October 18, 2021
No matter the size of your business, understanding the details of finances is an important step in determining overall success. While many small business ventures fail within the first couple of years, knowing precisely where the monies generated are then being used and getting a firm grasp on profit margins can help elevate your business practices, in addition to providing a foundation on which to build your organization.
For general accounting purposes, there are three levels of review -Â audit, review, and compilationÂ - that are utilized in order to generate a report on business finances. Often completed by an outside agency, this provides a second opinion and unbiased look at the financial records to ensure a number of different factors. Locating any discrepancies or fraud is always a possibility, but many times these reports are created to allow for owners and stockholders of an organization to keep track and make necessary changes in an effort to optimize their business.
The major difference between these three options involves the depth of the review process. Audits are the most extensive and compilations the least invasive but they still can provide the following benefits.Â
Compilations provide business owners with a general report that can be utilized in-house to check on the financial health of a company. These figures are typically not reported to outside sources and can provide those who see them a better understanding of precisely where the company stands.
These reports can provide effective feedback on the day-to-day operations of an organization. Seeing first-hand if the income is covering the cost of areas that can be adjusted to increase profit margins is an important step in ensuring the success of your business.
Utilized on a specific schedule - monthly, quarterly, or semi-annually - compilations can be compared to a physical for the human body. Just as people typically visit their physician to monitor any issues annually, compilations provide a similar service to your business.
Understanding if youÂ need an audit, review, or compilationÂ completed for your business and the desired outcomes will also effectively change the pricing of each service. Audits require much more in-depth research and reporting, generally increasing their cost whereas compilations can be a cheaper alternative if they coincide with desired results.
If you are in need of a particular level of support for the finances of your business then let the tax and experts atÂ Bloch Rothman and AssociatesÂ assist you or your business today. In addition, they can also take care of multiple other issues dealing with paying or owing back taxes, required audits from other entities besides the IRS, or any other personal or corporate wealth management issues. Along with providing a quality tax service, our group can also complete tax returns or answer any other factors associated with financial issues or concerns you may have.
Serving in Denver and all of the surrounding areas for 35 years, our firm has an extensive history of helping clients with any and all of their tax issues or dealings with the Internal Revenue Service. If you have questions about your personal, business, estate, or any other filings, donâ€™t hesitate toÂ contact usÂ today. Available for all of your tax needs and filings, there are also a number of bookkeeping and payroll services offered to assist you and your business. We look forward to meeting you and serving whatever your needs may be soon!