Posts Tagged ‘Works’

Accredited In Business Valuation (ABV)

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Accredited In Business Valuation (ABV)

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What Does Accredited in Business Valuation Mean?

Accredited in Business Valuation (ABV) is a professional designation awarded to a certified public accountant (CPA), who specializes in calculating businesses’ value. The ABV certification is overseen by the American Institute of Certified Public Accountants (AICPA). It requires candidates to complete an application process, pass an exam, meet the minimum business experience and education requirements, and pay a credential fee. As of 2021, the annual fee for the ABV Credential was $380.

Maintaining the ABV credential also requires those who hold the certification to meet minimum work experience standards and lifelong learning. Successful applicants earn the right to use the ABV designation with their names, improving job opportunities, professional reputation, and pay.

Key Takeaways

  • Accredited in Business Valuation (ABV) is a professional designation awarded to certified public accounts specializing in business valuation.
  • ABV professionals must complete 60 hours of continuing professional education every three years to keep their designation.
  • CPAs seeking an ABV certification must meet educational and professional metrics before they are eligible for the designation.

What is a Business Valuation?

How Accredited in Business Valuation Works

The Accredited in Business Valuation credential is awarded to CPAs who demonstrate considerable knowledge, skill, and business valuation experience. The study program to become an ABV covers the basic business valuation process, professional standards, qualitative and quantitative analysis, valuation analysis, and other related topics, such as financial reporting and litigation.

Individuals with the ABV designation may work for business valuation firms, consulting firms, and other businesses that regularly deal with business value.

Accredited in Business Valuation Requirements

Candidates seeking ABV accreditation must have a valid (and unrevoked) CPA license or certificate issued by the appropriate state authority. They must also pass the ABV Examination, with some exceptions. For example, this requirement is waived in the case of AM (Accredited Member of the ASA) and ASA (Accredited Senior Appraiser) credential holders of the American Society of Appraisers, CFA (Certified Financial Actuary) holders, and CBV (Chartered Business Valuator) credential holders of the Canadian Institute of Chartered Business Valuators.

Every three years, ABV professionals must complete 60 hours of continuing professional education. They must also pay an annual fee of several hundred dollars.

Business Experience and Education Requirements For Candidates

Business Experience

ABV candidates must have obtained a minimum of 150 hours of BV experience within the five years preceding the credential application date. Candidates may also apply a maximum of 15 experience hours by completing the hands-on business valuation case study track at the AICPA Forensic and Valuation Services Conference.

Education Requirement

ABV candidates must complete 75 hours of valuation-related continuing professional development (CPD). All hours must be obtained within the 5-year period preceding the date of the ABV application.

Accredited In Business Valuation Exam

The ABV Exam is conducted by computer and consists of two parts. Both parts must be passed in 12 months (based on passing the first part) to receive ABV credit.

Applicants are given three hours and 15-minutes to complete each section of the test, including a 15-minute break. The exam consists of 90 multiple-choice questions per module, and much of the exam are discrete multiple-choice questions (78 in total). A dozen questions are case studies with accompanying multiple-choice answers. These questions are meant to test a candidate’s analytical aptitude and apply valuation theory and methodology.

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Affirmative Action: What Is Affirmative Action? Definition, How It Works, and Example

Written by admin. Posted in A, Financial Terms Dictionary

What Is Affirmative Action? Definition, How It Works, and Example

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What Is Affirmative Action?

The term affirmative action refers to a policy aimed at increasing workplace and educational opportunities for people who are underrepresented in various areas of our society.

Affirmative action focuses on demographics with historically low representation in leadership, professional, and academic roles. It is often considered a means of countering discrimination against particular groups.

Affirmative action programs are commonly implemented by businesses and governments by taking individuals’ race, sex, religion, or national origin into account when hiring.

Key Takeaways

  • Affirmative action seeks to reverse historical trends of discrimination against individuals with certain identities.
  • It provides financial assistance to groups that historically have been and continue to be subjected to forms of discrimination.
  • Policies often implement hiring quotas, provide grants and scholarships, and may also deny government funding and contracts to institutions that fail to follow policy guidelines.
  • Affirmative action now includes assistance for gender representation, people with disabilities, and covered veterans.
  • Criticism of affirmative action emphasizes high program costs, the hiring of fewer qualified candidates, and a lack of historical progress in equal representation.

How Affirmative Action Works

The main purpose of affirmative action is to diversify various parts of society. It is a government-backed policy that was developed to provide inadequately represented groups of people with access to opportunities in academia, the private workforce, and government jobs.

These opportunities include admission to schools and jobs in professional positions, as well as access to housing and financing.

History and Implementation

The affirmative action policy rose to prominence in the United States in the 1960s as a way to promote equal opportunity for various segments of society. The policy was developed to enforce the Civil Rights Act of 1964, which sought to eliminate discrimination.

Early implementations of affirmative action largely focused on halting the continued social segregation of minorities and other disadvantaged individuals from institutions and opportunities.

Despite legislation that outlawed discrimination practices in the U.S., tangible change in the status quo was not immediate.

In more recent years, campaigns have expanded to make organizations and institutions even more inclusive by pushing for greater gender diversity. Newer policies are also aimed at providing more access to opportunities for covered veterans and people with disabilities.

Covered veterans are veterans who are disabled, who served on active duty in a war or other campaign and have a campaign badge or a service medal, or who are recently separated from the Armed Forces.

Elements of Affirmative Action

Efforts to stimulate change can take the form of financial assistance such as grants, scholarships, and other support earmarked to help with access to higher education opportunities.

In addition, hiring practices may be structured to require the inclusion of diverse candidates for consideration for job openings. Government agencies may mandate that companies and institutions populate their ranks with a minimum percentage of qualified professionals from varying ethnicities, genders, and cultures.

Failure to meet such requirements could disqualify institutions from receiving government funding or being able to compete for public contracts.

People confuse employment equity with affirmative action. There’s a distinct difference between the two. Employment equity attempts to ensure that all individuals are treated equally while affirmative action actually supports those people in particular who historically have been denied opportunities.

Examples of Affirmative Action

Affirmative action has been put to work since the 1960s, despite lack of progress at times and rulings by legal authorities such as the Supreme Court that have hindered it. Here are some examples of the policy in action.

  • In 1965, President Lyndon B. Johnson issued Executive Order 11246. It required that all government contractors and subcontractors expand job opportunities for minorities. It also established the Office of Federal Contract Compliance (OFCC) to enforce the order.
  • In 1970, the Labor Department ordered and authorized flexible goals and timetables to address the underutilization of minorities by federal contractors. In 1971, women were included in the order.
  • In 1973, President Richard M. Nixon signed the Rehabilitation Act of 1973. It required agencies to submit an affirmative action plan to the EEOC that detailed the hiring, placement, and advancement of individuals with disabilities.
  • In 1983, President Ronald Reagan issued Executive Order 12432. It required every federal agency with substantial procurement or grant-making authority to develop a Minority Business Enterprise development plan.
  • In 1990, President George H.W. Bush signed the Americans with Disabilities Act. A year later, he signed the Civil Rights Act of 1991.
  • In 1998, the U. S. House of Representatives and the U. S. Senate stopped attempts to eliminate specific affirmative action programs. Both houses of Congress prohibited the abolishment of the Disadvantaged Business Enterprise program. In addition, the House refused to allow the elimination of affirmative action in admissions in higher education programs funded through the Higher Education Act.
  • In 2022, the Wall Street Journal reported that dozens of major U.S. companies including Apple, Alphabet, American Airlines, and General Motors were urging the Supreme Court to uphold the continued use affirmative action policies in college admissions. They asserted that greater diversity on college campuses contributed to ongoing innovation in commerce and successful business endeavors.

Advantages and Disadvantages of Affirmative Action

The implementation and continued use of affirmative action policies have drawn strong support as well as staunch criticism.

Advantages

An obvious benefit of affirmative action is the opportunities they provide to people who otherwise might not have them. These opportunities include access to education for students who may be disadvantaged and career advancement for employees who may be blocked from rising up the corporate ladder.

Proponents of affirmative action say that the effort must continue because of the low percentages of diversity in positions of authority and in the media, as well as limited acknowledgment of the achievements of marginalized or unrepresented groups.

Disadvantages

Opponents of affirmative action frequently call these efforts a collective failure. They cite as evidence the tiny changes to the status quo after decades of effort. The cost of such programs, coupled with a belief that affirmative action forces the populace to make unwarranted accommodations, drives a significant part of the opposition.

Certain individuals believe that there is little to no bias in society. They argue that affirmative action results in reverse discrimination, which can often lead to qualified candidates being overlooked in academics and the workplace in favor of less qualified candidates who meet policy standards.

Affirmative Action Statistics

Affirmative action is a very controversial topic and often leads to heated debates between those who support it and people who feel it doesn’t benefit society. Is there a way to quantify how people feel and how it’s working?

According to a Gallup poll, more than half of Americans (61%) believe in affirmative action policies. This level of support has increased since the last poll, where only 47% to 50% of individuals thought affirmative action was necessary. This increase in support is especially important, given the active issues surrounding race and identity in the U.S. and elsewhere.

Many Americans feel positive about diversity. They are comfortable with the makeup of their communities, saying diversity positively impacts society as a whole.

There is some divide when it comes to identifying race and ethnicity for purposes of hiring. In fact, about 74% of individuals feel that a candidate’s racial or ethnic background shouldn’t be considered when hiring or promoting them. These activities should only be based on someone’s merit and qualifications.

What Is the Goal of Affirmative Action?

The goal of affirmative action is to increase opportunities for individuals and groups that historically have been underrepresented or, in some cases, barred, from certain areas of academia, the government, and the private sector workforce. Affirmative action policies provide funding in the form of grants and scholarships to these communities.

Policies were adopted to help those from different racial backgrounds and national origins. They have expanded to address gender, sexual orientation, and various disabilities.

What Has Been the Result of Affirmative Action Policies in Higher Education?

Affirmative action policies have helped diversify higher education. When first adopted, the student body at most higher education institutions was primarily white. That has changed, leading to more diverse and vibrant student populations across the country.

How Did Regents v. Bakke Change Affirmative Action Policies?

The Regents v. Bakke case changed affirmative action policies by striking down the use of racial quotas. The case was presented by Allan Bakke, who claimed he was denied admission to medical school at the University of California on two separate occasions because he was white. The Supreme Court ruled in Bakke’s favor, saying racial quotas were unconstitutional.

Which U.S. President First Defined and Used the Term Affirmative Action?

That was President John F. Kennedy. He did so in 1961, telling federal contractors to take “affirmative action to ensure that applicants are treated equally without regard to race, color, religion, sex, or national origin.”

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Appropriation Account: Definition, How It Works, Example

Written by admin. Posted in A, Financial Terms Dictionary

Appropriation Account: Definition, How It Works, Example

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What is an Appropriation Account?

Appropriation is the act of setting aside money for a specific purpose. In accounting, it refers to a breakdown of how a firm’s profits are divided up, or for the government, an account that shows the funds a government department has been credited with. A company or a government appropriates funds in order to delegate cash for the necessities of its business operations. 

How Appropriation Accounts Work

In general accounting, appropriation accounts are mainly prepared by partnerships and limited liability companies (LLCs). They are an extension of the profit and loss statement, showing how the profits of a firm are allocated to shareholders or to increase reserves indicated in the balance sheet. A company might appropriate money for short-term or long-term needs to finance things such as employee salaries, research and development, and dividends.

For a partnership, the primary purpose of the appropriation account is to show how profits are distributed among the partners. For an LLC, the appropriation account will start with profits before taxes and then subtract corporate taxes and dividends to arrive at retained profits.

Government appropriation accounts come into play when they create their budgets. Appropriation credits are taken out of estimated revenues from taxes and trade and allocated to the proper agencies. Credits in appropriation accounts that are unused may be redistributed to other agencies or used for other purposes.

Appropriations for the U.S. federal government are decided by Congress through various committees. The U.S. government’s fiscal year runs from October 1 through September 30 of each calendar year.

Key Takeaways

  • Appropriation accounts show how companies and governments distribute their funds.
  • Companies and governments appropriate funds in order to delegate cash for the necessities of business operations.
  • In general accounting, appropriation accounts are mainly prepared by partnerships and limited liability companies.
  • Government appropriation accounts come into play when they create their budgets. Appropriation credits are taken out of estimated revenues from taxes and trade and allocated to the proper agencies.

Real World Example of Appropriation Accounts

Investors can monitor appropriations of publicly listed corporations by analyzing their cash flow statements (CFS). The CFS shows if a firm is generating enough cash to pay its debt obligations and fund its operating expenses.

Here’s a breakdown of how Tobacco giant Altria Group Inc. (MO), a popular income stock, appropriated its cash and profits in the nine months to Sep. 30, 2018.

SEC​ company filing

https://www.sec.gov/Archives/edgar/data/764180/000076418018000095/a2018form10qq32018.htm


SEC​ company filing

https://www.sec.gov/Archives/edgar/data/764180/000076418018000095/a2018form10qq32018.htm


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Anti-Dumping Duty: What It Is, How It Works, Examples

Written by admin. Posted in A, Financial Terms Dictionary

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What Is an Anti-Dumping Duty?

An anti-dumping duty is a protectionist tariff that a domestic government imposes on foreign imports that it believes are priced below fair market value. Dumping is a process wherein a company exports a product at a price that is significantly lower than the price it normally charges in its home (or its domestic) market.

Key Takeaways

  • An anti-dumping duty is a protectionist tariff that a domestic government imposes on foreign imports that it believes are priced below fair market value.
  • In order to protect their respective economy, many countries impose duties on products they believe are being dumped in their national market; this is done with the rationale that these products have the potential to undercut local businesses and the local economy.
  • While the intention of anti-dumping duties is to save domestic jobs, these tariffs can also lead to higher prices for domestic consumers.
  • In the long-term, anti-dumping duties can reduce the international competition of domestic companies producing similar goods.
  • In the U.S., the International Trade Commission (ITC)–an independent government agency–is tasked with imposing anti-dumping duties.
  • The World Trade Organization (WTO)–an international organization that deals with the rules of trade between nations–also operates a set of international trade rules, including the international regulation of anti-dumping measures.

In order to protect their respective economy, many countries impose duties on products they believe are being dumped in their national market because these products have the potential to undercut local businesses and the local economy.

Understanding Anti-Dumping Duties

In the U.S., the International Trade Commission (ITC)–an independent government agency–is tasked with imposing anti-dumping duties. Their actions are based on recommendations they receive from the U.S. Department of Commerce and investigations by the ITC and/or the Department of Commerce. 

In many cases, the duties imposed on these goods exceeds the value of the goods. Anti-dumping duties are typically levied when a foreign company is selling an item significantly below the price at which it is being produced.

While the intention of anti-dumping duties is to save domestic jobs, these tariffs can also lead to higher prices for domestic consumers. And, in the long-term, anti-dumping duties can reduce the international competition of domestic companies producing similar goods.

The World Trade Organization (WTO) is an international organization that deals with the rules of trade between nations. The WTO also operates a set of international trade rules, including the international regulation of anti-dumping measures. The WTO does not intervene in the activities of companies engaged in dumping. Instead, it focuses on how governments can—or cannot—react to the practice of dumping. In general, the WTO agreement permits governments to act against dumping “if it causes or threatens material injury to an established industry in the territory of a contracting party or materially retards the establishment of a domestic industry.”

This intervention must be justified in order to uphold the WTO’s commitment to free-market principles. Anti-dumping duties have the potential to distort the market. In a free market, governments cannot normally determine what constitutes a fair market price for any good or service.

Example of an Anti-Dumping Duty

In June 2015, American steel companies United States Steel Corp., Nucor Corp., Steel Dynamics Inc., ArcelorMittal USA, AK Steel Corp., and California Steel Industries, Inc. filed a complaint with the U.S. Department of Commerce and the ITC. Their complaint alleged that several countries, including China, were dumping steel into the U.S. market and keeping prices unfairly low.

After conducting a review, one year later the U.S. announced that it would be imposing a total of 522% combined anti-dumping and countervailing import duties on certain steel imported from China. In 2018, China filed a complaint with the WTO challenging the tariffs imposed by the Trump administration. Since then, the Trump administration has continued to use the WTO to challenge what it claims are unfair trading practices by the Chinese government and other trading partners.

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