Management naturally wants to portray the rosiest picture of a company’s financial performance that they can. This overzealous earnings management (aka “spin”) could easily mislead lenders and investors. Look at these practices below, where U.S. Generally Accepted Accounting Principles (GAAP) could potentially be manipulated to obscure the truth.
During an audit, income statement items warrant close attention due to their complexity, possible effect on balance sheet items and the potential for manipulation. Auditors tend to focus on particular income statement categories as outlined below. Revenue Revenue recognition can … Continued
As part of year-end planning, business managers and auditors often assess a company’s unique risk factors. A “SWOT” analysis is a great tool to facilitate a detailed review of the organization’s strengths, weaknesses, opportunities and threats. By taking an honest … Continued
A financial statement audit can be a daunting process, especially for companies that have never had one and are unsure what to expect. Despite the anxiety that the word “audit” may incite, it’s important to understand the benefits an independent … Continued
When you need cash now, but it takes weeks – or even months – to collect on outstanding invoices from customers, it’s important to know your options for converting outstanding receivables into ready cash. Line of credit A line of … Continued
Whether your business is an LLC, S-Corp, C-Corp or other entity, filing a tax return each year is most likely a necessity. But there are often differences in how different private companies issue their financial statements. Some choose to issue … Continued