Achieving the right balance of working capital

Working capital — the funds your company has tied up in accounts receivable, accounts payable and inventory — is a critical performance metric. During times of rising inflation and interest rates, managers search for ways to free up cash and eliminate waste. However, determining the optimal amount of working capital can sometimes be challenging. Balancing […]

How to use QuickBooks as a fraud detection tool

Many businesses and nonprofits use QuickBooks® as a cost-effective solution to manage their accounting processes. However, the software’s capabilities extend beyond organizing and streamlining your company’s accounting. QuickBooks can also help you detect fraud. Here’s an overview of the software’s fraud detection and prevention features: Transaction audit trails QuickBooks creates audit trails that capture user […]

Reporting non-GAAP measures

Generally Accepted Accounting Principles (GAAP) is generally considered the gold standard in financial reporting in the United States. But private and public entities may sometimes use non-GAAP metrics in their disclosures and press releases or when applying for financing. GAAP vs. Non-GAAP GAAP is a set of rules and procedures that accountants typically follow to […]

Beware of the gray areas in accounting

Accounting and auditing standards have come under scrutiny in the wake of recent high-profile bank failures. Investigations are currently underway about what went wrong with Silicon Valley Bank and Signature Bank. But it’s likely that some “gray areas” in the accounting rules were exploited to make these organizations appear more economically secure in their year-end […]

Spring cleaning in QuickBooks

Have your company’s accounting records become cluttered with duplicate items and unused accounts? When you need to revise your QuickBooks® lists — such as the chart of accounts, customers and vendors — the software provides methods for deleting, inactivating and merging list entries. Here’s what you can do to help spruce things up. Deleting QuickBooks […]

New-and-improved accounting rules for common control leases

On March 27, 2023, the Financial Accounting Standards Board (FASB) published narrowly drawn amendments to the lease accounting rules. The updated guidance clarifies issues that are relevant to rental agreements between businesses that have the same owner. Written vs. verbal leases Accounting Standards Update (ASU) No. 2023-01, Leases (Topic 842) Common Control Arrangements, explains how […]

How to get more from your company’s income statement

What do you do with your financial statements after your CPA delivers them? If you’re like most business owners and managers, you breathe a sigh of relief that they’re finished, file them away and go back to running the business. But financial statements can be a useful tool to help improve business operations in the […]

Demystifying deferred taxes

Deferred taxes are a confusing topic — and the accounting rules for reporting these items often seem to defy the logic of real-world economics. Here’s a brief overview to help clarify matters. What are deferred taxes? Companies pay income tax on IRS-defined taxable income. On their Generally Accepted Accounting Principles (GAAP) financial statements, however, companies […]

Going green could save greenbacks and more

Nowadays many businesses are looking for creative ways to cut costs and preserve profits. As a bonus, some profit-enhancement initiatives can also be good for the environment. Here are some eco-friendly moves that may enable your business to cut costs — as well as build revenue and long-term value. Cost-cutting measures The most obvious way […]

Close-up on sources of substantive audit evidence

Organizations that understand how auditors verify account balances and transactions can minimize disruptions during audit fieldwork and maximize the effectiveness of financial statement audits. Here’s a summary of the types of “substantive evidence” auditors gather to help them form opinions regarding your financial statements. Original source documents Auditors can verify an account balance or record […]