audit

Goodwill impairment is often a negative indicator. It potentially signals that a business combination failed to meet management’s expectations due to internal or external factors. In recent years, uncertain markets, lingering inflation and high interest rates have caused goodwill impairments […]

Financial statements help managers, lenders and investors evaluate a company’s financial performance. But they tell only part of the story — and they might not reveal financial distress until it’s too late, especially for companies that issue only annual reports. […]

A chart of accounts is the foundation of accurate financial reporting, so it needs to be set up correctly. A disorganized chart or one that lumps transactions into broad, undefined “buckets” of data can make it difficult for management to […]

It’s critical for business owners and managers to understand how to present contingent liabilities accurately in the financial statements. Under U.S. Generally Accepted Accounting Principles (GAAP), some contingent losses may be reported on the balance sheet and income statement, while […]

Running a closely held business is challenging. Owners usually prioritize core business operations — such as managing employees, serving customers and bringing in new sales — over tedious bookkeeping tasks. Plus, the accounting rules can be overwhelming. However, access to […]

In recent years, the accounting rules have undergone significant changes, including updated standards for reporting revenue, leases and credit losses. While business owners and managers often express frustration over the complexity of these rules, they’re more than an exercise in […]

As calendar-year entities wrap up financial reporting for the year, their external auditors work behind the scenes to prepare for audit season. Here’s what you can do to help facilitate the audit planning process. The audit risk assessment During fieldwork, […]

When reviewing their income statements, business owners tend to focus on profits (or losses). But focusing solely on the bottom line can lead to mismanagement and missed opportunities. Instead, you should analyze this financial report from top to bottom for […]

The pretax (accounting) profit that’s reported on your company’s income statement is an important metric. Lenders, investors and other stakeholders rely on pretax profits to evaluate a company’s financial performance. However, business owners also need to keep their eyes on […]

Audit season is just around the corner for calendar-year entities. Understanding the types of source documents your audit team might request can minimize disruptions during audit fieldwork and maximize your audit’s effectiveness. Here are some common sources of “substantive evidence” […]

Profitable businesses often experience cash flow shortages, particularly if they’re experiencing rapid growth. Business owners may wonder why they owe taxes when they regularly struggle to find cash to cover their bills. The answer can be found by understanding the […]

Public companies are required to evaluate and report on internal controls over financial reporting using a recognized control framework under rules set forth by the Securities and Exchange Commission (SEC). However, private companies also need checks and balances to help […]