As a professional services organization ourselves, White Nelson Diehl Evans is dedicated to providing high quality, client focused tax, financial accounting and advisory services to assist the many professional services firms whom we serve:

  • Law Firms
  • Engineering Firms
  • Architectural Firms
  • Property Management
  • Advertising and Marketing
  • Staffing Companies
  • Consulting Services
General Principles of Revenue Recognition

The standard principles of revenue recognition have been fairly straight-forward under the two basic methods of accrual and cash basis accounting. Under the accrual method, income is recognized when the service or product is provided regardless of whether the payment has been received from the customer. Under the cash basis, revenue is only recognized when the payment has been received from the customer. This is the most simplistic description of revenue recognition rules, however the new revenue standard issued through the Accounting Standards Codification (ASC) 605-10 attempts to reconcile US GAAP with international standards on revenue recognition from contracts with customers. These new standards must be adopted by non-public companies January 1, 2019.

Some industries account differently for transactions that are economically similar and ASC 605-10 seeks to eliminate the industry specific guidance and rely more on professional judgment and contract terms and conditions. A potential consequence of this change is that accountants and lawyers may play a key role in how contracts are drafted to determine when revenue is recognized. The standard establishes a five-step model for revenue recognition. First, a company must identify the contract with the customer; second it must identify the performance obligations in the contract; third determine the transaction price; fourth allocate the transaction price to separate performance obligations and finally, recognize revenue as each performance obligation is satisfied.

The adoption of these new standards may present implementation considerations and challenges. White Nelson Diehl Evans has the experience and expertise to help our clients evaluate and address the impact of the new standard to your company’s processes, data systems and controls.

Compensation Plans and Benefits

The professional service industry has grown to over 19 million employees in January 2016 representing 1.7 million firms generating well over $1 trillion dollars of annual revenue. This growth trend will continue as technology markets mature and revenue streams become more service intensive. The compensation and benefits professionals at White Nelson Diehl Evans will work with your company to develop customized compensation and benefit plans that support your business goals.

Compensation and reward programs must do more than just drive your business. Top business leaders understand that human capital is a strategic asset and in order to be successful, companies need to attack the complexities of compensation plans at all key employee levels. There are a myriad of payment structures that a company can employ to reward and retain key employees such as salary, commission, stock, incentive plans, deferred compensation plans, etc. Making sure you maximize your return on investment and maintain a competitive advantage requires a holistic approach that starts with the hiring/vetting process all the way through the employee exit.

Human Resources includes best practice review, policies and procedures and performance management. Most importantly, it’s how you track and measure performance against results in order to drive the most value from your compensation dollars. Custom packages should reflect the relative value of key employees to the organization and be designed to accurately express the employee value to the organization and encourage them to stay for many years.

Managing compensation plans and benefits can be a daunting task. For clients needs ranging from custom plan design, payroll consulting, review of qualified plans, health and welfare plans and nonqualified deferred compensation plans, the dedicated professionals at White Nelson Diehl Evans can help. Compliance with relevant regulations such as IRC Section 409A will make sure you avoid any penalties and meet the requirements to have no effect on employee’s taxes.

Perspectives

Partner Profile: Erin Johnson

4/20/18

Erin Johnson is a tax and advisory services partner. In this role, she manages client engagements, helps develop the staff and managers at the firm and provides clients with specific guidance on...

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Employee Benefit Plan Compliance Checklist for Plan Fiduciaries

4/19/18

For plan executives, fiduciary awareness is critical. What you don't know can hurt your plan, your participants and you personally. Under the Employee Retirement Income Security Act of 1974...

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Tax Reform and a Fresh Look at Business Entity Selection

3/26/18

To “C” or Not to “C?” As you know, sweeping tax reform was passed into law late last year. This legislation, known as The Tax Cuts and Jobs Act (TCJA), modified both C corporation and...

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Tax Planning Guide

At White Nelson Diehl Evans, we know how difficult it is to stay ahead of the complex and dynamic tax laws. From new standards changing revenue recognition rules to the impact of the Affordable Care Act, our goal is to help our clients stay in front of tax issues that impact your bottom line. To help in this effort, we have put together a comprehensive tax-planning guide and it’s available to download for free.

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Partner Testimonial

“As a dedicated professional services firm, we consider it our role, not only to deliver high quality tax, accounting and advisory services, but also that our obligation is to act as advocates for our clients. We are a “go to” resource for complex financial issues, and are always available on a real-time, as needed, basis. We partner with our clients to meet compliance requirements, positively impact the bottom line, and minimize taxes.” ​​

Dave Krickl Tax Partner
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