• Offering cost-effective, quality audit and tax services.
  • Building long-term and effective professional relationships.
  • Serving the greater Chicago area and beyond.
Accounting Auditing Tax Services

Experience Counts

Welcome to Sassetti LLC !

 
Sassetti LLC is a full-service Certified Public Accounting Firm with a ninety year tradition of quality professional services.  Our clients include businesses, both privately-held and publicly traded, not-for-profit organizations, employee benefit plans and individuals.
 
Sassetti LLC was originally founded in 1921, and has been located in Oak Park, Illinois since 1964.
 
We are members of the American Institute of Certified Public Accountants, the Illinois CPA Society, the Center for Public Company Audit Firms and the AICPA Employee Benefit Quality Center.



Protecting Americans from Tax Hikes Act of 2015

January 2016 
 

 

 

News & Alerts

January 11, 2016 - Sassetti LLC is pleased to announce its recent merger with Brennan & Brosnan LLC, located in Naperville, Illinois. The acquisition, which was effective January 1, 2016, expands Sassetti’s accounting, auditing, and tax practice into the western suburbs. Sassetti will add seven new employees, including the two partners, Margaret Brennan and Betsy Brosnan, and will maintain the Brennan & Brosnan practice location in the I-88 corridor.

Brennan & Brosnan was established in 1994 and has been recognized as a leading firm in the Naperville area serving the tax and business advisory needs of entrepreneurial businesses and their owners. In 2005 the firm was named as a Naperville Small Business of the Year Award Winner. Brennan & Brosnan provides tax planning, tax preparation, estate planning and estate administration services to individual clients and companies in a variety of industries. 

Tax News

Tue, 09 Feb 2016 05:00:00 GMT

31 Countries Sign Tax Co-Operation Agreement to Enable Automatic Sharing of Country-By-Country Reports


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Summary

On January 27, 2016, the Organisation for Economic Cooperation and Development (“OECD”) announced that 31 countries have signed the Multilateral Competent Authority Agreement (“MCAA”), which will allow automatic sharing of Country-by-Country (“CbC”) reports.


Details

In an unprecedented move towards implementation of the new CbC transfer pricing reporting requirements developed under Action Item 13: Guidance on Transfer Pricing Documentation and Country-by-Country Reporting of the OECD/G20 Base Erosion and Profit Shifting Project (the BEPS Project), 31 countries signed the MCAA, a tax cooperation agreement that will allow for automatic exchange of CbC reports. The signing of the MCAA is part of continuing efforts by tax administrations to make it harder for multinational enterprises (“MNEs”) to engage in cross-border corporate tax avoidance. The 31 countries that are signatories to the MCAA are:
 
Australia
Austria
Belgium
Chile
Costa Rica
Czech Republic
Denmark
Estonia
Finland
France
Germany
Greece
Ireland
Italy
Japan
Liechtenstein
Luxembourg
Malaysia
Mexico
Netherlands
Nigeria
Norway
Portugal
Slovak Republic
Slovenia
South Africa
Spain
Sweden
Switzerland
United Kingdom


 

Action Item 13 seeks to enhance transparency of MNEs by providing tax administrations with adequate information to conduct transfer pricing risk assessments and audits. It contains detailed recommendations for transfer pricing documentation, including the new CbC reporting. Specifically, MNEs with consolidated annual revenues equal to or in excess of €750 million will be mandated to file CbC reports with tax administrations in their country of residence, disclosing specific information including identification of each entity within the MNE group operating in a particular tax jurisdiction, and information about the business activities each entity is engaged in. In his speech at the signing ceremony, the OECD Secretary-General Angel Gurria stated that under the MCAA, tax authorities will have “a single, global picture on the key indicators – profits, tax, and economic activities – of multinational businesses… allowing them to better assess transfer pricing and other BEPS risks, and deploy audit resources where they will be most effective.”

The OECD recommended that the first CbC reports be filed for MNEs with fiscal years beginning on or after January 1, 2016, and that MNEs be allowed one year from the close of the fiscal year to which the CbC report relates to prepare and file it, meaning the first reports are expected to be filed by December 31, 2017, for calendar year MNEs.

Under the MCAA, the information collected through the CbC report by an MNE’s country of residence will be automatically exchanged with other countries in which the MNE operates that are also party to the MCAA. The MCAA also allays concerns of many businesses about tax and commercially-sensitive information by ensuring that the confidentiality of such information is safeguarded. The first exchanges under the MCAA are expected to start in 2017/2018 on the 2016 tax year information.  

The next step in the process is the development of an electronic data transmission platform with encryption and a related User Guide to facilitate the electronic exchange of the CbC reports.


BDO Insights

The signing of the MCAA reaffirms the anticipation that many countries are moving forward with implementation of the CbC reporting requirements consistent with recommendations under OECD Action Item 13. The U.S. Treasury Department and Internal Revenue Service have signaled the United States’ commitment to Action Item 13 recommendations with the release of Proposed Regulations on CbC reporting in December 2015. The implication for United States resident MNEs remains unclear until the regulations are finalized or further guidance is provided with regards to obligations of United States MNEs.

It should be noted that where information cannot be exchanged, Action Item 13 provides an alternative filing approach tagged the ”secondary mechanism,“ which transfers the filing obligation to a ”constituent entity” of an MNE group operating in a country adopting the OECD’s recommendation. United States MNEs that have business operations in any of the 31 countries that are signatory to the MCAA can anticipate their constituent entities may be required to file CbC reports for the 2016 tax year. The MNEs should start assessing their ability to comply with the CbC reporting requirements as well as the potential for increased transfer pricing disputes and penalties for non-compliance.
 

For more information, please contact one of the following practice leaders:
 

Robert Pedersen
International Tax Practice Leader

 

William F. Roth III
Partner


 

Bob Brown
Partner

 

Jerry Seade
Principal


 
Scott Hendon
Partner
 

Joe Calianno
Partner and International Technical
Tax Practice Leader


 
Monika Loving
Partner
 

Michiko Hamada
Senior Director


 
Brad Rode
Partner
  Chip Morgan
Partner

 
Veena Parrikar
Principal
  Sean Kim
Senior Director, Transfer Pricing

Tue, 09 Feb 2016 05:00:00 GMT

Michigan Enacts Unclaimed Property Streamlined Audit Process and $25 Exemption


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Summary

On December 22, 2015, Michigan Governor Rick Snyder (R) signed into law Senate Bill 538, 98th Leg., Reg. Sess. (Mich. 2015), Public Act 242 of 2015, which enacts an unclaimed property exemption for property valued at $25 or less and the option for “eligible holders” to elect into a payor-friendly, streamlined audit process.  These provisions of the law are retroactively effective with respect to audits in progress as of August 15, 2015.
 

Details

Exemption for Property Valued at $25 or Less

The law limits the property which is subject to escheat to that which is valued at more than $25.  This limitation does not apply to dividends or an ownership interest in a nonpublic corporation, joint stock company, investment company, business trust, partnership, or business association.

Streamlined Audit Process for “Eligible Holders”

The law provides that the following “eligible holders” may make an election to participate in a streamlined audit process:
  • A business whose principal place of business is in the state as evidenced by 20 percent of property (excluding inventory or rented property) or payroll in Michigan, or a majority of officers that direct, control and coordinate activities of the business in the state; and
  • A corporation that wholly owns, or is owned by, a Michigan corporation that has its principal place of business in the state.

An election made by an “eligible holder” to participate in the streamlined audit process results in:
  • A reduction in the general 10-year lookback and the 5-year lookback period that applies to transactions between certain businesses to four years after the duty to escheat arose (see M.C.L. § 567.250);
  • Excluding checks voided within 180 days from the date of issuance from examination; and
  • An examination conducted within a time frame jointly developed by the holder and the state treasurer with the goal of completing the examination within 18 months.

Electing into the streamlined audit process requires executing a nondisclosure agreement within 30 days from the receipt of an audit notice.


BDO Insights

  • A reduction in the lookback period to four years for most unclaimed property, and the possibility of completing an audit within 18 months if the streamlined audit process is elected, can be very favorable terms in the unclaimed property world.  An unclaimed property holder that qualifies as an “eligible holder” should closely monitor the receipt of an audit notice, and act quickly to make the election into the program due to the 30-day window. 
  • An unclaimed property holder that has substantial property valued at $25 or less, including one that is currently being audited by Michigan in an audit that was in progress as of August 15, 2015, should scrutinize the state’s extrapolation to make sure this now exempt property is not included as this could have a significant impact on the assessment. 

BDO’s National Unclaimed Property Practice has handled hundreds of Michigan Voluntary Disclosures and audit related matters for clients and can assist you. Should you have any questions or would like to discuss escheatment, please contact:

Joseph Carr, Partner & National Unclaimed Property Practice Leader
(312) 616-3946  / jcarr@bdo.com.

Assurance News


Tue, 09 Feb 2016 05:00:00 GMT

Government Assistance (Topic 832): Disclosures by Business Entities About Government
Assistance (File Reference No. 2015-340)

BDO believes the costs of preparing the proposed disclosures about government assistance will exceed the related benefits.

Fri, 05 Feb 2016 05:00:00 GMT

SAB 74 Disclosures Related to Expected Accounting Standard on Leases  

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The FASB is expected to issue its new standard on leases in February.  When it does, SEC registrants will need to begin assessing their disclosures under Staff Accounting Bulletin No. 74 (codified in SAB Topic 11-M) in their next annual and interim filings, including annual reports on Form 10-K for the year ended December 31, 2015 which have not yet been filed with the SEC.  SAB 74 addresses disclosure of the impact that recently issued accounting standards will have on the financial statements of the registrant when adopted in a future period. 
 
Companies will understandably need time to assess the standard’s effects on their financial statements.  Accordingly, the initial SAB 74 disclosures about the standard’s effect may be general in nature.  Examples of disclosure that might be made in the initial reporting periods following the issuance of the new standard, depending on whether the entity is a lessee, lessor, or both are shown below (please note that a registrant must include actual ASU references):   
 
Lessees

In February 2016, the FASB issued Accounting Standards Update No. 2016-XX, Leases. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement.

The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.

[We are currently evaluating the impact of our pending adoption of the new standard on our consolidated financial statements.]

OR

[While we are still evaluating the impact of our pending adoption of the new standard on our consolidated financial statements, we expect that upon adoption we will recognize ROU assets and lease liabilities and that the amounts could be material.]
 

Lessors

In February 2016, the FASB issued Accounting Standards Update No. 2016-XX, Leases. The new standard requires a lessor to classify leases as either sales-type, finance or operating.  A lease will be treated as a sale if it transfers all of the risks and rewards, as well as control of the underlying asset, to the lessee. If risks and rewards are conveyed without the transfer of control, the lease is treated as a financing.  If the lessor doesn’t convey risks and rewards or control, an operating lease results.

The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessors for sales-type, direct financing, and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.
We are currently evaluating the impact of our pending adoption of the new standard on our consolidated financial statements.


These disclosures will be expected to evolve over time as companies begin to better understand how the standard will impact their financial statements.  As encouraged by SAB 74, registrants should also consider making disclosure of the potential impact of other significant matters that may result from the adoption of the standard (e.g. technical violations of debt covenants or planned changes in business practices).   

For questions related to matters discussed above, please contact Jennifer Kimmel or Jeff Lenz.

General Business News