Related-party transactions and financial connections are a normal part of operating a business. But these arrangements have gotten a bad rap because dishonest people sometimes use them to disguise poor performance or dishonest activities. So, identifying related parties and evaluating your interactions with them are important parts of the external audit process — especially in today’s volatile market conditions.
The typical defrauded not-for-profit loses $75,000 per fraud incident, according to the Association of
Certified Fraud Examiners. And that doesn’t account for the negative publicity and subsequent lost
donations and support that often follow fraud. Although no preventive measure is 100% effective,
strong internal controls can greatly reduce the risk that a crooked staffer or outside criminal will find
gaps in your fortress.
Updated accounting rules for long-term leases took effect in 2019 for public companies. Now, after several deferrals by the Financial Accounting Standards Board (FASB), private companies and private not-for-profit entities must follow suit, starting in fiscal year 2022. The updated guidance requires these organizations to report — for the first time — the full magnitude of their long-term lease obligations on the balance sheet. Here are the details.
Someone might have once told you that human beings use only 10% of our brains. The implication is that we have vast, untapped stores of cerebral power waiting to be discovered. In truth, this is a myth widely debunked by neurologists.
What you may be underusing, as a business owner, is your accounting software. Much like the operating systems on our smartphones and computers, today’s accounting solutions contain a multitude of functions that are easy to overlook once someone gets used to doing things a certain way.
By taking a closer look at your accounting software, or perhaps upgrading to a new solution, you may be able to improve the efficiency of your accounting function and discover ways to better manage your company’s finances.
The IRS has published new guidance on the Employee Retention Credit (ERC). The credit was created in March 2020 to encourage employers to keep their workforces intact during the COVID-19 pandemic. Notice 2021-49 addresses various issues, particularly those related to the extension of the credit through 2021 by the American Rescue Plan Act (ARPA).
The guidance comes as Congress weighs ending the ERC early to help offset the costs of the pending infrastructure bill. As of now, the credit is worth as much as $28,000 per employee for 2021, or $7,000 per quarter.
Auditors typically deliver financial statements to calendar-year businesses in the spring. A useful tool that accompanies the annual report is the management letter. It may provide suggestions — based on industry best practices — on how to fortify internal control systems, streamline operations and reduce expenses.
Managers generally appreciate the suggestions found in management letters. But, realistically, they may not have time to implement those suggestions, because they’re focusing on daily business operations. Don’t let this happen at your company!
If your nonprofit doesn't comply with recently updated federal procurement guidelines, it could risk its funding. Here's how to ensure your policies and purchases adhere to the rules.
If your business's bottom line is strong, that's good news. But you still need to keep a close eye on cash flow. Here's why.
Who needs benchmarking? You, your nonprofit’s employees and board of directors do! We explain how best to measure performance to reach mission-critical goals.
From financial oversight to risk management to avoiding conflicts of interest, there's a lot that nonprofit board members need to know. Here's a quick summary.
Have you created a viable succession plan for your business? This daunting task can be made easier by choosing the right perspective
A strong internal control system can protect your organization from a variety of risks, including recordkeepting errors and employee theft. Here are three basic controls that you should take a look at annually.