitte
& Touche - PeerScape
-
Dow
Jones
-
FindLinks
- Industry-Specific Web Links
-
FRB
- Beige Book
-
Hoover's
- Industry Zone
-
Industry
Link
-
Industry
Research Desk
-
Intellifact.com
Market Research
-
International
Trade Administration
-
Investext
-
iMarket
Inc.
-
MarketingBASE
-
Motley
Fool - Industry Snapshot
-
Quote.com
-
NewsPage
-
Standard
& Poor's DRI Home Page
-
U.S.
Census Bureau - American FactFinder
-
U.S.
Industry & Trade Outlook
-
WEFA
-
Yahoo!
- Business and Economy:Companies
-
Yahoo!
- Industry News
-
Yahoo!
- Research by Industry
-
Invest-o-rama!
stock screening
-
Hoover's
Online: StockScreener
-
Market
Guide Inc.- Stock Screening
-
MSN
Investor (Finder)
-
Stock
Selector
-
Stock
Tools
-
Wall
Street City
-
Trade Associations
-
-
Associations
Online
-
ASAE's
Gateway to Associations
-
Better
Business Bureau
-
Chambers
of Commerce
-
GuideStar
-
Industry.net
(Site Map)
-
IPL
Associations on the Net
-
Virtual
Community of Associations (VCA)
-
World
Chambers Network
Financial and Economic News
-
The Google Finance
site is at
http://finance.google.com/finance
Business
Week
-
Business
Wire
-
Companies
Online Search
-
Data
Broadcasting Corporation
-
Forbes
-
Fortune
-
Excite
- NewsTracker
-
Kiplinger
-
MSNBC
-
National
Public Radio
-
Netscape
- Business Journal
-
NewsEdge
- NewsPage
-
Northern
Light
-
PBS
Online
-
PR
Newswire
-
RealGuide
- News
-
Zacks
Investment Research
-
ABC
News
-
Associated
Press
-
Barrons
-
Bloomberg
-
Chicago
Tribune
-
CNBC
-
CNN
-
CNNfn
-
Discovery
-
Drudge
Retort
-
Economist
-
Financial
Times
-
Los
Angeles Times
-
Moody's
-
New
York Times
-
Online
Gateway
-
Political
Junkie
-
Red
Herring
-
Time
-
US
Newswire
-
USA
Today
-
Wall
Street Journal
SIC Codes
-
SIC
and NAICS Codes
-
SIC
- OSHA
-
SIC
- Sites
Tutorials and Education
Tutorials on Investing, Portfolio
Management, and Personal Finance
Bonehead Finance ---
http://ourworld.compuserve.com/homepages/Bonehead_Finance/
Strategies and Tactics ---
http://www.strategies-tactics.com/
Investor Solutions Inc. (Asset
Management) --- http://www.fee-only-advisor.com/
American Association of
Individual Investors --- http://www.aaii.org/
Where to find financial statements in different countries:
http://www.cnmv.es
http://www.sib.co.uk
http://www.cob.fr
http://www.rmc.es
http://www.infogreffe.fr
http://www.companies-house.co.uk
http://www.infocamere.it
http://www.publi-com.dk
http://www.powernet.ch
Geoportals.com (Guides to
Investment Links) --- http://www.geoinvest.com/
eFinancial News
http://www.efinancialnews.com/
Financial Risk Links ---
http://victoryrisk.com/
Advanced Stock Information
http://www.stockadvanced.com/
(note that ratios are available)
Enter a symbol and click "go!" to get the
following information: Stock Prices, Options, Stock Splits, Charts, Live Stock
Quotes, Stock Performance, Earnings Estimates, Analyst Opinions, Company
Performance, Stock Valuation, Broker Reports, Company Profile, Earnings Release
Dates, Latest News, Fundamentals, Intraday Charts, Forum Discussions, Technical
Charts, Annual Reports, Significant Events, Institutional Ownership, Financial
Ratios, Insider Trading, SEC Filings, Financial Statements, Stock Dividends,
Competition, Momentum Rating, Management Discussion, Conference Calls, Short
Interest, and more.
Bob Jensen's Threads on Accounting Fraud, Forensic Accounting,
Securities Fraud, and White Collar Crime --- http://faculty.trinity.edu/rjensen/fraud.htm
Bob Jensen's
Threads
on Fees and Choosing Accountants, Financial Advisors, and Consultants
--- http://faculty.trinity.edu/rjensen/fees.htm
Guides to using a financial calculator without having to be confused by the manual
http://moon.pepperdine.edu/~mkinsman/Using.html
Click here to view links to
online finance and investment calculators
The Education Alliance Network provides, free of cost, the
materials for colleges and universities to expose college-level students to financial
management software, helping them gain hands-on experience to real-world technologies.
http://www.gps.com/ean/
-
TIAA Helpers in Personal Finance (a blog)
---
https://www.tiaa.org/public/index.html?tc_mcid=se_b2cbau19_bing_71700000031942727_58700003826134503_76347400716128_personal+finance_c&gclid=CPn3zamd2t8CFY-zswodRtwLcg&gclsrc=ds
Bob Jensen's links about finding financial helpers can be found at
http://faculty.trinity.edu/rjensen/fees.htm
Bob Jensen's links to financial helpers can be found at
http://faculty.trinity.edu/rjensen/fees.htm (out
of date)
TED Talk: How to Take Charge of
Your Personal Finances ---
https://www.ted.com/playlists/685/how_to_take_charge_of_your_personal_finances?utm_source=newsletter_weekly_2019-01-26&utm_campaign=newsletter_weekly&utm_medium=email&utm_content=playlist_title
Librarians Say Information
Literacy Is Important, They Don't Have
the Tools to Teach It ---
https://thejournal.com/articles/2017/01/05/report-librarians-say-info-literacy-is-important-they-dont-have-the-tools-to-teach-it.aspx
Bob
Jensen Says Financial Literacy is
Important, and Perhaps We Have Too Many
Tools to Teach It
---
More
specifically we don't have a single site
or a single curriculum that stands out
above all others in the areas of
financial literacy and personal finance.
One problem is knowing how to choose the
best topics for different levels of
learning. One vital element is an
understanding of the time value of money
and how to use finance calculators
and/or spreadsheet software like Excel
to teach it. Another important element
is learning about how to borrow money
and calculate annual percentage rates
(APRs) on loans and savings. I
personally think it's vital to teach
when to buy versus rent a home. I think
it's vital to learn how to make purchase
verses leasing decisions for things like
cars.
More
uncertain topics include how deeply to
go into tax rules and advice.
More
uncertain topics include the financial
aspects of marriage and divorce.
Other
uncertain topics include how deeply to
go into retirement savings alternatives.
Other
uncertain topics include how deeply to
go into accounting and small business
management.
There are
many free sites, including my own at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Here’s What You’ll Pay for Health Care In
Retirement (Social Security benefits won't even cover your health care costs
if you add supplemental Medicare insurance (that I recommend by the way)) ---
http://time.com/money/4340299/what-youll-pay-healthcare-in-retirement/
Student Loans: What You Need to Know Before
Signing ---
http://www.journalofaccountancy.com/issues/2017/jan/student-loan-repayment.html?utm_source=mnl:cpald&utm_medium=email&utm_campaign=09Jan2017
Helpers for Student Loan
Forgiveness and Cancellation ---
https://www.moneygeek.com/education/college/resources/student-loan-forgiveness-cancellation/
Rob Gronkowski has saved all of
his $54 million in NFL earnings and has
simple advice for young players entering
the league ---
https://www.businessinsider.com/rob-gronkowski-contract-earnings-saved-advice-nfl-rookies-2018-10
Jensen Comment
Players should first of all be wary of
financial managers, especially those
willing to take on risky investments. My
advice to guys like Gronkowski is to be
more hands on in choosing their own
portfolios.
Players should diversify their
investments. Be wary of real estate for
various reasons, especially those annual
property taxes that can eat investors
alive.
Get a good tax advisor apart from a
financial advisor.
Don't use Michael Jordan as a role model
even though he's very, very wealthy.
Michael is too much of a gambler and
spendthrift.
Use Rob Gronkowski as a role model.
Players should consider putting a
considerable portion, certainly not all,
into tax exempt mutual funds that have
fairly high after-tax cash yields (e.g.,
those of Vanguard or Fidelity)
As they age to say over sixty they
should consider putting even larger
portions into tax exempt mutual funds.
As you age inflation risk is less of a
concern.
Players should resist temptations of
luxury houses, yachts, private jets,
cars, and gold diggers (if you catch my
drift). High life memories are probably
great, but memories of downfalls are
nightmares.
Beware of old "friends" that can become
leeches like the ones that brought down
Aaron Hernandez ---
https://en.wikipedia.org/wiki/Aaron_Hernandez
From the CPA Newsletter on November 19,
2015
US ranks 14th in
world for financial literacy
http://www.forbes.com/forbes/welcome/
The
US ranked 14th in a survey of global
financial literacy that was
conducted in more than 140
countries. The researchers asked
multiple-choice questions about
topics such as interest and
diversification. Only 57% of
Americans received a passing grade.
Find the AICPA's financial education
resources at
360financialliteracy.org.
Forbes
(11/18)
How little
couples talk about money. It’s probably
one of the last taboos except in heated
arguments after it's too late.
Suggestions for improving
communications with partners about money
http://www.forbes.com/sites/johnwasik/2016/09/16/how-much-do-you-need-for-retirement-communication-is-the-key/#558a3fc514eb
Jensen
Comment
I found the best way to communicate
about money with Erika was to let her
take over the checkbook years and years
ago even before we retired. That way
when I talked about long-range planning
her knowledge of the short-range ins and
outs made her much more sympathetic and
understanding about the long run. In the
short run, however, she still won't tell
me how much money is in the account ---
in fear that I might spend too much
foolishly if I know how much is
available. She let's me carry one check
in my billfold --- but that's strictly
for emergencies.
And what a relief it was to put bill
paying out of my mind.
Erika actually reconciles the checkbook
to the penny which is something that I
rounded off to the nearest $100 give or
take another $100. This task is
difficult for her since, as a surgical
nurse by training long before computers,
she did not even use a calculator let
alone a computer. She still likes to
balance our checkbook without the aid of
a calculator.
How to Manage Your Finances When One Spouse Retires – and the Other
Doesn’t ---
http://money.usnews.com/money/retirement/articles/2017-04-28/how-to-manage-your-finances-when-one-spouse-retires-and-the-othe
Time Magazine: A Majority of
People Are Making This Costly Medicare
Part B Mistake ---
Click Here
Jensen Comment
They may also be making a mistake
regarding how much to pay for a Medicare
supplemental plan that can get quite
expensive. My wife has had numerous
surgeries, hospital stays, therapy
hospital stays, medication
prescriptions, and therapist home
visits. We have saved tens of thousands
of dollars by having her on the best
Medicare supplemental plan available
from Blue Cross Anthem. For me having
such a premium plan costs me far more
than the benefits claimed to date. There
are various other supplemental plans to
choose from and it's difficult to
recommend a given level of plan without
factoring in health and income.
Carefully read about coverage and costs.
A growing number of Americans over
age 65 are filing for bankruptcy just to
get by, and it could signal a larger
problem in the US ---
https://www.businessinsider.com/older-americans-are-filing-for-bankruptcy-during-retirement-2018-8
Jensen Comment
One of the main problems is that workers
factored in Social Security benefits as
part of their monthly income after
retirement. What they failed to account
for is that Medicare, Medicare D, and
Medicare supplemental insurance leaves
almost nothing out of SS benefits for
other living expenses. Although SS
benefits are taxable, most poorer
recipients probably pay little or no
income taxes since nearly half of the
people who file tax returns do not owe
any income taxes. The killer is the cost
of the Medicare and supplemental
Medicare benefits. One option is to
declare bankruptcy and go on Medicaid,
But declaring bankruptcy has its own
drawbacks including the possible loss of
a home. Some folks intend to be helped
by their children, but all too often
their children aren't reliable in this
regard. Their needs for financial help
may be part of the problem.
The cost of long-term care insurance
recently doubled (almost), because the
cost of long-term care almost doubled
over the past decade. Costs vary greatly
with quality of care --- there are a lot
of expensive, albeit crappy, nursing
homes. I never thought long-term care
insurance was a good deal before it
doubled since I planned ahead with
tax-free savings for possible long-term
health care. It's not possible to advise
anybody about long-term care insurance
without knowing more details about the
person being insured, and then it's
usually an expensive crap shoot. Be sure
to read the fine print before signing
any long-term care insurance policy.
Four types of
retirement plans for small businesses:
SEP, Simple IRA, 401(k), and Solo 401(k)
---
http://maaw.blogspot.com/2018/12/four-types-of-retirement-plans-for.html
How to mislead with statistics
A new NBER paper finds an increase in male mortality immediately after
retiring at age 62 ---
http://www.thinkadvisor.com/2018/01/02/early-retirement-aligns-with-early-death-study-fin?&slreturn=1515496097
Thanks to Glen Gray for the heads up.
Jensen Comment
Although the report is pretty good about
noting the limitations of its findings
it's important to note that electing to
start Social Security at age 62 is not a
random event. People in their early 60s
do not flip coins to decide whether or
not to take early SS payments at age 62.
Many have medical issues, some life
threatening, that increase the odds of
choosing early payments. Also most
individuals have some knowledge of their
own life expectancy. Firstly, they know
their prior medical history such as
already having had cancer or two heart
attacks. Secondly, they know something
about their genetic history such as
having ancestors that live to ripe old
ages.
Secondly, for many taking early
retirement does not mean quitting work.
Some simply change jobs, but others stay
of the same job. Note that benefits may
be reduced by starting SS payments at
age 62.
My
main point here is that this is an
illustration of where statistical
findings should probably not have a
major impact on individual choices
because the statistical findings are
misleading for particular instances ---
like the particular instance of your SS
timing decision.
At what age should you start your Social
Security benefits?
https://www.schwab.com/resource-center/insights/content/when-should-you-take-social-security?cmp=em-QYC
Jensen Comment
For those contemplating starting up
Social Security benefits before age 65,
keep in mind that Medicare is not
available until age 65 except for people
who qualify for Medicare under approved
disability benefits. Note that it's
possible to start SS benefits under
disability at most any age. Those
benefits may or may not carry Medicare
benefits. My wife got SS disability
benefits and Medicare benefits well
before she was 60 years of age (she's
had 17 spine surgeries). One of our
daughters got SS disability benefits
without Medicare benefits when she was
much younger. Her husband, however, had
family medical insurance through his
university faculty employer.
If you are legitimately disabled you
should probably apply for SS disability
payments whenever you are unable to work
and your other disability coverage is
about to expire. It's best, in my
opinion, to talk to specialized lawyers
who will carry the ball on your SS
disability. application. Getting
approval may take years.
Home Equity Loan ---
https://en.wikipedia.org/wiki/Home_equity_loan
The New Tax Law: How Home Equity Loans Have Become
a Worse Deal for Homeowners ---
http://247wallst.com/housing/2018/02/02/how-home-equity-loans-have-become-a-worse-deal-for-homeowners/?utm_source=247WallStDailyNewsletter&utm_medium=email&utm_content=FEB032018A&utm_campaign=DailyNewsletter
Jensen Comment
In general I've preferred home equity lines of credit to reverse mortgages, but
there are circumstances that might favor reverse mortgages.
Reverse Mortgage ---
https://en.wikipedia.org/wiki/Reverse_mortgage
Is a Reverse
Mortgage Right for You or Your Parents
---
https://www.newretirement.com/retirement/new-reverse-mortgage-calculator-assesses-suitability/?nr_product=revmort&nr_a=OB&nr_adgroup=seniormanbig&nr_medium=contentmkt&nr_creative=b4isgnoffRMrd&nr_campaign=acssuit4retire&nr_adtype=ImageOverHeadLine&nr_keyword=lookalikev2&utm_medium=contentmkt&utm_source=OB&nr_size=00bdb2eef6ffc34429fb93fe43f8b6ad06&nr_placement=Life
Bob Jensen's personal finance helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Chicago Tribune: The average 65-year-old couple retiring in a year
can expect to spend $404,253 in today's dollars on health insurance and other
health care costs ---
http://www.chicagotribune.com/business/columnists/ct-retirement-health-care-costs-marksjarvis-column-0618-biz-20170615-column.html
Jensen Comment
Erika and I spent more than $400,000 on
health care in the first 10 years of
retirement. Firstly, Medicare is not
free in retirement even though we both
paid into Medicare during our working
years ---
https://en.wikipedia.org/wiki/Medicare_(United_States)#Out-of-pocket_costs
Secondly, the premiums for our
Medicare Supplemental insurance can be
much greater than the Medicare premiums.
I recommend buy a quality supplemental
Thirdly Medicare D only pays a
portion of our annual prescription drug
costs, especially after Erika and I hit
the donut hole every year ---
https://en.wikipedia.org/wiki/Medicare_Part_D_coverage_gap
Fourthly, there are many medical
expenses not covered by Medicare,
including all the non-prescription
medications and such things as my hotel
expenses in Boston when I wanted to be
near Erika during her surgeries and
therapy sessions.
Don't think that I'm complaining
since Medicare has paid out over a
million dollars for Erika's multiple
spine surgeries and therapies and
medications. My
point, however, is that retirees should
not really count on much on
discretionary spending from Social
Security payments since there are ever
so many medical expenses for many
seniors on Social Security.
And most importantly, Medicare does
not pay for nursing services (such as
the enormous monthly costs of nursing
homes) when folks are no longer able to
care for themselves. Erika and I are not
at that point, but all people should
plan ahead to save for the time when
they might need very expensive long-term
nursing care. I'm not an advocate of
expensive nursing care insurance, but
everybody should consider this and other
alternatives in planning ahead for the
possibility of needing long-term nursing
care.
How little couples talk about money.
It’s probably one of the last taboos
except in heated arguments after it's
too late.
Suggestions for improving
communications with partners about money
http://www.forbes.com/sites/johnwasik/2016/09/16/how-much-do-you-need-for-retirement-communication-is-the-key/#558a3fc514eb
Jensen Comment
I found the best way to communicate
about money with Erika was to let her
take over the checkbook years and years
ago even before we retired. That way
when I talked about long-range planning
her knowledge of the short-range ins and
outs made her much more sympathetic and
understanding about the long run. In the
short run, however, she still won't tell
me how much money is in the account ---
in fear that I might spend too much
foolishly if I know how much is
available. She let's me carry one check
in my billfold --- but that's strictly
for emergencies.
And what a relief it was to put bill
paying out of my mind.
Erika actually reconciles the checkbook
to the penny which is something that I
rounded off to the nearest $100 give or
take another $100. This task is
difficult for her since, as a surgical
nurse by training long before computers,
she does not even use a calculator let
alone a computer. She was very good at
counting sponges and sometimes had to
tell the surgeon that a sponge was
unaccounted for and must still be hidden
in the body. One time a surgeon ignored
her. Three weeks later he had to go back
into the patient's body to look for the
(now infected) sponge.
Most Seniors Flunked a New Retirement
Quiz. Could You Do Better? ---
http://time.com/money/4771461/retirement-quiz-pass-or-flunk/?xid=newsletter-brief
Six Ways to Fraud-Protect Savings of the Elderly (note the "springing"
power of attorney)---
http://www.cbsnews.com/news/6-ways-to-fraud-proof-your-retirement-savings/
Jensen Comment
Some of these tips should be modified in
light of protections such as the degree
of protection provided by a trustworthy
ID theft insurance protection company.
Definitely consider the deep pockets of
your account provider. Many thefts are
less protected if you use a local money
manager (like a solo attorney or CPA)
rather than a reputable money management
company.
If you have a broker make sure that
broker is not churning the accounts for
increased transactions commissions.
Older folks may not really need to pay
money managers if they park their
savings in safe places like TIAA,
Vanguard, or Fidelity offering free
high-quality advice to older folks.
Before retirement many employers provide
some good free advice for money
management.
Some things vital to younger people
are not as relevant to older folks. For
example, when investing pension savings
a younger worker should definitely
consider inflation risks. Inflation risk
of of less concern to most older folks
when it comes to weighing investment
risk against inflation risk. For
example, investing savings in a
tax-exempt bond mutual fund is not a
good alternative for long-term inflation
protection, but may be a good place to
park money for older folks like me less
concerned with inflation risk. A
high-priced house on an acreage may be
good inflation protection for a young
couple but retirees might consider
selling it off after retirement so they
can appreciate the liquidity without
having to incur the financing cost of a
reverse mortgage. In my opinion, reverse
mortgages are over-hyped in the media.
For sme older folks they are not the
best alternative for liquidity.
Everybody should keep an eye on tax
reform.
I doubt that Trump will be able to
eliminate all the itemized deductions he
recently proposed eliminating, but some
older folks should reconsider both
investing and spending practices if he
has some success. Personally, I don't
think Congress will greatly modify tax
law for individuals, although there may
be some major revisions for business
firms. Older folks affected by the more
complicated aspects of tax regulations,
such as those having Subchapter S
investments, definitely should seek out
expert advice unless they are experts
themselves. Don't be blind sided by
serious tax reform!
Bob Jensen's personal finance helpers
are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
20 Rules of
Personal Finance ---
http://awealthofcommonsense.com/2016/12/20-rules-of-personal-finance/
rom the Scout Report on May 5,
Google
Keep ---
https://keep.google.com
Gmail users
may be interested in Google Keep, a
tool that allows users to save
reminders, to-do lists, URLs,
images, and more in just one place.
Once downloaded, users can quickly
and easily create reminders, upload
images, or add notes. While Google
Keep is folder-free (which may
appeal to those looker for
simplicity), users do have the
option of adding labels,
color-coding items, and conducting
a text search for a note or item of
interest. Google Keep also syncs
across multiple devices and users
have the option of copying and
exporting text from Google Keep into
Google Docs for editing. Just like
Google Docs, Google Keep also allows
users to easily share notes and
items with others.
DashFlow
Money Tracker --- http://dashflow.co
Looking for
some digital help in tracking your
spending habits and meeting
financial goals? Dashflow may
appeal. This financial application
for iOS devices allows users to
organize and track spending.
Financial information is presented
across a number of useful graphs and
the user-friendly and
straight-forward interface allows
users to focus on their financial
life without distraction. In
addition, DashFlow allows users to
enter due date reminders and track
multiple financial goals at once.
The basic version of DashFlow is
free; users have the option of
purchasing Pro or Premium versions
for additional features
From the CPA Newsletter on November 19,
2015
US ranks 14th in
world for financial literacy
http://www.forbes.com/forbes/welcome/
The
US ranked 14th in a survey of global
financial literacy that was
conducted in more than 140
countries. The researchers asked
multiple-choice questions about
topics such as interest and
diversification. Only 57% of
Americans received a passing grade.
Find the AICPA's financial education
resources at
360financialliteracy.org.
Forbes
(11/18)
Still, there’s little to celebrate from
Bankrate’s survey of banks. To make sure you’re not hit with egregious ATM
fees, here are three simple ways to avoid them
---
http://time.com/money/3433402/how-to-avoid-atm-fees/
Finance Tips from
The Math Dude Blog ---
http://www.quickanddirtytips.com/
These my be especially interesting when
teaching financial literacy modules
is a credit card
APR and how is it
calculated?" A. APR
is short for Annual Percentage Rate,
... which is the interest you’re
charged over a 12-month period. For
instance, a card with 24%
APR costs 2% ... a
single account can have several
different
APRs. The card
company may charge one rate for
purchases, one ...
By Laura Adams, MBA,
Money Girl
- December 18, 2013
a higher rate of interest.
Understand APY vs.
APR Speaking of
interest, there are two main ways
that ... interest is expressed for
CDs: APY and
APR. APY stands for
annual percentage yield and it’s the
rate you’d ... APY is the rate
you’ll get if you never withdraw
interest from a CD.
APR, on the other
hand, stands ...
By Laura Adams, MBA,
Money Girl
- February 10, 2011
Jensen Comment
CD's have very lousy investment
returns since the Federal Reserve
drove interest rates to almost zero.
In general these days you have to
take on more risk to get better
returns.
transfer card with 0%
APR for 12 months,
no annual fee, no balance transfer
fees, plus cash back rewards. ...
APR after the 0%
APR 12-month
promotion period expires. If she
continues to make $500 monthly ...
By Laura Adams, MBA,
Money Girl
- January 08, 2012
a lower interest rate, you can save
a lot of money. The Discover® More
Card gives you 0%
APR for 15 months
... Lending Club or Prosper —where
you can borrow for as little as
6.59% and earn an average of 10.59%
APR ...
By Laura Adams, MBA,
Money Girl
- June 02, 2012
typically charged a daily rate
that's equal to the card's annual
percentage rate (APR)
divided by ... 365. For instance,
the
APR for new
purchases could be 11.99%, cash
advances 23.99%, and balance ...
By Laura Adams, MBA,
Money Girl
- December 01, 2011
Jensen Comment
Make every effort to pay more each
month than what the credit card
billing says is the "minimum"
amount.
Better yet always take the monthly
amount due down to zero to avoid
interest charges altogether.
6.
card debt of $6,000. The
APR (annual
percentage rate) on my card is high
at 17% and I'd love to ...
By Laura Adams, MBA,
Money Girl
- December 21, 2010
8.
Otherwise, after the promotion ends,
the annual interest rate or
APR usually
skyrockets on your outstanding ...
By Laura Adams, MBA,
Money Girl
- September 26, 2013
transfer at 0%
APR for a limited
time. Should I transfer the balance
of my higher-interest card and save
... a balance transfer card, look
for the following features: an
introductory interest rate of 0%
APR for ...
By Laura Adams, MBA,
Money Girl
- December 18, 2012
The Khan Academy also has some
great personal finance tutorials ---
https://www.khanacademy.org/economics-finance-domain/core-finance/investment-vehicles-tutorial
Bob Jensen's threads on personal
finance ---
http://faculty.trinity.edu/rjensen/bookbob1.htm#InvestmentHelpers
Helpers for Student Loan
Forgiveness and Cancellation ---
https://www.moneygeek.com/education/college/resources/student-loan-forgiveness-cancellation/
Jensen Comment
If you do not qualify for student loan
forgiveness you should probably compare
your current annual loan payments with
payments if you privately refinance at
the present low interest rates. However,
you may lose some protections and
options in doing so. Be careful about
refinancing that sounds too good to be
true. You might be able to refinance
with your parents in a win-win situation
if your parents consider you a good
investment risk and you pay a higher
interest rate than their safe investment
alternatives. Read that as meaning you
have a good job in a good profession and
are not an unemployed aspiring artist or
writer or getting a Ph.D. in a
discipline where Ph.D. graduates are a
dime a dozen.
Whether or not you pay your student
loan off aggressively by making above
the minimum amounts due each year
depends much upon what you would
otherwise do with the money. Savings
rates are so low that you are probably
better off paying the loan off
aggressively relative to saving. Risky
investments are not the same as
gambling, but you should probably be
very cautious with putting money into
risky investments like tech stocks until
you have your student loans paid off.
Also remember that there are
transactions costs for buying and
selling land, houses, and stocks.
Short-term ownership (called flipping)
of a house/condo is risky unless the
buying deal was very good in a very hot
housing market such as near a college or
medical center. It helps in house
flipping markets if you do the fixing up
of a house yourself.
My advice is to avoid buying new cars
until your loan is paid off, although
you may have to invest in a quality
pre-owned car or lease modest cars at
low rates. Think public transportation
if you live in an urban area that has
good public transportation. You can
always rent an occasional car if needed
for a trip.
"Why Land and Homes Actually Tend
to Be Disappointing Investments," by
Robert J. Schiller, The New York
Times, July 15, 2016 ---
http://www.nytimes.com/2016/07/17/upshot/why-land-may-not-be-the-smartest-place-to-put-your-nest-egg.html?_r=1
Jensen Comment
This article is yet another example of
how to mislead with statistics. Making
money in land parcels and homes is
exactly like making money in the stock
market --- you've got to have picked the
right ones to put into your portfolio. I
sold an Iowa farm that more than doubled
in value after I sold it. One reason was
the idiotic decision to subsidize corn
farmers by requiring upwards of 10% corn
ethanol in every gallon of gas. North
Dakota farmers made a lot of money
selling oil rights. Owners of condos in
Manhattan and San Francisco made small
fortunes on tiny bits of property.
Houses purchased for less than $50,000
in 1980 in Silicon Valley may be worth
more than $5 million in 2016.
But what looks like good deals in
stocks and real estate in hindsight is
just that --- hindsight! There are no
guarantees of high returns without
taking risks unless you are in the Mafia
where you can force your own returns.
Expectations of higher returns means
acquiring more financial risk for most
of us.
There are some serious advantages to
investing as much as you can in a home
when you anticipate owning it for more
than 10 years. Firstly, you get the
added non-financial enjoyment of living
in a wonderful home. Secondly, there are
some tax breaks for the the 50% of
taxpayers that really pay taxes. But
there are a drawbacks. Property taxes
are the primary way the USA funds its
K-12 schools as well as pay for county
and municipal services. In most
instances growth rates for property
taxes outpaced the capital gains since
the real estate bubble burst in 2007.
There are also some wonderful
instances where owners have successful
rental properties such as owning a
duplex where the rent from one half of
the house pays all the expenses of the
entire house. A friend of mine, Tom
Selling, says that when he moved from
Dartmouth it was a good decision to
continue to rent his condo rather than
sell it at the time. That is probably
true of nearly all rental property close
to college campuses if the property was
purchased before the real estate bubble
burst in 2007. There are some tax breaks
of rental housing such as depreciation
and maintenance expense write-offs. For
example, half the cost of the roof on a
duplex might be expensed.
Don't get carried away investing in
land that has no serious annual cash
inflow. Of course there are exceptions,
but in general the taxes and maintenance
fees (e.g., mowing) plus the eventual
cost of selling the land take all the
fun out of trying to eventually make a
profit.
With bank savings deposits earning
virtually zero interest it's tempting to
take on more financial risks with your
savings. Each investor is unique. I
advise getting "free" advice from
reputable mutual funds like Vanguard or
Fidelity or TIAA. I don't advise paying
dearly for it at your local investment
advisor service. Find out the range of
alternatives from long-term tax exempt
mutual funds to diversified real estate
fund to a varity of long-term and short
term equity alternatives. Learn enough
to become your own adviser.
Bob Jensen's helpers for investors
(free because that may be more than
they're worth) ---
See Below
Home Equity Loan ---
https://en.wikipedia.org/wiki/Home_equity_loan
From the
CFO Journal's Morning Ledger on August 12, 2016
Home equity loans come back to haunt
borrowers, banks
The bill is coming due for many
homeowners on a type of loan that
was widely popular in the run-up to
the housing bust, causing a rise in
delinquencies at banks. More
homeowners are missing payments on
their home-equity lines of credit,
or Helocs, a type of loan that
allows borrowers to withdraw cash
from their house to pay for
renovations, college tuition or
almost any other expense. These
loans typically require
interest-only payments for the first
10 years, but then principal
payments kick in for the next 15 or
20 years. Borrowers who signed up
for Helocs in early 2006 were at
least 30 days late on $2.8 billion
of balances four months after
principal payments kicked in this
year, according to
Equifax Roughly 840,000 Helocs
taken out in 2006 are resetting this
year, with principal payments on an
additional nearly one million loans
expected to hit in 2017.
Alliance for Financial Inclusion
(financial literacy initiative funded by
Bill and Melinda Gates) ---
http://www.afi-global.org/
Tips on Personal Finance ---
http://twitter.com/EverydayFinance
Helpers in planning for retirement ---
http://www.plan-for-retirement.com/
Personal Financial Helpers:
From the Virginia Society of CPAs ---
http://www.vscpa.com/Financial_Fitness/
Wharton Professor Olivia Mitchell on
Worldwide Financial Literacy
http://www.ssga.com/definedcontribution/docs/Olivia_Mitchell_GlobalFinancialLiteracy_SSgADC_The
Participant02.pdf
Thank you Jim Mahar for the heads up.
Education: Federal Reserve Bank of
Kansas City ---
http://www.kansascityfed.org/education/
Note the Financial Fables section ---
http://www.kansascityfed.org/education/fables/index.cfm
A Guide to College Savings Plans ---
http://www.moneygeek.com/education/college/resources/college-savings-plans-guide/
Bob Jensen's helpers in personal finance
---
http://faculty.trinity.edu/rjensen/bookbob1.htm#InvestmentHelpers
Video: Investing for Inflation ---
http://www.simoleonsense.com/janet-tavakoli-author-of-dear-mr-buffett-on-investing-for-inflation/
What five classic Disney movies can
teach us about personal finance ---
http://www.csmonitor.com/Business/Saving-Money/2014/0904/What-five-classic-Disney-movies-can-teach-us-about-personal-finance
U.S. Social Security Retirement
Benefit Calculators ---
http://www.socialsecurity.gov/estimator/
Mutual Funds: 10 questions to test your
IQ (ten answers every investor should
know by heart) ---
http://www.azcentral.com/business/consumer/articles/2009/04/10/20090410biz-MutualFundsQuiz0410.html
The London Stock Exchange, one of the
UK’s top financial institutions – has
recently revamped its website (
www.londonstockexchange.com )
to expand its user-base. A wealth of
useful financial information can be
accessed on the new site, such as live
share and stock prices, charts, indexes
including FTSE 100 index, listed
companies and financial news. As well as
the global financial shares and trading
markets, users can also keep up to date
with the UK stock market by taking
advantage of the many new additions to
the website.
"Lack
of Financial Literacy Complicates
Student-Aid Process, Report Says,"
by Allie Bidwell, Chronicle of Higher
Education, May 13, 2013 ---
http://chronicle.com/article/Lack-of-Financial-Literacy/139223/
Bob Jensen's advocacy of putting
financial literacy in the common core
---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#FinancialLiteracy
The Washington Post's New Personal
Finance Service ---
http://www.washingtonpost.com/business/get-there/
This Sneaky Retailer Trick Could
Cost You Hundreds of Dollars ---
http://time.com/money/4578471/retailers-deferred-interest-deals/?xid=newsletter-brief
Social Security Administration ---
https://www.ssa.gov/
This site has a reasonably good search
engine
"Here's when you should start
claiming your Social Security benefits,"
by Ben Carlson, Business Insider,
May 2016 ---
http://www.businessinsider.com/when-to-claim-social-security-benefits-2016-5
. . .
What if you’re still
working?
What age gives you
the highest benefits?
What happens in a
widow(er) situation?
What’s the breakeven
if you wait to claim?
What about divorced
spousal benefits?
How does social security affect tax
planning
Continued in artilce
Retirement Planner: Benefits For Your Divorced Spouse ---
https://www.ssa.gov/planners/retire/yourdivspouse.html
Here’s What You’ll Pay for Health Care In
Retirement (Social Security benefits won't even cover your health care costs
if you add supplemental Medicare insurance (that I recommend by the way)) ---
http://time.com/money/4340299/what-youll-pay-healthcare-in-retirement/
Forget about retiring
on Social Security. Health care costs alone will devour the entire lifetime
benefits—and then some—of a 45-year-old couple when they retire, according
to projections released Wednesday by HealthView Services, a Danvers, Mass.-
based company that provides retirement health care cost data and tools to
financial advisers.
Social Security
payments will stretch farther for current retirees, but the numbers are
still stark: In 2016, the average 66-year-old couple will require 57% of
their lifetime, pre-tax Social Security benefits to pay for health care
costs, according to HealthView Services. The average 45-year-old couple, by
contrast, will need 116% of lifetime Social Security payments to cover
health care costs.
Total retirement health care expenses for that 45-year-old couple planning
to retire at age 65 will come to $592,275 in today’s dollars and $1.6
million in future dollars, HealthView Services projects. The projection
assumes the male member of the couple will live to 87 and the female to 89.
The total tab includes premiums for Medicare Part B, which covers doctors’
visits, Part D, which covers drugs, and Part F, which is the most
comprehensive supplemental insurance. It also includes expenses not covered
by Medicare, such as dental work and hearing aids. Notably, it does not
include long-term care costs. Medicare does not pay for long-term stays in
nursing homes, or for assisted living facilities.
Of course, these averages won’t reflect everyone’s experience. People’s
individual health status will influence how much they pay. What’s more, not
everyone will choose to buy a Part F Medigap policy. It’s a popular but
expensive choice, with monthly premiums that vary widely by region but
average around $200.
While expensive, Part F plans eliminate a lot of the uncertainty of medical
expenses. Premiums are predictable and cover most of beneficiaries’
out-of-pocket expenses. Without a supplemental plan, beneficiaries could be
on the hook for even more if they have a big medical episode, such as a
stroke, or a serious diagnosis like cancer.
On Plan F, “if you never have a problem and drop dead at 110, you’ll have
wasted a lot of money,” said Ron Mastrogiovanni, founder and CEO of
HealthView Services. A more likely scenario, he said, is that, “We’re not
going to stay healthy throughout retirement.”
Continued in article
Bob Jensen's personal finance helpers ---
http://faculty.trinity.edu/rjensen/bookbob1.htm#InvestmentHelpers
Bob Jensen's universal health care messaging ---
http://faculty.trinity.edu/rjensen/Health.htm
If you
are daydreaming about the differences
between men and women don't forget this
important difference.
In July
I had occasion to visit a friend in our
local nursing home in Franconia. I had
to pass by a large number of residents
on the porch before reaching the front
door. I counted 18 old women and 2 old
men. Why weren't the gender odds like
this the same when I was a student on
campus?
From the
CPA Newsletter on December 4, 2015
Women face higher long-term care
costs
Women are more likely to need
long-term personal care as they age,
research shows. In addition, women
often need this type of care for
longer periods than men do, partly
because they tend to live longer.
Total projected spending on
long-term care exceeds $182,000 for
women over 65, half of which will be
out of pocket.
Forbes
(12/3)
Jensen
Comment
Remember that Medicare does not fund
nursing home confinement, and the costs
of such confinements are exploding in
part due to demand increases from the
aging baby boomer generation. Yikes
that's me!
Medical Costs Can Add Up in Retirement
Two Big Reasons You Need Added Savings in Retirement ---
http://www.forbes.com/sites/ashleaebeling/2015/09/25/two-big-reasons-you-need-more-retirement-savings/
Think Medicare will cover you when
it comes to all your health-related
expenses in retirement? Not even
close. Sure Medicare is the
cornerstone of coverage, but it
covers approximately 60% of health
care expenses, and it does not cover
long-term care expenses. That leaves
retirees with major health care
expenses (medical, dental, vision,
prescription) and possibly long-term
care expenses (home health care
services or assisted living or
nursing care) coming out of their
retirement nest egg.
Pre-retirees should take a
two-pronged approach to planning for
these health-related expenses in
retirement and make health care part
of their overall retirement plan,
says Carol Goetsch, manager of
advisory client services at U.S.
Bancorp Investments in Minneapolis.
“Having a plan allows you to
determine where and how you want
coverage and the role your family
members will play; not having a plan
becomes reactionary and creates
dysfunction in the family.” Goestch
says.
Here’s the overwhelming big picture.
A couple at age 65 can expect to
spend $395,000 in medical, dental,
vision, hearing, premiums, co-pays
and other out of pocket health care
expenses in retirement–according to
Healthview Services 2015 Retirement
Health Care Cost Data Report.
Long-term care expenses are
separate, and will cost an average
of $140,000 per person, although the
averages can be misleading, meaning
you might need a lot more,
especially if you’re a woman.
Here are some planning tips.
Don’t count on
health care cost averages. A
Midwestern couple came to Goetsch
when they were turning 60. They
thought they could live off of
$75,000 a year until their Bancorp
advisor helped them run a health
assessment that estimated their
combined health care expenses would
be $3,500 a month or $42,000 a year
(one is a diabetic and one has heart
issues). On average an individual
needs $1,000 a month to cover basic
medical expenses in retirement, but
one mistake people make is looking
at averages instead of what their
circumstances project. “Certain
impairments take more of a toll,”
Goestch says. Gender, family
history, and current life expectancy
should all be taken into account. In
this case, the couple decided to
work a little longer and take
advantage of workplace benefits–at
least until they reached 65 and
could go on Medicare. They cut back
on lavish travel and supercharged
retirement–and health care–savings.
Continued in article
Four Mistakes That Could Ruin Your
Retirement ---
http://www.cnbc.com/2015/09/03/4-mistakes-that-could-ruin-your-retirement.htm
Mistake: Boosting
bond allocations at retirement
It used to be a good ideal to shift
from CREF to TIAA before retirement.
Thanks to the Fed's virtually zero
interest rate policies this may no
longer be a good idea. Times change,
however, so everything should be
reconsidered if you won't be
retiring soon.
Mistake: Counting on Medicare to
cover all health care costs
Medicare is being torn apart by
fraud and explosion of medical
costs. Drastic revisions in the
future almost certainly will entail
making middle and upper income
retirees bear much more of their
medical costs than they currently
are paying out when on Medicare.
Mistake: Moving to a state for the
low income taxes
There are usually more important
variables for choosing where to live
in retirement than state income
taxes. However, if plans include
moving to another state both income
and inheritance taxes should be
considered. We have two grown
children living in California and
Maine. Taxes were a consideration
when we chose New Hampshire with
good tax deals relative to Maine and
California, and New Hampshire is
very close to Maine.
Mistake: Not saving
enough for retirement.
This is a bigger problem since the
Fed's zero interest rate policy
destroyed most safe investment
alternatives like certificates of
deposit and low-risk bonds. Now
investments for retirement must take
on more risk like choosing all CREF
versus having some TIAA. Of course
taking on more financial risk
entails taking more chances. Dah!
Some investors take chances in real
estate, but the real estate in my
portfolio was only in the house I
lived in and the land surrounding
this house. I do not generally like
rental property because of the
headaches of being a landlord
(including owning a farm). I do not
like idle land investments because
of the annual property taxes and
insurance cash going out and no cash
coming in.
More of Bob
Jensen's personal finance helpers
---
http://faculty.trinity.edu/rjensen/bookbob1.htm#InvestmentHelpers
This is the research you should do before picking a credit card ---
http://www.businessinsider.com/sc/pick-the-right-credit-card-2015-8
AICPA: Back-to-School: How to Pay for College
---
http://blog.aicpa.org/2015/08/back-to-school-how-to-pay-for-college.html#sthash.gcYpuxSm.PSkI9cqt.dpbs
The Upshot: Is It Better to Rent or Buy? (real estate calculator) ---
http://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html
Jensen Comment
My general advice for new faculty is not to buy a home until tenure is achieved
except in hot markets where fast turnover profits are probable provided too much
is paid initially. After tenure achievement the above calculator can be helpful.
My priors were to invest as much as possible in long-term ownership of a
house and the least possible in the long-term ownership of a very reliable car.
However, be careful where you buy real estate. Up in the White Mountains I
advise mountain or lake views even though New Hampshire has a view tax.
There really aren't any gated neighborhoods up here, and nothing would be gained
by having gated neighborhoods. In San Antonio I would not put big money into a
house that's not in a gated neighborhood. Even if you're opposed philosophically
to that concept, the fact is that expensive homes do not sell very well in San
Antonio unless they are in gated neighborhoods with armed guards at the gates. I
would have had much more capital gain on my big San Antonio house if it had been
in a gated neighborhood. Sigh!
The Upshot: Is It better to Lease or Buy a Car? ---
http://money.howstuffworks.com/business/getting-a-job/buy-vs-lease-car.htm
Jensen Comment
Leasing became much more attractive when the Federal Reserve drove commercial
interest rates toward zero. But that does not mean "more attractive" than buying
in all instances. Much depends on the amount you drive and the terms of the
lease in the context of the amount you drive. It also depends a lot upon
your willingness to drive older cars. When I worked in San Antonio where newish
cars are stolen in unbelievable numbers daily my wife's car was a newish tiny
Honda Civic, and I drove a very reliable battered up ancient Ford station wagon
that had a newish engine and transmission under the hood. This ghetto-like car
looked so bad that nobody would think of stealing it and driving it across the
border to Mexico.
In general, even in retirement, my wife and I do not mind driving
well-maintained older cars. Our main car in the White Mountains (where car theft
would be headline news) is a very reliable Subaru Forrester that we will
probably drive until it is at least 20 years old (it's now five years old) or
has over 100,000 miles. The Subaru will probably be the last car we ever
own. After that its car leasing for us unless we're in a nursing home. I also
keep an unreliable old Jeep Cherokee in the barn that's used mostly for hauling
brush to the dump. That will be in our barn on the day I die.
My point is that leasing would probably not be the best choice for us until
we're very old. However, leasing is the best choice for most of our children
except for one son who puts a lot of miles on a car commuting a long distance to
work in California.
How to Mislead With Statistics
"How much you have to save every year if you want to put your kids through
college," by Libby Kane, Business Insider, April 27, 2015 ---
http://www.businessinsider.com/how-much-to-save-every-year-for-college-2015-4
Customized cost and savings calculators.
Jensen Comment
I've repeated elsewhere over and over
that there are many factors that make
the cost of college education variable
and uncertain. For example, the cost of
getting an online degree (even from a
high quality university) while living at
home is a whole lot different than
paying full tuition, room, and board for
an onsite degree at either a public or
private university or college.
Also financial aid is common and very
serious for a majority of students. The
tuition cost is now
zero in
many USA prestigious (e.g., Ivy League)
universities for students from families
earning less than $125,000 per year. In
addition, President Obama is now
forgiving all or parts of student loans
for a relatively small number of
graduates.
The problem when the kids are very young
lies in choosing a college savings plan
without knowing what lies ahead in terms
of future tuition costs, living costs,
financial aid, etc. Colleges may be
funded quite differently 20 years from
now, and we really don't know what kind
of deals will be available way out in
the future. For example, it's entirely
possible that the most prestigious
universities in the USA will be totally
free to all students, albeit a highly
restricted number of students qualifying
for admissions. It's entirely possible
that the first two years of college will
eventually be free in most
state-supported universities.
Parents and especially grandparents
currently contribute a great deal of
financial support from tax-advantages
529 Plans ---
http://en.wikipedia.org/wiki/Coverdell_Education_Savings_Account
Who knows if and how long those plans
will survive?
These plans are currently clobbered by
the Fed's "quantitative easing" (QE)
interest rates that through savers under
the bus by paying virtually negligible
interest rates.
A Guide to College Savings Plans ---
http://www.moneygeek.com/education/college/resources/college-savings-plans-guide/
This Is the Worst Retirement
Solution Ever ---
http://www.bloomberg.com/news/articles/2015-04-21/this-is-the-worst-retirement-solution-ever?cmpid=BBD042115
Tips for Passing a Personal-Finance
Stress Test ---
http://blogs.wsj.com/briefly/2015/03/11/5-tips-for-passing-a-personal-finance-stress-test/
Your household finances might be
humming along just fine. But would
they be able to withstand an
unforeseen medical bill or sudden
reduction in paid working hours? How
about a job loss, furlough or
unexpected tax assessment? As the
Federal Reserve prepares to announce
the results of this year’s stress
tests on the nation’s largest banks
Wednesday, we offer the following
five stress tests for your own
finances.
1 Debt-to-Income Ratio
Divide your debts, including credit
cards, student-loan and car-loan
balances, and your mortgage, by your
pretax earnings. That will give you
your debt-to-income ratio.
Sheryl Garrett, the founder of the
Garrett Planning Network, says a
good rule of thumb is to have a
personal debt-to-income ratio of
less than 28%, not counting
mortgages, or household
debt-to-household income of less
than 36%, including mortgages.
A higher ratio is a warning that you
have too much debt relative to your
income and you either have to lower
your debt or raise your income, or
both.
2 Discretionary Expenses
It’s important to know what your
discretionary expenses are and how
quickly you can cut back on them in
times of stress.
Start by sorting all your expenses
into three categories: fixed, which
are those payments you have to make
regardless of circumstances;
variable nondiscretionary, which are
expenses such as groceries or
air-conditioning bills over which
you can exercise some level of
control; and purely discretionary
expenses such as gym memberships and
vacations.
Discretionary expenses should make
up a greater percentage of your
overall expenses than your fixed
expenses, says Eleanor Blayney,
consumer advocate for the CFP Board
in Washington, giving you room to
defer, cut back or eliminate.
“Figure out what you could live
without or whittle down quickly,”
she says. Discretionary Expenses >
Fixed Expenses
A good standard is for discretionary
expenses to be two thirds of your
overall expenses.
3 Emergency Savings
Financial planners tell clients to
reserve enough cash in savings or
other easily liquidated accounts to
cover three to nine months of
expenses—with three months being the
bare minimum.
This stash will be the first place
you turn for help because it is
readily available. Getting at it
shouldn’t require selling securities
or taking an early-withdrawal
penalty from a retirement account or
certificate of deposit.
The greater your obligations, the
more emergency cash you should have
squirreled away, planners say. A
single mother with a mortgage would
want several months if not more than
a year of cash to cover expenses,
for example. A freshly graduated
single person who has no student
debt and who is renting an apartment
might need only three months’ worth.
The National Foundation for Credit
Counseling offers a program called
“Sharpen Your Financial Focus” that
has free online questionnaires for
people to use in figuring out their
own plans. 3 to 9 You should have
enough cash to cover three to nine
months of expenses in case of
emergency.
4 Additional Income
Consider your options for generating
additional income in a period of
stress, says Bruce McClary, a
spokesman for the National
Foundation for Credit Counseling.
Wages or tips from a second
part-time job or proceeds from
selling personal possessions could
raise enough to float you through a
financially strapped period without
spending down your emergency savings
too quickly.
5 Total Assets
If banks are evaluated by the
liquidity and quality of their
balance sheets and their ability to
weather a run on their deposits,
consumers could be evaluated by the
liquidity and quality of their
assets and how well they could
withstand an immediate call by all
their creditors, Ms. Blayney says.
Add up your emergency savings, the
equity in your home and the balances
in your retirement savings accounts
to get your total assets. Then
divide that number by your monthly
expenses to figure out how many
months you could live with no
investment appreciation and no
income until you have completely
depleted those assets.
Take two people, each with a net
worth of $1 million. The first
person has securities and cash
accounts, the second has her money
tied up in real estate. Which one
could pay the bills more quickly
with less of a discount to convert
assets to cash?
“You need to
look at the liquidity of the net
worth and the quality of it,” she
says.
Corrections & Amplifications
To calculate debt-to-income
ratio, divide your debts by pretax
earnings. An earlier version of this
post incorrectly said the ratio was
obtained by dividing pretax earnings
by debts.
Jensen Comment
The article should have given more
consideration to tax planning. For
example, I would give consideration to
combining savings liquidity with tax
exempt income in a diversified tax
exempt mutual fund such as a a low cost
fund (with a checkbook) available from
Fidelity or Vanguard. Care must be
taken, however, to have long-term
savings that are better protections
against inflation such as CREF accounts.
Real estate is a tricky investment due
to property taxes and insurance. If
there's sufficient rental to cover these
expenses such as in a condo or
profitable farm then real estate is more
attractive as a long-term investment.
For example, I have a friend who kept
his condo beside the Dartmouth College
campus long after he moved on. He now
calls this condo his cash cow.
However, I don't like being a landlord
--- which is why I sold my inherited
Iowa farm and invested mostly in our
home and in a tax exempt mutual fund
from Vangard. However, I'm old now so
that inflation is less of a worry in my
remaining lifetime.
Bob Jensen's threads on personal
finance ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
"Here's The Painstakingly Detailed
Budget Of A Couple Who Earns Nearly
$15,000 A Month," by Libby Kane,
Business Insider, January 26, 2015
Question
Suppose you were teaching a financial
literacy course and used the following
monthly budget for a couple. What would
you focus on to stimulate student
debates on the issues.
Hints
·
The couple earns $180,000 after-tax
withholdings and tax estimated
additional payments per year (assuming
both adults work giving rise to the day
care allowance).
·
My calculation assuming a 4% APR 30-year
mortgage initially is that the couple
owns a home originally costing $345,150
plus whatever they made in a down
payment. This price would be relatively
high in a decadent farming town in Iowa
and relatively low in a suburb of most
major cities. It would be a tent in
Silicon Valley. It would not be much of
a house within a walking distance of
virtually all major universities in the
USA.
The house probably cost a lot less if
the $1,647.80 payment also covers
property taxes and mortgage insurance.
Have your students estimate the original
cost of the home if the payments on the
mortgage itself are only $1,000 per
month. They must be living in an old
shack or a cramped town house.
·
The life insurance seems relatively low
for a family with young children.
·
The "out-to-eat" budget is relatively
low and can be used up entirely with two
nights out at nice restaurants per
month. The family must eat out mostly at
fast-food and pizza joints. One way to
save money plus eat healthy meals is to
eat at a nearby hospital like we did in
both San Antonio (where the Northeast
Baptist Hospital was only a block away).
Eating at the hospital was cheaper than
cooking at home. Erika worked full time
at this hospital.
·
The electric bill of $200 would not
cover our electric bill with heating and
air conditioning while we lived in San
Antonio where the electricity and gas
bill was over $400 per month. In the
White Mountains of New Hampshire
electricity, propane and heating oil
would be more like $1,000 per month.
It's very cold up here.
·
I think for a younger family not of
Medicare the medical, dental, and
prescription drug allowance is way too
low in the budget shown in the article
below. For retired folks like us on
Medicare the medical, dental and
prescription outlays would be much, much
higher --- more like $1,500 per month.
Younger folks naively think Medicare is
"free" after you retire. It's not free
when you add in the cost of Medicare
itself, the cost of Medicare
supplemental insurance, and the
out-of-pocket costs of medicine not
covered by Medicare D.
·
How about the other monthly estimates?
Are they realistic for the USA?
Are important items deleted in terms of
most families?
o
In San Antonio where I watered my lawn
with a sprinkling system my water and
sewer bills were over $200 per month
o
My Time Warner cable bill is now over
$160 per month
o
What about those monthly iPhone usage
fees?
o
How about home owner insurance and
umbrella (liability) insurance?
o
How about lawn and garden equipment such
as a garden tractor and lawn mowers and
snow throwers?
o
What about furniture and appliance
costs? Up here in the boondocks I spend
quite a lot on extended on-site
warranties.
When you teach from this budget you
might go into more details regarding
possible tax strategy and retirement
strategy pros and cons.
"Here's The Painstakingly Detailed
Budget Of A Couple Who Earns Nearly
$15,000 A Month," by Libby Kane,
Business Insider, January 26, 2015
---
http://www.businessinsider.com/detailed-budget-of-high-earning-couple-2015-1
February 1, 2015 reply from Patricia
Walters
Bob
Not every place charges for water. We
had a well in VA and we paid electricity
and maintenance for the pump, not for
the water.
We had a lawn mower in VA. Here we have
someone come and cut our grass who has
the equipment, about 100 per month in
the growing season only. No snow. Even
in VA we had shovels, not power tools.
No TV, only cable for internet. Biggest
utility charges electricity (we have big
OLD house) and phones.
We don't know where these people live.
Costs vary widely depending on location,
even within counties.
Are there homes in Fort Worth that cost
over a million? Sure. But there are also
homes in reasonable neighborhoods for
less than $150,000. I live in one of
those neighborhoods.
I've lived in NYC, NJ, VA and now TX.
Costs vary widely across those places
and within those places.
One if their biggest expenditure was
school, which seemed likely to me.
Why do you doubt the truth of their
budget?
Pat
February 2, 2015 reply from Bob Jensen
Hi Patricia,
I did not doubt the truth of their
budget, but I did think they left a few
things out or were ambiguous about some
things that need to be clarified by a
teacher or students using this budget in
a financial literacy course.
For example, the $1,687 mortgage payment
could be the mortgage alone or it could
also cover property taxes, homeowner
insurance, and mortgage insurance. Take
those away from the payment and you are
left with a fairly low-sized mortgage.
In my case the property taxes are $1,000
per month but they are not part of my
mortgage payment in these mountains. In
fact the property tax payment and the
mortgage payment only differ by $200
because I paid over 60% down at the time
of purchase. Later I refinanced the
remaining mortgage for 3.6% for 30
years. I pay the homeowners insurance
separately, and that's not cheap up
here.
Most people cannot afford such a large
down payment unless they're retired. In
rural mountain and ocean properties the
banks typically require larger down
payments than in towns. In many
instances former owners must finance the
homes they sell.
When I taught at the University of Maine
I had an ocean cottage that could not be
financed except by an owner. Banks would
not loan on shore property in those
days. That made interest rates highly
variable, because they were part and
parcel to sales price negotiations.
Owners also typically demand large down
payments when they finance sales
properties.
I also wanted a mortgage so I could play
the game of having more itemized tax
deductions plus invest more in a
long-term insured tax-exempt mutual fund
that pays only slightly less than by
mortgage interest rate. The standard
deduction sucks, but you have to have a
sizable amount of itemized deductions to
cover the minimum threshold for itemized
deductions..
I could pay the mortgage off any time,
but I don't want to due to a tax
strategy that might be debated by
students in a financial literacy course.
That's why I suggest having students
debate alternate tax strategies at the
same time they are discussing household
budgeting.
Having a deep water well makes me not
concerned about the cost of water usage.
Wells only get expensive when you have
to replace the well and or the pressure
tank and pump. Two of my neighbors had
to replace their wells, and it cost each
of them thousands of dollars.
With a well also comes a septic system.
The risk here is having to replace the
drain fields for broken tiles. That
expense depends a lot on having
sufficiently high ground for another
field. You can't put a new drain field
over an old drain field or in low land
that does not drain well from rain and
snow melt.
A B&B down the road is having all sorts
of troubles finding a suitable place for
a new drain field. The small hotel has
been empty for over a year in part
because of this problem and the need for
a new well.
In San Antonio you could get housing
relatively close to Trinity University
for less than $200,000 but most faculty
who do so either do not have children or
send their children to private schools
(which is really expensive). Also crime
risks are higher near campus relative to
most outer northern parts of the city.
By higher crime risk I mean that I don't
recommend walking near campus at night
and having to have high quality home
security systems.
Trinity has very safe and well lighted
walking, jogging, and biking trails on
campus that are heavily patrolled by
officers on bicycles. These trails are
used a lot by neighbors not affiliated
with the University. It's a public
service.
Thanks for your thoughts,
Bob
From the CPA Newsletter on September 3,
2014
How retirement planning has changed
since ERISA was enacted
http://r.smartbrief.com/resp/gbsdBYbWhBCJbSoSCidKtxCicNRJcg?format=standard
The Employee
Retirement Income Security Act was
enacted in 1974 in response to some
much publicized failures of private
defined benefit (or pension) plans.
Rebecca Miller, CPA, Robert
Lavenberg, CPA, J.D., and Ian
MacKay, CPA, CGMA, mark ERISA's 40th
anniversary with a look back at the
challenges ERISA was originally
intended to address and the issues
facing retirees now and in the
future.
Journal of Accountancy print issue
(9/2014)
Bob Jensen's threads on pension
accounting ---
http://faculty.trinity.edu/rjensen/Theory02.htm#Pensions
Fees =
Transactions Costs (when buying or selling shares) plus Fund Management Fees
(paid annually to professionals who manage your portfolio like the managers at
TIAA/CREF, Fidelity, Vanguard, etc.). manage your retirement funds.
Taxes =
Capital Gains Taxes (that apply even on
retirement funds like CREF when you make
eventual withdrawals). Note that capital
gains taxes must be paid by your estate
on the balances left in your retirement
funds. Most of us won't get hit with
estate taxes (due to high estate tax
exemptions), but we all get hit with
capital gains taxes on the retirement
funds and farms we leave behind for
heirs.
Inflation =
Loss in Buying Power of Saving Dear
Money That Turns Into Cheap Money (even
under your mattress)
The government is now misleading us
about inflation by taking price
increases for food and fuel out of its
reported inflation index so you
think that your dollars are still dear
when they are cheap in terms of things
that you buy day-by-day. Economists
are whores for politicians.
Government deficit spending and
obligations for $100 trillion in
unfunded entitlements (like Medicare and
Medicaid) make inflation the biggest
worry of the three diseases on
retirement savings --- fees, taxes, and
inflation.
"Here's How Little
You Earn On Stocks After You Pay The
Man, Uncle Sam, And The Invisible Hand,"
by Myles Udland, Business Insider,
August 29, 2014 ---
http://www.businessinsider.com/thornburgs-real-real-equity-returns-2014-8
Fees,
taxes, and even inflation just kill
your investment returns.
A
Thornburg Investment Management
study of "real, real returns,"
which was
alerted to us by
Cullen Roche at Pragmatic Capitalism,
shows
how various costs eat into your
stock market returns.
Real, real returns take into account
expenses (the man), taxes (Uncle
Sam), and inflation (the invisible
hand).
Thornburg's study notes that
"nominal returns are a misleading
driver of an investor's investment
and asset-allocation planning...
because they are significantly
eroded by taxes, expenses and
inflation." The risk then, as
Thornburg sees it, is that a failure
to understand real, real returns
could lead to investment decisions
that miss potential diversification
opportunities.
This chart from Thornburg shows how
the annualized nominal return of
$100 invested in the S&P 500 between
1983 and 2013 is about 11%, making
that investment worth $2,346.
However, on a real, real basis that
investment returns 6%, making it
worth just $570.
A
pretty stark difference between
expectations and reality.
Jensen Comment
There are ways of partly beating the tax
man by investing a portion of your
retirement funds in a tax-exempt mutual
fund that holds bonds of school
districts, towns, cities, counties, and
states. However, I say "partly beats" in
the sense that value changes in those
funds are subject to capital gains taxes
even if the interest on those bonds that
builds up your savings are not taxed
while your earn that interest or when
you withdraw that interest. A second
drawback is that there is relatively
more risk in investing in a given
tax-free municipal bond versus a taxable
high-grade corporate bond. But huge
diversified tax-free mutual funds like
those of Fidelity and Vanguard. A third
drawback in theory is that
tax-free bonds should earn less interest
than corporate bonds. This is not always
the case in this era of stupid
quantitative easing by the Federal
Reserve that keeps interest rates on CDs
and high-grade corporate bonds close to
zero. Tax-free interest rates have held
up batter in this idiotic era of
quantitative easing since the crash of
2007.
Remember that higher
return investments also carry higher
financial risks beyond the savings
killers of fees, taxes, and inflation.
For example land investments have less
inflation risks but are subject to many
other financial risks. For example,
think of paying a million dollars for an
Iowa farm that sold ten years ago
$500,000 and doubled in value because of
the corn ethanol government mandate for
gasoline. The added financial risk for
your new farm is that one day soon the
government will come to its senses and
remove the ethanol mandate for fuel,
thereby leaving the corn for cows and
hogs. Your million dollar farm may
plunge in value --- thus the added
investment risk beyond the retirement
savings killers of fees, taxes, and
inflation.
"The
Crushingly Expensive Mistake Killing
Your Retirement: 401(k) fees
are costing you hundreds of thousands of
dollars over your lifetime," by
Matthew O'Brien, The Atlantic,
February 15, 2014 ---
http://www.theatlantic.com/business/archive/2014/02/the-crushingly-expensive-mistake-killing-your-retirement/283866/
Jensen Comment
Investors should probably question
whether they need to pay a financial
advisor on top of the unavoidable
expenses of managing a mutual fund.
Investors should also seek out lower
cost fund management funds such as
Fidelity, Vanguard, and TIAA/CREF. Most
of the more expensive funds are
delivering addedreturns that justify the
added costs unless they have taken you
into financial risks you don't
understand.
The big funds offer a lot of free
advising services that you should
investigate before running down to a
personal advisor in a glitzy office
building.
"5
Little-Known Ways To Save Money On
Amazon ," by Grayson Bell, Debt
Roundup via Business Insider,
August 29, 2014 ---
http://www.businessinsider.com/ways-to-save-money-on-amazon-2014-8
Jensen Comment
If you are an active buyer like me on
Amazon it probably pays to become a
Prime member.
One advantage of living in the boon
docks is home delivery when you're not
at home. I know the rural mail carrier
(Mary), the UPS driver (Joe), and the
FedEx driver all by name. They leave the
deliveries in our unlocked garage in
rain, snow, or shine. When I lived in
San Antonio I would've not dared to
leave our garage unlocked. City living
is just more scary and a hassle in many
other ways.
Don't forget to use your accumulated
payment credits on Amazon. Amazon makes
it really easy to use those points when
making a payment.
"How to Choose a Charity Wisely," by John F. Wasik, The New York Times,
November 7, 2013 ---
http://www.nytimes.com/2013/11/08/giving/how-to-choose-a-charity-wisely.html?ref=giving&pagewanted=all&_r=0
DONATING to
charities this time of year used to
be relatively efficient and
painless. After watching the Macy’s
Thanksgiving Day Parade, you plunked
some money into a Salvation Army
bucket, wrote some checks,
contributed some household items and
were done.
Yet with
charities increasingly involved in
awareness campaigns, complex
networks of cause marketing and
often exorbitant overhead, donating
to the most effective charity has
never been more challenging.
If you are a
discriminating giver, you will need
a set of guidelines that can tell
you if your donation will mostly be
spent on a charity’s mission and not
peripheral activities. These days
you have to use your head far more
than your heart to see that your
charitable dollars are well spent on
causes you care about.
There are
services and strategies that you can
use to make an informed decision.
Most of them can help you determine
if your dollars will reach the
charity’s “mission” — and whether a
nonprofit organization is effective
in what it is striving to do.
Charities are
already witnessing greater
selectivity among donors, probably
driven by the pinch of a sluggish
economy. According to The Chronicle
of Philanthropy, a trade newspaper
for the nonprofit sector, donations
to the top 400 fund-raising
charities are slowing this year
after gaining 4 percent in 2012.
Last year, the top nonprofits took
in about $81 billion.
Although such
things are hard to measure, it is
possible that donors have become
more sophisticated in their giving
as useful information on charities
has become more detailed. Yet it is
easy to get distracted by ubiquitous
causes that blanket every corner of
society. Herewith, a guide to
navigating the thicket.
The
Major Services
One of the
first stops in searching for
charities is
GuideStar,
which contains records from 1.8
million nonprofits registered with
the Internal Revenue Service.
The free
component of the GuideStar website
provides access to each
organization’s Form 990, the basic
I.R.S. filing document for
nonprofits. That is useful on the
front end if you want basic
information on a charity’s income,
spending, mission and executive
salaries.
As with the
other services, you can also pay for
“premium” services from GuideStar
that provide more financial analysis
and access to a nonprofit’s
contractors. This would help if you
wanted to perform detailed
comparisons of charities or to
explore their financial ratios or
executive compensation
in greater
depth.
What GuideStar
does not do is give a qualified
rating of a charity. It tries to
remain neutral and “is not a charity
evaluator,” says Lindsay J. K.
Nichols, a spokeswoman. For more
intensive evaluations, you need to
go to the BBB Wise Giving Alliance
or Charity Navigator.
The
BBB Wise Giving Alliance,
affiliated
with the Council of Better Business
Bureaus, has free reviews of 1,300
national charities; local BBBs have
evaluations on an additional 10,000.
The group applies 20
“accountability” standards —
governance, oversight, effectiveness
and the like — once every two years
at no charge to the charities, but
it does not explicitly rate them
using a star or letter system.
The alliance
will specify if a charity does not
meet BBB standards or “did not
disclose the requested information.”
About 40 percent of the charities
evaluated meet
all 20 benchmarks; ones
that do are designated a “BBB
Accredited Charity.”
Organizations
accredited by the alliance can then
pay a sliding-scale fee based on
their size to obtain a license to
use the BBB Charity Seal on websites
and fund-raising material. About 60
percent of those qualifying elect to
pay the fee for the seal.
Like GuideStar
and Charity Navigator, the alliance
cautions against paying too much
attention to the percentage spent on
nonprogram expenses, also known as
the “overhead ratio.”
The alliance’s
approach appears to be more rigorous
than the other two services’,
although its findings are not
compiled into an overall rating.
Organizations are deemed
“accredited” (met standards),
“standards not met,” “unable to
verify,” “did not disclose” and
“review in progress.”
Still, the
group’s focus on audited financial
statements and accountability — it
also publishes in-depth newsletter
articles on the subject — is a
pragmatic way to view a charity’s
operations.
Art Taylor,
the alliance’s president, said the
group “sees where the charity is at
on our 20 standards, which goes to
the heart of how a charity
functions.”
To customize a
search and get charity-specific
ratings, Charity Navigator, which
evaluates about 7,000 nonprofits,
has an easy-to-use interface to find
charities that match your interests.
Focusing on
financial health, accountability and
transparency,
Charity Navigator
applies an
analysis to each of its charities to
come up with its star ratings (with
four stars as the highest rank). It
examines federal Form 990s to see
how much of a charity’s income goes
toward programs and what percentage
is spent on administration and
fund-raising. Of the three major
services, Charity Navigator is the
easiest to use.
Generally, a
good benchmark for a worthwhile
charity is having at least 75
percent of income spent on programs,
or the nonprofit’s mission,
according to Sandra Miniutti, a
spokeswoman for Charity Navigator.
Aside from
vetting a charity’s financials, Ms.
Miniutti suggests, donors should
“understand the charity’s mission —
pick just a few, do your research
and stick with them over time.”
Getting Granular
Want to dig
deeper and go beyond the charity
information services? You can use
them to find basic information on
revenue, fund-raising and spending,
but you will need to go several
layers deeper if you want additional
scrutiny. Here are some major issues
to consider:
■ Have you
compared the charity’s Form 990 with
its annual report and audited
financial statements?
The 990 can
often be opaque and may not tell you
particulars on an organization’s
specific programs. You may need an
accountant or
financial adviser
acquainted
with nonprofit accounting to review
these documents; the audited
financials contain much more detail.
■ Does the
charity practice “joint cost
allocation?”
This is
accounting jargon for lumping in
fund-raising or solicitation with
the charity’s program expenses.
According to the BBB Wise Giving
Alliance, more than 20 percent of
nationally solicited charities it
reviews employ this practice, which
could muddy the waters in gauging
how much is really being spent on
the charity’s mission. To get a
clearer picture, you will need to
identify the charity’s primary
purpose. If it is mainly a
grass-roots lobbying or public
awareness organization (which means
you may not be able to deduct your
donation), then joint cost
allocation may make sense. If it
devotes its efforts to financing
research, then the allocation may be
a red flag.
■ How does
the charity evaluate its
effectiveness?
You should be
able to see some examples in its
annual reports. Also, ask the
charity directly about its
successes. Does the organization use
independent auditors to benchmark
its performance? Where has it
failed? A transparent charity should
provide this information along with
progress reports.
Eric Friedman,
author of “Reinventing Philanthropy”
(Potomac Books, 2013), says
charities that cannot gauge their
effectiveness through benchmarks
“may have effective programs, but
it’s hard for donors to understand
how effective or compare them to
other options. I’ve stopped focusing
on financial measures, which can be
misleading.”
■ Is the
mission supported by academic
research?
Organizations
may be funding ineffective ways of
addressing their mission. A boutique
charity information service like
GiveWell
recommends only three organizations
a year out of the hundreds it has
considered since its founding in
2007. GiveWell performs extensive
research to show that recommended
charities are “proven,
cost-effective, scalable and
transparent,” said Alexander Berger,
its senior research analyst.
“Because we’re aiming to find the
best giving opportunities possible —
not to rate every charity — we don’t
research charities that are unlikely
to excel on our criteria.”
■ Watch
out for red flags.
Because
nonprofit accounting and reporting
can be incomplete, suspicious
activity can be hidden. Daniel
Borochoff, president of
CharityWatch,
formerly known as the American
Institute of Philanthropy, rates 600
charities with a grading system from
A to F — and takes a watchdog
approach that tries to expose
nonprofit abuses. “There’s a lot of
sneaky reporting going on,” Mr.
Borochoff said. He said chicanery
could often be found in “gifts in
kind,” where donations may be
overvalued, or in organizations with
emotional appeals — some charities
involving animals, children, first
responders and veterans. They may be
little more than aggressive
fund-raising operations that do
little for their missions, or funds
that are diverted to officers or
other purposes.
■ Do you
need comprehensive advice?
If you are
also concerned about tax or
estate planning
considerations, it would make sense
to work with a wealth manager,
estate-planning lawyer or certified
financial planner. Many advisers
also have insights into nonprofit
accounting that can help you vet a
charity on a deeper level. Robert J.
DiQuollo, chief executive of Brinton
Eaton Wealth Advisors in Madison,
N.J., said he could scrutinize
nonprofit line items like executive
salaries and program-related
expenses. “We always approach the
charity directly,” Mr. DiQuollo
said, “to make sure that the charity
is spending money on what the donor
wants.”
■ Is the
charity sitting on too much cash?
You need to
know if the charity is putting its
cash to good use or reserving it for
some other purpose. According to
Wise Giving Alliance standards, “the
charity’s unrestricted net assets
available for use should not be more
than three times the size of the
past year’s expenses or three times
the size of the current year’s
budget, whichever is higher.” This
is something you may need an
experienced accountant to evaluate.
The bottom line: As a donor, you
need to know if your money will be
put to work immediately or
sidelined.
Due
Diligence
¶ What can you
do with these ratings and reams of
financial information? Although you
can become immersed in nonprofit
accounting arcana and employ all of
the charity research services, your
efforts may still not tell you if a
charity is worthwhile.
Continued in article
"Five Really Dumb Money Moves Retirees Make: How to Avoid Ever
Having to Say 'I Lost the Nest Egg'," by Tom Lauricella, The Wall Street
Journal, February 23, 2014 ---
http://online.wsj.com/news/articles/SB10001424052702303775504579394930456252714
After
decades of saving for retirement,
you never want to end up saying, "I
lost the nest egg."
For most
people, retirement savings will need
to be carefully tended if they are
to last two or three decades, a
typical life span after collecting
one's final full-time paycheck.
But there
are plenty of mistakes that can be
made. Some can deplete that nest egg
in one fell swoop, while others can
result in a slow bleed that becomes
apparent only over time.
Some
missteps to avoid:
1.
Big purchases.
It's a
natural instinct for new retirees to
want to kick back and treat
themselves following decades of hard
work.
Ronald
Myers, an adviser at Associated
Financial Consultants in Fort
Lauderdale, Fla., talks about
clients who see some of their
retirement funds as their "YOLO
money"—You Only Live Once.
"I'm the
first guy to say go out and enjoy
yourself early on—you aren't going
to get any healthier," says Mr.
Myers. But it's crucial, he says, to
avoid blowing a hole in a retirement
plan at the get-go. And given the
uncertainty of the market, the depth
of that hole may not become apparent
until much later in life.
He points
to example of a retiree who plans to
withdraw $25,000 a year from a
$500,000 nest egg starting off by
taking $50,000 to buy a boat—two
years of income.
Should that
big withdrawal be followed by a
market decline, the result could be
many years shaved off the time those
savings will last.
2.
No cushion.
In
retirement, a major, unexpected
expense can quickly send a financial
plan off the rails. But that doesn't
have to happen.
"I see a
lot of people cutting it really
close and living paycheck to
paycheck, even though they are
really paying themselves" out of
their savings, says Blair duQuesnay,
director of investments at
ThirtyNorth Investments in New
Orleans.
The problem
comes when an emergency crops up
that requires laying out extra cash
on short notice. If that outlay
requires selling investments in the
middle of a market downturn, the
retiree could be locking in losses
that can't be recovered.
"It takes
planning ahead," says Ms. duQuesnay.
Her firm advises clients to keep six
months to one year's worth of cash
on hand for replenishing that
stockpile.
3.
Forgetting common sense.
Remember:
"There's no such thing as a free
lunch."
That's
especially the case with investments
promising big payoffs with low risk.
People
"have a unique ability to suspend
common sense, believing that
strangers want to let us in on deals
that are too good to be true, which
of course, are," says Alan Roth, a
financial planner in Colorado
Springs, Colo.
Mr. Roth
says there are often telltale signs
it's time to hang up the phone on a
sales pitch. They include: a sense
of urgency ("The deal is only good
today!"), using a church or
fraternal organization to vouch for
its credibility or a play on
emotions.
4.
Reaching for yield.
The "no
free lunch" risk to a nest egg also
applies to investors who have cut
back on holdings of relatively safe
but low-yielding government bonds
and bulked up on riskier investments
that offer meatier yields—like
high-yielding junk bonds, bank-loan
funds or dividend-paying stocks.
"When you
substitute a fixed-income,
low-volatility investment for a
higher-volatility investment, the
risk of a loss of principal in a
down market is much higher," says
Ms. duQuesnay.
A simple
litmus test for how well that
higher-yielding investment will act
are returns from during the
financial crisis. Bank-loan funds,
for example, lost an average of
29.7% in 2008.
5.
Letting emotions rule.
"Acting
emotionally in a down market could
be mistake No. 1" when it comes to
wrecking a nest egg, says Mr. Myers.
He
acknowledges that retirees who need
their savings to help pay the bills
will feel the pull of reacting to
short-term losses. "During
retirement, it's behavioral
economics on steroids," he says.
Retirees
should build a portfolio that meets
their long-term goals and one where
they can withstand watching the
inevitable downs in the markets that
come with the ups.
To put it
another way, says Mr. Roth: "It's
dumb to buy high and sell low."
Jensen Comment
It's hard to advise future retirees
without knowing what they really do
enjoy. For example, I think it's dumb to
invest in retirement businesses unless
you really, really enjoy retirement
businesses or really, really need the
income from retirement businesses. For
example, a widow purchased a three-story
house just down the road when she was a
widow over 60 years of age. For a while
making jewelry to pay for her mortgage
payments seemed like a good idea. Now
taking her truck and camper all alone to
out-of-state jewelry shows has become a
drag, but she needs the income in part
because revaluations of her home have
really clobbered her with higher
property taxes in a down market (at
least up here). Tax appraisers care more
about village and school expenses than
what property will realistically sell
for up here in the remote White
Mountains.
It's probably a good idea that she
invested in her jewelry business, but at
her present age it's become more
depressing. I don't think she's enjoying
her "retirement," especially since she
must do most of the house maintenance by
herself. Last summer she was on a huge
40-foot extension ladder scraping and
painting by herself almost every
sunny day.
She also splits her own wood to heat
that big house. What was her mistake? It
was probably a mistake to purchase such
a big house without the annual cash flow
to cushion the expenses of taxes and
maintenance while thinking she would
forever enjoy making jewelry and
traveling to shows.
There's also a couple that I know who
both retired from the military and
invested $2 million in a bed and
breakfast (mostly financed with three
mortgages). Running a B&B sounded like
fun until the reality of cooking
breakfast for guests seven days a week
became a drag year after year after
year. Even with hired maid service,
there are endless days of maintaining
the grounds, keeping the plumbing
working in 26 bathrooms, painting and
papering 24 rooms, washing windows,
fixing roof leaks, patching an ancient
heating system, operating the front
desk, dealing with happy and
not-so-happy happy guests, and on and on
and on. Retirement? What's that? They
were more retired while on active duty.
Then there's a retiree friend down on
the highway who purchased a $180,000
motor home hoping to entice a woman
friend into marrying him and touring all
over North America. She considered the
idea for 20 minutes and then said no
way. The motor home with less than 500
miles on the odometer sat in his front
yard with a "For Sale" sign for over
five years (he lives on a state highway
where drivers passing by could see the
thing year after year). At long last he
sold the thing, but I don't want to
embarrass him by asking how much he lost
on this dream (beside losing his
would-be bride). He had 12 nice cabins
and land out back that our village took
over due to defaulted property tax
payments.
I paid too much for a retirement
acreage, but I do enjoy this type
isolated rural living. It would be a
risk if my health failed and I had to
hire everything done around here.
However, I'm fortunate to have the
retirement cash flow to do so if I must
eventually hire everything done. And the
outdoor work winter and summer is
currently much more enjoyable than
boring exercise routines in a gym. If
and when I become gaga and have to go
into a nursing home my estate will take
a huge hit because it's impossible to
recover much more than half of what I
paid for this property in an up market
before the real estate crash.
However, in spite of contentment with
my own retirement, it's important to
note that many of those things you
dreamed about all your working years may
change over the course of your
retirement. Firstly, you may lose some
of your good health. Secondly, you may
lose your spouse that was part of your
retirement dreams all those years. And
yet at age 65 when you're both in good
health it probably would be a bummer
moving into an assisted living apartment
too soon. You both might quickly become
depressed and bored to death in a small
apartment if you have good health for
the next 10-25 years.
My own parents started their marriage
in the Great Depression and never really
got over feeling that saving was much,
much more important than consumption.
Being an only child I eventually
inherited their life savings. But all
they while they were retired I argued in
vain that they should spend more to
enjoy their retirement. But then
again if they were spending more to
enjoy their retirement they would
probably would not have enjoyed their
retirement. They were more happy
living a very modest life beneath what
they could well have afforded. Unlike me
they did not enjoy expensive restaurants
and hotels. They ordered the cheapest
things on menus in small farm town
restaurants and pretended those were the
selections they enjoyed the most as long
as there was a salad bar.
My mother always said: "If
you're going to buy big, buy black
dirt."
Bob Jensen's threads on personal
finance ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Question
Why do so few people going into retirement decide against lifetime fixed
annuities?
Jensen Answer
In 2006 I opted for TIAA lifetime annuities that pay out a fixed amount of
monthly income for as long as my wife and/or I are alive. Other options included
variable lifetime annuities (that go up and down with the stock market) and
lump-sum withdrawals of cash that we could manage ourselves. Lump-sum withdrawal
might have been more attractive if we were already sufficiently wealthy to have
retirement needs covered. Then we could have given more away to family and
charities. But we were not that wealthy.
A lifetime annuity works best if you
live many years beyond when all your
retirement funds are depleted. A
lifetime annuity is the gift that keeps
on giving.
A lifetime annuity works best if you
live many years beyond when all your
retirement funds are depleted. A
lifetime annuity is the gift that keeps
on giving.
At our ages inflation is less of a risk concern than for younger people who
are still investing toward retirement. However, if I were advising a younger
person who becomes eligible for a TIAA payout because of a divorce I would
stress the inflation risks of a very long-term fixed annuity. A variable annuity
becomes a better option depending upon age.
The huge unexpected benefit from our 2006 TIAA retirement deal was that our
fixed monthly annuity income was not affected by the economic crash of 2008 like
it would have been with a variable lifetime annuity. Since the stock market
eventually recovered such losses in monthly income would have eventually
recovered pretty well except for the losses before the stock market bounced
back.
It was just plain luck that I retired in 2006 rather than 2009. The decision
of the Federal Reserve to drive interest rates down to nearly zero coupled with
the Quantitative Easing program must have made it very difficult for TIAA to
offer fixed annuity deals after 2008 like the deal I negotiated in 2006.
However, I did not investigate the difference between the monthly annuity amount
I negotiated in 2006 with the amount I could have negotiated with TIAA in
2009.
Note that interest rates on safe investments like bonds and CDs have not
bounced back like the stock market. This is because of the damaging policies of
the Federal Reserve on the what used to be safer investments --- safer
investments that now return virtually zero. I don't look for safe investments to
return much of anything for a long, long time. The Fed has forced investors to
take on more financial risks with its low-interest policies that don't don't
seriously show signs of change in our troubled unemployment economy.
There are various other considerations when negotiating a retirement annuity,
some of which are discussed by Harvard's Justin Fox in the article below. I
listened carefully to the advantages and disadvantages of retirement annuities
that the TIAA counselor laid out for me before I signed on the dotted line. One
consideration for me was the 10-year grace period in which a declining balance
in our retirement fund balance goes into our inheritance estate if Erika and I
both die before 2016. After 2016 nothing of this balance goes into our estates
and if we live long enough TIAA takes a big hit. However, we felt that we had
sufficient outside savings to make our children sufficient bequests if we pass
on after 2016. Retirees without much in the way of outside savings might not
like this 10-year limit.
There are also other uncertainties. For example, there can be tax advantages
or disadvantages of lump-sum withdrawals at retirement. Investors who feel
almost certain that income taxes are going to become much higher in the future
might opt for a lump-sum payout. Those that think taxes will be lower are less
inclined to opt for the lump-sum payout, although there are other
considerations. For example, if I had taken a lump-sum payout I probably would
have invested most of the payout in an insured long-term tax exempt mutual fund
even though there are ups and downs in the values of such funds --- even though
the tax-free cash flows are fairly steady month-to-month.
I did not cover some of the points mentioned by Justin Fox in the article
below.
Always take advantage of the free investment counseling of your Personnel
Department and the companies trying to sell you a retirement annuity. Personally
I'm not a big fan of paying for investment advice since there are so many free
services from TIAA, Vangard, Fidelity, etc. Professionals in these outfits will
talk to you for free.
"What Do People Have Against Retirement Income?" by Justin Fox,
Harvard Business Review Blog, February 25, 2014 ---
http://blogs.hbr.org/2014/02/what-do-people-have-against-retirement-income/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+harvardbusiness+%28HBR.org%29&cm_ite=DailyAlert-022614+%281%29&cm_lm=sp%3Arjensen%40trinity.edu&cm_ven=Spop-Email
Bob Jensen's free investment helpers that may not be worth the price are
at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelper
"6
Retirement Accounts You Should Know
About (Part2)," by Laura Adams,
Money Girl, April 23, 2013, Episode
311 ---
http://moneygirl.quickanddirtytips.com/retirement-plan-types-pt2.aspx
Frontline broadcast on "The Retirement
Gamble,"April 23, 2013 ---
http://www.pbs.org/wgbh/pages/frontline/retirement-gamble/
For details see
http://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/retirement-gamble/the-retirement-gamble-facing-us-all/
If you’ve
been watching any commercial
television lately, you are well
aware that the financial services
industry is very busy running
expensive ads imploring us to worry
about our retirement futures. Open a
new account today, they say.
They are
not wrong that we should be doing
something: America is facing a
retirement crisis. One in three
Americans has no retirement savings
at all. One in two reports that they
can’t save enough. On top of that,
we are living longer, and health
care costs, as we all know, are
increasing.
But, as I
found when investigating the
retirement planning and mutual funds
industries in The Retirement Gamble,
which airs tonight on FRONTLINE,
those advertisements are imploring
us to start saving for one simple
reason. Retirement is big business —
and very profitable. It doesn’t take
a genius to figure out that the more
we save into the industry’s
financial products, the more money
they make in fees and commissions
trading our hard-earned cash. And as
long as they don’t run away with our
money or invest it in a Ponzi
scheme, they have little in the way
of accountability to us when
something goes wrong. And even then
it can be hard to fight back.
Big banks,
brokerages, insurance companies and
other financial service providers
operate under something called a
suitability standard — which says
they don’t have to give you the best
advice, just advice that isn’t too
egregiously terrible.
Let’s say
you sit down with an adviser at your
brokerage or bank and ask for some
advice on how you should allocate
your retirement savings, or which
funds you might want to choose for
your IRA.
You’ll get
lots of advice, but chances are it
won’t be worth much. Eighty five
percent of all financial advisers
and financial planners are really
just brokers or salesman. Their
incentive is to sell you a product
that makes them a higher commission,
not necessarily a product that
maximizes your chances of saving
more. Only 15 percent of advisers
are “fiduciaries” — advisers who by
law must operate with your best
interests in mind.
Last year,
the Obama administration proposed a
rule to mandate that all financial
advisers, financial planners and
other assorted financial wizards
would have to adopt a fiduciary
standard when it came to employee
retirement accounts such as your
401(k) or IRA account. The financial
services industry, which today
manages something upwards of $10
trillion of our retirement nest
eggs, thought this was a bad idea
and pushed back hard. Scores of
their protest letters poured into
the U.S. Labor Department, the
branch of our government responsible
for regulating employee retirement
accounts.
Congress,
too, was hit with a furious lobbying
campaign. This would be way too
expensive, the industry said; if we
have to provide such a standard of
service, we will either have to pack
up and find another business line,
or have to pass the increased costs
on to our customers. The Obama
administration pulled their proposal
last fall.
How would a
new fiduciary rule change things?
Chances are you would be sold less
expensive products, not only in your
IRA accounts but inside your company
401(k) as well. It’s all about fees.
While reporting on retirement plans
for FRONTLINE, nothing has been more
surprising to me than the corrosive
effect of fees on our retirement
savings.
It’s this
simple: Fund fees can erode as much
as half or more of your prospective
gains.
For the
sake of dramatizing the point, John
Bogle, founder of Vanguard, the
world’s largest mutual fund company
and pioneer of low-cost index funds,
gave me a startling example while we
were filming. Assume you are
invested in a mutual fund, he says,
with a gross return of 7 percent,
but that the mutual fund charges you
an annual fee of 2 percent.
Over a
50-year investing lifetime, that
little 2 percent fee will erode 63
percent of what you would have had.
As Bogle puts it, “the tyranny of
compounding costs” is overwhelming.
In short,
fees matter. So what can you do? You
aren’t going to find a fund that
invests your money for free, but
experts say you can come close by
buying index funds. Their fees can
be a tenth of what the average
mutual funds charges. And over time,
in bull and bear markets, on
average, index funds perform better
than their more expensive actively
managed fund cousins. This is no
secret to anyone who is paying
attention.
So why
aren’t our trusted financial
advisers and those ads telling us to
buy index funds? Why do some 401(k)
plans not even offer them on their
menus?
It’s
because even though an index fund
might be a better option for you and
me, a broker operating under a
suitability standard has no
incentive to sell it to us. He or
she will make higher commissions
from options that have higher fees.
Sadly, a
recent AARP study reported that 70
percent of mutual fund savers were
not even aware that they were paying
any fees at all.
Continued in article
Dan
Stone's summary of the above Frontline
show:
Enjoyed it though didn't find much
new here. Basic messages:
1. index funds are cheaper and, in
the long run, preferred (Jack Bogle)
2. managed funds are a scam to
generate fees for the mutual fund
industry
(which some would certainly debate)
3. most Americans don't have enough
for retirement
4. mutual funds make it hard to
determine their fees
5. the financial services industry,
through massive donations, prevents
any
attempts to increase transparency in
the financial services industry.
I've bought Pound Foolish, after
hearing an interview with its
author, but haven't
started reading it yet
(http://www.amazon.com/Pound-Foolish-Exposing-
Personal-Industry/dp/1591844894)
Dan
Stone
Bob Jensen's personal finance helpers
(but not his advice which is free and
not worth the money) ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Remember that my financial advice is
free and probably not worth the money.
After selling the family farm in Iowa
and my home in San Antonio, most of my
liquid savings is invested in an
enormous Vanguard Long-Term
"Guaranteed" Tax Exempt Fund.
"Apocalypse, Not Now, for Municipal
Bonds," by Randall W. Forsyth,
Barron's, April 23, 2013 ---
http://online.barrons.com/article/SB50001424052748703889404578438641361922074.html?mod=BOL_da_udwsd#articleTabs_article%3D0
$573.2 million in Munis defaulted in
2013 (0.6% of the $3.7 trillion
outstanding) versus 1.01% for 2013 .
My investment returns were very
satisfactory and stable throughout the
economic crisis that sent stocks
soaring.
At my age I care more about steady
annual tax-exempt cash flows rather than
valuation ups and downs and hyper
inflation risk.
When I need cash for something big like
a new tractor I simply write a Vanguard
check. I love the liquidity of this
fund.
Fortunately, however, my TIAA lifetime
annuities cover virtually all of our
living expenses, including payments on a
large mortgage.
I could write a Vanguard check to pay
off the mortgage, but there are tax
advantages of not doing so unless
unlikely tax reform clobbers tax exempt
interest income.
Sadly,
more than half of today’s U.S. retirees will rely on Social Security for more
than 50% of their total income, leaving them with the
painful choice of either a rather severe drop in living standards, or else
risking prematurely exhausting savings and being at the mercy of children or
relatives.
"Latest DALBAR report underscores poor long-term performance of individual
investors," The Mathematical Investor, July 2014 ---
http://www.financial-math.org/blog/2014/05/latest-dalbar-report-underscores-poor-long-term-performance-of-individual-investors/
As we
emphasized in a December 2013
Mathematical Investor blog,
individual
investors are not very well
equipped, and certainly not very
effective, in managing their own
investment portfolios.
This is
unfortunate, because fewer
workers than in the past,
particularly in the U.S., are
covered by a “defined-benefit”
retirement system, namely a
pension that guarantees a
certain proportion of one’s
income at retirement, based on
the number of years in service,
in perpetuity until one’s death.
Instead, the majority of the
growing army of American baby
boomers (according to the
Population Reference Bureau,
76.4
million Americans were born in
the period 1946-1966) have to
rely on 401K systems or the
equivalent, where they must
contribute (along with matching
contributions, in many cases, by
employers) to an investment fund
that they have either partial or
full discretion to manage.
Indeed, more than any generation
before, the present generation
of workers will be personally
responsible for their future
financial well-being.
Other nations are facing similar
challenges. In Canada, for
instance, their version of
“social security” provides only
about half what it does in the
U.S. In Australia, large
employers such as universities
typically place roughly 17% of a
worker’s income into a
“superannuation fund”. In New
Zealand, this fraction is 7%. In
Canada, pension savings are
taxed as they are withdrawn,
whereas in Australia
superannuation funds are not
taxed provided they are
withdrawn as annuities. In
continental Europe, mandatory
retirement rules still exist,
while in the English-speaking
world, such rules, mercifully,
are largely a thing of the past.
How well
are today’s workers doing in
saving for retirement? Sadly,
more than half of today’s U.S.
retirees will rely on Social
Security for more than 50% of
their total income,
leaving
them with the painful choice of
either a rather severe drop in
living standards, or else
risking prematurely exhausting
savings and being at the mercy
of children or relatives. Many
should at least
lower their expectations for
life after retirement, but there
is little evidence that most
workers nearing retirement are
facing this unpleasant reality.
Of even
greater concern is the level of
skill with which most individual
investors manage their nest
eggs. We mentioned in our
earlier
Mathematical Investor blog a
report known as the
Quantitative Analysis of
Investor Behavior, produced
by the
DALBAR organization, which
attempts to measure short- and
long-term success by individual
investors. In that blog, we
cited results from the 2012
report.
Now the
latest (2014) edition of
this report is available. So how
well are today’s investors
doing? The results are even more
discouraging than in previous
reports. The report notes that:
-
Over the past 20 years,
“equity fund” investors
achieved an average 5.02%
annualized return, which is
4.2% less than the 9.22%
that he/she could have
achieved by simply investing
funds in an S&P500
index-tracking fund. This
gap expanded in
2013, for only the third
time in ten years.
-
Over the bull market of the
past three years, “equity
fund” investors achieved
only an average 10.87%
annual return, lagging the
average annual S&P500 return
(16.18%) by 5.31%.
-
Investors in “asset
allocation funds” did even
more poorly. Their 20-year
average annual return was
only 2.53%, lagging the
S&P500 index (9.22% per
annum) by 6.69% per annum.
-
Investors in “fixed income
funds” did more poorly
still. Their 20-year average
annual return was an abysmal
0.71%, fully 8.51% less than
the S&P500 index, and 5.03%
per annum less than the
Barclay’s Aggregate Bond
Index (5.74% per annum) over
this time.
-
Not surprisingly, investors
show little evidence of
skill in “market timing.”
The DALBAR report notes that
in the six best months of
2013, when the market was up
sharply, there was no
evidence that individual
investors moved more than
average amounts into equity
funds.
As
MarketWatch commentator Paul
Merriman
observes,
the
typical investor’s emotion-based
trading in and out of securities
based on fear and knee-jerk
reaction to crises is
counter-productive to long-term
success:
Every year the conclusion
[of the DALBAR report] is
the same: On average,
investors earn less than
mutual fund performance
figures imply. Sometimes
they earn much less. … One
conclusion: No matter
whether the market is
booming or busting,
“Investor results are more
dependent on investor
behavior than on fund
performance.” Investors who
buy and hang on are
consistently more successful
than those who move in and
out of the markets.
In our
previous
Mathematical Investor blog,
we
emphasized how the typical
individual investor is
relatively poorly educated and
informed about making personal
financial decisions. As the U.S.
Securities and Exchange
Commission noted in a
2012 report, “investors
have a weak grasp of elementary
financial concepts and lack
critical knowledge of ways to
avoid investment fraud.”
These
experiences are exacerbated by
the larger plague of
disappointing performance in
mathematics and science
education. This was underscored
today with the release of the
latest results for U.S. 12th
graders on the
National Assessment of
Educational Progress (NAEP) test.
The
overall score of 153 in
mathematics is identical to that
from 2009, and is only slightly
higher than the 150 score in
2005, in spite of years of
effort and billions of dollars
spent to improve K-12 education.
The DALBAR report concludes
Attempts to correct
irrational investor behavior
through education have
proved to be futile. The
belief that investors will
make prudent decisions after
education and disclosure has
been totally discredited.
Instead of teaching,
financial professionals
should look to implement
practices that influence the
investor’s focus and
expectations in ways that
lead to more prudent
investment decisions.
Similarly,
Louis S. Harvey, President of
DALBAR,
argues
that
It is now past the time for
the investment community and
its regulators to understand
that the principle of
educating uninterested
investors about the
complexities of investing is
unproductive. … We need a
fundamental change that
transforms investment
thinking into meaningful
decisions and choices for
retail investors.
[Added 12
May 2014: A
column
by Chuck Jaffe summarizes a
study by Natixis Global Asset
Management on why investors
often make poor financial
decisions.]
"The Science Behind Social Security Benefits Calculations," by
Theodore J. Sarenski, AICPA, October 20, 2014 ---
http://blog.aicpa.org/2014/10/the-science-behind-social-security-benefits-calculations.html#sthash.t77ImEv5.i4UykguJ.dpuf
While the
Social Security Administration
calculates Social Security benefits,
it is your due diligence to know the
basics so that you can understand
how an additional year of earning
will affect your clients’ projected
benefit.
Continued in article-
Jensen Comment
This is more about understanding the
regulations than science. The
regulations are a bit complicated.
"Offering
a Helping Hand on Retirement Savings:
New Website Provides Investment Novices
Free Portfolio Recommendations; Asking
Questions of the CEO," by Katherine
Boehret, The Wall Street Journal,
June 5, 2012 ---
http://professional.wsj.com/article/SB10001424052702303506404577448503218010424.html
How often do you tinker with your
retirement savings? Many people
think about this when starting a job
or opening a 401(k), but sometimes
not again until they are ready to
retire. According to financial
advisers, that's too late.
This week, I forced myself to look
at accounts I rarely monitor as I
tested FutureAdvisor.com, a website
founded by two former Microsoft
engineers who are also a registered
investment adviser and chartered
financial analyst, respectively.
They wanted to create an easy way
for people to manage their
retirement savings, primarily using
index funds, and they based the
site's suggestions on what they
consider to be the best practices in
the industry and in academia.
FutureAdvisor, which has no ads,
bills itself as a free alternative
to paying a lot for financial advice
from professionals, who often charge
a 1% annual fee or work on
commission. Many big investment
firms offer retirement-savings
services, but these generally don't
offer step-by-step advice for an
investor's complete portfolio.
FutureAdvisor expects to make money
when it introduces later this year
an optional premium service, which
will charge an annual fee of less
than 0.25% of your assets to
rebalance and maintain your
portfolio, automatically. It says
suggestions offered on the site are
made solely on merit, with no
kickbacks or commissions to
FutureAdvisor.
The site differs from budgeting
sites like Mint.com that don't
specialize in retirement savings.
Instead, Mint makes money through
recommendations for users, like
which credit cards carry lower fees.
I'm not a financial expert; rather,
I looked at FutureAdvisor through
the lens of an average person who
might want to use the site. Its
investment philosophy may not be
right for everybody.
FutureAdvisor is easy to use and
walks users through a set of simple
steps. There's no asset minimum to
use the site, though people who are
already in retirement can't use it.
Pop-up explanations and options to
submit questions to the site's CEO
and co-founder, a registered
investment adviser, are available as
you go.
For security purposes, FutureAdvisor
uses bank-level, 128-bit SSL (Secure
Socket Layer) encryption for all
communications. It can't move money
or make transactions; instead,
people do this by clicking on links
that send them to their financial
institutions where they may pay a
fee for certain transactions. Login
information is never stored on the
website; rather, it's handled by
partner company Yodlee.
To get started with FutureAdvisor, I
entered my email and a password to
create an account and then answered
questions about myself. These
included birthday, current annual
income, desired retirement age,
desired retirement income, age when
I started consistently saving for
retirement, approximate value of my
retirement investments and marital
status. Thankfully, messages that
say, "What is this?" appear beside
each question, explaining why it's
asked.
Next, you enter the names of
brokerage firms that handle your
accounts, like Fidelity for a 401(k)
or T. Rowe Price for a Roth IRA. If
you don't already have online
accounts with each of these firms,
you must set up accounts on their
websites so you can return to
FutureAdvisor, enter your username
and password and access your data.
FutureAdvisor recognized a lot of
different brokerage firms that I
searched for, and this week it added
Thrift Savings Plans, or TSPs, which
are used by government employees,
including military personnel. If a
brokerage firm isn't on the site,
you can suggest it in a feedback
box. I did this, and my requested
firm was added within hours.
When personal questions are answered
and brokerage-firm information is
retrieved, FutureAdvisor asks you to
choose a conservative, moderate or
aggressive approach with
explanations of each. I chose an
aggressive option because of my
relatively young age. Various charts
filled the screen showing
recommendations for my stock/bond
split, equity style, diversification
split and glide style. Terms like
this may lose average users, but
brief explanations beside them
helped, and I read a References and
Citations pop-up menu filled with
sources from which the advice was
generated.
The most helpful section of the site
showed recommendations for my
portfolio.
Continued in article
FutureAdvisor ---
https://www.futureadvisor.com/
-
"(More) Clarity on Adjunct Hours
(including healthcare insurance
guidance)," by Doug Lederman, Inside
Higher Ed, February 11, 2014 ---
http://www.insidehighered.com/news/2014/02/11/irs-guidance-health-care-law-clarifies-formula-counting-adjunct-hours
The Obama
administration on Monday
released its long-awaited final
guidance
on how colleges should calculate the
hours of adjunct instructors and
student workers for purposes of the
new federal mandate that employers
provide health insurance to those
who work more than 30 hours a week.
The upshot
of the complicated regulation from
the Treasury Department and the
Internal Revenue Service:
-
On adjuncts,
colleges will be considered on
solid ground if they credit
instructors for 1 ¼ hours of
preparation time for each hour
they spend in the classroom, and
instructors should be credited
for any time they spend in
office hours or other required
meeting time.
-
On student workers,
the IRS
opted to exclude work-study
employment from any count of
work hours, but the
administration declined to
provide an exemption for student
workers over all. As a result,
colleges and universities will
be required to provide health
insurance to teaching and
research assistants who work
more than 30 hours a week.
Adjunct Hours
The issues
of how to count the hours of
part-time instructors and student
workers have consumed college
officials and faculty groups for
much of the last 18 months, ever
since it became clear that the
Affordable Care Act definition of a
full-time employee as working 30
hours or more a week was leading
some colleges to
limit the hours
of adjunct
faculty members, so they fell short
of the 30-hour mark.
All that
the government said in its
initial
January 2013 guidance
about the employer mandate under the
health care law was that colleges
needed to use "reasonable" methods
to count adjuncts' hours.
In
federal testimony
and at
conferences,
college
administrators and
faculty advocates
have debated
the appropriate definition of
"reasonable," with a focus on
calculating the time that
instructors spend on their jobs
beyond their actual hours in the
classroom. The American Council on
Education, higher education's
umbrella association and main
lobbying group, proposed a ratio of
one hour of outside time for each
classroom hour, while many faculty
advocates have pushed for a ratio of
2:1 or more.
In its new
regulation, published as part of a
complex 227-page final rule in
today's Federal Register,
the government said that it would be
too complex to count actual hours,
and it rejected proposals to treat
instructors as full time only if
they were assigned course loads
equivalent or close to those of
full-time instructors at their
institutions.
The
administration continued to say that
given the "wide variation of work
patterns, duties, and circumstances"
at different colleges, institutions
should continue to have a good deal
of flexibility in defining what
counts as "reasonable."
But in the
"interest of predictability and ease
of administration in crediting hours
of service for purposes" of the
health care law, the agencies said,
the regulation establishes as "one
(but not the only)" reasonable
definition a count of 2.25 hours of
work for each classroom hour taught.
"[I]n addition to crediting an hour
of service for each hour teaching in
the classroom, this method would
credit an additional 1 ¼ hours
service" for "related tasks such as
class preparation and grading of
examinations or papers."
Separately,
instructors should also be credited
with an hour of service for each
additional hour they spend outside
of the classroom on duties they are
"required to perform (such as
required office hours or required
attendance at faculty meetings," the
regulation states.
The
guidance states that the ratio --
which would essentially serve as a
"safe harbor" under which
institutions can qualify under the
law -- "may be relied upon at least
through the end of 2015."
By choosing
a ratio of 1 ¼ hours of additional
service for each classroom hour, the
government comes slightly higher
than the 1:1 ratio that the higher
education associations sought, and
quite a bit lower than the ratio of
2:1 or higher promoted by many
faculty advocates.
David S.
Baime, vice president for government
relations and research at the
American Association of Community
Colleges, praised administration
officials for paying "very close
attention to the institutional and
financial realities that our
colleges are facing." He said
community colleges appreciated both
the continued flexibility and the
setting of a safe harbor under
which, in the association's initial
analysis, "the vast majority of our
adjunct faculty, under currernt
teaching loads, would not be
qualifying" for health insurance,
Baime said.
Maria
Maisto, president and executive
director of New Faculty Majority,
said she, too, appreciated that the
administration had left lots of room
for flexibility, which she hoped
would "force a lot of really
interesting conversations" on
campuses. "I think most people would
agree that it is reasonable for
employers to actually talk to and
involve employees in thinking about
how those workers can, and do,
perform their work most effectively,
and not to simply mandate from above
how that work is understood and
performed," she added.
Maisto said
she was also pleased that the
administration appeared to have set
the floor for a "reasonable" ratio
above the lower 1:1 ratio that the
college associations were
suggesting.
She
envisioned a good deal of confusion
on the provision granting an hour of
time for all required non-teaching
activities, however, noting that her
own contract at Cuyahoga Community
College requires her to participate
in professional development and to
respond to students' questions and
requests on an "as-needed basis."
"How does this regulation account
for requirements like that?" she
wondered.
Student Workers
The adjunct
issue has received most of the
higher education-related attention
about the employer mandate, but the
final regulations have significant
implications for campuses that
employ significant numbers of
undergraduate and graduate students,
too.
Higher
education groups had urged the
administration to exempt student
workers altogether from the employer
mandate, given that many of them
would be covered under the health
care law's policies governing
student health plans and coverage
for those up to age 26 on their
parents' policies. The groups also
requested an exemption for students
involved in work study programs.
The updated
guidance grants the latter exemption
for hours of work study, given, it
states, that "the federal work study
program, as a federally subsidized
financial aid program, is distinct
from traditional employment in that
its primary purpose is to advance
education."
But all
other student work for an
educational organization must be
counted as hours of service for
purposes of the health care mandate,
Treasury and IRS said.
Steven
Bloom, director of federal relations
at the American Council on
Education, said higher ed groups
thought it made sense to exempt
graduate student workers, given that
their work as teaching assistants
and lab workers is generally treated
as part of their education under the
Fair Labor Standards Act. He said
the new guidance is likely to force
institutions that employ graduate
students as TAs or research
assistants -- and don't currently
offer them health insurance as part
of their graduate student packages
-- to start counting their hours.
The
guidance also includes a potentially
confounding approach to students who
work as interns. The new regulation
exempts work conducted by interns as
hours of service under the health
care employer mandate -- but only
"to the extent that the student does
not receive, and is not entitled to,
payment in connection with those
hours."
Continued in article
Jensen Question
How should a university account for a
doctoral student who happens to teach 33
hours one semester and works less than
30 hours in all other semesters of the
doctoral program? Is the university
required to provide health coverage for
zero, one, or more years while the
student is a full time student in the
doctoral program? I assume the
university must provide health insurance
for one year, but I'm no authority on
this issue.
There also is a huge difference in
hours of work required for teaching. A
doctoral student who only teaches
recitation sections under a professor
who provides the lecture sections,
writes the syllabus, writes the
examinations, and essentially owns a
course versus a doctoral student who
owns only section of governmental
accounting with no supervision from a
senior instructor.
When I was Chair of the Accounting
Department at Florida State University,
the wife (Debbie) of one of our doctoral
students (Chuck Mulford) had total
control of the lectures and 33
recitation sections of basic accounting
each semester where most of the
recitation "instructors" were accounting
doctoral students. Debbie had her CPA
license and a masters degree, but she
was not a doctoral student. She was very
good at this job. The recitation
instructors had almost no preparation
time and did not design or grade the
examinations. They did not own all 33
sections like Debbie owned all 33
sections. It would be a bit unfair to
give the recitation instructors as much
pay for preparation as the selected
doctoral students who taught more
advanced courses and essentially owned
those courses in terms of classroom
preparation and examinations.
Bob Jensen's threads on
controversies in higher education
(including use of adjuncts) ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm
"The Law About Debt Collections
Harassment," by Laura Adams,
Money Girl, May 21, 2013 ---
http://moneygirl.quickanddirtytips.com/debt-collections-harassment.aspx
Individual Retirement Account ---
https://en.wikipedia.org/wiki/Individual_retirement_account
Deciding Between a Roth vs. Traditional IRA in 2018---
https://money.usnews.com/money/retirement/articles/deciding-between-a-roth-vs-traditional-ira
Teaching Case
From The Wall Street Journal Accounting Weekly Review on January 10, 2014
Delaying IRA
Contributions Can Be Costly
by: Jonnelle Marte
Jan 05, 2014
Click here to view the full article
on WSJ.com
TOPICS: Individual
Income Taxation, Individual
Taxation, IRA Contributions, IRAs
SUMMARY: Taxpayers
can contribute up to $5,500 each
year to individual retirement
accounts--$6,500 for those over 50.
"An analysis of traditional and Roth
IRA contributions made by Vanguard
Group customers for the 2007 through
2012 tax years showed that, on
average, 41% of the dollars
contributed to IRAs for any given
tax year are invested between
January and April of the following
year. Half of those dollars are
contributed in the first half of
April...and only 10% of dollars are
contributed in January of the
corresponding tax year...." A time
value of money comparison in the
article shows that this habit-which
most advisers think stems from
investor laziness-can cost a
substantial difference in final
savings available at retirement
CLASSROOM APPLICATION: The
article may be used in a class on
personal taxes or when covering
topics in the time value of money.
QUESTIONS:
1. (Advanced) What is an
individual retirement account? A
Roth IRA?
2. (Advanced) According to
tax law, when are taxpayers allowed
to make IRA deductions?
3. (Introductory) According
to findings by Vangauard Group from
analyzing their customer deposits to
IRA accounts, when do most taxpayers
make IRA contributions?
Reviewed By: Judy Beckman,
University of Rhode Island"
"Delaying IRA Contributions Can Be
Costly," by Jonnelle Marte, The Wall
Street Journal, January 5, 2014 ---
http://online.wsj.com/news/articles/SB10001424052702304477704579256610849790176?mod=djem_jiewr_AC_domainid
It's a new
year. And that means it's time for
investors to do what they could have
done last year—but didn't.
Namely:
make contributions to their 2013
individual retirement accounts.
Indeed, an analysis of traditional
and Roth IRA contributions made by
Vanguard Group customers for the
2007 through 2012 tax years showed
that, on average, 41% of the dollars
contributed to IRAs for any given
tax year are invested between
January and April of the following
year. Half of those dollars are
contributed in the first half of
April—the final weeks when
contributions for the previous year
can be made.
The study
found only 10% of dollars are
contributed in January of the
corresponding tax year, the earliest
month contributions can be made. "We
are trying to encourage people to
change their way of thinking and
think about it sooner," says Maria
Bruno, a senior investment analyst
with Vanguard Investment Strategy
Group. Valid Excuse?
There are
legitimate reasons that big dollars
flow into IRAs near the tax-filing
deadline. At that point, taxpayers
typically know whether their income
for the prior year was low enough to
qualify for deductible
contributions, and can see by
exactly how much a contribution
would lower their tax bill.
But some
advisers say the habit is one of the
ultimate examples of investor
laziness, nearly on par with not
maxing out the company match for
401(k) contributions or not seeking
retirement advice until after
retirement.
"As humans
we naturally procrastinate," says
Mackey McNeill, an accountant and
financial adviser in Bellevue, Ky.
Procrastination can be costly. The
problem, advisers and retirement
consultants say, is that investors
who make IRA contributions at the
last moment miss out on 16 months of
potential gains (from January of one
year until April of the following
year), as well as the chance for
those gains to compound over many
years. Even if two investors
contribute the same amount of money
over the years, the person who
starts earlier could end up with
significantly more savings down the
line.
Compare a
saver who makes the maximum annual
IRA contribution of $5,500 for those
under age 50 in January of each year
with another saver who contributes
the same amount each April 15 of the
following year. Over 31 years,
assuming the money is invested in a
moderate portfolio earning a
hypothetical 7% annual return, the
saver who makes full contributions
in January could end up with $83,000
in additional savings after 30
years, even though both investors
contributed equal amounts—about
$170,500—overall, according to an
analysis by Ms. McNeill. Tax Burden
Another
downside to putting off
contributions: It could add to your
tax bills. Money in a taxable
account over that 16-month period
may incur gains that would have been
deferred in an IRA, says Ed Slott,
an accountant and founder of
IRAHelp.com, a website for
retirement savers.
Some pros
say investors' excuses for not
contributing as early as possible
are looking thin. Most people don't
see their income swing wildly from
one year to the next, Ms. Bruno
says. They can likely use last
year's tax return to decide whether
to make a contribution for the
current tax year each January.
Procrastinators still have time to
change their ways. Some can catch up
if they now make their 2013 and 2014
contributions—a total of $11,000 for
those under 50 contributing the
maximum for each year, Ms. McNeill
says. Those investors can then get
in the habit of making their IRA
contributions at the start of each
year. (Investors 50 or older can
contribute as much as $6,500 to
their IRAs each year.)
While a
doubled-up contribution is a lot to
set aside at once, she says: "You've
only got to make this change for one
year."
Controversy and Scandal Surrounding
John Hancock and the Compounding of Interest
"Our signature 1776 revolutionary: John Hancock's role as treasurer
left an uneasy Harvard," Harvard Gazette, July 2, 2013 ---
http://news.harvard.edu/gazette/story/2013/06/our-signature-1776-revolutionary/
Jensen Comment
To this day, many people in the USA do
not understand the difference between
simple interest versus annual
compounding versus continuous
compounding ---
http://en.wikipedia.org/wiki/Compound_Interest
Except for very long holding periods,
continuous compounding does not add all
that much to annual compounding. But
compounding adds a huge amount relative
to simple interest.
For example, if the Lenape Indians in
1626 had invested the $24 they received
for Manhattan at 6% compounded annually
they could perhaps buy the island back
in 2013 for the accumulated savings of
$149,135,522,178.18. In my first
course in economics this was a footnote
in the famous textbook by Paul Samuelson
(with slightly different numbers). If
this was indexed over time for inflation
and exempt from taxation the Lenapes
could perhaps buy the entire State of
New York in 2013.
It's no wonder that in 1793 Harvard
University badly wanted $529 accumulated
compound interest owed by the John
Hancock estate.
"Wallet.AI Aims to Serve Up
Location-Based Financial Advice: An app called Wallet.AI wants to put a
financial advisor in your pocket," by Rachel Metz,
MIT's Technology Review, September 23, 2013 ---
Click Here
http://www.technologyreview.com/news/519346/walletai-aims-to-serve-up-location-based-financial-advice/?utm_campaign=newsletters&utm_source=newsletter-daily-all&utm_medium=email&utm_content=20130924
Mortgage Rate Calculation Tools
---
http://www.mortgagerates.net/additional-resources/calculation-tools/
Bob Jensen's threads on online
calculators ---
http://faculty.trinity.edu/rjensen/Bookbob3.htm#080512Calculators
Smart About Money - National Endowment
for Financial Education ---
http://www.smartaboutmoney.org/
"Teach Financial Literacy,"
by Steven Bahls, Chronicle of Higher Education, June 13, 2011 ---
http://www.insidehighered.com/views/2011/06/13/essay_on_responsibility_of_colleges_to_teach_financial_literacy
As
a college president, I ask students
and graduates what are we doing
correctly and what can we improve
upon. The typical responses to how
we can improve are not surprising —
more parking and more financial aid
(often in that order). Lately the
most common answer from recent
graduates as to how we can improve
has been surprising — more education
about financial literacy and the
practical aspects of living in
today’s world.
I hear the following comments with
increasing frequency, particularly
since the Great Recession of 2008:
-
had no idea of the impact of my
student debt and credit card
debt on my ability to live a
comfortable life after college.
-
Living in the residence halls
and dining at the college, I
didn’t need to know about
budgeting and renting an
apartment. I had no idea how to
create a budget so I could live
responsibly and comfortably on
my salary.
-
In college I learned how to
cultivate a pointed argument,
but quickly learned that in the
workplace an aggressive argument
can get you fired. No one told
me about how to disagree with
your boss and not have your job
threatened.
Faculty and administrators at
liberal arts colleges do not shy at
complex thinking. We tend to
scrutinize the details even as we
comprehend the big picture. We look
for connections among areas of
thought, and revel in a multitude of
perspectives. By the end of their
four years on campus, our students
have benefited from a well-rounded,
richly layered education. I believe
most even recognize what it means to
be liberally educated. Having
learned to "turn the crystal" as
they develop their views and goals,
they are confident and able to find
success on many levels.
Why then do so many recent graduates
seem unable to demonstrate sound
decision-making in an area as
fundamental as finances and entering
the work world?
Is it possible that in our efforts
to foster creative and critical
problem solving, we neglect the
basics of responsible day-to-day
living and working? As we carefully
engage students in discerning shades
of gray, is it at the expense of
black and white?
Two events have led me to ask these
questions. First is the number of
conversations like those described
above, with graduates who confided
to me their frustrating lack of
“real-world” financial knowledge.
The second is the fact of the high
loan default rate among recent
college graduates, which is 7
percent nationwide (Augustana’s rate
is 4.2 percent). I know I am not
alone in asking the question: What
should we do?
Personal Prosperity and the
Common Good
Jon Meacham, the former editor of
Newsweek, addressed the 2011
Council of Independent College
Presidents Institute. Meacham
praised the role of liberal
education, noting that "people who
know about Shakespeare tend to
create the Internet." But if
appreciating Shakespeare and other
skills common to a liberal education
is viewed by most as "quaint and
quirky," liberal education will not
survive. Instead, he argues that
liberal education must be "vital and
relevant" by "training young minds
to solve problems and to see what
others have yet to see and to think
energetically about creating jobs
and wealth," which Meacham calls the
"oxygen of democracy."
I'd go one step further than
Meacham. Our graduates can’t create
wealth and jobs if they don’t have
the ability to balance a checkbook,
or the skills to hold a job.
When asked to define "personal
success," I think it is fair to
suggest that most college freshmen
would put "financial success" toward
the top of their list. As they begin
taking liberal arts courses, they
connect their learning to other
aspects of their lives, and many
begin to think of a career as
something more than just a paycheck.
They develop meaningful working
relationships with faculty members
and other students, and may
experience some peaks in their
education — whether through an
internship, international study,
research with faculty or other
achievements in their major studies.
Their definition of success develops
more facets.
At Augustana College, we have long
promoted high-impact learning
experiences as well as the close
relationships that allow integrated
and collaborative learning to
flourish. Recently we have begun to
take new steps toward teaching
certain life skills fundamental to
ensuring success of all kinds.
Leadership about financial literacy
must come from the top. I remind our
students that if they live like
college graduates with good jobs
while they are students, their debt
levels will cause them to live like
students when they graduate. Going
out to a mid-priced restaurant twice
a week for four years could easily
cost $8,000. Putting those charges
on a credit card and carrying the
balance over four years tips the
cost to well over $10,000.
Five years ago, before the severe
economic downturn, we introduced a
class on personal finance. Offered
each spring and fall term, the class
is packed with seniors and some
juniors. Having read Plato and
Neruda, spent hours upon hours
working in our human cadaver or
volcano lab, or climbed Machu
Picchu, these students suspect they
must improve their financial
literacy before they graduate.
Their instructor, an alumnus retired
banker, begins by teaching how to
use financial templates. The
students create a personal profile
and then produce a cash flow
statement for the previous year.
After clarifying their own
understanding of their financial
history, which generally is filled
with gaps until this class, they
work with their instructor on the
process of creating a budget for the
next year. Taking into account three
to four personal financial goals
(e.g., paying for students loans,
emergency funds, etc., and even
retirement), the students lay their
financial path for the future. At
all times throughout the class they
keep in mind their current net
worth, and how that value should
affect their financial decisions.
The course is such a success that,
given the financial illiteracy
demonstrated by too many young
alumni, we now are offering a free
three-hour seminar as a "crash
course" in personal finance for our
graduating seniors.
Sharing Responsibility
Augustana is not the only liberal
arts college to offer such a class,
and there is more we all can do.
Many liberal arts colleges are
adding majors that address personal
financial viability in a changing
world and also attract prospective
students in an increasingly
competitive market.
Augustana’s
newest majors — which extend from
traditional majors — include graphic
design, neuroscience, environmental
studies, multimedia journalism and
engineering physics, among others.
While some of our faculty state
concerns that our college’s liberal
arts foundation might be shaken by
the contemporary and perhaps more
fiscal focus of these programs,
most see the new majors as logical
progressions
of traditional
fields and therefore deeply related
to our college’s mission.
Continued in article
Bloomberg Business Week asked that I
share the following links with you:
1.
Personal Finance News:
http://www.bloomberg.com/personal-finance/
2. Saving and Investing:
http://www.bloomberg.com/personal-finance/saving-and-investing/
3. Retirement Planning:
http://www.bloomberg.com/personal-finance/retirement-planning/
4. Real Estate Investing:
http://www.bloomberg.com/personal-finance/real-estate/
5. Tax News:http://www.bloomberg.com/personal-finance/taxes/
6. Financial Advisers:
http://www.bloomberg.com/personal-finance/financial-advisers/
7. Insurance and Health:
http://www.bloomberg.com/personal-finance/insurance-and-health/
8. Financial Calculators:
http://www.bloomberg.com/personal-finance/calculators/
9. Businessweek Magazine Online:
http://www.businessweek.com/subscribe/
I also
added the Financial Calculators link to
http://faculty.trinity.edu/rjensen/Bookbob3.htm#080512Calculators
I added
the tax news to
http://faculty.trinity.edu/rjensen/AccountingNews.htm#News
Inside Footnotes (advice from and for security analysts) ---
http://www.footnoted.com/inside-footnotes/
"What’s Wrong with the Financial
Services Industry?" by Barry
Ritholtz, Ritholtz Blog, February
21, 2013 ---
http://www.ritholtz.com/blog/2013/02/whats-wrong-with-the-financial-services-industry/
If you hang
around these parts for any length of
time, you will occasionally run
across a jeremiad of mine
complaining about the Financial
Services Industry.
I’ve been
thinking about this more than usual
lately. This has led to some
correspondence with Helaine Olen,
whose book
Pound Foolish: Exposing the Dark
Side of the Personal Finance
Industry
is next up in my queue. (Her
appearance on the
TDS yesterday is here).
It is similar
to the deep dive my colleague Josh
Brown took in
Backstage Wall Street.
My
criticism is somewhat different than
Helaine’s (though I am sympatico
with much of her view). I break down
the problems as follows:
•
Simplicity does not pay well:
Investing should be relatively
simple: Buy broad asset classes,
hold them over long periods of
time, rebalance periodically,
get off the tracks when the
locomotive is bearing down on
you. The problem is its easier
in theory than is reality to
execute this.
•
Confusion is not a bug, its a
feature: Thus,
the massive choice, the nonstop
noise the confusing claims, all
work to make this much more
complex than it needs to be.
•
Too much money attracts the
wrong kinds of people:
Let’s face it, the volume of
cash that passes through the
Financial Services Industry is
enormous. Few who enters finance
does so for altruistic reasons.
•
Incentives are
misaligned: As
I’ve written previously, too
many people are unwilling to get
rich slowly. Hence, some of the
wrong people work in finance,
and some of the right people
exercise bad judgment.
•
Too many people have a hand in
your pocket:
The list of people nicking you
as an investor is enormous.
Insiders (CEO/CFO/Boards of
Directors) transfer wealth from
shareholders to themselves, with
the blessing of corrupted
Compensation Consultants. Active
mutual funds charge way too much
for sub par performance. 401(k)s
are disastrous. NYSE and NASDAQ
Exchanges have been paid to
allow a HFT tax on every other
investor. FASB and Accountants
have doen an awful job, allowing
corporations to mislead
investors with junk balance
statements. The Media’s job is
to sell advertising, not provide
you with intelligent advice. The
Regulators have been captured.
What’s the net impact of all
this on your investments ?
•
The Financialized US Economy:
The above list reflects nearly
half a century of the
financialization of the broader
US economy. Instead of serving
industry, finance has trumped
it. This led directly to the
financial crisis and economic
collapse of 2007-09.
•
Human Nature:
Then there is your own
behavioral issues. On top of
everything else, you are
governed by a
brain that simply wasn’t built
for this.
All of
these add up to a system that is
flawed, and often fails to do its
job.
Continued in article
Large public accounting firms are
probably not in favor of simplifying the
tax code
February 17, 2013 message from Richard
Sansing
This week's
issue of The Economist has a special
report on
off-shore finance. This article
discusses the role of large
public accounting firms.
http://www.economist.com/news/special-report/21571556-accounting-firms-will-do-nicely-under-any-set-rules-merry-enablers
Jensen Content
Note that
"simplicity does not pay well" in
consulting!
I wonder to what extent large CPA firms
want simplified accounting and auditing
rules (to increase profits on audits)
and highly complex regulations and
financing alternatives (to increase
profitability of consulting). Thus far
in the 21st Century everything seems to
becoming more complicated., which is
probably why audits are not especially
profitable relative to consulting.
However, unless a new regulation is
put in place to rotate audit firms,
auditing contributes heavily to fixed
costs annually due to the tendency of
clients to stick with the same auditing
firms year after year. Consulting
engagements come and go making them not
especially reliable for paying fixed
costs but making them profitable on top
of the fixed costs paid for by audit
engagements. Thant's my $.02.
Definition of Screwed:
avg mkt return ~12%, avg mutual fund ret ~9%, average investor ret ~ 2.6%.
Timing, selection, and costs destroy
Finance Professor Jim Mahar
"Romancing Alpha (α), Breaking Up with Beta (β)," by Barry Ritholtz,
Ritholtz, February 15, 2013 --- |
http://www.ritholtz.com/blog/2013/02/alpha-beta/
Since it is a Friday (following Valentine’s Day), I
want to step back from the usual market gyrations to discuss a broader
topic: The pursuit of Alpha, where it goes wrong, and the actual cost in
Beta.
For those of you unfamiliar with the Wall Street’s
Greek nomenclature, a quick (and oversimplified) primer: When we refer to
Beta (β), we are referencing a portfolio’s correlation to its benchmark
returns, both directionally and in terms of magnitude.
We use a scale of 0-1. Let’s say your benchmark is
the S&P500 — it has a β = 1. Something uncorrelated does what it does
regardless of what the SPX does, and its Beta is = 0. We can also use
negative numbers, so a Beta of minus 1 (-1) does the exact opposite of the
benchmark.
Beta measures how closely your investments perform
relative to your benchmark. If you were to do nothing else but buy that
benchmark index (i.e., S&P500), you will have captured Beta (for these
purposes, I am ignoring volatility).
The other Greek letter we want to mention is Alpha
(α). Alpha is the risk-adjusted return of active management for any
investment. The goal of active management is through a combination of
stock/sector selection, market timing, hedging, leverage, etc. is to beat
the market. This can be described as generating Alpha.
To oversimplify: Alpha is a measure of
out-performance over Beta.
Why bring this up today?
Over the past few months, I have been looking at an
inordinate number of portfolios and 401(k) plans that have all done pretty
poorly. I am not referring to any one quarter of even year, but rather, over
the long haul. There is an inherent selection bias built into this group —
well performing portfolios don’t have owners considering switching asset
managers. But even accounting for that bias, a hefty increase in the sheer
number of reviews leads me to wonder about just how widespread the
under-performance is.
One of the things that has become so obvious to me
over the past few years is how unsuccessful various players in the markets
have been in their pursuit of Alpha. We know that 80% or so of mutual fund
managers underperform their benchmarks each year. We have seen Morningstar
studies that show of the remaining 20%, factor in fees, and that number
drops to 1%.
The overall performance of the highest compensated
group of managers, the 2%+20% Hedge Fund community, has been similarly
awful, as they have underperformed for a decade or more.
Continued in article
Department of Labor (DOL) ---
http://en.wikipedia.org/wiki/United_States_Department_of_Labor
"EBSA
Cracks Down on Retirement Plan Advisors:
Advisors take heed: The DOL arm that
rides herd over retirement plans is
ramping up its enforcement efforts," by
Melanie Waddell, AdvisorOne, March 26,
2012 ---
http://www.advisorone.com/2012/03/26/ebsa-cracks-down-on-retirement-plan-advisors?t=legal-compliance
Prominent retirement planning
officials are warning advisors to
make sure that the retirement plans
they advise are compliant with
Department of Labor rules, as the
DOL’s regulatory arm responsible for
policing these plans is cracking
down.
So far this year, the DOL’s Employee
Benefits Security Administration (EBSA)
has significantly raised its
enforcement efforts in what Andy
Larson, director of the Retirement
Learning Center, says should serve
as a wake-up call to advisors who
advise retirement plans and plan
sponsors.
In 2011, EBSA said it had closed
3,472 civil cases and obtained
monetary results of nearly $1.39
billion. EBSA also closed 302
criminal cases that resulted in 129
individuals being indicted and 75
cases being closed with guilty pleas
or convictions. DOL also wants to
increase the number of its
enforcement personnel from 913 to
1,003 this year.
Larson says those EBSA enforcement
numbers are “astonishing” and warns
that many advisors are surprisingly
still unaware that the DOL has
jurisdiction over them.
What’s the biggest area EBSA is
zeroing in on? Fiduciary negligence.
EBSA is “seeing very high levels of
non-compliance with fiduciary”
duties. When the EBSA releases its
reproposed fiduciary rule in the
first half of this year, the rule
“will affect advisors and their
fiduciary role,” not plan sponsors,
Larson says.
In light of this, Larson said,
advisors should ensure they have a
“strong documentable fiduciary
process.”
As Larson notes, since the Employee
Retirement Income Security Act (ERISA)
was put into place, DOL and the
Internal Revenue Service’s Employee
Plans Unit have had joint authority
“to ride herd” over retirement
plans. But service providers have
gotten accustomed to the IRS taking
the lead in enforcement actions, and
have failed to notice over the last
two years that the EBSA “is showing
up through the unlocked back door
and finding problems,” Larson says.
Because the IRS has been the primary
enforcer of ERISA rules, “service
providers have developed their
models to include mechanisms with
IRS requirements,” but may have
failed to include “DOL-type
protections in their service
models,” Larson says.
Continued in article
Bob Jensen's helpers (not advice) for
personal finance ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
"The
Truth About Paying Down Your Mortgage
Early," Business Insider,
June 21, 2013 ---
http://www.businessinsider.com/paying-off-mortgage-with-leftover-money-2013-6
Jensen Comment
Much depends on what your intend to do
with the funds that you would otherwise
use to pay down part or all of your
mortgage. If it all goes to wine, women,
and casino gambling then pay down at
least part of your mortgage. If it goes
to buy gold coins then pay down your
mortgage (I'm against buy gold coins in
any circumstances since the transactions
costs on resale are so high). If
it goes for home improvements the answer
is uncertain and depends upon your
particular real estate market and how
much those improvements add to the
monetary and personal value of your
home.
Of
course your particular income, savings,
and tax situation trumps almost
everything.
I
have an enormous refinanced mortgage
that will not be paid off until I'm
nearly 100 years of age. My strategy is
to carry a jumbo mortgage for tax
purposes and invest in an insured
tax-exempt fund where the after-tax
returns of my annual tax-exempt cash
flow exceed the after-tax cash outflow
of my mortgage costs. Of course this is
not a good strategy for everyone because
there are risks in tax-exempt fund
values, and tax-exempt bonds are not
good inflation hedges. Old guys like me
don't worry so much about inflation.
Young investors should worry about
inflation.
What I'm saying is that your outlook on
investments and life change with the
seasons of your life. When I was young I
always purchased the highest price home
with the biggest mortgage that I could
possibly afford. When on the faculty at
the University of Maine in the 1970s
I had a big and beautiful house in town
plus a cottage on 12 acres of ocean
front. In those days real estate values
just kept going up and up and up.
Two things have changed in my life. One
is that I'm no longer young with worries
about inflation and home real estate
values. My children will inherit enough
to a point that I'm not worried about
inflation or the value of my home over
the next 20 years --- Ka Sara Sara!
The other thing that has changed in my
lifetime is the real estate market. Up
in the mountains where I now live
expensive property is just not selling.
The market is also limited for other
types of property since northern New
England is in an economic and population
growth slump. Also the market for second
(vacation) homes is changing --- in part
due to higher risk of losing money on
these investments. I sold an Iowa farm a
few years ago. This is a totally
different type of investment where
values have been rising in large measure
because of the corn ethanol disaster for
consumers. Today, however, I think Iowa
farm land is a better investment for
farmers who actually drive the tractors
on Iowa farm land relative to far away
landlords with no intent to farm the
land themselves. Having said that, farm
land is a pretty good long-term
inflation hedge for investors not
needing much interim cash flow. At the
moment Iowa farm land may be too high
priced. Who really knows? Nobody!
My
point is that both your economic and
personal situation changes with seasons
of life and states of the economy and
tax reforms that might finally get
enacted. Advice is cheap and possibly
misleading. It's best to study your
particular situation to a point where
you can advise yourself.
Bob Jensen's personal finance
helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Individual Retirement Account (IRA) ---
http://en.wikipedia.org/wiki/Individual_retirement_account
There are several types of IRA:
-
Traditional IRA –
contributions are often
tax-deductible (often simplified
as “money is deposited before
tax” or “contributions are made
with pre-tax assets”), all
transactions and earnings within
the IRA have no tax impact, and
withdrawals at retirement are
taxed as income (except for
those portions of the withdrawal
corresponding to contributions
that were not deducted).
Depending upon the nature of the
contribution, a traditional IRA
may be referred to as a
“deductible IRA” or a
“non-deductible IRA.” It was
introduced with the Tax Reform
Act (TRA) of 1986.
-
Roth IRA –
contributions are made with
after-tax assets, all
transactions within the IRA have
no tax impact, and withdrawals
are usually tax-free. Named for
Senator
William V. Roth, Jr..
The Roth
IRA was introduced as part of
the Taxpayer Relief Act of 1997.
-
SEP IRA –
a
provision that allows an
employer (typically a small
business or self-employed
individual) to make retirement
plan contributions into a
Traditional IRA established in
the employee’s name, instead of
to a pension fund in the
company's name.
-
SIMPLE IRA –
a Savings Incentive Match Plan
for Employees that requires
employer matching contributions
to the plan whenever an employee
makes a contribution. The plan
is similar to a
401(k)
plan, but with lower
contribution limits and simpler
(and thus less costly)
administration. Although it is
termed an IRA, it is treated
separately.
-
Self-Directed IRA –
a
self-directed IRA that permits
the account holder to make
investments on behalf of the
retirement plan.
There are two other subtypes of IRA,
named Rollover IRA and Conduit IRA,
that are viewed by some as obsolete
under current tax law (their
functions have been subsumed by the
Traditional IRA); but this tax law
is set to expire unless extended.
However, some individuals still
maintain these arrangements in order
to keep track of the source of these
assets. One key reason is that some
qualified plans will accept
rollovers from IRAs only if they are
conduit/rollover IRAs.
What was
formerly known as an Educational IRA
is now called a
Coverdell Education Savings Account.
Starting with
the
Economic Growth and Tax Relief
Reconciliation Act of 2001
(EGTRRA), many of the restrictions
of what type of funds could be
rolled into an IRA and what type of
plans IRA funds could be rolled into
were significantly relaxed.
Additional acts have further relaxed
similar restrictions. Essentially,
most retirement plans can be rolled
into an IRA after meeting certain
criteria, and most retirement plans
can accept funds from an IRA. An
example of an exception is a
non-governmental
457 plan
which cannot be rolled into anything
but another non-governmental 457
plan.
The tax treatment of the above types
of IRAs except for Roth IRAs are
substantially similar, particularly
for rules regarding distributions.
SEP IRAs and SIMPLE IRAs also have
additional rules similar to those
for qualified plans governing how
contributions can and must be made
and what employees are qualified to
participate.
"Should
You Contribute to a Non-Deductible IRA?"
by Laura Adams, Money Girl,
February 12, 2013 ---
http://moneygirl.quickanddirtytips.com/what-is-a-non-deductible-ira.aspx
Bob Jensen's personal finance helpers
---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
"Do
Gold ETFs Really Move on Inflation
Expectations?" by John Spence,
ETF Trends, Junw 15, 2012 ---
http://www.etftrends.com/2012/06/do-gold-etfs-really-move-on-inflation-expectations/
Thank you Jim Mahar for the heads up.
Gold ETFs are often described as an
inflation hedge but recent academic
research suggests the precious metal
is more dependent on emerging market
demand, particularly from central
banks that hold less gold than their
counterparts in developed countries.
“Assuming that
gold moved in lockstep with the CPI,
the implied price would be about
$780 an ounce, according to Duke
University Professor Campbell R.
Harvey and his collaborator, Claude
B. Erb,”
Bloomberg News
reports.
Gold is
trading back above $1,600 an ounce
as traders speculate on the odds of
further monetary easing before next
week’s Federal Reserve meeting.
[Gold ETFs Eye Fed, Europe]
Since the gold bull market started
in about 2001, prices have risen
more than sevenfold.
“If gold is an inflation hedge, then
on average its real return should be
zero,” Erb and Harvey wrote,
according to the Bloomberg report.
Instead, returns from 2000 through
March of this year averaged 13% a
year on an inflation-adjusted basis.
Gold ETFs such
as
SPDR Gold
Shares (NYSEArca:
GLD),
iShares Gold Trust (NYSEArca:
IAU)
and
ETFS Physical Swiss Gold Shares (NYSEArca:
SGOL)
have likely fueled the metal’s rise
since they have made it easier for
more investors to buy gold.
“Global ETF
investor positions have continued to
trend up in both gold and silver,
reflecting the fact that long term
price supports such as negative real
interest rates, currency debasement
and sovereign/financial sector
default risk, and rising emerging
market/central bank demand remain
embedded in the 2012 outlook,” ETF
Securities said in a report earlier
this year.
[Measuring the Impact of Gold ETFs]
Harvey and Erb wrote that emerging
markets can support gold because the
precious metal represents a smaller
part of central bank reserves than
developed nations.
Foreign
central banks are “one of the more
intriguing sources of incremental
demand for gold,” says ConvergEx
Group strategist Nicholas Colas.
[Strategist: Why Gold ETFs Still
Make Sense]
“Among emerging economies, for
example, central banks are actively
buying gold to add to their
reserves. The trend is most
noticeable in Russia and India, but
increasingly in China as well. Press
accounts placed China’s net gold
purchases in 2011 at over 200 tons,
doubling its position in one year,”
he said in a recent report.
“And gold is clearly playing a role
at the central bank level in these
countries’ efforts to hedge such
price increases,” Colas noted.
“There is a popular saying on Wall
Street – ‘Don’t fight the Fed.’ Why
fight the Chinese, Russian and
Indian central banks on gold? Like
the Fed, they have much deeper
pockets than you.”
See Chart
Continued in article
Planning for the Bad as Well as the Good
in Retirement
"CPAs
Stress the Importance of Long-Term Care,"
AICPA, August 2012 ---
http://blog.aicpa.org/2012/08/cpas-stress-the-importance-of-long-term-care.html
Jensen Comment
Note that Medicare does not pay for
long-term care even though it does pay
for short-term crisis moments that
qualify for admission to a hospital. The
largest single Medicare expenditure by
far is for the hospital costs of dying,
but between the stroke and dying
hospital periods that are covered by
Medicare can be months and even years of
long-term care not covered.
I
learned at the 2012 AAA Annual Meetings
that a really close former friend and
colleague has been paying out over
$150,000 per year for 24/7 home nursing
care for a number of years. Because this
former accounting professor can afford
such level of care, it's not been
necessary to be admitted into a lower
costing nursing care facility. But such
nursing care facilities are still very
expensive for very long-term care.
A
friend committed suicide about three
years ago in Manchester, New Hampshire.
We were close years ago when we were
both masters degree students at the
University of Denver. Interestingly, he
had an expensive paid-up insurance
policy for long-term nursing care.
Sherman never married and had no family
left whatsoever. My guess is that when
his health and quality of life started
going downhill he just did not want to
waste away in a nursing home even though
he had premium insurance coverage for
long-term care.
By the way I am not advising for or
against long-term care insurance.
Such insurance is quite expensive and
increases greatly in cost with age. I
did not conduct research for this email
message, but I think that the odds are
still relatively low for incurring very
expensive long-term care. But "odds" are
computed on the basis of a large
population of elderly people. The odds
for a given individual can be quite
different. The mother-in-law of one of
my cousins back in Iowa has been in a
nursing home for over ten years in a
small Iowa town. In no way could she
have paid for such care all these years
without having had such insurance.
Hence, I do not give advice regarding
whether to buy or not buy long-term care
insurance. I did not buy such insurance.
Keep in mind that most long-term care
insurance policies do not cover all
long-term care costs. Some policies only
pay a pittance of these costs.
My
point that all retirees are subject to
the financial risks of long-term care.
These should be factored into dreams of
that condo on a golf course or that
small hobby farm with occasional luxury
cruises.
No
Fooling: Try This One Out With Students
(adding sensitivity analysis with
interest rates and inflation)
"Slow Compounding," by Floyd
Norris, The New York Times, April
1, 2011 ---
http://norris.blogs.nytimes.com/2011/04/01/slow-compounding/
American Express has a full-page ad
in today’s Times offering a savings
account yielding 1.15 percent.
These days that is a good rate, a
fact the people of my generation
find astonishing. Such amazingly low
rates cause great anxiety for those
who saved money in the past and now
find it yields so little.
I did a little arithmetic. My son is
an 18-year-old college freshman. If
he puts $100 into such an account
now, and rates remain constant, he
will have doubled his money in time
for his 79th birthday party.
Of course, if you are investing for
a child in kindergarten, there is
still hope. A $100 investment today
would double about the time he or
she goes on Medicare.
Bob Jensen's personal finance helpers
are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
The sad part about going into business
apart from writing books is that having
such a huge vested interest in that
business creates moral hazard in terms
of independence as on of the leading
personal finance commentators in the
world. The champion of the poor and
troubled may be trying to increase her
1% at the expense of the poor and
troubled.
Suze Orman ---
http://en.wikipedia.org/wiki/Suze_Orman
"Suze
Orman, Debit-Card Dealer: The
money guru introduces her first
financial product—and vexes some fans,"
by Karen Weise, Bloomberg Business Week,
January 19, 2012 ---
http://www.businessweek.com/magazine/suze-orman-debitcard-dealer-01182012.html
“I love you!” a woman yells as
personal finance guru Suze Orman
enters the drab conference room at a
Barnes & Noble (BKS) in suburban New
Jersey. Fans cheer and clap while a
man in the front row tears up from
excitement. Orman is here to preach
the tough-love brand of financial
advice that she’s been peddling for
more than a decade through nine
bestselling books, a highly rated
CNBC show, and regular appearances
on the old Oprah Winfrey Show. “You
have got to be the masters of your
own financial future,” she tells the
200-strong crowd. While the event
coincides with a new paperback
edition of her 10th book, The Money
Class, that’s not the main focus of
her talk. “You need more than
books,” she says. “Now you need the
tools.”
Orman has a particular tool in mind.
Just a few days earlier she
introduced her first financial
product: a prepaid debit card
emblazoned with her name. She sees
her Approved Card as an alternative
way for people who are fed up
with—or don’t have—traditional
checking accounts and credit cards
to manage their cash. And if the
most ambitious part of her plan
succeeds, the card may eventually
help users improve their credit
scores.
Orman’s Approved Card, issued by
Wilmington (Del.)-based Bancorp Bank
(TBBK), is in part designed to play
the role of pestering mom. The
basics are simple: People use
electronic transfers or cash to load
money onto their cards, then use
them like regular debit cards,
buying groceries or shopping online.
The Orman touch comes in such
features as automatic text message
alerts sent to mobile phones that
note the balance remaining on the
card after each purchase. The card’s
website has Orman issuing such
sharply worded reminders as, “Before
you make a purchase, you’d better be
able to afford it—do you hear me?!”
Prepaid cards are the
fastest-growing payment method,
Federal Reserve data show. In 2010
people used them for $65 billion in
transactions, compared with $48
billion in 2009, the industry
newsletter Nilson Report says. Part
of the cards’ appeal is that you
can’t get into debt with them. “I
think it’s a good idea to have a
prepaid card rather than going out
willy-nilly with a credit card,”
says Glinda Kidd at the book
signing.
Still, prepaid cards often come
loaded with fees—and Orman’s is no
exception. It has a standard $3
monthly charge. While there’s no
cost to reload the card with direct
deposits or automatic transfers from
a checking account, people must pay
up to $4.95 to put cash on the card
at Western Union (WU) or MoneyGram
(MGI) locations. And if they load
with cash rather than
electronically, all ATM withdrawals
cost $2. One free call to a customer
service rep is included each month;
extra calls are $2 each.
“What people don’t understand is the
cost to do business,” says Orman in
an interview. “If I could have given
this to you for free, I would have.”
Orman, who says she invested $1
million in the venture, declines to
discuss how much money she might
make from it. And she vows to train
customers to keep their costs down.
In videos on the card’s website, she
explains the fees, warning that
people who load their cards
electronically can get cash from one
of the 35,000 ATMs in the Allpoint
network for free but will incur a $2
charge for using other ATMs—plus
whatever fee the ATM operator
imposes. “Why would you want to
waste money like that?” she says in
the video. “Don’t be lazy, and go to
an Allpoint ATM.”
Orman says if she finds people are
incurring fees to put cash on the
card, only to spend another $2 to
get cash at an ATM, she will ask
them to turn in their plastic. If
you’re going to squander money that
way, “just keep it in cash! You
don’t need the damn card,” she tells
the audience at the book signing.
Michael Collins, an assistant
professor at the University of
Wisconsin who studies the financial
decision-making of low-income
families, says people will
eventually figure out the costs of
any product. “The question is how
long will it take” and how much in
fees they will have racked up by
then, he says. Collins adds that if
Orman’s messages help people control
their spending impulses, the card
could be beneficial: “Anything that
gets people to think harder about
their financial security and take
some responsibility is a good
thing.”
Some personal finance bloggers have
complained about the fees and
charged that Orman is using her
influence to bilk her fans. On
Twitter, the Blog Finanza website
said: “You are taking your authority
figure to make a $$ from your
audience. #DENIED”—echoing a
catchphrase from Orman’s TV show.
Others, such as MSNBC.com consumer
finance columnist Herb Weisbaum,
said many people would be better
served by building their credit
immediately with a secured credit
card.
Orman dismisses the criticisms,
saying the card reflects her
understanding of people’s financial
habits and needs. “I am the personal
financial expert of the world,” she
says. “I know what I am talking
about.” Publicly, Orman lashed out
on Twitter against the naysayers,
calling them “small thinkers,”
“idiots,” and “Suze haters.” After
New York Times personal finance
columnist Ron Lieber and others
protested the harsh words, she
issued a blanket apology: “For
anyone I called an idiot, I too am
sorry.”
Continued in article
"Does Suze Orman's
Prepaid Debit Card Make Sense for You?"
by Sarah Gilbert, Get Rich Slowly,
January 17, 2012 ---
http://www.getrichslowly.org/blog/2012/01/17/does-suze-ormans-prepaid-debit-card-make-sense-for-you/?WT.qs_osrc=fxb-48064510
Suze Orman
is famous for her personal,
easy-to-digest, and friendly
personal finance advice. Many of us
less famous (far less
famous, in the case of this writer)
finance writers admire her general
approach, which boils down to “spend
less than you earn.” Who can argue
with that? So imagine my amazement
at the news this week that Suze will
be
offering a branded prepaid debit
card.
Prepaid debit cards have a
star-crossed reputation
You know about branded prepaid debit
cards, but they're usually not
connected with individuals known for
their sensible finance advice. Think
Russell Simmons.
Think
the Kardashians.
See? Sample
words and phrases from our
collective wisdom on those topics
include “skeptical” and
“reprehensible” and “urge to scream”
and “hit cash-strapped consumers
over the head with nickel-and-dime
charges.”
Suze Orman is famous for her
personal, easy-to-digest, and
friendly personal finance advice.
Many of us less famous (far less
famous, in the case of this writer)
finance writers admire her general
approach, which boils down to “spend
less than you earn.” Who can argue
with that? So imagine my amazement
at the news this week that Suze will
be offering a branded prepaid debit
card.
Prepaid debit cards have a
star-crossed reputation You know
about branded prepaid debit cards,
but they're usually not connected
with individuals known for their
sensible finance advice. Think
Russell Simmons. Think the
Kardashians. See? Sample words and
phrases from our collective wisdom
on those topics include “skeptical”
and “reprehensible” and “urge to
scream” and “hit cash-strapped
consumers over the head with
nickel-and-dime charges.”
The biggest problems with prepaid
debit cards are, really, threefold:
While they are cards that are
available to consumers with bad
credit, they don't help consumers
build credit, though they are
advertised as doing so (any help
would be mild at best - the
reporting they do is only to smaller
credit reporting agencies, not the
“big three” that man the velvet rope
for most consumer debt in America).
They're punishingly expensive and
seem more directed toward
association with the personality
branding the card than any financial
benefit. Russell's “Rush” Card costs
between $4 and $15 upfront, with $10
monthly fees and $1 per-transaction
fees. They're accused of using
celebrities to take advantage of
both the hopes and difficult
situations of the “unbanked,”
mostly-lower-class, often minority
consumers whose financial situation
is so bad that banks won't take the
risk of giving them checking
accounts.
Suze Orman wants to make a
difference (but, is it a fool's
errand?) Orman has a different idea.
She, too, wants to convince the
unbanked to use her prepaid debit
card, but she wants to charge less.
Her “Approved Card” is far cheaper
than Rush or the K thingy - only $3
to purchase the card and a $3
monthly fee. ATM transactions from
the Allpoint network (found in
7-Eleven, Costco, Kroger, CVS, and
Walgreens) are $2 per withdrawal,
and point of sale transactions, such
as purchases at the grocery store or
coffee shop or online, are free.
Balance inquiries and some declined
transactions are $1 , but it's free
to be declined at the register for a
regular PIN/signature transaction.
Many of these transactions,
especially ATM withdrawals, are free
for 30 days with a direct deposit or
bank transfer into the Approved Card
account, making them a great product
for customers with some sort of
automatically-deposited income
(even, for instance, unemployment).
Notably, electronic debit bill
paying is free. Many competing
products charge for this service,
from $1 to $3 per transaction, and
it's the service that customers
without a regular bank account need.
Often, discounts and special deals
are available to customers who allow
vendors to debit their account each
month.
The great credit score kerfuffle
The concept that sells many prepaid
debit cards - the
quasi-justification for how
expensive they are - is that they
might help in the quest to raise a
credit score. If a credit score is
low enough so that a mainstream bank
isn't part of your personal finance
portfolio, can a prepaid debit card
even help? Probably not.
The problem that Suze Orman has
mentioned in public statements about
the Approved Card is that credit
bureaus, beyond even knowing about
the transactions made by the
millions of unbanked consumers,
don't care about sensible use of
money. They just care about sensible
use of credit. A New York Times
piece quotes Orman as saying, “There
is something radically wrong here.
We are rewarding people for having
credit and punishing people who pay
in cash. I want to change that
paradigm.”
Wanting to change credit score
calculation is easy. Changing is
hard.
Orman has done the near-impossible
and convinced TransUnion, one of the
big three credit bureaus, to collect
the data about spending habits from
her customers. But what that will do
to credit scores is another thing
entirely. The answer, probably, is
nothing.
The problem
that Suze Orman has mentioned in
public statements about the Approved
Card is that credit bureaus, beyond
even knowing about the transactions
made by the millions of unbanked
consumers, don't care about sensible
use of money. They just care about
sensible use of credit. A
New York Times piece
quotes Orman
as saying, “There is something
radically wrong here. We are
rewarding people for having credit
and punishing people who pay in
cash. I want to change that
paradigm.”
Wanting to change credit score
calculation is easy. Changing is
hard.
Orman has done the near-impossible
and convinced TransUnion, one of the
big three credit bureaus, to collect
the data about spending habits from
her customers. But what that will do
to
credit scores is
another thing entirely. The answer,
probably, is nothing.
The problem is
that TransUnion has only been
persuaded to evaluate the data Orman
will collect with her Approved Card;
it has not promised to include that
in credit reports nor in the
calculation of scores. If, after two
years, it finds the data meaningful,
it's still unlikely to have much of
an effect on the resultant
calculations. Responsible use of a
prepaid debit card, after all,
hasn't had much impact on the
financial institutions that sponsor
the card - in this case, Orman's own
company - so the patterns of data
don't have much meaning.
What kind of debit card use could
demonstrate the sort of behavior
creditors want to see, such as:
-
On-time
delivery of minimum
payments
-
A history of purchasing
high-value assets and then
paying them off quickly
-
Regular income and a comfortable
ratio of debt-to-income
These all can be shown far more
reliably through existing reporting.
A consumer who pays rent on time
each month in cash won't differ, to
the eyes of TransUnion, from a
consumer who pays rent on time each
month by automatic debit from her
Approved Card. Similarly, failing to
overdraw an Approved Card account
(that is impossible to overdraw
from, except perhaps for a few $1/$2
ATM transaction declined fees) is
very different from failing to
overdraw a bank account.
Why
would you use a prepaid debit card?
There are two groups of people I can
see benefiting from using a prepaid
debit card, as well as one group I
would caution to avoid it. All of
them could achieve higher credit
scores, but not in the way you
think. Let me explain.
Continued in article
Jensen Comment
The sad part about going into business
apart from writing books is that having
such a huge vested interest in that
business creates moral hazard in terms
of independence as on of the leading
personal finance commentators in the
world. The champion of the poor and
troubled may be trying to increase her
1% at the expense of the poor and
troubled.
Bob Jensen's personal finance helpers
are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Financial Education in the Math Classroom ---
http://mathforum.org/fe/
A Government Website for Helpers
in Personal Finance MyMoney.gov is the U.S. government's
website dedicated to teaching all Americans the basics about
financial education. Whether you are planning to buy a home,
balancing your checkbook, or investing in your 401k, the resources
on MyMoney.gov can help you do it better. Throughout the site, you
will find important information from 20 federal agencies government
wide. My Money.gov ---
http://www.mymoney.gov/
PBS Television will now answer your personal finance questions
---
http://www.pbs.org/newshour/insider/business/jan-june09/pocketchange_05-05.html
From CNN: Clark Howard's Informative Advice About Shopping,
Financial Planning, and Warnings About Scams ---
http://www.cnn.com/CNN/Programs/clark.howard/?iref=allsearch
Bob Jensen's warnings about scams
---
http://faculty.trinity.edu/rjensen/FraudReporting.htm
Bob Jensen's shopping helpers ---
http://faculty.trinity.edu/rjensen/Bookbob3.htm
National Endowment for Financial
Education ---
http://www.nefe.org/
Mission
The mission of the National
Endowment for Financial Education is
to help individual Americans acquire
the knowledge and skills necessary
to take control of their financial
destiny. NEFE’s mission is grounded
in the belief that regardless of
background or income level,
financially informed individuals are
better able to:
-
Take control of their
circumstances,
-
Improve their quality of life,
and
-
Ensure a stable future for
themselves and their families.
Guiding Principles
NEFE’s guiding
principles are stated in eight
initiatives.
These
initiatives:
-
Describe how NEFE achieves its
mission, and
-
Outline the goals and standards
that guide the foundation’s
activities.
Every project
or program undertaken by NEFE must
fit within the scope of at least one
initiative.
NEFE accomplishes its mission
primarily by
partnering with
other organizations to:
-
Provide practical, reliable, and
unbiased financial education to
members of the public.
-
Accomplish research in the field
of financial literacy
education.
-
Create demand for financial
education.
NEFE’s activities place special
emphasis on those who face financial
challenges that are not being
addressed by others. Among our
target audiences are:
-
Youth,
-
Low-income individuals and
families, and
-
People in difficult or unusual
life circumstances.
NEFE’s partnerships and the
foundation’s own efforts result in a
wide range of free and low-cost
activities and materials,
including:
New activities
are covered in each issue of the
foundation’s newsletter,
NEFE Digest, and in the
New at NEFE section.
Organizational Structure
The National
Endowment for Financial Education is
a nonprofit 501(c)(3) foundation
governed by a volunteer
Board of Trustees
and led by
president and CEO
Ted Beck.
A staff of fewer than 25 individuals
guides NEFE’s public-service work at
its headquarters in Denver,
Colorado. To learn more, visit the
History section
of this Web
site.
NEFE organizes
its activities into four
action areas, which flow
from the foundation’s mission and
initiatives.
NEFE defines its action areas as:
-
Education Programs.
Although not restricted to a
particular age group, the
Education Programs area has been
oriented primarily to providing
financial planning information
to youth, including NEFE’s
longest-standing public service
effort, the
NEFE High School Financial
Planning Program® (HSFPP).
-
Strategic
Programs and Alliances. This
action area works to help
Americans improve the quality of
their lives through financial
education provided in
cooperation
with other nonprofit
organizations and foundations,
and occasional corporate
sponsors.
-
Multimedia Access. This
action area represents NEFE’s
commitment to sharing its
expertise in financial planning
education with all those who
might benefit from it, including
consumers,
educators,
and the
media.
-
Innovative Thinking.
The goal of this action area is
to inspire creative ideas and
new perspectives on personal
finance, to communicate them
broadly, and to assist in their
actualization where appropriate.
This action area supports
fellowships
programs,
grantmaking,
and
research and strategic
activities.
Video:
Interesting look at 8 common investment
mistakes that uses Big Brown (the horse,
not the delivery company). ---
http://financeprofessorblog.blogspot.com/2009/10/video-on-common-mistakes.html
Last
night's (October 7, 2009) PBS NewsHour
took a look at the bearish obsession du
jour, the commercial real estate market.
Real estate analyst Bob White took them
around to show some of the ugliest cases
out there. (via
Square Feet)
http://www.businessinsider.com/a-guided-tour-of-nyc-commercial-real-estate-wreckage-video-2009-10
TIAA-CREF has done a good job weathering
the latest economic recession
"TIAA-CREF and You," Chronicle
of Higher Education, October 4, 2011
---
http://chronicle.com/article/TIAA-CREFYou/129261/?sid=at&utm_source=at&utm_medium=en
. . .
To understand TIAA-CREF's offerings,
first understand what it is:
Whatever the prominence of the words
Teachers and College in its unpacked
acronym, TIAA-CREF is simply a giant
insurance company. Pennywise wrote
about TIAA-CREF once before, in a
column that appeared at the height
of the financial crisis entitled,
"Is TIAA-CREF Safe?" Personally, I
find that article has held up fairly
well and may be reassuring today, in
our renewed mood of uncertainty. New
readers might want to take a look at
it.
TIAA-CREF has weathered the Great
Recession well. Today the company
ranks 87th on the Fortune 500 list,
with $32-billion in revenues and
$1.4-billion in annual profits. All
four ratings agencies still give the
company the highest possible rating
for financial stability; at this
point, its ratings are better than
the federal government's. A leading
investing Web site calls the company
the strongest annuity insurer in the
United States.
As for your specific TIAA-CREF
investing options, your university's
human-resources department can
choose from a smorgasbord, so plans
will differ. Almost certainly your
college's plan has annuities at its
core. Those are, for the most part,
variable annuities, meaning their
value and rates of return fluctuate
along with financial markets,
functioning much like mutual funds
in the accumulation phase—the
stretch of life in which you amass
your holdings. Once you reach the
drawdown phase, however, those
vehicles offer the ability either to
take out your pile of money in a
lump sum or to annuitize it, meaning
convert it into a steady stream of
annual (hence the name "annuity")
income that will last the rest of
your life.
You may notice annuities getting bad
press from time to time because the
ones sold by many insurers come
wrapped in a lot of hidden fees and
are sold by advisers seeking
commissions. TIAA-CREF's annuities
are in a different category; they
are relatively low-cost, the
company's consultants get no
commissions, and the criticisms
don't really apply (one exception
noted at the end of this column).
Here's how not to invest
with TIAA-CREF: Don't—after looking
at the 10-year returns of the
different options—put your money
heavily into the ones that have
performed best. Ten years from now
something else may have outperformed
them. The funds that have done well
recently are probably the most
expensive right now, but nobody can
be sure.
Instead, consider your household
portfolio as a whole. Seek a
well-diversified mix of different
types of investments that rely on
returns from different sectors of
the economy. Understand how each
option functions and spread your
money around in proportions that
make sense for your relative sense
of risk.
Your plan is likely to include the
following:
TIAA Traditional Annuity.
From your point of view, this
account works a bit like a bank
certificate of deposit with a very
generous interest rate. TIAA-CREF
guarantees that any money you put in
will be returned. The company then
pays a specific rate of interest
(currently 3.75 percent) on all new
money deposited, a rate adjusted
periodically. (The overall rate of
return for the past 10 years was
5.62 percent). Because TIAA-CREF
manages the underlying pool of money
by investing mostly in bonds and
related securities, rates in the
coming years will probably be fairly
low, but your contributions are
contractually guaranteed.
This is an excellent investment for
those who react very badly to market
drops. However, while you do not
face market risk, you do face
individual company risk. If
TIAA-CREF went bankrupt, its
guarantee would mean nothing. That's
why the firm's profitability and
stability are crucial.
Note: To guarantee your principal
plus a rate of interest, TIAA-CREF
puts some fairly strong restrictions
on clients' ability to transfer
money in and out of this annuity.
Don't commit money to TIAA
Traditional unless you are content
to let it sit until you retire. You
can get it out, but it will be
difficult.
Tip: Concentrate your TIAA
Traditional holdings in your main
403(b) account, since a much lower
rate of interest (currently 0.75
percent less) will be paid on it in
your Supplemental Retirement Account
(SRA), if you have one.
TIAA Real Estate Variable
Annuity. The funds in this
distinctive offering are invested
directly in real estate (office
buildings, malls, industrial parks,
and so forth). Buy in, and you get
the perks of being a property mogul
and landlord, without all the
hassles.
CREF Variable Annuities.
These function a great deal like
regular mutual funds. There are five
stock-market options: Global, Stock,
Equity Index, Growth, and Social
Choice. Global and Stock both invest
in world stock markets, including
U.S. and international ones. Equity
Index and Growth are solely U.S.
stock-market funds. Social Choice
screens for certain ethical and
political criteria. Then there are
three options that apply to the more
stable, less risky part of your
portfolio: Bond, Inflation-Linked
Bond, and Money Market.
It may be that your university plan
also offers, beyond the above
annuities, TIAA-CREF's vast array of
mutual funds, which come in almost
infinite variations, including
LifeCycle funds (all-in-one,
no-brainer options for those who
want to put things on autopilot) or
highly specific funds focusing on
specific sectors of the stock
market, such as small-cap companies.
The precise
mix that is right for you depends on
your risk tolerance and time frame.
There are decent models on Page 12
of this
brochure.
No need to make it complex, though.
A pretty good holding could be
amassed in just TIAA Traditional (20
percent); TIAA Real Estate (10
percent); one of the stock-market
annuities, perhaps Equity Index
since it costs you the least, or
Global since it has international
diversification to offer (60
percent); and the inflation-adjusted
bond option (10 percent). Reduce the
equities portion and increase the
bond if you are skittish or near
retirement.
Remember that the current market
mayhem may mean you will be buying
low. Don't let it scare you away
from stocks, even if, in the short
term, you see some declines.
Continued in article
Making Home Affordable ---
http://www.makinghomeaffordable.gov/pages/default.aspx
Making Home Affordable is a key part
of the Obama Administration's effort
to help homeowners avoid
foreclosure. If you are struggling
with your monthly mortgage payments
or have already missed a payment,
now is the time to take action.
Start today by learning more about
the options available to you through
MHA
Help for Homeowners Facing
Foreclosure
Help for Homeowners Struggling
With Mortgage Payments
Help for Homeowners Trying to
Avoid Mortgage Troubles
Attend an MHA event in
your area
Ray Williams ---
http://en.wikipedia.org/wiki/Ray_Williams_(basketball)
"Nobody wnats you when you're down and
out" ---
http://www.youtube.com/watch?v=MsrA2fMn0sk&feature=fvst
A Sad, Sad Case That Might Be Used
When Teaching Personal Finance:
Another Joe Lewis Example
"Desperate times: Ex-Celtic
Williams, once a top scorer, is now
looking for an assist," by Bob Hohler,
Boston Globe, July 2, 2010 ---
http://www.boston.com/sports/basketball/celtics/articles/2010/07/02/desperate_times/
Every night at bedtime, former
Celtic Ray Williams locks the doors
of his home: a broken-down 1992
Buick, rusting on a back street
where he ran out of everything.
The 10-year NBA veteran formerly
known as “Sugar Ray’’ leans back in
the driver’s seat, drapes his legs
over the center console, and rests
his head on a pillow of tattered
towels. He tunes his boom box to
gospel music, closes his eyes, and
wonders.
Williams, a generation removed from
staying in first-class hotels with
Larry Bird and Co. in their drive to
the 1985 NBA Finals, mostly wonders
how much more he can bear. He is not
new to poverty, illness,
homelessness. Or quiet desperation.
In recent weeks, he has lived on
bread and water.
“They say God won’t give you more
than you can handle,’’ Williams said
in his roadside sedan. “But this is
wearing me out.’’
A former top-10 NBA draft pick who
once scored 52 points in a game,
Williams is a face of big-time
basketball’s underclass. As the NBA
employs players whose average annual
salaries top $5 million, Williams is
among scores of retired players for
whom the good life vanished not long
after the final whistle.
Dozens of NBA retirees, including
Williams and his brother, Gus, a
two-time All-Star, have sought
bankruptcy protection.
“Ray is like many players who
invested so much of their lives in
basketball,’’ said Mike Glenn, who
played 10 years in the NBA,
including three with Williams and
the New York Knicks. “When the
dividends stopped coming, the
problems started escalating. It’s a
cold reality.’’
Williams, 55 and diabetic, wants the
titans of today’s NBA to help take
care of him and other retirees who
have plenty of time to watch games
but no televisions to do so. He
needs food, shelter, cash for car
repairs, and a job, and he believes
the multibillion-dollar league and
its players should treat him as if
he were a teammate in distress.
One thing Williams especially wants
them to know: Unlike many troubled
ex-players, he has never fallen prey
to drugs, alcohol, or gambling.
“When I played the game, they always
talked about loyalty to the team,’’
Williams said. “Well, where’s the
loyalty and compassion for
ex-players who are hurting? We
opened the door for these guys whose
salaries are through the roof.’’
Unfortunately for Williams, the
NBA-related organizations best
suited to help him have closed their
checkbooks to him. The NBA Legends
Foundation, which awarded him grants
totaling more than $10,000 in 1996
and 2004, denied his recent request
for help. So did the NBA Retired
Players Association, which in the
past year gave him two grants
totaling $2,000.
Continued in article
"A Home Is a Lousy Investment: Today's young people would be foolish
to imitate their parents and view ownership as the cornerstone of personal
finance," by Robert Bridges, The Wall Street Journal, July 11, 2011
---
http://online.wsj.com/article/SB10001424052702304259304576375323652341888.html?mod=djemEditorialPage_t
At the risk of heaping more misery on the
struggling residential property market, an analysis of home-price and
ownership data for the last 30 years in California—the Golden State with
notoriously golden property prices—indicates that the average single family
house has never been a particularly stellar investment.
In a society increasingly concerned with providing
for retirement security and housing affordability, this finding has large
implications. It means that we have put excessive emphasis on owner-occupied
housing for social objectives, mistakenly relied on homebuilding for
economic stimulus, and fostered misconceptions about homeownership and
financial independence. We've diverted capital from more productive
investments and misallocated scarce public resources.
Between 1980 and 2010, the value of a median-price,
single-family house in California rose by an average of 3.6% per year—to
$296,820 from $99,550, according to data from the California Association of
Realtors, Freddie Mac and the U.S. Census. Even if that house was sold at
the most recent market peak in 2007, the average annual price growth was
just 6.61%.
So a dollar used to purchase a median-price,
single-family California home in 1980 would have grown to $5.63 in 2007, and
to $2.98 in 2010. The same dollar invested in the Dow Jones Industrial Index
would have been worth $14.41 in 2007, and $11.49 in 2010.
Insert Graph
Here's another way of looking at the situation. If
a disciplined investor who might have considered purchasing that
median-price house in 1980 had opted instead to invest the 20% down payment
of $19,910 and the normal homeownership expenses (above the cost of renting)
over the years in the Dow Jones Industrial Index, the value of his portfolio
in 2010 would have been $1,800,016. The stocks would have been worth more
than the house by $1,503,196. If the analysis is based on 2007, the stock
portfolio would have been worth $2,186,120, exceeding the house value by
$1,625,850.
In light of this lackluster investment performance,
and in the aftermath of the recent housing-market collapse, why is there
such rapt attention to the revival of the homebuilding industry and
residential property markets? The answer is that for policy makers whose
survival depends on economic recovery, few activities have such direct,
intense and immediate positive economic impact as new home construction.
Continued in article
Jensen Comment
There's a huge difference between owning rental property versus owning a
residence for yourself, although dealing with tenants is sometimes a real pain
in the tail. If you're handy with repairing rental property located in an area
where there's huge demand (such as near a college campus or medical center), the
returns can be quite high for property purchased when the real estate market is
on the down side and mortgage rates were low --- such as in 2011. There are also
added tax breaks such as deductions for repairs, insurance, and depreciation.
But on your personal residence the capital gains are no longer as attractive as
they were in the days of your ancestors. Plus Congress is debating whether to do
away with deductions for residence mortgages, although I've great faith in the
immense power of the banking and real estate lobbies.
Home ownership, until recently, was a
very good inflation hedge. The above
article tends to imply that
inflation-adjusted returns may not be so
great in the future unless you purchased
your home at a really low price in a
distressed market that shows signs of
relatively good recovery such as in
Texas versus California. Rural property
and vacation properties are not so hot
in terms of expected recovery. For
example, small towns in the farming
regions of the mid-west, like my home
state of Iowa, have dismal chances of
recovery as factory farms drive off
small farmers and the rural towns small
farmers support. My grandfather's
well-maintained five bedroom house in
Swea City, Iowa recently sold for less
than $10,000. And over half of downtown
Swea City is boarded over with plywood.
I'm amazed that more owners have not
torched buildings just to collect the
insurance.
Anticipated fuel price increases will
affect real estate values. Property
values may decline for home owners now
located 30 or more miles from where most
of the jobs are located. On the other
side of the coin, properties closer to
work centers may have increasing returns
if they are in areas of good schools.
Dangerous and/or lousy schools always
hurt the values of real estate. Another
Hurricane Andrew might wipe out real
estate prices in South Florida due, in
part, to unaffordable hurricane
insurance.
Your biggest worry as a home owner
trying to sell these days is that no
serious buyer even wants to view the
property let alone make an offer unless
you are willing to sell at a huge loss.
The minister here in our Sugar Hill
Community Church had a high-value former
home in Grand Junction, Colorado. It
took over three years to even have a
potential buyer view the property. Many
owners are finding they cannot sell at
prices above the amortized balance on
their mortgages. Owners often simply
pack up and leave the keys with their
banker, thereby wiping out all the
equity built up in the home.
Of course there are various advantages and disadvantages of home ownership other
than investment prospects. On the plus side many people like me find joy in
taking care of a home and the land that surrounds the home --- more joy than we
would find if we only rented the property.
In some cases ownership is the only alternative for a quality home on a
long-term basis. For example, Stanford University provided on-campus land for
faculty housing where, on a campus lot leased cheaply for 99 years, faculty
could build their own houses under a condition that when they rent or sell these
houses it will be to somebody in the Stanford community (faculty or staff or
visiting scholars). It's usually possible for someone new to Stanford to rent a
professor's house on this campus land. But such rentals are likely only short
term for a year or two such that somebody new to Stanford who really wants to
live on campus for the long haul really has to buy a home and not rent. When I
was invited back to Stanford for two think-tank years, I rented a geology
professor's home for one year and an economics professor's home the second year.
These homes were both only a few blocks from where Stanford accounting
professors Chuck Horngren, Bill Beaver, and Joel Demski had built their campus
homes.
A drawback to home ownership in general, however, is that it's getting harder
and harder to sell a house without taking a beating financially unless the
property is purchased at very, very distressed prices. Some banks and towns are
selling foreclosed homes very cheap. For example, a friend up here in Sugar
Hill, NH recently purchased a foreclosed home at a third of its appraised value
for property taxes. The problem is that for property taxes, the tax appraiser
subsequently refused to lower the appraisal value down to the purchase price,
i.e., the property taxes remained relatively high on this foreclosed property
after it was resold at a 'bargain basement" price.. The tax assessor stated that
Sugar Hill will not lower the property tax because of a "bargain basement"
purchase price. Hence, buyers receiving good deals on purchase prices will not
necessarily receive similar good deals when the property tax bills are received
twice a year on this good deal purchase. Tax appraisal values may be much higher
than the transacted purchase prices if the the tax appraiser deems the purchase
prices as bargain basement prices on foreclosed properties.
Home Ownership is Never "Free" Even
When You Own Your Home Free and Clear of First and Second Mortgages
Put another way, if a buyer pays more than the tax appraisal value, the tax
appraisal value will be soon be raised for property tax purposes since
all transacted real estate prices must be reported to the taxing authorities.
But if the buyer pays less than the tax appraisal value, the tax appraisal value
will not be lowered for property tax purposes unless the property owner
is successful in a costly lawsuit in Superior Court. This means that most
new owners of Sugar Hill properties are paying property taxes at much higher
appraised values than what they can realistically expect if they sell those
properties in today's depressed real estate market. I think this is a fact of
life in most other parts of the United States at the moment. And if the
courts force property tax districts to set property tax appraisals at more
realistic real estate value estimates, then the property tax districts will just
set the tax rates at levels needed to support rising local, county, and school
district budgets.
Another huge ownership drawback is that in many states like New Hampshire,
property taxes have become the primary means of local town, county, and school
financing. Hence, property taxes are markedly rising on homes even if their
value is on the decline. Of course, renters of homes are indirectly paying the
property taxes on homes. But landlord tax breaks (such as for depreciation) can
be factored in to reduce somewhat increasing property taxes. Also renters often accept less spectacular houses to
live in knowing that these houses are not investments and that they are free to
relocate in a year or less with no transactions cost and trauma of trying to
find buyers for their rental homes.
The point here is that many, many home owners are having second thoughts
about ever again purchasing homes unless the homes can be purchased at
exceedingly low bargain basement prices to justify the relatively high and
ever-increasing annual property taxes due on those properties. Or there must be
some very unique attributes that makes the property attractive to buyers such as
golf course frontage, ocean frontage, lake frontage, mountain views, or a short
walking/bicycle distance to a Stanford University faculty office.
Aside from a home plus a rural farm I inherited in Iowa, I owned three houses
(one in Michigan, one in Maine, and one in Florida) during the era where home
ownership was a great investment with values rising about 10%- 20% each year on
average. I also owned one house in Texas in a later era where I lost 15% (even
more loss if I adjust for inflation) of my
24-year investment and breathed a great sigh of relief that the only serious
prospect (after ten months) to look at this big house (4,500 square feet and my last-ever swimming
pool)) made an offer. And I sold this San Antonio house in 2006 before the real
estate bubble burst!
I suspect I will also lose a substantial amount that I
invested in my present scenic and comfortable cottage. But, since I hope to
remain here until the day I die, I don't care so much about that loss ---
http://faculty.trinity.edu/rjensen/NHcottage/NHcottage.htm
In the our case, a home is far more than a financial investment even if it is
a 150-year old money pit ---
http://en.wikipedia.org/wiki/The_Money_Pit
July 11, 2011 reply from Hossein Nouri
Bob:
I think it depends on when you start your initial
investment date. I purchased $35,000 of mutual funds (10 different
categories) in 1996 and at present its value is about $42,000 (20% increase
or 1.33% a year). I also purchased a condo in 1999 for $85000 and at present
it is $200,000 (135% increase or about 10% a year). It also provides about
$6000 positive cash flow every year or about 7% of original cost. My
retirement since 1992 also is not doing much better than my mutual fund
investment.
So, my suggestion to all young people is to buy
property, but in good location. At least you have something tangible in hand
and not a piece of worthless paper which is manipulated by all sharks in the
Wall street.
Hossein Nouri
July 11, 2011 reply from David Fordham
Bob: I'm assuming the author is announcing a change
rather than trying to correct a myth, because I would disagree with him if
he's doing the latter... up until the last four years, that is.
I would think it would be a very interesting study
to look at a possible relationship between widespread home ownership in
America (and possibly other countries) and social-class mobility of the
middle-class. Home ownership served as a major source of wealth for my
great-grandparents, grandparents, and my parents' generations, and even for
my generation. Most of my own current non-retirement net worth was generated
as roll-over gains on homes which I sold as the company transferred me
around the country during my business career.
By contrast, in Europe, I saw a major social-class
gap between the owners of rental properties, and the renters. In talking
anecdotally with friends, they seemed to hold the view that in general, rich
people own homes (country estates, townhomes, subdivision houses, city
flats, etc.), and working-class stiffs rent those properties from them. They
felt that most of the European middle-class population: (1) were renters
rather than owners, and (2) were unable to save enough to materially
increase their net worth the way Americans do by owning homes and watching
them appreciate in value, and thus (3) were unable to climb the
socio-economic ladder and deliver to their kids a better life the way most
Americans have been doing for their children.
With apologies to Jagdish, the "caste inheritance"
system whereby ones' children end up in the same socio-economic level as
their parents, was somewhat more prevalent in Europe (albeit not at the
trade/craft/occupation level as in India, but at the socio-economic level).
For example, my father greatly exceeded his
father's level, as I have exceeded my father's, and my sons are almost ready
to exceed me, while many of our friends in Europe were about where their
parents and grandparents had been: children of blue collar workers became
blue collar workers, etc.
Of course, this might be due to educational
institutions, tradition, and many other factors besides home ownership. But
since home ownership was such a wealth-builder (e.g., a GOOD investment) for
about 100 years, I can't help but suppose an impact.
So I'm very curious as to what the current supposed
trend (identified in your article, of moving away from the "home-ownership
for every family" model to the "most everybody is renting their abode" will
do to the traditional American middle-class.
It's going to be an interesting next 50 years or
so.
David Fordham
July 11, 2011 reply from Bob Jensen
Hi David,
It will be very difficult to isolate the impact of home ownership apart
from other factors affecting the U.S., including birth control technology,
tax law changes, trends in delaying marriage, trends in couples living
together without marriage, reduced numbers of children per household, career
mobility, government policy on welfare that almost destroyed families the
some population sectors, collapse of housing values, increasing proportion
of women having long-term careers, etc.
Bob Jensen
Bob Jensen's helpers for personal finance are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
Investment Clubs, Hedge Funds, and Tax Implications
Investment clubs commenced with
friends in communities and/or work
places that sometimes made social events
out of studying investments and pooling
small amounts of money in a fund that in
turn was managed by the group as a whole
---
http://en.wikipedia.org/w/index.php?title=Special%3ASearch&redirs=0&search=Investment+club&fulltext=Search&ns0=1
I also think of an hedge fund as a
much larger investment club where a
professional investor generally manages
the investments for a group of
individuals who join that index fund.
Hedge funds, like lower end investment
clubs, do not sell shares in the club to
the public in general. An advantage and
a disadvantage of not going public is
that such funds, until recently, are not
subject to state and Federal securities
laws and SEC oversight, although since
the adverse publicity (read that Madoff
Hedge Fund) of the failed attempts are
being made by lawmakers to rein in on
hedge funds ---
http://en.wikipedia.org/wiki/Hedge_fund
The Madoff Hedge Fund turned out to be
the largest Ponzi Scheme in the World
(aside from the Social Security Fund of
the U.S. which is a Ponzi scheme not yet
shut down).
Investment Club Software ---
http://en.wikipedia.org/wiki/Investment_club_software
An Investment Club Helper Site
---
http://investmentclubsonline.com/result.php?Keywords=Investment%20Clubs
Note that investment clubs should
understand state and local tax laws
regarding investment club returns and
liquidations.
IRS Publication 550 (2008),
Investment Income and Expenses
http://www.irs.gov/publications/p550/index.html
Abusive Tax Scheme Investigations -
Fiscal Year 2009 ---
http://www.irs.gov/compliance/enforcement/article/0,,id=187267,00.html
Bob Jensen's taxation helpers are
at
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
A Nobel
Laureate Talks About the 4% "Rule" in
Personal Finance
Many retirees are advised to follow the
4% rule for managing spending and
investing. William F. Sharpe and his
co-authors argue that following this
advice can lead to overpayments and
surpluses. To avoid these pitfalls,
retirees also have to have a clear idea
of how much risk they are willing to
take.
Stanford Graduate School of
Business News, April 2010 ---
http://www.gsb.stanford.edu/news/research/sharpe_4percent.html
"What You Need to Know About
Socially Responsible Investing," by
Adam Bold, Yahoo Finance, April
19, 2011 ---
http://finance.yahoo.com/news/What-You-Need-to-Know-About-usnews-2251466802.html?x=0
Technology for Personal Finance
"Goalkeeping Gets Easier in the
Finances Arena New Mint.com Feature
Offers User-Friendly Options That Help
Savers Set Up Budget Objectives and
Stick to Them," by Katherine Boehret,
The Wall Street Journal, June 30,
2010 ---
http://online.wsj.com/article/SB10001424052748704911704575326914251218780.html
When most people hear the word
"budget," they groan about all the
numbers and spreadsheets involved in
setting financial goals. Instead
they procrastinate and continue
spending without any specific
savings goals. Case in point: I
recently postponed a meeting with my
financial planner because I didn't
have the energy after a long
business trip to work through my
finances.
Now Mint.com, a website that already
offers user-friendly options for
studying how one's money is spent,
has introduced an easy way to set
budget objectives, link them to
accounts and learn specific steps on
how to reach those goals. The goals
can even be personalized with
digital photos, like an image of the
car you're saving up to buy. And
this service, which launched
Tuesday, doesn't cost a cent.
I've been testing Intuit Inc.'s
free, updated Mint.com service,
specifically focusing on its new
Mint Goals feature. The idea of
adding goals that tie into real
accounts has been a long time coming
for the finance-management website.
Mint previously offered a Planning
section on its site, but it required
too much manual input, including
setting up personal budget
categories, and guesswork about how
much one should spend.
The Goals feature uses pop-up
windows where users can quickly
input data, like annual salary, to
get estimates on how much they can
afford to spend on things like a
vacation, as well as how much they
need to save for that vacation.
Monthly savings estimates can be set
to aggressive savings plans or
conservative ones with just a mouse
click.
Finances in One Place
Mint.com has been around for almost
three years and is already used by
millions of people. Its proprietary
algorithms encrypt data so people
will feel confident enough to input
their usernames and passwords for
their online financial accounts,
allowing them to see all of their
financial activity in one place.
These accounts include those tied to
credit cards, banks, retirement
savings and others. Mint is known
for displaying colorful visuals like
pie charts and graphs, so it's easy
for people to see where they're
spending their money or how it's
being invested.
Mint Goals is a new tab on the
Mint.com site, and clicking on it
directs users to a group of eight
popular goals and one that can be
customized (more will be added over
time). The preset list includes
goals to get out of debt, buy a
home, buy a car, save for college,
take a trip or save for retirement.
A digital checklist in each goal
called "Next Steps" gives people
serious, doable tasks to complete,
so they can actually make progress
toward a goal in ways other than
just putting money aside. This
instant gratification saved me from
doing a lot of calculating.
The Best Account
When you set up a goal for the first
time, Mint suggests what type of
account would work best for saving
toward it. Examples include a 529
savings plan for people who are
saving to put their kids through
college or a Roth IRA for retirement
savings. Mint will also tell you the
provider with the best interest
rate.
Unlike some other websites that
encourage saving, like SmartyPig.com,
Mint isn't a bank, so you'll have to
leave the Mint site to create
accounts and manage money transfers
rather than starting them right on
the site. Aaron Patzer, the
company's founder and CEO, expects
the site will enable setting up
savings accounts and money transfers
by the end of this year.
Each goal includes the overall
amount of money intended to be
saved, today's balance, planned and
projected dates for reaching the
goal and how much has been saved
this month (like $200 of $750). I
liked looking at Mint's colorful
thermometers, which quickly showed
me how I was progressing in a
particular goal.
For example, the Buy a Home goal
checklist includes steps like
finding a Realtor, getting
homeowner's insurance and getting
prequalified for a loan. A panel
beside each of these items also
offers an educational explanation of
what these steps really mean. Many
explanations include links to a blog
called MintLife, where blog posts
from Mint employees and some
freelancers offer deep explanations
about financial questions.
Ads With Context
The Goals feature comes with
contextual ads, which help it remain
free. One checklist item suggests
opening a high-yield savings account
and also offers links to the
Discover and American Express
websites, which offer the accounts.
If you've started a Mint Goal to
save for a trip to Iceland, travel
insurance is suggested, along with
Web links to sites that sell trip
insurance.
While these links might allow people
to get started right away on a
particular task, they also beg the
question of whether these are the
best options for users—or just the
biggest advertisers on Mint. Mr.
Patzer explained that companies for
these ads are chosen according to
what's best for the user and are
selected from a list of savings
options ranked by the site's
editors.
Goals can be linked to several of
your accounts on Mint so they're
updated with real-time data. A
long-term retirement goal can link
to a 401(k), brokerage account and
retirement account. If the stock
market takes a dive and money is
lost in an account, that loss is
automatically reflected in the
overall goal's balance. If you tie a
savings account to a goal to save
for a house, every dollar added to
that account (on the bank's end) is
automatically reflected in the goal.
Mint already gave people a visually
engaging way to know more about what
their money is doing, but Mint Goals
give people a real reason to come
back to the site more often.
Mint.com home page ---
http://www.mint.com/
Bob
Jensen's personal finance helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Spent: A Poverty A Game 23% of
America Does Not Need to Play
Adrienne Gonzalez, Jr. Deputy
Accountant, February 26, 2011 ---
http://www.jrdeputyaccountant.com/2011/02/game-23-of-america-does-not-need-to.html
Bob Jensen's threads on personal finance
---
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelper
"2010: The Year of the Roth
Conversion?" by Rich Arzaga,
Journal of Accountancy, January 2010
---
http://www.journalofaccountancy.com/Issues/2010/Jan/20091743.htm
This year will be the Year of the
Tiger, according to Chinese custom,
but it also could be remembered by
investors as the Year of the Roth
Conversion, a decision that can have
a large impact on investors’ ability
to build wealth during their
lifetime and preserve wealth for
beneficiaries.
Prior to 2010, anyone (except
married taxpayers filing separately)
with an annual adjusted gross income
(AGI) of no greater than $100,000
could convert a traditional IRA to a
Roth IRA. The AGI cap has prevented
higher-income earners, a class of
savers that might have benefited
most from this strategy, from
participating. However, under the
Tax Increase Prevention and
Reconciliation Act of 2005 (TIPRA)
these previously ineligible
taxpayers will be eligible to
participate starting this year
(including married but separate
filers). In fact, there is an
incentive to take action in 2010:
Everyone who converts this year may
defer and spread income recognition
from the conversion over tax years
2011 and 2012. A conversion in 2010
thus could reduce the marginal tax
rate and total taxes due on what
otherwise would be a larger
single-year distribution. The 10%
penalty tax otherwise imposed on
early or excess distributions from
an IRA does not apply. A conversion
could be an attractive retirement
income and estate planning strategy
for wealthy individuals and
high-income earners who seek to
reduce taxes later in life and
transfer more wealth to
beneficiaries tax-free. But like any
other approach to income and taxes,
this decision is eventually based on
a set of sustainable assumptions and
specific objectives of the taxpayer.
ADVANTAGES OF A ROTH ACCOUNT
A chief advantage of a Roth IRA is
that it has more flexible rules
concerning distributions. Also,
taxpayers who are otherwise unable
to contribute to a traditional IRA
can take advantage of a Roth IRA’s
appreciation free from tax on gains.
Other advantages of a Roth IRA
include:
-
In most instances,
contributions can be
withdrawn at any time
without penalty. Earnings
may be withdrawn without tax
or penalty if the taxpayer
is at least age 59½ and has
held the Roth account for at
least five years. Similar
strategies that provide for
tax-free growth and
withdrawal are the IRC § 529
plans for college education
and cash-value life
insurance policies. Each has
its strengths and
limitations.
-
With a Roth IRA, there are
no required minimum
distributions (RMDs) like
those that apply to
traditional IRAs when the
taxpayer reaches age 70½.
For affluent families with
sufficient resources for
retirement income, the RMD
can seem an unnecessary
expense with a confusing
formula. From a client’s
perspective, eliminating
RMDs can provide a great
sense of relief from the
annual hassle of calculating
and managing these
distributions.
-
Unlike with traditional IRA
accounts, taxpayers can
continue to contribute to a
Roth IRA after reaching age
70½—also an attractive
feature as Americans
redefine retirement and
continue to be industrious
into later years. Starting
in 2010, a retired couple
can contribute $12,000 each
year (including the “over-
50 make-up” amount) into
Roth accounts. The AGI
limits on regular
contributions to a Roth IRA
still apply, but it is
possible to make
nondeductible contributions
to a traditional IRA and
convert them to a Roth,
regardless of AGI. These
contributions grow free of
income tax indefinitely,
creating significant value
for taxpayers as well as
their beneficiaries.
-
A tax-diversified retirement
distribution strategy also
helps with Social Security
planning. Up to 85% of
Social Security benefits are
taxable. When calculating
modified adjusted gross
income (MAGI) for Social
Security purposes, taxpayers
must include all taxable and
tax-exempt income and 50% of
their Social Security
benefits, but not Roth IRA
distributions. Having a Roth
IRA to supplement retirement
income can be very important
in managing the taxability
of Social Security benefits.
IDEAL
CONVERSION CANDIDATES
Some taxpayers may benefit more than
others from converting to a Roth
IRA. Assuming there are no cash flow
issues, risk management gaps, other
tax planning considerations that
need to be weighed against the
benefit of a conversion, advance tax
issues at play, or adverse
legislative changes, taxpayers who
stand to benefit the most are those
who:
-
Are wealthy.
-
Seek to reduce estate
settlement costs.
-
Won’t need to draw income
from converted retirement
accounts.
-
Are young, high-income
earners.
-
Believe their tax bracket
will be the same or higher
in retirement, or more
specifically, when they draw
income from their qualified
retirement accounts. The
attractiveness of
traditional IRAs and
qualified retirement plans
depends on the assumption
that taxpayers will have a
lower effective tax rate
after retirement, when the
deferred taxes on the
savings will come due.
Conversely, taxpayers whose
tax rate seems more likely
to be the same or higher in
retirement might just as
soon pay taxes on income now
and accumulate tax-free
gains. Consider the
conversion comparison in
Exhibit 1.
Continued in article
Bob Jensen's taxation helpers are
at
http://faculty.trinity.edu/rjensen/BookBob1.htm#010304Taxation
History and Strategy
of Poker ---
http://en.wikipedia.org/wiki/Poker
Warning: Gambling online is not recommended since the games tend to be
rigged according to an expose on CBS Sixty Minutes
Interestingly many of the online games are run by Canadian Native Americans not
subject to gambling laws in Canada.
CBS Sixty Minutes tied some online cheating to organized crime located
--- Guess? Would you believe Las Vegas.
"Online Poker
Study: The More Hands You Win, the More Money You Lose (even if the games
are honest) ," Science Daily, January 13, 2010 ---
http://www.sciencedaily.com/releases/2010/01/100112152410.htm
The likely reason, said Cornell
sociology doctoral student Kyle
Siler, whose study analyzed 27
million online poker hands, is that
the multiple wins are likely for
small stakes, and the more you play,
the more likely you will eventually
be walloped by occasional -- but
significant -- losses.
This finding,
Siler said, "coincides with
observations in behavioral economics
that people overweigh their frequent
small gains vis-à-vis occasional
large losses, and vice versa." In
other words, players feel positively
reinforced by their streak of wins
but have difficulty fully
understanding how their occasional
large losses offset their gains.
Continued in article
"How
Poker Can Make You a Better Investor,"
by Bob Frick, Kiplinger, January 7, 2010 ---
http://www.kiplinger.com/features/archives/how-poker-can-make-you-a-better-investor.html?kipad_id=x
Ever watch professional poker
players calculating the odds, then
coolly dissecting their opponents?
Many of the same skills the top
players use can help you be a better
investor. Success at both investing
and gambling, it turns out, has much
to do with controlling emotions. And
playing a little poker can help you
recognize, and avoid, emotional
traps that endanger your most
important stack of chips -- your
portfolio. But you need to know what
to look for.
The
psychological issues that drive
investing and gambling decisions
aren’t merely similar. They are
“identical,” says Andrew Lo,
director of the Massachusetts
Institute of Technology Laboratory
for Financial Engineering and one of
the leaders in the field of
behavioral finance (listen to
our podcast with Lo).
It’s easy to
find investment professionals and
professional poker players who
agree. Says poker pro Daniel
Negreanu, who holds four World
Series of Poker bracelets and two
World Poker Tour Championship
titles: “Having emotional stability
and emotional control is key to both
investing and poker.”
Can you gain that control at a poker
table? Aaron Brown is among many who
think so. Brown is a onetime finance
professor and former portfolio
manager for Prudential Securities
who is now a risk manager for hedge
funds. He’s also the author of
The Poker Face of Wall Street
(Wiley, $17). Says Brown: “People
tell me playing poker is risky.
Investing for a financial lifetime
without playing poker is risky. I’d
much rather make these mistakes at
the table.”
And by
mistakes, Brown means the common
emotional errors that plague
investors. The burgeoning fields of
investor psychology and
behavioral finance are
uncovering more about these errors
all the time, and they are the
subject of a
year-long series
co-produced by
Kiplinger’s and Nightly
Business Report on PBS.
By playing some poker, “you can find
out your tendencies to make
emotional mistakes, and then you can
guard against them,” says Frank
Murtha, a behavioral-finance
consultant with a PhD in counseling
psychology (his dissertation
explored the effect of psychological
errors in gambling). Murtha helps
clients from investment banks,
financial-services companies and
trading firms to avoid making
psychological errors.
He’s also
co-founder of
MarketPsych,
which offers psychological-training
services to traders and money
managers and which offers a number
of online tests that any investor
can take to better understand his or
her own psychological makeup.
Most investors make few investment
decisions over a year, or even over
a lifetime. But experts agree that
just a few hours of playing poker
will take you through literally
dozens of financial decisions --
potentially a lifetime’s worth if
you were making those decisions
about your portfolio. By playing
poker while keeping in mind the
psychological errors that are also
common to investing, you can get a
lifetime’s worth of training in one
evening.
What are these errors? We’ve picked
five of the most common, and all can
be found both in investing and in
gambling. Click on each one below to
learn how they appear in poker and
investing and to find out how you
can use poker to help train yourself
not to make these errors.
Greed
Overconfidence
Regret
Seeing patterns
Holding on to losers
More on Poker and Investing
How Texas Hold 'Em Simulates
Investing
How Deepak Chopra Helped Me Become a
Better Poker Player
SPECIAL REPORT: Your Mind, Your
Money
Next page: GREED
Bob
Jensen's personal finance and investment helpers are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
Question
What is hyperbolic discounting?
"Psychology of poverty and
temptation," by Chris Blattman,
September 2009 ---
http://chrisblattman.com/2009/09/15/psychology-of-poverty-and-temptation/
Some people
are impulsive and impatient; they
prefer a dollar or a donut today far
more than a dollar or a donut
tomorrow, so much so that they’re
willing to give up shocking amounts
of dollars and donuts tomorrow for
just one today. This is one reason,
some say, that we see such high
interest rates for short-term
borrowing, from New York to
Calcutta.
Some people
are not only impulsive and
impatient, but inconsistently so.
they care a lot about a dollar today
versus tomorrow, but could care less
between getting a dollar either 10
or 11 days from now.
Economists
call this ‘hyperbolic discounting’.
Both behaviors–impatience and
time inconsistency–could be a source
of persistent poverty.
Or not.
Abhijit Banerjee presented
a new paper here
yesterday,
written with MIT colleague Sendhil
Mullainathan. They look at a number
of seemingly unusual behaviors by
the very poor–from exorbitant rates
of short-term borrowing to the low
take-up of small, high-return
investments. Impatience cannot
explain the patterns, they say. The
impatience approach also requires
the poor think differently than the
rest of the population.
Another
view: we’re all impulsive and
impatient in the same way, but over
a narrow range of goods that are
quickly and cheaply satisfied. If
you’re poor, these temptations are a
big fraction of your income. If
you’re even somewhat wealthy, they
are not. Temptations are declining
in income.
The paper
runs through half a dozen perplexing
patterns of behavior, and shows that
these simple assumptions can explain
a great deal.
This
approach has a great deal in common
with hyperbolic discounting, but is
empirically distinct (and has very
different policy implications).
Parsing out and testing these
subtleties strikes me as one of the
most important frontiers in the
study of poverty. Declining
temptation, if true, could explain
all sorts of odd behaviors. With
more than a few Uganda and Liberia
surveys on the horizon, I’m
now scheming ways to test whether
it’s true.
It’s a
difficult paper, especially for
those uninitiated in micro-economic
theory. Even if that sounds like
you: the subtle points are worth the
slog.
For an intro
to the subfield, see Senthil’s
essay,
Development economics through the
lens of psychology.
Another great
resource is Stefano Dellavigna’s
recent JEL article on
evidence from the field.
Both are ungated.
Behavioral
and Cultural Economics and Finance ---
http://faculty.trinity.edu/rjensen/theory01.htm#Behavioral
78% of
former NFL players have gone
bankrupt
or are under financial stress because of
joblessness or divorce.
Championship Rings in pawn shops, IRS
vaults, Ponzi schemer stashes offshore,
or in the clutches of ex-wives
What on earth did athletes learn in
college?
Pros seem especially susceptible
to Ponzi schemes. Some recent examples ---
Click Here
10 Ways Sports Stars
(multi-millionaires) Go From Riches To
Rags," by Lawrence Delevingne,
Business Insider, September 18, 2009 ---
http://www.businessinsider.com/10-ways-sports-stars-destroy-their-finances-2009-9
Sports
Illustrated article this year
showed
how shockingly common financial ruin
is:
-
By the
time they have been retired for
two years, 78% of former NFL
players have gone
bankrupt
or are under financial stress
because of joblessness or
divorce.
-
Within
five years of retirement, an
estimated 60% of former NBA
players are broke.
-
Numerous retired MLB players
have been similarly ruined.
If that's
not bad enough, the
recession
has made things even worse. Too much
money in real estate; investments in
Ponzi schemes; and poor financial
advising have been exposed with the
down economy.
A sign of the
times? More former stars are
selling their championship rings for
money than ever.
"It's amazing
that I heard the recession was
over," says Timothy Robins, owner of
Championshiprings.net,
who buys bling
from current and former pros and has
seen a 36% increase in sales during
the past year. "I'm getting more
calls from players than ever.
They're having a really hard time."
While just
about everyone has
lost
money
over the past
year, athletes tend to make
particularly bad financial
decisions, and it's not just
reckless spending.
How they lose their wealth ---
Click Here
http://www.businessinsider.com/10-ways-sports-stars-destroy-their-finances-2009-9#put-cash-in-a-ponzi-scheme-1
The 10 ways sports pros blow
their cash >>
Jensen Comment
The same goes for many, many movie stars
like Debbie Reynolds who, very late in
their lives, are "willing to work for
food."
The boots in Hollywood's Boot Hill
are not stuffed with savings.
How to avoid losing your money to
fraud ---
http://faculty.trinity.edu/rjensen/FraudReporting.htm
Behavioral and
Cultural Economics and Finance ---
http://faculty.trinity.edu/rjensen/theory01.htm#Behavioral
"The Best Online Tools (software, services) for Personal Finance,"
The Wall Street Journal, June 8, 2009 ---
http://faculty.trinity.edu/rjensen/PersonalFinanceTools.htm
1. Budgeting Your Money
2.
Creating a Financial Plan
3. Tracking
Investments and Getting Advice
4. Checking for Fraud
5. Keeping Track of Credit
6. Managing Loans
Details at
http://faculty.trinity.edu/rjensen/PersonalFinanceTools.htm
Bob Jensen's helpers for personal
finance ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Bob Jensen's threads on Accounting
Software ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
Money Market Funds Are Not as Risk
Free as Bank Accounts
What very
few people are talking about, however,
is a more radical solution to the moral
hazard question raised by money market
funds. Maybe the right approach now is
to acknowledge the truth. Money market
funds are not, in fact, turbocharged
bank accounts. They are investment
vehicles. However “safe” the securities
they invest in, they contain an element
of risk. Indeed, the very reason they
yield more than savings accounts is that
they are riskier. That’s how investing
works. So maybe, in this post-Reserve
Fund world, it’s time for the industry —
and investors — to stop pretending that
money funds are risk-free. As it turns
out, there is a pretty simple way to do
this. As it also turns out, the money
market fund industry is dead-set against
it.
Joe Nocera, "It’s Time to Admit That
Money Funds Involve Risk," The New
York Times, August 28, 2009 ---
http://www.nytimes.com/2009/08/29/business/29nocera.html?_r=2
Follow the Herd: Can you identify a
moral hazard here?
From
the Finance Professor Blog on October
19, 2009 ---
http://financeprofessorblog.blogspot.com/
"KaChing, a Web site where 400,000
amateur and professional investors
manage virtual portfolios. Others
have logged on to see what the
investors on the site are doing and
make the same trades in their own
real portfolios.
On Monday, KaChing is to add a new
twist. Customers can set up
brokerage accounts that
automatically mirror the trades of a
money manager, some of them
professionals.
“The idea of an asset manager
showing all his research, his
holdings — it’s unheard-of,”"
The trouble with
mutual funds is that investors can feel
as though they have put their money in a
black box. The 90 million Americans with
money in funds know little about fees,
what securities their money is invested
in and who is in charge . . . KaChing
has attracted a roster of prominent
early investors from Silicon Valley who
have financed the company with $3
million. They include Marc Andreessen,
co-founder of Netscape; Kevin Compton of
Kleiner Perkins Caufield & Byers; and
Jeffrey Jordan, chief executive of
OpenTable, the online reservation
service. The angel investors have also
been investing their own money through
KaChing during the pilot period. “The
concept is great — the ability to tap
into not just the wisdom of the crowd,
but to be able to identify and invest
with the particular geniuses in the
crowd that stand out,” said Mr.
Andreessen, who has invested $100,000
using the site.
Claire Cane
Miller, "Site
Lets Investors See and Copy Experts’
Trades," The Wall Street Journal,
October 19, 2009 ---
http://www.nytimes.com/2009/10/19/technology/start-ups/19kaching.html?_r=1
Jensen
Comment
Money managers are human. Some might
loose their tempers at a company to the
point they lead their herds off cliffs
just to get back at a company. Some
money managers may be secretly greedy
for themselves or friends and family and
lead their herds with hidden agendas
based on greed. For example, this is one
way for a money manager to help out one
of his buddies who founded a small
technology company with high financial
risk at the moment.
Stock
pickers in the WSJ's "Heard on the
Street" and other financial news sites
are watched closely such that they are
not manipulating their private accounts
with hidden agendas that make themselves
wealthy at the expense of readers.
I'm not
arguing that there's anything illegal or
even unethical about KaChing's "new
twist." I just feel that the lemmings
should be aware of the moral hazard.
The
KaChing homepage is at
http://www.kaching.com/
Stocks are
still the best investment for the long
run. But maybe not for your long run.
Justin Fox, "Are Stocks Still
Good for the Long Run?" Time Magazine,
June 15, 2009 ---
http://www.time.com/time/magazine/article/0,9171,1902843-2,00.html
Also see Jim Mahar's June 10, 2009
summary at
http://financeprofessorblog.blogspot.com/
In particular this references a study by
Arnott that asserts that over the past
40 years the stock market underperformed
the bond market. In my opinion, if you
into bonds for the next 40 years they'd
better be inflation-indexed bonds such
as Treasury TIPs.
Bob Jensen's threads on the
Efficient Markets Hypothesis ---
http://faculty.trinity.edu/rjensen/theory01.htm#EMH
PBS Television will now answer
your personal finance questions ---
http://www.pbs.org/newshour/insider/business/jan-june09/pocketchange_05-05.html
Personal Finance
Helpers
From Smart Stops on the Web, Journal
of Accountancy, July 2008
KEEPING IT
SIMPLE
This Smart Stop’s author
puts together a “Blueprint
for Financial Prosperity,”
working and blogging through
the complexities of personal
finance. Articles include
“Speed Up or Shift Up:
Thinking About Your Income
Path” and “Do You Have an
Opportunity Fund?” Also find
tax and investing coverage,
plus reviews of financial
planning and wealth
management books. Every
month, the author plays
“Devil’s Advocate,” where he
examines the other side of
“mainstream” or “common
sense” personal finance
ideas. Recent “Advocate”
posts include “Don’t Budget
to the Penny” and “Don’t
Just Buy Index Funds.”
THIS WEEK
IN PERSONAL FINANCE
The Carnival of Personal
Finance touts itself as “a
traveling weekly showcase of
the best blog articles on
the topic.” The carnival is
hosted by a different guest
blogger each week. In every
edition, you’ll find links
to the guest editor’s picks
of the week, typically
highlighting five to 10
posts from various sources,
which feature expert advice
on professional sites or
regular-Joe experiences on
personal sites. You can
submit your own post for
consideration, view the
schedule of upcoming hosts
or just browse the wealth of
archived articles. |
The AICPA maintains a financial
literacy site at
http://www.aicpa.org/financialliteracy/FeedThePig/
Why
mutual funds are dangerous investments
---
http://hk.youtube.com/watch?v=irZi9YZVEyo
This is good advice to a point. However,
most investors have different
circumstances such as liquidity
preferences, tax complications, and
different ages such that there may not
be a safe index fund suitable for every
investor.
Center for Retirement Research at Boston
College ---
http://crr.bc.edu/
Investment Clubs, Hedge Funds, and Tax Implications
Investment clubs commenced with
friends in communities and/or work
places that sometimes made social events
out of studying investments and pooling
small amounts of money in a fund that in
turn was managed by the group as a whole
---
http://en.wikipedia.org/w/index.php?title=Special%3ASearch&redirs=0&search=Investment+club&fulltext=Search&ns0=1
I also think of an hedge fund as a
much larger investment club where a
professional investor generally manages
the investments for a group of
individuals who join that index fund.
Hedge funds, like lower end investment
clubs, do not sell shares in the club to
the public in general. An advantage and
a disadvantage of not going public is
that such funds, until recently, are not
subject to state and Federal securities
laws and SEC oversight, although since
the adverse publicity (read that Madoff
Hedge Fund) of the failed attempts are
being made by lawmakers to rein in on
hedge funds ---
http://en.wikipedia.org/wiki/Hedge_fund
The Madoff Hedge Fund turned out to be
the largest Ponzi Scheme in the World
(aside from the Social Security Fund of
the U.S. which is a Ponzi scheme not yet
shut down).
Investment Club Software ---
http://en.wikipedia.org/wiki/Investment_club_software
An Investment Club Helper Site
---
http://investmentclubsonline.com/result.php?Keywords=Investment%20Clubs
Note that investment clubs should
understand state and local tax laws
regarding investment club returns and
liquidations.
IRS Publication 550 (2008),
Investment Income and Expenses
http://www.irs.gov/publications/p550/index.html
Abusive Tax Scheme Investigations -
Fiscal Year 2009 ---
http://www.irs.gov/compliance/enforcement/article/0,,id=187267,00.html
Bob Jensen's investment helpers
are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#WebsitesForInvestors
Bob Jensen's taxation helpers are
at
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
Helpful Calculators free from the Florida Institute of CPAs ---
http://www.ficpa.org/ficpa/ResourceCenter/Calculators
Bob Jensen's threads on helpful
calculators ---
http://faculty.trinity.edu/rjensen/Bookbob3.htm#080512Calculators
Bob Jensen's personal finance
helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Question
In the public accounting profession, what's a PFS?
Hint
PFS is a new credential to put after
one's name --- it looks better than
Pfffssssttt
The American Institute of Certified
Public Accountants (AICPA) and Texas
Tech University's Division of Personal
Financial Planning have announced a
joint agreement to develop a new
educational program that will lead to
the AICPA's Personal Financial
Specialist (PFS) credential. The program
will officially begin in June 2009, but
the AICPA and Texas Tech have announced
that they will conduct a PFS Pathway
beta program or test program at AICPA
offices in Dallas November 10 through
14th. The PFS beta program consists of
four days of intense comprehensive
personal financial planning case study
in 12 technical areas, including estate
planning, employee benefits, investment
planning, financial independence, and
income tax planning. Participants take
an eight-hour multiple choice exam of
approximately 200 questions on the fifth
day.
"AICPA and Texas Tech announce new
pathway to PFS credential,"
AccountingWeb, August 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=105793
Bob Jensen's threads on personal finance
are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Bob Jensen's threads on credit reporting
are at
http://faculty.trinity.edu/rjensen/FraudReporting.htm#FICO
Bob Jensen's helpers for finding a
financial advisor are at
http://faculty.trinity.edu/rjensen/fees.htm
Bob Jensen's career helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Mutual Funds: 10 questions to test your
IQ (ten answers every investor should
know by heart) ---
http://www.azcentral.com/business/consumer/articles/2009/04/10/20090410biz-MutualFundsQuiz0410.html
"How to Prevent Investment Adviser Fraud," by Brian Carroll, Journal of
Accountancy, January 2006 ---
http://www.aicpa.org/pubs/jofa/jan2006/carroll.htm
EXECUTIVE SUMMARY |
SECTION 206 OF THE INVESTMENT ADVISERS ACT
OF 1940 provides guidelines for
investment advisers on what constitutes
fraud.
THE SUPREME COURT HAS HELD THAT THE ACT
imposes a fiduciary duty on
investment advisers to act in the best
interest of their clients by fully
disclosing all potential conflicts of
interest.
INVESTMENT ADVISERS SHOULD REVIEW CAREFULLY
SEC and other disclosure
requirements to ensure they clearly
understand potential conflicts.
INVESTMENT ADVISERS SHOULD REVIEW ALL SEC
FILINGS, client marketing materials
and other significant documents to ensure
that they have appropriately disclosed all
potential conflicts. |
Brian
Carroll, CPA, is special counsel with the
SEC in Philadelphia and an adjunct professor
at Rutgers University School of Law, Camden,
N.J. |
|
|
Alpha Return on Investment ---
http://en.wikipedia.org/wiki/Alpha_(investment)
What the professional investors
don't tell you ---
I downloaded this video ---
http://www.cs.trinity.edu/~rjensen/temp/FinancialRounds.flv
From the Financial Rounds Blog on
September 4, 2009 ---
http://financialrounds.blogspot.com/
When I
teach investments, there's always a
section on market efficiency. A key
point I try to make is that any test
of market efficiency suffers from
the "joint hypothesis" problem -
that the test is not tests market
efficiency, but also assumes that
you have the correct model for
measuring the benchmark
risk-adjusted return.
In other words, you can't say that
you have "alpha" (an abnormal
return) without correcting for risk.
Falkenblog makes exactly this
point:
In my book
Finding Alpha
I describe these strategies, as
they are built on the fact that
alpha is a residual return, a
risk-adjusted return, and as
'risk' is not definable, this
gives people a lot of degrees of
freedom. Further, it has long
been the case that successful
people are good at doing one
thing while saying they are
doing another.
Even better,
he's got a pretty good video on the
topic (it also touches on other
topics). Enjoy.
You can watch the video under
September 4, 2009 at
http://financialrounds.blogspot.com/
I downloaded this video ---
http://www.cs.trinity.edu/~rjensen/temp/FinancialRounds.flv
Bob Jensen's threads on Return on
Investment (ROI) are at
http://faculty.trinity.edu/rjensen/roi.htm
Bob Jensen's threads on market
efficiency (EMH) are at
http://faculty.trinity.edu/rjensen/theory01.htm#EMH
50 Most Common Mistakes Made by
Traders and Investors ---
http://www.ratiotrading.com/2009/09/50-common-mistakes-most-traders-make/
"Firms Take to The Tweetable Business Model," by
Kim Hart, The Washington Post, March 9, 2009 ---
Click Here
Twitter, that microblogging tool that caught on
with teens and twentysomethings using it to tell loyal followers what
they're doing at any given time -- in 140 characters or less -- is now
becoming part of the business strategy for a wide range of brands, from
Skittles to Fairfax County.
As exciting as it may be to hear about what your
friends, or total strangers for that matter, ate for breakfast, some
companies are realizing that a more effective use of Twitter is to mine it
for clients, recruit employees and answer customer service questions.
To that end, some businesses are starting to host
Twitter tutorials for employees.
Network Solutions, a Web-hosting and online
marketing company based in Herndon, held a brown-bag lunch session last week
to teach staffers how to sign up for a Twitter account, how to send messages
to individuals and how to search for people who may be talking about the
company in messages, or "tweets."
Twitter is an easy way to create buzz for a new
product launch or to alert customers to a service outage. Earlier this week,
the Skittles Web site directed visitors to a Twitter search for the term
"skittle" to see what people were saying about the candy. Attendees at
conferences and other business-related gatherings already use the service to
relate details on an unusually interesting session or to share news
announcements.
For example, at a conference focused on global
health last month, philanthropist Bill Gates released a jarful of mosquitoes
into a room to make a point about the spread of malaria.
"And people found out about that first on Twitter,"
said Steven Fisher, community and social media manager at Network Solutions.
Shashi Bellamkonda, Network Solutions' social media
swami (yes, that's his real title), organized the tutorial, attended by
about 30 people. He's a more prolific Twitterer than most, posting anywhere
from five to 15 tweets per day about anything from his daily routine to the
news. Big companies such as Dell are active in the Twitterverse addressing
customer service issues, he said.
Fairfax County government is also experimenting
with Twitter, sending out announcements about snow-induced school closings
and county board meetings.
Companies are now accustomed to monitoring blogs
and other consumer-generated content for mentions of brands -- in fact,
companies such as Arlington-based New Media Strategies have made a
profitable business out of it. Similarly, Bellamkonda wants Network
Solutions employees to take notice of any questions, complaints or other
mentions of the company that pop up on Twitter.
W. Roy Dunbar, the firm's chief executive, said it
is even more important to communicate with customers during an economic
downturn. He said he gives his social media team free rein to experiment
with new tools.
"Next time, we'll conduct the meeting entirely in
tweets," Bellamkonda said.
It may be a short meeting.
Rediscovering the Internet
The crusade for government transparency and open
data -- two of the biggest buzzwords in Washington since President Obama put
them on his agenda -- has gained momentum over the past week.
Vivek Kundra, the District's chief technology
officer, was officially named as the federal chief information officer
Thursday, ending months of speculation about what the brand-new job entails
and what it means for how government agencies use technology.
While the answers to those questions are still
unclear, the announcement prompted a collective cheer from some local
developers. As an example of what Kundra may do with federal technology
projects, many of them point to the contest he held last year called Apps
for Democracy, which challenged independent Web developers to come up with
interesting ways to use government data.
District-based Development Seed, a Web consulting
group, mashed together government data and other online resources to create
DC Bikes, a site with information about bike thefts, popular bike trails and
other information for local bike enthusiasts.
Continued in article
March 10, 2009 reply from Roger
Debreceny
[roger@DEBRECENY.COM]
Gerry
Trites asked about Investor
Relations on Twitter. I follow his
countryman, Dominic Jones
(http://twitter.com/irwebreport
and
http://www.irwebreport.com/)
closely. He
points to much going on on Twitter.
See, for example,
http://preview.tinyurl.com/amw98y
on “eBay’s lawyers are wrong to
delete earnings call information”
and
http://preview.tinyurl.com/avv4yl
on
“SEC disclaimers in the age of
Twitter”.
BTW,
if you want to see your portfolio
bump around rock bottom in real
time, you can get stocktwits at
http://stocktwits.com/ ..
Of
course, you can also follow me on
Twitter at
www.twitter.com/debreceny and
see very important, indeed earth
shattering, information such as “OMG
I fractured my big toe and can’t
ride my bike for a month” and “Yeah,
my toe is OK and I can ride again!”
<Bg>
Regards
Roger
Question
Did your grandparents give you a prepaid college 529 savings account?
"Volatility Hits Prepaid 529s," by
Jillian Mincer, The Wall Street
Journal, March 9, 2009 ---
http://online.wsj.com/article/SB123663406748876025.html?mod=todays_us_personal_journal
The market volatility that has
squeezed pension plans is having a
similar impact on one kind of
college 529 savings account -- the
prepaid plan.
Like pensions, almost all of the
plans have seen their assets
significantly drop as their
investments have plunged. At the
same time, college costs have kept
rising.
At least one state -- Alabama -- has
notified plan participants that it
will be considering options, which
could include closing enrollment,
later this month.
"It's a
potential crisis for at least some
of these plans," says Joe Hurley,
founder of
www.savingforcollege.com,
an independent
Web site that provides information
about 529 plans. "They may go to the
state and ask for funds."
About a dozen prepaid 529 college
savings plans are available. While
details of the plans vary, all allow
families to buy all or part of a
college education at today's prices.
Typically, the accounts are
guaranteed by states to at least
match in-state tuition increases.
Continued in article
Question
Are risky returns higher or lower than the risk free rate on average over long
periods of time?
First learn about the theory of
mean reversion at
http://en.wikipedia.org/wiki/Mean_reversion
"Reversion to the Mean Why treasuries
have outperformed equities," The
Economist via CFO.com,
November 10, 2008 ---
http://www.cfo.com/article.cfm/12585264/?f=rsspage
GREATER risk means greater reward,
right? Wrong, at least over the last
25 years. As the graph shows,
Treasury bonds have actually
outperformed riskier asset classes
over the last quarter century. That
is despite the long equity
bull-market from 1982 to 2000.
Treasury bonds have understandably
beaten equities this year, when the
financial sector has been in crisis
and the economy headed towards
recession. The government
bond-market always performs well at
times of crisis. But the last 25
years have been, by and large, a
pretty good time for global
economies, marked by the "great
moderation" in inflation and growth.
But the last quarter century has
been positive for all asset classes,
with government debt, corporate
bonds and Treasuries all returning
an average of around 10% a year in
nominal terms. So why have
Treasuries done so well in relative
terms? The explanation, as Jim Reid
of Deutsche Bank explains, lies in
reversion to the mean.
Asset classes can go through long
periods when they underperform,
leaving them cheap and ripe for
revaluation. That happened to
Treasury bonds, which suffered four
consecutive decades of negative real
returns from the 1940s through the
1970s. At that point, Paul Volcker,
then the Federal Reserve chairman
and now an advisor to
President-elect Barack Obama,
successfully brought down inflation,
allowing investors to lock in
double-digit Treasury yields. It was
one of the great historical buying
opportunities.
Such a period is extremely unusual.
Since 1900, the average annual
return from Treasuries has been
4.6%, or 1.5% after allowing for
inflation. In contrast, American
equities have delivered 9.3%, or 6%
in real terms.
The current poor performance of
stockmarkets reflects, of course, a
reversion to the mean after the
excesses seen during the dotcom
bubble, when the rolling 25-year
annual return of US equities reached
a remarkable 16%. On a 10-year
basis, the return from equities has
now slumped to minus 3.5% in real
terms.
. . .
There are two important caveats.
First, this kind of analysis is no
use at all in predicting short-term
movements. Second, markets spend
very little of the time at fair
value (on Mr Reid's calculations),
tending to veer wildly from one
extreme to another. All three asset
classes might still be overvalued;
after all, the figures show returns
over the last quarter century have
been well above average.
Jensen Comment
This speaks in favor of jumping out of equity at the instant a bubble begins to
burst. but it's generally difficult to identify a true bubble early on. Plus the
media is always urging the public not to panic and to hang on to equity
investments on the theory that what goes down goes back up.
The media, however, probably does not have a clue about
mean reversion.False positive bailouts can lead unnecessary transactions
costs. Also if your equity investment is tied up in a pension fund like CREF,
you don't have fast reacting options.
Helpers in planning for retirement ---
http://www.plan-for-retirement.com/
Naked Shorts: Irreverent Investment Ideas ---
http://nakedshorts.typepad.com
Advertisement Free Personal
Finance Blogs ---
http://pfblogs.org/blog/29
Bob Jensen's investment
helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#Finance
Question
Where can you find one of the best definitions of hedge funds and summaries of
alternative hedge fund strategies?
Answer
Where else than Wikipedia ---
http://en.wikipedia.org/wiki/Hedge_fund
Bob Jensen's rather puny set of threads
in comparison is under the H-terms at
http://faculty.trinity.edu/rjensen/acct5341/speakers/133glosf.htm#H-Terms
Tax Breaks for College Savings: Now may
be the best time for starting to save for the college education of your children
or grandchildren
"529
College Savings Plans remain a mystery
to most parents," AccountingWeb,
August 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=104018
Parents are counting on credit to
counterbalance skyrocketing college
costs, according to The State of
College Savings, a survey to assess
the state of college savings
conducted by the College Savings
Foundation. Fifty-four percent have
saved less than $5,000 toward their
goal and almost 40 percent expect to
take at least 10 years to dig out of
the daunting debt expected to send
their children to college.
The survey of 447 parents, who span
income levels and crisscross the
country, revealed for the first time
that American families intend to
rely on long term-debt, rather than
savings, to fund their children's
futures. Even though 79 percent of
all respondents would be highly
disappointed if their children could
not afford to go to college, over
half, 51 percent, of that group has
saved less than $5,000 per child.
Continued in article
Morningstar, the
global investment research firm has
published its annual list of the best
and worst 529 plans – when it comes to
earning long-term returns for college
savers – and the overall opinion smacks
of optimism. Some of the worst plans
from years past have folded up and gone
away, while others continually strive to
improve.
AccountingWeb, August 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=105846
"Twelve
tips for funding that college
education," AccountingWeb, August
2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=104016
There's a
shelf of financial bestsellers whose titles now sound absurd: Ravi Batra's The
Great Depression of 1990; James Glassman's Dow 36,000; Harry Figgie's Bankruptcy
1995: The Coming Collapse of America and How to Stop It. There’s BusinessWeek’s
1979 description of "the death of equities as a near permanent condition,
Michael Lewis, "The Evolution
of an Investor," Blaine-Lourd Profile, December 2007 ---
http://www.portfolio.com/executives/features/2007/11/19/Blaine-Lourd-Profile#page3
As quoted by Jim Mahar in his Finance Professor Blog at
http://financeprofessorblog.blogspot.com/
As a
group, professional money managers
control more than 90 percent of the U.S.
stock market. By definition, the money
they invest yields returns equal to
those of the market as a whole, minus
whatever fees investors pay them for
their services. This simple math, you
might think, would lead investors to pay
professional money managers less and
less. Instead, they pay them more and
more...Nobody knows which stock is going
to go up. Nobody knows what the market
as a whole is going to do, not even
Warren Buffett. A handful of people with
amazing track records isn’t evidence
that people can game the market. Nobody
knows which company will prove a good
long-term investment. Even Buffett’s
genius lies more in running businesses
than in picking stocks. But in the
investing world, that is ignored. Wall
Street, with its army of brokers,
analysts, and advisers funneling
trillions of dollars into mutual funds,
hedge funds, and private equity funds,
is an elaborate fraud.
Michael Lewis,
"The Evolution of an Investor,"
Blaine-Lourd Profile, December 2007
---
http://www.portfolio.com/executives/features/2007/11/19/Blaine-Lourd-Profile#page3
As quoted by Jim Mahar in his Finance
Professor Blog at
http://financeprofessorblog.blogspot.com/
"Smart Stops on the Web," Journal of Accountancy,
January 2008 ---
http://www.aicpa.org/pubs/jofa/jan2008/smart_stops.htm
PERSONAL FINANCIAL
PLANNING |
|
CENTER IN ON PFP SERVICES
http://pfp.aicpa.org
Want to offer financial
planning services to your
clients? Visit the AICPA’s
Personal Financial Planning
Center for PFP resources to
get you started. Click the
“Events” tab to register for
Web seminars, including “The
Mathematics of Estate
Planning” on Jan. 16, or
research the requirements
and application process for
the Personal Financial
Specialist credential. In
the upcoming months, the
section’s Executive
Committee will roll out a
suite of updated practice
guides on various PFP
technical and practice
management topics, available
to PFP Section members and
PFS credential holders at no
cost.
STRAIGHT FROM THE SOURCE
www.treasurydirect.gov
Individuals and financial
institutions can buy and
redeem Treasury securities,
including bills, notes, TIPS
and series I and EE savings
bonds, directly from the
U.S. Treasury at this Smart
Stop. Not confident enough
to invest yet? Enter the
“Individuals” or
“Institutions” sections, and
then use the “Research
Center” to access a glossary
of terms and in-depth
coverage of auctions and
products or to take a guided
tour of the site. There is
also a calendar of upcoming
Treasury auctions, as well
as auction regulations and
recent results.
STAY DEBT-FREE
www.moneycrashers.com
At this “Guide to Financial
Fitness,” author Erik
Folgate chronicles his
experience with getting into
and out of debt, providing
recent graduates and young
professionals with the
education needed to be
financially successful.
Follow the “11 Principles”
series, which includes tips
on saving money for the
unexpected and creative ways
to boost your income, or
read articles on financial
planning, such as “Don’t Let
Your Fears Stand in the Way
of Investing” and “Stay
Positive When Paying Off
Debt.” |
|
|
GENERAL INTEREST |
|
ERISA EDUCATION
www.dol.gov/elaws/ERISA/Fiduciary.htm
Developed by the Employee
Benefits Security
Administration, this site’s
fiduciary adviser provides
an overview of the basic
fiduciary responsibilities
applicable to private-sector
retirement plans under the
Employee Retirement Income
Security Act (ERISA).
Designed for accountants and
other third-party service
providers, the adviser uses
a series of questions to
determine whether a
retirement plan falls under
ERISA requirements, and if
so, what they are. This
Smart Stop also has a
comprehensive listing of
ERISA resources at
www.dol.gov/elaws/ebsa/fiduciary/resources.htm.
FLY HAPPY
www.yapta.com
Whether you’re planning a
vacation months in advance
or jetting off for a
last-minute business trip,
use Yapta as “Your Amazing
Personal Travel Assistant.”
Registered users tag their
desired or frequently
traveled flights, then are
alerted by e-mail when the
prices of those routes drop.
Already bought a ticket? If
you booked through an
airline’s Web site, submit
your confirmation code or
forward Yapta your
confirmation e-mail. If the
ticket price drops below
what you paid, the site will
let you know whom to call
and what to say to receive a
refund for the difference or
a travel voucher.
STUDENT INSIDERS
http://njscpa.typepad.com/examcram
What does it take to become
a CPA these days? Follow a
few New Jersey Society of
CPAs student members, who
are chronicling their
trials, tribulations and
triumphs on the society’s
Exam Cram blog. Browse the
archives to read Scott
Sandford’s journey as he
studied for and took the CPA
Exam while working at
Deloitte, or join the
NJSCPA’s new student
recruit, Priscilla Jenkins
of Merrill Lynch & Co. in
Pennington, N.J., as she
sits for part of the exam in
February. Also take some
time to read Tomorrow’s CPA,
a monthly
e-newsletter for accounting
students, written by
accounting students, on the
NJSCPA’s Students and
Educators site (www.njscpa.org/students).
GO GLOBAL
www.jimhamiltonblog.blogspot.com
Jim Hamilton, a principal
analyst at Wolters Kluwer
Law & Business and a leading
contributor to the CCH
Federal Securities Law
Reporter, emphasizes
SEC rulemaking,
international, federal and
state regulations, and
industry trends on his
“World of Securities
Regulation” blog. Under
“Tools,” click “Posts by
Topic” for a complete
listing of the blog’s
auditing, financial
reporting, Sarbanes-Oxley
and PCAOB coverage, or look
for new posts on
principles-based
regulations, the mortgage
lending market and
international issues.
—Megan Pinkston |
A Government Website for Helpers
in Personal Finance
MyMoney.gov is the U.S. government's
website dedicated to teaching all
Americans the basics about financial
education. Whether you are planning to
buy a home, balancing your checkbook, or
investing in your 401k, the resources on
MyMoney.gov can help you do it better.
Throughout the site, you will find
important information from 20 federal
agencies government wide.
My Money.gov ---
http://www.mymoney.gov/
The AICPA's Financial Literacy Helper
Site ---
http://www.360financialliteracy.org/
Bob Jensen's finance helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm
Annuity Buyer's Guide ---
http://www.annuitybuyersguide.com/
David Bach's "Latte Principle" ---
Click Here A Penny Saved Compounds to Much More Than a Dollar Earned
Jim Mahar provided the following two links:
"Penny's Add Up to Millions,"
Free Money Finance, October 15, 2007 ---
http://www.freemoneyfinance.com/2007/10/pennies-add-up-.html
Here's a post from
Yahoo Finance that details the author's
struggle with her husband to take his
lunch to work. But the essence of what
she says is really that saving/watching your pennies is the key
to wealth. Her
thoughts:
I'm
convinced that for the average
person who wants to build wealth,
pennies count.
Pennies
have a funny way of snowballing into
dollars, and then hundreds, and then
thousands, especially if you use
them to buy the stocks of
well-managed companies. Consider the
story of a parking attendant who
earns $20,000 a year but has amassed
a $500,000 equity portfolio. Or the
one about a group of New Yorkers who
managed to save for a down payment
on a (very expensive, very tiny)
piece of the Big Apple. Or the clan
of seven dubbed "America's cheapest
family," who paid off their mortgage
in nine years on a salary of $35,000
a year.
I've seen article after article bashing
David Bach's "Latte Principle" -- the
idea that if you save on small spending
you can amass a large amount of wealth.
The main argument against it is that
people should be paying attention to
large expenditures -- that's where the
real difference is made. But Bach isn't
saying to ignore the expensive decisions
in life. He's just aware that for many
of us there are small amounts we spend
every day without really thinking about
how much they end up costing us. And
that if we just limit a few of them and
save that money, we can save a good
amount throughout the years.
Continued in article
"How to Save a Bundle of Money,"
Free Money Finance, October 15,
2007 ---
http://www.freemoneyfinance.com/2007/10/how-to-save-a-b.html
Yahoo Finance has
a list of ten money drains along with the annual
costs of each of them.
I view this as a
list of where we all can save a bundle
of money. Here's their list as well as
the annual amounts spent on each of them
(in other words, what you could save if
you eliminated them):
1.
Coffee -- $360 per year. 2. Cigarettes -- $1,660 a year. 3. Alcohol -- $3,650 per year. 4. Bottled water from convenience
stores -- $365 per year. 5. Manicures -- $1,068 per year. 6. Car washes -- $348 per year. 7. Weekday lunches out -- $2,350 a
year. 8. Vending machines snacks -- $260
per year. 9. Interest charges on credit card
bills -- $4,868 in interest (over
time). 10. Unused memberships -- $480 per
year.
Now of course I wouldn't suggest that
someone cut out everything and eliminate
all of life's pleasures. After all, we
should use part of our money to enjoy
ourselves. But for those people out
there looking for a way to save a bit
extra, for those who simply "can't make
it on what I earn", and for those who
would simply like to pay down their
debt, this is a pretty good list to
consider cutting down on -- even if it's
for a short period of time. And you
don't have to eliminate each of the
items above, simply consider cutting
back on them. There's still tons of
savings available by cutting your car
washes, manicures, or alcohol
consumption in half.
And if these
aren't enough money saving ideas, check
out my list of ways to save money from
2005-2006 as
well as my 2007 list.
Jensen Comment Of course eliminating all the above would not necessarily be wise. If there's
five feet of snow on the ground, I'm not about to wash my own car. Yet getting
the car washed in winter is more important than in summer if you live where they
salt and sand the roads. Spending $358 each winter car washes may well save
thousands if you can, thereby, double the life of your car.
New cars
lose 60% of value in the first four years. Most people waste more money on cars and interest charges for car
financing than any other single cash drain in their lives, including the cost of
housing. Cars are a necessity of life for most of us who have no convenient
public transportation alternatives. But frequent trading in of good cars for new
cars is a monumental mistake in finance. Leasing is also a synonym for
stupidity. Insiders call it "fleecing
a car." But I'm grateful for ignorant people who are constantly turning in
good owned or leased cars. Most of the cars I've owned over the years were
turned back leased cars. Great mechanics put my previously-owned or
previously-leased vehicles back in top shape, and I save a bundle relative to
their prior owners. If you must finance your next vehicle, please be a smart
shopper and be informed how dealers cheat ---
http://faculty.trinity.edu/rjensen/FraudDealers.htm
I lived in San Antonio for 24 years where over
500 cars per month are stolen. See the video ---
http://www.youtube.com/watch?v=TQPSXCqBqz4 My answer was to buy an old car (usually a station wagon) and make it look even
less desirable to the thousands of car thieves cruising about San Antonio by day
and by night. Little did thieves know that underneath the hood was a new power
train and other features that made my old heaps just like new. I always remember
a comedy show that featured a company in Los Angeles that would ghettoize a new or relatively-new car to make it look like a junk yard dog. My city cars were like that. My
wife and I were more safe since our cars were of little temptation to
carjackers. But my children generally crouched down in the seats or asked to be
let out a block away so their friends would not see them in my cars.
Next to car financing, the biggest mistake most people make is credit card
financing to a point where they seldom zero out what they owe on credit cards.
This is the "dirty secret" of that makes credit card companies suck billions
upon billions of dollars out of the economy ---
http://faculty.trinity.edu/rjensen/FraudReporting.htm#FICO
When we're about to go on long trips, I overpay monthly expenses ahead of time
so that if we're delayed in returning home we never have to worry about being
charged interest or late payment penalties. For example, I put huge credit
balances into our credit card accounts before going on a long adventure.
Do I buy into David Bach's "Latte Principle?"
Well yes and no. I do not believe in Spartan living so I can watch my savings
grow for the sake of watching my savings grow. I don't drink latte, but I also
opt for four-star or five-star hotels or lovely country inns when my wife and I
are on adventures. Expensive restaurants are generally wastes of money, but we go to them
when the mood is right and/or the friends we're with prefer a top restaurant.
Often you can eat just as well in the hotel's lounge as in the expensive
restaurant down the hall. There's a huge difference between what you splurge for on daily (like credit
card interest and latte) versus what you splurge for infrequently. When I used
to come home at night and have a couple of drinks daily, I drank cheap Boca
Chico rum in my cubalibras. Now that I don't drink daily, I splurge on fine wine
and expensive liquor once in a while.
In the final analysis, I would have to say that I live better in retirement
because I pretty much followed the "Latte Principle" before it was called "Latte
Principle." Most of my travels in life were
financed by others who made me sing (lecture) for my supper, but I enjoyed
the fellowship and strokes of these types of trips more than I did boring
leisure vacations. I spent as much as I could possibly afford on land and
houses, but these generally returned more than I paid for them. I spent as
little as possible on cars and preferred to buy finely-tailored suits in upscale second hand shops
(look for Second Looks in San Antonio and Austin).. I think most of the former owners
of my suits had passed on in life.
I never argue with my wife over money even when she tips almost as much as
the check itself. I never object when she hands out ten dollar bills to
receptionists, postal clerks, trash haulers, window washers, and bell
ringers outside the Wal-Mart stores. She's thrifty but likes a lot of new things
she generally buys on sale. She seldom shops in stores. But the UPS truck stops up here in the mountains
nearly every day. While my wife is wearing the "8" and "0" buttons off on phone in our den
(mostly she orders gifts), I'm on the computer ordering everything from books to
groceries to space heaters from Amazon.com (a great, great place to shop). Our UPS driver's name is
Joe, and if I'm not at home he comes into the basement and assembles what he's
just delivered. Will your UPS driver do that?
I truly got my money's worth out of faculty clubs. I would've joined
expensive country clubs but I never had time for a round of golf even once a
week. Such is the price one pays for being a workaholic.
It's easier for a workaholic to live by the "Latte Principle." But most of us
workaholics are doing what we like best.
October 17, 2007 reply from Barbara Scofield
[scofield@GSM.UDALLAS.EDU]
When my husband was in training to be a police
chaplain, the trainer began talking about the issue of stolen cars by
pointing to my husband and saying, “What kind of car do you drive?” Rob, my
husband, responded, “A ’99 Saturn wagon.” The police trainer told him, “You
can leave the keys in your car.”
Barbara W. Scofield, PhD, CPA
Investment Theory versus Practice:
What are volatility "smiles" versus "smirks"?
From the Financial Rounds Blog on
April 28, 2008 ---
http://financialrounds.blogspot.com/
Informed Traders and Options Markets
If you were an informed trader,
would you trade in the options
market or in the market for the
underlying asset? Finance theory
says you'd trade in the options
market because of increased
leverage.
Now here's another paper that
supports this idea. In their March
2008 paper Xiaoyan Zhang, Rui Zhao
and Yuhang Xing look at whether
relatively expensive put options can
be used as "bad news" indicators.
Here's the abstract of their paper:
The shape of the volatility
smirks has significant
cross-sectional predictive power
for future equity returns.
Stocks exhibiting the steepest
smirks in their traded options
underperform stocks with the
least pronounced volatility
smirks in their options by
around 15% per year on a
risk-adjusted basis. This
predictability persists for at
least six months, and firms with
steepest volatility smirks are
those experiencing the worst
earnings shocks in the following
quarter. The results are
consistent with the notion that
informed traders with negative
news prefer to buy
out-of-the-money put options,
and that the equity market is
slow in incorporating the
information embedded in
volatility smirks.
Read the whole thing here. ---
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1107464
In case you're not familiar with the
term, the volatility "smile" refers
to the phenomenon that implied
volatility increases for options
that are further out of the money.
If the increase in implied
volatility is greater on one side
than on the other, the pattern is
known as a volatility "smirk". In
the case of this paper the smirk is
used as an indicator of the degree
to which puts or calls are
relatively expensive. For example,
if calls are relatively more
expensive, that is taken as an
indicator that informed traders have
been buying calls because they have
positive information about a stock,
with expensive puts being an
indicator that traders possess bad
news.
In addition to predicting subsequent
returns, the authors also find that
firms with the most expensive put
options are more likely to have the
worst negative earnings shocks in
the following quarter.
All in all, a pretty cool paper that
indicates how information from one
market can predict movements in
another.
Jensen Comment
Do you suppose that Sony's Camera's new
frown-fixing tool (called
Happy Face Retouch) can be pointed
at a volatility graph and turn a smirk
into a smile?
Bob Jensen's investment and personal
finance helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Question What are 120-20 and 130-30 funds?
These
funds are called 120-20 or 130-30 funds, reflecting their proportion of
assets held long and sold short, with the proceeds from the short sales
used to leverage the long position with borrowed funds, so that the long
exposure is more than 100 percent. “The idea seems to have caught on,”
said Barry P. Barbash, a Washington lawyer who once headed the
investment management division at the Securities and Exchange
Commission. “Public funds using this strategy seem to be multiplying
almost daily.” Robert D. Hershey, Jr., "This Fund Concept Blurs Old Lines," The New
York Times, July 8, 2007 ---
Click Here
"Twenty-Five Ways to Reduce
Investment Risk," The Aleph Blog , July 21, 2007 ---
http://alephblog.com/?p=186
The Aleph Blog (Helping
Institutions and Ordinary People Invest Better by Focusing on Risk
Control) --- http://alephblog.com/
From Smart Stops on the Web,
Journal of Accountancy, July 2007 ---
http://www.aicpa.org/pubs/jofa/jul2007/news_web.htm
WEALTH MANAGEMENT |
|
SECURING A
REPUTABLE BROKER www.nasd.com/brokercheck
The NASD has answered the calls of investors looking for
background information on potential financial service
providers. The organization’s BrokerCheck Program lets users
research current or formerly registered securities firms,
individual brokers and regulated Investment Adviser firms.
It also provides a comprehensive 10-year business and
licensure history and list of disclosure events, including
criminal actions, customer complaints and disciplinary
actions by regulators against the firm or broker. Investors
receive an electronic disclosure report as well as access to
other educational services, including the Professional
Designation Database and state disclosure programs.
BECAUSE
YOU’RE WORTH…MORE www.freemoneyfinance.com
Whether you’re living on a student’s budget or a CFO’s
salary, Free Money Finance has innovative ideas for
increasing net worth, budgeting and maximizing retirement
savings that you can immediately put into practice. On
Mondays, check out “Star Money Articles,” a posting of news
and tips from several of the Web’s popular personal finance
sites. Take a few minutes on Fridays to read “One Year Ago,”
popular posts from the prior year, to jump-start a frugal
weekend.
THE
BENEFITS OF TAX KNOWLEDGE www.irs.gov/retirement
Visit this Smart Stop for the latest
tax news and information affecting the employee plans
community. CPAs can search for resources on employee plans
(EP) examinations and enforcement, retirement plans, benefit
audits and correcting EP errors. Click on the
“EP/Forms/Pubs/Products” link for access to PDF versions of
EP forms and publications, plus in-depth instructions for
form 5500, Annual Return/Report of Employee Benefit Plan,
and form 5330, Return of Excise Taxes Related to
Employee Benefit Plans.
NOTHING IS CERTAIN
BUT… www.deathandtaxesblog.com
Visit Chicago-area attorney Joel
Schoenmeyer’s Web site to brush up on topics straddling the
lines between law, accounting and wealth management. Death
and Taxes—The Blog offers estate planning and administration
news and commentary, plus coverage of legal issues about
real estate, gift and income taxes, trusts and charitable
giving. |
Naked Shorts: Irreverent Investment Ideas
---
http://nakedshorts.typepad.com
Corporate Financial Reports O'Keefe Accounting Library Searches
http://library.sau.edu/bestinfo/Majors/Accnt/accindex.htm
Advertisement Free
Personal Finance Blogs ---
http://pfblogs.org/blog/29
Mortgage Professor's Tips on Whether or Not to Pay
Off Your Mortgage Early ---
http://www.mtgprofessor.com/early_payoff.htm
How Mortgages Work ---
http://money.howstuffworks.com/mortgage.htm
The AICPA's Financial Literacy Helper Site ---
http://www.360financialliteracy.org/
What are current mortgage rates? ---
http://biz.yahoo.com/b/r/m.html
Lord Help Us!
Stockpickr has a list of
the Top 100 Business Blogs
Damodaran Online: A Great Sharing Site from a Finance Professor at New
York University and Textbook Writer ---
http://pages.stern.nyu.edu/%7Eadamodar/
Jim Mahar's finance sharing site (especially note his great
blog link) --- http://financeprofessor.com/
Financial Rounds from an anonymous finance professor ---
http://financialrounds.blogspot.com/
Beware of the So-Called Investor Education Programs (especially beware of
infomercials) "I don't see frankly much out there that really does
the job, and that's partially because investors are their own worst enemy," says
former SEC Chairman Arthur Levitt. "They refuse to invest skeptically, and are
too easily seduced by all the purveyors of financial products that prey upon
their worst instincts." "Investor Education 101: How to Avoid Scams: Outreach Programs
Target Most-Vulnerable Americans, But Success Is Hard to Assess," By Lynn
Cowan, The Wall Street Journal, May 9, 2006; Page D3 ---
http://online.wsj.com/article/SB114713241888747241.html?mod=todays_us_personal_journal
The Invisible Problem of
Risk Blindness," by
Kevin Dowd, Financial Engineering News, November 2006 ---
http://www.fenews.com/fen52/risk-reward/risk-reward.html
Help for the younger generation's planning ahead for their
financial futures "A Glimpse of the Future: Savings and asset accumulation among
Americans 25–34," Journal of Accountancy, January 2007 ---
http://www.aicpa.org/pubs/jofa/jan2007/special2.htm
Also see
http://faculty.trinity.edu/rjensen/fees.htm
Are Hedge Funds Out of Control?
(from the
University of Pennsylvania's Wharton School
Click Here
Foreign Direct Investment (FDI) in the U.S. ---
http://www.fdi.net/
"Are You Saving Enough for
Retirement? A Guide to Figuring It Out and Funding It," by Jonathan
Clements, The Wall Street Journal, July 12, 2006; Page D1 ---
http://online.wsj.com/article/SB115265948927403942.html?mod=todays_us_personal_journal
So what's your
personal liability and how can you trim it? Brace yourself: We're in
for some scary math.
• Bridging the
gap. "Corporate accounting requires companies to look at their
pension obligations, to use reasonable assumptions and to fund
those obligations on an annual basis," notes Charles Farrell, a
financial consultant in Medina, Ohio. "A little bit of that
corporate discipline can be helpful on the individual side."
Mr. Farrell's
advice: Start by deciding how much income you will need from your
portfolio to supplement whatever you expect from Social Security and
any pensions you're entitled to. Next, multiply your desired
portfolio income by 20, to get the target size of your retirement
nest egg. (This assumes you use a 5% withdrawal rate in the first
year of retirement, and thereafter step up your withdrawals with
inflation.)
For instance,
if you're looking to garner $40,000 in initial retirement income
from your portfolio, you would need $800,000 saved. Let's say you
have $300,000 salted away. That means your current unfunded
retirement liability is $500,000.
To find out how much you need to save each
month to amass this $500,000, head to
www.dinkytown.net
and call up the savings-goal calculator. One problem: Thanks to
inflation, your target retirement income and your required savings
could be whole lot bigger by the time you quit the work force. What
to do? Mr. Farrell suggests thinking in terms of after-inflation
"real" rates of return.
To that end,
when using the dinkytown.net calculator, set inflation at zero and
input what you think your annual return will be, over and above
inflation. If your portfolio includes a decent helping of stocks and
you're careful about investment expenses, you might opt for a 4%
real return.
Finally, enter
your portfolio's value, your current monthly savings and your time
horizon. The calculator will then tell you how much you really need
to save each month to accumulate your desired nest egg. But here's
the key: To combat inflation and ensure you have enough at
retirement, you will need to increase your monthly savings along
with inflation.
• Raising the
price. Does your required savings rate seem a little steep? If
anything, you should probably be socking away even more, for two
reasons.
First, many
financial planners consider a truly safe withdrawal rate to be 4.5%
or even 4%. That means you ought to amass as much as 25 times your
desired $40,000, boosting your retirement liability to $1 million.
This is
clearly news to a lot of ordinary investors. According to a study
recently conducted for insurer New York Life, 40% of those surveyed
weren't sure how much they could safely withdraw from a portfolio --
and an additional 29% thought that a safe retirement withdrawal rate
was 10% or more. "There's a pretty big gap between expectations and
reality," says Ted Mathas, chief operating officer at New York Life.
Second, while
you might want only $40,000 a year in portfolio income, you should
be prepared to spend as much as $74,095 per person. That's the
national average cost for a private nursing-home room, according to
insurer MetLife's Mature Market Institute. In fact, if both you and
your spouse need care at the same time, you could have to fork over
some $150,000 a year.
Assuming you
get $20,000 a year from Social Security, your out-of-pocket cost
might be $130,000. Based on a 5% withdrawal rate, that means you
need $2.6 million socked away. How's that for a retirement
liability?
"Long-term
care is a huge potential cost," Mr. Farrell says. "If you're not
rich enough to self-insure, you've got to think about buying a
long-term-care policy that gives you at least minimal coverage."
• Trimming the
tab. A long-term-care policy is one way to dial down your unfunded
retirement liability.
What else can
you do? To squeeze more retirement income out of your assets, you
could take out a reverse mortgage and use maybe 25% or 50% of your
savings to buy an immediate-fixed annuity that pays lifetime income.
In addition,
"you could try to lower your fixed costs," Mr. Farrell says. "A
smaller house is better, because that should lower your property
taxes and lower your utilities. You might also want to reassess how
many cars you have."
Of course,
cutting back isn't easy. "Try to downscale before you retire, to see
if you're comfortable with that," Mr. Farrell suggests. "If you're
not, you might want to retire a little later."
Postponing
retirement -- unpalatable as it seems -- can transform your chances
of a comfortable retirement. By delaying, you will have more time to
save and more time for your investments to grow. You will also
shorten your retirement, so you can be more aggressive in spending
down your nest egg.
As an added
bonus, delaying retirement will allow you to postpone taking Social
Security and purchasing an immediate annuity. Result: When you start
Social Security and when you buy your annuity, you will get even
more income.
Investment Helpers From the
Journal of Accountancy January 2007 Smart Stops on
the Web ---
http://www.aicpa.org/pubs/jofa/jan2007/news_web.htm
Onward and Upward
www.mynextphase.com
Here CPAs and financial advisers can get a free trial membership and
explore some of the nonfinancial considerations of retirement, such
as how to handle change and revisit past interests as future
options. Retirement Resources has links to Web sites on health,
recreation and working after retirement. Find books on successful
retirement in Suggested Reading, get the free newsletter Next
Phase News and download research findings in “Retirement Trends
and Truths.”Get the
Financial Facts http://kimsnider.blogs.com
This blog, created by the founder and president of Kim
Snider Financial Communications, has dozens of posts from financial
journals and Web sites on topics including annuities, bonds, cash
flow investments, financial education and investment principles.
Find out how Kim Snider invests her own money and learn her
portfolio management strategies with a free informational session.
A Helping Hand
www.finaid.org
Personal financial planners with clients that have kids in school
will want to bookmark this Smart Stop for guides on navigating
financial aid, loan and scholarship information. Find links to aid
programs from the military and federal and state governments, as
well as resources on education tax benefits and financial aid
applications. Get calculators to project college costs and help with
family budgeting. Or go to Beyond Financial Aid for a financial aid
checklist and links to college selection and jobs and internship
sites.
Money Matters
www.pfblog.com
Follow this blogger’s personal finance journey to learn about the 10
best domestic equity fund managers and how to properly close a
credit card account. Look up your life expectancy in the Archives or
go to the PFBlog Digest to get the scoop on paying off student
loans, starting salaries for college grads and how 529 plans affect
financial aid eligibility.
Make a Clean Break
www.womansdivorce.com
Financial advisers looking for divorce resources for female clients
can go to this site’s Downloadable Documents section for
state-specific divorce forms, parenting, separation and property
settlement agreements. The Legal Considerations for Women and
Financial Information sections offer divorce strategies and advice
on choosing an attorney.
From 'Smart Stops on the Web', Journal of Accountancy,
December
2004, Page 29 --- http://www.aicpa.org/pubs/jofa/dec2004/news_web.htm
SMART
STOPS ON THE WEB |
Back to Basics
mutualfunds.about.com
CPAs looking for a refresher course on mutual
funds will find articles such as “Determining Your Mutual
Fund’s ‘Cost Basis’” and “Avoiding Internet Investment
Scams.” Users can sign up for a free 10-day online course on
the basics of mutual fund investing or a mutual fund newsletter.
Other resources include links to broker ratings of funds,
financial calculators and glossaries.
The Fund Finder
www.mutualfundsnet.com
CPAs looking for investment information for
their clients will want to bookmark this Web site. In addition
to free mutual fund sponsor searches in categories such as
socially responsible corporate and government mutual funds,
users can find information about investment conferences and
links to breaking industry news. CPA broker-dealers can add
their resumes to the database or check job postings from listed
companies.
For Fund Facts
www.mfea.com
Investment advisers looking to educate their
clients on mutual fund options will find detailed information on
topics including taxes and fund risk at this stop on the Web.
Users can find explanations of the differences among mutual
funds and a glossary of investment terms or search for funds,
create model portfolios or use calculators for college,
retirement and tax-savings plans.
The Kids and College section of this Web stop links to sites
that offer investment resources for money-minded children, such
as calculators to help them decide how much allowance to save
for major purchases and a dictionary of basic investment terms.
Satisfy Your Need to Know
www.ici.org
Here visitors can find free statistics on money
market mutual fund assets or reports on the latest industry
developments, such as “SEC changes SRO Procedures for Filing
Rule Changes.” Other sections include A Guide to Understanding
Mutual Funds, Frequently Asked Questions and a news archive
dating back to 1995.
Keep Track of the Market
www.123jump.com
Users can register for free to keep tabs on
their mutual funds at this e-stop, which offers general
business, current and archived earnings news, as well as
QuoteStream to see how your picks measure up on the Nasdaq, NYSE
and S&P 500 stock index. Visitors also can get two daily
e-mail newsletters, Earnings Ticker and Ticker
AM—Business News Update. |
From Smart
Stops on the Web, The Journal of Accountancy, May 2006 ---
http://www.aicpa.org/pubs/jofa/may2006/news_web.htm
Invest Time for a Laugh
www.dailyreckoning.com
Who says researching investment information can’t be fun? At this Web
site, visitors not only get the latest market headlines and insights,
but also some laughs. For example, the Essentialist Glossary in the
Extras section defines Bill Gates as “where God goes for a loan.” Users
also can read special reports on investing in India or value-investing
strategies, subscribe to the free Daily Reckoning financial
e-letter or get five secrets for investing in small- and micro-cap
stocks.
-
-
-
October 13, 2006 message
from Dan Blystone (no relation to Trinity University's Bob Blystone)
Dear
Bob,
I am
writing to request that you kindly consider adding a link to my
website (TradersLog.com) on your page here:
http://faculty.trinity.edu/rjensen/bookbus.htm
I think
your visitors may find it useful and interesting, and it would
help my startup gain some valuable exposure.
The
website description is: Portal website for traders and investors
featuring articles, analysis and a community forum.
Please
let me know if you have any questions.
Best
Regards,
Dan
Blystone TradersLog.com (312) 593-1322
Reply from Bob
Jensen
Hi Dan,
I added
your message to
http://faculty.trinity.edu/rjensen/Bookbus.htm
However, I
think I have some better places to also add your message. It
will be in the forthcoming (October 31) edition of New
Bookmarks.
I have
added your link to my investor helper module at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Since you
provide a great set of links to economic and financial
statistics, I also added your link at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#EconStatistics
Best of
luck in your venture.
Bob Jensen
|
A deep interest in numbers and finance and a desire to help the
average investor led Eric Tyson, MBA '89, to write a series of
"Dummies" books in areas about personal money management.
http://www.gsb.stanford.edu/news/bmag/sbsm0311/feature_tyson.shtml
Top Online Brokers, Barron's, March 10, 2003, Page
24
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Range of Offerings |
Research Amenities |
Reports and Customer Access |
Costs |
Weighted Total |
Star Rating |
optionsXpress |
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4.3 |
4.5 |
4.6 |
4.1 |
4.0 |
26.5 |
****1/2 |
TradeStation |
5.0 |
4.0 |
3.9 |
4.5 |
4.0 |
4.5 |
25.9 |
**** |
Terra Nova |
4.8 |
3.8 |
3.8 |
3.8 |
4.6 |
4.0 |
25.2 |
**** |
Ameritrade Apex |
4.0 |
4.5 |
3.7 |
4.6 |
4.1 |
3.3 |
24.6 |
**** |
Wall St.*E |
4.5 |
3.0 |
4.8 |
3.4 |
4.2 |
4.5 |
24.3 |
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Wall St. Access |
3.7 |
4.5 |
4.8 |
3.9 |
3.3 |
3.0 |
23.5 |
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SieberNet |
3.8 |
4.2 |
3.6 |
4.1 |
4.2 |
3.0 |
23.4 |
**** |
CyBerTrader |
4.7 |
4.0 |
2.5 |
4.2 |
3.9 |
3.5 |
23.2 |
**** |
E*Trade
(Power) |
3.4 |
3.0 |
4.2 |
4.2 |
4.3 |
3.1 |
22.6 |
***1/2 |
Harrisdirect |
3.6 |
3.5 |
4.5 |
4.4 |
3.7 |
1.9 |
22.5 |
***1/2 |
Fidelity |
3.4 |
3.5 |
4.3 |
3.7 |
4.4 |
2.0 |
22.3 |
***1/2 |
Charles Schwab |
3.4 |
3.7 |
4.1 |
4.4 |
4.2 |
0.4 |
21.9 |
***1/2 |
Scottrade |
3.8 |
3.8 |
3.5 |
3.7 |
3.2 |
4.0 |
21.8 |
***1/2 |
E*Trade (Standard) |
2.5 |
4.0 |
4.0 |
4.2 |
4.4 |
1.6 |
21.6 |
***1/2 |
Interactive Brokers |
4.3 |
3.7 |
3.0 |
2.7 |
3.3 |
4.9 |
21.4 |
***1/2 |
Preferred Trade |
4.8 |
3.7 |
3.4 |
2.4 |
3.1 |
3.9 |
21.3 |
***1/2 |
myTrack |
4.0 |
3.5 |
3.2 |
3.6 |
3.5 |
3.0 |
21.2 |
***1/2 |
MB Trading |
4.3 |
3.6 |
3.3 |
2.7 |
3.5 |
3.5 |
21.1 |
***1/2 |
TD Waterhouse |
3.0 |
3.0 |
4.6 |
3.4 |
3.7 |
3.1 |
20.9 |
***1/2 |
Brown & Co. |
2.7 |
2.5 |
3.3 |
2.6 |
2.6 |
5.0 |
17.5 |
*** |
Brokerage America |
1.7 |
3.5 |
3.1 |
3.0 |
2.6 |
5.0 |
17.5 |
*** |
JB Oxford |
3.1 |
2.5 |
3.5 |
2.0 |
2.7 |
3.4 |
17.0 |
*** |
Vanguard |
2.7 |
3.1 |
2.8 |
2.4 |
3.3 |
1.4 |
16.5 |
**1/2 |
Merrill Lynch Direct |
2.2 |
2.7 |
3.0 |
3.8 |
3.0 |
0.7 |
16.4 |
**1/2 |
American Express |
2.9 |
3.7 |
2.3 |
3.0 |
1.8 |
2.2 |
16.0 |
**1/2 |
Strong Funds |
1.4 |
3.6 |
2.5 |
3.1 |
2.7 |
2.8 |
15.7 |
** |
Firstrade |
2.2 |
2.5 |
2.6 |
2.5 |
2.5 |
3.8 |
15.4 |
** |
Quick & Reilly |
2.2 |
2.4 |
3.3 |
3.2 |
2.4 |
1.3 |
15.3 |
** |
|
|
Student Loans: What You Need to Know Before
Signing ---
http://www.journalofaccountancy.com/issues/2017/jan/student-loan-repayment.html?utm_source=mnl:cpald&utm_medium=email&utm_campaign=09Jan2017
How little couples talk about money.
It’s probably one of the last taboos
except in heated arguments after it's
too late.
Suggestions for improving
communications with partners about money
http://www.forbes.com/sites/johnwasik/2016/09/16/how-much-do-you-need-for-retirement-communication-is-the-key/#558a3fc514eb
Jensen Comment
I found the best way to communicate
about money with Erika was to let her
take over the checkbook years and years
ago even before we retired. That way
when I talked about long-range planning
her knowledge of the short-range ins and
outs made her much more sympathetic and
understanding about the long run. In the
short run, however, she still won't tell
me how much money is in the account ---
in fear that I might spend too much
foolishly if I know how much is
available. She let's me carry one check
in my billfold --- but that's strictly
for emergencies.
And what a relief it was to put bill
paying out of my mind.
Erika actually reconciles the checkbook
to the penny which is something that I
rounded off to the nearest $100 give or
take another $100. This task is
difficult for her since, as a surgical
nurse by training long before computers,
she does not even use a calculator let
alone a computer. She was very good at
counting sponges and sometimes had to
tell the surgeon that a sponge was
unaccounted for and must still be hidden
in the body. One time a surgeon ignored
her. Three weeks later he had to go back
into the patient's body to look for the
(now infected) sponge.
20 Rules of
Personal Finance ---
http://awealthofcommonsense.com/2016/12/20-rules-of-personal-finance/
From the CPA Newsletter on November 19,
2015
US ranks 14th in
world for financial literacy
http://www.forbes.com/forbes/welcome/
The
US ranked 14th in a survey of global
financial literacy that was
conducted in more than 140
countries. The researchers asked
multiple-choice questions about
topics such as interest and
diversification. Only 57% of
Americans received a passing grade.
Find the AICPA's financial education
resources at
360financialliteracy.org.
Forbes
(11/18)
Still, there’s little to celebrate from
Bankrate’s survey of banks. To make sure you’re not hit with egregious ATM
fees, here are three simple ways to avoid them
---
http://time.com/money/3433402/how-to-avoid-atm-fees/
Finance Tips from
The Math Dude Blog ---
http://www.quickanddirtytips.com/
These my be especially interesting when
teaching financial literacy modules
is a credit card
APR and how is it
calculated?" A. APR
is short for Annual Percentage Rate,
... which is the interest you’re
charged over a 12-month period. For
instance, a card with 24%
APR costs 2% ... a
single account can have several
different
APRs. The card
company may charge one rate for
purchases, one ...
By Laura Adams, MBA,
Money Girl
- December 18, 2013
a higher rate of interest.
Understand APY vs.
APR Speaking of
interest, there are two main ways
that ... interest is expressed for
CDs: APY and
APR. APY stands for
annual percentage yield and it’s the
rate you’d ... APY is the rate
you’ll get if you never withdraw
interest from a CD.
APR, on the other
hand, stands ...
By Laura Adams, MBA,
Money Girl
- February 10, 2011
Jensen Comment
CD's have very lousy investment
returns since the Federal Reserve
drove interest rates to almost zero.
In general these days you have to
take on more risk to get better
returns.
transfer card with 0%
APR for 12 months,
no annual fee, no balance transfer
fees, plus cash back rewards. ...
APR after the 0%
APR 12-month
promotion period expires. If she
continues to make $500 monthly ...
By Laura Adams, MBA,
Money Girl
- January 08, 2012
a lower interest rate, you can save
a lot of money. The Discover® More
Card gives you 0%
APR for 15 months
... Lending Club or Prosper —where
you can borrow for as little as
6.59% and earn an average of 10.59%
APR ...
By Laura Adams, MBA,
Money Girl
- June 02, 2012
typically charged a daily rate
that's equal to the card's annual
percentage rate (APR)
divided by ... 365. For instance,
the
APR for new
purchases could be 11.99%, cash
advances 23.99%, and balance ...
By Laura Adams, MBA,
Money Girl
- December 01, 2011
Jensen Comment
Make every effort to pay more each
month than what the credit card
billing says is the "minimum"
amount.
Better yet always take the monthly
amount due down to zero to avoid
interest charges altogether.
6.
card debt of $6,000. The
APR (annual
percentage rate) on my card is high
at 17% and I'd love to ...
By Laura Adams, MBA,
Money Girl
- December 21, 2010
8.
Otherwise, after the promotion ends,
the annual interest rate or
APR usually
skyrockets on your outstanding ...
By Laura Adams, MBA,
Money Girl
- September 26, 2013
transfer at 0%
APR for a limited
time. Should I transfer the balance
of my higher-interest card and save
... a balance transfer card, look
for the following features: an
introductory interest rate of 0%
APR for ...
By Laura Adams, MBA,
Money Girl
- December 18, 2012
The Khan Academy also has some
great personal finance tutorials ---
https://www.khanacademy.org/economics-finance-domain/core-finance/investment-vehicles-tutorial
Bob Jensen's threads on personal
finance ---
http://faculty.trinity.edu/rjensen/bookbob1.htm#InvestmentHelpers
Helpers for Student Loan
Forgiveness and Cancellation ---
https://www.moneygeek.com/education/college/resources/student-loan-forgiveness-cancellation/
Jensen Comment
If you do not qualify for student loan
forgiveness you should probably compare
your current annual loan payments with
payments if you privately refinance at
the present low interest rates. However,
you may lose some protections and
options in doing so. Be careful about
refinancing that sounds too good to be
true. You might be able to refinance
with your parents in a win-win situation
if your parents consider you a good
investment risk and you pay a higher
interest rate than their safe investment
alternatives. Read that as meaning you
have a good job in a good profession and
are not an unemployed aspiring artist or
writer or getting a Ph.D. in a
discipline where Ph.D. graduates are a
dime a dozen.
Whether or not you pay your student
loan off aggressively by making above
the minimum amounts due each year
depends much upon what you would
otherwise do with the money. Savings
rates are so low that you are probably
better off paying the loan off
aggressively relative to saving. Risky
investments are not the same as
gambling, but you should probably be
very cautious with putting money into
risky investments like tech stocks until
you have your student loans paid off.
Also remember that there are
transactions costs for buying and
selling land, houses, and stocks.
Short-term ownership (called flipping)
of a house/condo is risky unless the
buying deal was very good in a very hot
housing market such as near a college or
medical center. It helps in house
flipping markets if you do the fixing up
of a house yourself.
My advice is to avoid buying new cars
until your loan is paid off, although
you may have to invest in a quality
pre-owned car or lease modest cars at
low rates. Think public transportation
if you live in an urban area that has
good public transportation. You can
always rent an occasional car if needed
for a trip.
"Why Land and Homes Actually Tend
to Be Disappointing Investments," by
Robert J. Schiller, The New York
Times, July 15, 2016 ---
http://www.nytimes.com/2016/07/17/upshot/why-land-may-not-be-the-smartest-place-to-put-your-nest-egg.html?_r=1
Jensen Comment
This article is yet another example of
how to mislead with statistics. Making
money in land parcels and homes is
exactly like making money in the stock
market --- you've got to have picked the
right ones to put into your portfolio. I
sold an Iowa farm that more than doubled
in value after I sold it. One reason was
the idiotic decision to subsidize corn
farmers by requiring upwards of 10% corn
ethanol in every gallon of gas. North
Dakota farmers made a lot of money
selling oil rights. Owners of condos in
Manhattan and San Francisco made small
fortunes on tiny bits of property.
Houses purchased for less than $50,000
in 1980 in Silicon Valley may be worth
more than $5 million in 2016.
But what looks like good deals in
stocks and real estate in hindsight is
just that --- hindsight! There are no
guarantees of high returns without
taking risks unless you are in the Mafia
where you can force your own returns.
Expectations of higher returns means
acquiring more financial risk for most
of us.
There are some serious advantages to
investing as much as you can in a home
when you anticipate owning it for more
than 10 years. Firstly, you get the
added non-financial enjoyment of living
in a wonderful home. Secondly, there are
some tax breaks for the the 50% of
taxpayers that really pay taxes. But
there are a drawbacks. Property taxes
are the primary way the USA funds its
K-12 schools as well as pay for county
and municipal services. In most
instances growth rates for property
taxes outpaced the capital gains since
the real estate bubble burst in 2007.
There are also some wonderful
instances where owners have successful
rental properties such as owning a
duplex where the rent from one half of
the house pays all the expenses of the
entire house. A friend of mine, Tom
Selling, says that when he moved from
Dartmouth it was a good decision to
continue to rent his condo rather than
sell it at the time. That is probably
true of nearly all rental property close
to college campuses if the property was
purchased before the real estate bubble
burst in 2007. There are some tax breaks
of rental housing such as depreciation
and maintenance expense write-offs. For
example, half the cost of the roof on a
duplex might be expensed.
Don't get carried away investing in
land that has no serious annual cash
inflow. Of course there are exceptions,
but in general the taxes and maintenance
fees (e.g., mowing) plus the eventual
cost of selling the land take all the
fun out of trying to eventually make a
profit.
With bank savings deposits earning
virtually zero interest it's tempting to
take on more financial risks with your
savings. Each investor is unique. I
advise getting "free" advice from
reputable mutual funds like Vanguard or
Fidelity or TIAA. I don't advise paying
dearly for it at your local investment
advisor service. Find out the range of
alternatives from long-term tax exempt
mutual funds to diversified real estate
fund to a varity of long-term and short
term equity alternatives. Learn enough
to become your own adviser.
Bob Jensen's helpers for investors
(free because that may be more than
they're worth) ---
See Below
Home Equity Loan ---
https://en.wikipedia.org/wiki/Home_equity_loan
From the
CFO Journal's Morning Ledger on August 12, 2016
Home equity loans come back to haunt
borrowers, banks
The bill is coming due for many
homeowners on a type of loan that
was widely popular in the run-up to
the housing bust, causing a rise in
delinquencies at banks. More
homeowners are missing payments on
their home-equity lines of credit,
or Helocs, a type of loan that
allows borrowers to withdraw cash
from their house to pay for
renovations, college tuition or
almost any other expense. These
loans typically require
interest-only payments for the first
10 years, but then principal
payments kick in for the next 15 or
20 years. Borrowers who signed up
for Helocs in early 2006 were at
least 30 days late on $2.8 billion
of balances four months after
principal payments kicked in this
year, according to
Equifax Roughly 840,000 Helocs
taken out in 2006 are resetting this
year, with principal payments on an
additional nearly one million loans
expected to hit in 2017.
Alliance for Financial Inclusion
(financial literacy initiative funded by
Bill and Melinda Gates) ---
http://www.afi-global.org/
Tips on Personal Finance ---
http://twitter.com/EverydayFinance
Helpers in planning for retirement ---
http://www.plan-for-retirement.com/
Personal Financial Helpers:
From the Virginia Society of CPAs ---
http://www.vscpa.com/Financial_Fitness/
Wharton Professor Olivia Mitchell on
Worldwide Financial Literacy
http://www.ssga.com/definedcontribution/docs/Olivia_Mitchell_GlobalFinancialLiteracy_SSgADC_The
Participant02.pdf
Thank you Jim Mahar for the heads up.
Education: Federal Reserve Bank of
Kansas City ---
http://www.kansascityfed.org/education/
Note the Financial Fables section ---
http://www.kansascityfed.org/education/fables/index.cfm
A Guide to College Savings Plans ---
http://www.moneygeek.com/education/college/resources/college-savings-plans-guide/
Bob Jensen's helpers in personal finance
---
http://faculty.trinity.edu/rjensen/bookbob1.htm#InvestmentHelpers
Video: Investing for Inflation ---
http://www.simoleonsense.com/janet-tavakoli-author-of-dear-mr-buffett-on-investing-for-inflation/
What five classic Disney movies can
teach us about personal finance ---
http://www.csmonitor.com/Business/Saving-Money/2014/0904/What-five-classic-Disney-movies-can-teach-us-about-personal-finance
U.S. Social Security Retirement
Benefit Calculators ---
http://www.socialsecurity.gov/estimator/
Mutual Funds: 10 questions to test your
IQ (ten answers every investor should
know by heart) ---
http://www.azcentral.com/business/consumer/articles/2009/04/10/20090410biz-MutualFundsQuiz0410.html
The London Stock Exchange, one of the
UK’s top financial institutions – has
recently revamped its website (
www.londonstockexchange.com )
to expand its user-base. A wealth of
useful financial information can be
accessed on the new site, such as live
share and stock prices, charts, indexes
including FTSE 100 index, listed
companies and financial news. As well as
the global financial shares and trading
markets, users can also keep up to date
with the UK stock market by taking
advantage of the many new additions to
the website.
"Lack
of Financial Literacy Complicates
Student-Aid Process, Report Says,"
by Allie Bidwell, Chronicle of Higher
Education, May 13, 2013 ---
http://chronicle.com/article/Lack-of-Financial-Literacy/139223/
Bob Jensen's advocacy of putting
financial literacy in the common core
---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm#FinancialLiteracy
The Washington Post's New Personal
Finance Service ---
http://www.washingtonpost.com/business/get-there/
This Sneaky Retailer Trick Could
Cost You Hundreds of Dollars ---
http://time.com/money/4578471/retailers-deferred-interest-deals/?xid=newsletter-brief
Social Security Administration ---
https://www.ssa.gov/
This site has a reasonably good search
engine
"Here's when you should start
claiming your Social Security benefits,"
by Ben Carlson, Business Insider,
May 2016 ---
http://www.businessinsider.com/when-to-claim-social-security-benefits-2016-5
. . .
What if you’re still
working?
What age gives you
the highest benefits?
What happens in a
widow(er) situation?
What’s the breakeven
if you wait to claim?
What about divorced
spousal benefits?
How does social security affect tax
planning
Continued in artilce
Retirement Planner: Benefits For Your Divorced Spouse ---
https://www.ssa.gov/planners/retire/yourdivspouse.html
Here’s What You’ll Pay for Health Care In
Retirement (Social Security benefits won't even cover your health care costs
if you add supplemental Medicare insurance (that I recommend by the way)) ---
http://time.com/money/4340299/what-youll-pay-healthcare-in-retirement/
Forget about retiring
on Social Security. Health care costs alone will devour the entire lifetime
benefits—and then some—of a 45-year-old couple when they retire, according
to projections released Wednesday by HealthView Services, a Danvers, Mass.-
based company that provides retirement health care cost data and tools to
financial advisers.
Social Security
payments will stretch farther for current retirees, but the numbers are
still stark: In 2016, the average 66-year-old couple will require 57% of
their lifetime, pre-tax Social Security benefits to pay for health care
costs, according to HealthView Services. The average 45-year-old couple, by
contrast, will need 116% of lifetime Social Security payments to cover
health care costs.
Total retirement health care expenses for that 45-year-old couple planning
to retire at age 65 will come to $592,275 in today’s dollars and $1.6
million in future dollars, HealthView Services projects. The projection
assumes the male member of the couple will live to 87 and the female to 89.
The total tab includes premiums for Medicare Part B, which covers doctors’
visits, Part D, which covers drugs, and Part F, which is the most
comprehensive supplemental insurance. It also includes expenses not covered
by Medicare, such as dental work and hearing aids. Notably, it does not
include long-term care costs. Medicare does not pay for long-term stays in
nursing homes, or for assisted living facilities.
Of course, these averages won’t reflect everyone’s experience. People’s
individual health status will influence how much they pay. What’s more, not
everyone will choose to buy a Part F Medigap policy. It’s a popular but
expensive choice, with monthly premiums that vary widely by region but
average around $200.
While expensive, Part F plans eliminate a lot of the uncertainty of medical
expenses. Premiums are predictable and cover most of beneficiaries’
out-of-pocket expenses. Without a supplemental plan, beneficiaries could be
on the hook for even more if they have a big medical episode, such as a
stroke, or a serious diagnosis like cancer.
On Plan F, “if you never have a problem and drop dead at 110, you’ll have
wasted a lot of money,” said Ron Mastrogiovanni, founder and CEO of
HealthView Services. A more likely scenario, he said, is that, “We’re not
going to stay healthy throughout retirement.”
Continued in article
Bob Jensen's personal finance helpers ---
http://faculty.trinity.edu/rjensen/bookbob1.htm#InvestmentHelpers
Bob Jensen's universal health care messaging ---
http://faculty.trinity.edu/rjensen/Health.htm
If you
are daydreaming about the differences
between men and women don't forget this
important difference.
In July
I had occasion to visit a friend in our
local nursing home in Franconia. I had
to pass by a large number of residents
on the porch before reaching the front
door. I counted 18 old women and 2 old
men. Why weren't the gender odds like
this the same when I was a student on
campus?
From the
CPA Newsletter on December 4, 2015
Women face higher long-term care
costs
Women are more likely to need
long-term personal care as they age,
research shows. In addition, women
often need this type of care for
longer periods than men do, partly
because they tend to live longer.
Total projected spending on
long-term care exceeds $182,000 for
women over 65, half of which will be
out of pocket.
Forbes
(12/3)
Jensen
Comment
Remember that Medicare does not fund
nursing home confinement, and the costs
of such confinements are exploding in
part due to demand increases from the
aging baby boomer generation. Yikes
that's me!
Medical Costs Can Add Up in Retirement
Two Big Reasons You Need Added Savings in Retirement ---
http://www.forbes.com/sites/ashleaebeling/2015/09/25/two-big-reasons-you-need-more-retirement-savings/
Think Medicare will cover you when
it comes to all your health-related
expenses in retirement? Not even
close. Sure Medicare is the
cornerstone of coverage, but it
covers approximately 60% of health
care expenses, and it does not cover
long-term care expenses. That leaves
retirees with major health care
expenses (medical, dental, vision,
prescription) and possibly long-term
care expenses (home health care
services or assisted living or
nursing care) coming out of their
retirement nest egg.
Pre-retirees should take a
two-pronged approach to planning for
these health-related expenses in
retirement and make health care part
of their overall retirement plan,
says Carol Goetsch, manager of
advisory client services at U.S.
Bancorp Investments in Minneapolis.
“Having a plan allows you to
determine where and how you want
coverage and the role your family
members will play; not having a plan
becomes reactionary and creates
dysfunction in the family.” Goestch
says.
Here’s the overwhelming big picture.
A couple at age 65 can expect to
spend $395,000 in medical, dental,
vision, hearing, premiums, co-pays
and other out of pocket health care
expenses in retirement–according to
Healthview Services 2015 Retirement
Health Care Cost Data Report.
Long-term care expenses are
separate, and will cost an average
of $140,000 per person, although the
averages can be misleading, meaning
you might need a lot more,
especially if you’re a woman.
Here are some planning tips.
Don’t count on
health care cost averages. A
Midwestern couple came to Goetsch
when they were turning 60. They
thought they could live off of
$75,000 a year until their Bancorp
advisor helped them run a health
assessment that estimated their
combined health care expenses would
be $3,500 a month or $42,000 a year
(one is a diabetic and one has heart
issues). On average an individual
needs $1,000 a month to cover basic
medical expenses in retirement, but
one mistake people make is looking
at averages instead of what their
circumstances project. “Certain
impairments take more of a toll,”
Goestch says. Gender, family
history, and current life expectancy
should all be taken into account. In
this case, the couple decided to
work a little longer and take
advantage of workplace benefits–at
least until they reached 65 and
could go on Medicare. They cut back
on lavish travel and supercharged
retirement–and health care–savings.
Continued in article
Four Mistakes That Could Ruin Your
Retirement ---
http://www.cnbc.com/2015/09/03/4-mistakes-that-could-ruin-your-retirement.htm
Mistake: Boosting
bond allocations at retirement
It used to be a good ideal to shift
from CREF to TIAA before retirement.
Thanks to the Fed's virtually zero
interest rate policies this may no
longer be a good idea. Times change,
however, so everything should be
reconsidered if you won't be
retiring soon.
Mistake: Counting on Medicare to
cover all health care costs
Medicare is being torn apart by
fraud and explosion of medical
costs. Drastic revisions in the
future almost certainly will entail
making middle and upper income
retirees bear much more of their
medical costs than they currently
are paying out when on Medicare.
Mistake: Moving to a state for the
low income taxes
There are usually more important
variables for choosing where to live
in retirement than state income
taxes. However, if plans include
moving to another state both income
and inheritance taxes should be
considered. We have two grown
children living in California and
Maine. Taxes were a consideration
when we chose New Hampshire with
good tax deals relative to Maine and
California, and New Hampshire is
very close to Maine.
Mistake: Not saving
enough for retirement.
This is a bigger problem since the
Fed's zero interest rate policy
destroyed most safe investment
alternatives like certificates of
deposit and low-risk bonds. Now
investments for retirement must take
on more risk like choosing all CREF
versus having some TIAA. Of course
taking on more financial risk
entails taking more chances. Dah!
Some investors take chances in real
estate, but the real estate in my
portfolio was only in the house I
lived in and the land surrounding
this house. I do not generally like
rental property because of the
headaches of being a landlord
(including owning a farm). I do not
like idle land investments because
of the annual property taxes and
insurance cash going out and no cash
coming in.
More of Bob
Jensen's personal finance helpers
---
http://faculty.trinity.edu/rjensen/bookbob1.htm#InvestmentHelpers
This is the research you should do before picking a credit card ---
http://www.businessinsider.com/sc/pick-the-right-credit-card-2015-8
AICPA: Back-to-School: How to Pay for College
---
http://blog.aicpa.org/2015/08/back-to-school-how-to-pay-for-college.html#sthash.gcYpuxSm.PSkI9cqt.dpbs
The Upshot: Is It Better to Rent or Buy? (real estate calculator) ---
http://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html
Jensen Comment
My general advice for new faculty is not to buy a home until tenure is achieved
except in hot markets where fast turnover profits are probable provided too much
is paid initially. After tenure achievement the above calculator can be helpful.
My priors were to invest as much as possible in long-term ownership of a
house and the least possible in the long-term ownership of a very reliable car.
However, be careful where you buy real estate. Up in the White Mountains I
advise mountain or lake views even though New Hampshire has a view tax.
There really aren't any gated neighborhoods up here, and nothing would be gained
by having gated neighborhoods. In San Antonio I would not put big money into a
house that's not in a gated neighborhood. Even if you're opposed philosophically
to that concept, the fact is that expensive homes do not sell very well in San
Antonio unless they are in gated neighborhoods with armed guards at the gates. I
would have had much more capital gain on my big San Antonio house if it had been
in a gated neighborhood. Sigh!
The Upshot: Is It better to Lease or Buy a Car? ---
http://money.howstuffworks.com/business/getting-a-job/buy-vs-lease-car.htm
Jensen Comment
Leasing became much more attractive when the Federal Reserve drove commercial
interest rates toward zero. But that does not mean "more attractive" than buying
in all instances. Much depends on the amount you drive and the terms of the
lease in the context of the amount you drive. It also depends a lot upon
your willingness to drive older cars. When I worked in San Antonio where newish
cars are stolen in unbelievable numbers daily my wife's car was a newish tiny
Honda Civic, and I drove a very reliable battered up ancient Ford station wagon
that had a newish engine and transmission under the hood. This ghetto-like car
looked so bad that nobody would think of stealing it and driving it across the
border to Mexico.
In general, even in retirement, my wife and I do not mind driving
well-maintained older cars. Our main car in the White Mountains (where car theft
would be headline news) is a very reliable Subaru Forrester that we will
probably drive until it is at least 20 years old (it's now five years old) or
has over 100,000 miles. The Subaru will probably be the last car we ever
own. After that its car leasing for us unless we're in a nursing home. I also
keep an unreliable old Jeep Cherokee in the barn that's used mostly for hauling
brush to the dump. That will be in our barn on the day I die.
My point is that leasing would probably not be the best choice for us until
we're very old. However, leasing is the best choice for most of our children
except for one son who puts a lot of miles on a car commuting a long distance to
work in California.
How to Mislead With Statistics
"How much you have to save every year if you want to put your kids through
college," by Libby Kane, Business Insider, April 27, 2015 ---
http://www.businessinsider.com/how-much-to-save-every-year-for-college-2015-4
Customized cost and savings calculators.
Jensen Comment
I've repeated elsewhere over and over
that there are many factors that make
the cost of college education variable
and uncertain. For example, the cost of
getting an online degree (even from a
high quality university) while living at
home is a whole lot different than
paying full tuition, room, and board for
an onsite degree at either a public or
private university or college.
Also financial aid is common and very
serious for a majority of students. The
tuition cost is now
zero in
many USA prestigious (e.g., Ivy League)
universities for students from families
earning less than $125,000 per year. In
addition, President Obama is now
forgiving all or parts of student loans
for a relatively small number of
graduates.
The problem when the kids are very young
lies in choosing a college savings plan
without knowing what lies ahead in terms
of future tuition costs, living costs,
financial aid, etc. Colleges may be
funded quite differently 20 years from
now, and we really don't know what kind
of deals will be available way out in
the future. For example, it's entirely
possible that the most prestigious
universities in the USA will be totally
free to all students, albeit a highly
restricted number of students qualifying
for admissions. It's entirely possible
that the first two years of college will
eventually be free in most
state-supported universities.
Parents and especially grandparents
currently contribute a great deal of
financial support from tax-advantages
529 Plans ---
http://en.wikipedia.org/wiki/Coverdell_Education_Savings_Account
Who knows if and how long those plans
will survive?
These plans are currently clobbered by
the Fed's "quantitative easing" (QE)
interest rates that through savers under
the bus by paying virtually negligible
interest rates.
A Guide to College Savings Plans ---
http://www.moneygeek.com/education/college/resources/college-savings-plans-guide/
This Is the Worst Retirement
Solution Ever ---
http://www.bloomberg.com/news/articles/2015-04-21/this-is-the-worst-retirement-solution-ever?cmpid=BBD042115
Tips for Passing a Personal-Finance
Stress Test ---
http://blogs.wsj.com/briefly/2015/03/11/5-tips-for-passing-a-personal-finance-stress-test/
Your household finances might be
humming along just fine. But would
they be able to withstand an
unforeseen medical bill or sudden
reduction in paid working hours? How
about a job loss, furlough or
unexpected tax assessment? As the
Federal Reserve prepares to announce
the results of this year’s stress
tests on the nation’s largest banks
Wednesday, we offer the following
five stress tests for your own
finances.
1 Debt-to-Income Ratio
Divide your debts, including credit
cards, student-loan and car-loan
balances, and your mortgage, by your
pretax earnings. That will give you
your debt-to-income ratio.
Sheryl Garrett, the founder of the
Garrett Planning Network, says a
good rule of thumb is to have a
personal debt-to-income ratio of
less than 28%, not counting
mortgages, or household
debt-to-household income of less
than 36%, including mortgages.
A higher ratio is a warning that you
have too much debt relative to your
income and you either have to lower
your debt or raise your income, or
both.
2 Discretionary Expenses
It’s important to know what your
discretionary expenses are and how
quickly you can cut back on them in
times of stress.
Start by sorting all your expenses
into three categories: fixed, which
are those payments you have to make
regardless of circumstances;
variable nondiscretionary, which are
expenses such as groceries or
air-conditioning bills over which
you can exercise some level of
control; and purely discretionary
expenses such as gym memberships and
vacations.
Discretionary expenses should make
up a greater percentage of your
overall expenses than your fixed
expenses, says Eleanor Blayney,
consumer advocate for the CFP Board
in Washington, giving you room to
defer, cut back or eliminate.
“Figure out what you could live
without or whittle down quickly,”
she says. Discretionary Expenses >
Fixed Expenses
A good standard is for discretionary
expenses to be two thirds of your
overall expenses.
3 Emergency Savings
Financial planners tell clients to
reserve enough cash in savings or
other easily liquidated accounts to
cover three to nine months of
expenses—with three months being the
bare minimum.
This stash will be the first place
you turn for help because it is
readily available. Getting at it
shouldn’t require selling securities
or taking an early-withdrawal
penalty from a retirement account or
certificate of deposit.
The greater your obligations, the
more emergency cash you should have
squirreled away, planners say. A
single mother with a mortgage would
want several months if not more than
a year of cash to cover expenses,
for example. A freshly graduated
single person who has no student
debt and who is renting an apartment
might need only three months’ worth.
The National Foundation for Credit
Counseling offers a program called
“Sharpen Your Financial Focus” that
has free online questionnaires for
people to use in figuring out their
own plans. 3 to 9 You should have
enough cash to cover three to nine
months of expenses in case of
emergency.
4 Additional Income
Consider your options for generating
additional income in a period of
stress, says Bruce McClary, a
spokesman for the National
Foundation for Credit Counseling.
Wages or tips from a second
part-time job or proceeds from
selling personal possessions could
raise enough to float you through a
financially strapped period without
spending down your emergency savings
too quickly.
5 Total Assets
If banks are evaluated by the
liquidity and quality of their
balance sheets and their ability to
weather a run on their deposits,
consumers could be evaluated by the
liquidity and quality of their
assets and how well they could
withstand an immediate call by all
their creditors, Ms. Blayney says.
Add up your emergency savings, the
equity in your home and the balances
in your retirement savings accounts
to get your total assets. Then
divide that number by your monthly
expenses to figure out how many
months you could live with no
investment appreciation and no
income until you have completely
depleted those assets.
Take two people, each with a net
worth of $1 million. The first
person has securities and cash
accounts, the second has her money
tied up in real estate. Which one
could pay the bills more quickly
with less of a discount to convert
assets to cash?
“You need to
look at the liquidity of the net
worth and the quality of it,” she
says.
Corrections & Amplifications
To calculate debt-to-income
ratio, divide your debts by pretax
earnings. An earlier version of this
post incorrectly said the ratio was
obtained by dividing pretax earnings
by debts.
Jensen Comment
The article should have given more
consideration to tax planning. For
example, I would give consideration to
combining savings liquidity with tax
exempt income in a diversified tax
exempt mutual fund such as a a low cost
fund (with a checkbook) available from
Fidelity or Vanguard. Care must be
taken, however, to have long-term
savings that are better protections
against inflation such as CREF accounts.
Real estate is a tricky investment due
to property taxes and insurance. If
there's sufficient rental to cover these
expenses such as in a condo or
profitable farm then real estate is more
attractive as a long-term investment.
For example, I have a friend who kept
his condo beside the Dartmouth College
campus long after he moved on. He now
calls this condo his cash cow.
However, I don't like being a landlord
--- which is why I sold my inherited
Iowa farm and invested mostly in our
home and in a tax exempt mutual fund
from Vangard. However, I'm old now so
that inflation is less of a worry in my
remaining lifetime.
Bob Jensen's threads on personal
finance ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
"Here's The Painstakingly Detailed
Budget Of A Couple Who Earns Nearly
$15,000 A Month," by Libby Kane,
Business Insider, January 26, 2015
Question
Suppose you were teaching a financial
literacy course and used the following
monthly budget for a couple. What would
you focus on to stimulate student
debates on the issues.
Hints
·
The couple earns $180,000 after-tax
withholdings and tax estimated
additional payments per year (assuming
both adults work giving rise to the day
care allowance).
·
My calculation assuming a 4% APR 30-year
mortgage initially is that the couple
owns a home originally costing $345,150
plus whatever they made in a down
payment. This price would be relatively
high in a decadent farming town in Iowa
and relatively low in a suburb of most
major cities. It would be a tent in
Silicon Valley. It would not be much of
a house within a walking distance of
virtually all major universities in the
USA.
The house probably cost a lot less if
the $1,647.80 payment also covers
property taxes and mortgage insurance.
Have your students estimate the original
cost of the home if the payments on the
mortgage itself are only $1,000 per
month. They must be living in an old
shack or a cramped town house.
·
The life insurance seems relatively low
for a family with young children.
·
The "out-to-eat" budget is relatively
low and can be used up entirely with two
nights out at nice restaurants per
month. The family must eat out mostly at
fast-food and pizza joints. One way to
save money plus eat healthy meals is to
eat at a nearby hospital like we did in
both San Antonio (where the Northeast
Baptist Hospital was only a block away).
Eating at the hospital was cheaper than
cooking at home. Erika worked full time
at this hospital.
·
The electric bill of $200 would not
cover our electric bill with heating and
air conditioning while we lived in San
Antonio where the electricity and gas
bill was over $400 per month. In the
White Mountains of New Hampshire
electricity, propane and heating oil
would be more like $1,000 per month.
It's very cold up here.
·
I think for a younger family not of
Medicare the medical, dental, and
prescription drug allowance is way too
low in the budget shown in the article
below. For retired folks like us on
Medicare the medical, dental and
prescription outlays would be much, much
higher --- more like $1,500 per month.
Younger folks naively think Medicare is
"free" after you retire. It's not free
when you add in the cost of Medicare
itself, the cost of Medicare
supplemental insurance, and the
out-of-pocket costs of medicine not
covered by Medicare D.
·
How about the other monthly estimates?
Are they realistic for the USA?
Are important items deleted in terms of
most families?
o
In San Antonio where I watered my lawn
with a sprinkling system my water and
sewer bills were over $200 per month
o
My Time Warner cable bill is now over
$160 per month
o
What about those monthly iPhone usage
fees?
o
How about home owner insurance and
umbrella (liability) insurance?
o
How about lawn and garden equipment such
as a garden tractor and lawn mowers and
snow throwers?
o
What about furniture and appliance
costs? Up here in the boondocks I spend
quite a lot on extended on-site
warranties.
When you teach from this budget you
might go into more details regarding
possible tax strategy and retirement
strategy pros and cons.
"Here's The Painstakingly Detailed
Budget Of A Couple Who Earns Nearly
$15,000 A Month," by Libby Kane,
Business Insider, January 26, 2015
---
http://www.businessinsider.com/detailed-budget-of-high-earning-couple-2015-1
February 1, 2015 reply from Patricia
Walters
Bob
Not every place charges for water. We
had a well in VA and we paid electricity
and maintenance for the pump, not for
the water.
We had a lawn mower in VA. Here we have
someone come and cut our grass who has
the equipment, about 100 per month in
the growing season only. No snow. Even
in VA we had shovels, not power tools.
No TV, only cable for internet. Biggest
utility charges electricity (we have big
OLD house) and phones.
We don't know where these people live.
Costs vary widely depending on location,
even within counties.
Are there homes in Fort Worth that cost
over a million? Sure. But there are also
homes in reasonable neighborhoods for
less than $150,000. I live in one of
those neighborhoods.
I've lived in NYC, NJ, VA and now TX.
Costs vary widely across those places
and within those places.
One if their biggest expenditure was
school, which seemed likely to me.
Why do you doubt the truth of their
budget?
Pat
February 2, 2015 reply from Bob Jensen
Hi Patricia,
I did not doubt the truth of their
budget, but I did think they left a few
things out or were ambiguous about some
things that need to be clarified by a
teacher or students using this budget in
a financial literacy course.
For example, the $1,687 mortgage payment
could be the mortgage alone or it could
also cover property taxes, homeowner
insurance, and mortgage insurance. Take
those away from the payment and you are
left with a fairly low-sized mortgage.
In my case the property taxes are $1,000
per month but they are not part of my
mortgage payment in these mountains. In
fact the property tax payment and the
mortgage payment only differ by $200
because I paid over 60% down at the time
of purchase. Later I refinanced the
remaining mortgage for 3.6% for 30
years. I pay the homeowners insurance
separately, and that's not cheap up
here.
Most people cannot afford such a large
down payment unless they're retired. In
rural mountain and ocean properties the
banks typically require larger down
payments than in towns. In many
instances former owners must finance the
homes they sell.
When I taught at the University of Maine
I had an ocean cottage that could not be
financed except by an owner. Banks would
not loan on shore property in those
days. That made interest rates highly
variable, because they were part and
parcel to sales price negotiations.
Owners also typically demand large down
payments when they finance sales
properties.
I also wanted a mortgage so I could play
the game of having more itemized tax
deductions plus invest more in a
long-term insured tax-exempt mutual fund
that pays only slightly less than by
mortgage interest rate. The standard
deduction sucks, but you have to have a
sizable amount of itemized deductions to
cover the minimum threshold for itemized
deductions..
I could pay the mortgage off any time,
but I don't want to due to a tax
strategy that might be debated by
students in a financial literacy course.
That's why I suggest having students
debate alternate tax strategies at the
same time they are discussing household
budgeting.
Having a deep water well makes me not
concerned about the cost of water usage.
Wells only get expensive when you have
to replace the well and or the pressure
tank and pump. Two of my neighbors had
to replace their wells, and it cost each
of them thousands of dollars.
With a well also comes a septic system.
The risk here is having to replace the
drain fields for broken tiles. That
expense depends a lot on having
sufficiently high ground for another
field. You can't put a new drain field
over an old drain field or in low land
that does not drain well from rain and
snow melt.
A B&B down the road is having all sorts
of troubles finding a suitable place for
a new drain field. The small hotel has
been empty for over a year in part
because of this problem and the need for
a new well.
In San Antonio you could get housing
relatively close to Trinity University
for less than $200,000 but most faculty
who do so either do not have children or
send their children to private schools
(which is really expensive). Also crime
risks are higher near campus relative to
most outer northern parts of the city.
By higher crime risk I mean that I don't
recommend walking near campus at night
and having to have high quality home
security systems.
Trinity has very safe and well lighted
walking, jogging, and biking trails on
campus that are heavily patrolled by
officers on bicycles. These trails are
used a lot by neighbors not affiliated
with the University. It's a public
service.
Thanks for your thoughts,
Bob
From the CPA Newsletter on September 3,
2014
How retirement planning has changed
since ERISA was enacted
http://r.smartbrief.com/resp/gbsdBYbWhBCJbSoSCidKtxCicNRJcg?format=standard
The Employee
Retirement Income Security Act was
enacted in 1974 in response to some
much publicized failures of private
defined benefit (or pension) plans.
Rebecca Miller, CPA, Robert
Lavenberg, CPA, J.D., and Ian
MacKay, CPA, CGMA, mark ERISA's 40th
anniversary with a look back at the
challenges ERISA was originally
intended to address and the issues
facing retirees now and in the
future.
Journal of Accountancy print issue
(9/2014)
Bob Jensen's threads on pension
accounting ---
http://faculty.trinity.edu/rjensen/Theory02.htm#Pensions
Fees =
Transactions Costs (when buying or selling shares) plus Fund Management Fees
(paid annually to professionals who manage your portfolio like the managers at
TIAA/CREF, Fidelity, Vanguard, etc.). manage your retirement funds.
Taxes =
Capital Gains Taxes (that apply even on
retirement funds like CREF when you make
eventual withdrawals). Note that capital
gains taxes must be paid by your estate
on the balances left in your retirement
funds. Most of us won't get hit with
estate taxes (due to high estate tax
exemptions), but we all get hit with
capital gains taxes on the retirement
funds and farms we leave behind for
heirs.
Inflation =
Loss in Buying Power of Saving Dear
Money That Turns Into Cheap Money (even
under your mattress)
The government is now misleading us
about inflation by taking price
increases for food and fuel out of its
reported inflation index so you
think that your dollars are still dear
when they are cheap in terms of things
that you buy day-by-day. Economists
are whores for politicians.
Government deficit spending and
obligations for $100 trillion in
unfunded entitlements (like Medicare and
Medicaid) make inflation the biggest
worry of the three diseases on
retirement savings --- fees, taxes, and
inflation.
"Here's How Little
You Earn On Stocks After You Pay The
Man, Uncle Sam, And The Invisible Hand,"
by Myles Udland, Business Insider,
August 29, 2014 ---
http://www.businessinsider.com/thornburgs-real-real-equity-returns-2014-8
Fees,
taxes, and even inflation just kill
your investment returns.
A
Thornburg Investment Management
study of "real, real returns,"
which was
alerted to us by
Cullen Roche at Pragmatic Capitalism,
shows
how various costs eat into your
stock market returns.
Real, real returns take into account
expenses (the man), taxes (Uncle
Sam), and inflation (the invisible
hand).
Thornburg's study notes that
"nominal returns are a misleading
driver of an investor's investment
and asset-allocation planning...
because they are significantly
eroded by taxes, expenses and
inflation." The risk then, as
Thornburg sees it, is that a failure
to understand real, real returns
could lead to investment decisions
that miss potential diversification
opportunities.
This chart from Thornburg shows how
the annualized nominal return of
$100 invested in the S&P 500 between
1983 and 2013 is about 11%, making
that investment worth $2,346.
However, on a real, real basis that
investment returns 6%, making it
worth just $570.
A
pretty stark difference between
expectations and reality.
Jensen Comment
There are ways of partly beating the tax
man by investing a portion of your
retirement funds in a tax-exempt mutual
fund that holds bonds of school
districts, towns, cities, counties, and
states. However, I say "partly beats" in
the sense that value changes in those
funds are subject to capital gains taxes
even if the interest on those bonds that
builds up your savings are not taxed
while your earn that interest or when
you withdraw that interest. A second
drawback is that there is relatively
more risk in investing in a given
tax-free municipal bond versus a taxable
high-grade corporate bond. But huge
diversified tax-free mutual funds like
those of Fidelity and Vanguard. A third
drawback in theory is that
tax-free bonds should earn less interest
than corporate bonds. This is not always
the case in this era of stupid
quantitative easing by the Federal
Reserve that keeps interest rates on CDs
and high-grade corporate bonds close to
zero. Tax-free interest rates have held
up batter in this idiotic era of
quantitative easing since the crash of
2007.
Remember that higher
return investments also carry higher
financial risks beyond the savings
killers of fees, taxes, and inflation.
For example land investments have less
inflation risks but are subject to many
other financial risks. For example,
think of paying a million dollars for an
Iowa farm that sold ten years ago
$500,000 and doubled in value because of
the corn ethanol government mandate for
gasoline. The added financial risk for
your new farm is that one day soon the
government will come to its senses and
remove the ethanol mandate for fuel,
thereby leaving the corn for cows and
hogs. Your million dollar farm may
plunge in value --- thus the added
investment risk beyond the retirement
savings killers of fees, taxes, and
inflation.
"The
Crushingly Expensive Mistake Killing
Your Retirement: 401(k) fees
are costing you hundreds of thousands of
dollars over your lifetime," by
Matthew O'Brien, The Atlantic,
February 15, 2014 ---
http://www.theatlantic.com/business/archive/2014/02/the-crushingly-expensive-mistake-killing-your-retirement/283866/
Jensen Comment
Investors should probably question
whether they need to pay a financial
advisor on top of the unavoidable
expenses of managing a mutual fund.
Investors should also seek out lower
cost fund management funds such as
Fidelity, Vanguard, and TIAA/CREF. Most
of the more expensive funds are
delivering addedreturns that justify the
added costs unless they have taken you
into financial risks you don't
understand.
The big funds offer a lot of free
advising services that you should
investigate before running down to a
personal advisor in a glitzy office
building.
"5
Little-Known Ways To Save Money On
Amazon ," by Grayson Bell, Debt
Roundup via Business Insider,
August 29, 2014 ---
http://www.businessinsider.com/ways-to-save-money-on-amazon-2014-8
Jensen Comment
If you are an active buyer like me on
Amazon it probably pays to become a
Prime member.
One advantage of living in the boon
docks is home delivery when you're not
at home. I know the rural mail carrier
(Mary), the UPS driver (Joe), and the
FedEx driver all by name. They leave the
deliveries in our unlocked garage in
rain, snow, or shine. When I lived in
San Antonio I would've not dared to
leave our garage unlocked. City living
is just more scary and a hassle in many
other ways.
Don't forget to use your accumulated
payment credits on Amazon. Amazon makes
it really easy to use those points when
making a payment.
"How to Choose a Charity Wisely," by John F. Wasik, The New York Times,
November 7, 2013 ---
http://www.nytimes.com/2013/11/08/giving/how-to-choose-a-charity-wisely.html?ref=giving&pagewanted=all&_r=0
DONATING to
charities this time of year used to
be relatively efficient and
painless. After watching the Macy’s
Thanksgiving Day Parade, you plunked
some money into a Salvation Army
bucket, wrote some checks,
contributed some household items and
were done.
Yet with
charities increasingly involved in
awareness campaigns, complex
networks of cause marketing and
often exorbitant overhead, donating
to the most effective charity has
never been more challenging.
If you are a
discriminating giver, you will need
a set of guidelines that can tell
you if your donation will mostly be
spent on a charity’s mission and not
peripheral activities. These days
you have to use your head far more
than your heart to see that your
charitable dollars are well spent on
causes you care about.
There are
services and strategies that you can
use to make an informed decision.
Most of them can help you determine
if your dollars will reach the
charity’s “mission” — and whether a
nonprofit organization is effective
in what it is striving to do.
Charities are
already witnessing greater
selectivity among donors, probably
driven by the pinch of a sluggish
economy. According to The Chronicle
of Philanthropy, a trade newspaper
for the nonprofit sector, donations
to the top 400 fund-raising
charities are slowing this year
after gaining 4 percent in 2012.
Last year, the top nonprofits took
in about $81 billion.
Although such
things are hard to measure, it is
possible that donors have become
more sophisticated in their giving
as useful information on charities
has become more detailed. Yet it is
easy to get distracted by ubiquitous
causes that blanket every corner of
society. Herewith, a guide to
navigating the thicket.
The
Major Services
One of the
first stops in searching for
charities is
GuideStar,
which contains records from 1.8
million nonprofits registered with
the Internal Revenue Service.
The free
component of the GuideStar website
provides access to each
organization’s Form 990, the basic
I.R.S. filing document for
nonprofits. That is useful on the
front end if you want basic
information on a charity’s income,
spending, mission and executive
salaries.
As with the
other services, you can also pay for
“premium” services from GuideStar
that provide more financial analysis
and access to a nonprofit’s
contractors. This would help if you
wanted to perform detailed
comparisons of charities or to
explore their financial ratios or
executive compensation
in greater
depth.
What GuideStar
does not do is give a qualified
rating of a charity. It tries to
remain neutral and “is not a charity
evaluator,” says Lindsay J. K.
Nichols, a spokeswoman. For more
intensive evaluations, you need to
go to the BBB Wise Giving Alliance
or Charity Navigator.
The
BBB Wise Giving Alliance,
affiliated
with the Council of Better Business
Bureaus, has free reviews of 1,300
national charities; local BBBs have
evaluations on an additional 10,000.
The group applies 20
“accountability” standards —
governance, oversight, effectiveness
and the like — once every two years
at no charge to the charities, but
it does not explicitly rate them
using a star or letter system.
The alliance
will specify if a charity does not
meet BBB standards or “did not
disclose the requested information.”
About 40 percent of the charities
evaluated meet
all 20 benchmarks; ones
that do are designated a “BBB
Accredited Charity.”
Organizations
accredited by the alliance can then
pay a sliding-scale fee based on
their size to obtain a license to
use the BBB Charity Seal on websites
and fund-raising material. About 60
percent of those qualifying elect to
pay the fee for the seal.
Like GuideStar
and Charity Navigator, the alliance
cautions against paying too much
attention to the percentage spent on
nonprogram expenses, also known as
the “overhead ratio.”
The alliance’s
approach appears to be more rigorous
than the other two services’,
although its findings are not
compiled into an overall rating.
Organizations are deemed
“accredited” (met standards),
“standards not met,” “unable to
verify,” “did not disclose” and
“review in progress.”
Still, the
group’s focus on audited financial
statements and accountability — it
also publishes in-depth newsletter
articles on the subject — is a
pragmatic way to view a charity’s
operations.
Art Taylor,
the alliance’s president, said the
group “sees where the charity is at
on our 20 standards, which goes to
the heart of how a charity
functions.”
To customize a
search and get charity-specific
ratings, Charity Navigator, which
evaluates about 7,000 nonprofits,
has an easy-to-use interface to find
charities that match your interests.
Focusing on
financial health, accountability and
transparency,
Charity Navigator
applies an
analysis to each of its charities to
come up with its star ratings (with
four stars as the highest rank). It
examines federal Form 990s to see
how much of a charity’s income goes
toward programs and what percentage
is spent on administration and
fund-raising. Of the three major
services, Charity Navigator is the
easiest to use.
Generally, a
good benchmark for a worthwhile
charity is having at least 75
percent of income spent on programs,
or the nonprofit’s mission,
according to Sandra Miniutti, a
spokeswoman for Charity Navigator.
Aside from
vetting a charity’s financials, Ms.
Miniutti suggests, donors should
“understand the charity’s mission —
pick just a few, do your research
and stick with them over time.”
Getting Granular
Want to dig
deeper and go beyond the charity
information services? You can use
them to find basic information on
revenue, fund-raising and spending,
but you will need to go several
layers deeper if you want additional
scrutiny. Here are some major issues
to consider:
■ Have you
compared the charity’s Form 990 with
its annual report and audited
financial statements?
The 990 can
often be opaque and may not tell you
particulars on an organization’s
specific programs. You may need an
accountant or
financial adviser
acquainted
with nonprofit accounting to review
these documents; the audited
financials contain much more detail.
■ Does the
charity practice “joint cost
allocation?”
This is
accounting jargon for lumping in
fund-raising or solicitation with
the charity’s program expenses.
According to the BBB Wise Giving
Alliance, more than 20 percent of
nationally solicited charities it
reviews employ this practice, which
could muddy the waters in gauging
how much is really being spent on
the charity’s mission. To get a
clearer picture, you will need to
identify the charity’s primary
purpose. If it is mainly a
grass-roots lobbying or public
awareness organization (which means
you may not be able to deduct your
donation), then joint cost
allocation may make sense. If it
devotes its efforts to financing
research, then the allocation may be
a red flag.
■ How does
the charity evaluate its
effectiveness?
You should be
able to see some examples in its
annual reports. Also, ask the
charity directly about its
successes. Does the organization use
independent auditors to benchmark
its performance? Where has it
failed? A transparent charity should
provide this information along with
progress reports.
Eric Friedman,
author of “Reinventing Philanthropy”
(Potomac Books, 2013), says
charities that cannot gauge their
effectiveness through benchmarks
“may have effective programs, but
it’s hard for donors to understand
how effective or compare them to
other options. I’ve stopped focusing
on financial measures, which can be
misleading.”
■ Is the
mission supported by academic
research?
Organizations
may be funding ineffective ways of
addressing their mission. A boutique
charity information service like
GiveWell
recommends only three organizations
a year out of the hundreds it has
considered since its founding in
2007. GiveWell performs extensive
research to show that recommended
charities are “proven,
cost-effective, scalable and
transparent,” said Alexander Berger,
its senior research analyst.
“Because we’re aiming to find the
best giving opportunities possible —
not to rate every charity — we don’t
research charities that are unlikely
to excel on our criteria.”
■ Watch
out for red flags.
Because
nonprofit accounting and reporting
can be incomplete, suspicious
activity can be hidden. Daniel
Borochoff, president of
CharityWatch,
formerly known as the American
Institute of Philanthropy, rates 600
charities with a grading system from
A to F — and takes a watchdog
approach that tries to expose
nonprofit abuses. “There’s a lot of
sneaky reporting going on,” Mr.
Borochoff said. He said chicanery
could often be found in “gifts in
kind,” where donations may be
overvalued, or in organizations with
emotional appeals — some charities
involving animals, children, first
responders and veterans. They may be
little more than aggressive
fund-raising operations that do
little for their missions, or funds
that are diverted to officers or
other purposes.
■ Do you
need comprehensive advice?
If you are
also concerned about tax or
estate planning
considerations, it would make sense
to work with a wealth manager,
estate-planning lawyer or certified
financial planner. Many advisers
also have insights into nonprofit
accounting that can help you vet a
charity on a deeper level. Robert J.
DiQuollo, chief executive of Brinton
Eaton Wealth Advisors in Madison,
N.J., said he could scrutinize
nonprofit line items like executive
salaries and program-related
expenses. “We always approach the
charity directly,” Mr. DiQuollo
said, “to make sure that the charity
is spending money on what the donor
wants.”
■ Is the
charity sitting on too much cash?
You need to
know if the charity is putting its
cash to good use or reserving it for
some other purpose. According to
Wise Giving Alliance standards, “the
charity’s unrestricted net assets
available for use should not be more
than three times the size of the
past year’s expenses or three times
the size of the current year’s
budget, whichever is higher.” This
is something you may need an
experienced accountant to evaluate.
The bottom line: As a donor, you
need to know if your money will be
put to work immediately or
sidelined.
Due
Diligence
¶ What can you
do with these ratings and reams of
financial information? Although you
can become immersed in nonprofit
accounting arcana and employ all of
the charity research services, your
efforts may still not tell you if a
charity is worthwhile.
Continued in article
"Five Really Dumb Money Moves Retirees Make: How to Avoid Ever
Having to Say 'I Lost the Nest Egg'," by Tom Lauricella, The Wall Street
Journal, February 23, 2014 ---
http://online.wsj.com/news/articles/SB10001424052702303775504579394930456252714
After
decades of saving for retirement,
you never want to end up saying, "I
lost the nest egg."
For most
people, retirement savings will need
to be carefully tended if they are
to last two or three decades, a
typical life span after collecting
one's final full-time paycheck.
But there
are plenty of mistakes that can be
made. Some can deplete that nest egg
in one fell swoop, while others can
result in a slow bleed that becomes
apparent only over time.
Some
missteps to avoid:
1.
Big purchases.
It's a
natural instinct for new retirees to
want to kick back and treat
themselves following decades of hard
work.
Ronald
Myers, an adviser at Associated
Financial Consultants in Fort
Lauderdale, Fla., talks about
clients who see some of their
retirement funds as their "YOLO
money"—You Only Live Once.
"I'm the
first guy to say go out and enjoy
yourself early on—you aren't going
to get any healthier," says Mr.
Myers. But it's crucial, he says, to
avoid blowing a hole in a retirement
plan at the get-go. And given the
uncertainty of the market, the depth
of that hole may not become apparent
until much later in life.
He points
to example of a retiree who plans to
withdraw $25,000 a year from a
$500,000 nest egg starting off by
taking $50,000 to buy a boat—two
years of income.
Should that
big withdrawal be followed by a
market decline, the result could be
many years shaved off the time those
savings will last.
2.
No cushion.
In
retirement, a major, unexpected
expense can quickly send a financial
plan off the rails. But that doesn't
have to happen.
"I see a
lot of people cutting it really
close and living paycheck to
paycheck, even though they are
really paying themselves" out of
their savings, says Blair duQuesnay,
director of investments at
ThirtyNorth Investments in New
Orleans.
The problem
comes when an emergency crops up
that requires laying out extra cash
on short notice. If that outlay
requires selling investments in the
middle of a market downturn, the
retiree could be locking in losses
that can't be recovered.
"It takes
planning ahead," says Ms. duQuesnay.
Her firm advises clients to keep six
months to one year's worth of cash
on hand for replenishing that
stockpile.
3.
Forgetting common sense.
Remember:
"There's no such thing as a free
lunch."
That's
especially the case with investments
promising big payoffs with low risk.
People
"have a unique ability to suspend
common sense, believing that
strangers want to let us in on deals
that are too good to be true, which
of course, are," says Alan Roth, a
financial planner in Colorado
Springs, Colo.
Mr. Roth
says there are often telltale signs
it's time to hang up the phone on a
sales pitch. They include: a sense
of urgency ("The deal is only good
today!"), using a church or
fraternal organization to vouch for
its credibility or a play on
emotions.
4.
Reaching for yield.
The "no
free lunch" risk to a nest egg also
applies to investors who have cut
back on holdings of relatively safe
but low-yielding government bonds
and bulked up on riskier investments
that offer meatier yields—like
high-yielding junk bonds, bank-loan
funds or dividend-paying stocks.
"When you
substitute a fixed-income,
low-volatility investment for a
higher-volatility investment, the
risk of a loss of principal in a
down market is much higher," says
Ms. duQuesnay.
A simple
litmus test for how well that
higher-yielding investment will act
are returns from during the
financial crisis. Bank-loan funds,
for example, lost an average of
29.7% in 2008.
5.
Letting emotions rule.
"Acting
emotionally in a down market could
be mistake No. 1" when it comes to
wrecking a nest egg, says Mr. Myers.
He
acknowledges that retirees who need
their savings to help pay the bills
will feel the pull of reacting to
short-term losses. "During
retirement, it's behavioral
economics on steroids," he says.
Retirees
should build a portfolio that meets
their long-term goals and one where
they can withstand watching the
inevitable downs in the markets that
come with the ups.
To put it
another way, says Mr. Roth: "It's
dumb to buy high and sell low."
Jensen Comment
It's hard to advise future retirees
without knowing what they really do
enjoy. For example, I think it's dumb to
invest in retirement businesses unless
you really, really enjoy retirement
businesses or really, really need the
income from retirement businesses. For
example, a widow purchased a three-story
house just down the road when she was a
widow over 60 years of age. For a while
making jewelry to pay for her mortgage
payments seemed like a good idea. Now
taking her truck and camper all alone to
out-of-state jewelry shows has become a
drag, but she needs the income in part
because revaluations of her home have
really clobbered her with higher
property taxes in a down market (at
least up here). Tax appraisers care more
about village and school expenses than
what property will realistically sell
for up here in the remote White
Mountains.
It's probably a good idea that she
invested in her jewelry business, but at
her present age it's become more
depressing. I don't think she's enjoying
her "retirement," especially since she
must do most of the house maintenance by
herself. Last summer she was on a huge
40-foot extension ladder scraping and
painting by herself almost every
sunny day.
She also splits her own wood to heat
that big house. What was her mistake? It
was probably a mistake to purchase such
a big house without the annual cash flow
to cushion the expenses of taxes and
maintenance while thinking she would
forever enjoy making jewelry and
traveling to shows.
There's also a couple that I know who
both retired from the military and
invested $2 million in a bed and
breakfast (mostly financed with three
mortgages). Running a B&B sounded like
fun until the reality of cooking
breakfast for guests seven days a week
became a drag year after year after
year. Even with hired maid service,
there are endless days of maintaining
the grounds, keeping the plumbing
working in 26 bathrooms, painting and
papering 24 rooms, washing windows,
fixing roof leaks, patching an ancient
heating system, operating the front
desk, dealing with happy and
not-so-happy happy guests, and on and on
and on. Retirement? What's that? They
were more retired while on active duty.
Then there's a retiree friend down on
the highway who purchased a $180,000
motor home hoping to entice a woman
friend into marrying him and touring all
over North America. She considered the
idea for 20 minutes and then said no
way. The motor home with less than 500
miles on the odometer sat in his front
yard with a "For Sale" sign for over
five years (he lives on a state highway
where drivers passing by could see the
thing year after year). At long last he
sold the thing, but I don't want to
embarrass him by asking how much he lost
on this dream (beside losing his
would-be bride). He had 12 nice cabins
and land out back that our village took
over due to defaulted property tax
payments.
I paid too much for a retirement
acreage, but I do enjoy this type
isolated rural living. It would be a
risk if my health failed and I had to
hire everything done around here.
However, I'm fortunate to have the
retirement cash flow to do so if I must
eventually hire everything done. And the
outdoor work winter and summer is
currently much more enjoyable than
boring exercise routines in a gym. If
and when I become gaga and have to go
into a nursing home my estate will take
a huge hit because it's impossible to
recover much more than half of what I
paid for this property in an up market
before the real estate crash.
However, in spite of contentment with
my own retirement, it's important to
note that many of those things you
dreamed about all your working years may
change over the course of your
retirement. Firstly, you may lose some
of your good health. Secondly, you may
lose your spouse that was part of your
retirement dreams all those years. And
yet at age 65 when you're both in good
health it probably would be a bummer
moving into an assisted living apartment
too soon. You both might quickly become
depressed and bored to death in a small
apartment if you have good health for
the next 10-25 years.
My own parents started their marriage
in the Great Depression and never really
got over feeling that saving was much,
much more important than consumption.
Being an only child I eventually
inherited their life savings. But all
they while they were retired I argued in
vain that they should spend more to
enjoy their retirement. But then
again if they were spending more to
enjoy their retirement they would
probably would not have enjoyed their
retirement. They were more happy
living a very modest life beneath what
they could well have afforded. Unlike me
they did not enjoy expensive restaurants
and hotels. They ordered the cheapest
things on menus in small farm town
restaurants and pretended those were the
selections they enjoyed the most as long
as there was a salad bar.
My mother always said: "If
you're going to buy big, buy black
dirt."
Bob Jensen's threads on personal
finance ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Question
Why do so few people going into retirement decide against lifetime fixed
annuities?
Jensen Answer
In 2006 I opted for TIAA lifetime annuities that pay out a fixed amount of
monthly income for as long as my wife and/or I are alive. Other options included
variable lifetime annuities (that go up and down with the stock market) and
lump-sum withdrawals of cash that we could manage ourselves. Lump-sum withdrawal
might have been more attractive if we were already sufficiently wealthy to have
retirement needs covered. Then we could have given more away to family and
charities. But we were not that wealthy.
A lifetime annuity works best if you
live many years beyond when all your
retirement funds are depleted. A
lifetime annuity is the gift that keeps
on giving.
A lifetime annuity works best if you
live many years beyond when all your
retirement funds are depleted. A
lifetime annuity is the gift that keeps
on giving.
At our ages inflation is less of a risk concern than for younger people who
are still investing toward retirement. However, if I were advising a younger
person who becomes eligible for a TIAA payout because of a divorce I would
stress the inflation risks of a very long-term fixed annuity. A variable annuity
becomes a better option depending upon age.
The huge unexpected benefit from our 2006 TIAA retirement deal was that our
fixed monthly annuity income was not affected by the economic crash of 2008 like
it would have been with a variable lifetime annuity. Since the stock market
eventually recovered such losses in monthly income would have eventually
recovered pretty well except for the losses before the stock market bounced
back.
It was just plain luck that I retired in 2006 rather than 2009. The decision
of the Federal Reserve to drive interest rates down to nearly zero coupled with
the Quantitative Easing program must have made it very difficult for TIAA to
offer fixed annuity deals after 2008 like the deal I negotiated in 2006.
However, I did not investigate the difference between the monthly annuity amount
I negotiated in 2006 with the amount I could have negotiated with TIAA in
2009.
Note that interest rates on safe investments like bonds and CDs have not
bounced back like the stock market. This is because of the damaging policies of
the Federal Reserve on the what used to be safer investments --- safer
investments that now return virtually zero. I don't look for safe investments to
return much of anything for a long, long time. The Fed has forced investors to
take on more financial risks with its low-interest policies that don't don't
seriously show signs of change in our troubled unemployment economy.
There are various other considerations when negotiating a retirement annuity,
some of which are discussed by Harvard's Justin Fox in the article below. I
listened carefully to the advantages and disadvantages of retirement annuities
that the TIAA counselor laid out for me before I signed on the dotted line. One
consideration for me was the 10-year grace period in which a declining balance
in our retirement fund balance goes into our inheritance estate if Erika and I
both die before 2016. After 2016 nothing of this balance goes into our estates
and if we live long enough TIAA takes a big hit. However, we felt that we had
sufficient outside savings to make our children sufficient bequests if we pass
on after 2016. Retirees without much in the way of outside savings might not
like this 10-year limit.
There are also other uncertainties. For example, there can be tax advantages
or disadvantages of lump-sum withdrawals at retirement. Investors who feel
almost certain that income taxes are going to become much higher in the future
might opt for a lump-sum payout. Those that think taxes will be lower are less
inclined to opt for the lump-sum payout, although there are other
considerations. For example, if I had taken a lump-sum payout I probably would
have invested most of the payout in an insured long-term tax exempt mutual fund
even though there are ups and downs in the values of such funds --- even though
the tax-free cash flows are fairly steady month-to-month.
I did not cover some of the points mentioned by Justin Fox in the article
below.
Always take advantage of the free investment counseling of your Personnel
Department and the companies trying to sell you a retirement annuity. Personally
I'm not a big fan of paying for investment advice since there are so many free
services from TIAA, Vangard, Fidelity, etc. Professionals in these outfits will
talk to you for free.
"What Do People Have Against Retirement Income?" by Justin Fox,
Harvard Business Review Blog, February 25, 2014 ---
http://blogs.hbr.org/2014/02/what-do-people-have-against-retirement-income/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+harvardbusiness+%28HBR.org%29&cm_ite=DailyAlert-022614+%281%29&cm_lm=sp%3Arjensen%40trinity.edu&cm_ven=Spop-Email
Bob Jensen's free investment helpers that may not be worth the price are
at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelper
"6
Retirement Accounts You Should Know
About (Part2)," by Laura Adams,
Money Girl, April 23, 2013, Episode
311 ---
http://moneygirl.quickanddirtytips.com/retirement-plan-types-pt2.aspx
Frontline broadcast on "The Retirement
Gamble,"April 23, 2013 ---
http://www.pbs.org/wgbh/pages/frontline/retirement-gamble/
For details see
http://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/retirement-gamble/the-retirement-gamble-facing-us-all/
If you’ve
been watching any commercial
television lately, you are well
aware that the financial services
industry is very busy running
expensive ads imploring us to worry
about our retirement futures. Open a
new account today, they say.
They are
not wrong that we should be doing
something: America is facing a
retirement crisis. One in three
Americans has no retirement savings
at all. One in two reports that they
can’t save enough. On top of that,
we are living longer, and health
care costs, as we all know, are
increasing.
But, as I
found when investigating the
retirement planning and mutual funds
industries in The Retirement Gamble,
which airs tonight on FRONTLINE,
those advertisements are imploring
us to start saving for one simple
reason. Retirement is big business —
and very profitable. It doesn’t take
a genius to figure out that the more
we save into the industry’s
financial products, the more money
they make in fees and commissions
trading our hard-earned cash. And as
long as they don’t run away with our
money or invest it in a Ponzi
scheme, they have little in the way
of accountability to us when
something goes wrong. And even then
it can be hard to fight back.
Big banks,
brokerages, insurance companies and
other financial service providers
operate under something called a
suitability standard — which says
they don’t have to give you the best
advice, just advice that isn’t too
egregiously terrible.
Let’s say
you sit down with an adviser at your
brokerage or bank and ask for some
advice on how you should allocate
your retirement savings, or which
funds you might want to choose for
your IRA.
You’ll get
lots of advice, but chances are it
won’t be worth much. Eighty five
percent of all financial advisers
and financial planners are really
just brokers or salesman. Their
incentive is to sell you a product
that makes them a higher commission,
not necessarily a product that
maximizes your chances of saving
more. Only 15 percent of advisers
are “fiduciaries” — advisers who by
law must operate with your best
interests in mind.
Last year,
the Obama administration proposed a
rule to mandate that all financial
advisers, financial planners and
other assorted financial wizards
would have to adopt a fiduciary
standard when it came to employee
retirement accounts such as your
401(k) or IRA account. The financial
services industry, which today
manages something upwards of $10
trillion of our retirement nest
eggs, thought this was a bad idea
and pushed back hard. Scores of
their protest letters poured into
the U.S. Labor Department, the
branch of our government responsible
for regulating employee retirement
accounts.
Congress,
too, was hit with a furious lobbying
campaign. This would be way too
expensive, the industry said; if we
have to provide such a standard of
service, we will either have to pack
up and find another business line,
or have to pass the increased costs
on to our customers. The Obama
administration pulled their proposal
last fall.
How would a
new fiduciary rule change things?
Chances are you would be sold less
expensive products, not only in your
IRA accounts but inside your company
401(k) as well. It’s all about fees.
While reporting on retirement plans
for FRONTLINE, nothing has been more
surprising to me than the corrosive
effect of fees on our retirement
savings.
It’s this
simple: Fund fees can erode as much
as half or more of your prospective
gains.
For the
sake of dramatizing the point, John
Bogle, founder of Vanguard, the
world’s largest mutual fund company
and pioneer of low-cost index funds,
gave me a startling example while we
were filming. Assume you are
invested in a mutual fund, he says,
with a gross return of 7 percent,
but that the mutual fund charges you
an annual fee of 2 percent.
Over a
50-year investing lifetime, that
little 2 percent fee will erode 63
percent of what you would have had.
As Bogle puts it, “the tyranny of
compounding costs” is overwhelming.
In short,
fees matter. So what can you do? You
aren’t going to find a fund that
invests your money for free, but
experts say you can come close by
buying index funds. Their fees can
be a tenth of what the average
mutual funds charges. And over time,
in bull and bear markets, on
average, index funds perform better
than their more expensive actively
managed fund cousins. This is no
secret to anyone who is paying
attention.
So why
aren’t our trusted financial
advisers and those ads telling us to
buy index funds? Why do some 401(k)
plans not even offer them on their
menus?
It’s
because even though an index fund
might be a better option for you and
me, a broker operating under a
suitability standard has no
incentive to sell it to us. He or
she will make higher commissions
from options that have higher fees.
Sadly, a
recent AARP study reported that 70
percent of mutual fund savers were
not even aware that they were paying
any fees at all.
Continued in article
Dan
Stone's summary of the above Frontline
show:
Enjoyed it though didn't find much
new here. Basic messages:
1. index funds are cheaper and, in
the long run, preferred (Jack Bogle)
2. managed funds are a scam to
generate fees for the mutual fund
industry
(which some would certainly debate)
3. most Americans don't have enough
for retirement
4. mutual funds make it hard to
determine their fees
5. the financial services industry,
through massive donations, prevents
any
attempts to increase transparency in
the financial services industry.
I've bought Pound Foolish, after
hearing an interview with its
author, but haven't
started reading it yet
(http://www.amazon.com/Pound-Foolish-Exposing-
Personal-Industry/dp/1591844894)
Dan
Stone
Bob Jensen's personal finance helpers
(but not his advice which is free and
not worth the money) ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Remember that my financial advice is
free and probably not worth the money.
After selling the family farm in Iowa
and my home in San Antonio, most of my
liquid savings is invested in an
enormous Vanguard Long-Term
"Guaranteed" Tax Exempt Fund.
"Apocalypse, Not Now, for Municipal
Bonds," by Randall W. Forsyth,
Barron's, April 23, 2013 ---
http://online.barrons.com/article/SB50001424052748703889404578438641361922074.html?mod=BOL_da_udwsd#articleTabs_article%3D0
$573.2 million in Munis defaulted in
2013 (0.6% of the $3.7 trillion
outstanding) versus 1.01% for 2013 .
My investment returns were very
satisfactory and stable throughout the
economic crisis that sent stocks
soaring.
At my age I care more about steady
annual tax-exempt cash flows rather than
valuation ups and downs and hyper
inflation risk.
When I need cash for something big like
a new tractor I simply write a Vanguard
check. I love the liquidity of this
fund.
Fortunately, however, my TIAA lifetime
annuities cover virtually all of our
living expenses, including payments on a
large mortgage.
I could write a Vanguard check to pay
off the mortgage, but there are tax
advantages of not doing so unless
unlikely tax reform clobbers tax exempt
interest income.
Sadly,
more than half of today’s U.S. retirees will rely on Social Security for more
than 50% of their total income, leaving them with the
painful choice of either a rather severe drop in living standards, or else
risking prematurely exhausting savings and being at the mercy of children or
relatives.
"Latest DALBAR report underscores poor long-term performance of individual
investors," The Mathematical Investor, July 2014 ---
http://www.financial-math.org/blog/2014/05/latest-dalbar-report-underscores-poor-long-term-performance-of-individual-investors/
As we
emphasized in a December 2013
Mathematical Investor blog,
individual
investors are not very well
equipped, and certainly not very
effective, in managing their own
investment portfolios.
This is
unfortunate, because fewer
workers than in the past,
particularly in the U.S., are
covered by a “defined-benefit”
retirement system, namely a
pension that guarantees a
certain proportion of one’s
income at retirement, based on
the number of years in service,
in perpetuity until one’s death.
Instead, the majority of the
growing army of American baby
boomers (according to the
Population Reference Bureau,
76.4
million Americans were born in
the period 1946-1966) have to
rely on 401K systems or the
equivalent, where they must
contribute (along with matching
contributions, in many cases, by
employers) to an investment fund
that they have either partial or
full discretion to manage.
Indeed, more than any generation
before, the present generation
of workers will be personally
responsible for their future
financial well-being.
Other nations are facing similar
challenges. In Canada, for
instance, their version of
“social security” provides only
about half what it does in the
U.S. In Australia, large
employers such as universities
typically place roughly 17% of a
worker’s income into a
“superannuation fund”. In New
Zealand, this fraction is 7%. In
Canada, pension savings are
taxed as they are withdrawn,
whereas in Australia
superannuation funds are not
taxed provided they are
withdrawn as annuities. In
continental Europe, mandatory
retirement rules still exist,
while in the English-speaking
world, such rules, mercifully,
are largely a thing of the past.
How well
are today’s workers doing in
saving for retirement? Sadly,
more than half of today’s U.S.
retirees will rely on Social
Security for more than 50% of
their total income,
leaving
them with the painful choice of
either a rather severe drop in
living standards, or else
risking prematurely exhausting
savings and being at the mercy
of children or relatives. Many
should at least
lower their expectations for
life after retirement, but there
is little evidence that most
workers nearing retirement are
facing this unpleasant reality.
Of even
greater concern is the level of
skill with which most individual
investors manage their nest
eggs. We mentioned in our
earlier
Mathematical Investor blog a
report known as the
Quantitative Analysis of
Investor Behavior, produced
by the
DALBAR organization, which
attempts to measure short- and
long-term success by individual
investors. In that blog, we
cited results from the 2012
report.
Now the
latest (2014) edition of
this report is available. So how
well are today’s investors
doing? The results are even more
discouraging than in previous
reports. The report notes that:
-
Over the past 20 years,
“equity fund” investors
achieved an average 5.02%
annualized return, which is
4.2% less than the 9.22%
that he/she could have
achieved by simply investing
funds in an S&P500
index-tracking fund. This
gap expanded in
2013, for only the third
time in ten years.
-
Over the bull market of the
past three years, “equity
fund” investors achieved
only an average 10.87%
annual return, lagging the
average annual S&P500 return
(16.18%) by 5.31%.
-
Investors in “asset
allocation funds” did even
more poorly. Their 20-year
average annual return was
only 2.53%, lagging the
S&P500 index (9.22% per
annum) by 6.69% per annum.
-
Investors in “fixed income
funds” did more poorly
still. Their 20-year average
annual return was an abysmal
0.71%, fully 8.51% less than
the S&P500 index, and 5.03%
per annum less than the
Barclay’s Aggregate Bond
Index (5.74% per annum) over
this time.
-
Not surprisingly, investors
show little evidence of
skill in “market timing.”
The DALBAR report notes that
in the six best months of
2013, when the market was up
sharply, there was no
evidence that individual
investors moved more than
average amounts into equity
funds.
As
MarketWatch commentator Paul
Merriman
observes,
the
typical investor’s emotion-based
trading in and out of securities
based on fear and knee-jerk
reaction to crises is
counter-productive to long-term
success:
Every year the conclusion
[of the DALBAR report] is
the same: On average,
investors earn less than
mutual fund performance
figures imply. Sometimes
they earn much less. … One
conclusion: No matter
whether the market is
booming or busting,
“Investor results are more
dependent on investor
behavior than on fund
performance.” Investors who
buy and hang on are
consistently more successful
than those who move in and
out of the markets.
In our
previous
Mathematical Investor blog,
we
emphasized how the typical
individual investor is
relatively poorly educated and
informed about making personal
financial decisions. As the U.S.
Securities and Exchange
Commission noted in a
2012 report, “investors
have a weak grasp of elementary
financial concepts and lack
critical knowledge of ways to
avoid investment fraud.”
These
experiences are exacerbated by
the larger plague of
disappointing performance in
mathematics and science
education. This was underscored
today with the release of the
latest results for U.S. 12th
graders on the
National Assessment of
Educational Progress (NAEP) test.
The
overall score of 153 in
mathematics is identical to that
from 2009, and is only slightly
higher than the 150 score in
2005, in spite of years of
effort and billions of dollars
spent to improve K-12 education.
The DALBAR report concludes
Attempts to correct
irrational investor behavior
through education have
proved to be futile. The
belief that investors will
make prudent decisions after
education and disclosure has
been totally discredited.
Instead of teaching,
financial professionals
should look to implement
practices that influence the
investor’s focus and
expectations in ways that
lead to more prudent
investment decisions.
Similarly,
Louis S. Harvey, President of
DALBAR,
argues
that
It is now past the time for
the investment community and
its regulators to understand
that the principle of
educating uninterested
investors about the
complexities of investing is
unproductive. … We need a
fundamental change that
transforms investment
thinking into meaningful
decisions and choices for
retail investors.
[Added 12
May 2014: A
column
by Chuck Jaffe summarizes a
study by Natixis Global Asset
Management on why investors
often make poor financial
decisions.]
"The Science Behind Social Security Benefits Calculations," by
Theodore J. Sarenski, AICPA, October 20, 2014 ---
http://blog.aicpa.org/2014/10/the-science-behind-social-security-benefits-calculations.html#sthash.t77ImEv5.i4UykguJ.dpuf
While the
Social Security Administration
calculates Social Security benefits,
it is your due diligence to know the
basics so that you can understand
how an additional year of earning
will affect your clients’ projected
benefit.
Continued in article-
Jensen Comment
This is more about understanding the
regulations than science. The
regulations are a bit complicated.
"Offering
a Helping Hand on Retirement Savings:
New Website Provides Investment Novices
Free Portfolio Recommendations; Asking
Questions of the CEO," by Katherine
Boehret, The Wall Street Journal,
June 5, 2012 ---
http://professional.wsj.com/article/SB10001424052702303506404577448503218010424.html
How often do you tinker with your
retirement savings? Many people
think about this when starting a job
or opening a 401(k), but sometimes
not again until they are ready to
retire. According to financial
advisers, that's too late.
This week, I forced myself to look
at accounts I rarely monitor as I
tested FutureAdvisor.com, a website
founded by two former Microsoft
engineers who are also a registered
investment adviser and chartered
financial analyst, respectively.
They wanted to create an easy way
for people to manage their
retirement savings, primarily using
index funds, and they based the
site's suggestions on what they
consider to be the best practices in
the industry and in academia.
FutureAdvisor, which has no ads,
bills itself as a free alternative
to paying a lot for financial advice
from professionals, who often charge
a 1% annual fee or work on
commission. Many big investment
firms offer retirement-savings
services, but these generally don't
offer step-by-step advice for an
investor's complete portfolio.
FutureAdvisor expects to make money
when it introduces later this year
an optional premium service, which
will charge an annual fee of less
than 0.25% of your assets to
rebalance and maintain your
portfolio, automatically. It says
suggestions offered on the site are
made solely on merit, with no
kickbacks or commissions to
FutureAdvisor.
The site differs from budgeting
sites like Mint.com that don't
specialize in retirement savings.
Instead, Mint makes money through
recommendations for users, like
which credit cards carry lower fees.
I'm not a financial expert; rather,
I looked at FutureAdvisor through
the lens of an average person who
might want to use the site. Its
investment philosophy may not be
right for everybody.
FutureAdvisor is easy to use and
walks users through a set of simple
steps. There's no asset minimum to
use the site, though people who are
already in retirement can't use it.
Pop-up explanations and options to
submit questions to the site's CEO
and co-founder, a registered
investment adviser, are available as
you go.
For security purposes, FutureAdvisor
uses bank-level, 128-bit SSL (Secure
Socket Layer) encryption for all
communications. It can't move money
or make transactions; instead,
people do this by clicking on links
that send them to their financial
institutions where they may pay a
fee for certain transactions. Login
information is never stored on the
website; rather, it's handled by
partner company Yodlee.
To get started with FutureAdvisor, I
entered my email and a password to
create an account and then answered
questions about myself. These
included birthday, current annual
income, desired retirement age,
desired retirement income, age when
I started consistently saving for
retirement, approximate value of my
retirement investments and marital
status. Thankfully, messages that
say, "What is this?" appear beside
each question, explaining why it's
asked.
Next, you enter the names of
brokerage firms that handle your
accounts, like Fidelity for a 401(k)
or T. Rowe Price for a Roth IRA. If
you don't already have online
accounts with each of these firms,
you must set up accounts on their
websites so you can return to
FutureAdvisor, enter your username
and password and access your data.
FutureAdvisor recognized a lot of
different brokerage firms that I
searched for, and this week it added
Thrift Savings Plans, or TSPs, which
are used by government employees,
including military personnel. If a
brokerage firm isn't on the site,
you can suggest it in a feedback
box. I did this, and my requested
firm was added within hours.
When personal questions are answered
and brokerage-firm information is
retrieved, FutureAdvisor asks you to
choose a conservative, moderate or
aggressive approach with
explanations of each. I chose an
aggressive option because of my
relatively young age. Various charts
filled the screen showing
recommendations for my stock/bond
split, equity style, diversification
split and glide style. Terms like
this may lose average users, but
brief explanations beside them
helped, and I read a References and
Citations pop-up menu filled with
sources from which the advice was
generated.
The most helpful section of the site
showed recommendations for my
portfolio.
Continued in article
FutureAdvisor ---
https://www.futureadvisor.com/
-
"(More) Clarity on Adjunct Hours
(including healthcare insurance
guidance)," by Doug Lederman, Inside
Higher Ed, February 11, 2014 ---
http://www.insidehighered.com/news/2014/02/11/irs-guidance-health-care-law-clarifies-formula-counting-adjunct-hours
The Obama
administration on Monday
released its long-awaited final
guidance
on how colleges should calculate the
hours of adjunct instructors and
student workers for purposes of the
new federal mandate that employers
provide health insurance to those
who work more than 30 hours a week.
The upshot
of the complicated regulation from
the Treasury Department and the
Internal Revenue Service:
-
On adjuncts,
colleges will be considered on
solid ground if they credit
instructors for 1 ¼ hours of
preparation time for each hour
they spend in the classroom, and
instructors should be credited
for any time they spend in
office hours or other required
meeting time.
-
On student workers,
the IRS
opted to exclude work-study
employment from any count of
work hours, but the
administration declined to
provide an exemption for student
workers over all. As a result,
colleges and universities will
be required to provide health
insurance to teaching and
research assistants who work
more than 30 hours a week.
Adjunct Hours
The issues
of how to count the hours of
part-time instructors and student
workers have consumed college
officials and faculty groups for
much of the last 18 months, ever
since it became clear that the
Affordable Care Act definition of a
full-time employee as working 30
hours or more a week was leading
some colleges to
limit the hours
of adjunct
faculty members, so they fell short
of the 30-hour mark.
All that
the government said in its
initial
January 2013 guidance
about the employer mandate under the
health care law was that colleges
needed to use "reasonable" methods
to count adjuncts' hours.
In
federal testimony
and at
conferences,
college
administrators and
faculty advocates
have debated
the appropriate definition of
"reasonable," with a focus on
calculating the time that
instructors spend on their jobs
beyond their actual hours in the
classroom. The American Council on
Education, higher education's
umbrella association and main
lobbying group, proposed a ratio of
one hour of outside time for each
classroom hour, while many faculty
advocates have pushed for a ratio of
2:1 or more.
In its new
regulation, published as part of a
complex 227-page final rule in
today's Federal Register,
the government said that it would be
too complex to count actual hours,
and it rejected proposals to treat
instructors as full time only if
they were assigned course loads
equivalent or close to those of
full-time instructors at their
institutions.
The
administration continued to say that
given the "wide variation of work
patterns, duties, and circumstances"
at different colleges, institutions
should continue to have a good deal
of flexibility in defining what
counts as "reasonable."
But in the
"interest of predictability and ease
of administration in crediting hours
of service for purposes" of the
health care law, the agencies said,
the regulation establishes as "one
(but not the only)" reasonable
definition a count of 2.25 hours of
work for each classroom hour taught.
"[I]n addition to crediting an hour
of service for each hour teaching in
the classroom, this method would
credit an additional 1 ¼ hours
service" for "related tasks such as
class preparation and grading of
examinations or papers."
Separately,
instructors should also be credited
with an hour of service for each
additional hour they spend outside
of the classroom on duties they are
"required to perform (such as
required office hours or required
attendance at faculty meetings," the
regulation states.
The
guidance states that the ratio --
which would essentially serve as a
"safe harbor" under which
institutions can qualify under the
law -- "may be relied upon at least
through the end of 2015."
By choosing
a ratio of 1 ¼ hours of additional
service for each classroom hour, the
government comes slightly higher
than the 1:1 ratio that the higher
education associations sought, and
quite a bit lower than the ratio of
2:1 or higher promoted by many
faculty advocates.
David S.
Baime, vice president for government
relations and research at the
American Association of Community
Colleges, praised administration
officials for paying "very close
attention to the institutional and
financial realities that our
colleges are facing." He said
community colleges appreciated both
the continued flexibility and the
setting of a safe harbor under
which, in the association's initial
analysis, "the vast majority of our
adjunct faculty, under currernt
teaching loads, would not be
qualifying" for health insurance,
Baime said.
Maria
Maisto, president and executive
director of New Faculty Majority,
said she, too, appreciated that the
administration had left lots of room
for flexibility, which she hoped
would "force a lot of really
interesting conversations" on
campuses. "I think most people would
agree that it is reasonable for
employers to actually talk to and
involve employees in thinking about
how those workers can, and do,
perform their work most effectively,
and not to simply mandate from above
how that work is understood and
performed," she added.
Maisto said
she was also pleased that the
administration appeared to have set
the floor for a "reasonable" ratio
above the lower 1:1 ratio that the
college associations were
suggesting.
She
envisioned a good deal of confusion
on the provision granting an hour of
time for all required non-teaching
activities, however, noting that her
own contract at Cuyahoga Community
College requires her to participate
in professional development and to
respond to students' questions and
requests on an "as-needed basis."
"How does this regulation account
for requirements like that?" she
wondered.
Student Workers
The adjunct
issue has received most of the
higher education-related attention
about the employer mandate, but the
final regulations have significant
implications for campuses that
employ significant numbers of
undergraduate and graduate students,
too.
Higher
education groups had urged the
administration to exempt student
workers altogether from the employer
mandate, given that many of them
would be covered under the health
care law's policies governing
student health plans and coverage
for those up to age 26 on their
parents' policies. The groups also
requested an exemption for students
involved in work study programs.
The updated
guidance grants the latter exemption
for hours of work study, given, it
states, that "the federal work study
program, as a federally subsidized
financial aid program, is distinct
from traditional employment in that
its primary purpose is to advance
education."
But all
other student work for an
educational organization must be
counted as hours of service for
purposes of the health care mandate,
Treasury and IRS said.
Steven
Bloom, director of federal relations
at the American Council on
Education, said higher ed groups
thought it made sense to exempt
graduate student workers, given that
their work as teaching assistants
and lab workers is generally treated
as part of their education under the
Fair Labor Standards Act. He said
the new guidance is likely to force
institutions that employ graduate
students as TAs or research
assistants -- and don't currently
offer them health insurance as part
of their graduate student packages
-- to start counting their hours.
The
guidance also includes a potentially
confounding approach to students who
work as interns. The new regulation
exempts work conducted by interns as
hours of service under the health
care employer mandate -- but only
"to the extent that the student does
not receive, and is not entitled to,
payment in connection with those
hours."
Continued in article
Jensen Question
How should a university account for a
doctoral student who happens to teach 33
hours one semester and works less than
30 hours in all other semesters of the
doctoral program? Is the university
required to provide health coverage for
zero, one, or more years while the
student is a full time student in the
doctoral program? I assume the
university must provide health insurance
for one year, but I'm no authority on
this issue.
There also is a huge difference in
hours of work required for teaching. A
doctoral student who only teaches
recitation sections under a professor
who provides the lecture sections,
writes the syllabus, writes the
examinations, and essentially owns a
course versus a doctoral student who
owns only section of governmental
accounting with no supervision from a
senior instructor.
When I was Chair of the Accounting
Department at Florida State University,
the wife (Debbie) of one of our doctoral
students (Chuck Mulford) had total
control of the lectures and 33
recitation sections of basic accounting
each semester where most of the
recitation "instructors" were accounting
doctoral students. Debbie had her CPA
license and a masters degree, but she
was not a doctoral student. She was very
good at this job. The recitation
instructors had almost no preparation
time and did not design or grade the
examinations. They did not own all 33
sections like Debbie owned all 33
sections. It would be a bit unfair to
give the recitation instructors as much
pay for preparation as the selected
doctoral students who taught more
advanced courses and essentially owned
those courses in terms of classroom
preparation and examinations.
Bob Jensen's threads on
controversies in higher education
(including use of adjuncts) ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm
"The Law About Debt Collections
Harassment," by Laura Adams,
Money Girl, May 21, 2013 ---
http://moneygirl.quickanddirtytips.com/debt-collections-harassment.aspx
Teaching Case
From The Wall Street Journal Accounting Weekly Review on January 10, 2014
Delaying IRA
Contributions Can Be Costly
by: Jonnelle Marte
Jan 05, 2014
Click here to view the full article
on WSJ.com
TOPICS: Individual
Income Taxation, Individual
Taxation, IRA Contributions, IRAs
SUMMARY: Taxpayers
can contribute up to $5,500 each
year to individual retirement
accounts--$6,500 for those over 50.
"An analysis of traditional and Roth
IRA contributions made by Vanguard
Group customers for the 2007 through
2012 tax years showed that, on
average, 41% of the dollars
contributed to IRAs for any given
tax year are invested between
January and April of the following
year. Half of those dollars are
contributed in the first half of
April...and only 10% of dollars are
contributed in January of the
corresponding tax year...." A time
value of money comparison in the
article shows that this habit-which
most advisers think stems from
investor laziness-can cost a
substantial difference in final
savings available at retirement
CLASSROOM APPLICATION: The
article may be used in a class on
personal taxes or when covering
topics in the time value of money.
QUESTIONS:
1. (Advanced) What is an
individual retirement account? A
Roth IRA?
2. (Advanced) According to
tax law, when are taxpayers allowed
to make IRA deductions?
3. (Introductory) According
to findings by Vangauard Group from
analyzing their customer deposits to
IRA accounts, when do most taxpayers
make IRA contributions?
Reviewed By: Judy Beckman,
University of Rhode Island"
"Delaying IRA Contributions Can Be
Costly," by Jonnelle Marte, The Wall
Street Journal, January 5, 2014 ---
http://online.wsj.com/news/articles/SB10001424052702304477704579256610849790176?mod=djem_jiewr_AC_domainid
It's a new
year. And that means it's time for
investors to do what they could have
done last year—but didn't.
Namely:
make contributions to their 2013
individual retirement accounts.
Indeed, an analysis of traditional
and Roth IRA contributions made by
Vanguard Group customers for the
2007 through 2012 tax years showed
that, on average, 41% of the dollars
contributed to IRAs for any given
tax year are invested between
January and April of the following
year. Half of those dollars are
contributed in the first half of
April—the final weeks when
contributions for the previous year
can be made.
The study
found only 10% of dollars are
contributed in January of the
corresponding tax year, the earliest
month contributions can be made. "We
are trying to encourage people to
change their way of thinking and
think about it sooner," says Maria
Bruno, a senior investment analyst
with Vanguard Investment Strategy
Group. Valid Excuse?
There are
legitimate reasons that big dollars
flow into IRAs near the tax-filing
deadline. At that point, taxpayers
typically know whether their income
for the prior year was low enough to
qualify for deductible
contributions, and can see by
exactly how much a contribution
would lower their tax bill.
But some
advisers say the habit is one of the
ultimate examples of investor
laziness, nearly on par with not
maxing out the company match for
401(k) contributions or not seeking
retirement advice until after
retirement.
"As humans
we naturally procrastinate," says
Mackey McNeill, an accountant and
financial adviser in Bellevue, Ky.
Procrastination can be costly. The
problem, advisers and retirement
consultants say, is that investors
who make IRA contributions at the
last moment miss out on 16 months of
potential gains (from January of one
year until April of the following
year), as well as the chance for
those gains to compound over many
years. Even if two investors
contribute the same amount of money
over the years, the person who
starts earlier could end up with
significantly more savings down the
line.
Compare a
saver who makes the maximum annual
IRA contribution of $5,500 for those
under age 50 in January of each year
with another saver who contributes
the same amount each April 15 of the
following year. Over 31 years,
assuming the money is invested in a
moderate portfolio earning a
hypothetical 7% annual return, the
saver who makes full contributions
in January could end up with $83,000
in additional savings after 30
years, even though both investors
contributed equal amounts—about
$170,500—overall, according to an
analysis by Ms. McNeill. Tax Burden
Another
downside to putting off
contributions: It could add to your
tax bills. Money in a taxable
account over that 16-month period
may incur gains that would have been
deferred in an IRA, says Ed Slott,
an accountant and founder of
IRAHelp.com, a website for
retirement savers.
Some pros
say investors' excuses for not
contributing as early as possible
are looking thin. Most people don't
see their income swing wildly from
one year to the next, Ms. Bruno
says. They can likely use last
year's tax return to decide whether
to make a contribution for the
current tax year each January.
Procrastinators still have time to
change their ways. Some can catch up
if they now make their 2013 and 2014
contributions—a total of $11,000 for
those under 50 contributing the
maximum for each year, Ms. McNeill
says. Those investors can then get
in the habit of making their IRA
contributions at the start of each
year. (Investors 50 or older can
contribute as much as $6,500 to
their IRAs each year.)
While a
doubled-up contribution is a lot to
set aside at once, she says: "You've
only got to make this change for one
year."
Controversy and Scandal Surrounding
John Hancock and the Compounding of Interest
"Our signature 1776 revolutionary: John Hancock's role as treasurer
left an uneasy Harvard," Harvard Gazette, July 2, 2013 ---
http://news.harvard.edu/gazette/story/2013/06/our-signature-1776-revolutionary/
Jensen Comment
To this day, many people in the USA do
not understand the difference between
simple interest versus annual
compounding versus continuous
compounding ---
http://en.wikipedia.org/wiki/Compound_Interest
Except for very long holding periods,
continuous compounding does not add all
that much to annual compounding. But
compounding adds a huge amount relative
to simple interest.
For example, if the Lenape Indians in
1626 had invested the $24 they received
for Manhattan at 6% compounded annually
they could perhaps buy the island back
in 2013 for the accumulated savings of
$149,135,522,178.18. In my first
course in economics this was a footnote
in the famous textbook by Paul Samuelson
(with slightly different numbers). If
this was indexed over time for inflation
and exempt from taxation the Lenapes
could perhaps buy the entire State of
New York in 2013.
It's no wonder that in 1793 Harvard
University badly wanted $529 accumulated
compound interest owed by the John
Hancock estate.
"Wallet.AI Aims to Serve Up
Location-Based Financial Advice: An app called Wallet.AI wants to put a
financial advisor in your pocket," by Rachel Metz,
MIT's Technology Review, September 23, 2013 ---
Click Here
http://www.technologyreview.com/news/519346/walletai-aims-to-serve-up-location-based-financial-advice/?utm_campaign=newsletters&utm_source=newsletter-daily-all&utm_medium=email&utm_content=20130924
Mortgage Rate Calculation Tools
---
http://www.mortgagerates.net/additional-resources/calculation-tools/
Bob Jensen's threads on online
calculators ---
http://faculty.trinity.edu/rjensen/Bookbob3.htm#080512Calculators
Smart About Money - National Endowment
for Financial Education ---
http://www.smartaboutmoney.org/
"Teach Financial Literacy,"
by Steven Bahls, Chronicle of Higher Education, June 13, 2011 ---
http://www.insidehighered.com/views/2011/06/13/essay_on_responsibility_of_colleges_to_teach_financial_literacy
As
a college president, I ask students
and graduates what are we doing
correctly and what can we improve
upon. The typical responses to how
we can improve are not surprising —
more parking and more financial aid
(often in that order). Lately the
most common answer from recent
graduates as to how we can improve
has been surprising — more education
about financial literacy and the
practical aspects of living in
today’s world.
I hear the following comments with
increasing frequency, particularly
since the Great Recession of 2008:
-
had no idea of the impact of my
student debt and credit card
debt on my ability to live a
comfortable life after college.
-
Living in the residence halls
and dining at the college, I
didn’t need to know about
budgeting and renting an
apartment. I had no idea how to
create a budget so I could live
responsibly and comfortably on
my salary.
-
In college I learned how to
cultivate a pointed argument,
but quickly learned that in the
workplace an aggressive argument
can get you fired. No one told
me about how to disagree with
your boss and not have your job
threatened.
Faculty and administrators at
liberal arts colleges do not shy at
complex thinking. We tend to
scrutinize the details even as we
comprehend the big picture. We look
for connections among areas of
thought, and revel in a multitude of
perspectives. By the end of their
four years on campus, our students
have benefited from a well-rounded,
richly layered education. I believe
most even recognize what it means to
be liberally educated. Having
learned to "turn the crystal" as
they develop their views and goals,
they are confident and able to find
success on many levels.
Why then do so many recent graduates
seem unable to demonstrate sound
decision-making in an area as
fundamental as finances and entering
the work world?
Is it possible that in our efforts
to foster creative and critical
problem solving, we neglect the
basics of responsible day-to-day
living and working? As we carefully
engage students in discerning shades
of gray, is it at the expense of
black and white?
Two events have led me to ask these
questions. First is the number of
conversations like those described
above, with graduates who confided
to me their frustrating lack of
“real-world” financial knowledge.
The second is the fact of the high
loan default rate among recent
college graduates, which is 7
percent nationwide (Augustana’s rate
is 4.2 percent). I know I am not
alone in asking the question: What
should we do?
Personal Prosperity and the
Common Good
Jon Meacham, the former editor of
Newsweek, addressed the 2011
Council of Independent College
Presidents Institute. Meacham
praised the role of liberal
education, noting that "people who
know about Shakespeare tend to
create the Internet." But if
appreciating Shakespeare and other
skills common to a liberal education
is viewed by most as "quaint and
quirky," liberal education will not
survive. Instead, he argues that
liberal education must be "vital and
relevant" by "training young minds
to solve problems and to see what
others have yet to see and to think
energetically about creating jobs
and wealth," which Meacham calls the
"oxygen of democracy."
I'd go one step further than
Meacham. Our graduates can’t create
wealth and jobs if they don’t have
the ability to balance a checkbook,
or the skills to hold a job.
When asked to define "personal
success," I think it is fair to
suggest that most college freshmen
would put "financial success" toward
the top of their list. As they begin
taking liberal arts courses, they
connect their learning to other
aspects of their lives, and many
begin to think of a career as
something more than just a paycheck.
They develop meaningful working
relationships with faculty members
and other students, and may
experience some peaks in their
education — whether through an
internship, international study,
research with faculty or other
achievements in their major studies.
Their definition of success develops
more facets.
At Augustana College, we have long
promoted high-impact learning
experiences as well as the close
relationships that allow integrated
and collaborative learning to
flourish. Recently we have begun to
take new steps toward teaching
certain life skills fundamental to
ensuring success of all kinds.
Leadership about financial literacy
must come from the top. I remind our
students that if they live like
college graduates with good jobs
while they are students, their debt
levels will cause them to live like
students when they graduate. Going
out to a mid-priced restaurant twice
a week for four years could easily
cost $8,000. Putting those charges
on a credit card and carrying the
balance over four years tips the
cost to well over $10,000.
Five years ago, before the severe
economic downturn, we introduced a
class on personal finance. Offered
each spring and fall term, the class
is packed with seniors and some
juniors. Having read Plato and
Neruda, spent hours upon hours
working in our human cadaver or
volcano lab, or climbed Machu
Picchu, these students suspect they
must improve their financial
literacy before they graduate.
Their instructor, an alumnus retired
banker, begins by teaching how to
use financial templates. The
students create a personal profile
and then produce a cash flow
statement for the previous year.
After clarifying their own
understanding of their financial
history, which generally is filled
with gaps until this class, they
work with their instructor on the
process of creating a budget for the
next year. Taking into account three
to four personal financial goals
(e.g., paying for students loans,
emergency funds, etc., and even
retirement), the students lay their
financial path for the future. At
all times throughout the class they
keep in mind their current net
worth, and how that value should
affect their financial decisions.
The course is such a success that,
given the financial illiteracy
demonstrated by too many young
alumni, we now are offering a free
three-hour seminar as a "crash
course" in personal finance for our
graduating seniors.
Sharing Responsibility
Augustana is not the only liberal
arts college to offer such a class,
and there is more we all can do.
Many liberal arts colleges are
adding majors that address personal
financial viability in a changing
world and also attract prospective
students in an increasingly
competitive market.
Augustana’s
newest majors — which extend from
traditional majors — include graphic
design, neuroscience, environmental
studies, multimedia journalism and
engineering physics, among others.
While some of our faculty state
concerns that our college’s liberal
arts foundation might be shaken by
the contemporary and perhaps more
fiscal focus of these programs,
most see the new majors as logical
progressions
of traditional
fields and therefore deeply related
to our college’s mission.
Continued in article
Bloomberg Business Week asked that I
share the following links with you:
1.
Personal Finance News:
http://www.bloomberg.com/personal-finance/
2. Saving and Investing:
http://www.bloomberg.com/personal-finance/saving-and-investing/
3. Retirement Planning:
http://www.bloomberg.com/personal-finance/retirement-planning/
4. Real Estate Investing:
http://www.bloomberg.com/personal-finance/real-estate/
5. Tax News:http://www.bloomberg.com/personal-finance/taxes/
6. Financial Advisers:
http://www.bloomberg.com/personal-finance/financial-advisers/
7. Insurance and Health:
http://www.bloomberg.com/personal-finance/insurance-and-health/
8. Financial Calculators:
http://www.bloomberg.com/personal-finance/calculators/
9. Businessweek Magazine Online:
http://www.businessweek.com/subscribe/
I also
added the Financial Calculators link to
http://faculty.trinity.edu/rjensen/Bookbob3.htm#080512Calculators
I added
the tax news to
http://faculty.trinity.edu/rjensen/AccountingNews.htm#News
Inside Footnotes (advice from and for security analysts) ---
http://www.footnoted.com/inside-footnotes/
"What’s Wrong with the Financial
Services Industry?" by Barry
Ritholtz, Ritholtz Blog, February
21, 2013 ---
http://www.ritholtz.com/blog/2013/02/whats-wrong-with-the-financial-services-industry/
If you hang
around these parts for any length of
time, you will occasionally run
across a jeremiad of mine
complaining about the Financial
Services Industry.
I’ve been
thinking about this more than usual
lately. This has led to some
correspondence with Helaine Olen,
whose book
Pound Foolish: Exposing the Dark
Side of the Personal Finance
Industry
is next up in my queue. (Her
appearance on the
TDS yesterday is here).
It is similar
to the deep dive my colleague Josh
Brown took in
Backstage Wall Street.
My
criticism is somewhat different than
Helaine’s (though I am sympatico
with much of her view). I break down
the problems as follows:
•
Simplicity does not pay well:
Investing should be relatively
simple: Buy broad asset classes,
hold them over long periods of
time, rebalance periodically,
get off the tracks when the
locomotive is bearing down on
you. The problem is its easier
in theory than is reality to
execute this.
•
Confusion is not a bug, its a
feature: Thus,
the massive choice, the nonstop
noise the confusing claims, all
work to make this much more
complex than it needs to be.
•
Too much money attracts the
wrong kinds of people:
Let’s face it, the volume of
cash that passes through the
Financial Services Industry is
enormous. Few who enters finance
does so for altruistic reasons.
•
Incentives are
misaligned: As
I’ve written previously, too
many people are unwilling to get
rich slowly. Hence, some of the
wrong people work in finance,
and some of the right people
exercise bad judgment.
•
Too many people have a hand in
your pocket:
The list of people nicking you
as an investor is enormous.
Insiders (CEO/CFO/Boards of
Directors) transfer wealth from
shareholders to themselves, with
the blessing of corrupted
Compensation Consultants. Active
mutual funds charge way too much
for sub par performance. 401(k)s
are disastrous. NYSE and NASDAQ
Exchanges have been paid to
allow a HFT tax on every other
investor. FASB and Accountants
have doen an awful job, allowing
corporations to mislead
investors with junk balance
statements. The Media’s job is
to sell advertising, not provide
you with intelligent advice. The
Regulators have been captured.
What’s the net impact of all
this on your investments ?
•
The Financialized US Economy:
The above list reflects nearly
half a century of the
financialization of the broader
US economy. Instead of serving
industry, finance has trumped
it. This led directly to the
financial crisis and economic
collapse of 2007-09.
•
Human Nature:
Then there is your own
behavioral issues. On top of
everything else, you are
governed by a
brain that simply wasn’t built
for this.
All of
these add up to a system that is
flawed, and often fails to do its
job.
Continued in article
Large public accounting firms are
probably not in favor of simplifying the
tax code
February 17, 2013 message from Richard
Sansing
This week's
issue of The Economist has a special
report on
off-shore finance. This article
discusses the role of large
public accounting firms.
http://www.economist.com/news/special-report/21571556-accounting-firms-will-do-nicely-under-any-set-rules-merry-enablers
Jensen Content
Note that
"simplicity does not pay well" in
consulting!
I wonder to what extent large CPA firms
want simplified accounting and auditing
rules (to increase profits on audits)
and highly complex regulations and
financing alternatives (to increase
profitability of consulting). Thus far
in the 21st Century everything seems to
becoming more complicated., which is
probably why audits are not especially
profitable relative to consulting.
However, unless a new regulation is
put in place to rotate audit firms,
auditing contributes heavily to fixed
costs annually due to the tendency of
clients to stick with the same auditing
firms year after year. Consulting
engagements come and go making them not
especially reliable for paying fixed
costs but making them profitable on top
of the fixed costs paid for by audit
engagements. Thant's my $.02.
Definition of Screwed:
avg mkt return ~12%, avg mutual fund ret ~9%, average investor ret ~ 2.6%.
Timing, selection, and costs destroy
Finance Professor Jim Mahar
"Romancing Alpha (α), Breaking Up with Beta (β)," by Barry Ritholtz,
Ritholtz, February 15, 2013 --- |
http://www.ritholtz.com/blog/2013/02/alpha-beta/
Since it is a Friday (following Valentine’s Day), I
want to step back from the usual market gyrations to discuss a broader
topic: The pursuit of Alpha, where it goes wrong, and the actual cost in
Beta.
For those of you unfamiliar with the Wall Street’s
Greek nomenclature, a quick (and oversimplified) primer: When we refer to
Beta (β), we are referencing a portfolio’s correlation to its benchmark
returns, both directionally and in terms of magnitude.
We use a scale of 0-1. Let’s say your benchmark is
the S&P500 — it has a β = 1. Something uncorrelated does what it does
regardless of what the SPX does, and its Beta is = 0. We can also use
negative numbers, so a Beta of minus 1 (-1) does the exact opposite of the
benchmark.
Beta measures how closely your investments perform
relative to your benchmark. If you were to do nothing else but buy that
benchmark index (i.e., S&P500), you will have captured Beta (for these
purposes, I am ignoring volatility).
The other Greek letter we want to mention is Alpha
(α). Alpha is the risk-adjusted return of active management for any
investment. The goal of active management is through a combination of
stock/sector selection, market timing, hedging, leverage, etc. is to beat
the market. This can be described as generating Alpha.
To oversimplify: Alpha is a measure of
out-performance over Beta.
Why bring this up today?
Over the past few months, I have been looking at an
inordinate number of portfolios and 401(k) plans that have all done pretty
poorly. I am not referring to any one quarter of even year, but rather, over
the long haul. There is an inherent selection bias built into this group —
well performing portfolios don’t have owners considering switching asset
managers. But even accounting for that bias, a hefty increase in the sheer
number of reviews leads me to wonder about just how widespread the
under-performance is.
One of the things that has become so obvious to me
over the past few years is how unsuccessful various players in the markets
have been in their pursuit of Alpha. We know that 80% or so of mutual fund
managers underperform their benchmarks each year. We have seen Morningstar
studies that show of the remaining 20%, factor in fees, and that number
drops to 1%.
The overall performance of the highest compensated
group of managers, the 2%+20% Hedge Fund community, has been similarly
awful, as they have underperformed for a decade or more.
Continued in article
Department of Labor (DOL) ---
http://en.wikipedia.org/wiki/United_States_Department_of_Labor
"EBSA
Cracks Down on Retirement Plan Advisors:
Advisors take heed: The DOL arm that
rides herd over retirement plans is
ramping up its enforcement efforts," by
Melanie Waddell, AdvisorOne, March 26,
2012 ---
http://www.advisorone.com/2012/03/26/ebsa-cracks-down-on-retirement-plan-advisors?t=legal-compliance
Prominent retirement planning
officials are warning advisors to
make sure that the retirement plans
they advise are compliant with
Department of Labor rules, as the
DOL’s regulatory arm responsible for
policing these plans is cracking
down.
So far this year, the DOL’s Employee
Benefits Security Administration (EBSA)
has significantly raised its
enforcement efforts in what Andy
Larson, director of the Retirement
Learning Center, says should serve
as a wake-up call to advisors who
advise retirement plans and plan
sponsors.
In 2011, EBSA said it had closed
3,472 civil cases and obtained
monetary results of nearly $1.39
billion. EBSA also closed 302
criminal cases that resulted in 129
individuals being indicted and 75
cases being closed with guilty pleas
or convictions. DOL also wants to
increase the number of its
enforcement personnel from 913 to
1,003 this year.
Larson says those EBSA enforcement
numbers are “astonishing” and warns
that many advisors are surprisingly
still unaware that the DOL has
jurisdiction over them.
What’s the biggest area EBSA is
zeroing in on? Fiduciary negligence.
EBSA is “seeing very high levels of
non-compliance with fiduciary”
duties. When the EBSA releases its
reproposed fiduciary rule in the
first half of this year, the rule
“will affect advisors and their
fiduciary role,” not plan sponsors,
Larson says.
In light of this, Larson said,
advisors should ensure they have a
“strong documentable fiduciary
process.”
As Larson notes, since the Employee
Retirement Income Security Act (ERISA)
was put into place, DOL and the
Internal Revenue Service’s Employee
Plans Unit have had joint authority
“to ride herd” over retirement
plans. But service providers have
gotten accustomed to the IRS taking
the lead in enforcement actions, and
have failed to notice over the last
two years that the EBSA “is showing
up through the unlocked back door
and finding problems,” Larson says.
Because the IRS has been the primary
enforcer of ERISA rules, “service
providers have developed their
models to include mechanisms with
IRS requirements,” but may have
failed to include “DOL-type
protections in their service
models,” Larson says.
Continued in article
Bob Jensen's helpers (not advice) for
personal finance ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
"The
Truth About Paying Down Your Mortgage
Early," Business Insider,
June 21, 2013 ---
http://www.businessinsider.com/paying-off-mortgage-with-leftover-money-2013-6
Jensen Comment
Much depends on what your intend to do
with the funds that you would otherwise
use to pay down part or all of your
mortgage. If it all goes to wine, women,
and casino gambling then pay down at
least part of your mortgage. If it goes
to buy gold coins then pay down your
mortgage (I'm against buy gold coins in
any circumstances since the transactions
costs on resale are so high). If
it goes for home improvements the answer
is uncertain and depends upon your
particular real estate market and how
much those improvements add to the
monetary and personal value of your
home.
Of
course your particular income, savings,
and tax situation trumps almost
everything.
I
have an enormous refinanced mortgage
that will not be paid off until I'm
nearly 100 years of age. My strategy is
to carry a jumbo mortgage for tax
purposes and invest in an insured
tax-exempt fund where the after-tax
returns of my annual tax-exempt cash
flow exceed the after-tax cash outflow
of my mortgage costs. Of course this is
not a good strategy for everyone because
there are risks in tax-exempt fund
values, and tax-exempt bonds are not
good inflation hedges. Old guys like me
don't worry so much about inflation.
Young investors should worry about
inflation.
What I'm saying is that your outlook on
investments and life change with the
seasons of your life. When I was young I
always purchased the highest price home
with the biggest mortgage that I could
possibly afford. When on the faculty at
the University of Maine in the 1970s
I had a big and beautiful house in town
plus a cottage on 12 acres of ocean
front. In those days real estate values
just kept going up and up and up.
Two things have changed in my life. One
is that I'm no longer young with worries
about inflation and home real estate
values. My children will inherit enough
to a point that I'm not worried about
inflation or the value of my home over
the next 20 years --- Ka Sara Sara!
The other thing that has changed in my
lifetime is the real estate market. Up
in the mountains where I now live
expensive property is just not selling.
The market is also limited for other
types of property since northern New
England is in an economic and population
growth slump. Also the market for second
(vacation) homes is changing --- in part
due to higher risk of losing money on
these investments. I sold an Iowa farm a
few years ago. This is a totally
different type of investment where
values have been rising in large measure
because of the corn ethanol disaster for
consumers. Today, however, I think Iowa
farm land is a better investment for
farmers who actually drive the tractors
on Iowa farm land relative to far away
landlords with no intent to farm the
land themselves. Having said that, farm
land is a pretty good long-term
inflation hedge for investors not
needing much interim cash flow. At the
moment Iowa farm land may be too high
priced. Who really knows? Nobody!
My
point is that both your economic and
personal situation changes with seasons
of life and states of the economy and
tax reforms that might finally get
enacted. Advice is cheap and possibly
misleading. It's best to study your
particular situation to a point where
you can advise yourself.
Bob Jensen's personal finance
helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Individual Retirement Account (IRA) ---
http://en.wikipedia.org/wiki/Individual_retirement_account
There are several types of IRA:
-
Traditional IRA –
contributions are often
tax-deductible (often simplified
as “money is deposited before
tax” or “contributions are made
with pre-tax assets”), all
transactions and earnings within
the IRA have no tax impact, and
withdrawals at retirement are
taxed as income (except for
those portions of the withdrawal
corresponding to contributions
that were not deducted).
Depending upon the nature of the
contribution, a traditional IRA
may be referred to as a
“deductible IRA” or a
“non-deductible IRA.” It was
introduced with the Tax Reform
Act (TRA) of 1986.
-
Roth IRA –
contributions are made with
after-tax assets, all
transactions within the IRA have
no tax impact, and withdrawals
are usually tax-free. Named for
Senator
William V. Roth, Jr..
The Roth
IRA was introduced as part of
the Taxpayer Relief Act of 1997.
-
SEP IRA –
a
provision that allows an
employer (typically a small
business or self-employed
individual) to make retirement
plan contributions into a
Traditional IRA established in
the employee’s name, instead of
to a pension fund in the
company's name.
-
SIMPLE IRA –
a Savings Incentive Match Plan
for Employees that requires
employer matching contributions
to the plan whenever an employee
makes a contribution. The plan
is similar to a
401(k)
plan, but with lower
contribution limits and simpler
(and thus less costly)
administration. Although it is
termed an IRA, it is treated
separately.
-
Self-Directed IRA –
a
self-directed IRA that permits
the account holder to make
investments on behalf of the
retirement plan.
There are two other subtypes of IRA,
named Rollover IRA and Conduit IRA,
that are viewed by some as obsolete
under current tax law (their
functions have been subsumed by the
Traditional IRA); but this tax law
is set to expire unless extended.
However, some individuals still
maintain these arrangements in order
to keep track of the source of these
assets. One key reason is that some
qualified plans will accept
rollovers from IRAs only if they are
conduit/rollover IRAs.
What was
formerly known as an Educational IRA
is now called a
Coverdell Education Savings Account.
Starting with
the
Economic Growth and Tax Relief
Reconciliation Act of 2001
(EGTRRA), many of the restrictions
of what type of funds could be
rolled into an IRA and what type of
plans IRA funds could be rolled into
were significantly relaxed.
Additional acts have further relaxed
similar restrictions. Essentially,
most retirement plans can be rolled
into an IRA after meeting certain
criteria, and most retirement plans
can accept funds from an IRA. An
example of an exception is a
non-governmental
457 plan
which cannot be rolled into anything
but another non-governmental 457
plan.
The tax treatment of the above types
of IRAs except for Roth IRAs are
substantially similar, particularly
for rules regarding distributions.
SEP IRAs and SIMPLE IRAs also have
additional rules similar to those
for qualified plans governing how
contributions can and must be made
and what employees are qualified to
participate.
"Should
You Contribute to a Non-Deductible IRA?"
by Laura Adams, Money Girl,
February 12, 2013 ---
http://moneygirl.quickanddirtytips.com/what-is-a-non-deductible-ira.aspx
Bob Jensen's personal finance helpers
---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
"Do
Gold ETFs Really Move on Inflation
Expectations?" by John Spence,
ETF Trends, Junw 15, 2012 ---
http://www.etftrends.com/2012/06/do-gold-etfs-really-move-on-inflation-expectations/
Thank you Jim Mahar for the heads up.
Gold ETFs are often described as an
inflation hedge but recent academic
research suggests the precious metal
is more dependent on emerging market
demand, particularly from central
banks that hold less gold than their
counterparts in developed countries.
“Assuming that
gold moved in lockstep with the CPI,
the implied price would be about
$780 an ounce, according to Duke
University Professor Campbell R.
Harvey and his collaborator, Claude
B. Erb,”
Bloomberg News
reports.
Gold is
trading back above $1,600 an ounce
as traders speculate on the odds of
further monetary easing before next
week’s Federal Reserve meeting.
[Gold ETFs Eye Fed, Europe]
Since the gold bull market started
in about 2001, prices have risen
more than sevenfold.
“If gold is an inflation hedge, then
on average its real return should be
zero,” Erb and Harvey wrote,
according to the Bloomberg report.
Instead, returns from 2000 through
March of this year averaged 13% a
year on an inflation-adjusted basis.
Gold ETFs such
as
SPDR Gold
Shares (NYSEArca:
GLD),
iShares Gold Trust (NYSEArca:
IAU)
and
ETFS Physical Swiss Gold Shares (NYSEArca:
SGOL)
have likely fueled the metal’s rise
since they have made it easier for
more investors to buy gold.
“Global ETF
investor positions have continued to
trend up in both gold and silver,
reflecting the fact that long term
price supports such as negative real
interest rates, currency debasement
and sovereign/financial sector
default risk, and rising emerging
market/central bank demand remain
embedded in the 2012 outlook,” ETF
Securities said in a report earlier
this year.
[Measuring the Impact of Gold ETFs]
Harvey and Erb wrote that emerging
markets can support gold because the
precious metal represents a smaller
part of central bank reserves than
developed nations.
Foreign
central banks are “one of the more
intriguing sources of incremental
demand for gold,” says ConvergEx
Group strategist Nicholas Colas.
[Strategist: Why Gold ETFs Still
Make Sense]
“Among emerging economies, for
example, central banks are actively
buying gold to add to their
reserves. The trend is most
noticeable in Russia and India, but
increasingly in China as well. Press
accounts placed China’s net gold
purchases in 2011 at over 200 tons,
doubling its position in one year,”
he said in a recent report.
“And gold is clearly playing a role
at the central bank level in these
countries’ efforts to hedge such
price increases,” Colas noted.
“There is a popular saying on Wall
Street – ‘Don’t fight the Fed.’ Why
fight the Chinese, Russian and
Indian central banks on gold? Like
the Fed, they have much deeper
pockets than you.”
See Chart
Continued in article
Planning for the Bad as Well as the Good
in Retirement
"CPAs
Stress the Importance of Long-Term Care,"
AICPA, August 2012 ---
http://blog.aicpa.org/2012/08/cpas-stress-the-importance-of-long-term-care.html
Jensen Comment
Note that Medicare does not pay for
long-term care even though it does pay
for short-term crisis moments that
qualify for admission to a hospital. The
largest single Medicare expenditure by
far is for the hospital costs of dying,
but between the stroke and dying
hospital periods that are covered by
Medicare can be months and even years of
long-term care not covered.
I
learned at the 2012 AAA Annual Meetings
that a really close former friend and
colleague has been paying out over
$150,000 per year for 24/7 home nursing
care for a number of years. Because this
former accounting professor can afford
such level of care, it's not been
necessary to be admitted into a lower
costing nursing care facility. But such
nursing care facilities are still very
expensive for very long-term care.
A
friend committed suicide about three
years ago in Manchester, New Hampshire.
We were close years ago when we were
both masters degree students at the
University of Denver. Interestingly, he
had an expensive paid-up insurance
policy for long-term nursing care.
Sherman never married and had no family
left whatsoever. My guess is that when
his health and quality of life started
going downhill he just did not want to
waste away in a nursing home even though
he had premium insurance coverage for
long-term care.
By the way I am not advising for or
against long-term care insurance.
Such insurance is quite expensive and
increases greatly in cost with age. I
did not conduct research for this email
message, but I think that the odds are
still relatively low for incurring very
expensive long-term care. But "odds" are
computed on the basis of a large
population of elderly people. The odds
for a given individual can be quite
different. The mother-in-law of one of
my cousins back in Iowa has been in a
nursing home for over ten years in a
small Iowa town. In no way could she
have paid for such care all these years
without having had such insurance.
Hence, I do not give advice regarding
whether to buy or not buy long-term care
insurance. I did not buy such insurance.
Keep in mind that most long-term care
insurance policies do not cover all
long-term care costs. Some policies only
pay a pittance of these costs.
My
point that all retirees are subject to
the financial risks of long-term care.
These should be factored into dreams of
that condo on a golf course or that
small hobby farm with occasional luxury
cruises.
No
Fooling: Try This One Out With Students
(adding sensitivity analysis with
interest rates and inflation)
"Slow Compounding," by Floyd
Norris, The New York Times, April
1, 2011 ---
http://norris.blogs.nytimes.com/2011/04/01/slow-compounding/
American Express has a full-page ad
in today’s Times offering a savings
account yielding 1.15 percent.
These days that is a good rate, a
fact the people of my generation
find astonishing. Such amazingly low
rates cause great anxiety for those
who saved money in the past and now
find it yields so little.
I did a little arithmetic. My son is
an 18-year-old college freshman. If
he puts $100 into such an account
now, and rates remain constant, he
will have doubled his money in time
for his 79th birthday party.
Of course, if you are investing for
a child in kindergarten, there is
still hope. A $100 investment today
would double about the time he or
she goes on Medicare.
Bob Jensen's personal finance helpers
are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
The sad part about going into business
apart from writing books is that having
such a huge vested interest in that
business creates moral hazard in terms
of independence as on of the leading
personal finance commentators in the
world. The champion of the poor and
troubled may be trying to increase her
1% at the expense of the poor and
troubled.
Suze Orman ---
http://en.wikipedia.org/wiki/Suze_Orman
"Suze
Orman, Debit-Card Dealer: The
money guru introduces her first
financial product—and vexes some fans,"
by Karen Weise, Bloomberg Business Week,
January 19, 2012 ---
http://www.businessweek.com/magazine/suze-orman-debitcard-dealer-01182012.html
“I love you!” a woman yells as
personal finance guru Suze Orman
enters the drab conference room at a
Barnes & Noble (BKS) in suburban New
Jersey. Fans cheer and clap while a
man in the front row tears up from
excitement. Orman is here to preach
the tough-love brand of financial
advice that she’s been peddling for
more than a decade through nine
bestselling books, a highly rated
CNBC show, and regular appearances
on the old Oprah Winfrey Show. “You
have got to be the masters of your
own financial future,” she tells the
200-strong crowd. While the event
coincides with a new paperback
edition of her 10th book, The Money
Class, that’s not the main focus of
her talk. “You need more than
books,” she says. “Now you need the
tools.”
Orman has a particular tool in mind.
Just a few days earlier she
introduced her first financial
product: a prepaid debit card
emblazoned with her name. She sees
her Approved Card as an alternative
way for people who are fed up
with—or don’t have—traditional
checking accounts and credit cards
to manage their cash. And if the
most ambitious part of her plan
succeeds, the card may eventually
help users improve their credit
scores.
Orman’s Approved Card, issued by
Wilmington (Del.)-based Bancorp Bank
(TBBK), is in part designed to play
the role of pestering mom. The
basics are simple: People use
electronic transfers or cash to load
money onto their cards, then use
them like regular debit cards,
buying groceries or shopping online.
The Orman touch comes in such
features as automatic text message
alerts sent to mobile phones that
note the balance remaining on the
card after each purchase. The card’s
website has Orman issuing such
sharply worded reminders as, “Before
you make a purchase, you’d better be
able to afford it—do you hear me?!”
Prepaid cards are the
fastest-growing payment method,
Federal Reserve data show. In 2010
people used them for $65 billion in
transactions, compared with $48
billion in 2009, the industry
newsletter Nilson Report says. Part
of the cards’ appeal is that you
can’t get into debt with them. “I
think it’s a good idea to have a
prepaid card rather than going out
willy-nilly with a credit card,”
says Glinda Kidd at the book
signing.
Still, prepaid cards often come
loaded with fees—and Orman’s is no
exception. It has a standard $3
monthly charge. While there’s no
cost to reload the card with direct
deposits or automatic transfers from
a checking account, people must pay
up to $4.95 to put cash on the card
at Western Union (WU) or MoneyGram
(MGI) locations. And if they load
with cash rather than
electronically, all ATM withdrawals
cost $2. One free call to a customer
service rep is included each month;
extra calls are $2 each.
“What people don’t understand is the
cost to do business,” says Orman in
an interview. “If I could have given
this to you for free, I would have.”
Orman, who says she invested $1
million in the venture, declines to
discuss how much money she might
make from it. And she vows to train
customers to keep their costs down.
In videos on the card’s website, she
explains the fees, warning that
people who load their cards
electronically can get cash from one
of the 35,000 ATMs in the Allpoint
network for free but will incur a $2
charge for using other ATMs—plus
whatever fee the ATM operator
imposes. “Why would you want to
waste money like that?” she says in
the video. “Don’t be lazy, and go to
an Allpoint ATM.”
Orman says if she finds people are
incurring fees to put cash on the
card, only to spend another $2 to
get cash at an ATM, she will ask
them to turn in their plastic. If
you’re going to squander money that
way, “just keep it in cash! You
don’t need the damn card,” she tells
the audience at the book signing.
Michael Collins, an assistant
professor at the University of
Wisconsin who studies the financial
decision-making of low-income
families, says people will
eventually figure out the costs of
any product. “The question is how
long will it take” and how much in
fees they will have racked up by
then, he says. Collins adds that if
Orman’s messages help people control
their spending impulses, the card
could be beneficial: “Anything that
gets people to think harder about
their financial security and take
some responsibility is a good
thing.”
Some personal finance bloggers have
complained about the fees and
charged that Orman is using her
influence to bilk her fans. On
Twitter, the Blog Finanza website
said: “You are taking your authority
figure to make a $$ from your
audience. #DENIED”—echoing a
catchphrase from Orman’s TV show.
Others, such as MSNBC.com consumer
finance columnist Herb Weisbaum,
said many people would be better
served by building their credit
immediately with a secured credit
card.
Orman dismisses the criticisms,
saying the card reflects her
understanding of people’s financial
habits and needs. “I am the personal
financial expert of the world,” she
says. “I know what I am talking
about.” Publicly, Orman lashed out
on Twitter against the naysayers,
calling them “small thinkers,”
“idiots,” and “Suze haters.” After
New York Times personal finance
columnist Ron Lieber and others
protested the harsh words, she
issued a blanket apology: “For
anyone I called an idiot, I too am
sorry.”
Continued in article
"Does Suze Orman's
Prepaid Debit Card Make Sense for You?"
by Sarah Gilbert, Get Rich Slowly,
January 17, 2012 ---
http://www.getrichslowly.org/blog/2012/01/17/does-suze-ormans-prepaid-debit-card-make-sense-for-you/?WT.qs_osrc=fxb-48064510
Suze Orman
is famous for her personal,
easy-to-digest, and friendly
personal finance advice. Many of us
less famous (far less
famous, in the case of this writer)
finance writers admire her general
approach, which boils down to “spend
less than you earn.” Who can argue
with that? So imagine my amazement
at the news this week that Suze will
be
offering a branded prepaid debit
card.
Prepaid debit cards have a
star-crossed reputation
You know about branded prepaid debit
cards, but they're usually not
connected with individuals known for
their sensible finance advice. Think
Russell Simmons.
Think
the Kardashians.
See? Sample
words and phrases from our
collective wisdom on those topics
include “skeptical” and
“reprehensible” and “urge to scream”
and “hit cash-strapped consumers
over the head with nickel-and-dime
charges.”
Suze Orman is famous for her
personal, easy-to-digest, and
friendly personal finance advice.
Many of us less famous (far less
famous, in the case of this writer)
finance writers admire her general
approach, which boils down to “spend
less than you earn.” Who can argue
with that? So imagine my amazement
at the news this week that Suze will
be offering a branded prepaid debit
card.
Prepaid debit cards have a
star-crossed reputation You know
about branded prepaid debit cards,
but they're usually not connected
with individuals known for their
sensible finance advice. Think
Russell Simmons. Think the
Kardashians. See? Sample words and
phrases from our collective wisdom
on those topics include “skeptical”
and “reprehensible” and “urge to
scream” and “hit cash-strapped
consumers over the head with
nickel-and-dime charges.”
The biggest problems with prepaid
debit cards are, really, threefold:
While they are cards that are
available to consumers with bad
credit, they don't help consumers
build credit, though they are
advertised as doing so (any help
would be mild at best - the
reporting they do is only to smaller
credit reporting agencies, not the
“big three” that man the velvet rope
for most consumer debt in America).
They're punishingly expensive and
seem more directed toward
association with the personality
branding the card than any financial
benefit. Russell's “Rush” Card costs
between $4 and $15 upfront, with $10
monthly fees and $1 per-transaction
fees. They're accused of using
celebrities to take advantage of
both the hopes and difficult
situations of the “unbanked,”
mostly-lower-class, often minority
consumers whose financial situation
is so bad that banks won't take the
risk of giving them checking
accounts.
Suze Orman wants to make a
difference (but, is it a fool's
errand?) Orman has a different idea.
She, too, wants to convince the
unbanked to use her prepaid debit
card, but she wants to charge less.
Her “Approved Card” is far cheaper
than Rush or the K thingy - only $3
to purchase the card and a $3
monthly fee. ATM transactions from
the Allpoint network (found in
7-Eleven, Costco, Kroger, CVS, and
Walgreens) are $2 per withdrawal,
and point of sale transactions, such
as purchases at the grocery store or
coffee shop or online, are free.
Balance inquiries and some declined
transactions are $1 , but it's free
to be declined at the register for a
regular PIN/signature transaction.
Many of these transactions,
especially ATM withdrawals, are free
for 30 days with a direct deposit or
bank transfer into the Approved Card
account, making them a great product
for customers with some sort of
automatically-deposited income
(even, for instance, unemployment).
Notably, electronic debit bill
paying is free. Many competing
products charge for this service,
from $1 to $3 per transaction, and
it's the service that customers
without a regular bank account need.
Often, discounts and special deals
are available to customers who allow
vendors to debit their account each
month.
The great credit score kerfuffle
The concept that sells many prepaid
debit cards - the
quasi-justification for how
expensive they are - is that they
might help in the quest to raise a
credit score. If a credit score is
low enough so that a mainstream bank
isn't part of your personal finance
portfolio, can a prepaid debit card
even help? Probably not.
The problem that Suze Orman has
mentioned in public statements about
the Approved Card is that credit
bureaus, beyond even knowing about
the transactions made by the
millions of unbanked consumers,
don't care about sensible use of
money. They just care about sensible
use of credit. A New York Times
piece quotes Orman as saying, “There
is something radically wrong here.
We are rewarding people for having
credit and punishing people who pay
in cash. I want to change that
paradigm.”
Wanting to change credit score
calculation is easy. Changing is
hard.
Orman has done the near-impossible
and convinced TransUnion, one of the
big three credit bureaus, to collect
the data about spending habits from
her customers. But what that will do
to credit scores is another thing
entirely. The answer, probably, is
nothing.
The problem
that Suze Orman has mentioned in
public statements about the Approved
Card is that credit bureaus, beyond
even knowing about the transactions
made by the millions of unbanked
consumers, don't care about sensible
use of money. They just care about
sensible use of credit. A
New York Times piece
quotes Orman
as saying, “There is something
radically wrong here. We are
rewarding people for having credit
and punishing people who pay in
cash. I want to change that
paradigm.”
Wanting to change credit score
calculation is easy. Changing is
hard.
Orman has done the near-impossible
and convinced TransUnion, one of the
big three credit bureaus, to collect
the data about spending habits from
her customers. But what that will do
to
credit scores is
another thing entirely. The answer,
probably, is nothing.
The problem is
that TransUnion has only been
persuaded to evaluate the data Orman
will collect with her Approved Card;
it has not promised to include that
in credit reports nor in the
calculation of scores. If, after two
years, it finds the data meaningful,
it's still unlikely to have much of
an effect on the resultant
calculations. Responsible use of a
prepaid debit card, after all,
hasn't had much impact on the
financial institutions that sponsor
the card - in this case, Orman's own
company - so the patterns of data
don't have much meaning.
What kind of debit card use could
demonstrate the sort of behavior
creditors want to see, such as:
-
On-time
delivery of minimum
payments
-
A history of purchasing
high-value assets and then
paying them off quickly
-
Regular income and a comfortable
ratio of debt-to-income
These all can be shown far more
reliably through existing reporting.
A consumer who pays rent on time
each month in cash won't differ, to
the eyes of TransUnion, from a
consumer who pays rent on time each
month by automatic debit from her
Approved Card. Similarly, failing to
overdraw an Approved Card account
(that is impossible to overdraw
from, except perhaps for a few $1/$2
ATM transaction declined fees) is
very different from failing to
overdraw a bank account.
Why
would you use a prepaid debit card?
There are two groups of people I can
see benefiting from using a prepaid
debit card, as well as one group I
would caution to avoid it. All of
them could achieve higher credit
scores, but not in the way you
think. Let me explain.
Continued in article
Jensen Comment
The sad part about going into business
apart from writing books is that having
such a huge vested interest in that
business creates moral hazard in terms
of independence as on of the leading
personal finance commentators in the
world. The champion of the poor and
troubled may be trying to increase her
1% at the expense of the poor and
troubled.
Bob Jensen's personal finance helpers
are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Financial Education in the Math Classroom ---
http://mathforum.org/fe/
A Government Website for Helpers
in Personal Finance MyMoney.gov is the U.S. government's
website dedicated to teaching all Americans the basics about
financial education. Whether you are planning to buy a home,
balancing your checkbook, or investing in your 401k, the resources
on MyMoney.gov can help you do it better. Throughout the site, you
will find important information from 20 federal agencies government
wide. My Money.gov ---
http://www.mymoney.gov/
PBS Television will now answer your personal finance questions
---
http://www.pbs.org/newshour/insider/business/jan-june09/pocketchange_05-05.html
From CNN: Clark Howard's Informative Advice About Shopping,
Financial Planning, and Warnings About Scams ---
http://www.cnn.com/CNN/Programs/clark.howard/?iref=allsearch
Bob Jensen's warnings about scams
---
http://faculty.trinity.edu/rjensen/FraudReporting.htm
Bob Jensen's shopping helpers ---
http://faculty.trinity.edu/rjensen/Bookbob3.htm
National Endowment for Financial
Education ---
http://www.nefe.org/
Mission
The mission of the National
Endowment for Financial Education is
to help individual Americans acquire
the knowledge and skills necessary
to take control of their financial
destiny. NEFE’s mission is grounded
in the belief that regardless of
background or income level,
financially informed individuals are
better able to:
-
Take control of their
circumstances,
-
Improve their quality of life,
and
-
Ensure a stable future for
themselves and their families.
Guiding Principles
NEFE’s guiding
principles are stated in eight
initiatives.
These
initiatives:
-
Describe how NEFE achieves its
mission, and
-
Outline the goals and standards
that guide the foundation’s
activities.
Every project
or program undertaken by NEFE must
fit within the scope of at least one
initiative.
NEFE accomplishes its mission
primarily by
partnering with
other organizations to:
-
Provide practical, reliable, and
unbiased financial education to
members of the public.
-
Accomplish research in the field
of financial literacy
education.
-
Create demand for financial
education.
NEFE’s activities place special
emphasis on those who face financial
challenges that are not being
addressed by others. Among our
target audiences are:
-
Youth,
-
Low-income individuals and
families, and
-
People in difficult or unusual
life circumstances.
NEFE’s partnerships and the
foundation’s own efforts result in a
wide range of free and low-cost
activities and materials,
including:
New activities
are covered in each issue of the
foundation’s newsletter,
NEFE Digest, and in the
New at NEFE section.
Organizational Structure
The National
Endowment for Financial Education is
a nonprofit 501(c)(3) foundation
governed by a volunteer
Board of Trustees
and led by
president and CEO
Ted Beck.
A staff of fewer than 25 individuals
guides NEFE’s public-service work at
its headquarters in Denver,
Colorado. To learn more, visit the
History section
of this Web
site.
NEFE organizes
its activities into four
action areas, which flow
from the foundation’s mission and
initiatives.
NEFE defines its action areas as:
-
Education Programs.
Although not restricted to a
particular age group, the
Education Programs area has been
oriented primarily to providing
financial planning information
to youth, including NEFE’s
longest-standing public service
effort, the
NEFE High School Financial
Planning Program® (HSFPP).
-
Strategic
Programs and Alliances. This
action area works to help
Americans improve the quality of
their lives through financial
education provided in
cooperation
with other nonprofit
organizations and foundations,
and occasional corporate
sponsors.
-
Multimedia Access. This
action area represents NEFE’s
commitment to sharing its
expertise in financial planning
education with all those who
might benefit from it, including
consumers,
educators,
and the
media.
-
Innovative Thinking.
The goal of this action area is
to inspire creative ideas and
new perspectives on personal
finance, to communicate them
broadly, and to assist in their
actualization where appropriate.
This action area supports
fellowships
programs,
grantmaking,
and
research and strategic
activities.
Video:
Interesting look at 8 common investment
mistakes that uses Big Brown (the horse,
not the delivery company). ---
http://financeprofessorblog.blogspot.com/2009/10/video-on-common-mistakes.html
Last
night's (October 7, 2009) PBS NewsHour
took a look at the bearish obsession du
jour, the commercial real estate market.
Real estate analyst Bob White took them
around to show some of the ugliest cases
out there. (via
Square Feet)
http://www.businessinsider.com/a-guided-tour-of-nyc-commercial-real-estate-wreckage-video-2009-10
TIAA-CREF has done a good job weathering
the latest economic recession
"TIAA-CREF and You," Chronicle
of Higher Education, October 4, 2011
---
http://chronicle.com/article/TIAA-CREFYou/129261/?sid=at&utm_source=at&utm_medium=en
. . .
To understand TIAA-CREF's offerings,
first understand what it is:
Whatever the prominence of the words
Teachers and College in its unpacked
acronym, TIAA-CREF is simply a giant
insurance company. Pennywise wrote
about TIAA-CREF once before, in a
column that appeared at the height
of the financial crisis entitled,
"Is TIAA-CREF Safe?" Personally, I
find that article has held up fairly
well and may be reassuring today, in
our renewed mood of uncertainty. New
readers might want to take a look at
it.
TIAA-CREF has weathered the Great
Recession well. Today the company
ranks 87th on the Fortune 500 list,
with $32-billion in revenues and
$1.4-billion in annual profits. All
four ratings agencies still give the
company the highest possible rating
for financial stability; at this
point, its ratings are better than
the federal government's. A leading
investing Web site calls the company
the strongest annuity insurer in the
United States.
As for your specific TIAA-CREF
investing options, your university's
human-resources department can
choose from a smorgasbord, so plans
will differ. Almost certainly your
college's plan has annuities at its
core. Those are, for the most part,
variable annuities, meaning their
value and rates of return fluctuate
along with financial markets,
functioning much like mutual funds
in the accumulation phase—the
stretch of life in which you amass
your holdings. Once you reach the
drawdown phase, however, those
vehicles offer the ability either to
take out your pile of money in a
lump sum or to annuitize it, meaning
convert it into a steady stream of
annual (hence the name "annuity")
income that will last the rest of
your life.
You may notice annuities getting bad
press from time to time because the
ones sold by many insurers come
wrapped in a lot of hidden fees and
are sold by advisers seeking
commissions. TIAA-CREF's annuities
are in a different category; they
are relatively low-cost, the
company's consultants get no
commissions, and the criticisms
don't really apply (one exception
noted at the end of this column).
Here's how not to invest
with TIAA-CREF: Don't—after looking
at the 10-year returns of the
different options—put your money
heavily into the ones that have
performed best. Ten years from now
something else may have outperformed
them. The funds that have done well
recently are probably the most
expensive right now, but nobody can
be sure.
Instead, consider your household
portfolio as a whole. Seek a
well-diversified mix of different
types of investments that rely on
returns from different sectors of
the economy. Understand how each
option functions and spread your
money around in proportions that
make sense for your relative sense
of risk.
Your plan is likely to include the
following:
TIAA Traditional Annuity.
From your point of view, this
account works a bit like a bank
certificate of deposit with a very
generous interest rate. TIAA-CREF
guarantees that any money you put in
will be returned. The company then
pays a specific rate of interest
(currently 3.75 percent) on all new
money deposited, a rate adjusted
periodically. (The overall rate of
return for the past 10 years was
5.62 percent). Because TIAA-CREF
manages the underlying pool of money
by investing mostly in bonds and
related securities, rates in the
coming years will probably be fairly
low, but your contributions are
contractually guaranteed.
This is an excellent investment for
those who react very badly to market
drops. However, while you do not
face market risk, you do face
individual company risk. If
TIAA-CREF went bankrupt, its
guarantee would mean nothing. That's
why the firm's profitability and
stability are crucial.
Note: To guarantee your principal
plus a rate of interest, TIAA-CREF
puts some fairly strong restrictions
on clients' ability to transfer
money in and out of this annuity.
Don't commit money to TIAA
Traditional unless you are content
to let it sit until you retire. You
can get it out, but it will be
difficult.
Tip: Concentrate your TIAA
Traditional holdings in your main
403(b) account, since a much lower
rate of interest (currently 0.75
percent less) will be paid on it in
your Supplemental Retirement Account
(SRA), if you have one.
TIAA Real Estate Variable
Annuity. The funds in this
distinctive offering are invested
directly in real estate (office
buildings, malls, industrial parks,
and so forth). Buy in, and you get
the perks of being a property mogul
and landlord, without all the
hassles.
CREF Variable Annuities.
These function a great deal like
regular mutual funds. There are five
stock-market options: Global, Stock,
Equity Index, Growth, and Social
Choice. Global and Stock both invest
in world stock markets, including
U.S. and international ones. Equity
Index and Growth are solely U.S.
stock-market funds. Social Choice
screens for certain ethical and
political criteria. Then there are
three options that apply to the more
stable, less risky part of your
portfolio: Bond, Inflation-Linked
Bond, and Money Market.
It may be that your university plan
also offers, beyond the above
annuities, TIAA-CREF's vast array of
mutual funds, which come in almost
infinite variations, including
LifeCycle funds (all-in-one,
no-brainer options for those who
want to put things on autopilot) or
highly specific funds focusing on
specific sectors of the stock
market, such as small-cap companies.
The precise
mix that is right for you depends on
your risk tolerance and time frame.
There are decent models on Page 12
of this
brochure.
No need to make it complex, though.
A pretty good holding could be
amassed in just TIAA Traditional (20
percent); TIAA Real Estate (10
percent); one of the stock-market
annuities, perhaps Equity Index
since it costs you the least, or
Global since it has international
diversification to offer (60
percent); and the inflation-adjusted
bond option (10 percent). Reduce the
equities portion and increase the
bond if you are skittish or near
retirement.
Remember that the current market
mayhem may mean you will be buying
low. Don't let it scare you away
from stocks, even if, in the short
term, you see some declines.
Continued in article
Making Home Affordable ---
http://www.makinghomeaffordable.gov/pages/default.aspx
Making Home Affordable is a key part
of the Obama Administration's effort
to help homeowners avoid
foreclosure. If you are struggling
with your monthly mortgage payments
or have already missed a payment,
now is the time to take action.
Start today by learning more about
the options available to you through
MHA
Help for Homeowners Facing
Foreclosure
Help for Homeowners Struggling
With Mortgage Payments
Help for Homeowners Trying to
Avoid Mortgage Troubles
Attend an MHA event in
your area
Ray Williams ---
http://en.wikipedia.org/wiki/Ray_Williams_(basketball)
"Nobody wnats you when you're down and
out" ---
http://www.youtube.com/watch?v=MsrA2fMn0sk&feature=fvst
A Sad, Sad Case That Might Be Used
When Teaching Personal Finance:
Another Joe Lewis Example
"Desperate times: Ex-Celtic
Williams, once a top scorer, is now
looking for an assist," by Bob Hohler,
Boston Globe, July 2, 2010 ---
http://www.boston.com/sports/basketball/celtics/articles/2010/07/02/desperate_times/
Every night at bedtime, former
Celtic Ray Williams locks the doors
of his home: a broken-down 1992
Buick, rusting on a back street
where he ran out of everything.
The 10-year NBA veteran formerly
known as “Sugar Ray’’ leans back in
the driver’s seat, drapes his legs
over the center console, and rests
his head on a pillow of tattered
towels. He tunes his boom box to
gospel music, closes his eyes, and
wonders.
Williams, a generation removed from
staying in first-class hotels with
Larry Bird and Co. in their drive to
the 1985 NBA Finals, mostly wonders
how much more he can bear. He is not
new to poverty, illness,
homelessness. Or quiet desperation.
In recent weeks, he has lived on
bread and water.
“They say God won’t give you more
than you can handle,’’ Williams said
in his roadside sedan. “But this is
wearing me out.’’
A former top-10 NBA draft pick who
once scored 52 points in a game,
Williams is a face of big-time
basketball’s underclass. As the NBA
employs players whose average annual
salaries top $5 million, Williams is
among scores of retired players for
whom the good life vanished not long
after the final whistle.
Dozens of NBA retirees, including
Williams and his brother, Gus, a
two-time All-Star, have sought
bankruptcy protection.
“Ray is like many players who
invested so much of their lives in
basketball,’’ said Mike Glenn, who
played 10 years in the NBA,
including three with Williams and
the New York Knicks. “When the
dividends stopped coming, the
problems started escalating. It’s a
cold reality.’’
Williams, 55 and diabetic, wants the
titans of today’s NBA to help take
care of him and other retirees who
have plenty of time to watch games
but no televisions to do so. He
needs food, shelter, cash for car
repairs, and a job, and he believes
the multibillion-dollar league and
its players should treat him as if
he were a teammate in distress.
One thing Williams especially wants
them to know: Unlike many troubled
ex-players, he has never fallen prey
to drugs, alcohol, or gambling.
“When I played the game, they always
talked about loyalty to the team,’’
Williams said. “Well, where’s the
loyalty and compassion for
ex-players who are hurting? We
opened the door for these guys whose
salaries are through the roof.’’
Unfortunately for Williams, the
NBA-related organizations best
suited to help him have closed their
checkbooks to him. The NBA Legends
Foundation, which awarded him grants
totaling more than $10,000 in 1996
and 2004, denied his recent request
for help. So did the NBA Retired
Players Association, which in the
past year gave him two grants
totaling $2,000.
Continued in article
"A Home Is a Lousy Investment: Today's young people would be foolish
to imitate their parents and view ownership as the cornerstone of personal
finance," by Robert Bridges, The Wall Street Journal, July 11, 2011
---
http://online.wsj.com/article/SB10001424052702304259304576375323652341888.html?mod=djemEditorialPage_t
At the risk of heaping more misery on the
struggling residential property market, an analysis of home-price and
ownership data for the last 30 years in California—the Golden State with
notoriously golden property prices—indicates that the average single family
house has never been a particularly stellar investment.
In a society increasingly concerned with providing
for retirement security and housing affordability, this finding has large
implications. It means that we have put excessive emphasis on owner-occupied
housing for social objectives, mistakenly relied on homebuilding for
economic stimulus, and fostered misconceptions about homeownership and
financial independence. We've diverted capital from more productive
investments and misallocated scarce public resources.
Between 1980 and 2010, the value of a median-price,
single-family house in California rose by an average of 3.6% per year—to
$296,820 from $99,550, according to data from the California Association of
Realtors, Freddie Mac and the U.S. Census. Even if that house was sold at
the most recent market peak in 2007, the average annual price growth was
just 6.61%.
So a dollar used to purchase a median-price,
single-family California home in 1980 would have grown to $5.63 in 2007, and
to $2.98 in 2010. The same dollar invested in the Dow Jones Industrial Index
would have been worth $14.41 in 2007, and $11.49 in 2010.
Insert Graph
Here's another way of looking at the situation. If
a disciplined investor who might have considered purchasing that
median-price house in 1980 had opted instead to invest the 20% down payment
of $19,910 and the normal homeownership expenses (above the cost of renting)
over the years in the Dow Jones Industrial Index, the value of his portfolio
in 2010 would have been $1,800,016. The stocks would have been worth more
than the house by $1,503,196. If the analysis is based on 2007, the stock
portfolio would have been worth $2,186,120, exceeding the house value by
$1,625,850.
In light of this lackluster investment performance,
and in the aftermath of the recent housing-market collapse, why is there
such rapt attention to the revival of the homebuilding industry and
residential property markets? The answer is that for policy makers whose
survival depends on economic recovery, few activities have such direct,
intense and immediate positive economic impact as new home construction.
Continued in article
Jensen Comment
There's a huge difference between owning rental property versus owning a
residence for yourself, although dealing with tenants is sometimes a real pain
in the tail. If you're handy with repairing rental property located in an area
where there's huge demand (such as near a college campus or medical center), the
returns can be quite high for property purchased when the real estate market is
on the down side and mortgage rates were low --- such as in 2011. There are also
added tax breaks such as deductions for repairs, insurance, and depreciation.
But on your personal residence the capital gains are no longer as attractive as
they were in the days of your ancestors. Plus Congress is debating whether to do
away with deductions for residence mortgages, although I've great faith in the
immense power of the banking and real estate lobbies.
Home ownership, until recently, was a
very good inflation hedge. The above
article tends to imply that
inflation-adjusted returns may not be so
great in the future unless you purchased
your home at a really low price in a
distressed market that shows signs of
relatively good recovery such as in
Texas versus California. Rural property
and vacation properties are not so hot
in terms of expected recovery. For
example, small towns in the farming
regions of the mid-west, like my home
state of Iowa, have dismal chances of
recovery as factory farms drive off
small farmers and the rural towns small
farmers support. My grandfather's
well-maintained five bedroom house in
Swea City, Iowa recently sold for less
than $10,000. And over half of downtown
Swea City is boarded over with plywood.
I'm amazed that more owners have not
torched buildings just to collect the
insurance.
Anticipated fuel price increases will
affect real estate values. Property
values may decline for home owners now
located 30 or more miles from where most
of the jobs are located. On the other
side of the coin, properties closer to
work centers may have increasing returns
if they are in areas of good schools.
Dangerous and/or lousy schools always
hurt the values of real estate. Another
Hurricane Andrew might wipe out real
estate prices in South Florida due, in
part, to unaffordable hurricane
insurance.
Your biggest worry as a home owner
trying to sell these days is that no
serious buyer even wants to view the
property let alone make an offer unless
you are willing to sell at a huge loss.
The minister here in our Sugar Hill
Community Church had a high-value former
home in Grand Junction, Colorado. It
took over three years to even have a
potential buyer view the property. Many
owners are finding they cannot sell at
prices above the amortized balance on
their mortgages. Owners often simply
pack up and leave the keys with their
banker, thereby wiping out all the
equity built up in the home.
Of course there are various advantages and disadvantages of home ownership other
than investment prospects. On the plus side many people like me find joy in
taking care of a home and the land that surrounds the home --- more joy than we
would find if we only rented the property.
In some cases ownership is the only alternative for a quality home on a
long-term basis. For example, Stanford University provided on-campus land for
faculty housing where, on a campus lot leased cheaply for 99 years, faculty
could build their own houses under a condition that when they rent or sell these
houses it will be to somebody in the Stanford community (faculty or staff or
visiting scholars). It's usually possible for someone new to Stanford to rent a
professor's house on this campus land. But such rentals are likely only short
term for a year or two such that somebody new to Stanford who really wants to
live on campus for the long haul really has to buy a home and not rent. When I
was invited back to Stanford for two think-tank years, I rented a geology
professor's home for one year and an economics professor's home the second year.
These homes were both only a few blocks from where Stanford accounting
professors Chuck Horngren, Bill Beaver, and Joel Demski had built their campus
homes.
A drawback to home ownership in general, however, is that it's getting harder
and harder to sell a house without taking a beating financially unless the
property is purchased at very, very distressed prices. Some banks and towns are
selling foreclosed homes very cheap. For example, a friend up here in Sugar
Hill, NH recently purchased a foreclosed home at a third of its appraised value
for property taxes. The problem is that for property taxes, the tax appraiser
subsequently refused to lower the appraisal value down to the purchase price,
i.e., the property taxes remained relatively high on this foreclosed property
after it was resold at a 'bargain basement" price.. The tax assessor stated that
Sugar Hill will not lower the property tax because of a "bargain basement"
purchase price. Hence, buyers receiving good deals on purchase prices will not
necessarily receive similar good deals when the property tax bills are received
twice a year on this good deal purchase. Tax appraisal values may be much higher
than the transacted purchase prices if the the tax appraiser deems the purchase
prices as bargain basement prices on foreclosed properties.
Home Ownership is Never "Free" Even
When You Own Your Home Free and Clear of First and Second Mortgages
Put another way, if a buyer pays more than the tax appraisal value, the tax
appraisal value will be soon be raised for property tax purposes since
all transacted real estate prices must be reported to the taxing authorities.
But if the buyer pays less than the tax appraisal value, the tax appraisal value
will not be lowered for property tax purposes unless the property owner
is successful in a costly lawsuit in Superior Court. This means that most
new owners of Sugar Hill properties are paying property taxes at much higher
appraised values than what they can realistically expect if they sell those
properties in today's depressed real estate market. I think this is a fact of
life in most other parts of the United States at the moment. And if the
courts force property tax districts to set property tax appraisals at more
realistic real estate value estimates, then the property tax districts will just
set the tax rates at levels needed to support rising local, county, and school
district budgets.
Another huge ownership drawback is that in many states like New Hampshire,
property taxes have become the primary means of local town, county, and school
financing. Hence, property taxes are markedly rising on homes even if their
value is on the decline. Of course, renters of homes are indirectly paying the
property taxes on homes. But landlord tax breaks (such as for depreciation) can
be factored in to reduce somewhat increasing property taxes. Also renters often accept less spectacular houses to
live in knowing that these houses are not investments and that they are free to
relocate in a year or less with no transactions cost and trauma of trying to
find buyers for their rental homes.
The point here is that many, many home owners are having second thoughts
about ever again purchasing homes unless the homes can be purchased at
exceedingly low bargain basement prices to justify the relatively high and
ever-increasing annual property taxes due on those properties. Or there must be
some very unique attributes that makes the property attractive to buyers such as
golf course frontage, ocean frontage, lake frontage, mountain views, or a short
walking/bicycle distance to a Stanford University faculty office.
Aside from a home plus a rural farm I inherited in Iowa, I owned three houses
(one in Michigan, one in Maine, and one in Florida) during the era where home
ownership was a great investment with values rising about 10%- 20% each year on
average. I also owned one house in Texas in a later era where I lost 15% (even
more loss if I adjust for inflation) of my
24-year investment and breathed a great sigh of relief that the only serious
prospect (after ten months) to look at this big house (4,500 square feet and my last-ever swimming
pool)) made an offer. And I sold this San Antonio house in 2006 before the real
estate bubble burst!
I suspect I will also lose a substantial amount that I
invested in my present scenic and comfortable cottage. But, since I hope to
remain here until the day I die, I don't care so much about that loss ---
http://faculty.trinity.edu/rjensen/NHcottage/NHcottage.htm
In the our case, a home is far more than a financial investment even if it is
a 150-year old money pit ---
http://en.wikipedia.org/wiki/The_Money_Pit
July 11, 2011 reply from Hossein Nouri
Bob:
I think it depends on when you start your initial
investment date. I purchased $35,000 of mutual funds (10 different
categories) in 1996 and at present its value is about $42,000 (20% increase
or 1.33% a year). I also purchased a condo in 1999 for $85000 and at present
it is $200,000 (135% increase or about 10% a year). It also provides about
$6000 positive cash flow every year or about 7% of original cost. My
retirement since 1992 also is not doing much better than my mutual fund
investment.
So, my suggestion to all young people is to buy
property, but in good location. At least you have something tangible in hand
and not a piece of worthless paper which is manipulated by all sharks in the
Wall street.
Hossein Nouri
July 11, 2011 reply from David Fordham
Bob: I'm assuming the author is announcing a change
rather than trying to correct a myth, because I would disagree with him if
he's doing the latter... up until the last four years, that is.
I would think it would be a very interesting study
to look at a possible relationship between widespread home ownership in
America (and possibly other countries) and social-class mobility of the
middle-class. Home ownership served as a major source of wealth for my
great-grandparents, grandparents, and my parents' generations, and even for
my generation. Most of my own current non-retirement net worth was generated
as roll-over gains on homes which I sold as the company transferred me
around the country during my business career.
By contrast, in Europe, I saw a major social-class
gap between the owners of rental properties, and the renters. In talking
anecdotally with friends, they seemed to hold the view that in general, rich
people own homes (country estates, townhomes, subdivision houses, city
flats, etc.), and working-class stiffs rent those properties from them. They
felt that most of the European middle-class population: (1) were renters
rather than owners, and (2) were unable to save enough to materially
increase their net worth the way Americans do by owning homes and watching
them appreciate in value, and thus (3) were unable to climb the
socio-economic ladder and deliver to their kids a better life the way most
Americans have been doing for their children.
With apologies to Jagdish, the "caste inheritance"
system whereby ones' children end up in the same socio-economic level as
their parents, was somewhat more prevalent in Europe (albeit not at the
trade/craft/occupation level as in India, but at the socio-economic level).
For example, my father greatly exceeded his
father's level, as I have exceeded my father's, and my sons are almost ready
to exceed me, while many of our friends in Europe were about where their
parents and grandparents had been: children of blue collar workers became
blue collar workers, etc.
Of course, this might be due to educational
institutions, tradition, and many other factors besides home ownership. But
since home ownership was such a wealth-builder (e.g., a GOOD investment) for
about 100 years, I can't help but suppose an impact.
So I'm very curious as to what the current supposed
trend (identified in your article, of moving away from the "home-ownership
for every family" model to the "most everybody is renting their abode" will
do to the traditional American middle-class.
It's going to be an interesting next 50 years or
so.
David Fordham
July 11, 2011 reply from Bob Jensen
Hi David,
It will be very difficult to isolate the impact of home ownership apart
from other factors affecting the U.S., including birth control technology,
tax law changes, trends in delaying marriage, trends in couples living
together without marriage, reduced numbers of children per household, career
mobility, government policy on welfare that almost destroyed families the
some population sectors, collapse of housing values, increasing proportion
of women having long-term careers, etc.
Bob Jensen
Bob Jensen's helpers for personal finance are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
Investment Clubs, Hedge Funds, and Tax Implications
Investment clubs commenced with
friends in communities and/or work
places that sometimes made social events
out of studying investments and pooling
small amounts of money in a fund that in
turn was managed by the group as a whole
---
http://en.wikipedia.org/w/index.php?title=Special%3ASearch&redirs=0&search=Investment+club&fulltext=Search&ns0=1
I also think of an hedge fund as a
much larger investment club where a
professional investor generally manages
the investments for a group of
individuals who join that index fund.
Hedge funds, like lower end investment
clubs, do not sell shares in the club to
the public in general. An advantage and
a disadvantage of not going public is
that such funds, until recently, are not
subject to state and Federal securities
laws and SEC oversight, although since
the adverse publicity (read that Madoff
Hedge Fund) of the failed attempts are
being made by lawmakers to rein in on
hedge funds ---
http://en.wikipedia.org/wiki/Hedge_fund
The Madoff Hedge Fund turned out to be
the largest Ponzi Scheme in the World
(aside from the Social Security Fund of
the U.S. which is a Ponzi scheme not yet
shut down).
Investment Club Software ---
http://en.wikipedia.org/wiki/Investment_club_software
An Investment Club Helper Site
---
http://investmentclubsonline.com/result.php?Keywords=Investment%20Clubs
Note that investment clubs should
understand state and local tax laws
regarding investment club returns and
liquidations.
IRS Publication 550 (2008),
Investment Income and Expenses
http://www.irs.gov/publications/p550/index.html
Abusive Tax Scheme Investigations -
Fiscal Year 2009 ---
http://www.irs.gov/compliance/enforcement/article/0,,id=187267,00.html
Bob Jensen's taxation helpers are
at
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
A Nobel
Laureate Talks About the 4% "Rule" in
Personal Finance
Many retirees are advised to follow the
4% rule for managing spending and
investing. William F. Sharpe and his
co-authors argue that following this
advice can lead to overpayments and
surpluses. To avoid these pitfalls,
retirees also have to have a clear idea
of how much risk they are willing to
take.
Stanford Graduate School of
Business News, April 2010 ---
http://www.gsb.stanford.edu/news/research/sharpe_4percent.html
"What You Need to Know About
Socially Responsible Investing," by
Adam Bold, Yahoo Finance, April
19, 2011 ---
http://finance.yahoo.com/news/What-You-Need-to-Know-About-usnews-2251466802.html?x=0
Technology for Personal Finance
"Goalkeeping Gets Easier in the
Finances Arena New Mint.com Feature
Offers User-Friendly Options That Help
Savers Set Up Budget Objectives and
Stick to Them," by Katherine Boehret,
The Wall Street Journal, June 30,
2010 ---
http://online.wsj.com/article/SB10001424052748704911704575326914251218780.html
When most people hear the word
"budget," they groan about all the
numbers and spreadsheets involved in
setting financial goals. Instead
they procrastinate and continue
spending without any specific
savings goals. Case in point: I
recently postponed a meeting with my
financial planner because I didn't
have the energy after a long
business trip to work through my
finances.
Now Mint.com, a website that already
offers user-friendly options for
studying how one's money is spent,
has introduced an easy way to set
budget objectives, link them to
accounts and learn specific steps on
how to reach those goals. The goals
can even be personalized with
digital photos, like an image of the
car you're saving up to buy. And
this service, which launched
Tuesday, doesn't cost a cent.
I've been testing Intuit Inc.'s
free, updated Mint.com service,
specifically focusing on its new
Mint Goals feature. The idea of
adding goals that tie into real
accounts has been a long time coming
for the finance-management website.
Mint previously offered a Planning
section on its site, but it required
too much manual input, including
setting up personal budget
categories, and guesswork about how
much one should spend.
The Goals feature uses pop-up
windows where users can quickly
input data, like annual salary, to
get estimates on how much they can
afford to spend on things like a
vacation, as well as how much they
need to save for that vacation.
Monthly savings estimates can be set
to aggressive savings plans or
conservative ones with just a mouse
click.
Finances in One Place
Mint.com has been around for almost
three years and is already used by
millions of people. Its proprietary
algorithms encrypt data so people
will feel confident enough to input
their usernames and passwords for
their online financial accounts,
allowing them to see all of their
financial activity in one place.
These accounts include those tied to
credit cards, banks, retirement
savings and others. Mint is known
for displaying colorful visuals like
pie charts and graphs, so it's easy
for people to see where they're
spending their money or how it's
being invested.
Mint Goals is a new tab on the
Mint.com site, and clicking on it
directs users to a group of eight
popular goals and one that can be
customized (more will be added over
time). The preset list includes
goals to get out of debt, buy a
home, buy a car, save for college,
take a trip or save for retirement.
A digital checklist in each goal
called "Next Steps" gives people
serious, doable tasks to complete,
so they can actually make progress
toward a goal in ways other than
just putting money aside. This
instant gratification saved me from
doing a lot of calculating.
The Best Account
When you set up a goal for the first
time, Mint suggests what type of
account would work best for saving
toward it. Examples include a 529
savings plan for people who are
saving to put their kids through
college or a Roth IRA for retirement
savings. Mint will also tell you the
provider with the best interest
rate.
Unlike some other websites that
encourage saving, like SmartyPig.com,
Mint isn't a bank, so you'll have to
leave the Mint site to create
accounts and manage money transfers
rather than starting them right on
the site. Aaron Patzer, the
company's founder and CEO, expects
the site will enable setting up
savings accounts and money transfers
by the end of this year.
Each goal includes the overall
amount of money intended to be
saved, today's balance, planned and
projected dates for reaching the
goal and how much has been saved
this month (like $200 of $750). I
liked looking at Mint's colorful
thermometers, which quickly showed
me how I was progressing in a
particular goal.
For example, the Buy a Home goal
checklist includes steps like
finding a Realtor, getting
homeowner's insurance and getting
prequalified for a loan. A panel
beside each of these items also
offers an educational explanation of
what these steps really mean. Many
explanations include links to a blog
called MintLife, where blog posts
from Mint employees and some
freelancers offer deep explanations
about financial questions.
Ads With Context
The Goals feature comes with
contextual ads, which help it remain
free. One checklist item suggests
opening a high-yield savings account
and also offers links to the
Discover and American Express
websites, which offer the accounts.
If you've started a Mint Goal to
save for a trip to Iceland, travel
insurance is suggested, along with
Web links to sites that sell trip
insurance.
While these links might allow people
to get started right away on a
particular task, they also beg the
question of whether these are the
best options for users—or just the
biggest advertisers on Mint. Mr.
Patzer explained that companies for
these ads are chosen according to
what's best for the user and are
selected from a list of savings
options ranked by the site's
editors.
Goals can be linked to several of
your accounts on Mint so they're
updated with real-time data. A
long-term retirement goal can link
to a 401(k), brokerage account and
retirement account. If the stock
market takes a dive and money is
lost in an account, that loss is
automatically reflected in the
overall goal's balance. If you tie a
savings account to a goal to save
for a house, every dollar added to
that account (on the bank's end) is
automatically reflected in the goal.
Mint already gave people a visually
engaging way to know more about what
their money is doing, but Mint Goals
give people a real reason to come
back to the site more often.
Mint.com home page ---
http://www.mint.com/
Bob
Jensen's personal finance helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Spent: A Poverty A Game 23% of
America Does Not Need to Play
Adrienne Gonzalez, Jr. Deputy
Accountant, February 26, 2011 ---
http://www.jrdeputyaccountant.com/2011/02/game-23-of-america-does-not-need-to.html
Bob Jensen's threads on personal finance
---
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelper
"2010: The Year of the Roth
Conversion?" by Rich Arzaga,
Journal of Accountancy, January 2010
---
http://www.journalofaccountancy.com/Issues/2010/Jan/20091743.htm
This year will be the Year of the
Tiger, according to Chinese custom,
but it also could be remembered by
investors as the Year of the Roth
Conversion, a decision that can have
a large impact on investors’ ability
to build wealth during their
lifetime and preserve wealth for
beneficiaries.
Prior to 2010, anyone (except
married taxpayers filing separately)
with an annual adjusted gross income
(AGI) of no greater than $100,000
could convert a traditional IRA to a
Roth IRA. The AGI cap has prevented
higher-income earners, a class of
savers that might have benefited
most from this strategy, from
participating. However, under the
Tax Increase Prevention and
Reconciliation Act of 2005 (TIPRA)
these previously ineligible
taxpayers will be eligible to
participate starting this year
(including married but separate
filers). In fact, there is an
incentive to take action in 2010:
Everyone who converts this year may
defer and spread income recognition
from the conversion over tax years
2011 and 2012. A conversion in 2010
thus could reduce the marginal tax
rate and total taxes due on what
otherwise would be a larger
single-year distribution. The 10%
penalty tax otherwise imposed on
early or excess distributions from
an IRA does not apply. A conversion
could be an attractive retirement
income and estate planning strategy
for wealthy individuals and
high-income earners who seek to
reduce taxes later in life and
transfer more wealth to
beneficiaries tax-free. But like any
other approach to income and taxes,
this decision is eventually based on
a set of sustainable assumptions and
specific objectives of the taxpayer.
ADVANTAGES OF A ROTH ACCOUNT
A chief advantage of a Roth IRA is
that it has more flexible rules
concerning distributions. Also,
taxpayers who are otherwise unable
to contribute to a traditional IRA
can take advantage of a Roth IRA’s
appreciation free from tax on gains.
Other advantages of a Roth IRA
include:
-
In most instances,
contributions can be
withdrawn at any time
without penalty. Earnings
may be withdrawn without tax
or penalty if the taxpayer
is at least age 59½ and has
held the Roth account for at
least five years. Similar
strategies that provide for
tax-free growth and
withdrawal are the IRC § 529
plans for college education
and cash-value life
insurance policies. Each has
its strengths and
limitations.
-
With a Roth IRA, there are
no required minimum
distributions (RMDs) like
those that apply to
traditional IRAs when the
taxpayer reaches age 70½.
For affluent families with
sufficient resources for
retirement income, the RMD
can seem an unnecessary
expense with a confusing
formula. From a client’s
perspective, eliminating
RMDs can provide a great
sense of relief from the
annual hassle of calculating
and managing these
distributions.
-
Unlike with traditional IRA
accounts, taxpayers can
continue to contribute to a
Roth IRA after reaching age
70½—also an attractive
feature as Americans
redefine retirement and
continue to be industrious
into later years. Starting
in 2010, a retired couple
can contribute $12,000 each
year (including the “over-
50 make-up” amount) into
Roth accounts. The AGI
limits on regular
contributions to a Roth IRA
still apply, but it is
possible to make
nondeductible contributions
to a traditional IRA and
convert them to a Roth,
regardless of AGI. These
contributions grow free of
income tax indefinitely,
creating significant value
for taxpayers as well as
their beneficiaries.
-
A tax-diversified retirement
distribution strategy also
helps with Social Security
planning. Up to 85% of
Social Security benefits are
taxable. When calculating
modified adjusted gross
income (MAGI) for Social
Security purposes, taxpayers
must include all taxable and
tax-exempt income and 50% of
their Social Security
benefits, but not Roth IRA
distributions. Having a Roth
IRA to supplement retirement
income can be very important
in managing the taxability
of Social Security benefits.
IDEAL
CONVERSION CANDIDATES
Some taxpayers may benefit more than
others from converting to a Roth
IRA. Assuming there are no cash flow
issues, risk management gaps, other
tax planning considerations that
need to be weighed against the
benefit of a conversion, advance tax
issues at play, or adverse
legislative changes, taxpayers who
stand to benefit the most are those
who:
-
Are wealthy.
-
Seek to reduce estate
settlement costs.
-
Won’t need to draw income
from converted retirement
accounts.
-
Are young, high-income
earners.
-
Believe their tax bracket
will be the same or higher
in retirement, or more
specifically, when they draw
income from their qualified
retirement accounts. The
attractiveness of
traditional IRAs and
qualified retirement plans
depends on the assumption
that taxpayers will have a
lower effective tax rate
after retirement, when the
deferred taxes on the
savings will come due.
Conversely, taxpayers whose
tax rate seems more likely
to be the same or higher in
retirement might just as
soon pay taxes on income now
and accumulate tax-free
gains. Consider the
conversion comparison in
Exhibit 1.
Continued in article
Bob Jensen's taxation helpers are
at
http://faculty.trinity.edu/rjensen/BookBob1.htm#010304Taxation
History and Strategy
of Poker ---
http://en.wikipedia.org/wiki/Poker
Warning: Gambling online is not recommended since the games tend to be
rigged according to an expose on CBS Sixty Minutes
Interestingly many of the online games are run by Canadian Native Americans not
subject to gambling laws in Canada.
CBS Sixty Minutes tied some online cheating to organized crime located
--- Guess? Would you believe Las Vegas.
"Online Poker
Study: The More Hands You Win, the More Money You Lose (even if the games
are honest) ," Science Daily, January 13, 2010 ---
http://www.sciencedaily.com/releases/2010/01/100112152410.htm
The likely reason, said Cornell
sociology doctoral student Kyle
Siler, whose study analyzed 27
million online poker hands, is that
the multiple wins are likely for
small stakes, and the more you play,
the more likely you will eventually
be walloped by occasional -- but
significant -- losses.
This finding,
Siler said, "coincides with
observations in behavioral economics
that people overweigh their frequent
small gains vis-à-vis occasional
large losses, and vice versa." In
other words, players feel positively
reinforced by their streak of wins
but have difficulty fully
understanding how their occasional
large losses offset their gains.
Continued in article
"How
Poker Can Make You a Better Investor,"
by Bob Frick, Kiplinger, January 7, 2010 ---
http://www.kiplinger.com/features/archives/how-poker-can-make-you-a-better-investor.html?kipad_id=x
Ever watch professional poker
players calculating the odds, then
coolly dissecting their opponents?
Many of the same skills the top
players use can help you be a better
investor. Success at both investing
and gambling, it turns out, has much
to do with controlling emotions. And
playing a little poker can help you
recognize, and avoid, emotional
traps that endanger your most
important stack of chips -- your
portfolio. But you need to know what
to look for.
The
psychological issues that drive
investing and gambling decisions
aren’t merely similar. They are
“identical,” says Andrew Lo,
director of the Massachusetts
Institute of Technology Laboratory
for Financial Engineering and one of
the leaders in the field of
behavioral finance (listen to
our podcast with Lo).
It’s easy to
find investment professionals and
professional poker players who
agree. Says poker pro Daniel
Negreanu, who holds four World
Series of Poker bracelets and two
World Poker Tour Championship
titles: “Having emotional stability
and emotional control is key to both
investing and poker.”
Can you gain that control at a poker
table? Aaron Brown is among many who
think so. Brown is a onetime finance
professor and former portfolio
manager for Prudential Securities
who is now a risk manager for hedge
funds. He’s also the author of
The Poker Face of Wall Street
(Wiley, $17). Says Brown: “People
tell me playing poker is risky.
Investing for a financial lifetime
without playing poker is risky. I’d
much rather make these mistakes at
the table.”
And by
mistakes, Brown means the common
emotional errors that plague
investors. The burgeoning fields of
investor psychology and
behavioral finance are
uncovering more about these errors
all the time, and they are the
subject of a
year-long series
co-produced by
Kiplinger’s and Nightly
Business Report on PBS.
By playing some poker, “you can find
out your tendencies to make
emotional mistakes, and then you can
guard against them,” says Frank
Murtha, a behavioral-finance
consultant with a PhD in counseling
psychology (his dissertation
explored the effect of psychological
errors in gambling). Murtha helps
clients from investment banks,
financial-services companies and
trading firms to avoid making
psychological errors.
He’s also
co-founder of
MarketPsych,
which offers psychological-training
services to traders and money
managers and which offers a number
of online tests that any investor
can take to better understand his or
her own psychological makeup.
Most investors make few investment
decisions over a year, or even over
a lifetime. But experts agree that
just a few hours of playing poker
will take you through literally
dozens of financial decisions --
potentially a lifetime’s worth if
you were making those decisions
about your portfolio. By playing
poker while keeping in mind the
psychological errors that are also
common to investing, you can get a
lifetime’s worth of training in one
evening.
What are these errors? We’ve picked
five of the most common, and all can
be found both in investing and in
gambling. Click on each one below to
learn how they appear in poker and
investing and to find out how you
can use poker to help train yourself
not to make these errors.
Greed
Overconfidence
Regret
Seeing patterns
Holding on to losers
More on Poker and Investing
How Texas Hold 'Em Simulates
Investing
How Deepak Chopra Helped Me Become a
Better Poker Player
SPECIAL REPORT: Your Mind, Your
Money
Next page: GREED
Bob
Jensen's personal finance and investment helpers are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
Question
What is hyperbolic discounting?
"Psychology of poverty and
temptation," by Chris Blattman,
September 2009 ---
http://chrisblattman.com/2009/09/15/psychology-of-poverty-and-temptation/
Some people
are impulsive and impatient; they
prefer a dollar or a donut today far
more than a dollar or a donut
tomorrow, so much so that they’re
willing to give up shocking amounts
of dollars and donuts tomorrow for
just one today. This is one reason,
some say, that we see such high
interest rates for short-term
borrowing, from New York to
Calcutta.
Some people
are not only impulsive and
impatient, but inconsistently so.
they care a lot about a dollar today
versus tomorrow, but could care less
between getting a dollar either 10
or 11 days from now.
Economists
call this ‘hyperbolic discounting’.
Both behaviors–impatience and
time inconsistency–could be a source
of persistent poverty.
Or not.
Abhijit Banerjee presented
a new paper here
yesterday,
written with MIT colleague Sendhil
Mullainathan. They look at a number
of seemingly unusual behaviors by
the very poor–from exorbitant rates
of short-term borrowing to the low
take-up of small, high-return
investments. Impatience cannot
explain the patterns, they say. The
impatience approach also requires
the poor think differently than the
rest of the population.
Another
view: we’re all impulsive and
impatient in the same way, but over
a narrow range of goods that are
quickly and cheaply satisfied. If
you’re poor, these temptations are a
big fraction of your income. If
you’re even somewhat wealthy, they
are not. Temptations are declining
in income.
The paper
runs through half a dozen perplexing
patterns of behavior, and shows that
these simple assumptions can explain
a great deal.
This
approach has a great deal in common
with hyperbolic discounting, but is
empirically distinct (and has very
different policy implications).
Parsing out and testing these
subtleties strikes me as one of the
most important frontiers in the
study of poverty. Declining
temptation, if true, could explain
all sorts of odd behaviors. With
more than a few Uganda and Liberia
surveys on the horizon, I’m
now scheming ways to test whether
it’s true.
It’s a
difficult paper, especially for
those uninitiated in micro-economic
theory. Even if that sounds like
you: the subtle points are worth the
slog.
For an intro
to the subfield, see Senthil’s
essay,
Development economics through the
lens of psychology.
Another great
resource is Stefano Dellavigna’s
recent JEL article on
evidence from the field.
Both are ungated.
Behavioral
and Cultural Economics and Finance ---
http://faculty.trinity.edu/rjensen/theory01.htm#Behavioral
78% of
former NFL players have gone
bankrupt
or are under financial stress because of
joblessness or divorce.
Championship Rings in pawn shops, IRS
vaults, Ponzi schemer stashes offshore,
or in the clutches of ex-wives
What on earth did athletes learn in
college?
Pros seem especially susceptible
to Ponzi schemes. Some recent examples ---
Click Here
10 Ways Sports Stars
(multi-millionaires) Go From Riches To
Rags," by Lawrence Delevingne,
Business Insider, September 18, 2009 ---
http://www.businessinsider.com/10-ways-sports-stars-destroy-their-finances-2009-9
Sports
Illustrated article this year
showed
how shockingly common financial ruin
is:
-
By the
time they have been retired for
two years, 78% of former NFL
players have gone
bankrupt
or are under financial stress
because of joblessness or
divorce.
-
Within
five years of retirement, an
estimated 60% of former NBA
players are broke.
-
Numerous retired MLB players
have been similarly ruined.
If that's
not bad enough, the
recession
has made things even worse. Too much
money in real estate; investments in
Ponzi schemes; and poor financial
advising have been exposed with the
down economy.
A sign of the
times? More former stars are
selling their championship rings for
money than ever.
"It's amazing
that I heard the recession was
over," says Timothy Robins, owner of
Championshiprings.net,
who buys bling
from current and former pros and has
seen a 36% increase in sales during
the past year. "I'm getting more
calls from players than ever.
They're having a really hard time."
While just
about everyone has
lost
money
over the past
year, athletes tend to make
particularly bad financial
decisions, and it's not just
reckless spending.
How they lose their wealth ---
Click Here
http://www.businessinsider.com/10-ways-sports-stars-destroy-their-finances-2009-9#put-cash-in-a-ponzi-scheme-1
The 10 ways sports pros blow
their cash >>
Jensen Comment
The same goes for many, many movie stars
like Debbie Reynolds who, very late in
their lives, are "willing to work for
food."
The boots in Hollywood's Boot Hill
are not stuffed with savings.
How to avoid losing your money to
fraud ---
http://faculty.trinity.edu/rjensen/FraudReporting.htm
Behavioral and
Cultural Economics and Finance ---
http://faculty.trinity.edu/rjensen/theory01.htm#Behavioral
"The Best Online Tools (software, services) for Personal Finance,"
The Wall Street Journal, June 8, 2009 ---
http://faculty.trinity.edu/rjensen/PersonalFinanceTools.htm
1. Budgeting Your Money
2.
Creating a Financial Plan
3. Tracking
Investments and Getting Advice
4. Checking for Fraud
5. Keeping Track of Credit
6. Managing Loans
Details at
http://faculty.trinity.edu/rjensen/PersonalFinanceTools.htm
Bob Jensen's helpers for personal
finance ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Bob Jensen's threads on Accounting
Software ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
Money Market Funds Are Not as Risk
Free as Bank Accounts
What very
few people are talking about, however,
is a more radical solution to the moral
hazard question raised by money market
funds. Maybe the right approach now is
to acknowledge the truth. Money market
funds are not, in fact, turbocharged
bank accounts. They are investment
vehicles. However “safe” the securities
they invest in, they contain an element
of risk. Indeed, the very reason they
yield more than savings accounts is that
they are riskier. That’s how investing
works. So maybe, in this post-Reserve
Fund world, it’s time for the industry —
and investors — to stop pretending that
money funds are risk-free. As it turns
out, there is a pretty simple way to do
this. As it also turns out, the money
market fund industry is dead-set against
it.
Joe Nocera, "It’s Time to Admit That
Money Funds Involve Risk," The New
York Times, August 28, 2009 ---
http://www.nytimes.com/2009/08/29/business/29nocera.html?_r=2
Follow the Herd: Can you identify a
moral hazard here?
From
the Finance Professor Blog on October
19, 2009 ---
http://financeprofessorblog.blogspot.com/
"KaChing, a Web site where 400,000
amateur and professional investors
manage virtual portfolios. Others
have logged on to see what the
investors on the site are doing and
make the same trades in their own
real portfolios.
On Monday, KaChing is to add a new
twist. Customers can set up
brokerage accounts that
automatically mirror the trades of a
money manager, some of them
professionals.
“The idea of an asset manager
showing all his research, his
holdings — it’s unheard-of,”"
The trouble with
mutual funds is that investors can feel
as though they have put their money in a
black box. The 90 million Americans with
money in funds know little about fees,
what securities their money is invested
in and who is in charge . . . KaChing
has attracted a roster of prominent
early investors from Silicon Valley who
have financed the company with $3
million. They include Marc Andreessen,
co-founder of Netscape; Kevin Compton of
Kleiner Perkins Caufield & Byers; and
Jeffrey Jordan, chief executive of
OpenTable, the online reservation
service. The angel investors have also
been investing their own money through
KaChing during the pilot period. “The
concept is great — the ability to tap
into not just the wisdom of the crowd,
but to be able to identify and invest
with the particular geniuses in the
crowd that stand out,” said Mr.
Andreessen, who has invested $100,000
using the site.
Claire Cane
Miller, "Site
Lets Investors See and Copy Experts’
Trades," The Wall Street Journal,
October 19, 2009 ---
http://www.nytimes.com/2009/10/19/technology/start-ups/19kaching.html?_r=1
Jensen
Comment
Money managers are human. Some might
loose their tempers at a company to the
point they lead their herds off cliffs
just to get back at a company. Some
money managers may be secretly greedy
for themselves or friends and family and
lead their herds with hidden agendas
based on greed. For example, this is one
way for a money manager to help out one
of his buddies who founded a small
technology company with high financial
risk at the moment.
Stock
pickers in the WSJ's "Heard on the
Street" and other financial news sites
are watched closely such that they are
not manipulating their private accounts
with hidden agendas that make themselves
wealthy at the expense of readers.
I'm not
arguing that there's anything illegal or
even unethical about KaChing's "new
twist." I just feel that the lemmings
should be aware of the moral hazard.
The
KaChing homepage is at
http://www.kaching.com/
Stocks are
still the best investment for the long
run. But maybe not for your long run.
Justin Fox, "Are Stocks Still
Good for the Long Run?" Time Magazine,
June 15, 2009 ---
http://www.time.com/time/magazine/article/0,9171,1902843-2,00.html
Also see Jim Mahar's June 10, 2009
summary at
http://financeprofessorblog.blogspot.com/
In particular this references a study by
Arnott that asserts that over the past
40 years the stock market underperformed
the bond market. In my opinion, if you
into bonds for the next 40 years they'd
better be inflation-indexed bonds such
as Treasury TIPs.
Bob Jensen's threads on the
Efficient Markets Hypothesis ---
http://faculty.trinity.edu/rjensen/theory01.htm#EMH
PBS Television will now answer
your personal finance questions ---
http://www.pbs.org/newshour/insider/business/jan-june09/pocketchange_05-05.html
Personal Finance
Helpers
From Smart Stops on the Web, Journal
of Accountancy, July 2008
KEEPING IT
SIMPLE
This Smart Stop’s author
puts together a “Blueprint
for Financial Prosperity,”
working and blogging through
the complexities of personal
finance. Articles include
“Speed Up or Shift Up:
Thinking About Your Income
Path” and “Do You Have an
Opportunity Fund?” Also find
tax and investing coverage,
plus reviews of financial
planning and wealth
management books. Every
month, the author plays
“Devil’s Advocate,” where he
examines the other side of
“mainstream” or “common
sense” personal finance
ideas. Recent “Advocate”
posts include “Don’t Budget
to the Penny” and “Don’t
Just Buy Index Funds.”
THIS WEEK
IN PERSONAL FINANCE
The Carnival of Personal
Finance touts itself as “a
traveling weekly showcase of
the best blog articles on
the topic.” The carnival is
hosted by a different guest
blogger each week. In every
edition, you’ll find links
to the guest editor’s picks
of the week, typically
highlighting five to 10
posts from various sources,
which feature expert advice
on professional sites or
regular-Joe experiences on
personal sites. You can
submit your own post for
consideration, view the
schedule of upcoming hosts
or just browse the wealth of
archived articles. |
The AICPA maintains a financial
literacy site at
http://www.aicpa.org/financialliteracy/FeedThePig/
Why
mutual funds are dangerous investments
---
http://hk.youtube.com/watch?v=irZi9YZVEyo
This is good advice to a point. However,
most investors have different
circumstances such as liquidity
preferences, tax complications, and
different ages such that there may not
be a safe index fund suitable for every
investor.
Center for Retirement Research at Boston
College ---
http://crr.bc.edu/
Investment Clubs, Hedge Funds, and Tax Implications
Investment clubs commenced with
friends in communities and/or work
places that sometimes made social events
out of studying investments and pooling
small amounts of money in a fund that in
turn was managed by the group as a whole
---
http://en.wikipedia.org/w/index.php?title=Special%3ASearch&redirs=0&search=Investment+club&fulltext=Search&ns0=1
I also think of an hedge fund as a
much larger investment club where a
professional investor generally manages
the investments for a group of
individuals who join that index fund.
Hedge funds, like lower end investment
clubs, do not sell shares in the club to
the public in general. An advantage and
a disadvantage of not going public is
that such funds, until recently, are not
subject to state and Federal securities
laws and SEC oversight, although since
the adverse publicity (read that Madoff
Hedge Fund) of the failed attempts are
being made by lawmakers to rein in on
hedge funds ---
http://en.wikipedia.org/wiki/Hedge_fund
The Madoff Hedge Fund turned out to be
the largest Ponzi Scheme in the World
(aside from the Social Security Fund of
the U.S. which is a Ponzi scheme not yet
shut down).
Investment Club Software ---
http://en.wikipedia.org/wiki/Investment_club_software
An Investment Club Helper Site
---
http://investmentclubsonline.com/result.php?Keywords=Investment%20Clubs
Note that investment clubs should
understand state and local tax laws
regarding investment club returns and
liquidations.
IRS Publication 550 (2008),
Investment Income and Expenses
http://www.irs.gov/publications/p550/index.html
Abusive Tax Scheme Investigations -
Fiscal Year 2009 ---
http://www.irs.gov/compliance/enforcement/article/0,,id=187267,00.html
Bob Jensen's investment helpers
are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#WebsitesForInvestors
Bob Jensen's taxation helpers are
at
http://faculty.trinity.edu/rjensen/BookBob1.htm#InvestmentHelpers
Helpful Calculators free from the Florida Institute of CPAs ---
http://www.ficpa.org/ficpa/ResourceCenter/Calculators
Bob Jensen's threads on helpful
calculators ---
http://faculty.trinity.edu/rjensen/Bookbob3.htm#080512Calculators
Bob Jensen's personal finance
helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Question
In the public accounting profession, what's a PFS?
Hint
PFS is a new credential to put after
one's name --- it looks better than
Pfffssssttt
The American Institute of Certified
Public Accountants (AICPA) and Texas
Tech University's Division of Personal
Financial Planning have announced a
joint agreement to develop a new
educational program that will lead to
the AICPA's Personal Financial
Specialist (PFS) credential. The program
will officially begin in June 2009, but
the AICPA and Texas Tech have announced
that they will conduct a PFS Pathway
beta program or test program at AICPA
offices in Dallas November 10 through
14th. The PFS beta program consists of
four days of intense comprehensive
personal financial planning case study
in 12 technical areas, including estate
planning, employee benefits, investment
planning, financial independence, and
income tax planning. Participants take
an eight-hour multiple choice exam of
approximately 200 questions on the fifth
day.
"AICPA and Texas Tech announce new
pathway to PFS credential,"
AccountingWeb, August 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=105793
Bob Jensen's threads on personal finance
are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Bob Jensen's threads on credit reporting
are at
http://faculty.trinity.edu/rjensen/FraudReporting.htm#FICO
Bob Jensen's helpers for finding a
financial advisor are at
http://faculty.trinity.edu/rjensen/fees.htm
Bob Jensen's career helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#careers
Mutual Funds: 10 questions to test your
IQ (ten answers every investor should
know by heart) ---
http://www.azcentral.com/business/consumer/articles/2009/04/10/20090410biz-MutualFundsQuiz0410.html
"How to Prevent Investment Adviser Fraud," by Brian Carroll, Journal of
Accountancy, January 2006 ---
http://www.aicpa.org/pubs/jofa/jan2006/carroll.htm
EXECUTIVE SUMMARY |
SECTION 206 OF THE INVESTMENT ADVISERS ACT
OF 1940 provides guidelines for
investment advisers on what constitutes
fraud.
THE SUPREME COURT HAS HELD THAT THE ACT
imposes a fiduciary duty on
investment advisers to act in the best
interest of their clients by fully
disclosing all potential conflicts of
interest.
INVESTMENT ADVISERS SHOULD REVIEW CAREFULLY
SEC and other disclosure
requirements to ensure they clearly
understand potential conflicts.
INVESTMENT ADVISERS SHOULD REVIEW ALL SEC
FILINGS, client marketing materials
and other significant documents to ensure
that they have appropriately disclosed all
potential conflicts. |
Brian
Carroll, CPA, is special counsel with the
SEC in Philadelphia and an adjunct professor
at Rutgers University School of Law, Camden,
N.J. |
|
|
Alpha Return on Investment ---
http://en.wikipedia.org/wiki/Alpha_(investment)
What the professional investors
don't tell you ---
I downloaded this video ---
http://www.cs.trinity.edu/~rjensen/temp/FinancialRounds.flv
From the Financial Rounds Blog on
September 4, 2009 ---
http://financialrounds.blogspot.com/
When I
teach investments, there's always a
section on market efficiency. A key
point I try to make is that any test
of market efficiency suffers from
the "joint hypothesis" problem -
that the test is not tests market
efficiency, but also assumes that
you have the correct model for
measuring the benchmark
risk-adjusted return.
In other words, you can't say that
you have "alpha" (an abnormal
return) without correcting for risk.
Falkenblog makes exactly this
point:
In my book
Finding Alpha
I describe these strategies, as
they are built on the fact that
alpha is a residual return, a
risk-adjusted return, and as
'risk' is not definable, this
gives people a lot of degrees of
freedom. Further, it has long
been the case that successful
people are good at doing one
thing while saying they are
doing another.
Even better,
he's got a pretty good video on the
topic (it also touches on other
topics). Enjoy.
You can watch the video under
September 4, 2009 at
http://financialrounds.blogspot.com/
I downloaded this video ---
http://www.cs.trinity.edu/~rjensen/temp/FinancialRounds.flv
Bob Jensen's threads on Return on
Investment (ROI) are at
http://faculty.trinity.edu/rjensen/roi.htm
Bob Jensen's threads on market
efficiency (EMH) are at
http://faculty.trinity.edu/rjensen/theory01.htm#EMH
50 Most Common Mistakes Made by
Traders and Investors ---
http://www.ratiotrading.com/2009/09/50-common-mistakes-most-traders-make/
"Firms Take to The Tweetable Business Model," by
Kim Hart, The Washington Post, March 9, 2009 ---
Click Here
Twitter, that microblogging tool that caught on
with teens and twentysomethings using it to tell loyal followers what
they're doing at any given time -- in 140 characters or less -- is now
becoming part of the business strategy for a wide range of brands, from
Skittles to Fairfax County.
As exciting as it may be to hear about what your
friends, or total strangers for that matter, ate for breakfast, some
companies are realizing that a more effective use of Twitter is to mine it
for clients, recruit employees and answer customer service questions.
To that end, some businesses are starting to host
Twitter tutorials for employees.
Network Solutions, a Web-hosting and online
marketing company based in Herndon, held a brown-bag lunch session last week
to teach staffers how to sign up for a Twitter account, how to send messages
to individuals and how to search for people who may be talking about the
company in messages, or "tweets."
Twitter is an easy way to create buzz for a new
product launch or to alert customers to a service outage. Earlier this week,
the Skittles Web site directed visitors to a Twitter search for the term
"skittle" to see what people were saying about the candy. Attendees at
conferences and other business-related gatherings already use the service to
relate details on an unusually interesting session or to share news
announcements.
For example, at a conference focused on global
health last month, philanthropist Bill Gates released a jarful of mosquitoes
into a room to make a point about the spread of malaria.
"And people found out about that first on Twitter,"
said Steven Fisher, community and social media manager at Network Solutions.
Shashi Bellamkonda, Network Solutions' social media
swami (yes, that's his real title), organized the tutorial, attended by
about 30 people. He's a more prolific Twitterer than most, posting anywhere
from five to 15 tweets per day about anything from his daily routine to the
news. Big companies such as Dell are active in the Twitterverse addressing
customer service issues, he said.
Fairfax County government is also experimenting
with Twitter, sending out announcements about snow-induced school closings
and county board meetings.
Companies are now accustomed to monitoring blogs
and other consumer-generated content for mentions of brands -- in fact,
companies such as Arlington-based New Media Strategies have made a
profitable business out of it. Similarly, Bellamkonda wants Network
Solutions employees to take notice of any questions, complaints or other
mentions of the company that pop up on Twitter.
W. Roy Dunbar, the firm's chief executive, said it
is even more important to communicate with customers during an economic
downturn. He said he gives his social media team free rein to experiment
with new tools.
"Next time, we'll conduct the meeting entirely in
tweets," Bellamkonda said.
It may be a short meeting.
Rediscovering the Internet
The crusade for government transparency and open
data -- two of the biggest buzzwords in Washington since President Obama put
them on his agenda -- has gained momentum over the past week.
Vivek Kundra, the District's chief technology
officer, was officially named as the federal chief information officer
Thursday, ending months of speculation about what the brand-new job entails
and what it means for how government agencies use technology.
While the answers to those questions are still
unclear, the announcement prompted a collective cheer from some local
developers. As an example of what Kundra may do with federal technology
projects, many of them point to the contest he held last year called Apps
for Democracy, which challenged independent Web developers to come up with
interesting ways to use government data.
District-based Development Seed, a Web consulting
group, mashed together government data and other online resources to create
DC Bikes, a site with information about bike thefts, popular bike trails and
other information for local bike enthusiasts.
Continued in article
March 10, 2009 reply from Roger
Debreceny
[roger@DEBRECENY.COM]
Gerry
Trites asked about Investor
Relations on Twitter. I follow his
countryman, Dominic Jones
(http://twitter.com/irwebreport
and
http://www.irwebreport.com/)
closely. He
points to much going on on Twitter.
See, for example,
http://preview.tinyurl.com/amw98y
on “eBay’s lawyers are wrong to
delete earnings call information”
and
http://preview.tinyurl.com/avv4yl
on
“SEC disclaimers in the age of
Twitter”.
BTW,
if you want to see your portfolio
bump around rock bottom in real
time, you can get stocktwits at
http://stocktwits.com/ ..
Of
course, you can also follow me on
Twitter at
www.twitter.com/debreceny and
see very important, indeed earth
shattering, information such as “OMG
I fractured my big toe and can’t
ride my bike for a month” and “Yeah,
my toe is OK and I can ride again!”
<Bg>
Regards
Roger
Question
Did your grandparents give you a prepaid college 529 savings account?
"Volatility Hits Prepaid 529s," by
Jillian Mincer, The Wall Street
Journal, March 9, 2009 ---
http://online.wsj.com/article/SB123663406748876025.html?mod=todays_us_personal_journal
The market volatility that has
squeezed pension plans is having a
similar impact on one kind of
college 529 savings account -- the
prepaid plan.
Like pensions, almost all of the
plans have seen their assets
significantly drop as their
investments have plunged. At the
same time, college costs have kept
rising.
At least one state -- Alabama -- has
notified plan participants that it
will be considering options, which
could include closing enrollment,
later this month.
"It's a
potential crisis for at least some
of these plans," says Joe Hurley,
founder of
www.savingforcollege.com,
an independent
Web site that provides information
about 529 plans. "They may go to the
state and ask for funds."
About a dozen prepaid 529 college
savings plans are available. While
details of the plans vary, all allow
families to buy all or part of a
college education at today's prices.
Typically, the accounts are
guaranteed by states to at least
match in-state tuition increases.
Continued in article
Question
Are risky returns higher or lower than the risk free rate on average over long
periods of time?
First learn about the theory of
mean reversion at
http://en.wikipedia.org/wiki/Mean_reversion
"Reversion to the Mean Why treasuries
have outperformed equities," The
Economist via CFO.com,
November 10, 2008 ---
http://www.cfo.com/article.cfm/12585264/?f=rsspage
GREATER risk means greater reward,
right? Wrong, at least over the last
25 years. As the graph shows,
Treasury bonds have actually
outperformed riskier asset classes
over the last quarter century. That
is despite the long equity
bull-market from 1982 to 2000.
Treasury bonds have understandably
beaten equities this year, when the
financial sector has been in crisis
and the economy headed towards
recession. The government
bond-market always performs well at
times of crisis. But the last 25
years have been, by and large, a
pretty good time for global
economies, marked by the "great
moderation" in inflation and growth.
But the last quarter century has
been positive for all asset classes,
with government debt, corporate
bonds and Treasuries all returning
an average of around 10% a year in
nominal terms. So why have
Treasuries done so well in relative
terms? The explanation, as Jim Reid
of Deutsche Bank explains, lies in
reversion to the mean.
Asset classes can go through long
periods when they underperform,
leaving them cheap and ripe for
revaluation. That happened to
Treasury bonds, which suffered four
consecutive decades of negative real
returns from the 1940s through the
1970s. At that point, Paul Volcker,
then the Federal Reserve chairman
and now an advisor to
President-elect Barack Obama,
successfully brought down inflation,
allowing investors to lock in
double-digit Treasury yields. It was
one of the great historical buying
opportunities.
Such a period is extremely unusual.
Since 1900, the average annual
return from Treasuries has been
4.6%, or 1.5% after allowing for
inflation. In contrast, American
equities have delivered 9.3%, or 6%
in real terms.
The current poor performance of
stockmarkets reflects, of course, a
reversion to the mean after the
excesses seen during the dotcom
bubble, when the rolling 25-year
annual return of US equities reached
a remarkable 16%. On a 10-year
basis, the return from equities has
now slumped to minus 3.5% in real
terms.
. . .
There are two important caveats.
First, this kind of analysis is no
use at all in predicting short-term
movements. Second, markets spend
very little of the time at fair
value (on Mr Reid's calculations),
tending to veer wildly from one
extreme to another. All three asset
classes might still be overvalued;
after all, the figures show returns
over the last quarter century have
been well above average.
Jensen Comment
This speaks in favor of jumping out of equity at the instant a bubble begins to
burst. but it's generally difficult to identify a true bubble early on. Plus the
media is always urging the public not to panic and to hang on to equity
investments on the theory that what goes down goes back up.
The media, however, probably does not have a clue about
mean reversion.False positive bailouts can lead unnecessary transactions
costs. Also if your equity investment is tied up in a pension fund like CREF,
you don't have fast reacting options.
Helpers in planning for retirement ---
http://www.plan-for-retirement.com/
Naked Shorts: Irreverent Investment Ideas ---
http://nakedshorts.typepad.com
Advertisement Free Personal
Finance Blogs ---
http://pfblogs.org/blog/29
Bob Jensen's investment
helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#Finance
Question
Where can you find one of the best definitions of hedge funds and summaries of
alternative hedge fund strategies?
Answer
Where else than Wikipedia ---
http://en.wikipedia.org/wiki/Hedge_fund
Bob Jensen's rather puny set of threads
in comparison is under the H-terms at
http://faculty.trinity.edu/rjensen/acct5341/speakers/133glosf.htm#H-Terms
Tax Breaks for College Savings: Now may
be the best time for starting to save for the college education of your children
or grandchildren
"529
College Savings Plans remain a mystery
to most parents," AccountingWeb,
August 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=104018
Parents are counting on credit to
counterbalance skyrocketing college
costs, according to The State of
College Savings, a survey to assess
the state of college savings
conducted by the College Savings
Foundation. Fifty-four percent have
saved less than $5,000 toward their
goal and almost 40 percent expect to
take at least 10 years to dig out of
the daunting debt expected to send
their children to college.
The survey of 447 parents, who span
income levels and crisscross the
country, revealed for the first time
that American families intend to
rely on long term-debt, rather than
savings, to fund their children's
futures. Even though 79 percent of
all respondents would be highly
disappointed if their children could
not afford to go to college, over
half, 51 percent, of that group has
saved less than $5,000 per child.
Continued in article
Morningstar, the
global investment research firm has
published its annual list of the best
and worst 529 plans – when it comes to
earning long-term returns for college
savers – and the overall opinion smacks
of optimism. Some of the worst plans
from years past have folded up and gone
away, while others continually strive to
improve.
AccountingWeb, August 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=105846
"Twelve
tips for funding that college
education," AccountingWeb, August
2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=104016
There's a
shelf of financial bestsellers whose titles now sound absurd: Ravi Batra's The
Great Depression of 1990; James Glassman's Dow 36,000; Harry Figgie's Bankruptcy
1995: The Coming Collapse of America and How to Stop It. There’s BusinessWeek’s
1979 description of "the death of equities as a near permanent condition,
Michael Lewis, "The Evolution
of an Investor," Blaine-Lourd Profile, December 2007 ---
http://www.portfolio.com/executives/features/2007/11/19/Blaine-Lourd-Profile#page3
As quoted by Jim Mahar in his Finance Professor Blog at
http://financeprofessorblog.blogspot.com/
As a
group, professional money managers
control more than 90 percent of the U.S.
stock market. By definition, the money
they invest yields returns equal to
those of the market as a whole, minus
whatever fees investors pay them for
their services. This simple math, you
might think, would lead investors to pay
professional money managers less and
less. Instead, they pay them more and
more...Nobody knows which stock is going
to go up. Nobody knows what the market
as a whole is going to do, not even
Warren Buffett. A handful of people with
amazing track records isn’t evidence
that people can game the market. Nobody
knows which company will prove a good
long-term investment. Even Buffett’s
genius lies more in running businesses
than in picking stocks. But in the
investing world, that is ignored. Wall
Street, with its army of brokers,
analysts, and advisers funneling
trillions of dollars into mutual funds,
hedge funds, and private equity funds,
is an elaborate fraud.
Michael Lewis,
"The Evolution of an Investor,"
Blaine-Lourd Profile, December 2007
---
http://www.portfolio.com/executives/features/2007/11/19/Blaine-Lourd-Profile#page3
As quoted by Jim Mahar in his Finance
Professor Blog at
http://financeprofessorblog.blogspot.com/
"Smart Stops on the Web," Journal of Accountancy,
January 2008 ---
http://www.aicpa.org/pubs/jofa/jan2008/smart_stops.htm
PERSONAL FINANCIAL
PLANNING |
|
CENTER IN ON PFP SERVICES
http://pfp.aicpa.org
Want to offer financial
planning services to your
clients? Visit the AICPA’s
Personal Financial Planning
Center for PFP resources to
get you started. Click the
“Events” tab to register for
Web seminars, including “The
Mathematics of Estate
Planning” on Jan. 16, or
research the requirements
and application process for
the Personal Financial
Specialist credential. In
the upcoming months, the
section’s Executive
Committee will roll out a
suite of updated practice
guides on various PFP
technical and practice
management topics, available
to PFP Section members and
PFS credential holders at no
cost.
STRAIGHT FROM THE SOURCE
www.treasurydirect.gov
Individuals and financial
institutions can buy and
redeem Treasury securities,
including bills, notes, TIPS
and series I and EE savings
bonds, directly from the
U.S. Treasury at this Smart
Stop. Not confident enough
to invest yet? Enter the
“Individuals” or
“Institutions” sections, and
then use the “Research
Center” to access a glossary
of terms and in-depth
coverage of auctions and
products or to take a guided
tour of the site. There is
also a calendar of upcoming
Treasury auctions, as well
as auction regulations and
recent results.
STAY DEBT-FREE
www.moneycrashers.com
At this “Guide to Financial
Fitness,” author Erik
Folgate chronicles his
experience with getting into
and out of debt, providing
recent graduates and young
professionals with the
education needed to be
financially successful.
Follow the “11 Principles”
series, which includes tips
on saving money for the
unexpected and creative ways
to boost your income, or
read articles on financial
planning, such as “Don’t Let
Your Fears Stand in the Way
of Investing” and “Stay
Positive When Paying Off
Debt.” |
|
|
GENERAL INTEREST |
|
ERISA EDUCATION
www.dol.gov/elaws/ERISA/Fiduciary.htm
Developed by the Employee
Benefits Security
Administration, this site’s
fiduciary adviser provides
an overview of the basic
fiduciary responsibilities
applicable to private-sector
retirement plans under the
Employee Retirement Income
Security Act (ERISA).
Designed for accountants and
other third-party service
providers, the adviser uses
a series of questions to
determine whether a
retirement plan falls under
ERISA requirements, and if
so, what they are. This
Smart Stop also has a
comprehensive listing of
ERISA resources at
www.dol.gov/elaws/ebsa/fiduciary/resources.htm.
FLY HAPPY
www.yapta.com
Whether you’re planning a
vacation months in advance
or jetting off for a
last-minute business trip,
use Yapta as “Your Amazing
Personal Travel Assistant.”
Registered users tag their
desired or frequently
traveled flights, then are
alerted by e-mail when the
prices of those routes drop.
Already bought a ticket? If
you booked through an
airline’s Web site, submit
your confirmation code or
forward Yapta your
confirmation e-mail. If the
ticket price drops below
what you paid, the site will
let you know whom to call
and what to say to receive a
refund for the difference or
a travel voucher.
STUDENT INSIDERS
http://njscpa.typepad.com/examcram
What does it take to become
a CPA these days? Follow a
few New Jersey Society of
CPAs student members, who
are chronicling their
trials, tribulations and
triumphs on the society’s
Exam Cram blog. Browse the
archives to read Scott
Sandford’s journey as he
studied for and took the CPA
Exam while working at
Deloitte, or join the
NJSCPA’s new student
recruit, Priscilla Jenkins
of Merrill Lynch & Co. in
Pennington, N.J., as she
sits for part of the exam in
February. Also take some
time to read Tomorrow’s CPA,
a monthly
e-newsletter for accounting
students, written by
accounting students, on the
NJSCPA’s Students and
Educators site (www.njscpa.org/students).
GO GLOBAL
www.jimhamiltonblog.blogspot.com
Jim Hamilton, a principal
analyst at Wolters Kluwer
Law & Business and a leading
contributor to the CCH
Federal Securities Law
Reporter, emphasizes
SEC rulemaking,
international, federal and
state regulations, and
industry trends on his
“World of Securities
Regulation” blog. Under
“Tools,” click “Posts by
Topic” for a complete
listing of the blog’s
auditing, financial
reporting, Sarbanes-Oxley
and PCAOB coverage, or look
for new posts on
principles-based
regulations, the mortgage
lending market and
international issues.
—Megan Pinkston |
A Government Website for Helpers
in Personal Finance
MyMoney.gov is the U.S. government's
website dedicated to teaching all
Americans the basics about financial
education. Whether you are planning to
buy a home, balancing your checkbook, or
investing in your 401k, the resources on
MyMoney.gov can help you do it better.
Throughout the site, you will find
important information from 20 federal
agencies government wide.
My Money.gov ---
http://www.mymoney.gov/
The AICPA's Financial Literacy Helper
Site ---
http://www.360financialliteracy.org/
Bob Jensen's finance helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm
Annuity Buyer's Guide ---
http://www.annuitybuyersguide.com/
David Bach's "Latte Principle" ---
Click Here A Penny Saved Compounds to Much More Than a Dollar Earned
Jim Mahar provided the following two links:
"Penny's Add Up to Millions,"
Free Money Finance, October 15, 2007 ---
http://www.freemoneyfinance.com/2007/10/pennies-add-up-.html
Here's a post from
Yahoo Finance that details the author's
struggle with her husband to take his
lunch to work. But the essence of what
she says is really that saving/watching your pennies is the key
to wealth. Her
thoughts:
I'm
convinced that for the average
person who wants to build wealth,
pennies count.
Pennies
have a funny way of snowballing into
dollars, and then hundreds, and then
thousands, especially if you use
them to buy the stocks of
well-managed companies. Consider the
story of a parking attendant who
earns $20,000 a year but has amassed
a $500,000 equity portfolio. Or the
one about a group of New Yorkers who
managed to save for a down payment
on a (very expensive, very tiny)
piece of the Big Apple. Or the clan
of seven dubbed "America's cheapest
family," who paid off their mortgage
in nine years on a salary of $35,000
a year.
I've seen article after article bashing
David Bach's "Latte Principle" -- the
idea that if you save on small spending
you can amass a large amount of wealth.
The main argument against it is that
people should be paying attention to
large expenditures -- that's where the
real difference is made. But Bach isn't
saying to ignore the expensive decisions
in life. He's just aware that for many
of us there are small amounts we spend
every day without really thinking about
how much they end up costing us. And
that if we just limit a few of them and
save that money, we can save a good
amount throughout the years.
Continued in article
"How to Save a Bundle of Money,"
Free Money Finance, October 15,
2007 ---
http://www.freemoneyfinance.com/2007/10/how-to-save-a-b.html
Yahoo Finance has
a list of ten money drains along with the annual
costs of each of them.
I view this as a
list of where we all can save a bundle
of money. Here's their list as well as
the annual amounts spent on each of them
(in other words, what you could save if
you eliminated them):
1.
Coffee -- $360 per year. 2. Cigarettes -- $1,660 a year. 3. Alcohol -- $3,650 per year. 4. Bottled water from convenience
stores -- $365 per year. 5. Manicures -- $1,068 per year. 6. Car washes -- $348 per year. 7. Weekday lunches out -- $2,350 a
year. 8. Vending machines snacks -- $260
per year. 9. Interest charges on credit card
bills -- $4,868 in interest (over
time). 10. Unused memberships -- $480 per
year.
Now of course I wouldn't suggest that
someone cut out everything and eliminate
all of life's pleasures. After all, we
should use part of our money to enjoy
ourselves. But for those people out
there looking for a way to save a bit
extra, for those who simply "can't make
it on what I earn", and for those who
would simply like to pay down their
debt, this is a pretty good list to
consider cutting down on -- even if it's
for a short period of time. And you
don't have to eliminate each of the
items above, simply consider cutting
back on them. There's still tons of
savings available by cutting your car
washes, manicures, or alcohol
consumption in half.
And if these
aren't enough money saving ideas, check
out my list of ways to save money from
2005-2006 as
well as my 2007 list.
Jensen Comment Of course eliminating all the above would not necessarily be wise. If there's
five feet of snow on the ground, I'm not about to wash my own car. Yet getting
the car washed in winter is more important than in summer if you live where they
salt and sand the roads. Spending $358 each winter car washes may well save
thousands if you can, thereby, double the life of your car.
New cars
lose 60% of value in the first four years. Most people waste more money on cars and interest charges for car
financing than any other single cash drain in their lives, including the cost of
housing. Cars are a necessity of life for most of us who have no convenient
public transportation alternatives. But frequent trading in of good cars for new
cars is a monumental mistake in finance. Leasing is also a synonym for
stupidity. Insiders call it "fleecing
a car." But I'm grateful for ignorant people who are constantly turning in
good owned or leased cars. Most of the cars I've owned over the years were
turned back leased cars. Great mechanics put my previously-owned or
previously-leased vehicles back in top shape, and I save a bundle relative to
their prior owners. If you must finance your next vehicle, please be a smart
shopper and be informed how dealers cheat ---
http://faculty.trinity.edu/rjensen/FraudDealers.htm
I lived in San Antonio for 24 years where over
500 cars per month are stolen. See the video ---
http://www.youtube.com/watch?v=TQPSXCqBqz4 My answer was to buy an old car (usually a station wagon) and make it look even
less desirable to the thousands of car thieves cruising about San Antonio by day
and by night. Little did thieves know that underneath the hood was a new power
train and other features that made my old heaps just like new. I always remember
a comedy show that featured a company in Los Angeles that would ghettoize a new or relatively-new car to make it look like a junk yard dog. My city cars were like that. My
wife and I were more safe since our cars were of little temptation to
carjackers. But my children generally crouched down in the seats or asked to be
let out a block away so their friends would not see them in my cars.
Next to car financing, the biggest mistake most people make is credit card
financing to a point where they seldom zero out what they owe on credit cards.
This is the "dirty secret" of that makes credit card companies suck billions
upon billions of dollars out of the economy ---
http://faculty.trinity.edu/rjensen/FraudReporting.htm#FICO
When we're about to go on long trips, I overpay monthly expenses ahead of time
so that if we're delayed in returning home we never have to worry about being
charged interest or late payment penalties. For example, I put huge credit
balances into our credit card accounts before going on a long adventure.
Do I buy into David Bach's "Latte Principle?"
Well yes and no. I do not believe in Spartan living so I can watch my savings
grow for the sake of watching my savings grow. I don't drink latte, but I also
opt for four-star or five-star hotels or lovely country inns when my wife and I
are on adventures. Expensive restaurants are generally wastes of money, but we go to them
when the mood is right and/or the friends we're with prefer a top restaurant.
Often you can eat just as well in the hotel's lounge as in the expensive
restaurant down the hall. There's a huge difference between what you splurge for on daily (like credit
card interest and latte) versus what you splurge for infrequently. When I used
to come home at night and have a couple of drinks daily, I drank cheap Boca
Chico rum in my cubalibras. Now that I don't drink daily, I splurge on fine wine
and expensive liquor once in a while.
In the final analysis, I would have to say that I live better in retirement
because I pretty much followed the "Latte Principle" before it was called "Latte
Principle." Most of my travels in life were
financed by others who made me sing (lecture) for my supper, but I enjoyed
the fellowship and strokes of these types of trips more than I did boring
leisure vacations. I spent as much as I could possibly afford on land and
houses, but these generally returned more than I paid for them. I spent as
little as possible on cars and preferred to buy finely-tailored suits in upscale second hand shops
(look for Second Looks in San Antonio and Austin).. I think most of the former owners
of my suits had passed on in life.
I never argue with my wife over money even when she tips almost as much as
the check itself. I never object when she hands out ten dollar bills to
receptionists, postal clerks, trash haulers, window washers, and bell
ringers outside the Wal-Mart stores. She's thrifty but likes a lot of new things
she generally buys on sale. She seldom shops in stores. But the UPS truck stops up here in the mountains
nearly every day. While my wife is wearing the "8" and "0" buttons off on phone in our den
(mostly she orders gifts), I'm on the computer ordering everything from books to
groceries to space heaters from Amazon.com (a great, great place to shop). Our UPS driver's name is
Joe, and if I'm not at home he comes into the basement and assembles what he's
just delivered. Will your UPS driver do that?
I truly got my money's worth out of faculty clubs. I would've joined
expensive country clubs but I never had time for a round of golf even once a
week. Such is the price one pays for being a workaholic.
It's easier for a workaholic to live by the "Latte Principle." But most of us
workaholics are doing what we like best.
October 17, 2007 reply from Barbara Scofield
[scofield@GSM.UDALLAS.EDU]
When my husband was in training to be a police
chaplain, the trainer began talking about the issue of stolen cars by
pointing to my husband and saying, “What kind of car do you drive?” Rob, my
husband, responded, “A ’99 Saturn wagon.” The police trainer told him, “You
can leave the keys in your car.”
Barbara W. Scofield, PhD, CPA
Investment Theory versus Practice:
What are volatility "smiles" versus "smirks"?
From the Financial Rounds Blog on
April 28, 2008 ---
http://financialrounds.blogspot.com/
Informed Traders and Options Markets
If you were an informed trader,
would you trade in the options
market or in the market for the
underlying asset? Finance theory
says you'd trade in the options
market because of increased
leverage.
Now here's another paper that
supports this idea. In their March
2008 paper Xiaoyan Zhang, Rui Zhao
and Yuhang Xing look at whether
relatively expensive put options can
be used as "bad news" indicators.
Here's the abstract of their paper:
The shape of the volatility
smirks has significant
cross-sectional predictive power
for future equity returns.
Stocks exhibiting the steepest
smirks in their traded options
underperform stocks with the
least pronounced volatility
smirks in their options by
around 15% per year on a
risk-adjusted basis. This
predictability persists for at
least six months, and firms with
steepest volatility smirks are
those experiencing the worst
earnings shocks in the following
quarter. The results are
consistent with the notion that
informed traders with negative
news prefer to buy
out-of-the-money put options,
and that the equity market is
slow in incorporating the
information embedded in
volatility smirks.
Read the whole thing here. ---
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1107464
In case you're not familiar with the
term, the volatility "smile" refers
to the phenomenon that implied
volatility increases for options
that are further out of the money.
If the increase in implied
volatility is greater on one side
than on the other, the pattern is
known as a volatility "smirk". In
the case of this paper the smirk is
used as an indicator of the degree
to which puts or calls are
relatively expensive. For example,
if calls are relatively more
expensive, that is taken as an
indicator that informed traders have
been buying calls because they have
positive information about a stock,
with expensive puts being an
indicator that traders possess bad
news.
In addition to predicting subsequent
returns, the authors also find that
firms with the most expensive put
options are more likely to have the
worst negative earnings shocks in
the following quarter.
All in all, a pretty cool paper that
indicates how information from one
market can predict movements in
another.
Jensen Comment
Do you suppose that Sony's Camera's new
frown-fixing tool (called
Happy Face Retouch) can be pointed
at a volatility graph and turn a smirk
into a smile?
Bob Jensen's investment and personal
finance helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Question What are 120-20 and 130-30 funds?
These
funds are called 120-20 or 130-30 funds, reflecting their proportion of
assets held long and sold short, with the proceeds from the short sales
used to leverage the long position with borrowed funds, so that the long
exposure is more than 100 percent. “The idea seems to have caught on,”
said Barry P. Barbash, a Washington lawyer who once headed the
investment management division at the Securities and Exchange
Commission. “Public funds using this strategy seem to be multiplying
almost daily.” Robert D. Hershey, Jr., "This Fund Concept Blurs Old Lines," The New
York Times, July 8, 2007 ---
Click Here
"Twenty-Five Ways to Reduce
Investment Risk," The Aleph Blog , July 21, 2007 ---
http://alephblog.com/?p=186
The Aleph Blog (Helping
Institutions and Ordinary People Invest Better by Focusing on Risk
Control) --- http://alephblog.com/
From Smart Stops on the Web,
Journal of Accountancy, July 2007 ---
http://www.aicpa.org/pubs/jofa/jul2007/news_web.htm
WEALTH MANAGEMENT |
|
SECURING A
REPUTABLE BROKER www.nasd.com/brokercheck
The NASD has answered the calls of investors looking for
background information on potential financial service
providers. The organization’s BrokerCheck Program lets users
research current or formerly registered securities firms,
individual brokers and regulated Investment Adviser firms.
It also provides a comprehensive 10-year business and
licensure history and list of disclosure events, including
criminal actions, customer complaints and disciplinary
actions by regulators against the firm or broker. Investors
receive an electronic disclosure report as well as access to
other educational services, including the Professional
Designation Database and state disclosure programs.
BECAUSE
YOU’RE WORTH…MORE www.freemoneyfinance.com
Whether you’re living on a student’s budget or a CFO’s
salary, Free Money Finance has innovative ideas for
increasing net worth, budgeting and maximizing retirement
savings that you can immediately put into practice. On
Mondays, check out “Star Money Articles,” a posting of news
and tips from several of the Web’s popular personal finance
sites. Take a few minutes on Fridays to read “One Year Ago,”
popular posts from the prior year, to jump-start a frugal
weekend.
THE
BENEFITS OF TAX KNOWLEDGE www.irs.gov/retirement
Visit this Smart Stop for the latest
tax news and information affecting the employee plans
community. CPAs can search for resources on employee plans
(EP) examinations and enforcement, retirement plans, benefit
audits and correcting EP errors. Click on the
“EP/Forms/Pubs/Products” link for access to PDF versions of
EP forms and publications, plus in-depth instructions for
form 5500, Annual Return/Report of Employee Benefit Plan,
and form 5330, Return of Excise Taxes Related to
Employee Benefit Plans.
NOTHING IS CERTAIN
BUT… www.deathandtaxesblog.com
Visit Chicago-area attorney Joel
Schoenmeyer’s Web site to brush up on topics straddling the
lines between law, accounting and wealth management. Death
and Taxes—The Blog offers estate planning and administration
news and commentary, plus coverage of legal issues about
real estate, gift and income taxes, trusts and charitable
giving. |
Naked Shorts: Irreverent Investment Ideas
---
http://nakedshorts.typepad.com
Corporate Financial Reports O'Keefe Accounting Library Searches
http://library.sau.edu/bestinfo/Majors/Accnt/accindex.htm
Advertisement Free
Personal Finance Blogs ---
http://pfblogs.org/blog/29
Mortgage Professor's Tips on Whether or Not to Pay
Off Your Mortgage Early ---
http://www.mtgprofessor.com/early_payoff.htm
How Mortgages Work ---
http://money.howstuffworks.com/mortgage.htm
The AICPA's Financial Literacy Helper Site ---
http://www.360financialliteracy.org/
What are current mortgage rates? ---
http://biz.yahoo.com/b/r/m.html
Lord Help Us!
Stockpickr has a list of
the Top 100 Business Blogs
Damodaran Online: A Great Sharing Site from a Finance Professor at New
York University and Textbook Writer ---
http://pages.stern.nyu.edu/%7Eadamodar/
Jim Mahar's finance sharing site (especially note his great
blog link) --- http://financeprofessor.com/
Financial Rounds from an anonymous finance professor ---
http://financialrounds.blogspot.com/
Beware of the So-Called Investor Education Programs (especially beware of
infomercials) "I don't see frankly much out there that really does
the job, and that's partially because investors are their own worst enemy," says
former SEC Chairman Arthur Levitt. "They refuse to invest skeptically, and are
too easily seduced by all the purveyors of financial products that prey upon
their worst instincts." "Investor Education 101: How to Avoid Scams: Outreach Programs
Target Most-Vulnerable Americans, But Success Is Hard to Assess," By Lynn
Cowan, The Wall Street Journal, May 9, 2006; Page D3 ---
http://online.wsj.com/article/SB114713241888747241.html?mod=todays_us_personal_journal
The Invisible Problem of
Risk Blindness," by
Kevin Dowd, Financial Engineering News, November 2006 ---
http://www.fenews.com/fen52/risk-reward/risk-reward.html
Help for the younger generation's planning ahead for their
financial futures "A Glimpse of the Future: Savings and asset accumulation among
Americans 25–34," Journal of Accountancy, January 2007 ---
http://www.aicpa.org/pubs/jofa/jan2007/special2.htm
Also see
http://faculty.trinity.edu/rjensen/fees.htm
Are Hedge Funds Out of Control?
(from the
University of Pennsylvania's Wharton School
Click Here
Foreign Direct Investment (FDI) in the U.S. ---
http://www.fdi.net/
"Are You Saving Enough for
Retirement? A Guide to Figuring It Out and Funding It," by Jonathan
Clements, The Wall Street Journal, July 12, 2006; Page D1 ---
http://online.wsj.com/article/SB115265948927403942.html?mod=todays_us_personal_journal
So what's your
personal liability and how can you trim it? Brace yourself: We're in
for some scary math.
• Bridging the
gap. "Corporate accounting requires companies to look at their
pension obligations, to use reasonable assumptions and to fund
those obligations on an annual basis," notes Charles Farrell, a
financial consultant in Medina, Ohio. "A little bit of that
corporate discipline can be helpful on the individual side."
Mr. Farrell's
advice: Start by deciding how much income you will need from your
portfolio to supplement whatever you expect from Social Security and
any pensions you're entitled to. Next, multiply your desired
portfolio income by 20, to get the target size of your retirement
nest egg. (This assumes you use a 5% withdrawal rate in the first
year of retirement, and thereafter step up your withdrawals with
inflation.)
For instance,
if you're looking to garner $40,000 in initial retirement income
from your portfolio, you would need $800,000 saved. Let's say you
have $300,000 salted away. That means your current unfunded
retirement liability is $500,000.
To find out how much you need to save each
month to amass this $500,000, head to
www.dinkytown.net
and call up the savings-goal calculator. One problem: Thanks to
inflation, your target retirement income and your required savings
could be whole lot bigger by the time you quit the work force. What
to do? Mr. Farrell suggests thinking in terms of after-inflation
"real" rates of return.
To that end,
when using the dinkytown.net calculator, set inflation at zero and
input what you think your annual return will be, over and above
inflation. If your portfolio includes a decent helping of stocks and
you're careful about investment expenses, you might opt for a 4%
real return.
Finally, enter
your portfolio's value, your current monthly savings and your time
horizon. The calculator will then tell you how much you really need
to save each month to accumulate your desired nest egg. But here's
the key: To combat inflation and ensure you have enough at
retirement, you will need to increase your monthly savings along
with inflation.
• Raising the
price. Does your required savings rate seem a little steep? If
anything, you should probably be socking away even more, for two
reasons.
First, many
financial planners consider a truly safe withdrawal rate to be 4.5%
or even 4%. That means you ought to amass as much as 25 times your
desired $40,000, boosting your retirement liability to $1 million.
This is
clearly news to a lot of ordinary investors. According to a study
recently conducted for insurer New York Life, 40% of those surveyed
weren't sure how much they could safely withdraw from a portfolio --
and an additional 29% thought that a safe retirement withdrawal rate
was 10% or more. "There's a pretty big gap between expectations and
reality," says Ted Mathas, chief operating officer at New York Life.
Second, while
you might want only $40,000 a year in portfolio income, you should
be prepared to spend as much as $74,095 per person. That's the
national average cost for a private nursing-home room, according to
insurer MetLife's Mature Market Institute. In fact, if both you and
your spouse need care at the same time, you could have to fork over
some $150,000 a year.
Assuming you
get $20,000 a year from Social Security, your out-of-pocket cost
might be $130,000. Based on a 5% withdrawal rate, that means you
need $2.6 million socked away. How's that for a retirement
liability?
"Long-term
care is a huge potential cost," Mr. Farrell says. "If you're not
rich enough to self-insure, you've got to think about buying a
long-term-care policy that gives you at least minimal coverage."
• Trimming the
tab. A long-term-care policy is one way to dial down your unfunded
retirement liability.
What else can
you do? To squeeze more retirement income out of your assets, you
could take out a reverse mortgage and use maybe 25% or 50% of your
savings to buy an immediate-fixed annuity that pays lifetime income.
In addition,
"you could try to lower your fixed costs," Mr. Farrell says. "A
smaller house is better, because that should lower your property
taxes and lower your utilities. You might also want to reassess how
many cars you have."
Of course,
cutting back isn't easy. "Try to downscale before you retire, to see
if you're comfortable with that," Mr. Farrell suggests. "If you're
not, you might want to retire a little later."
Postponing
retirement -- unpalatable as it seems -- can transform your chances
of a comfortable retirement. By delaying, you will have more time to
save and more time for your investments to grow. You will also
shorten your retirement, so you can be more aggressive in spending
down your nest egg.
As an added
bonus, delaying retirement will allow you to postpone taking Social
Security and purchasing an immediate annuity. Result: When you start
Social Security and when you buy your annuity, you will get even
more income.
Investment Helpers From the
Journal of Accountancy January 2007 Smart Stops on
the Web ---
http://www.aicpa.org/pubs/jofa/jan2007/news_web.htm
Onward and Upward
www.mynextphase.com
Here CPAs and financial advisers can get a free trial membership and
explore some of the nonfinancial considerations of retirement, such
as how to handle change and revisit past interests as future
options. Retirement Resources has links to Web sites on health,
recreation and working after retirement. Find books on successful
retirement in Suggested Reading, get the free newsletter Next
Phase News and download research findings in “Retirement Trends
and Truths.”Get the
Financial Facts http://kimsnider.blogs.com
This blog, created by the founder and president of Kim
Snider Financial Communications, has dozens of posts from financial
journals and Web sites on topics including annuities, bonds, cash
flow investments, financial education and investment principles.
Find out how Kim Snider invests her own money and learn her
portfolio management strategies with a free informational session.
A Helping Hand
www.finaid.org
Personal financial planners with clients that have kids in school
will want to bookmark this Smart Stop for guides on navigating
financial aid, loan and scholarship information. Find links to aid
programs from the military and federal and state governments, as
well as resources on education tax benefits and financial aid
applications. Get calculators to project college costs and help with
family budgeting. Or go to Beyond Financial Aid for a financial aid
checklist and links to college selection and jobs and internship
sites.
Money Matters
www.pfblog.com
Follow this blogger’s personal finance journey to learn about the 10
best domestic equity fund managers and how to properly close a
credit card account. Look up your life expectancy in the Archives or
go to the PFBlog Digest to get the scoop on paying off student
loans, starting salaries for college grads and how 529 plans affect
financial aid eligibility.
Make a Clean Break
www.womansdivorce.com
Financial advisers looking for divorce resources for female clients
can go to this site’s Downloadable Documents section for
state-specific divorce forms, parenting, separation and property
settlement agreements. The Legal Considerations for Women and
Financial Information sections offer divorce strategies and advice
on choosing an attorney.
From 'Smart Stops on the Web', Journal of Accountancy,
December
2004, Page 29 --- http://www.aicpa.org/pubs/jofa/dec2004/news_web.htm
SMART
STOPS ON THE WEB |
Back to Basics
mutualfunds.about.com
CPAs looking for a refresher course on mutual
funds will find articles such as “Determining Your Mutual
Fund’s ‘Cost Basis’” and “Avoiding Internet Investment
Scams.” Users can sign up for a free 10-day online course on
the basics of mutual fund investing or a mutual fund newsletter.
Other resources include links to broker ratings of funds,
financial calculators and glossaries.
The Fund Finder
www.mutualfundsnet.com
CPAs looking for investment information for
their clients will want to bookmark this Web site. In addition
to free mutual fund sponsor searches in categories such as
socially responsible corporate and government mutual funds,
users can find information about investment conferences and
links to breaking industry news. CPA broker-dealers can add
their resumes to the database or check job postings from listed
companies.
For Fund Facts
www.mfea.com
Investment advisers looking to educate their
clients on mutual fund options will find detailed information on
topics including taxes and fund risk at this stop on the Web.
Users can find explanations of the differences among mutual
funds and a glossary of investment terms or search for funds,
create model portfolios or use calculators for college,
retirement and tax-savings plans.
The Kids and College section of this Web stop links to sites
that offer investment resources for money-minded children, such
as calculators to help them decide how much allowance to save
for major purchases and a dictionary of basic investment terms.
Satisfy Your Need to Know
www.ici.org
Here visitors can find free statistics on money
market mutual fund assets or reports on the latest industry
developments, such as “SEC changes SRO Procedures for Filing
Rule Changes.” Other sections include A Guide to Understanding
Mutual Funds, Frequently Asked Questions and a news archive
dating back to 1995.
Keep Track of the Market
www.123jump.com
Users can register for free to keep tabs on
their mutual funds at this e-stop, which offers general
business, current and archived earnings news, as well as
QuoteStream to see how your picks measure up on the Nasdaq, NYSE
and S&P 500 stock index. Visitors also can get two daily
e-mail newsletters, Earnings Ticker and Ticker
AM—Business News Update. |
From Smart
Stops on the Web, The Journal of Accountancy, May 2006 ---
http://www.aicpa.org/pubs/jofa/may2006/news_web.htm
Invest Time for a Laugh
www.dailyreckoning.com
Who says researching investment information can’t be fun? At this Web
site, visitors not only get the latest market headlines and insights,
but also some laughs. For example, the Essentialist Glossary in the
Extras section defines Bill Gates as “where God goes for a loan.” Users
also can read special reports on investing in India or value-investing
strategies, subscribe to the free Daily Reckoning financial
e-letter or get five secrets for investing in small- and micro-cap
stocks.
-
-
-
October 13, 2006 message
from Dan Blystone (no relation to Trinity University's Bob Blystone)
Dear
Bob,
I am
writing to request that you kindly consider adding a link to my
website (TradersLog.com) on your page here:
http://faculty.trinity.edu/rjensen/bookbus.htm
I think
your visitors may find it useful and interesting, and it would
help my startup gain some valuable exposure.
The
website description is: Portal website for traders and investors
featuring articles, analysis and a community forum.
Please
let me know if you have any questions.
Best
Regards,
Dan
Blystone TradersLog.com (312) 593-1322
Reply from Bob
Jensen
Hi Dan,
I added
your message to
http://faculty.trinity.edu/rjensen/Bookbus.htm
However, I
think I have some better places to also add your message. It
will be in the forthcoming (October 31) edition of New
Bookmarks.
I have
added your link to my investor helper module at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Since you
provide a great set of links to economic and financial
statistics, I also added your link at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#EconStatistics
Best of
luck in your venture.
Bob Jensen
|
A deep interest in numbers and finance and a desire to help the
average investor led Eric Tyson, MBA '89, to write a series of
"Dummies" books in areas about personal money management.
http://www.gsb.stanford.edu/news/bmag/sbsm0311/feature_tyson.shtml
Top Online Brokers, Barron's, March 10, 2003, Page
24
STAR POWER
Our first-ever 4-1/2-star rating goes to
optionsXpress, with seven other brokers getting strong four-star
scores. Check also the scores in categories most important
to you.
Broker |
Trade Execution |
Ease of Use |
Range of Offerings |
Research Amenities |
Reports and Customer Access |
Costs |
Weighted Total |
Star Rating |
optionsXpress |
4.8 |
4.3 |
4.5 |
4.6 |
4.1 |
4.0 |
26.5 |
****1/2 |
TradeStation |
5.0 |
4.0 |
3.9 |
4.5 |
4.0 |
4.5 |
25.9 |
**** |
Terra Nova |
4.8 |
3.8 |
3.8 |
3.8 |
4.6 |
4.0 |
25.2 |
**** |
Ameritrade Apex |
4.0 |
4.5 |
3.7 |
4.6 |
4.1 |
3.3 |
24.6 |
**** |
Wall St.*E |
4.5 |
3.0 |
4.8 |
3.4 |
4.2 |
4.5 |
24.3 |
**** |
Wall St. Access |
3.7 |
4.5 |
4.8 |
3.9 |
3.3 |
3.0 |
23.5 |
**** |
SieberNet |
3.8 |
4.2 |
3.6 |
4.1 |
4.2 |
3.0 |
23.4 |
**** |
CyBerTrader |
4.7 |
4.0 |
2.5 |
4.2 |
3.9 |
3.5 |
23.2 |
**** |
E*Trade
(Power) |
3.4 |
3.0 |
4.2 |
4.2 |
4.3 |
3.1 |
22.6 |
***1/2 |
Harrisdirect |
3.6 |
3.5 |
4.5 |
4.4 |
3.7 |
1.9 |
22.5 |
***1/2 |
Fidelity |
3.4 |
3.5 |
4.3 |
3.7 |
4.4 |
2.0 |
22.3 |
***1/2 |
Charles Schwab |
3.4 |
3.7 |
4.1 |
4.4 |
4.2 |
0.4 |
21.9 |
***1/2 |
Scottrade |
3.8 |
3.8 |
3.5 |
3.7 |
3.2 |
4.0 |
21.8 |
***1/2 |
E*Trade (Standard) |
2.5 |
4.0 |
4.0 |
4.2 |
4.4 |
1.6 |
21.6 |
***1/2 |
Interactive Brokers |
4.3 |
3.7 |
3.0 |
2.7 |
3.3 |
4.9 |
21.4 |
***1/2 |
Preferred Trade |
4.8 |
3.7 |
3.4 |
2.4 |
3.1 |
3.9 |
21.3 |
***1/2 |
myTrack |
4.0 |
3.5 |
3.2 |
3.6 |
3.5 |
3.0 |
21.2 |
***1/2 |
MB Trading |
4.3 |
3.6 |
3.3 |
2.7 |
3.5 |
3.5 |
21.1 |
***1/2 |
TD Waterhouse |
3.0 |
3.0 |
4.6 |
3.4 |
3.7 |
3.1 |
20.9 |
***1/2 |
Brown & Co. |
2.7 |
2.5 |
3.3 |
2.6 |
2.6 |
5.0 |
17.5 |
*** |
Brokerage America |
1.7 |
3.5 |
3.1 |
3.0 |
2.6 |
5.0 |
17.5 |
*** |
JB Oxford |
3.1 |
2.5 |
3.5 |
2.0 |
2.7 |
3.4 |
17.0 |
*** |
Vanguard |
2.7 |
3.1 |
2.8 |
2.4 |
3.3 |
1.4 |
16.5 |
**1/2 |
Merrill Lynch Direct |
2.2 |
2.7 |
3.0 |
3.8 |
3.0 |
0.7 |
16.4 |
**1/2 |
American Express |
2.9 |
3.7 |
2.3 |
3.0 |
1.8 |
2.2 |
16.0 |
**1/2 |
Strong Funds |
1.4 |
3.6 |
2.5 |
3.1 |
2.7 |
2.8 |
15.7 |
** |
Firstrade |
2.2 |
2.5 |
2.6 |
2.5 |
2.5 |
3.8 |
15.4 |
** |
Quick & Reilly |
2.2 |
2.4 |
3.3 |
3.2 |
2.4 |
1.3 |
15.3 |
** |
|
|
-
Standard & Poors: A good place to start when looking into
investment funds --- http://snurl.com/SPfunds
Bob Jensen likes Vanguard ---
http://www.vanguard.com
Consumer Reports subscribers can access an excellent helper
site for personal finance ---
http://finance.ConsumerReports.org
A separate subscription for online access is available that also
provides a discount to the hard copy magazine subscription.
Employees have seen once-lush 401(k) retirement
accounts--already whipped by two years of stock market
losses--shrink even more in the summer's market slide. But
some 44 million workers have another asset: a
defined-benefit pension plan
We provide details on exchange-traded mutual
funds, and how they might save you money on your
year-end income taxes.
Our expert advice and recommendations for the many
families who can benefit from this plan.
Here, the details on retail theft and how
consumers are paying the price.
Now that you know what to buy, find the best
places to buy it, with our e-Ratings.
|
|
Key |
|
* |
indicates
a product that is part of our continual-testing program. |
R |
indicates
a Ratings report. |
A |
indicates
an archive Ratings report. Many of the tested models may no
longer be available. |
The Consumer Reports home page is at
http://www.consumerreports.org
A complete index of all reports is available at
A to Z index
The Securities and Exchange Commission (SEC) and the
North American Securities Administrators Association (NASAA) have announced the
launch of a new Web site designed to provide information about money managers,
financial planners, and other investment advisors.
http://www.accountingweb.com/item/59363
"The Internet as an
Investment Tool," by Sarah Phelan, Journal of Accountancy,
August 2001 --- http://www.aicpa.org/pubs/jofa/aug2001/phelan.htm
EXECUTIVE
SUMMARY |
CPA/FINANCIAL PLANNERS NEED TO BE WEB SAVVY. The
Internet makes it possible for CPA/financial planners and
individual investors to be notified on-screen when news
breaks about a particular stock.
INVESTORS FOLLOW A STOCK BY WATCHING its price and
trading volume and factors such as the P/E ratio and
volatility rating compared against the overall market’s.
The Web can help do this cheaply, accurately, at any time of
day and without consulting a stockbroker.
AN ELECTRONIC MODEL PORTFOLIO can “test drive”
an investment’s behavior. A CPA/financial planner should
look for charts offered by these services, including those
that compare the stock to a benchmark over time and record
the user’s unrealized capital gains.
THE SECURITIES INVESTOR PROTECTION CORPORATION (SIPC)
protects up to $500,000 of securities (limited to $100,000
for cash) held in a customer’s brokerage account. There is
no reason for a CPA, or a CPA’s client, to do business
with a broker that does not offer SIPC protection.
MANY INTERNET BANKS OFFER FREE Web-based
calculators, such as those for mortgage interest rates. A
Web calculator from a respected site can provide useful
ballpark numbers for a mortgage or an easy way to benchmark
a price.
SECURITY IS A MUST FOR ANYONE connecting to the
Internet, whether by dial-up modem or broadband connection.
Get a good antivirus program—and use it. Encryption is
important, too. Look for 128-bit encryption when
transmitting confidential data over the Internet.
|
Cool
Tools
Many of these sites
are commercial, but minimal use often is free. The first
part of this sidebar lists sites by function.
Calculators
Cash flow and credit.
www.kiplinger.com
offers Dr. Tightwad and an eConsumer column.
www.bankrate.com
lets you review your credit report.
Growth.
www.smartmoney.com
has an excellent compound interest calculator as well as a
percent change calculator to measure how much an asset has
increased in value.
Margin.
www.sec.gov
offers a margin calculator.
Yield.
www.investinginbonds.com
offers a taxable vs. tax-free yield comparison calculator.
Cars
www.kiplinger.com
offers CarFinder, an interactive feature-by-feature search.
Its calculators include “Which is better: a rebate or
special dealer financing?” and it has an auto lease vs.
purchase comparison tool.
Model
Portfolios
These are some of
the sites that offer model, or “fantasy,” portfolios.
www.fool.com
www.kiplinger.com
www.money.com
www.morningstar.com
www.smartmoney.com
Mortgages
www.bankrate.com.
Calculate a mortgage rate payment and chart trends. The
“Monthly Checkup” feature answers the question: “Can
you save money on your existing mortgage?”
www.smartmoney.com
has a refinancing calculator and a “Should You Prepay?”
worksheet.
Retirement
www.morningstar.com
has a Center for Retirement.
www.ssa.gov
offers Social Security benefit information.
Risk
Management
www.sec.gov
offers EDGAR: A Quick Tutorial, which shows how to search
for information that companies and mutual funds must reveal
in their filings with the SEC.
Risk-tolerance questionnaires can be found at
www.fidelity.com,
www.moneycentral.com
and www.vanguard.com.
Screen
for Advice
www.moneycentral.com
has an Adviser Finder.
www.sec.gov
has a Central Registration Depository database.
www.validea.com
rates analysts and professional stock-pickers.
Screen
for Potential Investments
www.morningstar.com
has the following: Stock Selector, Fund Selector, Stock
Compare, Fund Compare.
www.smartmoney.com
offers a watchlist with onscreen alerts and instant quotes
(registration required).
Web
Sites with More Useful Information
www.kiplinger.com
has wide-ranging information on investing, managing and
spending money, chats with editors, the Boiling Point forum,
Dr. Tightwad column, an eConsumer column and more.
www.morningstar.com
has market news, fund picks, stock picks, analyst research
and alerts. Paying customers get access to premium features.
www.schwab.com
is designed for worldwide use by Schwab investors. Market
news, charts and updates, a learning center and a mortgage
center.
www.sec.gov.
The site of the U.S. Securities and Exchange Commission.
Information and publications, including “how to” and a
Complaint Center. Has a mutual fund cost calculator as well
as a tool for comparing mutual funds.
www.smartmoney.com
has quotes, market updates, chat, newsletters, a Stocks to
Watch feature, upgrades, downgrades, IPOs.
www.yahoo.com,
which is the granddaddy of Internet portals, offers many
resources including business news updates. |
- Mutual Fund sites recommended in the Journal of Accountancy,
August 2002, Page 25 ---
http://www.aicpa.org/pubs/jofa/aug2002/news_web.htm
Resources and
Reading Materials
www.mfea.com
CPAs providing investment planning advice can find
information about assessing risk tolerance, the benefits of mutual
funds and emerging markets at the Mutual Fund Education Alliance Web
site. Practitioners can have clients fill out a personality profile to
pinpoint how aggressive, conservative or moderate an investor they
are, as well as find definitions in the site’s glossary.
Get Answers From
Experts
www.brill.com
Brill’s Mutual Funds Interactive (MFI) Web site
offers a free subscription to two newsletters and guidance from
experts—such as certified financial planners—at its Answer Desk
section. MFI’s site also has current and past articles such as
“Fund Managers to Issuers: More Disclosure, Please” and “Taming
the Interest Rate Beast.”
Investment
Information for All
www.invest-faq.com
Beginner, intermediate and expert investors and their
CPA advisers can get free answers to mutual fund questions, as well as
read articles about bonds, derivatives, financial planning and trading
at this Web site. Users also can subscribe to its e-mail newsletter
gratis.
Guide to Investing
www.investorguide.com
This Web site houses a wealth of information on
investing and personal finance including articles, links to news and
commentary and a snapshot on the performance of the Dow Jones
industrial average and the Nasdaq. CPAs can point clients to the
University section with information for all levels of investors—from
the beginner to the pro. And the site’s word list links to
www.investorwords.com
(see below) for definitions.
A Comprehensive
Glossary
www.investorwords.com
“With over 6,000 definitions and 20,000 links
between related terms,” this is one URL investment brokers and
financial planners will want to bookmark. Its home page includes three
categories: a main glossary, a word of the day that can be e-mailed
directly to the user and a recently added terms section to help
frequent visitors narrow their queries.
-
- The SEC launched an online margin calculator that
helps an investor estimate the likelihood of his or her broker’s
issuing a margin call—for insufficient account equity—in the next
30 days, three months or a year
(
www.sec.gov/news/headlines/margincalc.htm
).
-
- There isn't a lot (or anything?) on FAS 133/138 here, but this is a
tremendous resource for risk management from a finance perspective ---
Risk Management Special Report -- FinanceWise
http://www.financewise.com/public/edit/riskm/rmindex.htm
-
-
Yahoo Finance is
Bob Jensen's Other Favorite
A great listing of links on options, derivatives, futures and
commodities --- http://www.investingsites.com/options_derivatives.htm
-
The SEC's Ten Questions
to Ask About Any Investment Opportunity
-
Click
here to view Bob Jensen's Helpers
Click here to view
Bob Jensen's Links on FAS 133, 138, and IAS 39
(Accounting
for Derivative Instruments and Hedging Activities)
First Research, Inc.
Publishes seven- to fourteen-page targeted Industry Profiles on over
100 industries.
http://www.accountingweb.com/firstres/index.html
Advanced Stock Information
http://www.stockadvanced.com/
(note that ratios are available)
Enter a symbol and click "go!" to get the
following information: Stock Prices, Options, Stock Splits, Charts, Live Stock
Quotes, Stock Performance, Earnings Estimates, Analyst Opinions, Company
Performance, Stock Valuation, Broker Reports, Company Profile, Earnings Release
Dates, Latest News, Fundamentals, Intraday Charts, Forum Discussions, Technical
Charts, Annual Reports, Significant Events, Institutional Ownership, Financial
Ratios, Insider Trading, SEC Filings, Financial Statements, Stock Dividends,
Competition, Momentum Rating, Management Discussion, Conference Calls, Short
Interest, and more.
-
-
-
Yahoo! Business and
Economy:Finance and Investment
-
Yahoo! Business and
Economy:Finance and Investment:Futures and Options
-
Yahoo! Business and
Economy:Finance and Investment:Investment Models
-
Chart Patterns, commodity chart patterns,
charting, technical analysis, commodity price chart analysis, futures, options trading
-
http://www.ceoexpress.com/
riskview (Java site that computes Value at Risk, VAR),
Derivatives
-
RISKWeb
ISDA Home Page (Financial Instruments Derivatives)
-
Advanced Investment
Technologies Center (Financial Instrumetns Derivatives)
-
Applied Derivatives Trading (Financial
Instruments Derivatives)
-
Derivatives Research Unincorporated (Don
Chance, Financial Instruments Derivatives)
-
Ernst & Young
LLP - Download Library - SFAS 133 Financial Instruments Derivatives
-
Ernst & Young
LLP - Download Library - SEC Rules on Financial Instruments Derivatives
-
An Introduction to
Investment Theory
-
Financial Management
Education Cases
Family Money
http://www.familymoney.com/
IPO Express (investing in intial public offerings)
http://www.edgar-online.com/ipoexpress
Some Tools for the Timing of Investments
http://www.mirat.com/
dowjones.com - free services from the The Wall Street Journal.
http://dowjones.com/
Financial information and message board service (Raging Bull)
http://www.ragingbull.com/
OffRoad Capital (advertises that it provides investment deals not available anywhere
else) http://www.offroadcapital.com
-
Financial Engines, Inc. (William
Sharpe Investment Advice)
-
INFO SEC Glossary
-
Introduction to Options
-
Welcome to TermFinance (Glossary of
Derivative Fiancial Instruments)
Layer Eight Interest Rate Derivatives - Finance, Derivatives and
Economics Sites
-
An Economic Information and Economic
Analysis Web Site: The Dismal Scientist (Indices, Statistics)
-
Two Thumbs Up: An
Excel-based "Movie" (term structure of interest rates)
-
ASK DR. RISK [Margrabe / Derivatives /
Options / Swaps / Risk Management / Model Risk]
-
A Tour Through the
Web's Business Sites: Top Sites For Financial, Economic, and Business Information.
-
THE DERIVATIVE 'ZINE [Margrabe /
Derivatives / Options / Swaps / Risk Management / Model Risk]
-
Event Risk Indicator
(Suzanne Winegar Project 2 Link)
-
OptionSource.Com Home Page (Options
Trading Tutorials)
-
Evaluation of
Value-at-Risk Models Using Historical Data
-
Layer Eight Interest Rate Derivatives
-
The Derivatives
Bookshop : VAR: Understanding and Applying Value-at-Risk
-
ABREMA: Basic concepts: audit risk
-
ABREMA: Activity
Based Risk Evaluation Model of Auditing
-
Site Map (finance, glossary, risk,
investment)
-
The Chicago Board Options Exchange (CBOE)
- The world's largest options market!
Chicago Board Options Exchane Education Tutuorials at
http://www.cboe.com/education /
-
Futures and Options at the Chicago
Mercantile Exchange
-
The Chicago Board of Trade: World's
Largest Futures and Options Exchange
Market Risk Disclosure FAQ
-
Index for ACCT 5341
International Acccounting Theories
-
NEWS.COM Investor
-
The Ultimate 1998 Guide to MUTUAL FUNDS
-
CNCURRENCY.COM, YOUR PERSONAL FINANCE
ADVISOR
-
Quote.com, Inc.
-
Data Broadcasting Corporation Home Page
Deloitte & Touche Risk Management
& Control: Visual Assurance
-
InvestorGuide - The Leading Guide to
Investing on the Web
-
Welcome to RateNet, Your Financial
Connection.
-
Welcome To The Largest Mortgage Resource
Site
-
Mortgage 101
-
Site Map (finance, glossary, risk,
investment)
-
BUSINESS RESOURCES
-
MoneyMinded Homepage (Investment Help for
Women)
-
Nightly Business Report
-
Disclosure Global Access Home Page
-
Personal Finance Web
Sites (Extensive List of Links )
-
We're the Dolans (Personal Finance)
-
Bloomberg PERSONAL
-
Bloomberg Online
-
StockMaster
-
Assemble your NASDAQ stock portfolio and
get quotes e-mailed to you.
-
OnlineInvestors.com - The First Site Just
For Investors Who Trade On The Web
-
BUSINESS CYCLE INDICATORS (Economic
indicators)
-
IMF International
Capital Markets 1997--Contents (Online Journal)
-
Event Risk Indicator
(Suzanne Winegar Project 2 Link)
-
The Universal Currency Converter(tm)
-
NEWS.COM Investor
-
WSRN.com: Research A
Company (Accounting Education, Financial News, Fiancial Markets)
-
OptionSource.Com Home Page (Options
Trading Tutorials)
- Country Briefings (international statistics) from The Economist
http://www.economist.com/countries/
- Facts and statistics (Fast Facts) ---
http://gwu.edu/~gprice/handbook.htm
-
CIA Publications
(includes economic statistics)
-
CNNfn - the financial network
-
DBC Online Quotes
-
Deloitte & Touche PeerScape Home Page
-
Fidelity
-
FINANCE AND
INVESTMENTS: WWW VIRTUAL LIBRARY
-
GNN Personal Finance Center
-
Holt Report Index
Page
-
http://www.deanwitter.com/
-
Intuit Inc.
-
iTools! - Directories, Financial Markets,
References
-
Moody's Investors Service
Welcome to CAROL (online annual financial reports)
The Motley Fool: Finance and Folly -(a very good investing web
site)
-
NETworth
-
New York Stock Exchange Home Page
-
Securities Class Action Clearinghouse
-
Security APL Quote Server
-
StockMaster.com
Internet Essentials 99
Newsletter for the financial professional
-
The American Stock Exchange - The Smarter
Place to Be
-
The Chicago Mercantile Exchange--The
Exchange of Ideas
-
The Inc. 500 (Fast Growing Companies)
-
HomeArts: Money Minded (Investment
Services for Woment)
-
The Nasdaq Stock Market Home Page -
Reload Often
-
Yahoo! - Business
and Economy:Indices
-
Yahoo! - Business
and Economy:Markets and Investments
-
Yahoo! Quotes
NationMaster ---
http://www.nationmaster.com/index.php
- CIA World FactBook ---
https://www.cia.gov/cia/publications/factbook/index.html
A great resource site for finance, investing, world news, and accounting
CBS Market Watch (includes a glossary) ---
http://cbs.marketwatch.com/news/default.asp?siteid=mkt
One opinion on the top 10 investment
resource sites.
InvestMove.com --- www.investmove.com
Wall Street Journal
-
Home Page
-
MONEY & INVESTING UPDATE -- Front
Page
-
Technology in Education -- Table of
Contents
-
Wall Street Journal (Personal Technology Column)
-
Wall Street Journal Interactive Edition
A new Wall Street Journal service:
The Wall Street Journal has made some
important changes to its online center for entrepreneurs, formerly
known as startup.wsj.com.
Now called StartupJournal.com, this newly
redesigned site offers you an enhanced collection of information
that's focused on buying or starting a business or franchise.
Among the changes you'll see:
==Improved Navigation== It's more efficient
than ever to find what you're looking for on StartupJournal.com. Our
new, subject-based tabs organize information into useful categories
such as Columnists, Financing, Technology, Franchising and Ideas.
http://StartupJournal.com
Advanced Stock Information
http://www.stockadvanced.com/
(note that ratios are available)
Enter a symbol and click "go!" to get the
following information: Stock Prices, Options, Stock Splits, Charts, Live Stock
Quotes, Stock Performance, Earnings Estimates, Analyst Opinions, Company
Performance, Stock Valuation, Broker Reports, Company Profile, Earnings Release
Dates, Latest News, Fundamentals, Intraday Charts, Forum Discussions, Technical
Charts, Annual Reports, Significant Events, Institutional Ownership, Financial
Ratios, Insider Trading, SEC Filings, Financial Statements, Stock Dividends,
Competition, Momentum Rating, Management Discussion, Conference Calls, Short
Interest, and more.
eFinancial News
http://www.efinancialnews.com/
-
- Foreign Currency FX Converter --- http://www.xe.com/ucc/
Live Currency Converter ---
http://www.livecurrencyconverter.com/
Also see
http://www.oanda.com/currency/converter/
-
- From the Scout Report
Global Financial Data [.pdf]
http://www.globalfindata.com/
This impressive collection of historical global
financial data stretches from the years 1264 to 2000. While most of the
actual data must be purchased, this Website does offer several free
series, including Stock Markets since 1693, Interest Rates since 1700,
and Inflation Rates since 1264. The site also contains a decent-sized
collection of research papers written about the Eurodollar and a links
page with financial Websites from around the world.
Links to the Top Five Personal Finance Web Sites:
http://www.tiac.net/users/nhannon/finance_personal.htm
Also see the CFO Magazine Online
http://www.cfonet.com/
An interesting personal finance web site (among the
thousands available) is at
http://www.cncurrency.com
Not much in the way of ratio data at that web site, but you will find a variety of
interesting documents and links.
100 Events That Shaped a Century
http://www.thestreet.com/basics/countdown/748433.html
The Basics of Business History
http://www.thestreet.com/basics/countdown/748433.html
Museum of American Finance ---
http://www.financialhistory.org/
Also see the Museum of American Financial History
http://www.financialhistory.org/
Stock Market Data ---
http://www.eoddata.com/
Gold : prices, facts, figures & research
---
http://www.galmarley.com/framesets/fs_monetary_history_faqs.htm
Barron's Rankings of
Websites
for Investors
"Despite a tough environment, the best Websites for
investors get even better," by Kathy Yakal, Barron's,
October 19, Page 1 ---
http://online.wsj.com/barrons/barrons_cover
Your Internet investments may have shriveled and died,
but investment Websites are more robust than ever. The bursting of the Internet
bubble and collapse of online advertising has culled the herd of investment
sites. Some surviving sites have added premium services to bring more dollars
in, but a surprising number of very good ones remain free. Even in these tough
times for all media, the top Websites have been honed and improved, and that's
about the best news online investors have had this year.
Before delving into the particulars, a
bit of disclosure: This year for the first time, we ranked two
sites operated by our corporate cousins, the Wall Street Journal
and SmartMoney. The Journal and Barron's are owned by Dow Jones;
SmartMoney is a joint venture between Dow Jones and Hearst. We
haven't done so in the past to avoid the appearance of any
conflict of interest, but to continue to omit them would make
our ranking of the Best Websites for Investors a misnomer. If
this decision brings the wrath of self-important journalism
reviews upon our heads, so be it. We think it best serves you,
the readers.
Back to the rankings. We use the same
system as the Electronic Investor column, grading based sites
only on areas applicable to them. For instance, judging a
charting site by its news and analysis would be like looking at
a relief pitcher's batting average. In that case, we gave them a
Not Applicable, and averaged the relevant scores out. All of the
winners' Web addresses are listed in the accompanying tables.
Here, then, is the Best
of the Web for 2002.
BONDS
Yahoo
Bond Center
Briefing.com
(Honorable Mention)
With stocks set to rack
up their third losing year, and cash equivalents paying yields
not visible to the naked eye, investors rediscovered bonds this
year. When looking at bond sites, we sought educational
information and commentary, current rates, and effective tools.
Yahoo Bond Center was our
overall favorite. It had the clearest opening screen, showing at
a glance what's offered. You can get the latest composite rates
on U.S. Treasury, municipal, and corporate bonds. News and
analysis are featured. There also are numerous tools, including
a bond screener and calculators. Links to Yahoo's bond message
boards help you learn what other people are thinking and post
ideas of your own. An educational section pulls informative
articles from other top sites, and a glossary also helps you
learn.
The supplier of Yahoo's
bond commentary came from our Honorable Mention in this
category, Briefing.com. To get most of the skinny on bonds,
you'll have to subscribe at Briefing.com's Professional level,
at $25 a month, though the site's free services offers bond
coverage three times a day. Professional subscribers get live
bond coverage and briefs as news breaks, as well as bond quotes.
Tools are in short supply at this site, as are educational
tools, but Briefing.com's live commentary is worth it for the
serious follower of bonds.
CHAT AND
MESSAGE BOARDS
Silicon
Investor
Some good advice and
access to breaking news can come from fellow investors, on chat
and message boards. The problem is knowing how credible the
source is, which is why we recommend you never take something
you read on a board as gospel. But these virtual conversations
can serve as springboards to your own further research.
Message boards are
generally more reliable than live chat, and also contain more
serious content with less inane chatter. Our favorite once again
is one of the oldest, Silicon Investor, which still hosts some
of the most serious investment conversations. The site's opening
Stocktalk page displays a list of subject categories; click on
one and you can drill down to find related discussion threads.
You can also get a list of new subjects and hot subjects, and
view messages in threads and from people you designate. And of
course, you can search using your own keywords.
We didn't pick a favorite
chat room, since no one excels in all areas, though there are
several that we'd recommend. AvidTrader aimed at serious, active
traders, hosts a chat room as a part of its package of
investment research tools ($135 per quarter for each of two
channels; 50% off on the second if you buy both). Another site
that attracts intelligent, in-depth discussion is Financial
Chat's Active Trader room (www.financialchat.com),
which is free.
COMMENTARY
TheStreet.com
(tie)
Wall
Street Journal (tie)
Briefing.com
(Honorable Mention)
CBS
MarketWatch (Honorable Mention)
What do all the numbers
and news mean? We gave high marks to sites with regularly
updated commentary from folks who have been around the block a
few times.
Two sites got top scores
for different reasons: The Street.com and the Wall Street
Journal both have been around practically since the Web opened
its doors, and both sites scored a perfect four stars in this
category.
TheStreet.com posts
numerous analytical pieces every day from a large stable of
professional traders and journalists, including the ubiquitous
James Cramer. The site has three subscription levels. A
smattering of news and analysis and a palette of investing tools
are available free. A RealMoney subscription ($19.95 per month
or $199.95 annually, 30 days free) packs in more real-time
commentary and a columnist message board. RealMoney Pro, geared
towards professionals, is $250 monthly or $2,200 annually, with
two weeks free.
The Wall Street Journal
has its own impressive slate of contributors who weigh in on a
variety of financial and market topics. Your best bet is to
click the Columnists link on the opening page to see who's
covering what beat. For $79 ($39 for Journal or Barron's
print subscribers), you get a year's access to the Wall Street
Journal and Barron's Online.
Briefing.com isn't as
slick, but its writers and analysts break in frequently
throughout the day with terse comments to market events,
including those in the credit and currency markets. Some live
coverage is free, and the $9.95 a month subscription level
provides more commentary and news, with the $25 a month level
best for the pro.
CBS MarketWatch has the
advantage of being free, but it can't quite match the depth of
commentary of our two winners. Daily specialty columns cover
topics like the Internet, market analysis, and the tech sector.
COMPANY
RESEARCH
Multex
Investor
Hoover's
(Honorable Mention)
If more investors (and
analysts) slogged through dry reports and company fundamentals,
we wouldn't be in the fix we're in. We looked for sites that
provided easy access to the nuts-and-bolts numbers investors
need with a bucket load of reports available from a variety of
sources, free and for fees.
The winner again is
Multex Investor. Aside from pop-up ads at every turn, we had few
complaints. Enter a ticker symbol or company name, and links
take you to myriad pieces of the company's picture, ranging from
expanded quotes and charts to earnings estimates to income
statement/balance sheet/cash flow. Many other mini-reports are
available, on topics such as insider trading, institutional
ownership, and significant developments. Additional research
reports by major firms are also available, mostly for a price.
Hoover's is a close
second. You can get some company information free here,
including abbreviated financials, annual reports, SEC filings
and company press releases. Reports can be purchased. More
in-depth company information is available by subscription.
Hoover's Lite costs $49.95 a month or $399 a year, and
Professional subscriptions, which include things like multi-user
access, downloadable financials, contact information, and much
more company information begin at $1,995 a year.
For crucial Securities
and Exchange Commission filings, the best place to go is still
EDGAR
Online. The $14.95 monthly fee includes real-time access to
current filings, and 25 filings a month. Additional documents
are available at $2 each. If you need basic fundamentals in
real-time, there are many places to go. We like
Money.net.
Its streaming real-time quote system ($14.95 a month) lets you
track up to 500 stocks simultaneously, with 38 data columns.
ECONOMIC DATA
Economy.com
Economist.com
(Honorable Mention)
We looked at sites that
provided access to raw data, general economic news worldwide,
and commentary to interpret it all.
The winner again is the
network of sites located at www.economy.com.
This site and its subsidiaries provide a massive amount of
information. But it doesn't all come cheap; many reports cost
hundreds of dollars. The Dismal Scientist (www.dismal.com),
one of its subsites, is more affordable --$16.95 a month or $159
a year. It provides news, commentary, data, and tools covering
over 100 economic indicators in 15 countries. Its FreeLunch site
lets you search for over 900,000 economic and financial data
series, gratis.
Honorable mention here
goes to the Economist's Website. Much of the site's national and
international content is free; premium content costs $19.95 a
month or $69 a year. Premium subscribers get access to The
Economist before it hits the newsstands, and to archives going
back to 1997.
EDUCATION
The
Motley Fool
SIA
Investor (Honorable Mention)
Two sites rose to the
top. The Motley Fool, which has focused on educating investors
from the beginning of its long life on the Web, is our overall
favorite. All the educational information and tools are easily
accessible from one section of this supersite, the Fool's
School. Two core sections offer most of the site's teachings:
the founders' 13 steps to investing, and a guide to several
elements of market education.
SIA Investor, a service
of the Securities Industry Association, takes advantage of the
long-time involvement of many experts. Special sections cover
specific topics like managing your retirement nest egg. A
dictionary of financial terms and tools and other interactive
features make this site a good starting point for new investors,
as well as more seasoned ones.
Two other sites are worth
checking out. The American Association of Individual Investors,
which requires a subscription to get access to all of its
editorial content ($49, or $79 for the enhanced membership),
offers publications as well as online tutorials covering issues
like mutual funds, stocks and portfolio management. The SEC site
has a haven for new and seasoned investors (www.sec.gov/investor.shtml).
Rather than a primer on investing basics, this subsite provides
education on how to protect yourself as an investor.
FINANCIAL NEWS
Wall
Street Journal
CBS
MarketWatch (Honorable Mention)
Yahoo
Finance (Honorable Mention)
Almost every investment
Website offers financial news. The more the better, but we also
looked at the quality of that reporting.
The Wall Street Journal
does the best job overall of covering U.S. and global financial
events in depth. Links on the opening page take you to news by
region and topic. Much of the financial news can be found under
the Markets and Your Money links.
CBS MarketWatch also does
a great job of posting voluminous financial news quickly and
accessibly and garners an Honorable Mention this year. The site
has its own reporting staff, so stories sometimes fly fast and
furiously on turbulent days. You can also browse through stories
provided by major news services and recent press releases. Speed
and the volume of stories set CBS MarketWatch apart.
We also gave Honorable
Mention to Yahoo Finance for pulling together some of the best
financial news content on the Web and making it easy to find.
Click the Financial News link on the opening page for headlines
from AP, CBS MarketWatch, Financial Times, and Investor's
Business Daily.
You can also go to the
horse's mouth -- PR Newswire and Business Wire --for press
releases as they're available.
GLOBAL MARKETS
Financial
Times (tie)
Wall
Street Journal (tie)
The Financial Times was
recently awarded four stars by the Electronic Investor, and it
shares top honors with the Wall Street Journal. The site is
beautifully designed, and it's easy to find what you're looking
for at a glance. Major news is displayed up top, followed by
links to commentary and links to additional world market news.
Most content is free, but premium subscriptions give you access
to exclusive news and commentary, industry-specific analysis and
reports, in-depth data on more than 18,000 listed companies, a
world press monitor, and more (two subscription levels: $95 and
$225 a year).
Not surprisingly, the
Wall Street Journal scored equally well. Links on the opening
page take you to a region's page, like the Americas, Europe, and
Asia. Sublinks on each region's page take you to the news page
for each country covered within that region. Market data is
available for countries covered.
MUTUAL FUNDS
Morningstar
You'll find lots of help
with mutual funds on the Web. Many general-interest sites have
sections devoted to funds, and many of them license information
from our four-star winner, Morningstar. Its QuickTake reports
are about the most effective use of space we've seen on the Web;
you get a one-page rundown on each mutual fund. More in-depth
research is available, including analyst reports and Morningstar
ratings. Tools are plentiful. A premium membership, which
includes features like portfolio optimization, reports, and
alerts, costs $11.95 a month or $109 a year.
SmartMoney has some
unusual tools to help you get a handle on the mutual fund
market. The Fund Map 1000 provides a graphical representation of
the 1,000 most important mutual funds, color-coded to indicate
fund performance. And for easy, accessible fund research, check
out CNBC on MSN Money or Quicken.com.
PORTFOLIO
TRACKERS
CNBC
on MSN Money
SmartMoney
(Honorable Mention)
Even if you're using a
desktop portfolio - tracking system, you probably want to have a
home for your portfolio on the Web, for quick updates during the
day. In this category, we looked for sites that gave us the most
options and information.
CNBC on MSN Money again
tops this category. Its portfolio tracker's clean display makes
it easy to find the tools you need. You can enter your holdings
on a simple screen, or import data from desktop Quicken or
Money, the Yahoo Website, or some brokers. MSN's portfolio
tracker really shines when it comes to setting your own
criteria. Click on a security and drop down the Analysis menu,
and you have easy access to pertinent data, like a snapshot,
historical chart, recent news, and analyst information.
A close second was
SmartMoney's portfolio tracker. Like MSN's, it's heavy on
analysis tools. You can see an overview and performance chart,
view a visual map and analysis using several factors, and check
out your portfolio's allocation.
SCREENING TOOLS
CNBC
on MSN Money
SmartMoney
(tie)
Wall
Street City (Honorable Mention)
A staple of many major
and minor investment Websites, securities screeners let you
select from numerous parameters or use prefab screens. As
always, too, we considered the way the tools and results were
presented.
CNBC on MSN Money was one
of our top two here. The stock screener lets you build your own
searches, selecting from many dozens of variables. The resulting
list contains links to more information about each company.
Mutual fund screeners work much the same, only with fewer
building tools.
SmartMoney's securities
screeners work similarly, letting you select from variables in
categories like Price/Price Changes/Volume, Ownership,
Historical Growth, and Margins, and assign operators and values.
Several prefab screens including Bottom Fishing, Insider Buying,
and Profitability do some of the work for you, and a heat map
displays the 1000 least risky stocks.
Next, by a nose, is Wall
Street City. Screening variables are quite versatile and allow
for very complex searches, and prefab screens give you
insightful looks into related subgroups of the market for $9.95
a month.
Also worth a look:b4utrade
offers standard screening tools, but also lets you sift through
very time-sensitive parameters, like stocks on the move today.
Cost: $25 a month. Check out Stockworm,
too, one of the most skillfully designed sites we've ever seen.
Part of its $15 per month subscriber fee pays for access to
several screening tools ranging from very simple to moderately
complex.
SUPERSITES
Yahoo
Finance
CNBC
on MSN Money (Honorable Mention)
SmartMoney
(Honorable Mention)
Last year, we expanded
beyond just ranking supersites on the theory you could readily
bookmark where you wanted to go for bonds, screening, news and
so forth. Still, we look at omnibus sites that aim to provide
all your investment information needs.
This year, Yahoo Finance
takes the crown as the best overall site, moving ahead of
MSN-related sites for the first time since we began ranking
them. Yahoo's text-based interface makes navigation simple and
fast. The opening page provides a brief market update and easy
access to all of the site's content. Links take you to more
in-depth market updates and news from respected outlets like
Briefing.com, Business Week and Financial Times. The Stock
Research link takes you to an exceptional collection of research
tools covering stocks, mutual funds, options and bonds. Tools
include screeners and a portfolio, with the option of real-time
streaming data ($9.95 a month). International news is also
available as are message boards and chat rooms. You may never
need to go elsewhere.
CNBC on MSN Money gets an
Honorable Mention this year. The site's slick, easily navigable
interface helps simplify your investing chores. With the top
screener and portfolio tracker, it also excels at original
editorial content and stock ratings.
SmartMoney also receives
an Honorable Mention. As with MSN Money, tools like its
portfolio tracker and screeners help move it ahead of the pack.
Its market maps give you a little different perspective on
what's happening. Bond coverage is exceptional, as is its
educational content.
When we only ranked
supersites, several sites earned top honors, and remain
excellent places to retrieve your market information though they
don't excel in one particular area. AOL Personal Finance (on the
proprietary service) and Quicken.com,
for example, still rank high in all categories. Quicken has even
added integrated brokerage services to its site this year.
CNNMoney (money.cnn.com)
is a great place for breaking and in-depth news, as well as
investor tools and research. Lycos Finance (finance.lycos.com)
just added streaming live charts, with a streaming portfolio and
news, to its investment offerings. The Thomson Financial Network
(www.thomsonfn.com)
offers an effective blend of market news and research tools.
Accounting
News, Blogs, Tweets, etc. ---
http://faculty.trinity.edu/rjensen/AccountingNews.htm
TECH NEWS
C|NET
News
Wall
Street Journal (Honorable Mention)
Where once we looked for
tech stocks that would double and triple, now we're searching
for survivors.
C|NET News is still our
favorite. The site is good at breaking technology business news,
as well as covering events in the technology sector that may
eventually affect the market. And C|NET News gathers top tech
stories from other outlets on the Web and provides links.
Long before the Web, the
Wall Street Journal covered tech news thoroughly and continues
to do so. In-depth special reports have dealt recently with
stories like AOL's shakeup and WorldCom's fall.
Among other sites, The
San Jose Mercury News (www.siliconvalley.com),
reports on local Silicon Valley news, as well as the rest of the
tech industry. The New York Times (www.nytimes.com)
is also a good place to catch up on news and analysis. And
IDG.net is a compendium of content pulled from IDG's high-tech
publications.
TECHNICAL
ANALYSIS
Prophet.net
ClearStation
(Honorable Mention)
The Web is rife with
chart-making tools. Many sites provide simple chart builders as
a part of their research packages, but to do serious technical
analysis, you'll have to visit a site that specializes in
providing sophisticated tools for a variety of indicators.
We selected Prophet.net,
formerly Prophet Finance, as our top dog this year. The new site
is easier to navigate than before, and focuses on creating a
variety of charts. Several specialized charts are available,
offering up to 130 indicators and 40 years of historical data.
Three subscription levels are available: $9.95 a month for
delayed market data, $19.95 a month for real-time charts, and
$34.95 adds futures and options data in addition to other tools
for advanced traders. Limited tools are available free.
ClearStation gets our nod
for Honorable Mention this year. It takes a bit of study to
understand this site's methodology. Once you do, it's simple.
The site takes a three-pronged approach to investment research,
combining technical analysis, fundamentals, and community
sharing; one view on this site combines all three on the same
page, which is a great snapshot. All free.
Other sites handle
technical analysis admirably. One of
Decision
Point's claims to fame is that it provides investors with
pre-built charts and chart books for dozens of indexes and
market sectors and indicators, in addition to other specialized
charts. And BigCharts
still is one of the best places to go to build your own quick
charts.
A section on the ratings criteria is not included in the above quotation.
|
"Social Security: What’s the Magic Age? When to start collecting your
benefits," by Kathryn Garnett, Journal of Accountancy, July 2006 ---
http://www.aicpa.org/pubs/jofa/jul2006/garnett.htm
In determining the age
at which a worker should apply for Social Security benefits,
consideration should be given to current and expected future sources of
income, age of beneficiary and spouse, health issues that could affect
longevity and whether the beneficiary will continue to work while receiving
benefits.
There is no
“one-size-fits-all” answer for deciding when Social Security
benefits should be started. Many workers will benefit by beginning to
receive benefits at age 62 due to their circumstances and needs. For others,
waiting until full retirement age, or even later, will provide higher annual
income in the years ahead when their expenses might outpace their resources.
How long does it take
to break even in the game of taking benefits at early vs. normal
retirement age? If two retirees are now 65 and one started collecting Social
Security benefits at age 62 and the other starts now, they will collect the
same total amount of money when they are 77 years old.
It’s important to do
preretirement calculations at least every three years, to take into
account any changing circumstances and/or changes in the rules as they apply
to Social Security benefits, pensions and investment savings.
From Smart Stops on the Web,
Journal of
Accountancy, July 2006 ---
http://www.aicpa.org/pubs/jofa/jul2006/news_web.htm
RETIREMENT PLANNING
SITES
Green Golden Years
http://retireplan.about.com
CPA/PFSs can find retirement planning advice here, including information
on rolling over qualified plans, an IRA fact sheet and five reasons to
open a 401(k) plan. Take a quiz to see how much you know about the
basics of retirement planning, calculate 401(k) plan savings or sign up
for a free newsletter.Wealth of Resources
www.fpanet.org
Free registration at the Financial Planning Association Web site gets
planners access to a calculator that can figure the worth of your
client’s 401(k) at retirement. Find checklists on the documentation you
should ask clients to supply to begin working with them and questions
they may ask about your qualifications. Take an investment fraud
awareness quiz or research what to do with your retirement plan if you
lose your job.
Ready to Retire?
www.theretirementpros.com
Read detailed Qs&As on retirement planning in the Ask the Experts
section at this e-stop to find out whether your clients are set for
their futures. Topics include annuities, general investing, Medicaid and
Social Security. Access calculators to figure out how much savings your
clients will need in order to quit working. Compare taxable and tax-free
investment returns and inflation’s impact on savings, get the free Primer on Annuities report or register for free Webinars and the
Safe Money Advisory newsletter.
Older and WISER
www.wiser.heinz.org
The Women’s Institute for a Secure Retirement (WISER) Web site offers
five things women need to do for retirement, as well as five reasons
retirement is a challenge for female workers. You can find 10 ways baby
boomer women can avoid retirement poverty, read up on issues related to
retirement plans, such as divorce and widowhood, or see how well you do
on a pension checklist.
Retirement Resources
www.wealthygeek.com
Don’t let the tongue-in-cheek Web address fool you: CPAs looking for
pertinent information on retirement planning for themselves and their
clients will find it here. Links take users to Q&A discussions on
factors affecting 401(k) plans, such as active vs. passive plan
management and when payments kick in and tips on how to manage
investment losses.
Compare Alternative Credit Card Deals
December 16, 2008 message from Ashley Turner
[ashleyturns@gmail.com]
Hi Bob!
I stumbled upon your site
looking for finance resources--I recently graduated
college and am just starting to stand on my own feet
financially. This is also my first year that I'll be
paying taxes, so all your IRS info was especially
appreciated! I actually wanted to suggest a site
that your readers might be helpful: I've been
consulting bankaholic.com quite a bit, and I've
found their information to be quite good. I've read
their section on comparing credit cards over and
over again! Just a thought!
Take care,
Ashley T.
Bankaholic.com ---
http://www.bankaholic.com/
Bob Jensen's threads on the dirty secrets of
credit card companies are at
http://faculty.trinity.edu/rjensen/FraudReporting.htm#FICO
-
Intertops Home Page
(Gambline, Austria)
-
-
Accounting,
Finance and Business Glossaries
Center for Financial Research & Analysis,
Inc.
CFRA, Inc. Launches Free On-Line Service for
Academic Community
Rockville, MD - August 1 - The Center for
Financial Research & Analysis (CFRA, Inc.), a leading provider of
independent research to over 2,000 institutional investors, will now offer
an academic version of its product to professors and their students. Since
there is no cost for this service, its use is restricted for research and
teaching purposes.
What's included with the Academic Version?
1. Access to all educational pieces in our
database. 2. Access to selected company-specific reports that focus on
quality of earnings issues 3. Weekly e-mail notification of new companies
added to the database
Who qualifies for this service and how can you
sign up?
All professors teaching courses in financial
accounting, auditing, and finance qualify. To sign up, click on the URL
http://www.cfraonline.com
and register. Then sign and fax the agreement to (301) 984 8617. Once
activated, you will have access to the Academic Version of CFRA's
database.
About CFRA
CFRA has become known internationally for its
pioneering research ferreting out companies with operational problems that
use unusual accounting practices to camouflage such practices. Founded in
1994 by Dr. Howard M. Schilit following a 20 year career as an accounting
professor (author of FINANCIAL SHENANIGANS: How to Detect Accounting
Gimmicks and Fraud in Financial Reports)
http://www.cfraonline.com/publications/publications.jsp#FinancialShenanigans
CFRA provides a daily on-line news wire of financial analysis and a
database on over 900 companies. Its mission is to warn investors and
creditors about companies experiencing operational problems and
particularly those that employ unusual or aggressive accounting practices
to camouflage such problems.
Howard Schilit
http://www.cfraonline.com
301-984-1001 ext. 105
-
Everyone is entitled to their own opinion, but not their own facts.
Senator Daniel Patrick Moynihan --- FactCheck.org
---
http://www.factcheck.org/
Data.gov (a place to start for downloading
government data) ---
https://www.data.gov
National Center for Education Statistics
---
http://nces.ed.gov/
Public.Resource.Org ---
http://public.resource.org/
Our World in Data (many graphics and links to databases)
---
https://ourworldindata.org
Health Statistics ---
http://faculty.trinity.edu/rjensen/Health.htm#Introduction
Fact Sheet About USA Schools in 2018 ---
https://www.edweek.org/ew/issues/education-statistics/index.html?cmp=eml-enl-eu-news1&M=58712887&U=2290378&UUID=b16c6f948f297f77432f990d4411617f
World Wealth & Income Database ---
http://wid.world/
OECD Health Statistics 2016 ---
http://www.oecd.org/els/health-systems/health-data.htm
Facts and statistics (Fast Facts) --- http://gwu.edu/~gprice/handbook.htm
Bob Jensen's World Library ---
http://faculty.trinity.edu/rjensen/Bookbob2.htm
Data Africa ---
https://dataafrica.io/
Bob Jensen's threads on medicine ---
http://faculty.trinity.edu/rjensen/bookbob2-Part2.htm#Medicine
World Health Organization: World Health
Statistics 2015 ---
http://www.who.int/gho/publications/world_health_statistics/2015/en/
Global Open Data Index (database for governments
across the globe) ---
https://index.okfn.org
Updates from WebMD ---
http://www.webmd.com/
Global Open Data Index (international government
data) ---
http://index.okfn.org
National Crash Analysis Center ---
http://www.ncac.gwu.edu
The Magazine of Early American Datasets ---
http://repository.upenn.edu/mead
Crime in the United States: 2013 ---
https://www.fbi.gov/about-us/cjis/ucr/crime-in-the-u.s/2013/crime-in-the-u.s.-2013
Crime Solutions ---
http://www.crimesolutions.gov/
County Populations (and how they changed in the USA over
time) ---
http://creatingdata.us/testing/county_populations/
Demographics of Inequality in the USA ---
http://www.ssa.gov/policy/docs/ssb/v64n4/v64n4p1.html
Somewhat dated but still revealing
in terms of racial disparities
Racial and Ethnic Differences in Wealth and Asset Choices
Sharmila Choudhury
Social Security Bulletin, Vol. 64 No. 4, 2001/2002
Quandl: over 8
million demographic, economic, and financial datasets from 100s
of global sources ---
http://www.quandl.com/
Jim Martin's listing of economic indicators on MAAW ---
http://maaw.info/EconomicIndicators.htm
From Mike Kearl
Need to find out what a dollar in 1917 is worth in
2007? Examine postwar inflation rates in transportation rates in the South?
Take advantage of the U.S. Bureau of Labor Statistics
Consumer Price
Indices or EH.NET's "How
Much Is That" websites. (For British conversions from 1264 to 2002,
click here.) Speaking of
conversions, there are 8,100 conversions and calculators at
Online
Conversion.com--"Convert just about Anything to Anything else."
More data links ---
http://www.trinity.edu/mkearl/data.html
From EDGAR Online
FREE
access to the latest
ANNUAL REPORTS and
PROSPECTUSES from hundreds of publicly traded companies and funds.
FREE access to ANNUAL REPORTS in XBRL ---
http://faculty.trinity.edu/rjensen/XBRLandOLAP.htm#TimelineXBRL
From EDGAR Online ---
http://www.tryxbrl.org/
Tax Foundation Facts & Figures (Free) ---
http://taxfoundation.org/files/ff2012.pdf
Career Guide to Industries -- Bureau of Labor
Statistics ---
http://www.bls.gov/oco/cg/
Accountants and Auditors ---
http://www.bls.gov/oco/ocos001.htm
World Clock and World Facts ---
http://www.poodwaddle.com/worldclock.swf
Smithsonian Research Online ---
http://research.si.edu/
Prologue Magazine (USA Government Records) ---
https://www.archives.gov/publications/prologue/
CDC Blogs ---
http://blogs.cdc.gov/
Finding and Using Health Statistics ---
http://www.nlm.nih.gov/nichsr/usestats/index.htm
Beyond the Numbers (from the Bureau of Labor Statistics) ---
http://www.bls.gov/opub/btn/
Gender Equality Data and Statistics ---
http://datatopics.worldbank.org/gender/
LIS Cross-National Data Center in Luxemourg ---
http://www.lisdatacenter.org
-
- Free online economics, finance, accounting, and statistics books ---
http://faculty.trinity.edu/rjensen/ElectronicLiterature.htm#Textbooks
Foreign Currency FX
Converter ---
http://www.xe.com/ucc/
Live Currency Converter ---
http://www.livecurrencyconverter.com/
Federal Reserve Bank of New York: Data and Indicators ---
http://www.newyorkfed.org/research/data_indicators/
Bob Jensen's threads on economic statistics ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#EconStatistics
Housing: Spotlight on Statistics ---
http://www.bls.gov/spotlight/2014/housing/home.htm
U.S. Energy ---
http://www.eia.gov/state/?sid=US
OECD Factbook eXplorer ---
http://stats.oecd.org/oecdfactbook/
United Nations Economic Commission for Europe:
Statistical Database ---
http://w3.unece.org/pxweb/Dialog/
Money Matters (international economic data) ---
http://www.imf.org/external/np/exr/center/mm/eng/mm_cc_01.htm
Carnegie Foundation for the Advancement of Teaching:
Statway [education statistics] ---
http://www.carnegiefoundation.org/statway
EconStats ---
http://www.econstats.com/index.htm
Federal Revenue and Spending Book of Charts (Great Charts
on Bad Budgeting) ---
http://www.heritage.org/research/features/BudgetChartBook/index.html
World Health Organization: Health Economics ---
http://www.who.int/topics/health_economics/en/
OECD Factblog ---
https://community.oecd.org/community/factblog?view=overview
OECD Factbook eXplorer ---
http://stats.oecd.org/oecdfactbook/
Education Today: The OECD Perspective ---
http://www.oecd.org/document/57/0,3343,en_2649_33723_42440761_1_1_1_1,00.html
Public.Resource.Org ---
http://public.resource.org/
Bureau of Land Management: Public Land Statistics ---
http://www.blm.gov/public_land_statistics/index.htm
Economic Indicators ---
http://www.gpoaccess.gov/indicators/
HUD User [Housing Data] ---
http://www.huduser.org/portal/index.html
Education statistics ---
http://faculty.trinity.edu/rjensen/Bookbob2.htm#050421Statistics
Global Education Digest 2007 ---
http://www.uis.unesco.org/ev.php?ID=7002_201&ID2=DO_TOPIC
Global Health Reporting ---
http://globalhealthreporting.org/
Governing Sourcebook ---
http://sourcebook.governing.com/
Marginal Tax Rates ---
http://www.econlib.org/library/Enc/MarginalTaxRates.html
Sourcebook of Criminal Justice Statistics Online ---
http://www.albany.edu/sourcebook/
National Criminal Justice Reference Service ---
http://www.ncjrs.gov/
Getting Current: Recent Demographic Trends in Metropolitan America ---
Click Here
http://www.brookings.edu/~/media/Files/rc/reports/2009/03_metro_demographic_trends/03_metro_demographic_trends.pdf
Poverty rates in the U.S. are much lower since 1960 ---
http://sorrel.humboldt.edu/~economic/econ104/poverty/
And in the U.S., the poverty standard of living on average would
be considered luxury in most other parts of the world.
EUROPA: Key facts and figures about Europe and the Europeans ---
http://europa.eu/abc/keyfigures/index_en.htm
Not All Measures of GDP Are Created Equal ---
http://davegiles.blogspot.com/2016/12/not-all-measureds-of-gdp-are-created.html
Immigration Since 1840 Social studies dp.la/browse-by-topic/immigration-since-1840
---
https://dp.la/browse-by-topic/immigration-since-1840
Small Business Administration information services guides
Business.gov ---
http://www.business.gov/
Bob Jensen's small business helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#SmallBusiness
The Google Stock Screener (sort of nice as online
screeners go) ---
Click Here
UNdata ---
http://data.un.org/
Some links I carry permanently on my homepage:
World Clock ---
http://www.peterussell.com/Odds/WorldClock.php
Facts about the earth in real time ---
http://www.worldometers.info/
Interesting Online Clock and
Calendar ---
http://home.tiscali.nl/annejan/swf/timeline.swf
Time by Time Zones ---
http://timeticker.com/
Projected Population Growth (it's out of control) ---
http://geography.about.com/od/obtainpopulationdata/a/worldpopulation.htm
Also see
http://users.rcn.com/jkimball.ma.ultranet/BiologyPages/P/Populations.html
Projected U.S. Population Growth ---
http://www.carryingcapacity.org/projections75.html
Real time meter of the U.S. cost of the war in Iraq ---
http://www.costofwar.com/
Sure wish there'd be a little good news today.
-
- Enter you zip code to get Census Bureau comparisons ---
http://zipskinny.com/
-
- FirstGov ---
http://www.fedworld.gov/firstgov.html
-
EUROPA: Key facts and figures about Europe and the Europeans ---
http://europa.eu/abc/keyfigures/index_en.htm
Bob Jensen's links to social science tutorials ---
http://faculty.trinity.edu/rjensen/Bookbob2.htm#Social
AgeSource/AgeStats Worldwide ---
http://www.aarpinternational.org/database/
- U.S. Department of Labor's Bureau of Labor Statistics ---
http://www.bls.gov/
-
- CIA: The World Factbook 2005
http://www.cia.gov/cia/publications/factbook/index.html
Immigration by the Numbers (Video) ---
http://video.google.com/videoplay?docid=4094926727128068265&pr=goog-sl
U.S. Census Bureau: Longitudinal
Employer-Household Dynamics ---
http://lehd.did.census.gov/led/index.html
- U.S. Census Bureau: Random Samplings ---
http://blogs.census.gov/
-
- Bob Jensen's bookmarks for encyclopedias etc. are at
http://faculty.trinity.edu/rjensen/bookbob3.htm#Dictionaries
-
- Management Accounting Information Center ---
http://www.informationforaccountants.com/econstatsites.html
-
- The Deal: A top source for current financial news ---
http://www.thedeal.com/NASApp/cs/CS?pagename=Home&c=Page&cid=1011714706980
-
- Free Citizen Information Center ---
http://www.pueblo.gsa.gov/
This site has a lot of consumer
information and steers you through government
bureaucracy
-
-
University of Alaska Anchorage Institute of Social and Economic Research ---
http://www.iser.uaa.alaska.edu/
-
-
Chronicle of Higher
Education's 2008-2009 Almanac ---
http://chronicle.com/free/almanac/2008/?utm_source=at&utm_medium=en
Bob Jensen's threads on higher education
controversies ---
http://faculty.trinity.edu/rjensen/HigherEdControversies.htm
-
"Government posting wealth of data to Internet," by Pete Yost, The
Washington Post, January 22, 2010 ---
http://www.washingtonpost.com/wp-dyn/content/article/2010/01/22/AR2010012200768.html?wpisrc=nl_pmtech
The Obama
administration on Friday is posting to the
Internet a wealth of government data from all
Cabinet-level departments, on topics ranging
from child car seats to Medicare services.
The mountain of newly
available information comes a year and a day
after President Barack Obama promised on his
first full day on the job an open, transparent
government.
Under a Dec. 8 White
House directive, each department must post
online at least three collections of
"high-value" government data that never have
been previously disclosed.
The Transportation
Department will post ratings for 2,400 lines of
tires for consumer safety based on tire tread
wear, traction performance and temperature
resistance. The Labor Department will release
the names of 80,000 workplaces where injuries
and illness have occurred over the past 10
years.
The Medicare database
has previously been available for a fee of $100
on CD ROM. Under the Obama initiative, it can be
downloaded free, providing detailed breakdowns
of payments for Medicare services. The Medicare
data will be sortable by the type of medical
service provided.
A National Highway
Traffic Safety Administration database rates car
seats for ease of use, evaluating the simplicity
of instruction sheets, labels, vehicle
installation features and securing the child.
"We're democratizing
data," White House Chief Information Officer
Vivek Kundra said Thursday in an interview.
Open government groups
are supportive.
"There's recognition
that public equals online," said Ellen Miller,
executive director at Sunlight Foundation, a
nonprofit group focusing on the use of
technology for greater government transparency.
Miller said the effort
represents "a sea change in government's
attitude," with newfound support for the idea
that government data belongs in the hands of
citizens instead of locked away in the basement
of a federal agency.
All the new data
collections will be added to the government's
Web site, data.gov.
Required to release the
three new data sets are the departments of
State, Treasury, Defense, Justice, Interior,
Agriculture, Commerce, Labor, Health and Human
Services, Housing and Urban Development,
Transportation, Energy, Education, Veterans
Affairs, Homeland Security and the Environmental
Protection Agency, the offices of the U.S. Trade
Representative and the U.S. ambassador to the
United Nations and the Council of Economic
Advisers.
---
The directive ---:http://www.whitehouse.gov/omb/assets/memoranda-2010/m10-06.pdf
Government's Web site ---
http://www.data.gov/
Data Sets ---
http://www.data.gov/ogd
This included some data sets from the SEC
Jensen Comment
I think that many of our courses do not adequately
train students to use government Web sites in
general. The U.S. Government has done a magnificent
job for many years providing a wealth of data. How
many business school graduates know how to use the
Department of Commerce Website? The IRS tremendous
Website, the SEC enormous Website (beyond EDGAR),
etc?
When searching, how often do we click for Google
or Wikipedia when the best place to start might be a
Government Website or the UN Website.
UNdata ---
http://data.un.org/
Other data ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#EconStatistics
-
- Economic Indicators ---
http://www.economicindicators.gov/
-
- Pew Internet: Online Shopping Report ---
http://www.pewinternet.org/pdfs/PIP_Online
Shopping.pdf
-
- Economic Reviews ---
http://www.cepr.net/
-
- Brookings Institute ---
http://www.brookings.org/
- Annual Index of
Economic Freedom ---
http://www.heritage.org/index/
-
- Bureau of Justice Statistics ---
http://ojp.usdoj.gov/bjs/welcome.html
- Eurostat ---
http://epp.eurostat.ec.europa.eu/
-
- The knowledge economy of Europe ---
http://www.theworkfoundation.com/Assets/PDFs/KE_Europe.pdf
States in the U.S. Rated by Population and
Poverty ---
http://www.nccbuscc.org/cchd/povertyusa/map.htm
Putting Meat On The Table: Industrial Farm Animal
Production in America ---
http://www.pewtrusts.org/uploadedFiles/wwwpewtrustsorg/Reports/Industrial_Agriculture/PCIFAP_FINAL.pdf
Statistics: Cast Your Vote! ---
http://www.learner.org/interactives/statistics/index.html
OECD Statistics Portal ---
http://www.oecd.org/statsportal/0,2639,en_2825_293564_1_1_1_1_1,00.html
The World ---
http://www.theworld.org/
"Help Site for the Poor," Wired News, June 9, 2006 ---
http://www.wired.com/news/technology/0,71116-0.html?tw=wn_index_17
The site would provide information about
such basics as public safety, emergency services, education, health
care and jobs. U.S. Senators John McCain, an Arizona Republican, and
Barack Obama, an Illinois Democrat, serve as honorary co-chairmen of
the group.
Continued in article
The One Economy homepage is at
http://www.one-economy.com/
-
-
- National Debt Graph ---
http://zfacts.com/p/318.html
Graph of the Yearly U.S. Budget Deficit ---
http://www.uuforum.org/deficit.htm
-
"A Book for People Who Love Numbers," by Sam Roberts,
The New York
Times, February 22, 2006 ---
http://www.nytimes.com/2006/02/22/books/22stats.html
For starters, it weighs 29 pounds. It has
five volumes. And it's densely packed with more than a million
numbers that measure America in mind-boggling detail, from the
average annual precipitation in Sweet Springs, Mo., to the wholesale
price of rice in Charleston S.C., in 1707
Historical Statistics of the United States: Millennial
Edition, 5 Volume Set, Susan Carter (Editor), Michael R. Haines,
Scott Sigmund Gartner, Gavin Wright (Editor), Susan B. Carter
(Editor) ---
Click Here
-
-
-
October 13, 2006 message
from Dan Blystone (no relation to Trinity University's Bob Blystone)
Dear
Bob,
I am
writing to request that you kindly consider adding a link to my
website (TradersLog.com) on your page here:
http://faculty.trinity.edu/rjensen/bookbus.htm
I think
your visitors may find it useful and interesting, and it would
help my startup gain some valuable exposure.
The
website description is: Portal website for traders and investors
featuring articles, analysis and a community forum.
Please
let me know if you have any questions.
Best
Regards,
Dan
Blystone TradersLog.com (312) 593-1322
Reply from Bob
Jensen
Hi Dan,
I added
your message to
http://faculty.trinity.edu/rjensen/Bookbus.htm
However, I
think I have some better places to also add your message. It
will be in the forthcoming (October 31) edition of New
Bookmarks.
I have
added your link to my investor helper module at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#InvestmentHelpers
Since you
provide a great set of links to economic and financial
statistics, I also added your link at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#EconStatistics
Best of
luck in your venture.
Bob Jensen
|
-
Question
Where can you find facts about taxation?
October 7, 2007 message from JOHN STANCIL
[jstancil@VERIZON.NET]
I realize that the IRS is pretty tight with
its data, even in aggregated form. However, does anyone know if
there is an internet source where you can obtain certain tax facts –
such as the amount of charitable contributions claimed on individual
returns, the dollar amount of earned income credit, the amount of
productive activity deductions taken on a year to year basis?
Any help would be appreciated.
John Stancil
Florida Southern College
October 8, 2007 reply from Bob Jensen
When in doubt, always start with Wikipedia ---
http://en.wikipedia.org/wiki/Taxation
It goes without saying that you must be suspicious of questionable
items in any Wikipedia module. However, the above link is quite good
on this topic. As with most Wikipedia modules, both the Reference
(Notes) links and the Discussion sections are very important.
The Notes section (near the bottom) in this case leads to OECD
sites such as the National Accounts site ---
http://www.oecd.org/topicstatsportal/0,2647,en_2825_495684_1_1_1_1_1,00.html
The Discussion tab (near the top) leads to an extensive table of
contents of discussions.
Here are a few other sites to check out:
Bob Jensen’s statistical data links ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#EconStatistics
FirstGov ---
http://www.fedworld.gov/firstgov.html
Great IRS site links (not necessarily data table links):
The Individual Complete Report
Publication contains complete individual income tax data.
The statistics are based on a sample of individual income
tax returns, selected before audit, which represents a
population of Forms 1040, 1040A, and 1040EZ, including
electronic returns. ---
Click Here
FAQs and answers ---
http://www.irs.gov/faqs/index.html
Tax Fraud Alerts from the IRS ---
http://www.irs.gov/compliance/enforcement/article/0,,id=121259,00.html
Tax Scams ---
http://faculty.trinity.edu/rjensen/FraudReporting.htm#TaxScams
Bob Jensen's taxation helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
-
WSJ Video of the World Bank's Ranking of the Best and Worst Places to Do
Business ---
Click Here
Top Nations out of 178 Countries That Welcome Foreign Operations:
- Singapore
- New Zealand
- United States (would have been higher except for an
excessively complicated tax code better known as the CPA Full
Employment Act)
Low Ranking Countries Highlighted in the Videos:
- Argentina (113% corporate profit tax rate unless you cheat)
- Brazil (takes an average of 2,600 hours to fill in tax forms)
- Venezuela and Bolivia (cannot fire even the most lazy,
worthless, and drug addicted workers)
"Doing Business 2008: Making a Difference," International Finance
Corporation ---
http://ifc.org/ifcext/media.nsf/Content/Doing_Business_2008
-
-
- EconPhD ---
http://www.econphd.net/
Lecture notes, book notes. etc.
-
- Economic Statistics from the Dismal Scientist ---
http://www.economy.com/dismal/
Economagic (economic statistics) ---
http://www.economagic.com/
International Monetary Fund (economic history) ---
http://www.imf.org/external/np/exr/center/mm/eng/mm_cc_01.htm
Iraq Stock Exchange Registrants Must File
Financial Reports Under IFRS Accounting
We have created a new
Jurisdiction Page for Iraq.
Under the Iraq securities
markets law, all companies listed for trading on the
Iraq Stock Exchange
are required to publish financial statements that
are prepared in accordance with International
Financial Reporting Standards. Those statements must
be audited in accordance with International
Standards on Auditing. Further, the Iraq banking law
(administered by the
Central Bank of Iraq)
requires all banks to publish IFRS financial
statements. We have updated our table of
Use of IFRSs by Jurisdiction.
IASPlus blog from Deloitte, June 17, 2008 ---
http://www.iasplus.com/index.htm
Iran has some issues with IFRS convergence but is
at least considering the possibility of convergence,
unlike Saudi Arabia, Japan, and Iceland that appear
to be giving IFRS less consideration ---
http://www.iasplus.com/resource/gaap2002.pdf
Iran has an Institute of Certified Accountants
---
http://www.iasplus.com/index.htm
Professional Accountancy groups in other nations are
listed at
http://www.iasplus.com/links/links.htm
Many other useful accounting sites (scroll
down) ---
http://www.iasplus.com/links/links.htm
Deloitte also publishes an extensive Global
Outlook document, although I've not found updates
since 2006 ---
http://www.iasplus.com/resource/0511econoutlook2006.pdf
This is a very, very useful document about
global economic opportunities and risks.
- Directories ---
http://dir.yahoo.com/Business_and_Economy/Directories/
-
- What is the Consumer Price Index (CPI), including its components? ---
http://www.bls.gov/dolfaq/blsfaqtoc.htm
-
- Globastat: Country Rankings and World Statistics
http://Globastat.com/
-
- Fast Facts: Almanacs/Factbooks/Statistical Reports & Related
Reference Tools ---
http://www.freepint.com/gary/handbook.htm
-
- Explanations of economic
statistics can be found at EconDash.com
http://www.econdash.net/
-
- Clayton Solution Economic Indicators ---
http://www.econsources.com/EconSourcesEconomicIndicators.asp?PageID=2#
Economic Indicators ---
http://www.econsources.com/EconSourcesEconomicIndicators.asp?PageID=2
-
- Economy.com ---
http://www.economy.com/default.asp
-
-
How to Mislead With Statistics: The Consumer
Price Index
Moral Hazard ---
http://en.wikipedia.org/wiki/Moral_hazard
Consumer Price Index ---
http://en.wikipedia.org/wiki/Consumer_price_index
. . .
Confusion
It is apparent that much of
the muddle in discussing the merits of the different
approaches arises from the promiscuous mixing up of
arguments about feasibility, about dislike or
approval of the way the index would move under a
particular approach and about principles of various,
often incompatible, sorts. Feasibility is naturally
important. The difficulty of dealing with site
values is obvious.
Statisticians in a country
lacking a good dwelling price index (which is
required for all except the rental equivalent
method) will go along with a proposal to use such an
index only if they can obtain the necessary
additional resources that will enable them to
compile one. Even obtaining mortgage interest rate
data can be a major task in a country with a
multitude of mortgage lenders and many types of
mortgage. Dislike of the effect upon the behaviour
of the Consumer Price Index arising from the
adoption of some methods can be a powerful, if
sometimes unprincipled, argument.
Dwelling prices are
volatile and so, therefore, would be an index
incorporating the current value of a dwelling price
sub-index which, in some countries, would have a
large weight under the third approach. Furthermore,
the weight for owner-occupied dwellings could be
altered considerably when reweighting was
undertaken. (It could even become negative under the
alternative cost approach if weights were estimated
for a year during which house prices had been rising
steeply).
Then, there is the point
that a rise in interest rates designed to halt
inflation could paradoxically make inflation appear
higher if current interest rates showed up in the
index. Economists' principles are not acceptable to
all; nor is insistence upon consistency between the
treatment of owner-occupied dwellings and other
durables.
Clarity
Much would be gained if two
sets of problems were distinguished.*
What is the Consumer Price
Index to measure? How can that be achieved?
Another way of putting this
is to distinguish:
What is the question that
should be answered? This is a matter for policy
makers and other users of the Consumer Price Index.
How can it best be answered? This is a matter for
the statisticians.
The three approaches should
not be regarded as rivals, they are different
answers to different questions. One, or possibly
more, should be chosen. The three questions can be
formulated as follows:
Opportunity cost. What is
the change through time in what would be the
opportunity cost of the reference-period consumption
of the services of owner-occupied dwellings?
Spending. What is the change through time in the
cash outlays that would correspond to the
reference-period cash outlays in respect of
owner-occupied dwellings? Transactions. What is the
change through time in what would be the purchase
value of the reference-period net acquisition of
owner-occupied dwellings by consumers?
Which question is to be
answered is, as just stated, a policy matter,
depending upon the purposes the index is to serve.
It is not an issue for statisticians to decide.
Their job is the technical, professional one of
compiling one or more indexes that answer the
selected question or questions as well as possible,
given the resources at their disposal. In a perfect
world this is how the owner-occupied dwellings issue
would be resolved. But the world is not perfect
Continued in Article
No one really denies that
the CPI, as presently calculated, understates the rate
of inflation
Why the Consumer Price Index (CPI) is a Flawed Measure
of Cost of Living
It's largely due to moral hazard
caused by government's incentives to understate
inflation and cash flow increases in things like Social
Security
"Deconstructing ShadowStats. Why is it so
Loved by its Followers but Scorned by Economists?"
by Ed Dolan, Econ Monitor, March 31, 2015 ---
http://www.economonitor.com/dolanecon/2015/03/31/deconstructing-shadowstats-why-is-it-so-loved-by-its-followers-but-scorned-by-economists/
It is hard to think of a
website so loved by its followers and so scorned by
economists as John Williams’
ShadowStats, a widely
cited source of alternative economic data on
inflation and other economic indicators. Any econ
blogger who has ever written a line about inflation
is familiar with ShadowStats. Time and again,
readers cite it in comments, not infrequently
paranoid in their tone and rude in their language.
Brief replies that cast doubt on some of more
extreme claims made by ShadowStats fans don’t seem
to have much effect. After a
recent round of comments, I promised the editor
of one website to undertake a thorough
deconstruction of ShadownStats. Here is the result.
What ShadowStats
Gets Right: The CPI is a Flawed Measure of the Cost
of Living
ShadowStats is Williams’
attempt to provide an alternative to the official
consumer price index (CPI), which he views as a
flawed measure of what members of the general public
have in mind when they think of the cost of living.
Let me start by saying that although I share the
skepticism of many economists about the specific
numbers published on ShadowStats, I agree that the
official data do not tell the whole story. I support
Williams’ attempt to provide an alternative to the
official consumer price index that more closely
reflects pubic perceptions of inflation. Here,
in his own words,
is how Williams explains his
undertaing:
In the last 30 years, a
growing gap has been obvious between government
reporting of inflation, as measured by the
consumer price index (CPI), and the perceptions
of actual inflation held by the general public.
Anecdotal evidence and occasional surveys have
indicated that the general public believes
inflation is running well above official
reporting . . .
Measurement of consumer
inflation traditionally reflected assessing the
cost of maintaining a constant standard of
living, as measured by a fixed-basket of
goods. Maintaining a constant standard of
living, however, is a concept not popular in
current economic literature, and certainly not
within the thinking or the lexicon of the Bureau
of Labor Statistics (BLS), the government’s
statistical agency that estimates and reports on
consumer inflation. . . Individuals look to the
government’s CPI as a measure of the cost of
maintaining a constant standard of living, as
well as measuring that cost of living in terms
of out-of-pocket expenses. Without meeting
those parameters, an inflation measure has
limited, if any, use for an individual.
Williams is right about the
gap between public perceptions of inflation and
official indicators. As a recent series of posts on
inflation expectations on the Atlanta Fed’s
Macroblog noted,
“Inflation surveys of households reveal a remarkably
wide range of opinion on future inflation compared
to those of professional forecasters. Really, really
wide.” According to Macroblog, household
expectations of inflation for the coming year
consistently average two percentage points higher
than those of professional forecasters, and some 13
percent of household respondents report inflation
expectations of 10 percent or higher even at a time
when professional forecasts fall short of 2 percent.
In technical terminology,
we refer to a cost of living index based on the
changing cost of a fixed-proportion basket of goods
that themselves remain unchanged over time as a
Laspeyres index without quality adjustment.
Williams is again correct when he says that the
official CPI, following mainstream academic
thinking, has gradually evolved away from the
Laspeyres concept toward a measure of the cost of a
changing basket of goods that gives equivalent
satisfaction as the prices, quantities, and
qualities of the goods that consumers buy change
over time.
The
substitution issue. One of Williams’
key objections to the CPI is that instead of holding
the cost-of-living basket unchanged for long
periods, the BLS allows for frequent changes in its
composition. Some changes in the consumer market
basket occur when goods like audio cassette players
become technically obsolete and new goods like cell
phones appear on the market, but those are not the
ones that Williams takes issue with.
What he finds more
objectionable are changes in composition of the
market basket that stem directly from changes in
prices, as, for example, when people eat more
chicken because beef becomes unaffordably expensive.
To many people, fiddling the market basket to give
more weight to the goods whose prices increase least
and less to those whose prices increase most sounds
like cheating. They see it as if a teacher tried to
impress a tenure committee with high test student
scores by letting the smart kids take the test
several times each while sending their slow-learning
classmates home on testing day.
Mainstream economists have
a standard response: If we did not account for
changed consumption patterns in response to changed
prices, they say, we would overstate the cost of
maintaining a constant level of satisfaction.
Consider an example. Last week you went to the
supermarket and bought 5 pounds of chicken at $2 a
pound and 5 pounds of steak at $5 a pound, $35
total. This week you go to the supermarket and find
that chicken still costs $2 but steak has gone up to
$10. There is no question that the new prices leave
you worse off than you were the week before, but how
do you react?
You would need $60 to buy
the same basket of goods that you bought last week
for $35. In reality, you might not have that $60 in
your wallet or purse, but if I gave you a $60 coupon
that you could spend only at the meat counter, you
would probably not spend it on the same basket of
goods you bought last week. Instead, you might buy,
say, 10 pounds of chicken and 4 pounds of steak.
However, since $60 would be enough to buy your
previous selection if you wanted to, we could
conclude that you would change the mix only if the
new $60 selection gave you more satisfaction than
the original one.
Experience shows that if
you put a large number of consumers in this
situation and average their behavior, they will
shift their consumption toward chicken, even though
some individuals might stick with the original mix.
Those who did shift would be better off with $60 and
the new prices than with $35 and the old prices, and
the ones who don’t shift are no worse off. In that
sense, $60 overstates the increase in income the
average consumer would need to reach the same level
of satisfaction as before the price change.
Your cost of living has
gone up, and that hurts, but just how much
has the increase in the price of steak raised your
cost of living? By the ratio of 60/35, a 70 percent
increase, or by less than that? It depends on what
you mean by the cost of living. If you mean the cost
of buying a fixed market basket (the popular
conception), then the 70% is correct. If you mean
the cost of maintaining a fixed level of
satisfaction, then 70% is an overstatement.
The quality
issue. In addition to adjusting the
relative quantities of goods in the consumer market
basket over time, the BLS adjusts the CPI for
changes in the quality of goods. The rationale for
doing so is that failure to account for quality
improvements would cause a further overstatement of
the increase in spending that needed to maintain a
constant level of consumer satisfaction.
Consider tires for your
car. In the old days, you were lucky if a set of
bias-ply tires lasted 30,000 miles. Today, a decent
set of radial tires will go 60,000 miles or more,
and give you a better ride along the way. So, if the
price of a set of tires has increased from $100 to
$400, what has been the impact on your cost of
living? If you calculate the cost per tire, without
accounting for quality, tires are four times more
expensive than they used to be. If you calculate the
cost per mile, they are only twice as expensive.
Williams does not
necessarily object to adjusting for quality changes
when they are objectively measurable, like package
size or the number of miles you get from a set of
tires. However, he argues that the BLS exaggerates
the importance of quality by making adjustments for
changes that consumers don’t really care about. In
one post, he uses the
example of two computers, purchased ten years apart.
Yes, the newer computer has many extra features—more
memory, a faster processor, a sharper display, and
so on, each of which is quantifiable. However, not
all consumers care about the new features. If you
just use your computer for e-mail and browsing the
web, and not for running big financial spreadsheets
or high-powered gaming, who cares about processor
speed? The old model does the job just as well.
Other issues.
Williams has a number of other
criticisms of the CPI beyond the substitution and
quality issues. In particular, he takes issue with
the way the BLS measures housing prices and medical
costs. Without going into detail, in both cases
Williams favors an out-of-pocket approach to housing
and medical costs as being more in tune with the
general public’s concept of the cost of living. I
think it is fair to say that mainstream economists
agree that these two items, which loom large in
household budgets, are particularly difficult to
measure, although not everyone agrees with the way
Williams would like to see them handled. I hope to
deal with these issues in a future post, but this
one will focus on the basics.
Where ShadowStats
goes wrong: How great is the understatement?
No one really denies
that the CPI, as presently calculated, understates
the rate of inflation
compared to a measure based on a fixed basket of
unchanged goods. Rather, what many economists,
myself included, find hard to accept is Williams’
estimate of the degree of understatement.
The following chart, reproduced by permission and
updated monthly on ShadowStats.com, claims that
since the early 1980s, the CPI has been understating
the true rate of inflation by an ever increasing
margin that now amounts to some 7 percentage points.
Continued in article
Jensen Comment
It's amazing that labor unions have not had more power
in Washington DC to reduce the understatement of
inflation. Understating inflation greatly decreases
union negotiating power for raising wages in the public
and private sectors.
Note that the moral hazard of understating inflation
affected the Obama years in the presidency, but
President Obama certainly did not invent the strategy
that for many years preceded his term of office
- Federal Reserve Bank of Minneapolis Consumer Price Index Forecasting
Calculator --- http://www.minneapolisfed.org/research/data/us/calc/
-
Crime Maps
National Institute of Justice’s MAPS Program ---
http://www.ojp.usdoj.gov/nij/maps/
Statistical Abstract of the United States 2004-2005 ---
http://www.census.gov/statab/www/
Income and tax statistics from the IRS ---
http://www.irs.gov/taxstats/article/0,,id=130546,00.html
Cost of Living Calculator (comparing U.S. cities and states) ---
http://www.homefair.com/homefair/calc/salcalc.html
There are also helpful reports for persons contemplating moves to selected
cities or states.
Also see
Vitual
Relocation helpers from James Angelini, CPA. Among other things you can find
cost of living comparisons at
http://www.virtualrelocation.com/
For cost of living comparisons between nations, go to NationMaster.com ---
http://www.nationmaster.com/
Current Population on Earth ---
http://www.worldometers.info/
Projected Population Growth (it's out of control) ---
http://snipurl.com/9wu3
Sustaining the exponential growth in the human population on the planet earth
Vertical Farm ---
http://www.verticalfarm.com/
Also see
Vitual
Relocation helpers from James Angelini, CPA. Among other things you can find
cost of living comparisons at
http://www.virtualrelocation.com/
-
- Also see
http://faculty.trinity.edu/rjensen/bookbob3.htm#080512Encyclopedias
-
-
-
- Bureau of Economic Analysis ---
http://www.bea.gov/
-
-
-
- Banking and interest rate data: Econmagic.com ---
http://www.economagic.com/
-
-
-
- Consumer Price Index ---
http://www.bls.gov/cpi/
-
- What is the Consumer Price Index (CPI), including its components?
--- http://www.bls.gov/dolfaq/blsfaqtoc.htm
-
-
-
- History of the CPI ---
http://www.usda.gov/cnpp/FENR%20V11N3/fenrv11n3p64.PDF
-
-
-
- Consumer Price Index (CPI) Inflation Calculators
-
-
-
-
- Inflation Data ---
http://inflationdata.com/inflation/Inflation_Rate/HistoricalInflation.aspx
-
- United Kingdom Statistics Online ---
http://www.statistics.gov.uk/
-
-
-
- CPI Forecasting Theory ---
http://research.stlouisfed.org/publications/review/80/11/Rationality_Nov1980.pdf
-
A Story of Record Setting Pork in a
Barrel Budget of the United States Government, Fiscal Year 2005 ---
http://www.whitehouse.gov/omb/budget/fy2005/budget.html
-
-
- Measuring America: The Decennial Censuses from 1790 to 2000 [.pdf]
http://www.census.gov/prod/2002pubs/pol02-ma.pdf
- 2001 State Government Tax Collections
http://www.census.gov/govs/www/statetax01.html
- The Canadian government now offers the Canada e-book homepage with four
primary sections (included multimedia) :
The Land, The People, The Economy, and The State ---
http://142.206.72.67/r000_e.htm
-
Bob Jensen's bookmarks for
education statistical data are at
http://faculty.trinity.edu/rjensen/bookbob2.htm#050421Statistics
-
- National Climatic Data Center ---
http://www.ncdc.noaa.gov/oa/ncdc.html
-
- CensusScope ---
http://www.censusscope.org/
-
The Securities and Exchange Commission (SEC) and the
North American Securities Administrators Association (NASAA) have announced the
launch of a new Web site designed to provide information about money managers,
financial planners, and other investment advisors.
http://www.accountingweb.com/item/59363
-
-
-
Australian Bureau of Statistics ---
http://www.abs.gov.au/
Economic Statistics - INTERNATIONAL
Institute for International Economics ---
http://www.iie.com/
-
Michigan
State Univ - CIBER
-
Nanyang
Tech.
-
Ole
Miss
-
Resources
for Economists
-
United
Nations
-
Univ
of Michigan
Bureau of Economic Analysis ---
http://www.bea.gov/
- Glossary ---
http://www.bea.gov/bea/glossary/GlossaryIndex.htm
International
Business Resources on the WWW
-
Canadian
Corporate News (CCN)
-
Canadian
Corporate Newsnet (CCNet)
-
CCNet
- Company Search
-
Central
Intelligence Agency
-
CIA
- Publications
-
Deloitte
& Touche - PeerScape
-
Dept
of Commerce - Int'l Trade Administration
-
Financial
Valuation Group International
-
International
Monetary Fund (IMF)
-
London
Business School - World Forecasts
-
Morgan
Stanley - Global Economic Forum
-
Organisation
for Economic Co-operation and Development
-
OECD
- Economic Surveys
-
Statistics
Canada
-
U.S.
State Department
-
U.S.
State Department - Background Notes
-
United
Nations (UN)
-
UN
- Economic Commission for Europe
-
UN
- Statistics Division
-
Virtual
International Business & Economic Sources (VIBES)
-
WACRA
-
WEFA
-
World
Bank Group
-
World
Trade Organization
-
Yahoo!
- International Economy
Index of Economic Freedom
"Wish They
All Could Be Like Estonia," by Mary Anastasia O'Grady, The Wall
Street Journal, January 4, 2006; Page A10 ---
http://online.wsj.com/article/SB113634132194337178.html?mod=todays_us_opinion
The 2006
Index of Economic Freedom, published today by the Heritage
Foundation and The Wall Street Journal, provides powerful clues. The
annual report surveys 157 countries, grading property rights
protection, the regulatory environment, tax rates, fiscal policy,
government intervention in the economy, monetary policy, black
markets and trade policy, assigning each a numerical rating. Each
country falls into one of four categories: "free," "mostly free,"
"mostly unfree" and "repressed." The chart shows this year's
results.
|
Yale Center for the Study of Globalization
--- http://www.ycsg.yale.edu/center/index.html
Archive of European Integration (Common Market) ---
http://aei.pitt.edu/
Economic Statistics - NATIONAL
From the U.S. Census Bureau ---
http://www.census.gov/hhes/www/income/income.html
Department of Statistics:
Kingdom of Jordan
http://www.dos.gov.jo/dos_home_e/main/index.htm
Bureau of Economic Analysis ---
http://www.bea.gov/
-
LSU
-
Nanyang
Tech.
-
Resources
for Economists
-
Univ
of Michigan
-
Equityweb
-
Administration
on Aging
-
Bank
of America
-
Bank
of America - Economics & Financial Reports
-
Bureau
of Economic Analysis (BEA)
-
BEA
- Frequently Requested NIPA Data
-
BEA
- Gross product by industry
-
Bureau
of Labor Statistics (BLS)
-
BLS
- Economy at a Glance
-
BLS
- Consumer Expenditure Surveys
-
BLS
- Most Requested Series
-
Deloitte
& Touche - PeerScape
-
Dismal
Scientist
-
Economic
Indicators - U.S. Congress
-
Economic
Indicators - Univ of California
-
Economic
Indicators - Univ. of Tulsa
-
Economic
Report of the President, 1998
-
Economic
Statistics Briefing Room
-
Economy
at a Glance
-
Economy
Overview
-
Federal
Budget
-
Federal
Reserve Bank (FRB)
-
FRB
- Beige Book
-
FRB
- National Information Center
-
FRED
-
Federal
Web Locator
-
FedStats:
Site Map
-
FedWorld
- Search
-
First
Union Economic Information
-
Global
Trade Outlook
-
Joint
Economic Committee - House
-
Joint
Economic Committee - Senate
-
Intellifact.com
- Govt. Periodicals
-
InvestSIG
- Historical Data Sources
-
National
Bureau of Economic Research (NBER)
-
NBER
- Ohio State
-
National
Income & Product - Visualization
-
Office
of Management & Budget
-
Standard
& Poor's DRI
-
Stat-USA
-
State
of the Nation Library
-
Statistical
Abstract of the U.S.
-
Survey
of Current Business
-
Survey
of Professional Forecasters
-
Tax
Statistics - IRS
-
U.S.
Census Bureau
-
U.S.
Census Bureau - CENSTATS
-
U.S.
Census Bureau - People Topics
-
U.S.
Department of Agriculture
-
U.S.
Department of Commerce
-
U.S.
Department of Labor
-
U.S.
Government Printing Office
-
U.S.
Treasury Department
-
World
Bank
-
Yardeni's
- Economics Network
-
Yahoo!
Business and Economy
-
Wall
Street Journal
-
WEFA
-
WEFA
(via Primark)
-
-
Resources
for Economists
-
American
FactFinder
-
BLS
- Regional Information
-
CENDATA
-
Chamber
of Commerce
-
dbusiness.com
-
Federal
Reserve Banks
-
FRB
- St. Louis (FRED)
-
Newspapers
- Regional
-
Regional
Economic Information System
-
Standard
& Poors DRI
-
State
and Local Governments - Piper
-
State
and Local Governments - Library of Congress
-
State
of the Nation Library
-
Statistical
Abstract of the U.S.
-
Demographics Journal
BUSINESS CYCLE INDICATORS (Economic
indicators) Some links from Stephen H. Glad (links to
accounting, auditing, finance, and government sites)
CIA Publications
(includes economic statistics)
BUSINESS RESOURCES
CNNfn - the financial network
http://www.ceoexpress.com/
iTools! - Directories, Financial Markets,
References
VR Business Brokers Home Page
Welcome to Population Action
International Internet Scout Project - Home
Statistics of Income Overview from the IRS ---
http://www.irs.gov/taxstats/display/0,,i1%3D40%26genericId%3D16924,00.html
World Agricultural Information Centre Portal ---
http://www.fao.org/waicent/
From the Scout Report
Global Financial Data [.pdf]
http://www.globalfindata.com/
This impressive collection of historical global
financial data stretches from the years 1264 to 2000. While most of the
actual data must be purchased, this Website does offer several free
series, including Stock Markets since 1693, Interest Rates since 1700,
and Inflation Rates since 1264. The site also contains a decent-sized
collection of research papers written about the Eurodollar and a links
page with financial Websites from around the world.
- Finfacts Worldwide Cost of Living Survey 2001
http://www.finfacts.com/costofliving.htm
Both interesting and informative, Finfact’s
Worldwide Cost of Living Survey for 2001 compares prices of more than 200
items in 144 cities across the globe. Using New York City, which ranked
tenth in 2001, as an absolute (at 100%), the survey compares relative
costs of living in major metropolitan areas worldwide, particularly in
major financial and commercial hubs. Ranking first, second, and third
respectively, Tokyo, Moscow, and Hong Kong enjoy placement at the top of
the list. Given the current state of the economy, it is nice to see that
there are actually many places where a cup of coffee is a lot more
expensive than it is here.
-
WomenInvesting
http://www.morningstar.net/news/Ms/Women/990416women.msnhtml
The Motley Fool: How to Value Stocks (this is a misleading title to
a very good web site) http://www.fool.com/School/HowtoValueStocks.htm
-
Yahoo! - Business
and Economy:Indices
-
MACRO ECONOMICS LINKS (including data classified by
industry)
Last year I shared a platform with David Boldt at an education
technology conference at Bentley College. David has a great web site for economists,
particularly in the area of macroeconomics. His materials are listed at
http://www.westga.edu/~dboldt
If you are looking for industry and economic statistics. one place
to begin searching is at
http://econwpa.wustl.edu/EconFAQ/USMacro/index.html
The above web site leads to a heap of macro data, but you were more
interested in industry ratios. A bit of searching from the above site led me to a
University of Michigan site at http://www.lib.umich.edu/libhome/Documents.center/stats.html
There are various industry categories at the above web site. The
Business and Industry button led me to the FedStats web site at
http://www.fedstats.gov
Another good set of Federal Government links can be found at
http://www.sec.gov/others.htm
- Charles A. Dice Center for Research in Financial Economics
http://www.cob.ohio-state.edu/~fin/dice/index.htm
Insurance
Law and Pension Aids
-
MetLife Online
-
Northwestern Mutual Life®
-
Personal Finance Web
Sites (Extensive List of Links )
Free estate planning helpers
from a Georgia law firm ---
http://www.scrogginlaw.com/
ABA
LawInfo.org --- http://www.abalawinfo.org/
Your gateway to information on legal topics that
affect your daily life.
THE
FUTURE OF SEARCH --- RDF, RSS, and Pluck
December 28, 2004 message from
Richard Campbell [campbell@RIO.EDU]
Check out the following video tutorial on RSS
provided by Derek Franklin, one of the most prolific authors on Macromedia
Flash.
http://www.rssdomination.com/video.htm
Richard J. Campbell mailto:campbell@rio.edu
December
28, 2004 reply from Bob Jensen
You can read about the origins
of Resource Description Framework (RDF) at
http://faculty.trinity.edu/rjensen/XBRLandOLAP.htm#TimelineRDF
You can read more about Wiki
at http://faculty.trinity.edu/rjensen/245glosf.htm#Wiki
RSS is defined as Rich Site Summary or RDF Site Summary where RDF in this
context is a XML markup that allows you to find topics in documents that
do not necessarily use your search terminology and exclude documents that
use your terminology in a different context. . Unfortunately, the
same term in English may have vastly different meanings which leads to
getting thousands or millions of unwanted "hits" in traditional
HTML text searches.
A RSS site allows user to add
content to the site. In this sense it is like
Wiki,
but it us much more efficient and popular than a Wiki for news feeds
(although Wikipedia has just started a news feed feature.). But
Wiki's do not have the same deep RDF metadata features.
Wikipedia defines RSS as follows at
http://www.webopedia.com/TERM/R/RSS.html
Short for
RDF Site
Summary or
Rich Site Summary,
an XML
format for syndicating
Web content. A Web site that wants to allow other sites to publish some
of its content creates an RSS document and registers the document with
an RSS publisher. A user that can read RSS-distributed content can use
the content on a different site. Syndicated content includes such data
as news feeds, events listings, news stories, headlines, project
updates, excerpts from discussion forums or even corporate information.
RSS was originally developed by
Netscape.
RSS/RDF feeds are commonly
available ways of distributing or syndicating the latest news about a
given web site. Weblog (blog) sites in particular are prolific generators
of RSS feeds. Free software that integrates well with Internet
Explorer and is very simple to install is Pluck from
http://www.pluck.com/ The following are RSS search advantages described by Pluck:
For Hunters and Gatherers, a New Way to
Compare "With one click, users of Pluck can save Web bookmarks into an
online folder or email them to others."
Blurring the Line Between Affiliate and
Developer "Pluck not only integrates eBay searching into the browser, but it
improves on features built into eBay.com..."
|
-
-
-
E-Commerce News and Education ---
http://www.ecommercetimes.com/
Resources for consultants ---
http://www.consultingcentral.com/
How to do a business plan ---
http://www.sba.gov/starting/indexbusplans.html
Banking Industry
http://special.northernlight.com/banking/index.html
Free estate planning helpers from a Georgia law firm ---
http://www.scrogginlaw.com/
From the Wharton School at the University of Pennsylvania
In 1998, Microsoft executive John Wood decided to take a
rare and hard-won vacation. He started out trekking in Nepal and ended up
establishing a foundation, Room to Read, that has created nearly 3,000 libraries
in the developing world and stocked them with more than one million books. His
experiences are chronicled in a recently-published book that offers his
corporate-based perspective on how to raise money, market the product, leverage
relationships and, ultimately, maximize results.
"How John Wood Left Microsoft to Change the World -- through Books (Including
His Own)," Knowledge@Wharton, December 13, 2006 ---
Click Here
Karen's Financial Musings September 30, 2006
http://financemusings.blogspot.com/
Google's new
Reader
is a vast improvement. I think
I may give up on Bloglines. I particularly like the ability to
flag things I've read to show up in the box on the left (below
my profile). I can even set up different sharing lists for each
blog (if you're here, you probably don't care about the latest
in knitting). What's missing is the ability to search your
feeds. And, if you run out of things to read you end up
here.
Yesterday I read this
post over at
Financial Rounds. Of course, I had to
check out the
Piled Higher and Deeper
archives --
great stuff!
Here's one of my favorites.
And another.
From the Financial Rounds Blog on October 1, 2006 ---
http://financialrounds.blogspot.com/
Weekend Link Dump
It's been a pretty busy weekend
(soccer games for the kids, a football game at the
Unknown University, family visiting) and I'm a bit
behind schedule due to my wisdom tooth extraction
earlier this week. And it's been a pretty light couple
of days news-wise. So I'm only posting a couple of items
for the weekend edition of the Link Dump:
TheStreet.com does a good
job of dissecting why some firms are willing to pay
higher fees to do their IPOs in the U.S. capital
markets.
Mish's Global Economic Trend Analysis discusses
lenidng guidelines and the credit squeeze
Chuck Jaffe at
Marketwatch
gives us an
idea of what we might expect from the Putnam/MFS
merger.
Finally, the The Wall Street Journal has a couple of
interesting articles. The first one (titled
Your Portfolio on Autopilot)
discusses automated trading
systems for the small investor. Now anyone can set
up a series of rules that will trigger buy/sell
decisions. Be afraid - be very, very afraid.
And last but not least, another Wall Street Journal
article "New
10-K Footnote Can Flag Woes"
points out a new financial
footnote that investors might want to look for.
According to the article, the Securities and
Exchange Commission recently required required most
companies to include a footnote item in their
financial statements called "unresolved staff
comments." These are "any comments from an SEC
review of their filings that were material, issued
more than 180 days before the end of the fiscal year
or remain unresolved by the date of the 10-K, the
company's annual financial and business filing with
the SEC." I wonder whether they'll be good
predictors of future restatements or enforcement
actions?
The Education Alliance Network provides, free of cost, the
materials for colleges and universities to expose college-level students to financial
management software, helping them gain hands-on experience to real-world technologies.
http://www.gps.com/ean
-
Yahoo! Finance
-
The
SEC's Ten Questions to Ask About Any Investment Opportunity
BUSINESS RESOURCES
Investment
News from Wharton Now
-
Corporate Information
-
Featured Applied
Ethics Web Site
-
Hot Topics Index
Page - WBS
-
Personal Finance Web
Sites (Extensive List of Links )
-
AINTSYS-L: Journal
of Financial Information Systems
-
Bob Jensen's Vendor Database
-
British Petroleum Company Home Page
-
Comparisons of WWW
Publishing Software
-
Fidelity
-
Harvard Business School Multimedia
-
Intuit Inc.
-
Jensen & Sandlin Survey of High End Courseware Shells and
Authoring Software
-
Compare Web Tools
-
UMinfo - Tools for
Developing Interactive Academic Web Courses
Tool Comparison (Compares authoring
software, asymetrix librarian, etc.)
IBM Global Campus Community
-
Jensen & Sandlin Survey of Accountancy Education Programs
-
Jensen & Sandlin Survey of High End Courseware Shells and
Authoring Software
Welcome to CyberClass
-
WBT Systems (TopClass)
-
Macromedia -
Pathware
-
Journal of Financial
Information Systems
Some links from Stephen H. Glad (links to
accounting, auditing, finance, and government sites)
-
Texas Networking, Inc.
Internet Essentials 99
Newsletter for the financial professional
-
The Inc. 500 (Fast Growing Companies)
-
VR Business Brokers Home Page
-
William F. Sharpe,
Professor of Finance
Tax Cape is an interesting website from the standpoint of
international financing and taxation. Among other things it compares 50
leading financial sites around the world ---
http://www.taxcape.com/
I received this email requesting that I add this message
to New Bookmarks:
Your TaxCape Team
TaxCape Anstalt
http://www.taxcape.com
Landstrasse 30 FL-9494 Schaan Furstentum Liechtenstein
Tel.: +423 238 11 68; Fax: +423 238 11 69
mailto:info@taxcape.com
Guides from the SEC about calculating the cost of a mutual fund
http://www.sec.gov/mfcc/mfcc-int.htm
The Journal of Finance maintains a very
helpful and extensive web site called the Finance
Site List
http://www.cob.ohio-state.edu/htbin/htimage/~fin/journal/jf.conf?48,215
. Categories include the following:
Other Journals
Institutional Working Paper Sites
Personal Working Paper Sites
The Finance Profession
Research Centers
Link Collections
Asset Pricing & Investments
Derivatives
Corporate Finance and Governance
Financial Institutions
Research Software and Data
Educational Resources
Of Interest to Students
Misc
Charles A. Dice Center for Research in
Financial Economics http://www.cob.ohio-state.edu/~fin/dice/index.htm
-
-
Bob Jensen's Threads on Accounting Fraud, Forensic Accounting, Securities
Fraud, and White Collar Crime --- http://faculty.trinity.edu/rjensen/fraud.htm
Bob Jensen's
Threads
on Fees and Choosing Accountants, Financial Advisors, and Consultants ---
http://faculty.trinity.edu/rjensen/fees.htm
Small Business Administration:
Managing ---
http://www.sba.gov/managing/index.html
Bob Jensen's Tax Helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#010304Taxation
39 Free QuickBooks Online
Tutorials ---
http://fitsmallbusiness.com/free-quickbooks-online-tutorials/
Thank you Crystalynn Shelton and
Kristian Rivera --- |
http://fitsmallbusiness.com/category/accounting/
Methodology to Identify
Small Businesses and Their Owners
Department of the U.S. Treasury
Technical Paper 4
August 2011 ---
Click Here
http://www.treasury.gov/resource-center/tax-policy/tax-analysis/Documents/OTA-T2011-04-Small-Business-Methodology-Aug-8-2011.pdf
Comments from Paul Caron on August 9,
2011 ---
http://taxprof.typepad.com/
The Treasury Department's
Office of Tax Analysis has
released
Methodology to Identify Small
Businesses and Their Owners:
Due to data constraints and the
lack of clear definitions, prior
analyses of the tax code’s
impact on small business owners
were flawed. In this paper, we
develop a methodology to define
and identify small businesses.
We then apply that methodology
to a new data source to identify
the individual owners of those
small businesses. Having matched
owners to their small business
entities, we present tabulations
that detail various tax
characteristics of small
businesses and their owners for
tax year 2007. ...
For tax year 2007, our previous
methodology counted 34.7 million
filers reporting $662 billion of
net flow-through business income
as small business owners. Using
our revised methodology, we
count 20.0 million filers
reporting $376 billion of net
business income as small
business owners under a broad
measure of small business owner.
Under our narrow definition, we
count 9.4 million filers
reporting $335 billion of net
business income as small
business owners.
A History of Entrereneurship
"Who Are The Entrepreneurs: The Elite or
the Everyday Man? A History of
Entrepreneurship," by Heather A. Haveman,
Jacob Habinek, and Leo A Googman, UC
Berkeley, 2011 ---
http://www.escholarship.org/uc/item/392635v2;jsessionid=00ECE18AD2472F4956AAF2D00CC2132E#page-2
Who
Are The Entrepreneurs: The Elite or the
Everyday Man? A History of
Entrepreneurship
We trace the social positions of the
men and women who found new
enterprises from the earliest years
of one industry’s history to a time
when the industry was well
established. Sociological theory
suggests two opposing hypotheses.
First, pioneering entrepreneurs are
socially prominent individuals from
fields adjacent to the new industry
and later entrepreneurs are from an
increasingly broad swath of society.
Second, the earliest entrepreneurs
come from the social periphery while
later entrepreneurs include more
industry insiders and members of the
social elite. To test these
hypotheses, we study the magazine
industry in America over the first
120 years of its history, from 1741
to 1860. We find that magazine
publishing was originally restricted
to industry insiders, elite
professionals, and the highly
educated, but by the time the
industry became well established,
most founders came from outside
publishing and more were of middling
stature – mostly small-town doctors
and clergy without college degrees.
We also find that magazines founded
by industry insiders remained
concentrated in the three biggest
cities, while magazines founded by
outsiders became geographically
dispersed. Finally, we find that
entrepreneurship evolved from the
pursuit of a lone individual to a
more organizationally-sponsored
activity; this reflects the
modernization of America during this
time period. Our analysis
demonstrates the importance of
grounding studies of
entrepreneurship in historical
context. Our analysis of this “old”
new media industry also offers hints
about how the “new” new media
industries are likely to evolve.
Bob Jensen's threads on accounting
history ---
http://faculty.trinity.edu/rjensen/Theory01.htm#AccountingHistory
The BizWorld Foundation (Venture Capital, Entrepreneurship) ---
http://www.bizworld.org/
This site has a section on "Classroom Resources"
In answer to a September 11, 2010
question about small business research
and available databases databases
Hi Saeed,
Germain
Boer is the Director of the
Owen Entrepreneurship Center at
Vanderbilt University ---
http://www.owen.vanderbilt.edu/vanderbilt/About/faculty-research/f_profile.cfm?id=85
He’s very experienced in small
business research. I suggest that
you contact Germain when you’ve
narrowed down your questions.
Jerry Trites up in Canada maintains an eBusiness blog and has
conducted considerable research on
eBusiness. He might have some useful
suggesting, although he may be more
familiar with databases in Canada
---
gtrites@ZORBA.CA
Some Small Business Data Centers
SBA ---
http://www.sba.gov/
(note the SBA tabs to Local
Resources, Tools, Services, and
Planner)
Hoovers ---
http://www.hoovers.com/
Dunn & Bradstreet ---
http://trial.selectory.com/msn/mtw_small_business_database2.html?
MNI Store ---
http://www.mnistore.com/index.asp?source=HKM&keyword=General
eBusiness Data ---
http://mediakit.internet.com/mediakit/
Internet Data ---
http://www.webreference.com/internet/statistics.html
FreeBytes Guide ---
http://www.freebyte.com/programming/database/
Some Other Helpers and Guides
AMA Resources Center ---
http://marketingresourcedirectory.marketingpower.com/index.php
Business.gov ---
http://www.business.gov/
SEC Helper Site ---
http://www.accountingweb.com/item/59363
KnowThis ---
http://www.knowthis.com/
Advertising World at
http://advertising.utexas.edu/world/
Advertising Age at
http://www.adage.com/
Mousetracks Marketing List of Lists
http://www.nsns.com/MouseTracks/tloml.html
American Marketing Association
http://www.ama.org/http://cwis.kub.nl/~few/few/be/marketin/links.htm
You
might consider searching for some
relevant small business case
research studies
Bob Jensen
September 15, 2010 reply from
Steven Kachelmeier, University of Texas
at Austin
[kach@MAIL.UTEXAS.EDU]
The January
2009 issue of The Accounting Review
featured a forum on accounting
research involving small, privately
held companies. It featured two main
articles -- one by Kristian Allee
and Teri Yohn and one by Gavin
Cassar, along with a commentary by
Gregory Waymire that synthesizied
the contributions of both studies in
the forum along with some broader
observations.
Gavin
Cassar (Wharton) in particular
specializes in research on
accounting issues facing start-up
ventures. You might want to contact
him for more references in this
area, though several of them are
cited in his January 2009 article.
Best
regards,
Steve
Steven
Kachelmeier
Senior Editor, The Accounting Review
September 11, 2010 reply from
James Martin
Saeed,
It's not a
large section, but anything I find
in the management and accounting
literature related to small business
goes here:
http://maaw.info/SmallBusinessArticles.htm
You might
find some useful papers in some of
MAAW's other sections as well such
as:
The service
industry bibliography:
http://maaw.info/ServiceIndustryArticles.htm
The
Accounting for... Bibliography:
http://maaw.info/AccountingForArticles.htm
and the
Health Care Bibliography:
http://maaw.info/HealthCareArticles.htm
James R.
Martin
Small Business Association Loan
Terms Glossary ---
http://www.sbaloans.com/sba-glossary.php
Bob Jensen's threads on accounting and
finance glossaries ---
http://www.sbaloans.com/sba-g
Software and Personal Finance Helpers for Individuals and Small Businesses
Software Buying
and Use Guides
SMB
Finance and Accounting Checklist
What a great site Saeed. Thank you.
On the personal
financing and investment side of things,
I like the following link:
"The Best Online
Tools (software, services) for Personal
Finance," The Wall Street Journal,
June 8, 2009 ---
http://faculty.trinity.edu/rjensen/PersonalFinanceTools.htm
Bob Jensen’s
threads on accounting software are at
http://faculty.trinity.edu/rjensen/BookBob1.htm#AccountingSoftware
A
Government Website for Helpers in
Personal Finance
MyMoney.gov is
the U.S. government's website dedicated
to teaching all Americans the basics
about financial education. Whether you
are planning to buy a home, balancing
your checkbook, or investing in your
401k, the resources on MyMoney.gov can
help you do it better. Throughout the
site, you will find important
information from 20 federal agencies
government wide.
My Money.gov ---
http://www.mymoney.gov/
The
AICPA's Financial Literacy Helper Site
---
http://www.360financialliteracy.org/
Damodaran Online: A Great Sharing
Site from a Finance Professor at New
York University and Textbook Writer ---
http://pages.stern.nyu.edu/%7Eadamodar/
Jim
Mahar's finance sharing site
(especially note his great blog link)
---
http://financeprofessor.com/
Financial Rounds from an anonymous
finance professor ---
http://financialrounds.blogspot.com/
Bob
Jensen's personal finance/investment
helpers are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#Finance
Small Business Administration:
Free Online Courses (video) ---
http://www.sba.gov/services/training/onlinecourses/index.html
"SBA Warns Small Businesses of
Scams to Help Obtain Government Loans,"
Journal of Accountancy, April 1,
2010 ---
http://www.journalofaccountancy.com/Web/20102758.htm
Bob Jensen's threads on fraud
reporting are at
http://faculty.trinity.edu/rjensen/fraudReporting.htm
RIP:
The End of Microsoft Office Accounting
Microsoft is formally backing away from the small
business accounting market after announcing that the Office Accounting program
will no longer be distributed after November 16, 2009. In addition, the
Microsoft Professional Accountant's Network (MPAN) will no longer accept new
members as of that date.
AccountingWeb, November 4, 2009 ---
http://www.accountingweb.com/topic/technology/end-microsoft-office-accounting
Bob Jensen's accounting software threads
are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
From the Darden School of Business at the University of
Virginia
The Batten Institute (for creation of knowledge about entrepreneurship) ---
http://www.darden.virginia.edu/BattenInstitute/BattenInstitute.aspx?menu_id=494
Small Business Helpers from Smart Stops on the Web, Journal of
Accountancy, December 2008 ---
http://www.journalofaccountancy.com/Issues/2008/Dec/SmartStops.htm
SMALL OFFICE / HOME OFFICE
GET YOUR BUSINESS OFF
THE GROUND
www.business.gov
Known as “The
Official Business Link to the U.S.
Government,” this site is a virtual
one-stop shop for information on
running a small business. Operated
by the Small Business
Administration, this Smart Stop
offers guides on starting and
managing a business, government
contracting, taxes and a host of
other topics. There’s also a helpful
tool to determine what types of
federal, state and local licenses
and permits are needed for a variety
of businesses, along with contact
information for the appropriate
agencies. There’s even a separate
section filled with information
tailored for home-based businesses,
which the SBA says account for more
than half of U.S. businesses.
FEEL RIGHT AT HOME
www.2minutecommute.com
This blog
offers commentary and advice for
people who work out of their homes.
Recent postings included advice on
feeling secure in an insecure
economy, a video review of telephone
headsets, and an alert about
“business opportunity” scams. The
site also looks at how to avoid the
isolation of working from home by
co-working, or sharing space with a
group of other self- employed
professionals. Postings can be
viewed by subject, such as “Business
Ideas” or “Financing.”
MAKE YOUR SMALL
BUSINESS WORK
www.esmalloffice.com
This Smart
Stop offers articles and weekly
columns for the small business
owner. It features a “Business
Guide” with dozens of how-to
articles offering advice on
everything from writing a press
release to analyzing profitability.
Other articles are grouped into
topics including “Starting Your
Business,” “Managing Your Money” and
“Government Resources.” The site
licenses content from providers such
as Commerce Clearing House, the
Edward Lowe Foundation and the
Kauffman Foundation. You can also
sign up to receive a free monthly
e-newsletter.
GENERAL INTEREST
GET A CREDIT CLUE
www.controlyourcredit.gov
Way
more fun than a lecture, the U.S.
Treasury’s interactive site features
The Bad Credit Hotel game, which
provides information on keeping up a
good credit score. The premise is to
solve a mystery in a creepy hotel,
with the goal of racking up enough
credit tips to get to room 850—the
perfect credit score—and unlock
bonus information. Along the way,
you collect clues on debt
management, credit history and
credit cards by clicking through to
different rooms and clicking on key
objects in each room. After
collecting enough clues, players get
to enjoy the secret perks found in
room 850.
Small Business
Administration information services
guides
Business.gov ---
http://www.business.gov/
Bob Jensen's small business helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#SmallBusiness
Bob Jensen's links to business and
economics data ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#EconStatistics
"Disaster recovery, backup, and restore: Big challenges for
small businesses," AccountingWeb, April 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=104490
The time and effort involved in
creating the plan can be reduced by
using readily available disaster
recovery templates or working with
consultants, but the starting point
for every company is a risk
analysis, according to the
Disaster Recovery Planning Forum,
identifying and assessing the
potential that the loss of business
functions, processes, and records
could have on the operation of the
business.
When writing a disaster recovery
plan, you can find recommendations
on the Forum, including the
following:
-
Identify and define the company's
mission critical business processes
and systems. Review them for
vulnerabilities and identifying
steps required for restoration and
recovery.
-
Make sure data is backed up to
secure and separate locations.
-
Evaluate various storage solutions
including storage area networks,
data replication systems, new
virtualization systems, network
attached storage devices, and
managed storage.
-
Pay significant attention also to .
. . telecommunications providers to
ensure they have built diversity and
redundancy into their networks and
have well developed and tested
contingency plans.
Members of the forum suggest that
employees should be invested in the
plan and fully informed about their
responsibilities in a disaster. The
disaster recovery plan should detail
how business managers will
communicate with their employees.
With the overload on cell phone
communication that occurred during
the September 11th, 2001 disaster in
mind, some specialists are
recommending options such as
contracting with a third party
service for backup e-mail domains or
using text messaging services.
Managers also need to consider the
impact of staff using the more
affordable smart phones that can
support business functions. As these
devices come into use, IT staff must
set up procedures to secure data,
according to Chen.
Implementing any plan will require
selecting backup technology and
storage and establishing procedures.
Tape backup systems require that
someone be able to physically remove
them from a damaged office. Online
options which have increased
dramatically in recent years,
including software packages
available for small businesses, have
the advantage of providing offsite
storage as well as backup
Prices for online services are all
over the map, so it pays to shop
around. For example, two products
recommended by PC Magazine
are
SOS online backup, which costs
$74.50 per year for 1GB; $237 per
year for 10GB, and Mozy Remote
Backup, which costs only $39.95 a
year for 20 GBs.
Third party services usually charge
monthly rates for back up and
storage of files and servers. Laura
DuBois, an analyst at International
Data Corp., believes many of these
services are good enough in terms of
general protections, according to
internetnews.com.
But
the service provider should be a
true partner to function well in
disaster recovery.
Attila Kozma, president of Earth to
Stars of Glendale, CA, the company
offering ThetaBackup.com, suggested
several tips to help business owners
select an appropriate vendor
internet news.com reports:
-
The transferred data need to be
encrypted and compressed before
transmission;
-
The online backup and data recovery
practices of the online backup
company should be verified to
determine if they store SMB data
securely;
-
Recovery times must be rapid;
-
On-site professional help should be
available whenever requested at an
affordable rate;
-
Open files should be backed up;
-
Many versions of files should be
saved online, as opposed to only the
last saved version; and
-
The online backup client software
should verify the sent data for its
correctness.
Iron Mountain Digital is the world's
largest provider of data
backup-recovery and archiving
software as a service. Iron Mountain
offers a range of services for small
and medium sized businesses, the
company's web site says. Peachtree
Online Backup partners with Iron
Mountain for PC backup. .
Disaster recovery infrastructures
for small and medium businesses have
become more affordable in the past
year with disk-to-disk backup and
server virtualization,
techtarget.com reports. Other
technologies that are available are
storage networks and data
deduplication technology, which
automatically removes duplicate
records. Microsoft, Intel Corp., and
Advanced Micro Devices are building
virtualization into their
infrastructures and, "It's now
relatively easy to implement for an
SMB without huge depth of knowledge
of virtualization," says Carmi Levy
of Info-Tech Research Group Inc. in
London, Ontario, according to
cio-midmarket.com.
Testing the disaster recovery plan
is critical. Access to the company's
system should be restored and the
data should be retrieved from off
site storage. Changes to the IT
environment can affect the recovery,
so testing every six months or every
year will be needed to ensure that
the recovery plan functions in the
current environment. Managers and
staff should be fully involved in
testing.
"How to protect
data - a quick reference,"
AccountingWeb, April 2008 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=103784
The
latest technologies and gadgets make
it incredibly easy for your data to
be stolen from right under your
nose, unless you take steps to
protect it. Nick Lowe, from
Check Point Software,
reports.
The ability to move massive amounts
of information between PCs and
portable storage devices means that
it's now incredibly easy for
confidential data to be taken from
companies without knowledge or
consent
The perpetrators of such crimes are
rarely stereotypical hackers,
attacking systems via the internet
from their mafia headquarters or
their student dorms. Instead, the
data thieves are frequently much
closer to home. Unescorted visitors,
for example, or temporary staff who
have joined the organization purely
to copy data and hand it over to a
competitor. Or, as is becoming
increasingly common, unhappy staff
who are about to resign but think
it's a good idea to first take
copies of anything which might be
useful in their new job. And lastly,
innocent employees who simply don’t
follow security policy, copy work
files to take home and lose the
unprotected storage device.
Unguarded USB ports on today's PCs
are perhaps the biggest threat to
corporate IT security. USB memory
sticks can typically store up to a
gigabyte of data, but an MP3 player,
smartphone or PDA can be just as
effective for the data thief as they
can all be quickly connected to any
PC via a USB cable without the need
for any driver software to be
installed (and therefore, without
the need for the thief to be logged
in as an administrator).
A
few drags and drops, and the deed is
done in a few seconds. Where the
amount of data to be stolen is
beyond the capacity of an iPod or
PDA, external USB drives comprising
half a terabyte of storage are now
available on the high street for
less than a hundred pounds.
USB devices aren't the only way in
which information can be stolen
electronically, of course. Most
mobile phones nowadays include a
camera, which can be used to quickly
make an electronic copy of a printed
page.
Pocket OCR wands and portable
scanners offer similar facilities to
the opportunistic data thief who
stumbles across a confidential
printed document. Or he could simply
make a photocopy of a document and
put it in the post. However, using
any of these methods to steal large
quantities of data is simply not
practical because of the time
required. Controlling the use of USB
devices is of far greater
importance.
While the disgruntled employee is a
prime suspect in many data thefts,
actions by former employees should
also be considered in your data
protection plans. Do all of your
users’ accounts and passwords get
deleted as soon as the person leaves
the company or changes department?
Failure to delete such information
isn’t just dangerous, but might also
mean that you fall foul of the Data
Protection Act by storing personal
information that you do not need to
retain.
To
reduce the problem of data leakage
in your company there are three
effective strategies. First, ensure
that you have a policy which clearly
states who is allowed to take data
off-site, and how the data must be
protected when it’s away from your
premises.
Second, ensure that data doesn't
leave the building without your
knowledge. Finally, ensure that data
which needs to be removed from the
building is protected so that it
can’t fall into the wrong hands.
To
control which data files leave your
premises in the first place, set up
user accounts on servers and
workstations so that employees can't
access information which they have
no need to see. Those in sales and
marketing, for example, probably
don't need access to the product
development department's files on
the server, so set the access
permissions accordingly.
Over-use of rules and regulations
can lead to low morale, however, if
the workforce feels that it clearly
can't be trusted. Beware of becoming
seen as Big Brother. It won't drive
the data thieves away, but simply
make them more determined.
It's also well worth investing in a
port control product such as my
company's Pointsec Protector, which
can automatically block USB devices
from being connected to your systems
without authorization. The software
also includes transparent
encryption, so that information
copied to USB devices is
automatically rendered inaccessible
to thieves.
Normally you will want to prevent
confidential files leaving your
premises, but this won't always be
the case. Sometimes, allowing staff
to take files away is necessary and
beneficial. Salespeople need access
to product information when they're
away from the office, and marketing
people often prepare PowerPoint
presentations for delivery at
conferences and seminars. Staff need
to take work home at the weekend if
they're particularly busy, and
preventing them from doing so will
deprive the company of some useful
effort (not to mention all that
unpaid overtime).
It's absolutely vital that you
protect information which is taken
off the premises. If a sales
manager's laptop is stolen from the
boot of her car, you need to be sure
that the customer information on its
hard disk can't be accessed by the
thief. If your marketing manager's
PDA goes missing while he's at a
conference, can you be confident
that the document containing details
of next year's product launches
won’t be accessible to whoever buys
the stolen hardware?
The solution to this problem is
encrypting data. There are many
products on the market, but ensure
that the solution you choose is
proven, transparent and automatic,
eliminating user interaction and
creating a fully enforceable
solution that holds up to the most
stringent compliance requirements.
Deploying an encryption solution
will improve the level of trust and
loyalty of clients and employees who
recognise that every effort is being
made to protect their sensitive data
and ensure that a lost or stolen
device never results in a data
breach.
Bob Jensen's
technology bookmarks are at
http://faculty.trinity.edu/rjensen/Bookbob4.htm
Bob Jensen's
threads on total backup options are at
http://faculty.trinity.edu/rjensen/Bookbob4.htm#TotalBackup
Anita Campbell's Small Business Blog
on the AccountingWeb ---
http://www.accountingweb.com/blogs/anita_campbell_blog.html
Bob Jensen's threads on blogging are at
http://faculty.trinity.edu/rjensen/ListServRoles.htm
TACKLING SMALL BUSINESS TECH ISSUES
From Smart Stops on the Web, Journal of Accountancy, July 2008
This new site from Inc. magazine offers
information on technological devices and trends of all stripes. Read articles on
hardware, software, e-business, managing technology, networking, security, and
telecom and wireless. “Expert Corner” features posts by guests in areas such as
content management, and “Technology Blog” provides news and views on topics
ranging from America’s broadband efforts to notebook Blu-ray DVD players to cell
phones. Plus, business leaders share firsthand experiences in Q&A format in the
“Tech Talk” section.
"Online
Accounting Tools Still Come Up Short,"
Rob Pegararo, The Washington Post,
May 22, 2008. Page D03 ---
Click Here
Few types of desktop software should
be readier for replacement by the
Web than personal finance.
The concept behind these programs is
sound: Track your income and
expenses through automatic downloads
from banks, credit card issuers and
other financial institutions to show
where your money's coming and going,
and how much of it you're likely to
have later on.
But the market
long ago calcified into a duopoly of
programs,
Intuit's
Quicken
and
Microsoft's
Money. As
they've piled on the features, their
usability has suffered. Many users,
fearing an ordeal of bookkeeping,
avoid them entirely. Those who have
bought either program have been
forced to ante up for new versions,
at $15 to $90 each, when "sunset"
policies cut older releases off from
account-data downloads.
It might seem that a simpler,
cheaper alternative to these
programs would have emerged on the
Web, now that online shopping and
bill payment have made people
comfortable with managing money
online. But the big Web companies
have yet to craft such a thing.
Fortunately,
the absence of a shiny new Web
application from
Google or
Yahoo
doesn't mean the absence of hope for
online alternatives to Quicken and
Money. It may just mean you'll have
to wait longer to find one that
suits you.
The most
visible Web competitor so far has
been the free Mint (
http://mint.com).
Since its
launch last fall, this Silicon
Valley start-up has drawn 266,000
users, though founder Aaron Patzer
did not say how many visit the site
regularly.
Quicken or Money vets may find Mint
insultingly simplistic. It only
links to banks, credit cards and
investments and ignores most
people's biggest debts (mortgages
and car loans) and assets (homes and
vehicles), making net-worth
estimates impossible.
Using Mint requires you to trust the
site to safeguard your bank
usernames and passwords, which you
must save there before adding any
accounts. You can't enter
transactions by hand or upload
Quicken or Money files. And you
can't reconcile transactions against
a monthly statement.
But within those limits, Mint
provides soothingly simple
money-management tools.
When tested
with a bank account, two credit
cards and three mutual funds, Mint
automatically fetched the latest
data, converted most gibberish in
these accounts' downloads into real
names and filed most entries in the
right category. For example, a
credit card charge to "WHOLEFDS ARL
10042 0ARLINGTON" became "Whole
Foods,"
listed under "groceries."
It was even smart enough to split
fees on ATM withdrawals into
separate expenses.
Mint then broke down patterns of
income and expenses into
easy-to-read pie charts.
Mint aims to
make money by suggesting better
financial services, then collecting
commissions. But its advice to drop
an
American
Express
card for a Chase Visa ignored the
AmEx card's cash rebate.
Two other
sites have begun grabbing users as
well. The free Wesabe (
http://wesabe.com),
an older
Silicon Valley start-up, acts like a
money-minded social network.
It makes the collective wisdom of
its users part of its source code,
comparing your spending and earning
with the averaged habits of more
than 100,000 other "Wesabeans." It
also relies on their accumulated
input to refine and sort statement
entries and offer tips about better
deals near you.
But Wesabe may need more users (at
least near Washington) to do those
jobs well. Most downloaded
transactions came through in their
original, cryptic bankspeak, and
some tips showed a Bay Area bias.
This site's free-form system of
tagging, in which you can slap
multiple categories onto a single
transaction, also yielded duplicate
entries in its spending summaries.
Wesabe (which plans to underwrite
its free service with a fee-based
"pro" option) is even more limited
than Mint. It couldn't connect to a
Bank of America Visa credit card
account, and it doesn't do
investments or home or car loans.
In Wesabe's favor, it offers free
Mac and Windows uploader programs
that keep your account logins on
your computer and offers multiple
ways to get your data off the site.
It even posts a toll-free number
that you can call to reach its chief
executive each afternoon.
Wesabe may appeal most to extroverts
with specific financial goals who
can easily set targets and solicit
fellow users' advice in its forums.
One of the
newest Web-based personal finance
tools comes from Intuit, which in
January launched the $2.99-a-month
Quicken Online (
http://quickenonline.com).
Although this
site isn't as slick or quick as Mint
or Wesabe, it supports investments
and mortgages, not just banks and
credit cards.
Unlike Mint and Wesabe, it also lets
you add coming transactions -- no
risk of forgetting the check you
wrote to your contractor-- and set
bill-payment reminders.
Some basic features, such as
transaction breakdowns and the
ability to upload Quicken files or
download data from the site, still
aren't there. But its simplicity
makes the gridlocked complexity of
desktop Quicken look painfully
obsolete.
These sites
and other competitors promise
tantalizing upgrades. For example,
Mint says it will soon add
mortgages, with estimates of home
values from
Zillow.com
or another assessment source.
With such improvements, some smart
borrowing (picture Mint's interface
plus Wesabe's social smarts) and a
solid record of security, Web
personal-finance software could
become an alternative along the
lines of Web e-mail. Some people
might never accept such a thing, but
others wouldn't think of using
anything else
Jensen Comment
Pegararo failed to research online
complete Webledger systems such as Net
Suite and other important sites that
will not only perform accounting
functions, manage inventories, manage
receivables, perform financial analyses,
and do all sorts of sophisticated
financial analyses. These Webledger
systems will also store accounting
records so they can be accessed all over
the world and allow users to avoid
paying for expensive hardware/software
technical support, backup systems, and
consultants ---
http://faculty.trinity.edu/rjensen/Webledger.htm
Pegararo also fails to mention many of
the personal finance Web options and
small business accounting options:
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
http://faculty.trinity.edu/rjensen/Bookbob1.htm#SmallBusiness
Pegararo might not have found the Web
options coming up short if he'd done
more research for the above article.
Marketing Sites for Small Businesses
From the Journal of Accountancy
Smart Stops on the Web in April 2008 ---
http://www.aicpa.org/pubs/jofa/apr2008/smart_stops.htm
PRACTICE DEVELOPMENT |
|
MARKETING KNOW-HOW
http://tinyurl.com/2g7bwv
Looking to attract new
clients or increase your
firm’s visibility? Visit
this Smart Stop to access
the AICPA’s “CPA Marketing
Tool Kit,” part of the
Institute’s public
accounting firm resources.
The collection offers
customer service and selling
tips, client satisfaction
surveys, PDF brochures and
guidelines for becoming a
media resource. The
marketing guide includes a
sample e-newsletter
template, do’s and don’ts
when creating and marketing
a Web site, and e-mail
marketing tips.
BE A PROMOTION GURU
www.marketingsherpa.com
Find case studies on what
works—and what doesn’t—when
it comes to marketing your
business on this site from
MarketingSherpa. The
research firm also provides
how-to articles and
interviews with marketing
directors in both
business-to-business and
consumer marketing. Click
the “Browse by Topic/Brand”
tab for a complete listing
of articles by industry or
target, such as “Marketing
to Small Businesses” or
“Business Services
Marketing,” or tactic, such
as “Integrated Campaigns” or
“How to Pitch to Business
Media.
MARKET PROFESSIONAL SERVICES
www.legalmarketingblog.com
Don’t let “legal” throw you
off—this site’s client
communication and marketing
tips can be applied to CPA
firms wanting to expand
their service offerings or
client base. Author Thomas
Kane, Esq., the principal of
Kane Consulting Inc., has
served as an in-house
marketer for several firms.
Check out articles like
“Guarantee Client Referrals
With Good Client Relations”
and “Narrow Your Niche for
More Effective Marketing,”
or explore the Web’s
marketing resources using
Kane’s extensive library of
marketing and firm blogs.
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GENERAL INTEREST |
|
LINK AND GO
www.taxsites.com
First appearing in this
column in October 2004, this
index of tax, accounting and
payroll specific sites
underwent a complete
redesign recently. The new
site features an expandable
navigation tree and improved
search capabilities using a
Google custom search. There
is also quick access to the
site’s most commonly
requested pages—including
federal and state tax
forms—as well as links to
industry associations,
certification information
and software vendors.
LEAD BY EXAMPLE
www.calcpa.org/forum
Corporate CPAs and financial
executives: This leadership
forum from the California
Society of CPAs and the
California CPA Education
Foundation is for you. The
site provides executive
education, advanced training
in finance and business
management, thought
leadership, helpful
resources and professional
peer networking. The site
also features opportunities
such as participation in
economic forums, CFO of the
Year events and local
roundtable discussions,
which are listed in the
“Upcoming Forum Events”
section. You can read
articles, such as how-tos
with practical tips and Q&As
with other leaders in the
field. There is also a
section featuring news on
such hot topics as the XBRL
taxonomy and new PCAOB
standards. |
Small Business Accounting for Managers Who
Want to Learn Accounting Basics
I am very biased. I think small businesses
should make more use of Webledgers (accounting systems on the Web) to do their
accounting rather than mess with their own systems or, in many instances, local
bookkeeping service firms. Key advantages and disadvantages of Webledgers can be
found at
http://faculty.trinity.edu/rjensen/Webledger.htm
In particular I recommend NetSuite ---
http://www.netsuite.com/portal/home.shtml
Of course there are many software options for
small businesses that want to manage their own accounting systems. Price
generally varies with the level of sophistication. For example, software for
managing receivables, inventories, and payroll generally costs more. There are
also some free accounting software alternatives ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
There are also very elementary textbooks
introducing managers to the basics of bookkeeping and accounting. Some of them
are free online ---
http://faculty.trinity.edu/rjensen/ElectronicLiterature.htm#Textbooks
There are also elementary textbooks from
virtually all textbook publishers. There are also some accounting books and
services targeted for small businesses ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm#SmallBusiness
One publisher recently sent an email message
about a small business accounting book called Radical Accounting. It claims to
have a nontraditional learning approach. It is not a free online textbook ---
http://www.radicalaccounting.com/index1.php
Bob Jensen
ALPFA: The Association of Latino Professionals in Finance and
Accounting offers career and community resources ---
http://www.alpfa.org/
How can poor people of the world
learn how to get financing? International Finance Group ---
http://www.ifc.org/
"The
Role of Small and Large Business in Economic Development,"
by Kelly Edmiston, The Kansas City Federal Reserve, June 2007 ---
http://www.kansascityfed.org/PUBLICAT/ECONREV/PDF/2q07edmi.pdf
"5 Start-Up Mistakes Entrepreneurs
Should Avoid," AccountingWeb, April 20, 2007 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=103434
In the Name of Entrepreneurship?
The Logic and Effects of Special
Regulatory Treatment for Small Business
(a 368 Rand Corporation Report on ways
to stimulate and improve
entrepreneurship, December 2007) ---
http://www.rand.org/pubs/monographs/2007/RAND_MG663.pdf
Small Business Helpers
Smart Stops on the Web, Journal of Accountancy, March 2008 ---
http://www.aicpa.org/pubs/jofa/mar2008/smart_stops.htm
SMALL
BUSINESS |
|
SOX
ASSISTANCE
www.sec.gov/info/smallbus/404guide.shtml
This site
features
content from
the SEC’s
Sarbanes-Oxley
Section
404—A Guide
for Small
Business,
a
publication
for small
public
company
managers and
their
auditors as
they begin
to assess
internal
control over
financial
reporting.
Sections
such as
“What
Constitutes
Effective
Internal
Controls?,”
“Identifying
Financial
Reporting
Risks and
Controls
That Address
Them,” and
“Do Your
Controls
Work in
Practice?”
guide small
business
managers
through the
assessment
process for
the first
time. The
complete
guide is
also
available in
a printable
version.
FOCUS ON
SMALL FIRMS
http://pcps.aicpa.org
Visit the
AICPA’s PCPS
Firm
Practice
Center for
the most
recent
installment
of Small
Firm
Solutions,
a new
e-newsletter
for small
firms and
sole
practitioners.
The
quarterly
publication,
part of the
Institute’s
“Small Firm
Advantage”
initiative,
features
“Hot Topics
for Small
Firms” from
James
Metzler,
CPA, AICPA
vice
president–Small
Firm
Interests.
The site
hosts a
collection
of helpful
resources
from the
Small
Business
Administration
on startup
businesses
and on
managing
existing
businesses.
PCPS members
can also
access the
“Risk
Assessment
Standards
Toolkit” for
SAS nos.
104–111, as
well as
small firm
marketing
brochures.
LEARN FROM
EXPERIENCE
www.smallbiztrends.com/resources/the-experts
Here, dozens
of small
business
experts
share their
wealth of
knowledge in
articles,
interviews
and book
reviews. A
pull-down
menu lets
you choose
information
in your area
of interest
or by
specific
expert.
These
business
owners and
guest
columnists
offer
information
on topics
such as
globalization,
Web design,
employment
trends and
sales. You
can also
link to
other small
business
resources,
subscribe to
the
twice-monthly
Small
Business
Trends
newsletter
and comment
on articles.
SMALL BIZ
SUPPORT
www.sba.gov/advo
Stay current
on federal
regulatory
policies and
proposals—including
Sarbanes-Oxley
compliance
deadlines
for small
public
companies—that
could affect
your small
business
clients at
this Smart
Stop from
the Small
Business
Administration.
You can
electronically
subscribe to
the Office
of
Advocacy’s
newsletter,
The
Small
Business
Advocate,
or sign up
for RSS
feeds of
regulatory
news and
research,
such as
state
economic
profiles and
banking and
financial
research.
There is
even a
complete
chronology
of the
organization’s
Sarbanes-Oxley
activities
at
www.sba.gov/advo/laws/comments/sarbanes_oxley.html. |
|
|
GENERAL
INTEREST |
|
WORD OF
MOUTH
www.automatic-referrals.com
Written by
Miriam
Lawrence,
director of
Horsemouth,
a
business-building
resource for
financial
advisers,
the site
provides
tactics and
tips for
professionals
who use
referrals
for business
development
and growth.
Find
articles
such as
“Five Great
Times to Ask
for
Referrals”
and “Keep a
Referral
Scorecard,”
or catch up
on
Lawrence’s
“ABCs of
Automatic
Referrals”
series,
which starts
with “A is
for Action”
and works
through the
alphabet,
including “K
is for
K.I.S.S.
(Keep It
Simple and
Specific).”
The site
also touches
on topics
such as
client
service and
relationships,
marketing
and
communicating
value.
FINANCIAL
REPORTING
PORTAL
www.financialexecutives.org/blog
Find news
highlights
from the
SEC, FASB
and the
International
Accounting
Standards
Board on
this
financial
reporting
blog from
Financial
Executives
International.
The site,
updated
daily,
compiles
regulatory
news,
rulings and
statements,
comment
letters on
standards,
and hot
topics from
the Web’s
largest
business and
accounting
publications
and
organizations.
Look for
continuing
coverage of
SOX
requirements,
fair value
reporting
and the
Alternative
Minimum Tax,
plus
emerging
issues such
as the
subprime
mortgage
crisis,
international
convergence,
and rules
for tax
return
preparers.
GETTING A
CLUE
http://10qdetective.blogspot.com
The mission
statement
says it all:
“It is the
job of the
10Q
Detective to
dig through
businesses’
8-K and 10-Q
SEC filings,
looking for
financial
statement
‘soft
spots.’ ”
The blog,
run by David
Phillips, a
financial
statement
analyst,
features
several
posts a
week,
including
investment
news,
opinions,
trading
alerts and
stock
alerts.
There are
also links
to financial
Web sites,
corporate
governance
news,
educational
sites and
other
investment-related
blogs.
—Megan
Pinkston |
|
39 Free QuickBooks Online Tutorials ---
http://fitsmallbusiness.com/free-quickbooks-online-tutorials/
Thank you Crystalynn Shelton and Kristian Rivera --- |
http://fitsmallbusiness.com/category/accounting/
Small Business Helpers from Smart Stops on the Web
Journal of Accountancy, December 2007 ---
http://www.aicpa.org/pubs/jofa/dec2007/smart_stops.htm
“A”
FOR ADVICE
www.sba.gov/services
Whether you’re a
CPA with small
business or sole
proprietor
clients or
you’re
interested in
leading your own
firm, the Small
Business
Administration
is here to help.
This Smart Stop
offers free
online training
in business
planning and
management,
marketing and
advertising,
federal taxes,
compliance and
cyber security.
Prepare for the
future with
guidance on
disaster
planning,
contract
opportunities
and loan
eligibility.
Looking for a
more personal
experience? Use
the site to
locate the
nearest Small
Business
Development
Center or
Women’s Business
Center.
PLANNING FOR THE
FUTURE
www.finance.cch.com/tools/calcs.asp
With plenty of
day-to-day
responsibilities,
it’s hard for
small business
owners to step
back and look at
the big picture:
their financial
future. Take
some time to use
CCH’s Financial
Planning
Toolkit, which
provides
resources on
commercial
loans, working
capital and
profit margins,
as well as
dozens of
calculators for
debt management,
investments, tax
and personal
finance. Click
on “Planning
Guide” and
“Planning Tools”
for guidance on
risk management,
taxes,
retirement and
estate planning,
including “Ages
and Stages
Approach to
Investing” and
“Tax Year and
Accounting
Methods.”
GET SMART
www.tutorials.com
This site
delivers how-tos
for life and
work right to
your desktop.
You can purchase
courses that
help you master
a computer
program, build a
Web site or
learn how to
negotiate
successfully.
Its skills
training
offerings
include series
of courses on
sales and
organizational
development,
personal finance
and Internet
marketing. Free
offerings
include
step-by-step
guides ranging
from the
everyday—how to
clean your
computer or how
to remove
spyware—to the
workday—how to
identify your
customers or
choose office
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|
Human Resource Calculators (cost of employee turnover, productivity losses,
relocation losses, etc.) ---
http://www.hrworld.com/calculators/badhire/
The home page for human resource management is at
http://www.hrworld.com/
Bob Jensen's links to calculators ---
http://faculty.trinity.edu/rjensen/Bookbob3.htm#080512Calculators
From Smart Stops on the Web,
Journal of
Accountancy, July 2007 --- http://www.aicpa.org/pubs/jofa/jul2007/news_web.htm
SCORE SMALL BUSINESS ADVICE
www.score.org Since its first appearance here in June 2003, the SCORE
Association site has expanded its e-mail counseling
service to include 1,300 volunteer counselors, ready and
willing to give unbiased and confidential business
advice to small-firm CPAs and sole practitioners. Click
on “Ask SCORE” to receive Web-based advice or type in
your ZIP code to find a local office. For general
business questions, browse for quick answers on the “Top
5 Tips” or “60 Second Guides” pages. |
|
"Smart Stops on the Web," Journal of Accountancy,
January 2008 ---
http://www.aicpa.org/pubs/jofa/jan2008/smart_stops.htm
PERSONAL FINANCIAL
PLANNING |
|
CENTER IN ON PFP SERVICES
http://pfp.aicpa.org
Want to offer financial
planning services to your
clients? Visit the AICPA’s
Personal Financial Planning
Center for PFP resources to
get you started. Click the
“Events” tab to register for
Web seminars, including “The
Mathematics of Estate
Planning” on Jan. 16, or
research the requirements
and application process for
the Personal Financial
Specialist credential. In
the upcoming months, the
section’s Executive
Committee will roll out a
suite of updated practice
guides on various PFP
technical and practice
management topics, available
to PFP Section members and
PFS credential holders at no
cost.
STRAIGHT FROM THE SOURCE
www.treasurydirect.gov
Individuals and financial
institutions can buy and
redeem Treasury securities,
including bills, notes, TIPS
and series I and EE savings
bonds, directly from the
U.S. Treasury at this Smart
Stop. Not confident enough
to invest yet? Enter the
“Individuals” or
“Institutions” sections, and
then use the “Research
Center” to access a glossary
of terms and in-depth
coverage of auctions and
products or to take a guided
tour of the site. There is
also a calendar of upcoming
Treasury auctions, as well
as auction regulations and
recent results.
STAY DEBT-FREE
www.moneycrashers.com
At this “Guide to Financial
Fitness,” author Erik
Folgate chronicles his
experience with getting into
and out of debt, providing
recent graduates and young
professionals with the
education needed to be
financially successful.
Follow the “11 Principles”
series, which includes tips
on saving money for the
unexpected and creative ways
to boost your income, or
read articles on financial
planning, such as “Don’t Let
Your Fears Stand in the Way
of Investing” and “Stay
Positive When Paying Off
Debt.” |
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GENERAL INTEREST |
|
ERISA EDUCATION
www.dol.gov/elaws/ERISA/Fiduciary.htm
Developed by the Employee
Benefits Security
Administration, this site’s
fiduciary adviser provides
an overview of the basic
fiduciary responsibilities
applicable to private-sector
retirement plans under the
Employee Retirement Income
Security Act (ERISA).
Designed for accountants and
other third-party service
providers, the adviser uses
a series of questions to
determine whether a
retirement plan falls under
ERISA requirements, and if
so, what they are. This
Smart Stop also has a
comprehensive listing of
ERISA resources at
www.dol.gov/elaws/ebsa/fiduciary/resources.htm.
FLY HAPPY
www.yapta.com
Whether you’re planning a
vacation months in advance
or jetting off for a
last-minute business trip,
use Yapta as “Your Amazing
Personal Travel Assistant.”
Registered users tag their
desired or frequently
traveled flights, then are
alerted by e-mail when the
prices of those routes drop.
Already bought a ticket? If
you booked through an
airline’s Web site, submit
your confirmation code or
forward Yapta your
confirmation e-mail. If the
ticket price drops below
what you paid, the site will
let you know whom to call
and what to say to receive a
refund for the difference or
a travel voucher.
STUDENT INSIDERS
http://njscpa.typepad.com/examcram
What does it take to become
a CPA these days? Follow a
few New Jersey Society of
CPAs student members, who
are chronicling their
trials, tribulations and
triumphs on the society’s
Exam Cram blog. Browse the
archives to read Scott
Sandford’s journey as he
studied for and took the CPA
Exam while working at
Deloitte, or join the
NJSCPA’s new student
recruit, Priscilla Jenkins
of Merrill Lynch & Co. in
Pennington, N.J., as she
sits for part of the exam in
February. Also take some
time to read Tomorrow’s CPA,
a monthly
e-newsletter for accounting
students, written by
accounting students, on the
NJSCPA’s Students and
Educators site (www.njscpa.org/students).
GO GLOBAL
www.jimhamiltonblog.blogspot.com
Jim Hamilton, a principal
analyst at Wolters Kluwer
Law & Business and a leading
contributor to the CCH
Federal Securities Law
Reporter, emphasizes
SEC rulemaking,
international, federal and
state regulations, and
industry trends on his
“World of Securities
Regulation” blog. Under
“Tools,” click “Posts by
Topic” for a complete
listing of the blog’s
auditing, financial
reporting, Sarbanes-Oxley
and PCAOB coverage, or look
for new posts on
principles-based
regulations, the mortgage
lending market and
international issues.
—Megan Pinkston |
A Government Website for Helpers
in Personal Finance
MyMoney.gov is the U.S. government's
website dedicated to teaching all
Americans the basics about financial
education. Whether you are planning to
buy a home, balancing your checkbook, or
investing in your 401k, the resources on
MyMoney.gov can help you do it better.
Throughout the site, you will find
important information from 20 federal
agencies government wide.
My Money.gov ---
http://www.mymoney.gov/
The AICPA's Financial Literacy Helper
Site ---
http://www.360financialliteracy.org/
Bob Jensen's finance helpers ---
http://faculty.trinity.edu/rjensen/Bookbob1.htm
From "Smart Stops on the Web," Journal of Accountancy, August 2007 ---
http://www.aicpa.org/pubs/jofa/aug2007/news_web.htm
CUTTING EDGE
www.smallbusinessedge.com Both seasoned owners and potential entrepreneurs toying with the idea of
opening a small business can use this Smart Stop to learn how to start,
manage and grow a small business—or save one that’s in trouble. The
site, home to Small Business Success, Leader, Urban Success and
Winning Bids magazines, provides articles and resources on
small biz financing, sales, marketing and technology, plus access to
resources from its partners, including the Small Business Association,
Inner City Economic Forum and the Association of Small Business
Development Centers.
|
HUMAN RESOURCES |
|
EASY DOES IT
www.simplyhired.com Many of us may not consider a job search “a simple yet effective,
enjoyable journey,” but that’s exactly what the creators of this
vertical employment search engine strive to provide. The site
features millions of positions fed from thousands of job boards and
HR sites. You can easily refine searches by job type, work
experience, education and date posted with a single click of your
mouse. Through partnerships with Working Mother, Care2 and
RetirementJobs.com, to name a few, the site offers specialty
searches that limit results to mom-, eco- and 50-plus-friendly
companies, respectively.
UNCLE SAM IN YOUR OFFICE
www.workplacefairness.org Brush up on your legal rights regarding whistleblowing, privacy and
non-competition agreements, plus a host of other employment laws, at
this site from nonprofit group Workplace Fairness. It presents
information, resources and publications on employee rights—free of
legal jargon—at the state and national level. Check out “The Issues”
tab, which tracks high-interest topics of healthcare, retirement and
work/life balance, or click on “Features” to sign up for the group’s
two e-newsletters, Workplace Week and In the News.
TAP THE TAX COMMUNITY
www.taxtalent.com As a portal for tax professionals looking for tax positions,
employees, training events and career management information, this
site is a Smart Stop for all members of the tax sector. Looking for
a mentor or protégé? How about a local tax conference? Visit the
“Career Tools” page for access to the mentor forum or to search tax
events by specialty, date or location. Employers can search resumes
to fill permanent or contract positions, post job listings or
request a salary benchmark survey, which provides a view of the
current compensation landscape, to use when setting compensation
policies, hiring or creating new positions.
A BETTER WAY TO WORK?
www.culturerx.com This site is the home of work force management initiative ROWE, or
the Results-Only Work Environment. In this result-oriented work
style, founded by former Best Buy employees Jody Thompson and Cali
Ressler, workers “do whatever they want whenever they want as long
as the work gets done.” Under the program, employees are not judged
on how they spend their time, but only evaluated on the end result,
eliminating what Thompson and Ressler define as “sludge, or any
negative language in the workplace that is used to cast judgment,
place guilt or add stress.” |
"Small Business Survival Index
Released," AccountingWeb, November 13, 2006 ---
http://www.accountingweb.com/cgi-bin/item.cgi?id=102782
The Washington-based
Small Business & Entrepreneurship Council (SBEC) released their 2006
small-business survival study last week. The Warren (Ohio) Tribune Chronicle
reports their results compare states for the tax, spending, regulatory and
litigation burdens, according to the council’s chief economist Raymond
Keating.Small businesses and the spirit of entrepreneurship are important for our
economy. Any policies that affect the health and growth of businesses should
be examined more closely for obstacles to this sector’s vitality. According
to the Small Business Survival Index, some of the contributions of small
businesses that make them the backbone of our economy are listed below:
-
99.9 percent
of all U.S. businesses have fewer than 500 employees, while nearly
17,000 businesses employ greater than 500.
-
Small
companies can account for more than 50 percent of nonfarm private GDP.
-
Small firms
created 1,990,326 net new jobs, while larger firms employing over 500
lost 994,667 net jobs.
-
Small
businesses also produce 13 to 14 times more patents per employee than
larger firms and the patents are more likely to be in the top one
percent of the most cited patents.
The Index saw three
new measurements added in 2006, according to the SBEC. Two
government-spending indicators and another that examines how each state
protects private property were added, according to Tribune Chronicle. The
SBEC’s home state of Ohio came in at number 37 in the state ranking by tax
burden, while the top ten were geographically diversified:
-
South Dakota
-
Nevada
-
Wyoming
-
Washington
-
Florida
-
Mississippi
-
Alaska
-
Alabama
-
Texas
-
Michigan
Their mission
statement found on the SBEC Project Vote Smart web site reads, “The Small
Business & Entrepreneurship Council works to influence legislation and
policies that help to create a favorable and productive environment for
businesses and entrepreneurship. By educating policymakers, legislators, the
media and the public about the critical role that small businesses play in
our economy—and how government actions can positively or negatively affect
the small business community—SBSC strives to establish a solid public policy
foundation upon which entrepreneurial activity and small businesses can
survive and flourish.”
A Helper Site for Starting a New Business ---
http://www.startupnation.com/index.asp
United States Small Business Administration
http://www.sba.gov/
From the NY Public Library Small Business Video Seminar ---
http://www.nypl.org/research/sibl/smallbiz/video.html
The Small Business Knowledge Base at BizMove.com ---
http://www.bizmove.com/
Update on New Business Initiatives
that Do Involve CPAs Following the success last year of its
award-winning "Explode with Growth" Superforum featuring "Dragons’ Den"
entrepreneur Duncan Bannatyne, Ignite Scotland has relaunched its quarterly
Business Builder Forum programme for Ayrshire business people. Ignite Scotland
is the brainchild and offshoot of Irvine-based chartered accountants Robert J
Hart & Co, and has a growing reputation and track record in assisting business
owners achieve enhanced profit performance. "Accountants RJ Hart & Co Demonstrate Ways to Expand Businesses,"
PRWeb,
July 24, 2006 ---
http://www.prweb.com/releases/2006/7/prweb415303.htm
From the Smart Stops on the Web,
Journal of Accountancy, January 2007 ---
http://www.aicpa.org/pubs/jofa/jan2007/news_web.htm
The Health Benefits Adviser
www.dol.gov/elaws/ebsahealth.htm
This Web site of the U.S. Department of Labor’s Employee Benefits
Security Administration has all the information employees and employers need
to know about federal laws related to workforce health benefits. There are
discussions on COBRA continuation health coverage, a glossary of benefits
terms and guidance for employees on Medicare eligibility. Publications
offers 10 ways to make your health benefits work for you with a detailed
review of your coverage.
Get the Word Out
www.givetogetmarketing.com
Business marketer Joe Gracia’s home on the Web offers entrepreneurs and
small businesses hundreds of marketing tips. Read advertising case studies,
get low-cost promotional ideas and tips for writing attention-grabbing
headlines. Find five ways to attract Web visitors, read marketing myths and
get tips from David Letterman and Jay Leno on how to grow your sales.
Cybersafety First
www.staysafeonline.org
Is your PC secure from threats? This site’s self-assessment quiz will show
just how safe your computer is. Get eight cybersecurity best practices,
links for protecting your children when they’re online and tutorials on
cybersecurity and data recovery for small businesses. Research business
cases on computer security in accounting firms and manufacturing companies
and access self-assessment guides and checklists.
Go to the Guru
www.actionplan.com
Marketing strategist Robert Middleton shares tactics for getting
your business noticed at his Web site. Register for the 24-page marketing
plan workbook and information on how to attract new clients, develop a core
marketing message and write an executive summary for your business.
From
Smart Stops on the Web, Journal of Accountancy,
March 2006 --- http://www.aicpa.org/pubs/jofa/mar2006/news_web.htm
SMALL
BUSINESS SITES |
|
Be Your Own Boss
www.abcsmallbiz.com
CPAs thinking of going out on their own should bookmark this URL for
start-up basics including information on Small Business Administration
funding and venture capital. Find a nine-part series on how to write a
winning business plan, links to state business assistance e-stops and a
hiring checklist. Money Matters has articles on home-office deductions
and tax planning. For lighter fare read the Funny Pages.
Small Biz Banter
www.businessforum.com
Read commentaries and case studies on cash management, corporate
governance and Sarbanes-Oxley at this Smart Stop. Also find articles on
banking, family-owned businesses, fraud and security, the 2004
Securities Class Action Filings Study and a six-part series on women
business owners. Small and emerging companies can find IT answers and
virus update alerts.
Start-Up Basics
www.businesstown.com
CPAs advising entrepreneurs and small business owners can find
information on credit and collections, projections and purchasing and
cost control in the accounting link at BusinessTown’s home page. Each
category has links to articles, a featured book and related Web sites.
Other sections offer a business loan glossary, business plan templates
and overviews on corporations, partnerships and sole proprietorships.
Spotlight on the
Soloist
www.fortune.com/fortune/smallbusiness
CPA sole practitioners and small business advisers can find free
articles from Fortune Small Business here. Topics include
building business back up after a disaster, the winners of Fortune’s
student business-plan contest and entrepreneur profiles. The site also
offers a start-up resource guide and a list of the top 50 small-cap
stocks.
Templates and
Tools
www.morebusiness.com
This Web stop offers entrepreneurs information on everything from
raising capital to retirement planning. The Templates section includes
sample business and marketing plans and checklists on buy/sell
agreements and data warehousing. Business How-Tos gives visitors tips on
building their own Web sites and marketing their services. Also check
out the site’s large collection of financial calculators to estimate the
alternative minimum tax and estate tax, car lease payments and long-term
investment yields. |
"Small Business Software Grows Up: Intense efforts for product
improvements, by J. Carlton Collins, The Journal of Accountancy, March
2006 ---
http://www.aicpa.org/pubs/jofa/mar2006/collins.htm
EXECUTIVE SUMMARY |
Microsoft’s introduction
this year of its small business accounting software is
challenging the two leading competitors—QuickBooks and Peachtree—to
step up their efforts with products that are ever-more
technologically powerful.
The competition will be
intense because “Microsoft Small Business Accounting (MSBA) is
technologically more advanced than either QuickBooks or Peachtree
and its price strategy is hard to beat: It’s bundled free in
selected 2006 versions of Microsoft Office. With more than 400
million users of Microsoft Office worldwide, even if only a small
percentage of them upgrade to the 2006 version, the new accounting
program could be in the hands of millions of users by the end of the
year.
With products as complex and
customizable as SBA software, it’s not prudent to rely fully on
assessments of reviewers or colleagues. The only way to be sure a
product works best for you or a client is to test it with your own
accounting data.
If you’re going to buy
QuickBooks or Peachtree, purchase the accountant’s
editions. They contain nearly all the additional functionality found
in the various other versions of the product and they’re typically
priced lower.
The stakes in the competition
for small business accounting software are high. The
current estimated market of small businesses is between 15 million
and 25 million, with 500,000 to 2 million new businesses starting
each year. Clearly, small businesses will be the winner as their
accounting tools continue to improve. |
Bob Jensen's threads on accounting software are at
http://faculty.trinity.edu/rjensen/Bookbob1.htm#AccountingSoftware
Employment Law ---
http://www.lawmemo.com/
Law & Legal Research Center -
http://www.cpanet.com/up/s0210.asp?ID=0575
FindLaw -
http://www.cpanet.com/up/s0210.asp?ID=0576
Legal Professional Site Links ---
http://www.chooselaw.com/
Center for Science in the Public Interest ---
http://www.cspinet.org/
Bob Jensen's threads on law and legal
studies ---
http://faculty.trinity.edu/rjensen/Bookbob2.htm#Law
From Smart Stops on the
Web, Journal of Accountancy, November 2006 ---
http://www.aicpa.org/pubs/jofa/nov2006/news_web.htm
HUMAN
RESOURCES SITES
Staff Smart
www.adphire.com
CPAs responsible for filling open positions will want to check out Automatic
Data Processing Inc.’s (ADP) Web site for its calculator that determines the
cost of a bad hire and of high turnover. The site also offers free
information on screening candidates and adhering to compliance rules for
background credit and criminal records checks. Register for free to get
ADP’s Smart Hire newsletter and to access articles in the HR Library.
On the Boards
www.citehr.com
If you’re looking for guidelines and tips on human resources topics, sign up
for free at this Web stop to access the discussion boards. The Human
Resources section covers topics such as compensation and benefits,
motivation and improvement, knowledge management, payroll, HR software
options and staffing. Read questions and responses from professionals in the
field worldwide.
HR Know-How
www.hrconsult.com
This Florida-based company’s home on the Web features free monthly articles
on the new role of the HR professional, how to get the best performance out
of your team and whether flex-time is the answer to attract, recruit and
retain talent. Subscribe for free to the HR Times e-newsletter or
click on Links for benefits and compensation, compliance, labor law and
recruiting resources.
Succeed at Succession
www.managementhelp.org
In addition to a general Human Resources Management section, this Smart Stop
includes a seven-step succession plan and tips on how to prepare your firm’s
next generation of leaders. The Human Resources Management link has free
online training programs, a field guide for leadership and supervision, and
advice on employment law compliance, personnel policies and employee
training.
It’s All Relative
www.familybizz.net
CPAs who need help with succession planning for their family-owned-firm
clients will be interested in the Family Business e-newsletter, as
well as the article on the seven development stages of succession. Users can
find advice on how to bring in the next generation and case studies on
succession to nonfamily members. Professionals worldwide share their
experiences on working with family-owned businesses in the 60-Second
Interview section.
GENERAL INTEREST SITES
Pound the E-Pavement
www.accounting-employment.com
Whether you’re looking for an entry-level accounting position or a move up
the ladder from your current one, this Smart Stop lets you post your resume
and search full- or part-time job listings from Fortune 1000
companies and in forensic and government accounting. Users can link from
this site to Worktree.com, where there are articles on how to write a
winning cover letter and resume, 13 interview mistakes to avoid and how to
negotiate a salary increase.
A Collaborative Effort
www.wikicpa.com
If you’re a CPA with tips on how to better the quality of your work, then
share them here. This knowledge repository lets registered users post
articles on accounting topics including attestation, business law, ethics,
taxation and technology. Research or add definitions to a glossary of
accounting terms and download articles such as one with seven
fraud-prevention tips.
Come Blow Your Horn
http://ideasiteforbusiness.com
Find out whether your current marketing plan needs an overhaul here. Sole
practitioners and small-firm marketers can get ideas and guidance here on
how to advertise their services. Learn the pros and cons of employing
captioned cartoons and comic strips, read detailed discussions on how best
to use print ads, or create an eye-catching corporate logo and an on-target
brochure.
Big Advice for Small
Businesses www.fryarmg.com
The Fryar Management Group’s Web site offers accounting, tax and general
business advice for small firm owners. There’s a free newsletter with
guidance on avoiding identity theft, estate tax facts, retirement fund
options and how-tos for shifting investment income. The Finance and Paycheck
Calculators can determine loan payments and retirement income. The Tax
Center has links to a state refund tracker and a tax due date calendar.
Plan Tomorrow Today
www.lifesbridge.com
Retirees trying to answer the question, “What do I do now?” can get expert
advice from retirement planner and coach Bruce Macdonald at his Web spot.
Sign up for the free Age of Fulfillment e-zine, with discussions on
what to do if you suddenly find yourself single at retirement, whether
marriage and retirement mix and how to navigate the emotional ebb and flow
of having too much free time.
From Smart Stops on the Web, Journal of
Accountancy, September 2006 ---
http://www.aicpa.org/pubs/jofa/sep2006/news_web.htm
CAREER BUILDING SITES
Value for Your Business
http://bvfls.aicpa.org
The AICPA’s Business Valuation and Forensic Litigation Services Center
offers members case studies on fraud schemes, a practice management toolkit
and a definition of the month. Read the full text of an exposure draft on
valuation service standards and get tips on how to conduct an inquiry
interview or an interview with a CEO or CFO. Help your clients develop
internal controls with a risk management checklist and a list of common
auditing deficiencies.
Answers for Accountants
www.forensicaccounting.com
CPAs interested in switching to investigative and forensic accounting can
get an overview here from Alan Zysman, CA and certified fraud examiner, of
Toronto’s Zysman Forensic Accounting Inc. His to-the-point e-site offers a
detailed explanation of what it takes to become a forensic accountant and
how to approach assignments. Also get an overview of investigative
accounting and litigation support.
A Valuable Site
www.bvresources.com
Looking for information and news on business valuation? Visit this Web stop
for BVWire, a free weekly update with the latest valuation court cases,
practice tips, a definition of the week and questions and answers on
valuations of start-ups. There’s also free downloads of IRS BV guidelines,
an international glossary of terms and free issues of the newsletter Business Valuation Update,
as well as links to other BV associations
such as the AICPA and the Appraisal Foundation.
What’s It Worth?
www.cbiz.com
The e-calculators here can help you determine cash flow, financial ratios
and business valuation as well as estate tax, retirement planning,
investment returns and 401(k) savings. The Tax section has a 1040 calculator
and the Tax Planning Update newsletter offers advice on how to
reduce estate taxes and draft buy-sell agreements. Users also can get
marketing tips and links to franchise and small business opportunities.
M&A How-Tos
www.mergerplace.com
Free membership to this e-stop gets CPAs and their entrepreneurial clients a
valuation guide with tips on business appraisals and pitfalls associated
with them. Users can find a due diligence checklist, simple- and long-form
nondisclosure agreements and a buyer profile. The Resource Center offers the
M&A Advisor with archived articles on e-mail strategies during an
M&A, “Lessons for Dealmakers” and tips on small business valuations.
Business Planning Tools includes sample business and marketing plans and
e-calculators to determine cash flow and start-up costs.
Tips for Tenderfoots
www.tannedfeet.com
Whether you’re starting an at-home business or just need a refresher course
on the rules of the game, this entrepreneurs’ e-page offers checklists for
starting a business, marketing plans, tips on how to write a contract and
small business tax deductions you may be able to claim. Visitors also can
find articles, links and discussions on immigration law and intellectual
property, and advice on buying, building or leasing office space. Get a
laugh or two in the Business Humor section as well.
Private Sector Development ---
http://psdblog.worldbank.org/psdblog/
The Global Technology Revolution 2020 ---
http://www.rand.org/pubs/technical_reports/2006/RAND_TR303.pdf
An Agenda for Harnessing Globalization ---
http://www.brookings.edu/views/articles/fellows/ghani20060901.pdf
Small Business Helpers from Smart Stops on the Web,
Journal
of Accountancy, March 2005 --- http://www.aicpa.org/pubs/jofa/mar2005/news_web.htm
Food for Thought
www.businessownersideacafe.com
“A fun approach to serious business” is the tag line here,
with lively graphics and laid-back narrative that punch up its material. The
Small Biz Tax Center helps clarify IRS tax and recordkeeping requirements and
gives tips for start-up business owners. The CyberSchmooz “lobby” opens
onto message forums on e-commerce, marketing and working at home. The Your Biz
section includes a “fridge” full of business forms, e-mail protocols,
marketing tips and even yoga instructions.
Small Company, Big Resources
www.allbusiness.com
From forms for consulting and confidentiality agreements to
advice on sales and marketing or using the Internet, this Web stop offers
guidance to CPAs who advise start-ups and small businesses. The Business Plans
section has articles such as “Common Business Plan Mistakes for Startup
Companies,” while the Small Business Advice section provides tax basics.
Users also can tap into an FAQ section or a business glossary or sign up for a
free e-newsletter.
A Dear Abby for Small Business
www.score.org
Since first listed here in June 2003, this site has added
resources to its Business Toolbox section including a gallery of downloadable
templates for bank loan applications, business plans and sales forecasts, as
well as expanded links to such small business topics as finance, franchising
and international trade. The Learning Center has a list of tips for business
planning, marketing, public relations and office management.
Acronym Search ---
http://www.acronymsearch.com/
Hyperology ---
http://snipurl.com/Hyperology
This site features a lot of things including coverage of tax and 401K/IRA
deductions.
Tips on how to deal with the new Bankruptcy Bill ---
http://talkingpointsmemo.com/bankruptcy/
Entrepreneurialism ---
http://entrepreneurialism.group.stumbleupon.com/
Guides for Employers
from Smart Stops on the Web, Journal of Accountancy, June 2005, Page 33 ---
http://www.aicpa.org/pubs/jofa/jun2005/news_web.htm
For employee benefits, see
http://www.aicpa.org/pubs/jofa/jul2005/news_web.htm
Worldwide Directory of Accountants and Consultants ---
http://www.searchsystems.net/list.php?nid=62
Museum of American Finance ---
http://www.financialhistory.org/
Bob Jensen's helpers on how seek professional advice ---
http://faculty.trinity.edu/rjensen/fees.htm
A Family Affair (Helpers for Family Businesses)
www.family-business-experts.com
Web Site Development Tools for Small Business While a custom e-commerce
solution will always make you happier, it takes time and resources to create.
What should a small business owner do when he or she is in short supply of both?
http://www.newmedia.com/default.asp?articleID=3568
Shopping Cart Options for Small Business This column's topic is on the
exciting, hurly-burly world of shopping cart software.
http://www.newmedia.com/default.asp?articleID=3556
Middleware: The Next Great Frontier When it comes to thinking about what may
be the most important class of technology for the next 10 years, none other than
middleware (and the advances being made in it) immediately comes to mind.
http://www.newmedia.com/default.asp?articleID=3566
From the AccountingWeb on December 28, 2004
BOOK RECOMMENDATION: Keeping the Books: Basic Record Keeping & Accounting for the Successful
Small Business, by Linda Pinson * * * * * * * * * * * * * * * * * * * *
* *
This introductory guide offers advice on choosing an
accounting method, developing a chart of accounts, organizing recordkeeping,
and interpreting the records later. A glossary of accounting terms, a list of
business resources, and sample forms are also included. Most entrepreneurs
enter new ventures because they know something about products or retail or
sales and marketing. Despite a burning passion for their new businesses,
entrepreneurs will not succeed unless they learn to keep their financial
records in order. http://www.amazon.com/exec/obidos/ASIN/0793179297/accountingweb
June 22, 2006 message from Wendell Gingerich
[wgingerich@gobignetwork.com]
I just wound up on your site and noticed you had
some links to other "venture capital resources".
I was wondering if you could include my site in
there. (If it helps, I found your link page at
www.trinity.edu/rjensen/Bookbob3.htm
)
Go BIG Network
http://www.goBIGnetwork.com
We're the largest on-line network of small
businesses, startup companies and investors. I figured it might be a nice
fit.
Let me know if that works - I'd appreciate it!
Thanks, Wendell Gingerich
Go Big Network
Business and Industry Sites from the Smart Stops on the Web,
Journal of
Accountancy, September 2004, Page 21 ---
http://www.aicpa.org/pubs/jofa/sep2004/news_web.htm
Plan for Change
www.boozallen.com
CPAs, CEOs and CFOs can visit this business strategy
consulting company’s Web site and download the “Ten Guiding Principles of
Change Management” for strategies and tips on managing change within an
organization. Users also can read free articles such as “Reducing Overhead
Costs Is Still the Top Priority for Chief Financial Officers” and get a free
issue with a subscription to the online version of Booz Allen’s monthly
magazine, Strategy+Business.
Resources for Women
www.women-21.gov
Female professionals who visit this e-stop will find
helpful links to employment tax forms and tax tips from experts at the
Department of Labor and the IRS, to name a couple. The site also features
business development resources on expanding and financing a business, training
and counseling.
Expert Advice
www.sales-masters-world.com
CPA firm owners looking to share advice about
conferencing, Internet marketing and investment and financing matters with
other practitioners can register for a free membership to this e-site. All
visitors can find articles such as “Sarbanes-Oxley Requirements Remain a
Wild Card for Outsourcers.”
Meet Ms. Sarbox
www.sox-online.com
In addition to links to the full text of the
Sarbanes-Oxley Act of 2002 and corporate governance e-stops, CPAs who visit
this light-hearted Web site can find a compliance checklist for nonprofits and
charitable foundations, read cartoons and jokes and play the Jeopardy-style
Sarbanes-Oxley game with categories including new disclosure and officer
certification. Users can read articles from Ms. Sarbox’s private collection
on related topics including accounting, auditing and legal concerns.
Are You Ready Yet?
www.ndsweb.com/spotlights/sarbox_overview.shtml
Compliance officers visiting this site can find an
overview of Sarbanes-Oxley, definitions of related terms, a series of
questions to assess clients’ compliance readiness and a best practices list.
There also are white papers entitled, “Focus on Critical Business Processes
to Drive Rapid Application Deployment” and “Uncovering Hidden Liabilities
and Predicting Revenue Drag in Mergers and Acquisitions.”
Take a Tip
www.botinternational.com/sox.htm
CPAs interested in information on streamlining office
processes and meeting risk-management requirements can visit this Web site to
read white papers such as “Establishing a Continuous Improvement Culture to
Improve Project Results” and “The Sayings of Confucius and the Art of
Project Management Processes” as well as current and archived tips of the
week back to 2002.
Get on a Roll
www.nationalpayrollweek.com
This e-stop reminds U.S. wage earners that National Payroll Week begins
September 6 with special sections on how to mark the occasion at your office
and links to video clips and print files of media coverage. Regular site
features include Managing and Maximizing Your Paycheck, with information on
using direct deposit and on personal finance. Other areas offer retirement
planning and savings calculators.
Smooth Office Relations
Do you work for a monster of a boss or have to share a project
with a mean-spirited coworker? If so, register for free at these two Web sites
and shore up interpersonal skills:
www.workworries.com
With more than 1,200 links to articles such as “Being Cool When the Boss
Is Not” and “20 Ways to Deal With Difficult People,” as well as human
resources survey results from the Chubb Group of Insurance Cos., this stop
offers a variety of information on handling problem personalities.
www.badbossology.com
This site has entire sections devoted to “bad boss
behaviors”—bullying, incompetence, harassment and discrimination,
inadequate compensation, disrespect of rights and privacy invasion—and
general solutions and advice for dealing with them.
Smart Stops on the Web,
Journal of Accountancy,
November 2003, Page 29 --- http://www.aicpa.org/pubs/jofa/nov2003/news_web.htm
Research These Resources
www.brook.edu
The Brookings Institution’s spot on the Web includes links to
articles, papers and transcripts on topics of interest to CPAs including
business, domestic and global economics, education and governance. Users can
read the articles “What’s Ahead After the GDP’s Big Surge” and “The
Budget Outlook: Analysis and Implications,” to name a few.
Bob Jensen's threads on business valuation and ROI are at
http://faculty.trinity.edu/rjensen/roi.htm
"A Good Deal Depends on Preparation," by Rod P. Burkert,
Journal
of Accountancy, November 2003, pp. 47-56 ---
http://www.aicpa.org/pubs/jofa/nov2003/burkert.htm
Resources Revisited
www.bvresources.com
First listed as a Smart Stop a year ago this issue, this Web site still
offers CPAs and business valuation (BV) professionals all the features they
have come to expect, such as its BVLibrary, definition of the week, online
forums, and gratis articles and downloads. Now it also includes a free
section, Shannon’s Tip of the Week, by Dr. Shannon Pratt, who established
the Business Valuation Update newsletter available online or in print
for a fee.
Tools to Start or Sell Your Business
www.toolkit.cch.com/text/p06_7100.asp
CPAs advising clients who want to start their own companies—as well as
small business owners looking to sell—can visit this e-stop for financing
and legal information, market and profitability assessments and links to
checklists, financial spreadsheet templates, IRS tax forms and model business
documents. Users with specific questions can “Ask Alice!” the site’s
advice columnist, or visit her frequently asked questions section.
Find the Value of a Business
www.spardata.com
The Web stop of this Annapolis, Maryland-based BV company offers clients
and financial advisers free over-the-phone consultations, links to databases
of firms that buy and sell public limited partnership interests and audio
tutorials on valuation topics for business owners. Visitors also can link to
free articles, such as Inc.’s “What’s Your Company Worth
Now?” and get a complimentary adviser information kit.
E-qual Opportunities
www.accessamerica.org
This Smart Stop, sponsored by the U.S. Chamber of Commerce,
“fosters strategic alliances and investments for women and minority-owned
business leaders and entrepreneurs” with webcasts such as “Advancing the
American Economic Agenda.” The Small Business Center allows registered users
free three-day access to offerings such as articles, research and statistics
and the members-only weekly newsletter
Register Here to Testify
www.experts.com
CPAs looking to become—and lawyers looking for—expert witnesses can do
both at this Web site. Users can read the titles “The Art and Science of
Expert Witnessing” and “The Correct Way to Present Exhibits,” to name a
few, and witnesses who register for a fee with the site can submit their own
articles.
An Expert Site
expertpages.com
CPA expert witnesses can advertise their services here. Witness seekers can
search by category and location. Also, registered expert witnesses can post
topical articles, such as “Full-Time Professional and Part-Time Expert”
and “Selecting and Retaining Experts,” as well as receive a free
newsletter.
From Smart Stops on the Web, Journal of Accountancy, March 2004 ---
http://www.aicpa.org/pubs/jofa/mar2004/news_web.htm
Advice for the Little Guy
www.realsmallbusiness.com
CPA small firm owners will want to drop by this Web site for
advice on building and marketing a business and managing staff, for example.
Recently posted articles include “10 Ways to Help Increase Your Cash
Flow.” Other resources offer users guidance on preparing a business plan and
recordkeeping basics.
A Resource for Loans
www.smallbusinessloans.com
For CPAs starting their own small businesses, or advising
clients doing the same, this Web stop supplies information on government grant
applications and Small Business Administration loans, as well as articles such
as “How to Use Other People’s Money for Your Business.” The Small
Business Center offers detailed expert advice on building, promoting and
managing a business.
Free Start-Up Information
www.madeforsuccess.com
This Web site gives entrepreneurs and other small business
owners much food for thought about, for instance, communication, leadership,
marketing, networking and time-management topics. Visitors can register for
free reports such as “Ensure Your Financial Future” and a gratis
newsletter.
A Capital Site
www.bizplanit.com
Need ways to advise your clients how to grow their businesses
into investor-worthy enterprises? Visit the free resources section at this
site and peruse the virtual business plan, subscribe to a free newsletter and
read articles including “How to Prepare a Business Loan Request for Your
Bank.” Find links to Web sites for franchising, funding, government programs
and legal and minority resources, and lists of business planning books or
software for purchase.
Research Hiring Out
www.outsourcing-center.com
In addition to its general outsourcing information—for
example, articles on best practices, legal and offshore outsourcing
trends—this Web site offers registered users free access to white papers and
all visitors online publications such as Outsourcing Journal on the
topic.
Business helpers from Smart Stops on the Web,
Journal of Accountancy,
June 2005 ---
http://www.aicpa.org/pubs/jofa/jun2005/news_web.htm
Guides for Employers
www.hr-guide.com
CPA firm owners and/or human
resources managers can find many useful links to
incentive plans, job evaluations, performance
appraisals, and staffing and training and
development information. There are links to articles
on avoiding sexual harassment claims and
accommodating the disabled, as well as sample
benefit and salary surveys and demos of HR software.
www.winningworkplaces.org
Visitors can read articles on
workplace discrimination and recruitment, research
studies on women of color in corporate management
and tool kits on creating diversity in the workplace
and other topics at this Web stop. Users can
subscribe to the free newsletter Winning
Workplace Ideas from the Forum link on the home
page.
www.whenworkworks.org
This site, which focuses on 21st
century office trends, offers case studies and tips
on employee retention and flexible work schedules, a
communication checklist for workers, suggestions for
implementing flex-work programs and research
findings. |
|
July 24, 2006 message from Wendell Gingerich
[wgingerich@gobignetwork.com]
I just wound up on your site and noticed you had
some links to other resources for entrepreneurs.
I was wondering if you could include my site in
there.
Go BIG Network
http://www.goBIGnetwork.com
We're the largest on-line network of small
businesses, startup companies and investors. I figured it might be a nice
fit.
Let me know if that works - I'd appreciate it!
Thanks, Wendell Gingerich
Go Big Network
An E-ssential Site ---
http://www.el.com/ CPAs, financial analysts, small business owners, and tax professionals not only
can find links to many Web sites in their fields here, but also can use
Essential Link’s home page to access online calculators, clocks, e-mail
services, encyclopedias and dictionaries. Users can find links to online news,
newspaper and television network Web sites in the Headlines area, as well as
links to Internet search engines.. Bob Jensen's search helpers are at
http://faculty.trinity.edu/rjensen/searchh.htm
A Women's Entrepreneur Site from the U.S. Government ---
http://www.women-21.gov/index2.asp
The growth of women entrepreneurs is one of the most
remarkable features of the American economy as more and more women launch
businesses as their path to professional success. This website offers you key
resources, targeted information, registration for online programs, and
networking opportunities to help build the rewarding career you deserve
From The Wall Street Journal Accounting Educators' Review on March 21,
2003
TITLE: Entrepreneurs' Biggest Problems-- And How They Solve Them REPORTER: Paulette Thomas DATE: Mar 17, 2003 PAGE: R1, 3 LINK:
http://online.wsj.com/article_print/0,,SB104749882695232600,00.html TOPICS: Entrepreneurship
SUMMARY: A special report on small business is offered addressing many of the
issues facing entrepreneurs, particularly small business entrepreneurs. The lead
article by Thomas lists the essentials ingredients for success.
QUESTIONS: 1.) Discuss how important a clear strategy is to the entrepreneur. Relate it to
the article by Bialik about product options. What does flexibility mean in this
context? Relate it to the other article offered by Thomas.
2.) Give examples of the effects of having an unrealistic view. How does a
realistic view impact the related article by Bailey?
3.) What does the author suggest one should do where ethical behavior is
concerned? What does Thomas mean by a robust network and why is this important?
4.) Is a global perspective always appropriate? Argue that it is. Argue that
it might not be. How is an ability to deal with technology important? What does
Thomas mean when she says passion is a necessary component for the successful
small business person?
Reviewed By: Judy Beckman, University of Rhode Island Reviewed By: Benson Wier, Virginia Commonwealth University Reviewed By: Kimberly Dunn, Florida Atlantic University
--- RELATED ARTICLES --- TITLE: How Do You Make Adjustments When Your Market
Dries Up? REPORTER: Paulette Thomas PAGE: R8 ISSUE: Mar 17, 2003 LINK: http://online.wsj.com/article_print/0,,SB104749839851198500,00.html
TITLE: How Do You Survive In a Market Where Size Matters? REPORTER: Jeff
Bailey PAGE: R7 ISSUE: Mar 17, 2003 LINK:
http://online.wsj.com/article_print/0,,SB104749860044888100,00.html
TITLE: How Do You Narrow Your Product Options? REPORTER: Carl Bialik PAGE: R3
ISSUE: Mar 17, 2003 LINK: http://online.wsj.com/article_print/0,,SB104749959790502600,00.html
TITLE: How Do You Sell a Pricey Product In a Thrifty Market? REPORTER:
Jennifer Saranow PAGE: R6 ISSUE: Mar 17, 2003 LINK:
http://online.wsj.com/article_print/0,,SB104749811820326100,00.html
Socratic Method of learning to help both
existing business owners and those wishing to start their own business
New E-Book by Phil Andrews Released by
Authorstreet.com New E-Book by Phil Andrews released by Authorstreet.com. The
Day I Became the CEO of my own Corporation by Phil Andrews uses the Socratic
Method of learning to help both existing business owners and those wishing to
start their own business ask critical questions to help grow their business to
the next level ---
http://www.prweb.com/releases/2006/6/prweb400605.htm
AccountingWEB's Entrepreneur to
Accountant Referral Network (E.A.R.N.) program, matching the accounting and
financial needs of thousands of small businesses with the talent of the
AccountingWEB community. http://www.accountingweb.com/item/39161
-
-
The Securities and Exchange Commission (SEC) and the
North American Securities Administrators Association (NASAA) have announced the
launch of a new Web site designed to provide information about money managers,
financial planners, and other investment advisors.
http://www.accountingweb.com/item/59363
-
- Balancing the Books -- by the Book For primers on small-business
accounting, entrepreneurs can look to the Web and the business sections
of their local libraries
http://www.businessweek.com/smallbiz/content/feb2002/sb2002021_8853.htm?c=bwfrontierfeb05&n=link2&t=email
-
- How-To for Small Biz
www.office.com
-
- The deal gives D&B iMarket's kit of CD-ROM products and Internet
portal, zapdata.com, to provide real-time access to demographic
information for small businesses ---
http://www.eweek.com/a/pcwt0103303/2702787/
- For the Dunn & Bradstreet Small Business Resource Center, go to
http://www.dnb.com/sbs/hmenu.htm
-
- SmartOnLine is a great website for small business planning ---
http://www.smartonline.com/
SmallBusiness.com knowledge sharing at
http://www.smallbusiness.com/cgi-bin/WebObjects/sbsite.woa
- Business Advice Online
http://www.businessadviceonline.org/
- How to do a business plan ---
http://www.sba.gov/starting/indexbusplans.html
- Lycos small business helpers ---
http://www.lycos.com/business/
The Umbrella Project (helpers for starting up a small
business)http://www.umbrellaproject.com/
National Commission on
Entrepreneurship --- http://www.ncoe.org/
- The Young Entrepreneur's Survival Kit
http://www.inc.com/guide/item/0,,CHL2_GDE78,00.html
Accounting Systems Software at
http://www.lib.polyu.edu.hk/electdb/DATAPRO/154-1.htm
Small Business Helpers
http://www.deionassociates.com/hplist/toc.htm
Entrepreneurial Edge
http://edge.lowe.org/
-
Small Business
Mothers' Home Business Network (MHBN)- Homeworkingmom.com
-
SBFocus.com -- The Search Engine for
Small Business
-
SCORE - Service Corps Of Retired
Executives
-
Idea Cafe: The Small Business Channel
-
iVillage Work From Home -
Advice,
message boards, chat, and self quizzes for work at home moms
Online Small Business Workshop
http://www.cbsc.org/osbw/workshop.html
1099 - "the magazine for independent professionals." (Tax,
Personal Finance, Careers, Small Business) http://www.1099.com/
E-Commerce News and Education ---
http://www.ecommercetimes.com/
Resources for consultants ---
http://www.consultingcentral.com/
Find a consultant ---
http://www.consultants-mall.com/
Entrepreneur's Help Page
http://www.tannedfeet.com/index.html For $8.95, you can get the whole Entrepeneurs Help Page downloaded on book
format (including legal forms) --- http://www.tannedfeet.com/html/buy_the_page_.htm
The Small Business Journal
http://www.tsbj.com/
Another interesting PBS television weekly show is Small Business 2000.
The web site is at http://www.sb2000.com/.
One of the more interesting options at this web site is on the Mentors tab.
This is designed to help small businesses in many ways, including overcoming
the massive paperwork for meeting SEC rules on stock offerings of a small
business. The August 29 show featured the U7 form for stock offering
(Click on the Money form for a free download). There are also
videotapes available regarding Access to Money by small businesses. (Click
on the Orders tab.)
What accounting software is being used by small businesses? See
"Inventory Of Online Accounting Efforts Reveals Slow Migration,"
by Kevin Ferguson, Forbes, August 4, 2000 ---
http://www.forbes.com/tool/smallbus/00/jul/0726/feat.htm
Small Business Helpers --- Assessment Tools for
MicrofinancePractitioners --- The SEEP Network
http://www.mip.org/PDFS/AIMS/Learning%20from%20Clients.PDF
Also see Guides @ Inc.com
http://www.inc.com/guide/category/1,7434,,00.html
Free estate planning helpers from a Georgia law firm ---
http://www.scrogginlaw.com/
Smart Communities Network ---
http://www.sustainable.doe.gov/
Federal Depreciation Rates ---
http://www.smbiz.com/sbrl012.html
ABA LawInfo.org ---
http://www.abalawinfo.org/
Your gateway to information on legal topics that
affect your daily life.
How to Build Customer Relationships Online Marketing is not just about
getting an order, it's about getting a customer and keeping them. Nurture your
customer relationships with regular e-mails. With regular e-mails you can build
relationships and gather market intelligence.
http://www.newmedia.com/default.asp?articleID=3275
Bob Jensen's eCommerce threads are at
http://faculty.trinity.edu/rjensen/ecommerce.htm
Cal Berkeley's Labor Research Portal
--- http://iir.berkeley.edu/~iir/library/webguides.html
Web
Guides |
Alternative
Forms of Ownership Resources for workers and firms interested in models for employee
participation and ownership |
Labor
Education A guide to labor studies programs at colleges and universities |
Globalization Resources covering Global trade, employment and environmental
issues |
Labor
Libraries A list of special libraries that focus on labor, along with
selected Full-text print resources on the Internet |
Government A list of United States government, regulatory and legal web
resources that pertain to labor |
Labor
Unions - U.S. The IIR Library's exhaustive list of U.S. unions |
International
Labor Unions Labor unions world-wide, along with international organizations
that address labor concerns. |
Work
and career The Library's guide to employment information and career guides on
the web |
Labor
Culture A selected guides to the art, culture and music of the Labor
Movement |
Bob Jensen's threads on portals and vortals are at
http://faculty.trinity.edu/rjensen/000aaa/portals.htm
|
-
From AccountingWEB Resource Guide on November 16, 2001
Small Business Manager is the affordable,
interconnected financial and business management solution from Microsoft Great
Plains. Designed specifically for small, growing businesses, Small Business
Manager allows you to efficiently input, organize and access the information you
need to drive your business. When you've got greater functionality requirements
than an out-of-the- box accounting solution provides but you're not yet ready
for an elaborate software package, Small Business Manager is your ideal choice.
Visit http://www.greatplains.com/smallbusinessmanager
and register to attend a free online seminar!
A
Wall Street Journal service:
The Wall Street Journal has made some important
changes to its online center for entrepreneurs, formerly known as
startup.wsj.com.
Now called StartupJournal.com, this newly
redesigned site offers you an enhanced collection of information that's
focused on buying or starting a business or franchise.
Among the changes you'll see:
==Improved Navigation== It's more efficient than
ever to find what you're looking for on StartupJournal.com. Our new,
subject-based tabs organize information into useful categories such as
Columnists, Financing, Technology, Franchising and Ideas.
http://StartupJournal.com
For those of you who thought being an entrepreneur
means going it alone, you may be in for a bit of surprise. A new survey
conducted by Accenture over a period of 18 months shows that true and
effective entrepreneurship is really a collaborative effort. Survey results
also show that American business owners are among the least likely to
embrace this theory. http://www.accountingweb.com/item/54038
German
Boer's
useful
information for entrepreneurs For more recent updates, see http://mba.vanderbilt.edu/germain.boer/Creating%20New%20Ventures/mgt754-2001.htm
http://www.sbaonline.sba.gov/
--Small Business Administration home page
http://fisher.lib.virginia.edu/active_data/domestic.html
--Regional economic information
http://www.yellow.com/ --World Wide Yellow Pages.
This is a good place to search for a business.
You can search by company name, type of business or location.
Some
additional links that have useful information.
The
MIT Entrepreneurs club has a significant amount of material available for
entrepreneurs. The
information ranges from legal to technical.
This link should be on every budding entrepreneur's list of
essential information: http://www.mit.edu:8001/activities/e-club/e-club-home.html
A
web site that keeps track of online auctions is
http://www.itrack.com/links.html
The
Los Angeles Times at
http://www.latimes.com/HOME/BUSINESS/SMBIZ/
has lots of stories about new ventures and is worth looking at to get
business ideas and to see what kinds of ideas are working.
If
you read the sections on Articles and Speeches at this site you will find
some great information for first time entrepreneurs.
http://www.accel.com/entrepreneurs/
The
question and answer format of this site helps you get an idea of what
venture capitalists look for in a new venture.
http://www.garage.com/forums/ventureCapital/qandaArchive.shtml
For
help with legal issues, try this site.
It is written for the entrepreneur with no knowledge of the law.
http://sv.findlaw.com/
From The Journal of Accountancy, December 2001, Page 21 ---
http://www.aicpa.org/pubs/jofa/dec2001/news_web.htm
Small Business Resource Guide
"The
Small
Business Resource Guide, CD-ROM 2002 provides critical tax information
to small businesses including forms, instructions, and publications. The
CD also provides valuable business information from a variety of
government agencies, non-profit organizations, and educational
institutions. The CD contains essential startup information needed by new
small businesses in order to be successful. The design of the CD makes
finding information easy and quick and incorporates file formats and
browsers which can be run on virtually any desktop or laptop computer"
You can order up to
five free copies of this product at:
http://www.irs.gov/businesses/small/display/0,,i1%3D2%26i2%3D23%26genericId%3D7128,00.html
Other government
prepared CD-Rom products are shown on:
http://www.irs.gov/businesses/small/display/0,,i1=2&i2=23&genericId=20005,00.html
-
Business Resources
sites.krislyn.com
This home page is full of links to “strictly business sites” such
as online associations and e-zines. Users can find industry-specific
information on accounting, economics and investments, to name a few. The
business plans section of the site offers a link to a bookstore where
business people can find titles on writing and implementing their plans.
Visitors also can link to freebieclub.com, which provides links to various
discount and gratis promotional offers.
The Voice of Small Business
www.nfibonline.com
This National Federation of Independent Business site includes a tools
and tips section with articles for small-business owners, such as “Six
Ways to Keep Employees Safe on the Road,” “The Small Business
Owner’s Guide to a Good Night’s Sleep” and “A Checklist for
Starting a Small Business.”
A Big Site for Small Companies
www.smallbusiness.com
Registration here is necessary but free and lets users seek advice from
peers, share experiences and publicize their businesses with profile pages
and listings in the site’s online directory. Linked articles of interest
cover topics such as business planning, human resources, legal issues and
raising capital. They are accompanied by smallbusiness.com’s own rating
system on the article’s helpfulness.
Free Articles Here
businessbookpress.com
If you’re buying, selling or determining the value of your business,
this Web site offers free articles on all three of those subjects. Titles
include “Finding the Right Business to Buy” and “What Makes the Sale
of a Business Fall Through?” There’s also an “Ask the Expert”
message board to help users get answers to tough business questions.
Keep Up With Industry News
www.all-biz.com
This online resource center for small businesses groups its free
articles by “business zones” or sectors such as advertising,
communications, marketing and telecommunications. Registration is free and
comes with a subscription to a newsletter that offers business tips and
ideas.
Channel Surf Here
www.businesstown.com
Articles on business topics, a free newsletter and special offers on
reference materials are available here. Channels include Internet,
accounting and consulting. There’s no charge for a subscription.
Business Plan Preparation
www.businessplans.org
This Center for Business Planning site offers sample business plans,
analyses of business strategies and sections on writing and evaluating
business and marketing plans. The site also features links to other
resources including a business directory and a glossary.
A Site for Survivors
www.business-survival.com
How-to articles, surveys and reports and an ask-the-experts section
make up the bulk of the Small Business Survival Center. Articles are
broken down by categories such as starting and running a business and
dealing with technology. Titles include “10 Ways to Lower Your Computer
Support Bills” and “Top 10 Deadly Small Business Mistakes.”
Solutions for Growing Businesses
www.entrepreneurmag.com
Users can access the current and archived electronic versions of
Entrepreneur
magazine, as well as BizStartups and HomeOfficemag, at
this site. Visitors can get free subscriptions to e-newsletters and access
to Entrepreneur’s annual guide of more than 400 start-up
opportunities and the five-part guide, “How to Build a Business Plan.”
Help for Small Businesses
www.businessknowhow.com
Visitors here have access to sample business plans, classified ads,
employment forms, model legal forms and business agreements. Articles and
guidance are also offered on topics such as the Small Business
Administration’s disaster-assistance program and generating traffic for
your company’s Web site.
Small Business Helpers from the
Journal of Accountancy, March 2003,
Page 23 ---
Survival Tips
home3.americanexpress.com/smallbusiness/tool/security/protect.asp
This page of the American Express Web site offers small
business owners articles such as “Protect Your Business: Stop Fraud
Before It Starts,” as well as quizzes on security risk including “Are
You Vulnerable to Fraud and Theft?” Other resources provide guidance on
running a small business with tips on creating effective financial
controls and guarding intellectual property.
Resources for
Entrepreneurs
www.sbaer.uca.edu
For CPAs looking to start their own business or expand the
services they currently offer, the Small Business Advancement National
Center page of the University of Central Arkansas Web site features
sections such as Counseling and Consulting, Research and Dissemination,
Strategic Alliances, and Training and Education. The center also provides
a free e-mail newsletter and links to information on effective Web
marketing.
Advice from the
Advisor
www.isquare.com
The Small Business Advisor’s Web site offers CPA firm
owners a free electronic newsletter that gives Internet tips and tricks,
and marketing, sales and software assistance. Visitors can read up on
legal issues and starting or selling a business. The site also includes a
section on tax advice and answers to frequently asked questions.
Government Links for
Businesses
www.business.gov
The U.S. Business Advisor’s goal is to “make the
relationship between business and government more productive.” It helps
do that by “providing one-stop access to federal government information,
services and transactions” on its Web site. Links to government Web
pages also offer input on business development, financial assistance,
international trade, taxes and workplace issues.
Small Business Links
www.bizmove.com
CPAs who wish to enhance their existing Web presence will
want to surf this Web site—“the small business knowledge base.” A
free subscription to its e-zine, BizTips, includes a download of
the e-book 101 Tips and Strategies to Small Business Success. Users
also can link to applications for free government grants and business plan
templates.
Online Business
Information
smallbusiness.yahoo.com
This section of Yahoo includes links to assist small
business owners in finding online resources for creating a Web presence
and managing and promoting their businesses. CPAs also can link to
articles on business incorporation and financing, such as “How Attention
to Safety Can Boost Your Profits” and “Is It Better to Lease or Buy
Equipment?” This site also offers information on business, marketing and
planning a Web strategy.
EP Phone (From) Home
www.en-parent.com
For entrepreneurial parents (EPs) working from home, this
Web site aims to help “EPs make a living and a life.” The site
features topical articles such as “Six Ways to Work-Family Balance”
and “The Top Ten FAQs About Starting a Business.” It also includes
links to administrative, entrepreneurial and home business Web sites.
From Smart Stops on the Web, Journal of Accountancy, February
2002, Page 25 --- http://www.aicpa.org/pubs/jofa/feb2002/news_web.htm
Business Advice for Mom and Pop
www.efamilybusiness.com
This site offers information about off-site presentations on topics
such as succession and continuity, and strategy, planning and
family-business policies. Free articles written by internal staff
include these titles: “Supporting the Successor” and “Estate
Fairness for Children In and Out of the Business.”
Make Your Practice Perfect
www.business-management-consulting.com
Looking for information on business processes, changes in management,
corporate governance, e-business practices, HR and strategic planning?
Find them all in this site’s management-resources section. Business
news articles cover topics such as IT and software companies, layoffs
and changes, and stunning growth.
Virtual M&A Adviser
www.maadvisor.com
“Issues, trends and strategies for successful mergers and
acquisitions” are featured here. Registered guests can access the
discussion forum and download section, as well as receive discounts at
the online store. The discussion forum includes general questions and
answers about mergers and acquisitions, and the download section
includes audio clips, documents and speeches from industry leaders on
M&A issues.
For Dot-Com Buyers and Sellers
www.webmergers.com
Current statistical data on dot-com fire sales and the dot-com
marketplace, news of Internet shutdowns and resource-pooling mergers as
well as articles on buying-and-selling strategies are available here.
Users can read stories such as “Buying a European Technology
Company—Key Questions,” “Five Tips for Sellers of Dot-Coms” and
“M&A Outlook for Internet Consulting Firms.”
Small-Business Resource
www.businessownersideacafe.com
( formerly www.ideacafe.com)
Small-business owners can find information on starting and running a
business here. An ask-the-experts forum, discussion threads and shared
tips add to the site’s content. Business names, e-commerce, marketing
and working at home are some of the topics in the CyberSchmooz area.
Membership is free and gives access to information on business awards,
contests and grants.
SBA Addresses 9/11
www.sbaonline.sba.gov
The Small Business Administration (SBA) created a large
disaster-assistance section on its Web site in response to the events of
September 11th. Visitors will find links to local assistance programs
and to state and federal disaster loans and grants. Other resources
include the SBA’s answer desk for questions about financing and
starting a small business.
Disaster-Recovery Information
www.fema.gov
The Federal Emergency Management Agency (FEMA) site added three
sections after the terrorist attacks on the United States. Victims
Benefits and Assistance lists organizations addressing individual and
business-related concerns, contact information and victims’
eligibility requirements. The New York Recovery News section has links
to city and state emergency-management offices. Information About
Anthrax gives U.S. Postal Service updates.
Find the Perfect Job
www.jobfactory.com
Finding a new job or changing careers just got a lot less stressful.
This site features JobSpider, a search engine for positions by title and
location, as well as JobFactory’s own list of 250 top career sites.
Plus, users can find links to more than 23,000 Web sites that post
available jobs and want ads from most online U.S. newspapers.
|
-
-
From Smart Stops on the Web, Journal of Accountancy, July 2003,
Page 25
- A Big Small Business Portal
www.workz.com
Small business owners looking for a springboard to
online e-business and e-marketing resources will want to bookmark this
site. With more than 3,000 articles on topics including attracting
customers, copyright protection, effective Web content and writing for
the Internet, this portal offers something for every Web-based company
looking to make and save money. The Hot Topics and Guest Experts
sections link to other professionals’ advice and tips for building a
viable e-business.
-
- Advice for the Soloist
www.workingsolo.com
Anyone working out of a small or home office can get
free quarterly e-mail newsletters with insights for the self-employed
from author and corporate consultant Terri Lonier’s Web site. Her
e-stop’s frequently asked questions section addresses queries such as,
“How much start-up capital does a typical small business need?”
-
- Providing for the Common Defense
www.dfas.mil
The Defense Finance and Accounting Service (DFAS) Web
site gives U.S. military personnel free financial information. Sections
include accounting services, civilian, commercial and military pay, and
retired and annuitant pay. The Money Matters section gives links to
information on disbursement, garnishment, out-of-service debt and
transportation and travel pay.
-
- In the Pink
www.freeagentnation.com
Roughly 33 million workers in the United States are
self-employed according to author Dan Pink’s Web site. He categorizes
them as either microbusinesses, soloists or temps. His Web site features
articles he authored, such as “Would It Work to Swap Distant
Elder-Care Duty?” and “Custom Postage: An Idea That Might Stick.”
Other sections include Pink’s Free Agent Top News and Tip of the Week.
- From Smart Stops on the Web, Journal of Accountancy, July 2003,
Page 19
- For the Small Business Owner
www.mercurypartners.com
The Web site of Rockville, Maryland-based consulting
firm Mercury Partners offers articles such as “Points to Consider
Before Raising Capital,” “Five Business Plan Mistakes: How to Avoid
Them” and “Understanding Cash Flow.” This site also includes links
to the Small Business Administration’s home page and other Web stops
of interest to mom-and-pop shops.
- Reach Out to Consultants
www.contractedwork.com
Professionals seeking freelancers in fields such as
business writing, graphic and Web design, software and computer
programming can post their projects for free at the Contracted
Work—Global Business Center Web site and receive bids electronically.
Contractors looking for work can sign up for a low-priced one-week or
one-month trial so they can put bids in on jobs and receive contact
information for prospective employers.
- A Big Site for Small Business
www.nwfusion.com
The Network World Fusion Web site bills itself as “the
leader in network knowledge,” and with offerings such as detailed
hardware and software buyer’s guides, daily news feeds and product
tests and reviews, it’s a valid claim. Visitors can apply for 51 free
issues of Network World magazine, as well as register for a free weekly
e-mail newsletter.
- “Solutions for Growing Businesses”
www.entrepreneur.com
Starting and growing small companies will benefit from a
visit to this Web site, which touches on almost all aspects of small
business expansion—from human-resources-management advice to software
guides. Categories in the Small-Biz Essentials section include the
franchise zone, home-based business, money and finance, sales and
marketing and technology. Visitors also might want to check out the Ask
the Employment Law Expert and How-To Guides sections.
- For Comparative Coverage
www.healthinsurancefinders.com
Whether you need family or small business health, dental
or life insurance, this free Web site uses your search criteria to find
the lowest rates among providers. You can research other categories of
insurance including disability and long-term care. You also can find a
glossary of insurance terms and links to sites to get travel and health
and fitness information.
-
-
Business Firm and Other Directories
- Probably the best place to begin is Google ---
http://directory.google.com/
-
- Then try Yahoo ---
http://dir.yahoo.com/Business_and_Economy/
-
- Entrepreneurial Edge
http://edge.lowe.org/
Banking Industry
http://special.northernlight.com/banking/index.html
From the Scout Report --- Business.com
http://www.business.com/
The owners of this lucrative URL address have
sponsored a Web directory created by a "team of 50 research analysts
[that] has sifted through the Web to find relevant sites for our
handcrafted Directory." All Websites in this 30-category directory
have been annotated. The annotations, however, tend to be very terse and a
bit vague. First time users are encouraged to skim over the excellent site
guide, which gives a step-by-step manual for using the site as well as
in-depth explanations of the terminology and taxonomy.
Management
and Organization Behavior
A Management Vortal
ManagementFirst.com
http://www.managementfirst.com/what_makes_us_different/index.htm
The ManagementFirst
portal is open to all practising managers, business professionals, and
management researchers. We call you "thinkers in management".
-
You have a
specific interest in management discipline.
-
You are seeking
current research to produce a report, progress up a learning curve, or
simply update your skills and knowledge base.
-
You are interested
in information exchange and confirmation and seek to connect with
colleagues in your field.
-
Alternatively, you
might need an overall view of what's hot in the field of management - both
theory and current news.
To meet your
information needs, ManagementFirst has produced and resourced a collection of
current research, summaries, guides and advice in our ManagementFirst Expert
Channels. These are expert team-lead compilations of the best content from
specific subsections of the field of management.
Each Expert Channel
has a basic menu of content, which includes:
-
New key journal
articles every month - expertly chosen and absolutely free
-
Information and
advice from our growing group of management experts
-
News and notes on
relevant topics
-
Book reviews
covering the latest management publications
-
Reader's polls,
saved searches and more
Find out more about
ManagementFirst:
E-Commerce News and Education ---
http://www.ecommercetimes.com/
Resources for consultants ---
http://www.consultingcentral.com/
Find a consultant ---
http://www.consultants-mall.com/
From the Scout Report (Another search engine)
Sookoo!
http://www.sookoo.com/
Sookoo (Strategy Organized Online [with] Key Ordered Optimization) is a search
engine dedicated to making it "easier to find high-quality business
strategy information on the web." According the Sookoo's developers, Alan
Wickham and Danny Capparelli, because the search mechanism is already focused
on business management information, the hits tend to be much more germane than
those from larger, all-purpose search engines. Although search terms seem to
be limited, the browseable directory of popular searches renders a decent
number of annotated sites.
Academy of Management
The Association of Management and International
Management (AoM and IAoM)
National Commission on
Entrepreneurship --- http://www.ncoe.org/
CEO Express at
http://www.ceoexpress.com/
The Umbrella Project (helpers for starting up a small business)
http://www.umbrellaproject.com/
US News Online
Comparisons of Programs in Higher Education
Cornell University's
Workplace
Issues Today
A Salary Comparison Guide
National Employee Benefits Web
The Argus Clearinghouse
The Corporate Library ---
http://www.thecorporatelibrary.com/
Collective Bargaining Information Sources (Labor, Management)
http://www.ilr.cornell.edu/library/reference/guides/collbarg/default.html
Entrepreneur's Help Page
http://www.tannedfeet.com/index.html
For $8.95, you can get the whole Entrepeneurs Help Page downloaded on book
format (including legal forms) ---
http://www.tannedfeet.com/html/buy_the_page_.htm
Donna Dubinsky reflects on her 15 years as a company executive and releases
15 "lessons" she's gained from them ---
http://www.wirednews.com/news/holidays/0,1882,47844,00.html
Also see
Small Business
Marketing
Marketing Science Institute ---
http://www.msi.org/
Conference on Historical Analysis and Research in Marketing
Proceedings ---
http://faculty.quinnipiac.edu/charm/cumulative_proceedings.htm
Advertising Age --- http://adage.com/
How to search for a Product or Service
From the Wharton School at the University of Pennsylvania
In 1998, Microsoft executive John Wood decided to take a
rare and hard-won vacation. He started out trekking in Nepal and ended up
establishing a foundation, Room to Read, that has created nearly 3,000 libraries
in the developing world and stocked them with more than one million books. His
experiences are chronicled in a recently-published book that offers his
corporate-based perspective on how to raise money, market the product, leverage
relationships and, ultimately, maximize results.
"How John Wood Left Microsoft to Change the World -- through Books (Including
His Own)," Knowledge@Wharton, December 13, 2006 ---
Click Here
Product Search With Options to Rent of Buy It
Cheaper?
That plus much more!
"Amazon: Giving Away the Store," by Wade Roush,
Technology
Review, January 2005 ---
http://www.technologyreview.com/articles/05/01/issue/roush0105.asp?trk=nl
Visit Amazon Light at
www.kokogiak.com/amazon4,
and you’ll see a plain search box that allows you to locate any product in
Amazon.com’s database. Click on an item, and you’ll be taken to a page with
the usual product image, price information, and customer reviews, and, of
course, the familiar “Buy This” button. Amazon Light’s pages are
deliberately less cluttered than those at Amazon itself, but the family
relationship is obvious.
Look closer, however, and you’ll spot some
distinctly non-Amazonian features. If the item you’re viewing is a
DVD, for example, there will be a button that lets you see in a single
click whether the same disc is for rent at Netflix. If it’s a CD,
you can check whether Apple’s iTunes music store has a downloadable
version. And if it’s a book, Amazon Light will even tell you whether
it’s on the shelf at your local public library.
Product search helpers are available at
http://faculty.trinity.edu/rjensen/searchh.htm#ProductsAndMarketing
Bob Jensen's search helpers are at
http://faculty.trinity.edu/rjensen/searchh.htm
Mergers, Acquisitions and
Alliances (IMAA), an academic, non-profit research think tank on
M&A. We also offer on our website statistics on M&A:
http://www.imaa-institute.org/statistics-mergers-acquisitions.html
Accounting and Professional Services
Bob Jensen's threads on professional services and
fees --- http://faculty.trinity.edu/rjensen/fees.htm
How to Report Crime and Fraud
Accounting Fraud (including the Enron scandal
on creative accounting) ---
http://faculty.trinity.edu/rjensen/fraud.htm
When you
get a new suspect that sounds like consumer fraud, you probably
should investigate it and/or report it to
http://www.consumer.gov/sentinel/
The
FBI's Internet Fraud and Complaint Center (IFCC FBI) To thwart fraud on the Internet and terror in general, check in and/or
report to http://www1.ifccfbi.gov/index.asp
National
Infrastructure Protection Center (NIPC) --- Report security incidents
here. Located in the FBI's headquarters building in Washington, D.C., the NIPC
brings together representatives from U.S. government agencies, state and
local governments, and the private sector in a partnership to protect
our nation's critical infrastructures. http://www.nipc.gov/
One of our local television
stations in San Antonio recommended the Private Citizen web site
for reducing the amount of junk phone calls and junk mail that you would
like to halt. The Wall Street Journal has also recommended
this web site. http://www.privatecitizen.com/
Bob Jensen's Threads on Accounting Fraud ---
http://faculty.trinity.edu/rjensen/fraud.htm
|
Marketing News ---
http://www.clickz.com/
High-Tech Marketing
How cell phones are becoming a key link between companies and customers. How
new-breed software helps create personalized pitches. How ads are moving into
video games. And more ---
http://www.businessweek.com/technology/tc_special/tc_04marketing.htm
ClickZ's Marketing Search
Engine Watch released its annual list of outstanding Web search services for
2003. Your favorites are among them, but there were also surprises and
controversial predictions for the coming year ---
http://www.clickz.com/experts/search/opt/article.php/3319991
Bob Jensen's search helpers are
at http://faculty.trinity.edu/rjensen/searchh.htm
The Association for Accounting Marketing (AAM) web site
http://www.accountingmarketing.org/index.asp
Assessing The ROI Of Marketing
Promotions
An emerging class of software helps execs track the success of product
promotions and comply with government regulations.
http://update.informationweek.com/cgi-bin4/DM/y/egIL0GMPWZ0G6p0CSak0AF
"Google's Brave New World," by Vincent Ryan, Newsfactor.com,
April 15, 2003 --- http://www.newsfactor.com/perl/story/21267.html
Search engine
Google
is virtually revered by the Internet community and is often profiled as a pure
technology company that does not take commercial interests to heart. But those
days are over. In the past two years, Google has inked revenue-generating
deals with almost every major player on the Internet, stepped up efforts to
secure the lion's share of Internet advertising dollars, and tested the waters
in the news and e-commerce sectors.
Where are these ventures taking Google, and where is
Google taking the Internet? It is more than an academic question: Google
processes more than 150 million Web searches per day. By some accounts, 75
percent of the outside traffic to any given Web site originates on Google.
Where Google goes, so goes the Web.
Searching
for Advertising
Google's primary emphasis in the past year has been
on developing its offerings and reach in Internet advertising. The company's
text-based AdWords program has been a big success since its inception a year
ago. And it is easy to see why: For text-based ads related to searches,
click-through rates tend to be four to five times higher than for traditional
banner advertising.
To place a text ad, advertisers choose which keywords
they want to target. On Google, keywords are auctioned off: The higher the
bid, the higher the ad will appear on the search results page. Click-through
performance also factors in. The higher the click-through rate, the less
costly the text link. "Irrelevant ads are dropped down the page, and
advertisers who are more relevant will save money," Andrew Goodman,
principal at search engine optimization firm
Page
Zero Media, told the E-Commerce Times.
But for revenue, nothing beats Google's premium
sponsorship program, in which advertisers purchase prime real estate at the
top of a search results page. "Google's probably looking to get 40
percent to 50 percent of [its] revenue [by] targeting big companies with those
premium spots," Goodman said.
Eye
off the Ball?
In addition, the company has expanded its advertising
offerings by placing cost-per-click advertising on content-targeted Web pages.
So far, the program has been piloted on such sites as HowStuffWorks and
Knight-Ridder properties the San Jose Mercury News and The Philadelphia
Inquirer. Amazon.com (Nasdaq: AMZN)
is the latest partner to sign up, giving Google advertisers a prime
high-traffic site on which to attract customers. But the jury is still out on
how effective this marketing program will be.
"I think the content targeting will be less
lucrative because click-through rates are much lower," Goodman said.
Google also has moved into syndicating ads to ad
networks such as FastClick and Burst Media, which serve smaller clients. With
all this activity, Google and its competitors actually are running out of
spots to place ads, according to Goodman. "There's a finite pie they're
all fighting over."
Google was unavailable for comment
Bob Jensen's search helpers are at
http://faculty.trinity.edu/rjensen/searchh.htm
January 30, 2004
message from Carolyn Kotlas [kotlas@email.unc.edu]
GUIDE TO CONDUCTING
SURVEYS ONLINE
A 2001 RAND
Corporation report, CONDUCTING RESEARCH SURVEYS VIA EMAIL AND THE WEB [ISBN:
0-8330-3110-4], discusses the pros and cons of using email and the Web to
conduct research surveys. The authors (Matthias Schonlau, Ronald D. Fricker,
Jr., and Marc N. Elliott) provide an overview of the various aspects of the
research survey process, guidelines for choosing the type of Internet survey
to use, and suggestions for designing and implementing Internet surveys. The
report is available for purchase in paperback or online in PDF format, at no
charge, at http://www.rand.org/publications/MR/MR1480/
The RAND Corporation
is a nonprofit research organization "providing objective analysis and
effective solutions that address the challenges facing the public and private
sectors around the world." For more information, link to
http://www.rand.org/
14 to 42 (Advertising Billboards in
NYC) --- http://www.14to42.net/
KnowThis
Marketing Virtual Library --- http://www.knowthis.com/
And the Oscar Goes to... Online Advertisers There's nothing like a
high-profile event to get online marketers thinking creatively.
http://www.clickz.com/media/media_buy/article.php/2117931
AdCracker.com
http://www.adcracker.com/index.htm
The site provides a lot of helpers for creating advertisements.
CRM = Customer Relations Management
Trading Places, Part 2 If the CRM software craze is over, what's next? The
second of a three-part series on the future of CRM applications.
http://www.clickz.com/crm/crm_strat/article.php/1198531
Note the CRM online service at NetSuite ---
http://www.netsuite.com/portal/home.jsp
The American Package Museum (History, Marketing, Advertising) ---
http://www.packagemuseum.com/
Listen to the Audience Which online ads turn consumers off, and which turn
them on? Ask some and find out for yourself.
http://www.clickz.com/media/media_buy/article.php/1184801
Study: Catalogers Excel in E-mail UPDATE: Catalogers' click-through and
pass-along rates are almost twice those of the online direct marketing from B2B
and other industries.
http://www.internetnews.com/IAR/article/0,,10789_1299271,00.html
19th Century Advertising (History) ---
http://advertising.harpweek.com/
Richard Siedlek's article entitled "Be a on the Web" has a
wonderful listing of advertising and marketing links ---
http://www.aicpa.org/pubs/jofa/apr2001/siedleck.htm
Helpers for Marketing Students and
Educators --- MarketingProfs.com ---
http://www.marketingprofs.com/
Marketing Behind the Iron Curtain 1986-1990 (Photography)
Windows Through the Curtain ---
http://www.photoarts.com/journal/Hlynsky/hlynskyindex.html
Consumer Protection, Fraud Information, Deceptive Practices
When you get a new suspect that sounds
like fraud, you probably should investigate it and/or report it to
http://www.consumer.gov/sentinel/
The FBI's Internet Fraud and Complaint Center (IFCC
FBI)
To thwart fraud on the Internet and terror in general, check in and/or report
to http://www1.ifccfbi.gov/index.asp
Bob Jensen's Threads on Accounting Fraud ---
http://faculty.trinity.edu/rjensen/fraud.htm
Nigerian Frauds
Below are some
websites devoted to this fraud. I hope these have not previously been posted:
U.S. Treasury
warning:
http://www.ustreas.gov/usss/index.htm?alert419.htm&1
A coalition against
this fraud:
http://home.rica.net/alphae/419coal/
Putting
"Nigerian oil fraud" or "Nigerian 419" into a search
engine will provide additional links.
Dr. Frederic M.
Stiner, Jr.
CPA Department of Accounting & MIS
University of Delaware office: (302) 831-1806
Newark DE 19716 USA fax: (302) 831-4676
Links of possible interest in consumer
fraud and consumer protection include the following:
http://www.consumerreports.org/main/home.jsp
http://www.pueblo.gsa.gov/scamsdesc.htm
http://www.consumer.gov/sentinel/
U. S. Consumer Gateway ---
http://www.consumer.gov/
Dr. Toy's Guide on the Internet ---
http://www.drtoy.com/
Consumer Product Safety Commission ---
http://www.cpsc.gov/
ConsumerSearch ---
http://www.consumersearch.com/www/
Yahoo! Warehouse - buy and sell used, overstock, and clearance goods ---
http://warehouse.yahoo.com/
The Future of Interactive Television: Report From Two Alternate Universes
Recently, I had the pleasure of visiting two alternate universes. The first was
the very heart of the ad industry, the American Association of Advertising
Agencies's (AAAA) Media Conference in Orlando, FL.
http://www.newmedia.com/default.asp?articleID=3506
Consumer World ---
http://www.consumerworld.org/
Comparison Pricing ---
http://www.smartshop.com
/
Consumer Information Guides ---
http://www.pueblo.gsa.gov/
Internet Catalogue (Shopping, Marketing) ---
http://catalogue.bized.ac.uk/
Emergence of Advertising in America: 1850-1920 (Marketing, History)
http://scriptorium.lib.duke.edu/eaa/
Each of the big-three retailers -- Wal-Mart, Kmart, Target -- has full Web
storefronts for the first time the Year 2000 holiday season, and each is banking
on big sales ---
http://www.eweek.com/a/pcwt0012085/2662937/
E-Commerce News and Education ---
http://www.ecommercetimes.com/
An Internet/Web portal with 14 channels on marketing and e-Commerce ---
http://www.internet.com/home-d.html
- Internet Technology
- Ecommerce/Marketing
- Web Developer
- Windows Internet Tech.
- Linux/Open Source
- Internet Resources
- ISP Resources
- Internet Lists
- Download
- International
- International News
- International Investing
- ASP Resources
- Wireless
Other examples of portals and vortals
can be found at http://faculty.trinity.edu/rjensen/000aaa/portals.htm
Accounting News, Blogs, Tweets, etc. ---
http://faculty.trinity.edu/rjensen/AccountingNews.htm
Media Metrix (Tracks Web Navigations of
Web Users)
CentsOff Coupons - Online Grocery Coupons
Consumer Behavior
Book With Online PowerPoint and Cases
Directory Sponsor
Information
Electronic
Billboards on the Digital Superhighway
The Internet
Advertising Resource Guide
Web Digest for Marketers --- http://wdfm.com/
Science, Tobacco, and You -- AdSmart ---
http://scienceu.fsu.edu/content/adsmart/docs/teacherinfo.html
Marketing on the Internet http://iws.ohiolink.edu/moti/
Marketing on the Web (with some
management helpers thrown in)
KnowThis.com ---
http://www.KnowThis.com/
This is a really flashy hyperactive way to market a product (in this case VW cars) on
the web (Marketing and Advertising)
Turbonium
http://www.turbonium.com/
When accounting for advertising firms, Susan Jeter recommended Adman
from Marketing Resources Plus
http://www.lib.polyu.edu.hk/electdb/DATAPRO/154-1.htm#prod30
A great listing of URLs of companies selling
accounting systems software.
http://www.lib.polyu.edu.hk/electdb/DATAPRO/154-1.htm
Mitchell Levy really has a street-smart handle on what is happening on the streets of
e-commerce (EC), e-marketing, and new
technologies. I signed up. The main link to the newsletter is at
http://ecmgt.com/
Literature, Art, Marketing, and History
Lurid Paperback Cover of the Week (a database of vintage covers of books)
http://www.nwrain.com/~monlux/LuridPaperbackofWeek.html
A weekly updated commentary on the Vintage Paperbacks
of the 30's, 40's and 50's, featuring artwork and editorials on the history of
what was a uniquely American approach to the development of various forms of
marketing for the newly invented paperback.
From The Journal of Accountancy, December 2001, Page 21 ---
http://www.aicpa.org/pubs/jofa/dec2001/news_web.htm
For the Discerning Consumer
www.consumerreview.com
This site features product reviews written by the people who know these
items best—the consumers who purchase and use them. All candid reviews
have strengths, weaknesses and summaries of the products. Categories include
auto, computer hardware, electronics, and home and garden. These are further
broken down into item-specific sections like desktops, notebooks and
personal digital assistants
Signs (Art, Advertising, Marketing, History) ---
http://www.pjchmiel.com/photo/signs.html
Also see E-Commerce
Marketing Research
Bob Jensen's threads on
e-Business and e-Commerce ---
http://faculty.trinity.edu/rjensen/ecommerce.htm
e-Business and e-Commerce Data
Internet.com ---
http://www.internet.com/sections/marketing.html
Web data and statistics
Builder.com ---
http://builder.cnet.com/webbuilding/pages/Servers/Statistics/
This site is great for definitions and explanations.
Why Web usage statistics are (worse than) meaningless ---
http://www.goldmark.org/netrants/webstats/
Internet Sizer http://www.netsizer.com/
(This site has a link to a neat graph that shows the increase in Web use in a
spinning real-time counter. It resembles the counter on Times Square
that used to show the increases in the U.S. National Debt.)
Web Characterization ---
http://wcp.oclc.org/
Listings from Webreference.com ---
http://webreference.com/internet/statistics.html
Internet Statistics
- CyberAtlas (*)
- Internet market research and information site. Provides a
periodic overview of Internet trends, demographics, marketing, and
advertising information.
- CyberGeography
- Interesting collection of experiments and approaches in
visualizing internet statistics and topology.
-
GVU WWW
User Surveys
- User surveys dating back to 1994. The surveys feature a wide
variety of WWW usage and opinion-oriented questions.
-
The
Internet Index
- "An occasional collection of facts and statistics about the
Internet and related activities." By Win Treese of Open
Market.
- ISC: Internet Domain Survey
- Estimates the number of hosts and domains by doing a complete
search of the Domain Name System. From the Internet Software
Consortium.
- Media Metrix
- Web market research information and analysis service providing
demographic data, measuring Internet and digital media audiences
and usage since 1996.
- MIDS: Matrix Information and
Directory Services
- MIDS provides statistics on about the Internet and estimates of
its growth. Information is presented textually, graphically, and
in geographic maps.
- Netcraft
- Conducts the Web Server Survey which tracks the usage of HTTP
server software. Also offers a searchable hostname database.
- Nielsen Net-Ratings
- Online usage and popularity statistics.
- Nua's Internet Surveys
- An organized collection of Internet statistical surveys. Has
digests of the important research reports and demographic surveys
from the major research companies. Includes summary graphs and
data of Internet statistics and trends. Offers a monthly
newsletter.
- StatMarket
- In-depth statistics on a wide variety of Internet topics, and a
sharp interface. StatMarket provides free global Internet usage
statistics gathered from tens of thousands of web sites and and
millions of daily visitors.
- TheCounter.com
- Detailed browser statistics, including information on monitor
resolution, color depth and java/javascript usage.
-
Yahoo:
Statistics and Demographics
- Yahoo's collection of related sites.
|
Other related sites
Top Five Marketing Concerns
for the Next Five Years What marketers will need to know in the future.
http://www.newmedia.com/nm-ie.asp?articleID=3064
KnowThis
Marketing Virtual Library --- http://www.knowthis.com/
Marketing Research Helpers at
http://go.hotwired.com/webmonkey/99/18/index3a.html/eg1999183
Marketing on the Web (with some
management helpers thrown in)
KnowThis.com ---
http://www.KnowThis.com/
Medicine and Madison Avenue (Marketing and Advertising History)
http://scriptorium.lib.duke.edu/mma/
Thank you Kim Robertson
Advertising World at
http://advertising.utexas.edu/world/
Advertising Age at http://www.adage.com/
Mousetracks Marketing List of Lists
http://www.nsns.com/MouseTracks/tloml.html
American Marketing Association http://www.ama.org/
Tilburg University at
http://cwis.kub.nl/~few/few/be/marketin/links.htm
Wharton School of Business marketing links at
http://hops.wharton.upenn.edu/othrmktg.html
University of California long list of marketing links at
http://blues.fd1.uc.edu/~machleka/imrl.html
Braun's Brains at
http://www.braunsbrains.com/favorite.htm
The Corporate Library --- http://www.thecorporatelibrary.com/
Click
here to go directly to the Index for all bookmark sections