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Resources for CPA Firms



Why CPA’s Partner With LIFO-PRO


CPA firms often struggle to bridge the gap to provide both prospective and current clientele LIFO calculation services. Aside from the big four, most CPA firms do not staff accountants that are dedicated to completing LIFO calculations. Furthermore, CPA firms typically haven’t developed automated LIFO software and/or use a set of standardized best LIFO practices procedures for providing LIFO Calculation Services. CPA firms often utilize time-intensive and costly methods to provide their clientele LIFO calculation services. This results in decreased profitability for CPA firms and increased service costs for clientele.

LIFO-PRO partners with over 60 CPA firms to provide LIFO calculation services and LIFO software. LIFO-PRO does not compete with CPA firms since LIFO is our sole practice. We serve CPAs and their clients in all industries including retail, manufacturing, wholesale and food processing. LIFO-PRO’s goal is to provide CPA’s and their clientele comprehensive, consistent & easy to understand LIFO reports that represent great value of terms of features, ease of use & support.


LIFO-PRO Services & Software Offerings for CPA Firm Clientele


  • Completing annual LIFO calculations (for all LIFO methods)
  • LIFO-PRO Reports with comprehensive documentation of LIFO calculation
  • Assignment of BLS CPI/PPI categories to clientele’s inventories (CPI/PPI coding)
  • LIFO-PRO software licenses for CPA firms preferring to perform/provide LIFO calculations themselves
  • IRS Forms 970 and 3115 preparation
  • LIFO projections (no cost)
  • Pro Forma LIFO Reports for potential LIFO candidates (no cost)
  • Best LIFO Practices Methods Reviews (no cost)

Opportunities Provided by LIFO-PRO to CPA Firms


  • Increase profitability, efficiency & client retention by offering LIFO calculation services at the lowest cost
  • High-quality LIFO reports that are comprehensive, consistent & easy to understand
  • Sec. 263A UNICAP Costs calculated & integrated into LIFO Reports
  • No-cost pro-forma LIFO calculations for clients that are potential LIFO candidates
  • Maximize clientele’s LIFO tax benefits
  • Use LIFO-PRO software to offer standardized LIFO reports to their clientele
  • Quick turnaround time
  • Free LIFO projections

LIFO-PRO’s Engagements With CPA Firms & Their Clientele


CPA firms often provide companies a customized set of services that are tailored to meet their clientele’s expectations. LIFO-PRO understands that most companies require a unique set of offerings provided to them; LIFO-PRO closely collaborates with CPA firms to deliver their clientele the exact same level of services that they expect to receive. LIFO-PRO offers flexible service engagement arrangements to provide the highest amount of value for CPA firms & their clientele. These arrangements include:

  • Working exclusively with CPA firm to receive & deliver year end LIFO data/files/reports
  • Arranging billing & payment procedures to be handled exclusively by CPA firm
  • Working directly with the client to handle all LIFO calculation services/billing

LIFO-PRO provides CPA firms the option to subcontract this work to us entirely or work collectively with the CPA/client in order to become more self-sufficient in working with LIFO. Learn more about LIFO-PRO’s service offerings & engagements by clicking below:

LIFO Service Engagements Overview

Cost Leadership


LIFO-PRO utilizes the automated LIFO calculation & reporting features of our in-house developed LIFO-PRO software to provide a full range of high-quality LIFO calculation services to CPA firms & their clientele at the most affordable costs. LIFO-PRO’s 25+ years of expertise of dealing exclusively in LIFO allows us to partner with CPA firms to provide a customized level of services that fits the unique needs of all clientele. LIFO calculation services and LIFO-PRO software licenses for CPA firms start as low as $500.

CPA LIFO Services Cost Estimate
CPA LIFO-PRO Software License Cost Estimate

Pro Forma LIFO Reports


The reports shown below are complimentary resources provided by LIFO-PRO to CPA firms for current & prospective clientele


Pro Forma LIFO Inflation & Expense Calculation Report



The Pro Forma LIFO Inflation & Expense Calculation Report is designed for current or prospective CPA Firm clientele that are considering making a LIFO election. LIFO-PRO assigns the appropriate BLS categories to companies inventory items to calculate twenty years of historical inflation averages. Also seen above is the projected LIFO expense that would result from the 5.6% 12/31/2016 year end inflation index and 2015/2016 year end inventory balances.

The example shown above would be a situation where LIFO-PRO would strongly recommend a 2016 LIFO election for the CPA firm’s client. LIFO-PRO would include the following factors in justifying such a recommendation:
1) There is inflation in 15 of the 20 years for the BLS PPI index categories used for this company’s inventory mix
2) The current year and 3/5/10/20 year inflation averages are all inflationary
3) There is a material 12/31/2016 Tax LIFO deferral benefit that merits making a LIFO election for the current period


IPIC LIFO Historical Inflation Report



The IPIC LIFO Historical Inflation Report shows inflation percentages for the IPIC BLS PPI Table 9 categories applicable to the CPA firms client’s inventory mix. This report is useful for CPA firms because it serves as an accurate gauge of the potential LIFO tax deferral benefit that their client could capture from making a LIFO election.

Shown above are five most predominantly-used BLS PPI categories and their respective inflation percentages for the current year end and along with 3/5/10/20 year averages. LIFO-PRO identifies the most predominant inventory items present in a company’s product mix and selects the appropriate BLS PPI Table 9 categories to provide CPA firms the historical inflation averages for their client.

The example shown above would be a situation where LIFO-PRO would strongly recommend a 2016 LIFO election for the CPA firm’s client. LIFO-PRO would include the following factors in justifying such a recommendation:

1) There is inflation in all five of the BLS PPI Table 9 categories shown above for the current year end
2) There is likely to be at least 1-2% average inflation if a LIFO election were to be made by the CPA firm’s client this year since the five BLS PPI categories likely represent a large majority of the company’s inventory mix
3) 22 out of the 25 inflation averages are inflationary for the BLS PPI category periods shown above


LIFO Inflation & Expense Comparison Report



The LIFO Inflation & Expense Comparison Report serves as a pro forma comparison of the additional Tax LIFO deferral benefit that could be achieved from a CPA firm’s client switching LIFO inflation measurement sources. LIFO-PRO often finds that changing a company’s LIFO inflation measurement source from an internally-calculated index to the IPIC Method (using BLS Consumer Price Index or Producer Price Index; known as “CPI” or “PPI”) produces materially higher Tax LIFO deferral benefits. Since The IPIC Method is an IRS safe harbor method, companies also receive IRS audit protection for any LIFO calculation error(s) made in periods prior to their IPIC LIFO Method election (switching to the IPIC Method is an automatic change made via filing a form 3115 Application for Change in Accounting Method).


LIFO Inflation, Expense & Reserve Comparison Report



The LIFO Inflation, Expense & Reserve Comparison Report is for CPA firm clientele that are currently on LIFO, but are considering making a switch from an internally-calculated LIFO inflation measurement source to the IPIC method (externally calculated inflation measurement; i.e. BLS CPI/PPI). It compares the LIFO inflation, Expense and Reserve for the current & two prior periods between Sample Corporation’s actual internally-calculated LIFO inflation and the pro forma IPIC BLS PPI inflation measurement sources. This report provides the adequate data required for CPA firms and their clientele to calculate the retrospective effects of a LIFO accounting method change.
In the example shown above, LIFO-PRO would strongly recommend that the CPA firm’s client switch their LIFO inflation measurement source from the internally-calculated inflation measurement source to the IPIC method. LIFO-PRO would include the following factors in justifying such a recommendation:
1) The average IPIC PPI inflation is more than 3% higher than the internally-calculated inflation over a three-year period
2) The $2,711,814 of additional Tax LIFO deferral represents a materially different 12/31/2016 LIFO Reserve balance when comparing the IPIC PPI LIFO inflation to the actual internally-calculated LIFO inflation measurement source
3) Sample Corporation could achieve $1,564,708 in additional Tax LIFO deferral (LIFO reserve increase) for the12/31/2016 year end if they were to elect the IPIC method in 2016 when compared to the internally-calculated inflation index that they currently use, and would avoid recognizing $1,129,014 of LIFO income (LIFO reserve increase)


LIFO Historical Inflation Comparison Report



The LIFO Historical Inflation Comparison Report uses BLS PPI Table 9 category inflation percentages that would be assigned to a company’s product categories to compare their inflation percentages against the internally-calculated inflation percentages. The example shown above would be a situation where LIFO-PRO would strongly recommend the CPA firm’s client making a change in accounting method to switch their inflation measurement source from internally-calculated indexes to the IPIC Method (PPI).LIFO-PRO would include the following factors in justifying such a recommendation:

1) The IPIC BLS PPI current year inflation is more than 2.5% higher than Sample Corporation’s internally-calculated inflation
2) 23 of the 25 inflation averages are inflationary for the BLS PPI category periods shown above
3) The BLS PPI inflation is projected to yield a material Tax LIFO deferral benefit (LIFO Expense; LIFO reserve increase) whereas Sample Corporation’s actual internally-calculated inflation index is projected to yield a Tax LIFO liability (LIFO income; LIFO reserve decreases)


IPIC LIFO BLS Appropriate Month Comparison Report



The IPIC LIFO BLS Appropriate Month Inflation & LIFO Expense Comparison Report compares the inflation & LIFO Expense amounts that would result from each of the appropriate month periods allowed by IRS Regs.
This comparison report is used for CPA firm clientele that are making an IPIC LIFO Method election for the first time, or for clients that already use the LIFO method and are switching to the IPIC method.


IPIC LIFO BLS Category Method Comparison Report



The IPIC LIFO BLS Category Assignment Method Inflation & LIFO Expense Comparison Report compares the inflation & LIFO Expense amounts that would result from assignment of most-detailed BLS categories (known as the most-detailed category method) or less-detailed BLS categories (known as the 10 percent method) along with each of the appropriate month periods allowed by IRS Regs.
This comparison report is used for CPA firm clientele that are making an IPIC LIFO Method election for the first time, or for clients that already use the LIFO method and are switching to the IPIC method.


Additional LIFO Resources for CPA Firms


iconLIFO Resources for CPA Firms
LIFO Reports