Accounting & Audit

Using agreed-upon procedures to target specific items of concern

Your CPA offers a wide menu of services. One flexible offering, known as an “agreed-upon procedures” engagement, provides limited assurance on a specific aspect of an organization’s financial or nonfinancial information. What’s covered? Agreed-upon procedures can cover various items. For example, a CPA could provide a statement about the reliability of a company’s accounts receivable,…

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Why auditors prefer in-person interviews to assess fraud risks

Auditing standards require financial statement auditors to identify and assess the risks of material misstatement due to fraud — and to determine overall and specific responses to those risks. Here’s why face-to-face meetings are essential when assessing these risks. Audit inquiries Fraud-related questions are a critical part of the audit process. The AICPA requires auditors…

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Are your risk-management practices keeping up with the times?

Risks abound in today’s uncertain marketplace. Nearly two-thirds of senior finance leaders said that the volume and complexity of corporate risks have changed “mostly” or “extensively” in the past five years, according to a new report published by the American Institute of Certified Public Accountants (AICPA) and North Carolina State University. Surprisingly, this report, 2022…

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Evaluating “going concern” concerns 

Under U.S. Generally Accepted Accounting Principles (GAAP), financial statements are normally prepared based on the assumption that the company will continue normal business operations into the future. When liquidation is imminent, the liquidation basis of accounting may be used instead. It’s up to the company’s management to decide whether there’s a so-called “going concern” issue and…

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Remote auditing: A brave new world

The pandemic has presented numerous challenges for businesses, but it also taught us how to be resilient, cost-conscious and adaptable. Over the last few years, we’ve learned that remote working arrangements offer many benefits, including reducing the time and cost of performing many tasks. Here’s how these lessons translate to the work auditors do to…

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Prepare for Project Delays With Savvy Financial Strategies

Although construction activity tends to ramp up nationwide over the summer, that doesn’t mean everything goes as planned. A project that looks sunny on paper can turn into a hot mess if it experiences serious delays. Make sure you’re prepared. The usual suspects As you’ve likely experienced, various unforeseen events can bring a job to…

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The New Lease Accounting Standard is Here (For Real This Time)

Does your construction business follow Generally Accepted Accounting Principles (GAAP)? And does it lease equipment, real estate or other assets? If you answered “yes” to both questions, your company should be implementing the new GAAP lease accounting standard now. The new standard, which will be reflected in your 2022 year-end financial statements, could have a…

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Last call for lease accounting 

The updated lease accounting standard is currently in effect for private companies. After several postponements during the pandemic, the Financial Accounting Standards Board (FASB) voted unanimously to move forward with the changes. That means private companies and private not-for-profit entities that follow U.S. Generally Accepted Accounting Principles (GAAP) must adopt the new standard for fiscal…

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Ready for the New Gifts-In-Kind Reporting Requirements?

The Financial Accounting Standards Board (FASB) has new rules for how nonprofits that follow Generally Accepted Accounting Principles (GAAP) must report and value “nonfinancial assistance” — commonly known as gifts in kind. The changes are effective for annual periods beginning after June 15, 2021, and interim periods within annual periods beginning after June 15, 2022.…

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Dig deeper! Find hidden treasure in financial statement footnotes

Numbers tell only part of the story. Comprehensive footnote disclosures, which are found at the end of reviewed and audited financial statements, provide valuable insight into a company’s operations. Unfortunately, most people don’t take the time to read footnotes in full, causing them to overlook key details. Here are some examples of hidden risk factors…

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