John H. Higgins 2004-2005 MACPA Chair of the Board

As we start the New Year, I’d like to call your attention to several vital issues that should be on your radar screen. Social Security Reform, peer review transparency, state tax reform, e-file and financial literacy are areas that will impact not only CPAs, but clients and employers and the taxpaying public as well.

MACPA constantly monitors legislation and regulatory activity to ensure input into these critical matters. Through programs such as our Political Action Committee and Legislative Advisory Group (who will be visiting legislators in Washington D.C. in March), CPA volunteers act on behalf of the profession in all areas of governmental affairs.

Social Security – The Challenge
While Social Security is sound for today’s seniors, it needs to be fixed for younger workers. In 1950, 16 workers supported every one beneficiary of Social Security. By the time those entering the workforce today turn 65, there will only be two workers supporting each beneficiary.

Through a resolution at the Fall AICPA Council meeting, the Executive Board of the Texas Society of CPAs called on the AICPA, other state CPA societies and all CPAs individually to encourage their elected officials in the U.S. Congress to take action to implement reforms of these government support programs; to assure their continued fiscal health; and to avoid passing a massive financial problem and burden on to future generations.

The MACPA Board of Directors is reviewing the resolution to determine what part Michigan can play.

Peer Review Transparency
Should peer review results be available to state regulators? Should the public be able to see them? That's the heart of the peer review transparency issue now being openly discussed by the AICPA.

Last spring, AICPA Council directed staff to initiate a member education program and solicit feedback. There are two primary approaches under consideration by the AICPA: providing online access of peer review results to the public, or facilitating access to the reports by state boards of accountancy. Ultimately, AICPA members will make the decision as disclosure of peer review information can only pass with a two-thirds membership vote.

Become informed on this crucial issue: read this month’s peer review article, and visit the AICPA’s Peer Review Transparency web site.

State Tax Reform
State budget problems are widely publicized, as are the spending cuts and many “quick fixes” put in place over recent years. As Governor Granholm and legislators look for long-term solutions to the state’s financial woes, the MACPA is working hard to position CPAs – including a sub-task force on business tax of our State and Local Tax Task Force – as a resource to help evaluate the ramifications of various options.

E-file Update
As we approached our second tax season with mandated e-file for preparers who submit 200+ returns, both the IRS and Michigan Treasury sought input from the MACPA and its members. Giving our members an opportunity to sound-off about the pros and cons of e-filing, results of our recent online e-file survey were recently shared with both. (If you’d like to review the results, download the PDF.)

This valuable dialogue works both ways. The IRS and Treasury indicate that practitioners’ e-file questions often focus on issues related to garnering client signatures. To help clarify the requirements, one of our top stories addresses the signature form (Form 8879).

Financial Literacy
As CPAs step forward to educate Americans on financial topics that apply to different life stages, the MACPA continues its important initiatives. Read this story on our financial literacy efforts to see the difference Michigan CPAs are making in our own communities.

MACPA volunteers and staff are very active on the state and national level in these important initiatives and we know how important it is to keep you informed. It is equally important for us to hear from you. If you have questions, concerns or ideas to share, please feel free to contact me or MACPA President Peggy Dzierzawski.

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