Check Out College Tax Credits for 2016

With another school year now in full swing, the Internal Revenue Service today reminded parents and students that now is a good time to see if they qualify for either of two college tax credits or other education-related tax benefits when they file their 2016 federal income tax returns next year.

In general, the American Opportunity Tax Credit or Lifetime Learning Credit is available to taxpayers who pay qualifying expenses for an eligible student. Eligible students include the taxpayer, spouse and dependents. The American Opportunity Tax Credit provides a credit for each eligible student, while the Lifetime Learning Credit provides a maximum credit per tax return.

Though a taxpayer often qualifies for both of these credits, he or she can only claim one of them for a particular student in a particular year.  To claim these credits on their tax return, the taxpayer must file Form 1040 or 1040A and complete Form 8863, Education Credits.

The credits apply to eligible students enrolled in an eligible college, university or vocational school, including both nonprofit and for-profit institutions. The credits are subject to income limits that could reduce the amount taxpayers can claim on their tax return.

To help determine eligibility for these benefits, taxpayers should visit the Education Credits Web page or use the IRS’s Interactive Tax Assistant tool.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

IRS Has a Reminder for Extension Filers

The Internal Revenue Service has an important reminder for taxpayers who filed for an extension and face an Oct. 17 filing deadline: the adjusted gross income (AGI) amount from your 2014 return may be needed to electronically file a tax return.
The IRS reminds all taxpayers that they should keep a copy of their tax returns and supporting documents for a minimum of three years. Going forward, keeping copies of tax returns is even more important as the IRS makes changes to protect taxpayers and authenticate their identity.
The IRS recommends extension filers using a software product for the first time plan ahead. They should locate a copy of their 2014 tax return or alternatively, order a tax transcript, a process that may take five to 10 calendar days. The adjusted gross income (AGI) is clearly labeled on both the tax return and the transcript
Taxpayers who prepare their own electronic tax returns are required to electronically sign their return by using a five-digit, self-selected personal identification number (PIN). In order to authenticate their identities, taxpayers will now also need to enter either of two items: their prior-year AGI or their prior-year self-select PIN and their date of birth. If married filing jointly, both taxpayers must authenticate their identities with this information.
The IRS is phasing out the use of the Electronic Filing PIN, which is no longer available as an alternative except for those taxpayers who had obtained an e-file PIN earlier this year. The IRS emphasizes that those filers may use their e-file PIN for this year only.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

New Private Debt Collection Program

The Internal Revenue Service announced today that it plans to begin private collection of certain overdue federal tax debts next spring and has selected four contractors to implement the new program.

The new program, authorized under a federal law enacted by Congress last December, enables these designated contractors to collect, on the government’s behalf, outstanding inactive tax receivables. As a condition of receiving a contract, these agencies must respect taxpayer rights including, among other things, abiding by the consumer protection provisions of the Fair Debt Collection Practices Act. The IRS has selected the following contractors to carry out this program:

CBE Group 1309 Technology Pkwy Cedar Falls, IA 50613

Conserve 200 CrossKeys Office park Fairport, NY 14450

Performant 333 N Canyons Pkwy Livermore, CA 94551

Pioneer 325 Daniel Zenker Dr Horseheads, NY 14845

These private collection agencies will work on accounts where taxpayers owe money, but the IRS is no longer actively working their accounts. Several factors contribute to the IRS assigning these accounts to private collection agencies, including older, overdue tax accounts or lack of resources preventing the IRS from working the cases.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

Beware of Fake IRS Tax Bill Notices

The Internal Revenue Service and its Security Summit partners are warning taxpayers and tax professionals of fake IRS tax bills related to the Affordable Care Act.

The IRS has received numerous reports of scammers sending a fraudulent version of a notice- labeled CP2000 - for tax year 2015. The issue has been reported to the Treasury Inspector General for Tax Administration for investigation.

This scam may arrive by email, as an attachment, or by mail. It has many signs of being a fake:

The CP2000 notices appear to be issued from an Austin, Texas, address;

The letter says the issue is related to the Affordable Care Act  and requests information regarding 2014 coverage;

The payment voucher lists the letter number as 105C;

Requests checks made out to I.R.S. and sent to the “Austin Processing Center” at a post office box.

IRS impersonation scams take many forms: threatening phone calls, phishing emails and demanding letters. Learn more at Reporting Phishing and Online Scams. The IRS does not initiate unsolicited email contact or contact by social media.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

Newly Married Couples Should Report Marriage to Marketplace

If you’re recently married, you probably have a list of things to do.  There’s one other thing you should add to that list: a health insurance review. This is particularly important if you enrolled in coverage through a Health Insurance Marketplace and you receive premium assistance in the form of advance payments of the premium tax credit.

When you apply for assistance to help pay the premiums for health coverage through the Marketplace, the Marketplace will estimate the amount of the premium tax credit that you may be able to claim for the tax year using information you provide. This information includes details about your family composition and your projected household income.

It is important for you to report life changes – known as changes in circumstances – to your Marketplace to get the proper type and amount of financial assistance and to avoid getting too much or too little in advance. Reporting changes in circumstances will allow the Marketplace to adjust your advance credit payments. This adjustment will help you avoid getting a smaller refund or owing money that you did not expect to owe on your federal tax return.

To report changes and to adjust the amount of your advance payments of the premium tax credit you must contact your Health Insurance Marketplace. Be sure to report all changes directly to that Marketplace because they can affect both your coverage and your final credit when you file your federal tax return.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

Six Tax Tips For Independent Contractors

The fact that you are getting a 1099-MISC to report your earnings to the IRS means you are in business for yourself. You need to take full responsibility and treat your business as a business—and do the normal things a business does when filing taxes.

Here are a few ways you can start acting like a business and mitigate issues with the IRS.

1. Stop giving out your Social Security number and get an Employer ID (EIN) number. This accomplishes two things: It protects you from identity theft, and it shows the IRS that you are a business.

2. Open a business bank account, using your new EIN, to separate your personal finances from your business finances.

3. Keep books. If you don’t know how to keep your books, it’s time to either learn or hire a competent bookkeeper.

4. Select accounting software that’s appropriate for your business—don’t just use something that doesn’t really meet your needs just because it’s free. These days, there are sophisticated choices that can not only track your bookkeeping needs but also help you create a business website.

5. Do some tax planning. Read a book on small business taxes to learn how about tax benefits available to business owners of all kinds.

6. Pay your estimated taxes. After you have the numbers and know what they mean, and once you have reduced your profits by taking advantage of tax planning, you can determine your quarterly profits

 Even if your overall taxable income is a loss, you may owe taxes because your Schedule C had a profit. You’ll be paying 15.3 percent as self-employment taxes (Social Security and Medicare) on those profits.

Courtesy of Equifax

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

IRS Urges Employers to Take Advantage of Expanded Work Opportunity Tax Credit

With a key certification deadline fast approaching, the Internal Revenue Service today urged employers to take advantage of a valuable tax credit designed to help those who hire long-term unemployment recipients, certain veterans, recipients of various kinds of public assistance and other workers who face significant barriers to employment.

The Protecting Americans from Tax Hikes (PATH) Act, enacted last December, retroactively extended the Work Opportunity Tax Credit (WOTC) for nine categories of workers hired on or after Jan. 1, 2015. For the first time, the legislation also added a tenth category for long-term unemployment recipients hired on or after Jan. 1, 2016 who had been unemployed for a period of at least 27 weeks and received state or federal unemployment benefits during part or all of that time. The special Sept. 28, 2016 certification deadline applies to eligible workers hired between Jan. 1, 2015 and Aug. 31, 2016.

Normally, to qualify for the credit, an employer must first request certification by filing IRS Form 8850 with the state workforce agency within 28 days after the eligible worker begins work. But due to the late enactment of the legislation extending the WOTC and its retroactive impact, the IRS is giving employers extra time, until Sept. 28, to make requests related to eligible workers hired any time in 2015 and during the first eight months of 2016. The regular 28-day rule will again apply for any eligible worker hired after Aug. 31, 2016. Other requirements and further details can be found in the instructions to Form 8850, Notice 2016-22 and Notice 2016-40, available on IRS.gov.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

Basic Bookkeeping tips

For many small businesses, the most common bookkeeping errors are also the easiest to fix. Use these six tips to help keep your business on sound financial footing.

1. Use the right accounting system. Most businesses use either cash-based or accrual-based accounting. If you use the cash method, you count income when you receive it and expenses when you pay them. Under the accrual method, you count income and expenses when they happen, not when you actually receive or pay them.

2. Maintain daily records. This is one of the most basic rules: If you don't keep accurate daily records, you don't have an accurate way to track the financial condition of your business. Different people use different record-keeping systems; what matters is that you have one and use it every day. Once you have a good system set up, accurate record keeping will take just a few minutes a day.

3. Handle and review checks carefully. It's easy to be on autopilot when you're writing checks and tossing canceled ones into a filing cabinet without reviewing them. Remember: Those checks are as good as cash. And if something goes wrong, you — not the bank — will be on the hook. Take the same care with checks as you would with cash. Sign checks using a clear, distinctive signature that won't invite forgery.

4. Get a bank statement with a month-end cutoff. This is another basic tip that can reap big rewards. Synchronizing your bank statement with other monthly records will make it much easier to reconcile your statement and track expenses.

5. Leave an audit trail. Your record keeping will be much more effective if you have a system that allows you to quickly and easily retrace your company's financial activities. This means keeping your invoices and checks in numeric order, not skipping check or invoice numbers, and keeping separate bank accounts for your business and personal funds.

6. Use a computer. Computer bookkeeping software is absolutely essential for all but the smallest businesses. These applications make it easy to track income and expenses, prepare tax documents, summarize your company's financial activities and back up records for safekeeping.

Courtesy of Score

Interest Rates Remain the Same for the Fourth Quarter of 2016

The Internal Revenue Service announced that interest rates will remain the same for the calendar quarter beginning Oct. 1, 2016.  The rates will be:

four (4) percent for overpayments (three (3) percent in the case of a corporation);
1 and one-half (1.5) percent for the portion of a corporate overpayment exceeding $10,000;
four (4) percent for underpayments; and
six (6) percent for large corporate underpayments.
Under the Internal Revenue Code, the rate of interest is determined on a quarterly basis.  For taxpayers other than corporations, the overpayment and underpayment rate is the federal short-term rate plus 3 percentage points.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

12 Tax tips for Small Business

Small-business tax rule No. 1: Don't mess with the IRS.

1. Home office
The deduction, however, isn't limited to a full room. Your home office can be part of a room. Just how much of the space is deductible? Measure your work area and divide by the square footage of your home. That percentage is the fraction of your home-related business expenses -- rent, mortgage, insurance, electricity, etc. -- that you can claim.

2. Office supplies
Even if you don't take the home office deduction, you can deduct the business supplies you buy.

3. Furniture
When your office supplies are more than just pens and paper, you have another tax-cutting opportunity.

Office-furniture acquisitions provide a couple of choices. Deduct 100% of the cost in the year of the purchase or deduct a portion of the expense over 7 years, also known as depreciation.

4. Other equipment
Items such as computers, copiers, fax machines and scanners also are tax-deductible.

5. Software and subscriptions
The increased Section 179 provides another tax break in this area of business expenses. Previously, a company had to depreciate the cost of computer software over 3 years. Now, off-the-shelf software a business buys can be fully expensed in the year purchased.

6. Mileage
If you drive for business, the IRS wants to give you some of your money back. But Uncle Sam loves documentation, so keep a notebook in your vehicle to record the date, mileage, tolls, parking costs and the purpose of your trip.

7. Travel, meals, entertainment and gifts
Good news, small-business travelers. You might as well stay in a nice hotel, because the entire cost is tax-deductible. Likewise, the cost of travel -- air, rail or auto -- is 100% deductible, as are costs associated with life on the road (dry cleaning, rental cars and tipping the bellboy).

The only exception is dining out. You can deduct only 50% of your meals while traveling.

8. Insurance premiums
Self-employed and paying your own health insurance premiums? These costs are 100% deductible.

This break primarily benefits proprietorships, but there are limits. The deduction can't be more than your business' net profit. And it's not allowed if you were eligible for other health care coverage, including that offered by your employed spouse's medical plan.

9. Retirement contributions
Are you self-employed and saving for your own retirement with a SEP IRA or Keogh? Don't forget to deduct your contribution on your personal income tax return.

10. Social Security
The bad news: If you're self-employed or starting a small business, you have to pay double the Social Security contributions you would as an employee. That's because federal law requires the employer pay half and the employee pay half. Self-employed workers are both, meaning the total will equal 15.3% of your net profits.

11. Telephone charges
You can deduct the cost of the business calls that you make for business from home. When your bill comes in, circle the business-related calls, total them up and keep a copy. At the end of the year, tally your 12 bills and deduct 100%.

12. Child labor
Depending upon how much you paid them, they might be able to avoid income taxes. Plus, there is no Social Security tax when you hire your child who is 17 or younger and you can deduct the salary as a business expense. This break is available, however, only if you operate as a sole proprietor or as a partnership in which you and your spouse are the only partners. If your business runs as a corporation, then it, not you, is considered the employer and the corporation is not relieved of the tax liabilities.
Courtesy of BankRite

How the Size of Your Workforce Affects Your Responsibilities

Two parts of the Affordable Care Act apply only to applicable large employers. These are the employer shared responsibility provisions and the employer information reporting provisions for offers of minimum essential coverage.   Whether an employer is an ALE is determined each calendar year, and generally depends on the average size of an employer’s workforce during the prior year.

How to Determine Workforce Size

To determine your workforce size for a year, you add your total number of full-time employees for each month of the prior calendar year to the total number of full-time equivalent employees for each calendar month of the prior calendar year and divide that total number by 12. If the result is 50 or more employees, you are an applicable large employer.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

6 Smart Budgeting Tips for Small Business

If you run a small business, it's likely that you're operating on a relatively limited budget. Whether you bootstrapped your business or are trying to pay back loans you took out to cover your startup costs, it's in your best interest to conserve money wherever you can.

Without a thorough budget plan, however, it can be difficult to track and manage your finances. This is especially true for any unexpected business expenses that may come up, as they often do.

If you want to keep your business operating in the black, you'll need to account for both fixed and unplanned costs, and then create — and stick to — a solid budget.

Define and understand your risks
Every business venture has a certain degree of risk involved, and all of those risks have the potential for a financial impact on your company. Paul Cho, managing director of Headway Capital, said that small business owners need to consider their long- and short-term risks to accurately plan for their financial future.

Overestimate your expenses
If your business operates on a project-to-project basis, you know that every client is different and no two projects will turn out exactly the same. This means that often, you can't predict when something is going to go over budget.
For this reason, budgeting slightly above your anticipated line-item costs, no matter what, so that if you do go over, you won't be fully unprepared.

Pay attention to your sales cycle
Many businesses go through busy and slow periods over the course of the year. If your company has an "off-season," you'll need to account for your expenses during that time. Use your slower periods to think of ways to plan ahead for your next sales boom.

Plan for large purchases carefully and early
Some large business expenses occur when you least expect them — a piece of equipment breaks and needs to be replaced or your delivery van needs a costly repair, for instance. However, planned expenses like store renovations or a new software system should be carefully timed and budgeted to avoid a huge financial burden on your business.

Remember that time is money, too
One of the biggest mistakes small businesses make is forgetting to incorporate their time into a budget plan. Business owners should keep in mind that time is money, especially when working with people who are paid for their time.

Constantly revisit your budget
Your budget will never be static or consistent — it will change and evolve along with your business, and you'll need to keep adjusting it based on your growth and profit patterns

Courtesy of BusinessNewsDaily

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

IRS Offers More Flexibility in Pension Plan Payments

The Internal Revenue Service has issued final regulations allowing pension recipients to split their benefits between both monthly annuity payments and a lump sum.

The final regulations change the rules for the minimum present value requirements for defined benefit plan distributions to enable plans to simplify the treatment of certain optional forms of benefit that are paid partly in the form of an annuity and partly in a single sum or some other more accelerated form.

The IRS issued proposed regulations in 2012 on the change and issued the final regulations with a few changes last week. The final regulations will allow pensioners to bifurcate their benefit payments so they can receive more of the pension benefits during their lifetime without disqualifying the pension plan under previous IRS rules.

The final regulations affect participants, beneficiaries, sponsors and administrators of defined benefit pension plans. The regs are effective on Sept. 9, 2016, and apply to distributions with annuity starting dates in plan years beginning on or after on or after Jan. 1, 2017. Taxpayers can also opt to apply the regulations for any earlier period.

Courtesy of AccountingToday

For more information contact Neikrik, Mahoney and Smith at 502-896-2999

5 Easy Tax Tips

Don’t Forget the Basics
When preparing your taxes, nothing is more important than keeping good records. Without accurate records of profit and loss, business expenses and eligible tax deductions, you can’t estimate your tax liability, your accountant can’t give precise and professional advice and in the event of an audit, you can’t prove your expenses.

Don’t Mix Business With Pleasure; At Least Not On Your Tax Return
One aspect of keeping good records for your business is to be sure to keep business expenses separate from your personal expenses.

Ask for Help
Between the tax code, tax regulations and IRS rulings, the federal tax rules span 73,954 pages. America’s tax system is way too complicated for most people to understand, especially if they are small business owners who have to deal with all of the extra complexities and regulatory obligations. So get an accountant to help do your taxes.

 Take Advantage of Recent Legislation
Every year there are a variety of changes to federal legislation that might affect your business and your tax return.

Avoid Common Audit Traps
Going through an IRS audit is never fun for anyone, so it’s best to avoid putting yourself in that position in the first place. With careful planning and attention to detail, you can avoid some of the most common IRS audit traps.

So, in sum: keep your files in order, stay up-to-date, and consult a professional tax adviser to avoid playing fast and loose with the federal government’s rules and regulations.

Courtesy of Kabbage

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

Bookkeepers and accountants are not the same

Accountants and bookkeepers have different jobs and responsibilities.

An accountant’s main focus is:

• the preparation and lodgment of statutory returns
• advising on legal entity structures
• giving general business and financial advice.

Accountants are usually members of a statutory association. Qualified and registered accountants might call themselves CPAs (Certified Public Accountants), CAs (Chartered Accountants) or other titles, depending on the country they're working in.

Bookkeepers can manage lots of different responsibilities within a small business. But the main focus is the organization, recording and reporting of financial transactions as part of the operational life of a small business. In more recent times, some bookkeepers have extended their range of duties to include:

• training clients to use accounting software
• implementation of document management and inventory control processes to create efficiencies within the business
• implementation of POS (point of sale) systems that capture the daily transactions in a retail environment.
• Develop, implement maintain and review internal business processes.
• 
  
• Keeping track of daily transactions
• Sending out invoices and managing the accounts receivable ledger
• Handling the accounts payable ledger
• Keeping an eye on cashflow
• Preparing the books for the accountant

It's the bookkeeper who does the day-to-day work so that the accountant can concentrate on strategic financial operations.

Courtesy of Xero

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

To Maintain Eligibility for Advance Payments of the Premium Tax Credit, File ASAP

The IRS is sending letters to taxpayers who received advance payments of the premium tax credit in 2015, but who have not yet filed their tax return. You must file a tax return to reconcile any advance credit payments you received in 2015 and to maintain your eligibility for future premium assistance. If you do not file, you will not be eligible for advance payments of the premium tax credit in 2017.

If you receive Letter 5858 or 5862, you are being reminded to file your 2015 federal tax return along with Form 8962, Premium Tax Credit.  The letter encourages you to file within 30 days of the date of the letter to substantially increase your chances of avoiding a gap in receiving assistance with paying Marketplace health insurance coverage in 2017.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

Retirement Plans Can Make Loans, Hardship Distributions to Louisiana Flood Victims

The Internal Revenue Service announced that 401(k)s and similar employer-sponsored retirement plans can make loans and hardship distributions to Louisiana flood victims and members of their families.

Participants in 401(k) plans, employees of public schools and tax-exempt organizations with 403(b) tax-sheltered annuities, as well as state and local government employees with 457(b) deferred-compensation plans may be eligible to take advantage of these streamlined loan procedures and liberalized hardship distribution rules. Though IRA participants are barred from taking out loans, they may be eligible to receive distributions under liberalized procedures.

Retirement plans can provide this relief to employees and certain members of their families who live or work in the disaster area. To qualify for this relief, hardship withdrawals must be made by Jan. 17, 2017.

The IRS is also relaxing procedural and administrative rules that normally apply to retirement plan loans and hardship distributions. As a result, eligible retirement plan participants will be able to access their money more quickly with a minimum of red tape. In addition, the six-month ban on 401(k) and 403(b) contributions that normally affects employees who take hardship distributions will not apply.

This broad-based relief means that a retirement plan can allow a Louisiana flood victim to take a hardship distribution or borrow up to the specified statutory limits from the victim’s retirement plan. It also means that a person who lives outside the disaster area can take out a retirement plan loan or hardship distribution and use it to assist a son, daughter, parent, grandparent or other dependent who lived or worked in the disaster area.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

IRS Warns of a New Wave of Attacks Focused on Tax Professionals

The Internal Revenue Service warned tax professionals of a new wave of attacks that allow identity thieves to file fraudulent tax returns by remotely taking over practitioners’ computers.

As part of the Security Summit effort, the IRS urged tax professionals to review their tax preparation software settings and immediately enact all security measures, especially those settings that require usernames and passwords to access the products.  The IRS is aware of approximately two dozen cases where tax professionals have been victimized in recent days.

The IRS, state tax agencies and the tax industry – working as partners in the Security Summit – recently launched the Protect Your Clients; Protect Yourself campaign to increase awareness that criminals increasingly are targeting tax professionals and the taxpayer data they possess.

"This latest incident reinforces the need for all tax professionals to review their computer settings as soon as possible," said IRS Commissioner John Koskinen‎. "Identity thieves continue to evolve and look for new areas to exploit‎, especially as our fraud filters become more effective. The prompt identification of these attacks is another example of the great benefits that result from the close‎ working relationship the IRS now has with the tax industry and the states through the Security Summit initiative. Information is flowing more rapidly between our groups as we continue‎ our efforts to protect taxpayers."

These attacks come as the Oct. 17 deadline approaches for extension filers. The IRS first warned of a similar remote take-over attack in the spring, just ahead of the April 15 deadline, another peak period for tax professionals.

Thieves are able to access tax professionals’ computers and use remote technology to take control, accessing client data and completing and e-filing tax returns but directing refunds to criminals’ own accounts.

Victims in the tax community learned of these thefts while reconciling e-file acknowledgements.

Courtesy of IRS

For more information contact Neikrik, Mahoney and Smith at 502-896-2999

IRS Urges Taxpayers to Check Their Withholding

The Internal Revenue Service today encouraged taxpayers to consider a mid-year tax withholding checkup following several new factors that could affect their refunds in 2017.  Taking a closer look at the taxes being withheld can help ensure the right amount is withheld, either for tax refund purposes or to avoid an unexpected tax bill next year.

The withholding review takes on even more importance this year given a new tax law change that requires the IRS to hold refunds a few weeks for some early filers in 2017 claiming the Earned Income Tax Credit and the Additional Child Tax Credit. In addition, the IRS and state tax administrators continue to strengthen identity theft and refund fraud protections, which means some tax returns could again face additional review time next year to protect against fraud.

Courtesy of IRS

For more information contact Neikirk, Mahoney and Smith at 502-896-2999

Accounting and Stocks

The importance of financial statements comes into prominent play four times a year when companies report their quarterly results. Short-term traders need to know how to quickly extract from the financial statements how the company performed so they can size up the results with the expectations of analysts. Speculators will often push stocks up and down within seconds after an earnings release as they bet on the future.

Accounting isn't just for short-term traders. Some long-term investors use so-called fundamental analysis to select companies with solid financial trends. Investors like Warren Buffett, for instance, will parse the company's accounting to see if it has sustainable competitive advantages that help increase value over time. These types of investors aren't looking for short-term shifts in the business, but rather insights on the long-term value-creating potential of a business. Trend analysis of accounting helps reveal these potentially profitable trends.

Courtesy of USAToday

For more information contact Neikirk, Mahoney and Smith at 502-896-2999