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Returning Value Blog

Aaron K. Waller, CPA

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How External Confirmations Are Used During an Audit

Posted by Aaron K. Waller, CPA on Aug 08, 2022

Auditors commonly use confirmations to verify such items as cash, accounts receivable, accounts payable, employee benefit plans, and pending litigation. Under U.S. Generally Accepted Auditing Standards, an external confirmation is “a direct response to the auditor from a third party either in paper form or by electronic other means, such as through the auditor’s direct access to information held by a third party.”

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Remote Auditing: A Brave New World

Posted by Aaron K. Waller, CPA on Jul 19, 2022

The pandemic has presented numerous challenges for businesses, but it also taught us how to be resilient, cost-conscious, and adaptable. Over the last few years, we’ve learned that remote working arrangements offer many benefits, including reducing the time and cost of performing many tasks. Here’s how these lessons translate to the work auditors do to prepare your company’s financial statements.

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Take Your Financial Statements to the Next Level.

Posted by Aaron K. Waller, CPA on Feb 22, 2022

Spring is the time of year that calendar-year-end businesses issue financial statements and prepare tax returns. This year, take your financial data beyond compliance. Here’s how financial statements can be used to be proactive, not reactive, to changes in the marketplace.

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Preparations vs. Compilations

Posted by Aaron K. Waller, CPA on Jan 26, 2022

Your business needs financial statements so management can monitor performance, attract investment capital and borrow money from a bank or other lender. But not all financial statements are created equal. Audited statements are considered the “gold standard” in financial reporting. While public companies are required to issue audited statements, smaller, privately-held organizations have options. CPAs provide three other types of financial statements, which, in order of descending level of diligence, are: reviews, compilations, and preparations.

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How to Assess Fraud Risks Today

Posted by Aaron K. Waller, CPA on Nov 18, 2021

Auditing standards require external auditors to consider potential fraud risks by watching out for conditions that provide the opportunity to commit fraud. Unfortunately, conditions during the COVID-19 pandemic may have increased your company’s fraud risks. For example, more employees may be working remotely than ever before. And some workers may be experiencing personal financial distress — due to reduced hours, decreased buying power, or the loss of a spouse’s income — that could cause them to engage in dishonest behaviors.

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Flash Reports: Real-Time Financial Reporting

Posted by Aaron K. Waller, CPA on Oct 07, 2021

Timely financial reporting is key to making informed business decisions. Managers need to know what’s in the pipeline to respond promptly and decisively. Unfortunately, it typically takes several weeks to prepare financial statements under U.S. Generally Accepted Accounting Principles (GAAP). And many companies only produce GAAP financials at the end of the quarter or year. In the meantime, managers may turn their attention to simple “flash” reports.

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Private Companies: Are You on Track to Meet the 2022 Deadline for the Updated Lease Standard?

Posted by Aaron K. Waller, CPA on Aug 24, 2021

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 the 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.

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Internal Control Questionnaires: How to See the Complete Picture

Posted by Aaron K. Waller, CPA on Jul 21, 2021

Businesses rely on internal controls to help ensure the accuracy and integrity of their financial statements and prevent fraud, waste, and abuse. Given their importance, internal controls are a key area of focus for internal and external auditors.

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How to Strengthen Your Internal Controls

Posted by Aaron K. Waller, CPA on Jun 04, 2021

Internal controls are a system of policies and procedures organizations put in place to protect assets and improve operating efficiency. Effective internal controls are critical to accurate financial reporting. A solid system of controls can help prevent, detect and correct financial misstatements due to errors and fraud.

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Assessing and Mitigating Key Person Risks

Posted by Aaron K. Waller, CPA on Jan 21, 2021

Auditing standards require a year-end risk assessment. One potential source of risk may be a small business’s reliance on the owner and other critical members of its management team. If a so-called “key person” unexpectedly becomes incapacitated or dies, it could disrupt day-to-day operations, alarm customers, lenders, and suppliers, and drain working capital reserves.

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