Administration.

Tax Planning for Clergy, Gary Hayes and Debra McGilsky, Central Michigan University, School of Accounting, Mt. Pleasant, MI 48859

Clergy represent one of the few professions subject to tax laws unique just to them. As a result, anyone who serves on a religious board or finance committee, or who serves as treasurer for a religious organization, needs to be aware of the tax compliance complexities and planning opportunities clergy face. This paper addresses one of the most challenging of these complexities, the clergy's housing allowance. This provision allows a sizable portion of compensation to be exempt from tax, however, calculating it can be confusing. The paper discusses the optimal way a clergy's compensation package should be allocated between his/her regular salary and his/her housing allowance so that the amount of income and self-employment taxes is minimized. It addresses clergy who live in organization-provided homes, as well as clergy who live in their own home, and clarifies the specific items that may be included in their allowable housing expenses, an amount used to determine the taxable portion of the allowance. It also identifies the required accounting and record-keeping rules needed to substantiate the allowance, including resolutions boards must make to ensure optimal tax results. A case study is provided to illustrate the mechanics of the calculation.

Tax Consequences of Selling a Principal Residence. William C. Hood, Central Michigan University, School of Accounting, Mt. Pleasant, MI 48859

When a taxpayer sells his or her principal residence, there are numerous tax advantages. However, as is almost always the case, the Internal Revenue Code has strict requirements that must he met if the taxpayer is to attain these tax benefits. This paper will explain these requirements and will suggest planning techniques that taxpayers should follow to assure they will qualify' for all of the tax benefits that are allowed to those who sell their principal residence.

The Administrative Case for Sustainability as a Business Strategy, jack D. Cichy, Davenport University, Donald W. Maine, School of Business Management Department, Grand Rapids, MI 49512

Sustainability or SBP practices can he defined in numerous ways. Some administrators view Sustainability as creating social and shareholder value while simultaneously decreasing negative environmental impact. Others view Sustainability as 'taking care of people first'. The Procter and Gamble Corporation provides meaning to the concept of Sustainability in a simple and succinct context: "It is about ensuring a better quality of life for everyone, now and for future generations to come." Sustainability and SBP focus on financial capital, ecological (environmental) capital and social capital, or the triple bottom line. As such, SBP or the Sustainability movement is a component of the broader business movement toward greater administrative social responsibility.

This Power Point session offers an overview of the multi-disciplinary concept of Sustainability with a focus on the environmental, social and economic dimensions of Sustainability and Sustainable Business Practices. The Sustainable Business Approach to capitalism is examined with a focus on the Benefits of a "triple bottom line" that integrates financial profitability, environmental integrity, and social equity.

Audit Committees--Living Up to Changing Expectations. Marilyn Kintzele, Indiana University Kokomo, Accounting Department, Kokomo, IN 46904; and Philip Kintzele and Vernon Kwiatkowski, Central Michigan University, School of Accountancy, Mr. Pleasant, MI 48859

Although corporations have been required by the stock exchanges to have audit committees for many years, the various regulatory authorities have refined the requirements for audit committees in recent years. This paper will review the development of these requirements for audit committees. Because of the problems with corporate financial reporting over the last several years, there have been expanded expectations of audit committee performance. An examination of the audit committee reports in corporate proxy statements is contained in this paper.

A Look at Differences in Governmental Audits Related to the Type of Auditor. Stephen T. Jakubowski, Ferris State University, Department of Accounting, Finance and Information Systems, Big Rapids, MI 49307

With the recent Enron bankruptcy, the quality of the work of independent CPAs has again come into question. Events such as this have increased the financial reporting requirements for independent auditors in both the private and public sectors. Auditors are required by the Single Audit Act of 1984 (SAA), to report not only on a government's financial statements, but also on its compliance with applicable laws and regulations and internal controls. The auditor's reports typically become a part of the government's annual financial report. The objective of this study is to provide information about how independent auditors have responded to the SAA. One would expect that the quality of an audit is constant across all auditors. There has been some concern expressed about the quality of single audits, particularly those of independent CPAs (GAO; 1986, 19S9). In this research, the audit reports of independent CPA firm, arc compared to those of audits conducted by the Michigan Office of Auditor General for a sample of counties to determine if there is a difference in the frequency and type of reported findings. The results of this research have important implications related to the usefulness of audit reports and single audit quality.