What's new:
LIFO-PRO, Inc has released LIFO-PRO software Version 5
LIFO-PRO, Inc. released LIFO-PRO software Version 5 on 9/8/2010. This is a major version change that will require a full installation setup (and not just a version upgrade) in order to use this new version. Click here to learn more.
LIFO Repeal Update
New LIFO Repeal Updates are available. Click here to learn more.
PPI COMMODITY CODE STRUCTURE CHANGE- Addition of Services Table 6 Codes
There was a major change introduced into the organization of the PPI Table 6 codes by the Bureau of Labor Statistics (BLS) starting with the July 2009 PPI Detailed Report. Prior to that time, the Table 6 codes were organized using 15 different 2-digit codes (first two digits of all codes) representing 15 different commodity types. In July 2009, the BLS added numerous “Wherever-Provided Service” PPI Table 6 codes. These new service PPI Table 6 codes have 2-digit codes of 30 through 80. This is a link to pages 8 and 9 from the July 2009 PPI Detailed Report entitled “PPI Introduces Wherever-Provided Services and Construction Indexes” that describes the new organization of Table 6:
PPI Introduces Wherever-Provided Services and Construction Indexes
This is a link to a BLS publication entitled “New wherever provided services and construction indexes for PPI” which dated August 2009 that describes this change in more detail:
New wherever provided services and construction indexes for PPI
Click here for a detailed description of the changes.
LIFO implications of new IRS preparer penalty rule & FIN 48
The vast majority of LIFO calculation documentation we review reflects what we call “LIFO method deficiencies”. Fixing these LIFO problems has not been a big priority for companies and their CPAs in the past because, especially for smaller companies, the chance of IRS audit adjustments was not substantial. The LIFO IRS Regs. compliance standard has been drastically raised with these new rules.
We are encouraging our CPA firm clients to have us review the LIFO documentation for any clients for which we do not make the LIFO calculations or for which our LIFO-PRO software was not used so we can determine whether “LIFO method deficiencies” exist. There is usually no fee for this type of review.
LIFO-PRO website features:
LIFO calculator on LIFO-PRO website - This tool has been on our website since November 2007. A couple of auto dealer LIFO service providers have LIFO calculators on their websites but they only show a first year LIFO calculation and require users to provide registration information. Our web page shows the LIFO inventory balances for up to 5 years and requires no user entry of registration information. The URL for this page is: http://lifopro.com/LIFOWebCalculator.aspx
We think this will be a useful tool for CPAs to show the LIFO reserves that would result from projected FIFO inventory balances and inflation indexes.
The fact that our LIFO calculator shows LIFO reserve balances for several years helps to dispel a common LIFO misconception which is that increases in LIFO reserve balances require increases in FIFO inventory balances.
Other website pages - http://lifopro.com/GoodLIFOIndustries.html shows industries that are good LIFO candidates including historical PPI & CPI inflation rates.
