Technology is altering the traditional approach to internal audits. Instead of reviewing reams of paperwork, today’s auditor is learning to use electronic records. In turn, going paperless facilitates a concept known as ‘continuous auditing,’ where internal auditors continually gather data to support their procedures. Here...
Business assets are generally reported at the lower of cost or market value. Under this accounting principle, certain assets are reported at fair value, such as asset retirement obligations and derivatives. Fair value also comes into play in mergers and acquisitions transactions. That is, if one...
Audited financial statements come with a special bonus: a ‘management letter’ that recommends ways to improve your business. That is free advice from financial pros who have seen hundreds of businesses at their best (and worst) and who know which strategies work (and which do...
More than half of recent college graduates plan to start a business someday, according to the results of a survey published in August by the American Institute of CPAs (AICPA). Unfortunately, the AICPA estimates that only half of new businesses survive the five-year mark, and...
Has your organization received any public or private grants to fund its growth? Grants sometimes require an independent audit by a qualified accounting firm. Here is what grant recipients should know to help facilitate matters and ensure compliance at all levels. Federal compliance Federal awards require compliance...
What is the purpose of a corporation? For the last 50 years, the answer was “to maximize shareholder value.” But, on August 19, CEOs of 181 leading U.S. businesses, including Amazon, Apple, General Motors, and Walmart, pledged to broaden the scope. Beyond shareholder value Putting shareholders first...
The average company’s balance sheet understates its value by 80 percent, according to Sarah Tomolonius, co-founder of the Sustainability Investment Leadership Council. Why? Intangible assets are not recorded on the balance sheet under U.S. Generally Accepted Accounting Principles (GAAP), unless they are acquired from a...
It is important for franchisors to periodically audit individual franchisees. These routine ‘check-ups’ are especially valuable in a store’s early years of operations or if performance starts to deteriorate. They can be used to detect symptoms of unhealthy performance and treat problems before they spiral...
Financial reporting generally focuses on the results of continuing operations. But sometimes businesses sell (or retire) a product line, asset group, or another component. In certain situations, such a disposal should be reported as a discontinued operation under U.S. Generally Accepted Accounting Principles (GAAP). Starting...
In July, the Public Company Accounting Oversight Board (PCAOB) published two guides to help clarify a new rule that requires auditors of public companies to disclose CAMs in their audit reports. The rule represents a major change to the brief pass-fail auditor reports that have...