Tax and Accounting Desk

Jen: This is The PKF Texas – Entrepreneur’s Playbook®. I’m Jen Lemanski and I’m back once again with Carlos Gomez, an audit manager, and one of the faces of PKF Texas’ Contract Compliance Services team. Carlos, welcome back to The Playbook.

Carlos: Thanks for having me, Jen.

Jen: So, we’ve been talking about different kind of audits throughout the series, and how about you share a little bit about what a royalty audit is.

Carlos: A lot of royalty audits that we performed is on behalf of a client who is not necessarily in a certain industry, whether it be consumer goods, toys, apparel, those types of things. And for this specific instance, we have a client who is in the automotive industry, and a way to build their brand recognition and loyalty is to have toys and have apparel. And so, a kid gets a truck, and his dad has a Ford F-150, and they get a Ford F-150 toy car for Christmas. It kind of builds that loyalty and brand loyalty.

Jen: So, when they’re building that brand loyalty, where does the royalty audit come in?


Continue Reading Royalty Audit – What is it and What are the Benefits?

There’s a new IRS form for business taxpayers that pay or receive certain types of nonemployee compensation and it must be furnished to most recipients by February 1, 2021. After sending the forms to recipients, taxpayers must file the forms with the IRS by March 1 (March 31 if filing electronically).

a mini calendar reading "February 01" with 1099-NEC and 1099-MISC

The requirement begins with forms for tax year 2020. Payers must complete Form 1099-NEC, “Nonemployee Compensation,” to report any payment of $600 or more to a recipient. February 1 is also the deadline for furnishing Form 1099-MISC, “Miscellaneous Income,” to report certain other payments to recipients.

If your business is using Form 1099-MISC to report amounts in box 8, “substitute payments in lieu of dividends or interest,” or box 10, “gross proceeds paid to an attorney,” there’s an exception to the regular due date. Those forms are due to recipients by February 16, 2021.


Continue Reading Due Soon: New Form 1099-NEC and Revised 1099-MISC

Thumbnail cover of PKF Texas' Fiduciary Fraud Checklist for retirement plansSeveral of our clients have inquired about a fraud checklist they can use for their retirement plans, so we’ve developed a handy tool for companies to reference. The goal for using PKF Texas’ Fiduciary Fraud Checklist is to help mitigate fraud, risk and errors and avoid negative consequences, such as money being stolen. Audit Senior

Jen: This is The PKF Texas – Entrepreneur’s Playbook®. I’m Jen Lemanski, and I’m back again with Carlos Gomez, an audit manager and one of the faces of the PKF Texas Contract Compliance Services team. Carlos, welcome back to The Playbook.

Carlos: Hey Jen. Thank you.

Jen: In a previous episode, we talked about operational management audits, and you mentioned about findings and how we could find up to 10%. That sounds like a lot to me. What do we do in that process and what do findings look like?

Carlos: When we say 10% like that, that’s an industry standard throughout most contract compliance engagements. It’s 10% upon the amount of what we’re auditing or what our coverage is; whether it be gross sales or royalties, 10% is what we typically see. But we’ve had cases where certain clients I’ve seen have recovered 45% up to 100%, and that includes interest and audit fees on top of that, once those are recovered, because they meet a certain threshold within the agreement that now that third party is responsible for the fees. And then another great thing to keep in mind, too, is that the return on investment, like, our fees are never going to encompass the total amount that we find for you.

Jen: So, when we say recovered fees, what does that exactly mean? Is it something that was missing in the contract? Was it something that one of the parties didn’t do? Explain what that looks like.


Continue Reading Recovering Fees in Operational Management Audits – A Closer Look

Data analytics can actually save not-for-profits time and effort, because it helps prevent bad decisions that must later be revisited and revised. Most not-for-profit organizations collect vast volumes of data, but according to a study conducted by EveryAction and Nonprofit Hub, only 40% of not-for-profits regularly use that data to drive decisions.

a person working on a laptop with data bar graphs and pie charts on screen; image used for blog post about data analytics helping not-for-profit decisions

The majority of organizations that don’t analyze and apply data say they lack the time or staff to dedicate to it.

Here’s how data analytics can help with decision making:


Continue Reading How Data Analytics Helps Decision Making

Attending college and pursuing higher education is one of the biggest investments that parents and students ever make. If you or your child (or grandchild) attends (or plans to attend) an institution of higher learning, you may be eligible for tax breaks to help foot the bill.

girl sitting on her bed with a laptop and textbooks; image used for blog post about revised tax breaks for higher education

The Consolidated Appropriations Act, which was enacted recently, made some changes to the tax breaks.

Here’s a rundown of what has changed.


Continue Reading Understanding Revised Tax Benefits for Higher Education

Jen: This is The PKF Texas – Entrepreneur’s Playbook®. I’m Jen Lemanski, and I’m here with Kristin Ryan, an Audit Senior Manager and one of the faces of the PKF Texas Employee Benefit Plan Team. Kristin, welcome back to The Playbook.

Kristin: Thanks. Good to be back.

Jen: So, in the past, we’ve talked about fiduciaries, risk, that kind of thing, and I’ve heard that there’s been some litigation against fiduciaries. What kind of issues are you seeing in this space right now?


Continue Reading Reducing Risk of Litigation Against Fiduciaries

cover of PKF Texas' 2021 SEC Filing Reference GuideWe have updated our website’s SEC Desk with the 2021 SEC Filing Reference Guide, which is ready to access and download. This update summarizes the U.S. Securities and Exchange Commission’s 2021 calendar year filing deadlines. While there are no significant changes to the due dates for the new filing year, several of the dates fall

Jen: This is The PKF Texas Entrepreneur’s Playbook. I’m Jen Lemanski, and I’m back again with Carlos Gomez, an Audit Manager and one of the faces of our PKF Texas Contract Compliance Services team. Carlos, welcome back to the Playbook.

Carlos: Hi, Jen.

Jen: Can you give me a little bit of background – what is a management or an operational agreement audit?

Carlos: What these typically entail is we have a client who has a third party that manages – whether it’s residential or commercial buildings – for them and their tenants.

Jen: What types of things are involved in this audit? Are there any risks associated with doing this type of audit?


Continue Reading Navigating Management Operational Agreement Audits