Skip to main content Skip to search

small business accounting

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!

 

Contact Us Today

Read more

How To Find A Good Accountant

Finding a good accountant does not always end up being a simple task. There are so many accountants that seem to appear every year, it is hard to know who to choose to put in charge of your finances. Finding an accountant is a very serious task that is never taken lightly, especially since it involves your business. Here are two simple steps of how to choose an accountant that you can trust with your business’s finances. 

The first thing you do to find a good accountant is to build a list of referrals from credible sources. To find resources for these referrals may seem like a daunting task at first, however, it is simpler to accomplish this goal than what you think. You can go to such resources such as your local bank, any type of financial planners that you may have, and you can even talk to your current insurance agent about people they know about to be your accountant. If you have any contacts or affiliations with other businesses, then you can ask them for accountant referrals as well. These are all trusted resources that can provide you with some good leads on who you can trust to be your accountant. Finding accountant candidates through trusted resources such as your business’s bank is one of the best ways to find an accountant.  Most professional referrals like this mean that the accountant has a good reputation. 

Once you have your accountant referrals, you then want to contact them and exchange information. Feel free to tell the accountant about your business as well as your accounting needs and expectations. While you give the accountant your information, also ask for theirs. Some key things you want to find out is if the accountant can handle a business in your industry and your size, as well as finding out all of the services they offer. Do not be afraid to look at their portfolio and get estimates for their services. Be sure you know what services the fees cover. You never want to select an accountant whose fees are too high for what you can afford. Make sure that you can maintain a good line of communication and determine if they are helpful and informative. The accountant who offers the most detail and takes the most time to not only tell you about the services they can offer you, but also listens to your concerns, is usually the type of accountant that you are looking for. 

After gathering all of the information about the accountants, then make the decision of who is the right accountant for you. Remember that you will be having a long business relationship with your accountant, so you want to select an accountant that you feel you can build a good rapport with as well as someone who will have you and your business’s best interest in mind.

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!

 

Contact Us Today

Read more

7 Great Accounting Jobs Right out of College

Anyone going into the accounting field should know that there are abundant opportunities for employment straight out of college, with jobs available in the private and public sectors. Those that want to work with multiple clients can find satisfaction in public accounting. For those that prefer to work for a single company, private accounting may be a better choice.

Accounts Payable

A wide range of businesses, particularly in the healthcare field, employ accountants to perform collection calls on overdue accounts, send invoices, and resolve problems with clients in regard to their bills. It’s a rapidly expanding field with multiple opportunities.

Auditing

Auditing is more than just ensuring that the numbers add up. A wide array of companies employ accountants to look for sources of lost revenue. That can encompass identifying areas of duplicated effort or deficiencies in control mechanisms. Individuals may also be responsible for investigating consumer or vendor claims.

Bookkeeping

Accounts are essential personnel for any business endeavor. In addition to tracking and monitoring income, costs, and financial transactions, individuals will be responsible for providing clients with regular reports and updates about their financial status. They are often called upon to handle a company’s payroll. Don’t overlook the opportunities for accountants at schools, universities, and government entities.

Forensics

The job of a forensic accountant is to examine data, discover where money has gone missing, and how to recover it. As individuals advance in the field, they may also be called upon to testify in court cases as an expert witness and work with law enforcement personnel.

Information & Technology

This is ideal for individuals that are as enthusiastic about technology as they are numbers. There’s a myriad of accounting software from which individuals and companies can choose and accountants in this field will be responsible for helping clients select the best financial software for their needs.

Loans and Analysis

Believe it or not, many banks employ accountants as tellers, credit analysis specialists, and loan officers. Individuals often perform credit checks and financial pre-approvals for loans on homes, vehicles, and business equipment.

Tax Preparation

Preparing taxes is an essential service and many newly fledged accountants begin illustrious careers performing tax preparation. It’s also possible for accountants to acquire regular business clients through the contacts they make doing taxes.

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!

 

Contact Us Today

Read more
CPA Consultant Conway South Carolina

Top Qualities of a Good Accounting Firm

An accounting firm is a great way to relieve the stress of tax time and it’s a real time saver for individuals already pressed for time. Hiring the right firm may not be so easy, though. In today’s world, being “good with numbers” or the least expensive option isn’t enough. One little mistake in this field can have serious and expensive repercussions.

A good accounting firm does more than simply keep the books and file your taxes. It will be able to effectively communicate a wide range of business information and opportunities. The following are the top qualities that an accounting firm should exhibit.

Personalized Service

Each business is different and a superior accounting firm understands that. A full service tax firm will be able to help you develop tax strategies, create plans to meet financial goals, and help you manage your assets. Your accounting firm should meet with you several times a year, not just at tax time.

Experience and Education

The accounting firm should have experience in your particular industry. That means they’ll know your business and any applicable deadlines. Tax laws change frequently and without notice. An accounting firm will be cognizant of current tax laws and how they impact your business. The firm’s accountants will have extensive education and should have met the licensing requirements of a certified public accountant (CPA).

Accuracy and Detail

You’ll obviously want a firm that’s accurate, which means it will be detail oriented. The firm will prepare reports to keep you informed of your financial status, identify potential issues and suggest solutions, and provide guidance to reduce costs, enhance revenues, and maximize profitability.

Technology Literate

The days of accountants laboring with paper and pencil are long gone. An accounting firm should be utilizing state-of-the-art technology, advanced accounting software, and other technology-based tools.

Business Strategies

An accounting firm will be able to provide effective advice and strategies whether the business is a start-up or an established company of long standing. The firm will be able to provide you with the information you need to make sound and informed business decisions that helps your enterprise grow and evolve.

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!

 

Contact Us Today

Read more

Keeping your Business up to Date with Tax Laws

Tax laws change quickly and often with very little warning. It can seem like an impossibility to keep track of all the changes and utilize them to your business advantage. You have three choices when preparing your taxes – do them yourself, use tax preparation software, or have a professional do them.

No matter which option you choose, changes in tax laws will ultimately affect your business in some way. It’s much better to engage the services of a professional accountant than be surprised at tax time. It’s an accountant’s business to know about changes, inform clients, and help them develop a strategy to minimize tax liability.

Your business will need to remain legally compliant with all state laws – which will depend on where you live – along with federal tax laws. There will be different requirements, depending upon your business structure and you’ll need to ensure all certificates, licenses, and permits are current.

As a small business owner, you’ll be subject to a variety of different taxes unless you’re in a partnership – in which case you’ll be required to file an information return. You’ll be required to pay self-employment taxes and employment taxes on employees. Sole proprietors, S corporation shareholders, and partners will pay estimated taxes and you’ll need to have withheld a sufficient amount to meet tax liabilities.

There are also excise taxes, which can often seem very vague but cut across multiple industries. You’ll be liable for these if you operate certain types of businesses, sell specific products, offer certain types of services, or use specific types of equipment, facilities or products. Some classic examples are alcohol, fuel and tobacco, but the list is extensive.

Of special interest for business owners are changes for net operating losses, first-year depreciation, pass-throughs that include sole proprietorships, S corporations, and LLCs, and those that have significant operations overseas. Many individuals outsource their marketing and other functions when applicable through the gig economy and accounting for that can be a headache for you and the person that provided the services.

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!

 

Contact Us Today

Read more

Accounting Experts can Save your Business Money

Business owners mistakenly believe they’re saving money by attending to their accounting task themselves. What they’re actually doing is taking time away from their families and other business tasks such as planning for future growth. Hiring an accounting firm to care for your finances saves time, money, and enables you to focus on other priorities.

Business Planning

Professional accounting firms work with businesses at all stages of development – from startups to long-established endeavors. They have a wealth of experience they can utilize to help you advance your business to the next stage in its evolution and provide guidance on managing monetary growth. They can also assist if you need to make changes in its structure.

Informed Decisions

Your accountant will be able to advise you on multiple issues to help you make better informed decisions about your business. They can advise you on a variety of topics ranging from strategies to provide the best return on your investment to endeavors that are risky for your business.

Streamlining

A professional accountant can streamline your books, establish better bookkeeping practices, and “find” money you never even knew you had. You’ll know exactly where your money is going, how much, and discover ways to save your business money. A professional can also assist with strategic spending and saving money with vendors and others with which you regularly conduct business.

Tax Penalties

An accounting professional will be cognizant of all the current tax laws to save you money and avoid errors or omissions that lead to tax penalties. The firm’s professionals will know your business and meet all applicable deadlines, while minimizing taxes and maximizing benefits for greater profitability.

Exit Strategies

There will come a time when you decide to retire and an accounting firm can help you define the best time to exit or what you may need to do before selling the business.

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!

 

Contact Us Today

Read more