Before you jump headfirst into the year-end financial reporting process, review the role independent audit committees play in providing investors and markets with high-quality, reliable financial information. Recent Securities and Exchange Commission (SEC) statement Under SEC regulations, all public companies must have an independent audit committee or...
You already may have reviewed a preliminary draft of your company’s year-end financial statements. But without a frame of reference, they do not mean much. That is why it is important to compare your company’s performance over time and against competitors. Conduct a well-rounded evaluation A comprehensive...
Some benefit plans are required to include an opinion from an independent qualified public accountant (IQPA) when filing Form 5500 each year. The IQPA examines the plan’s financial statements and schedules to ensure they are presented fairly and in conformity with Generally Accepted Accounting Principles....
When the Financial Accounting Standards Board (FASB) updated its rules for recognizing revenue from contracts in 2014, it only added to the confusion that non-profits already had about accounting for grants and similar contracts. Fortunately, last year, the FASB provided some much-needed clarification with Accounting Standards...
The Financial Accounting Standards Board (FASB) has not issued any major new accounting rules in 2019. But there have been some important developments to be aware of when preparing annual financial statements under U.S. Generally Accepted Accounting Principles (GAAP). Deferral of major accounting rules Accounting Standards Update...
The concept of ‘matching’ is one of the basic principles of accrual-basis accounting. It requires companies to match expenses (efforts) with revenues (accomplishments) whenever it is reasonable or practical to do so. This concept applies when companies make advance payments for expenses that will benefit...
Goodwill shows up on a company’s balance sheet when the company has been acquired in a business combination. It represents what is left over after the purchase price in a merger or acquisition is allocated to the company’s tangible assets, identifiable intangible assets, and liabilities....
Working capital is the difference between a company’s current assets and current liabilities. For a business to thrive, its working capital must be greater than zero. A positive balance enables the company to meet its short-term cash flow needs and grow. But too much working capital...
Change-in-control events — like M&A transactions — do not happen every day. If you are currently in the market to merge with or buy a business, you might not be aware of updated financial reporting guidance that took effect in November 2014. The changes provide...
Most businesses report financial performance using GAAP. But the income-tax-basis format can save time and money for some private companies. Here is information to help you choose the financial reporting framework that will work for your situation. The basics GAAP is the most common financial reporting standard...