Business owners generally prefer to work with entities they know and trust. But related-party transactions can provide opportunities for individuals to act in a manner that’s inconsistent…Read More
Archive for the ‘Audit’ Category
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Profits: How low can you go?
If your profits are falling compared to revenue and assets, your financial statements may provide insight into what’s happening and how to improve your performance. Watch for…Read More
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Effectively communicating with the audit committee
CFOs and other executives occasionally present information about the company’s operations, strategies and risks to the audit committee. Your presentation will generally be most effective if you…Read More
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Public vs. private companies: When should different accounting rules apply?
Small private companies often criticize the Financial Accounting Standards Board (FASB) for writing overly complex standards that focus on the needs of stakeholders in large public companies…Read More
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Internal control testing: What role does sampling play?
Auditors must test the effectiveness of internal controls before signing off on your financial statements. But it’s impossible to analyze every transaction that’s posted to the general…Read More
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Learn the warning signs of earnings “spin”
Management wants to paint the rosiest possible picture of a company’s financial performance. But aggressive earnings management, or “spin,” can mislead investors and lenders. Here are some…Read More
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Corporate culture: Rotten apples could spoil your financials
Auditors often say that the tone at the top of an organization trickles down to every level of the business. Is your company’s work environment ethical and…Read More
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How materiality is established in an audit or a review
When accountants conduct an audit or review, they can’t test every transaction. Instead, they set a “materiality” threshold. This benchmark is used to obtain reasonable assurance in…Read More
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Feeling lucky? How to find a pot of gold in your financials
Every business experiences occasional cash shortages. When this happens, owners often assume they should go out and sell more. But this strategy can sometimes compound money troubles…Read More
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What is job cost reporting?
Custom jobs require ongoing supervision to achieve the best financial results. Whether you’re a general contractor constructing a strip mall, a manufacturer building made-to-order parts or an…Read More