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Accounting Agency Conway

What is Farm Accounting?

Farm businesses need the services of an agricultural accountant. In many instances, farm businesses are large corporations. Farm accountants provide an essential service for farmers, helping them anticipate expenses, track expenditures, and ascertain ventures that will be most profitable – such as planting more corn, wheat or soybeans and letting field lie fallow.

Reporting and tracking farm expenses pose some interesting challenges. Cash basis accounting is one type of method to report income and costs and can be used to report taxable farm income. Farm accounting is utilized to record all goods, money and services used in the farming industry.

A farm accountant will deal with a variety of aspects relating to their client, from cash flow, day-to-day expenses, government subsidies when applicable, and even estate planning. Farm accountants provide a wide range of information to their clients to help them make informed and strategic decisions about their business and potential risks.

Agriculture plays a major role in the nation’s overall economy, just as much as oil and other resources. The accounting specialists will need an extensive variety of knowledge. They’ll need to be cognizant of fluctuating costs and prices, have an understanding of how unpredictable weather affects the business, and changing commodity prices locally and around the globe.

Farming is a unique type of business with special challenges. Farmers always have the last decision, but they rely on an agricultural accountant to help them plan for purchases of land, equipment and the operation of their business. Agricultural accounts are responsible for filing taxes on time, accounting for assets, liabilities and depreciation, along with meeting specific government regulations and definitions.

Farm accounting is an ideal profession for anyone that loves numbers and farming. They’ll be called upon to keep track of arable land to native plants, pasture to crop production, changes in land use, and even green/sustainable farming practices.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

 

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accounting

Top Career Opportunities in Accounting 2022

A significant number of college students are reassessing their career path. They’re discovering they won’t make as much as they anticipated. A study conducted by Real Estate Witch found that undergrads across all majors overestimated their starting salaries by 88 percent. There are numerous well-paying opportunities in accounting for 2022 and the U.S. Bureau of Labor Statistics projects a significant growth rate in all areas.

Bookkeeper

A bookkeeper maintains a company’s day-to-day financial transactions. They record, prepare and present financial statements to supervisors and managers about some or all of an organization’s accounts. They’re responsible for keeping a running total of costs and income and it represents an excellent opportunity for those entering the field. Bookkeepers enter data, verify billing statements, and work with multiple types of financial software.

Personal Accountant

There’s an almost endless need for personal accounts. They keep track of and help individuals and business owners manage credit card and bank statements, keep tax records, review expenditures, and ensure staff are paid.

Tax Preparer

Individuals, entrepreneurs and small businesses utilize the services of a tax preparer throughout the year to ensure their finances stay on track. Tax preparers prepare taxes, ensure clients are only paying what they should, and help them organize records. They may work for a larger company, but often operate their own business out of their home.

Forensic Accountant

Law enforcement agencies, lawyers, private investigators, insurance companies, government agencies and financial institutions employ forensic accountants. They’re often called as expert witnesses in court cases to prove embezzlement, fraud and other financial wrongdoing. They analyze financial statements, bank records and other documents.

Environmental Accountant

The job includes recording income, expenditures and other transactions related to cost savings. Many companies and corporations employ environmental accountants to create social responsibility statements in terms of energy costs and similar changes relating to green practices.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

 

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accoutant

The Difference Between CPAs and Accounting Firms

One of the most pressing questions for individuals and businesses is whether to hire a certified public accountant (CPA) or an accounting firm. The most important difference is that CPAs are allowed to sign tax returns for clients and represent them during a tax audit. Accountants don’t have the same standing with the IRS. All CPAs are accountants, but not all accountants are CPAs. A CPA has an advanced level of rigorous training, expertise and certification.

The success of any business relies on its financial health and individuals need to choose the right professional for their needs. The terms CPA and accountant are often used interchangeably, but there are distinct differences.

Accountant

An accountant provides basic bookkeeping tasks and can verify the work of an in-house bookkeeper.  They create reports and analyze those documents to generate long-term business plans. The professionals file tax returns and provide tax planning advice. An accountant can perform cash flow management and provide projections, along with bookkeeping services.

Accountants record, maintain and interpret financial records. They ensure the accuracy of financial documents, evaluate operations and can recommend best practices for clients. Accountants can create forecasts, perform risk analysis, and provide guidance on reducing costs and enhancing revenues.

CPA

A CPA provides all the services of an accountant and more, especially forensic accounting. They’re able to detect irregularities ranging from embezzlement to tax evasion. In addition to passing the stringent CPA certification exam, to keep their license, CPAs must also complete yearly educational requirements.

CPAs can legally represent clients before the IRS in the event of an audit. A CPA can file taxes and they utilize the most advanced financial software on the market that’s not available to the average individual. They’re experts in financial planning, provide clients with profit and loss statements, and can assist with profit-sharing and employee benefit packages. CPAs provide the data that business owners need to make sound decisions for the future of their company.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

 

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accounting firm

How to Choose an Accounting Firm

Choosing an accounting firm to handle business interests, personal finances and/or taxes can be confusing. Compounding the problem is the inability to discern which financial services are actually needed or an insufficient budget to hire an accountant. Instead, people often try to navigate their financials on their own and leave money on the table.

Identify Needs

Private individuals and businesses will typically have vastly different needs, though they can intersect. The same is true for startups, established businesses and sole proprietors. Cryptocurrency investors, those with lottery winnings, stocks, and rental properties will need an accountant with experience in those areas.

Qualifications

An accounting firm should be willing to provide their qualifications and areas of specialization in the services for which they’re being hired. Don’t be hesitant about asking questions to discover if they’ve been involved in audits and the outcomes. Seeking referrals from family, friends and/or other business owners is a good way to learn about accounting firms that may be right for an individual’s needs. Don’t forget to contact the Better Business Bureau to determine if there have been any complaints about the firm.

Experience and Support

Having experience in the specific areas for which an accountant is hired can’t be overstated. They’ll know about tax laws, deductions and credits available within specific industries. They’ll also have the expertise to assist with future planning and goal setting. Audits are always a potential event and the accountant should provide support and services that represent the client’s interests in that eventuality.

Near or Far

The location of the accountant relative to the client is important. Individuals may not have the time to drop everything to meet with their accountant. That’s especially true for people that frequently travel or have overseas holdings.

Making Connections

Clients should feel comfortable discussing any facet of their financial or business interests with their accountant. If they don’t, it’s time to find a new accountant. The chosen accountant should be able to explain things in clear and understandable language without jargon specific to the accounting industry.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

 

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Tax Accountant

How can a Tax Accountant Help Me?

Approximately 33 percent of all taxpayers prepare their own taxes each year, thanks to online tax preparation software. What you may not know is that you could be leaving money on the table by not consulting with a tax accountant. Tax laws are highly complex and complicated. The following are just some of the ways that a tax accountant can help.

Minimize Audits

The odds of being audited increase the more you make and a tax accountant will considerably reduce the potential. If you make less than $200,000, the chances of being audited is 0.9 percent. That number increases to 3.7 percent if you make over $200,000 and 12.5 percent if your income exceeds $1 million.

Own a Business

If you own a business, are self-employed, or are in partnership, a tax accountant can determine how much you should pay in quarterly taxes. The benefit is that you won’t be faced with a huge tax bill at the end of the year.

Life Changes

Buying a house, getting married, having a child, getting a divorce, or investing in the stock market are all significant events in anyone’s life. A tax account is able to help you take advantage of the available tax breaks and even help you adjust your withholding to accommodate those changes.

Failure to Pay

If for any reason you failed to pay your taxes in the past or owe a balance, a tax accountant is able to help you file appropriately. He/she will also know about IRS programs designed to help people in these situations.

Other Situations

A tax accountant can help in a wide variety of situations, including if you’re anticipating a large capital gains tax, have investments and income from foreign sources, or if you have rental properties. You can utilize a like-kind-exchange to minimize taxes if you’re thinking of selling real estate. A tax accountant can also help you if you’re planning on making a large gift, putting away money for your kids’ college, or creating a trust.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

 

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tax accountant

Top Tips for Hiring the Right Tax Accountant

In the digital age, a majority of individuals simply file their taxes through an online service that provides tax software. Others make use of tax preparers that can be found at kiosks located in malls and chain stores. The people that work in retail franchises such as H&R Block and Jackson Hewitt are competent for individuals that are filing a very straight forward tax return.

Individuals often find certified public accountants (CPAs) and enrolled agents (EAs) working at those kiosks. EAs are the elite by IRS standards and are allowed to represent clients before the IRS. For those that choose to utilize the experience and knowledge of a tax accountant, there’s some basic information individuals should ascertain before hiring them.

Qualifications

One of the best ways to find a reliable tax accountant is to seek recommendations and referrals from family, friends and business owners. Don’t be reticent about contacting the firm and asking questions. Contact the Better Business Bureau to see if any complaints may have been filed.

The tax accountant should be willing to provide their qualifications and any areas of specialization. Ask if they’ve ever been involved in an audit, how they handled the situation, and the outcome. Tax accountants can’t accept payment without a preparer tax ID number (PTIN). Make sure the tax accountant has one.

Due Diligence

After the initial interview with a tax accountant, individuals can contact the state’s board of accountancy to discover if they’re licensed, in good standing, and if they’ve had any disciplinary actions taken. It can also be helpful to search their name online.

Red Flags

There are some red flags of which every individual should be aware. If a tax accountant promises a large refund before they’ve even looked at a person’s financial situation, look elsewhere. The same is true if they tell a client they can claim an excessive number of deductions.

Shop Around

Every taxpayer and tax accountant won’t be a good fit for each other. Individuals have the right to shop around, change their mind, or even take their return elsewhere if they desire. If necessary, individuals can always ask for an extension on filing their taxes. No one should trust their finances and tax returns to someone without the proper certifications and experience.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

 

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Understanding Depreciation Reporting

In an accountant’s reporting systems, depreciation of a business’s fixed assets such as its buildings, equipment, computers, etc. is not recorded as a cash outlay. When an accountant measures profit on the accrual basis of accounting, he or she counts depreciation as an expense. Buildings, machinery, tools, vehicles and furniture all have a limited useful life. All fixed assets, except for actual land, have a limited lifetime of usefulness to a business. Depreciation is the method of accounting that allocates the total cost of fixed assets to each year of their use in helping the business generate revenue. 

Part of the total sales revenue of a business includes recover of cost invested in its fixed assets. In a real sense a business sells some of its fixed assets in the sales prices that it charges it customers. For example, when you go to a grocery store, a small portion of the price you pay for eggs or bread goes toward the cost of the buildings, the machinery, bread ovens, etc. Each reporting period, a business recoups part of the cost invested in its fixed assets. 

It’s not enough for the accountant to add back depreciation for the year to bottom-line profit. The changes in other assets, as well as the changes in liabilities, also affect cash flow from profit. The competent accountant will factor in all the changes that determine cash flow from profit. Depreciation is only one of many adjustments to the net income of a business to determine cash flow from operating activities. Amortization of intangible assets is another expense that is recorded against a business’s assets for year. It’s different in that it doesn’t require cash outlay in the year being charged with the expense. That occurred when the business invested in those tangible assets.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

 

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The Purpose of Your Accountant

An accountant is a licensed professional who has gone to hell and back to gain their designation as a certified public accountant. The testing for the certification is beyond brutal. If an accountant is certified, it means they are extremely versed in the tax code, finances and tax issues. 

 

Many people are under the mistaken belief that accountants simply provide tax return preparation services. The stereotypical view involves a person dropping off their receipts a month before tax returns are due and the accountant doing the best he or she can to prepare a tax return while limiting the amount of money you owe the government. This occurs, but people are wasting money if this is how they are using their accountant. 

 

Accountants have expertise in the tax code. You should use this. Ideally, an accountant will aware of all aspects of your financial life. They should also be aware of significant events in your private life, such as the fact you are about to have a child. The reason this is important is it gives the accountant the ability to solve your tax mystery. 

 

Solving a tax mystery simply refers to an accountant figuring out the best way to limit your taxes. As you know from police shows on television or mystery novels, finding as many clues as possible is the way to solve the mystery. The accountant needs to do the same with you and you need to help them. Each part of your finances represents a clue to solving the mystery of how to cut your tax bill. 

 

Once an accountant has all the clues, he or she can do their job. They will give you specific direction on the steps to be taken to save money on your tax bill this year. Equally important, they will give you advice on how you are going to save taxes in future years. Depending on your situation, they may even recommend a long-term tax strategy for stuffing away money to pay for your kids’ college tuition or your retirement. 

 

The purpose of using an accountant is not just to put tax returns together. They put together tax strategies to save you money this year, the next and throughout your life.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

 

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Profit and Loss

It might seem like a no-brainer to define just exactly what profit and loss are. But of course, these have definitions like everything else.  Profit can be called different things, for a start. It’s sometimes called net income or net earnings.  Businesses that sell products and services generate profit from the sales of those products or services and from controlling the attendant costs of running the business. Profit can also be referred to as Return on Investment, or ROI. While some definitions limit ROI to profit on investments in such securities as stocks or bonds, many companies use this term to refer to short-term and long-term business results. Profit is also sometimes called taxable income.

It’s the job of the accounting and finance professionals to assess the profits and losses of a company. They have to know what created both and what the results of both sides of the business equation are. They determine what the net worth of a company is. Net worth is the resulting dollar amount from deducting a company’s liabilities from its assets. In a privately held company, this is also called owner’s equity, since anything that’s left over after all the bills are paid, to put it simply, belongs to the owners. In a publicly held company, this profit is returned to the shareholders in the form of dividends. In other words, all liabilities have the first claim on any money the company makes. Anything that’s left over is profit. It’s not derived from one element or another. Net worth is determined after all the liabilities are deducted from all the assets, including cash and property. 

Showing a profit, or a positive figure on the balance sheet, is of course the aim of every business. It’s what our economy and society are built on. It doesn’t always work out that way. Economic trends and consumer behaviors change and it’s not always possible to predict these and what income they’ll have on a company’s performance.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

 

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What are Independent Auditors?

Independent CPA auditors are like referees in the financial reporting arena. The CPA comes in, does an audit of the business’s accounting system and methods and gives a report that is attached to the company’s financial statements. Publicly owned businesses are required to have their annual financial reports audited by independent CPA firms and any privately owned businesses have audits done as well because they know that an audit report will add credibility to their financial reports.

An auditor judges whether the business’s accounting methods are in accordance with generally accepted accounting principles (GAAP). Generally, everything is in place and the financial report is a reliable document. But at times an auditor will wave a yellow or red flag. Some indicators of potential trouble include when the business’s capability to continue normal operations is in doubt because of what are known as financial exigencies, which could mean a low cash balance, unpaid overdue liabilities, or major lawsuits that the business doesn’t have the cash to cover.

An auditor must exercise professional skepticism, meaning the auditor should challenge the accounting methods and reporting practices of the client in order to make sure that its financial statement conforms with accounting standards and are not misleading – in short, that the financial statement are fairly presented. Indeed, the words “fairly presented” are the exact words used in the auditor’s report.

A good auditor needs technical know-how, but also needs to know how to be tough on the accounting methods of the client. His job is to be the agent of the shareholders and other users of the business’s financial report. It’s incumbent on an auditor to strictly uphold GAAP, and not let any irregularities slide. 

There are a number of well-known companies that engaged in accounting fraud recently and that fraud was not discovered by the CPA auditors. Enron is one of these companies. In this case, the auditing firm, Arthur Anderson was found guilty of obstruction of justice because it destroyed audit evidence.

At Peavy and Associates PC our mission is to assist you with all your tax preparations, payroll and accounting needs.  We provide our clients with professional, personalized accounting services and guidance in a wide range of financial and business needs. Give us a call today and discover why our clients return to Peavy and Associates, PC year after year!

 

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