Returning Value Blog

In today’s volatile economic climate, organizations face mounting pressures that can increase the risk of fraudulent activities. Auditors play a pivotal role in identifying and mitigating these risks through comprehensive fraud risk assessments and tailored audit procedures.

In recent years, interest rates have increased and credit has tightened. Under these conditions, which are expected to persist in the coming months, securing a commercial loan can be challenging for businesses of all sizes. Whether you want to expand, stabilize your cash flow, or simply build a financial cushion, being loan-ready is more critical — and more complicated — than it’s been in the past.

Risks are unavoidable in today’s volatile, uncertain marketplace. However, proactive owners and executives can manage business risks more effectively with an enterprise risk management (ERM) framework. A structured approach helps organizations anticipate risks, seize opportunities, and build resilience.

Subsequent events are in the spotlight these days. The Public Company Accounting Oversight Board (PCAOB) recently initiated a project to modernize outdated auditing standards related to these events. The PCAOB says the audit guidance hasn’t kept pace with changes in financial reporting frameworks, risk assessment methodologies, and technological advancements. This has resulted in inconsistencies in how companies account for post-balance-sheet developments in their financial statements.

Financial forecasting provides a roadmap to guide your organization on the path to success. Forecasts support strategic planning by helping you allocate resources efficiently, manage risks effectively, and optimize capital investments. However, today’s dynamic marketplace is uncharted territory, so you can’t rely solely on historical data. Reliable forecasts also consider external market trends and professional insights. Here are some tips to strengthen your forecasting models and help you avoid common pitfalls.

Auditing standards require auditors to identify and assess the risks of material misstatement due to fraud and to determine overall and specific responses to those risks. Here are some answers to questions about what auditors assess when interviewing company personnel to evaluate potential fraud risks.

Financial statements provide insights into a company’s historical performance. But, the parties to a merger or acquisition are also interested in assessing the acquisition target’s potential to generate cash flow in the future. That’s where an independent quality of earnings (QOE) report comes into play.

Audit season is just around the corner for calendar-year entities. Understanding the types of source documents your audit team might request can minimize disruptions during audit fieldwork and maximize your audit’s effectiveness. Here are some common sources of “substantive evidence” that auditors gather to help them form an opinion regarding your financial statements.

The IRS has been increasing its audit efforts, focusing on large businesses and high-income individuals. By 2026, it plans to nearly triple its audit rates for large corporations with assets exceeding $250 million. Under these plans, partnerships with assets over $10 million will also see audit rates increase tenfold by 2026. This ramp-up in audits is part of the IRS’s broader strategy, funded by the Inflation Reduction Act, to target wealthier entities and high-dollar noncompliance.

When reviewing their income statements, business owners tend to focus on profits (or losses). But focusing solely on the bottom line can lead to mismanagement and missed opportunities. Instead, you should analyze this financial report from top to bottom for deeper insights.