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DRAFT - -JULY 15, 2024

ACCT 583 – Income Tax Accounting and Auditing

This course provides a foundation preparing and analyzing the financial statement accrual of income taxes considering the applicable accounting standards, tax laws and financial auditing principles.

Syllabus Fall 2024 / August 26 – December 18

Section 14305D/Session 378 ONLINE MEETING – Tuesdays 5:30 – 7:00 p.m. PST via ZOOM

COURSE STRUCTURE:

The course material is organized into 14 Modules.  Module 7 is divided into two components: Module 7A and Module 7B.  On October 15, 2024, we will discuss Module 7B and also have a cumulative review of the material discussed to date.  This class will precede the availability of the Midterm Exam.

There will be a PowerPoint deck for each module which will contain an overview of the content to be covered.  This PowerPoint deck is part of your required reading.  A second PowerPoint deck, referred to as the “Interactive PowerPoint”, will contain questions, problems and short case studies for each module.  Students should thoroughly review the Interactive PowerPoint before attending our weekly Zoom session.  The Interactive PowerPoint will be the focus of our weekly Zoom sessions.  However, STUDENTS WILL NOT BE REQUIRED TO SUBMIT THE ANSWERS TO THE QUESTIONS, PROBLEMS AND CASE STUDIES PRIOR TO CLASS! An Interactive PowerPoint SOLUTION deck will be posted immediately following the Zoom session during which the Interactive PowerPoint was discussed.

There will be homework assignments for every module. Homework needs to be submitted prior to the class in which the homework will be discussed. The due dates for Homework are noted in the syllabus.  The homework will not be graded, but students will lose participation credit if homework is not submitted on a timely basis.  Solutions to all homework assignments will be posted to Brightspace immediately following the class session in which it was discussed.

PREREQUISITE: ACCT 561T or Acct 585

COURSE LEARNING OUTCOMES:

Upon successfully completing this course, the student will be able to:

1. Compute the income tax expense and draft the related income tax footnotes required by ASC 740 by preparing sample income tax provisions and footnotes including a comprehensive case study.  This will include annual and interim disclosures.

2. Determine the ASC 740 adjustments required to be recorded in connection with a business combination by analyzing common transactions and solving problems and case studies.

3. Explain the financial statement reporting of the income tax consequences of issuing stock-based compensation by analyzing footnotes of public companies and solving problems.

4. Estimate the amount of uncertain tax liability that should be recorded on the balance sheet of a company at year end by identifying the most common uncertain tax positions (UTPs) and then determining the appropriate approach for estimating the contingent income tax liability related to each UTP.

5. Analyze the need for a valuation allowance (VA) related to year end deferred tax assets by applying the VA framework of ASC 740 to common fact patterns often requiring a valuation allowance.

6. Apply the conceptual framework and guiding principles of ASC 740 to complex financial statement fact patterns including investments in international subsidiaries and joint ventures.

7. Read the income tax footnotes and other income tax disclosures of public companies and identify the critical issues which would be of relevance to an investor or other stakeholder by analyzing the historical Form 10K filings of public companies in various industries.

PROGRAM LEARNING OUTCOMES:

The following are the five Student Learning Outcomes developed for this program by the USC Leventhal faculty and administration and filed with the AACSB, the accrediting body for accounting and business schools.  This course will deal primarily with learning outcomes #1, #2 and #3, and to a lesser extent with learning outcomes #4 and #5.

1. Technical, Conceptual, Problem-Solving

Students will be competent in and be able to apply discipline-specific knowledge and skills in the fields of accounting or taxation.  This learning outcome includes the development of critical thinking and problem-solving skills, as well as an understanding of the strategic role of accounting and taxation in business organizations and society.

· MBT specific—Apply critical thinking and problem-solving skills related to taxation of individuals, flow-through entities, and corporations.  Recognize potential opportunities for tax savings and tax planning.

2. Professional Development

Students will be able to communicate clearly and strategically, after considering the relevant audience, situation, and purpose of the communication.  Students will demonstrate the ability to work productively with others to accomplish established goals.

· MBT specific—Convert complex and technical tax terminology into language that translates to non-technical audiences.  Demonstrate strong interpersonal communication skills that build relationships with clients over time.  Document exchanges with careful attention to word choice, tone, and accuracy.

3. Research/Life-Long Learning

Students will be able to use relevant research databases and academic/professional literature to gain new knowledge and analyze business situations.

· MBT specific—Use computer-based and paper-based systems to thoroughly research tax codes, tax law, rulings and interpretations.   Use knowledge to be able to adjust to changes in tax law over time.

4. Ethical Principles and Professional Standards

Students will be able to apply ethical principles and professional standards in analyzing situations and making informed decisions.

· MBT specific—Demonstrate understanding of and apply consistently the ethical principles and professional standards related to the profession.  Show the ability to express and follow rules of independence and the highest sense of professional ethics.

5. Globalization and Diversity

Students will be able to demonstrate an international perspective and appreciation for diversity and cultural differences, along with their significance in global business.

· MBT specific—Explain key differences in taxing policies related to expatriates and the countries they live and work in.  Reflect on cultural and ethnic differences in approaches to business and taxation policies.

GRADES:

Preparation and Participation on weekly Zoom calls 10%

Timely submission of weekly Homework Problems                                                  10%

Case Study                                                                        15%

Midterm Exam (Modules 1 – 7)                30%

Final Exam (cumulative; however, with a focus on Modules 8-14) 35%

Total                        100%

COURSE FORMAT:

All of the course materials can be found in Brightspace (https://brightspace.usc.edu). This course is divided into 14 modules; we will cover one module during each week of the course.  Module activities may include reading assignments, video recordings, interactive exercises, homework assignments, self-assessment problems, discussion forums, attending class sessions, and quizzes. It is expected that students will have completed all required activities and assignments before attending their class session each week.

Students should ensure that they can access all of the online tools via Brightspace prior to the start of classes.

OVERVIEW OF TOOLSETS:

Brightspace.  Brightspace is the primary learning management system currently used at USC. From the Brightspace Course Home Page, students can access their course syllabus, identify readings, participate in discussion forums, submit assignments, take quizzes and exams, and review grades at any time. They can also access links to the other platforms used in this course.

Zoom. Zoom is the platform used for all online sessions and online office hours. A link and instructions to join the Zoom sessions will be posted in the Bb Course Home Page under the “USC Pro Zoom” tab. For more information about Zoom, go to: Zoom Support Tutorials

COURSE POLICIES:

1. Your preparation and participation grade involves the timely completion (i.e. before each week’s Zoom online session) of the pre-recorded videos, self-assessment exercises and homework for the Module, as well as general participation in the Zoom online sessions.

a. Self-assessment exercises are graded for completion only – not for correctness. You can try these exercises as often as necessary to learn the material although only one attempt is necessary for full preparation credit.

b. Homework problems (posted in the Assignment folder in Brightspace) are for your practice and learning.  The submitted homework will not be graded.  However, these homework problems will be covered in our Zoom online sessions and must be submitted prior to our weekly Zoom online session. Each student will be expected to present the solution to at least one homework problem during the semester as part of your participation grade.  SOLUTIONS to all homework will be posted to Brightspace immediately following our weekly ZOOM session.

c. As previously noted, the questions, problems and case studies included in the Interactive PowerPoint deck should be reviewed by students prior to our weekly Zoom online session.  It is not necessary to answer or submit these discussion topics.  SOLUTIONS for the Interactive PowerPoint will be posted to Brightspace immediately following our weekly Zoom online session.

d. Attendance on the weekly Zoom online session is important in developing a coherent understanding of the materials covered in the course.  Attendance and active participation are expected at the synchronous Zoom online sessions.  For students who are in a time zone where the synchronous Zoom online sessions are outside the window of 8 am to 10 pm in your local time zone, please contact me before our first class on August 27, 2024.

2. A case study (AIM Inc.) will be assigned and graded.  Cooperation with other students is not allowed on this case study. The case study due date is included in this syllabus

3. A midterm and final exam will be given online and are both open book. Instructions will be posted on Brightspace.  The midterm date is indicated in the syllabus; the final exam date will be provided in November.  Exams will be timed but students will have a flexible window in which to take the exams. Make up examinations will generally not be given, except in the case of a well-documented emergency, and arranged for in advance with the instructor. Extra credit assignments will not be available.

4. Please feel free to contact me for individual office hours (via Zoom or phone call) if you have questions or need assistance with the material. I will generally reply to emails within 24 hours. Graded assessments (case studies and exams) will be returned with feedback prior to the due date of the next graded assessment.

GRADING POLICY

This course adheres to the USC Leventhal School of Accounting and Marshall School of Business grading standards for graduate programs. In general, final course grades at the graduate level in a core course average approximately B+ (3.3) but may vary based on class performance. For elective courses, the class average is usually higher (approximately 3.5), which is between a B+ and an A-. You must receive a C or better to pass a required class, and you must have an overall B average (3.0 minimum) from all your courses in order to graduate from USC. The graded elements of this course are listed in this syllabus along with information about how they will be evaluated.

OPEN EXPRESSION AND RESPECT FOR ALL

An important goal of the educational experience at USC Marshall is to be exposed to and discuss diverse, thought-provoking, and sometimes controversial ideas that challenge one’s beliefs.  In this course we will support the values articulated in the USC Marshall “Open Expression Statement”

STATEMENT ON ACADEMIC CONDUCT AND SUPPORT SYSTEMS

ACADEMIC INTEGRITY:

The University of Southern California is a learning community committed to developing successful scholars and researchers dedicated to the pursuit of knowledge and the dissemination of ideas.  Academic misconduct, which includes any act of dishonesty in the production or submission of academic work, compromises the integrity of the person who commits the act and can impugn the perceived integrity of the entire university community.  It stands in opposition to the university’s mission to research, educate, and contribute productively to our community and world.

All students are expected to submit assignments that represent their own original work, and that have been prepared specifically for the course or section for which they have been submitted.  You may not submit work written by others or “recycle” work prepared for other courses without obtaining written permission from the instructor(s).

Other violations of academic integrity include, but are not limited to, cheating, plagiarism, dishonesty, and any act that gains or is intended to gain an unfair academic advantage.

The impact of academic dishonesty is far-reaching and is considered a serious offense against the university.  All incidences of academic misconduct will be reported to the Office of Academic Integrity and could result in outcomes such as failure on the assignment, failure in the course, suspension, or even expulsion from the university.

For more information about academic integrity see the student handbook or the Office of Academic Integrity’s website, and university policies on Research and Scholarship Misconduct.

Please ask your instructor if you are unsure what constitutes unauthorized assistance on an exam or assignment, or what information requires citation and/or attribution.

IMPORTANT DATES – FALL SEMESTER 2024