Don't Cling to the Past

Don’t Cling to the Past

66 Weeks of Operation and 5,916,194 Page Views (without a penny spent on marketing)

Lesson 48

From: Joe


(1) – We had a fabulous week last week here at CPA Review for FREE. We’ve been in business for 66 weeks and last week we had our second busiest week of all time. In fact, I went back six months and checked our figures because I was curious about our growth. In just the last six months, the number of weekly visitors has increased by OVER 75 PERCENT. Now, if we can grow by another 75 percent in the next six months, we’ll be getting close to working with absolutely everyone—and that’s our real goal.
We want to help EVERY SINGLE PERSON WHO IS TAKING THE CPA EXAM.
Whether you have money or not, we want to help you pass the CPA Exam. Whether you have money or not, you deserve the opportunity of becoming a CPA.

Yes, I know that some of the bigger program (that really feel threatened by us) try to put us down by claiming “oh, people just look at that site out of curiosity – no one really uses it to pass the CPA Exam.” That’s absolute nonsense. Here’s a fact. Last week the average person stayed on our site for 27 minutes and 2 seconds for each visit. That’s just the average person. Can you imagine how many people stay on it for an hour or more at a time doing nothing but ADDING POINTS?! What’s more, the average person visited our site 2.4 times last week. Not once but 2.4 times.

Thanks for passing along the message to your family and friends. Keep up the good work.


(2) – Last call – if you want to receive a copy of the 20 questions in FAR to help you determine your strengths and weaknesses, send an email to jhoyle@cpareviewforfree.com.


(3) – Couple of neat emails. I love to hear about the thrill of victory. I want each person who gets these email lessons to come to feel this same excitement.

FROM EB: “I was pleased to learn last Friday that I passed the Audit section with a score of 85. I attribute a lot of the success to your website – both the practice questions and the encouragement. I wrote earlier and told you that I’ve been taking accounting classes since 1999 and my goal is to pass the CPA exam during the year that I’m 55. Looks like I might be on track, thanks to your help.”

FROM AB: “I have some great news to share with you. I passed 3 parts of the CPA exam in the July/August window. I sat for my final part (BEC) this past Thursday so I am still waiting for that score. I am happy the exam is almost behind me. I used the self-study program which my employer pays for. However, I also made extensive use of CPA Review for Free. I found your website to be a helpful study tool. In fact, I specifically remember seeing questions on BEC that I would not have known the answer to had I not used your site. I found working your multiple choice questions to be more productive than watching a DVD lecture from that other big program.”

FROM DB: “Just wanted to let you know that I passed my second CPA exam, Audit, with a score of 95. I know you always say to get as close to 75 as possible, but it does feel good to have such a high score. Once again your website proved to be a valuable study tool. So thank you for that. I've continued to use it in my studies for my next exam, FAR, which I'm taking on the 17th. I'll be sure to let you know how that goes.”

I’m delighted to get emails from these people but I really want to get an email from YOU. I want to hear YOU talk about the excitement of getting that 75. I want to hear about how hard YOU worked but how great YOU feel to know YOU have passed. I want to hear the thrill in YOUR (email) voice. Yeah – YOU.


(4) – We have a new batch of Auditing study notes now on our site. And, as always, they are free. We have had a lot of people tell us that these are very helpful.

To find them, go to www.CPAreviewforFREE.com.
Click on Resources at the top of the page.
Click on More Articles and you will be there.


(5) – If you need to unsubscribe, just scroll to the bottom of this email lesson and click on the proper button.

If you know anyone who is thinking of taking the CPA Exam or anyone in college who is studying accounting, we would love for you to forward this lesson to them and suggest that they look into www.CPAreviewforFREE.com. If it helps you, pass along the message.


(6) – I am not a person who saves things. Oh, I have a few shirts that my wife thinks I should throw away but, for the most part, I don’t keep things very long. However, here’s the big exception to my rule.

When I was about 15 years old (probably 1963), I read a magazine article that included someone’s list of 10 things that would serve as Rules for a Successful Life. I was very young and I was intrigued by the idea of Rules for a Successful Life. I cut these rules out of the magazine and taped them to my sophomore notebook. At the end of the year, I peeled them off and taped them to my junior year notebook. I continued to read these occasionally and think about them throughout high school and then college. After college, I kept the rules with me and, again, read them now and then. And, thought about them—really thought about them.

Now, 46 years later, they are taped to the side of my file cabinet at my office at school. They are really worn and tattered but I still read them occasionally and think about them.

Today, the one that caught my attention was rule Number Eight: “Don’t cling to the past.” I think living in the past, holding on to what has already gone, is one way to keep you from succeeding at the current time.

If you have had success in the past, that is great. Good for you. Time to forget about that and have success today! I have taught now for almost 39 years and have won a number of teaching awards. That didn’t do any of my current students one bit of good when I class today. They needed for me to be as good as possible today. I couldn’t just go in and say “let me tell you well I taught back in the good old days of 1983 or 2003.” I needed to be good today. That is my goal; I need to be good every day regardless of the past.

If you have had failure in the past, I am genuinely sorry – but it is time to get over it. I know people who cling to their past failures like they are dear teddy bears that need to be clutched tightly. Failure yesterday is not failure today UNLESS YOU LET IT BE. As far as I know, there is no reason to relive a single failure from your past. Once you figure out what you might have done differently, don’t bring it back up. Don’t be haunted by past failures. No one cares and neither should you.

I know many of you have failed a part of the CPA exam or didn’t do well in some classes at school or have struggled at your jobs at one time or another. That’s in the past. It’s like Abraham Lincoln and George Washington, it is just part of the ancient past.

Your only goal when you have a failure is to sit back and go: “okay, how can I do better? What changes do I need to make? I obviously need to adjust my strategy—what should I do today that will get me a better outcome?”

You are a smart person – for the smart person, failure is just a helpful step to success. Okay, you are allowed to take one take to cry and fuss and throw things. That’s reasonable. After that one day, it should all be about changing, getting better, getting different results.

Always succeeding at everything is probably fun but it is not great fun. The greatest fun is failing and taking up the challenge and then passing. Because then you know for sure that you did it. It wasn’t luck; it wasn’t your education; it was YOU. You failed and then you fought back and you were successful.

Life is tough. Life can just beat you up. You can hide like a whipped puppy or you can fight back.

Failure should be like a trampoline that helps you spring up much higher than you can possibly jump by yourself.

Don’t cling to the past.
Get to work to change the future.
What do you want in your future? If you want to pass the CPA Exam, if that is a real goal and not just an illusion, create your plans right now for the next week, the next month, and the next six months. How are you going to make it happen? You need plans. What are you going to accomplish in the next week, in the next month, and in the next six months to turn those failures into wonderful success stories?


(7) – Very quick story that I’ve told before but I am reminded of it by the story above. One of my heroes, Vince Lombardi, was one of the all-time great football coaches. Early in his coaching career, his Green Bay team lost a playoff game that they could easily have won at the very end but didn’t. As he walked off the field, Coach Lombardi asserted “my team will never lose another playoff game.” And, they didn’t. For the rest of his career, they never lost another playoff game. They lost games but, in the playoffs, when it really counted, his teams never lost again.

Coach Lombardi didn’t dwell on the failure. He used the failure to push him to incredible success.

(8) – PRACTICE

FAR

Big Company buys Small Company and is now consolidating the financial statements as of the date of the acquisition. Each of the following four items has a fair value. Which of these is most likely to not be recognized on the consolidated balance sheet as an intangible asset at fair value as of the date of the acquisition?

A – Noncompetition agreement with a former employee
B – Unpatented technology
C – An employee who recently won the Nobel Prize for Chemistry
D – Secret formula for Small Company’s most popular product.

Answer is C

In an acquisition, every intangible should be identified if it has fair value (and all of these are said to have fair value). For recognition to be required, the parent must either gain contractual rights to the asset (such as the noncompetition agreement) or be able to separate the intangible from the subsidiary and be able to sell it (such as the unpatented technology and the secret formula). The company does not have legal rights to the employee and that person cannot be separated from the subsidiary and sold. Thus, the employee cannot be reported as an intangible asset, regardless of the value to the organization. However, if the company has an employment contract with the person, that does provide a contractual right and that contract (not the person but the contract) would be an intangible asset. No employment contract is mentioned in this problem.


Auditing and Attestation

In an audit engagement, the independent auditor should get a management representation letter as part of the normal audit procedures. Which of the following is not true?

A – The letter must be signed by the chair of the board of directors
B – The letter should be dated no earlier than the date of the auditor’s report
C – The letter should indicate that all significant estimates known to management have been properly disclosed.
D – If the management is not willing to issue this letter, the independent auditor ordinarily gives a disclaimer of opinion.

Answer is A

The management representation letter should be signed by the chief executive officer and the chief financial officer because they are the leaders of the management. It is normally signed on the last day of audit fieldwork (the audit report date) but can be signed later if management is not available on that date. However, it cannot be signed any earlier than that date. Among other things, it indicates the completeness of the financial records and underlying transactions. It also indicates that all items such as significant estimates, plans, guarantees, violations, and the like have been properly disclosed to the auditors. Because of its importance, the independent auditor cannot give an unqualified opinion without getting a signed representation letter and ordinarily gives a disclaimer.


BEC

What is a scattergraph?

A – A method for forecasting product demand on an X/Y axis.
B – A graph to help compute the relationship between two variables.
C – A chart designed to pinpoint unexpected changes as a result of variable costing.
D – A graphed picture created to pick up negative trends in sales figures over time.

Answer is B

Companies, especially manufacturing companies, often try to determine the relationship between two variables. For example, what is the relationship between the unemployment rate and company sales? How does a rise in temperature impact the number of units produced by a particular plant? Over time, the two variables can be plotted on a graph. When enough observations have been made, a straight-line is drawn through those points and used to indicate the perceived relationship of the variables. It is a method that lacks precision but can help management get a feel for the relationship.


Regulation

A bilateral contract is one in which

A - A promise is given in exchange for a promise
B - Both parties have fully performed
C - Either party may terminate the contract without recourse
D - A negotiable instrument is given in lieu of payment

Answer is A

A bilateral contract is one in which a promise is given in exchange for a promise. This is the most common type of contract. One party, for example, promises to deliver, in the future, goods or services; the other party promises future payment. Both parties are bound. A unilateral contract is one in which one party has already performed. For example, you purchase a motor boat, taking immediate delivery and promise payment in 60 days. The seller has already performed the action by handing over the boat; you have made the only promise—the promise to pay.


Have a great week – work hard and, for goodness sake, DON’T CLING TO THE PAST!!!


Joe Hoyle
www.youtube.com/watch?v=LjwHxVbZq1o

Co-Founder
CPA Review for FREE

www.CPAreviewforFREE.com