Audit & Assurance
We provide an unbiased look at your financial and operational situation with our Audit and Assurance services for nonprofit and privately held organizations.
Audit & Assurance Services include:
- Audits, reviews and compilations
- Financial statements—audits, reviews, compilations
- Agreed upon procedures
- Internal audits
- Internal policies assurance
- Retirement plan audits
- Audit committee consulting
- Forecasts and projections
We offer specialized audit and assurance teams with in-depth experience in affordable housing, nonprofit organizations, financial institutions, healthcare providers and retirement plans.
We are committed to the highest standards in performing quality audits. Our commitment to quality and to the profession is illustrated by our participation as a reviewer in the American Institute of CPAs Peer Review Program.
We are proud to hold membership in the top industry assurance organizations:
The AICPA represents the CPA profession nationally regarding rule-making and standard-setting, and serves as an advocate before legislative bodies, public interest groups and other professional organizations.
The CAQ is an autonomous public policy organization dedicated to enhancing investor confidence and public trust in the global capital markets.
The EBPAQC is a voluntary membership organization for firms that perform ERISA employee benefit plan audits, established to promote the quality of employee benefit plan audits.
“Accounting is really about people and building rewarding relationships.”
— Fritz Duncan, CPA, Partner & Shareholder
Audit & Assurance Team
Fritz Duncan, CPA
Partner and Shareholder
Sara Hummel, CPA
Director of Quality Control
Evan Dickens, CPA
Partner and Shareholder
Jon Newport, CPA
Partner and Shareholder
Kari Young, CPA
Sarah Fantazia, CPA
Mathew Hamlin, CPA
Get in touch with us.
If you’re an executive or other key employee, you might be rewarded for your contributions to your company’s success with compensation such as restricted stock, stock options or nonqualified deferred compensation (NQDC). Tax planning for these forms of “exec comp,” however, is generally more complicated than for salaries, bonuses and traditional employee benefits.
And planning gets even more complicated if you could potentially be subject to two taxes under the Affordable Care Act (ACA): 1) the additional 0.9% Medicare tax, and 2) the net investment income tax (NIIT). These taxes apply when certain income exceeds the applicable threshold: $250,000 for married filing jointly, $125,000 for married filing separately, and $200,000 for other taxpayers.
Additional Medicare tax
The following types of exec comp could be subject to the additional 0.9% Medicare tax if your earned income exceeds the applicable threshold:
• Fair market value (FMV) of restricted stock once the stock is no longer subject to risk of forfeiture or it’s sold,
• FMV of restricted stock when it’s awarded if you make a Section 83(b) election,
• Bargain element of nonqualified stock options when exercised, and
• Nonqualified deferred compensation once the services have been performed and there’s no longer a substantial risk of forfeiture.
The following types of gains from stock acquired through exec comp will be included in net investment income and could be subject to the 3.8% NIIT if your modified adjusted gross income (MAGI) exceeds the applicable threshold:
• Gain on the sale of restricted stock if you’ve made the Sec. 83(b) election, and
• Gain on the sale of stock from an incentive stock option exercise if you meet the holding requirements.
Keep in mind that the additional Medicare tax and the NIIT could possibly be eliminated under tax reform or ACA-related legislation. If you’re concerned about how your exec comp will be taxed, please contact us. We can help you assess the potential tax impact and implement strategies to reduce it.
by Sophia Bennett
Sophia is a freelance business writer based in Eugene, Oregon. Her work has appeared in Oregon Business, 1859 Oregon’s Magazine and many other publications.
When an organization moves from having a small retirement plan to a large one – the Employee Retirement Income Security Act (ERISA) generally requires a retirement plan with 100 or more participants to have an audit of their plan performed by an external auditor. The purpose of the process is to make sure the retirement plan is operating according to plan guidelines and rules, complying with state and federal laws, and actually depositing the correct amount in each employee’s retirement account.
It’s wise to not wait until the company hits the 100 employee mark to start planning for the audit. Evan Dickens, a partner with Jones & Roth CPAs and Business Advisors, recommends that businesses start exploring the requirements when they reach around 80 staff members. That gives them time to determine when they will need the first audit, find a qualified CPA firm, and start pulling together all the necessary paperwork.
Evan Dickens, a partner with Jones & Roth CPAs and Business Advisors, recommends that businesses start exploring the requirements when they reach around 80 staff members.
Jones & Roth partner Jon Newport, CPA acknowledges that an audit can sound like a burden. However, he encourages companies to think of it as an opportunity. It gives them a chance to double-check that everyone really is receiving the money owed to them. “We’re doing it for the benefit of the participants,” he says. “They’re the stakeholders we’re most concerned with.”
Picking the right audit firm is key
Most companies will need their first benefit plan audit when they reach 100 employees, but this can vary based on the plan. And while a company may choose to pose this initial question to their existing auditor, don’t assume their firm is the best choice to perform the benefit plan audit. The U.S. Department of Labor (DOL), the government agency that requires the audits, shares the following on its website: “One of the most common reasons for deficient accountants’ reports is the failure of the auditor to perform tests in areas unique to benefit plan audits.” There are a lot of technical details the auditor must understand in order to complete the audit correctly. In fact, the DOL goes on to say that if a professional who is unfamiliar with these types of audits performs the review, that person should have an experienced benefit plan auditor review his or her work.
It makes sense to look for a company that specializes in the area. Jones & Roth is one example. They have established a niche practice in benefit plan audits and now have seven staff members devoted exclusively to working on them.
“We’ve made this area a focal point. It’s not just an afterthought for us,” Dickens says. Staff members within the niche are experts at reviewing the common 401(k) plans, but they’ve also worked with many defined benefit, employee stock ownership, 403(b), and health and welfare plans. A lot of other CPA firms won’t touch these more unusual, highly technical plans because they don’t have the expertise, Dickens notes. Jones & Roth is based in Oregon and performs more benefit plan audits than any other firm headquartered in the state.
Establish good communication between all partners
During the initial stages of the benefit plan audit it’s essential to establish good communication between the business’s plan administrator, the CPA firm and the TPA. The audit team needs access to a wealth of documents including payroll records, personnel files and other human resource data. “It can be a little intrusive for companies that are going through this for the very first time,” Dickens says. “Our focus is on working with companies to make it as gentle a process as possible the first time.”
It’s a good idea to make sure the CPA firm won’t wait until the last minute to complete the audit. October 15 is the deadline for TPA’s to submit all documentation to the Department of Labor. Many CPA’s tend to submit their audits to the TPA on October 14. Jones & Roth’s staff always aims to finish theirs by September 30.
Another way to glean more value from the audit is to see if the CPA firm can share any best practices or advice for improving the plan’s administration. Dickens and his staff try to do this with all their clients. “Companies want to do the right thing for their employees. They care about things like best practices and internal controls. We want to give them some confidence that they’re doing things the best way.”
The right firm may even have other helpful resources they can make available. Since Jones & Roth has its own retirement plan administration practice, Newport says that he often calls his colleagues when his clients have questions they’ve struggled to get their TPA to answer. “We can get them a much quicker, real-time, basically free response to a simple compliance question,” he says.
Making a positive impact
Dickens notes that he’s never identified a case where a retirement plan was trying to steal from its employees. But mistakes can happen, especially as retirement plans grow, which is why the audit requirement exists. “I can think of multiple occasions in the last year where we’ve identified that a participant received less of a contribution to their retirement plan than they should have. Sometimes it’s a relatively material amount. I’ve found cases where individual participants were shorted by four figures or more.”
Catching those errors is what Dickens says he likes best about his job. “I really enjoy the chance to make a positive impact on someone’s retirement account. When I’m able to correct those mistakes I feel like I’ve done some good.”
Sophia Bennett is a freelance business writer based in Eugene, Oregon. Her work has appeared in Oregon Business, 1859 Oregon’s Magazine and many other publications.