The progressive tax system is widely used around the world. It is based on the idea that the more taxable income or profit an individual makes the higher the rate of tax they should pay. The way this system should work is that those who earn the least amount of money should have to pay the least amount of tax – they will pay a lower percentage of tax on their income than the high earners. It is viewed as fair system by many but there are also critics who believe that taxing the rich too much stifles the economy. Read the rest of this entry »
Public sector entities in the United States require their own system for accounting. These will be used in all state, federal, and local agencies. Government accounting has its own principles and guidelines. These are provided by the Federal Accounting Standards Advisory Board (FASAB) or the Governmental Accounting Standards Board (GASB). Federal agencies will rely on the guidelines provided by the FASAB while other public agencies will use GASB guidelines.
The best advice a finance advisor can give a client is to have a diversified investment portfolio. This means that there should be a variety of investments that run along a continuum of risk, i.e. some investments will carry more risk than others.
When working with budgets, the aim of the exercise is to have enough money to pay debts and bills, as well as some money over for unexpected events. Usually this is achieved relatively easily as budgets are adapted to conform to the amount of money available. There are, however, situations when there is a deficit in the budget, i.e., there is a gap between the money that you collected (or are paid) and the amount of money that you need to meet your budgetary commitments.
The simplest way to explain an IRA would be to say that it is a retirement account that provides tax advantages. IRA stands for Individual Retirement Account. A lot of people may view an IRA as an investment but this isn’t really correct; it would be better to say that an Individual Retirement Account is a basket where you can hold your investments. This type of account covers a wide range of possibilities and the one you will choose will very much depend on your exact needs.
Cenvat is an acronym for Central Value Added Tax. It is similar in many respects to another type of tax system called Value Added Tax (VAT). Cenvat is used by a lot of European countries and other places such as India. This form of taxation is said to have many benefits over other types of tax systems – in particular it minimizes the cascading effect that occur with other types of tax systems and people feel that it is a lot fairer. Read the rest of this entry »
Those people who are interested in public accounting will find that there are quite a number of good books available on the subject. This is an important area of accounting and some of the best minds in the field have shared their knowledge in these texts. A lot of the texts focus on public finance in general but contain invaluable knowledge of use to those interested in public accounting. Here are just five of the best public accounting books reviewed.
Unaccountable: How the Accounting Profession Forfeited a Public Trust by Mike Brewster (2003)
Quantitative Easing is essentially the creation of money. As we live in a digital age, the money is not even printed any more but simply created on computers. How come we aren’t seeing prices rise?