Construction Contractors: Special Tax and Accounting Considerations Webcast

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Overview

8.0 Credits
ONLINE

This course explains and illustrates special accounting and auditing issues related to the construction industry, contractor specific disclosure rules, and current accounting and auditing developments.

On the tax side, the program examines the similarities and differences of tax and financial reporting for percentage of completion and completed contract method, and other permitted methods of accounting. Adjustments for the “look back” rules will be considered under various scenarios.

Attention is paid to current tax issues involving the Section 199 deduction and Worker Classification. Practical application is provided through audit program examples and financial statement presentation and disclosure issues.

Objectives

  • Understand the definition of “long term contract”
  • Present a contractor’s financial information in accordance with U.S GAAP
  • Calculate a contractor’s bonding capacity
  • Calculate “look-back” adjustments to taxable income
  • Calculate IRC Sec. 199 “Qualified Domestic Production Deduction”
  • Apply IRC Secs. 263A and 460 to cost accumulation
  • Efficiently audit a contractor
  • Plan financial and tax transactions to assure maximum bonding capacity
  • Advise contractors on how business decisions affect financial statements and tax returns
  • Comply with new tax and accounting rules

Major Topics

Accounting:

  • Over and under billings
  • New revenue recognition standard and new lease standard for contractors
  • Consolidation of variable interest entities
  • Deferred income taxes
  • Disclosure of risk and uncertainty
  • Audit program for contract related items, applying risk analysis to contractors’ operations, and required disclosures

Tax:

  • Cash versus accrual
  • Accounting methods available to small contractors
  • Percentage of completion vs. completed contract
  • “Look back” rules
  • AMT
  • Sec. 460 regulations on accumulation of contract costs
  • Homebuilder/developer regulations, and the IRS Audit Techniques Guide for the construction industry IRS Audit
  • Techniques Guide for the construction industry

Designed For

Accountants, CPAs and tax practitioners.

Prerequisite

Two to five years of tax experience.

Advanced Preparation

None.