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The Value Report - Machen McChesney Business Advisory Insights

At Machen McChesney we are committed to Returning Value to you through our monthly e-newsletter, The Value Report.

Here you'll find regular tips to help with your business and personal finances, as well as strategies to grow and more efficiently run your organization. 


Table of Content

  1. How Auditors Assess Risk When Preparing Financial Statements 
  2. Buy Business Assets Before Year End to Reduce Your 2018 Tax Liability
  3. LIFO Lessons Learned
  4. It's Not Too Late: You Can Still Set Up A Retirement Plan For 2018
  5. A Fresh Look At Percentage Of Completion Accounting
  6. Tax Reform Expands Availability of Cash Accounting
  7. Here's A Smart Tax Move
  8. 4 Steps To Auditing AP
  9. When Holiday Gifts and Parties are Deductible or Taxable
  10. Why Revenue Matters In An Audit
  11. What's New at Machen McChesney

How Auditors Assess Risk When Preparing Financial Statements

iStock-1048873698-503598-editedEvery year, your audit firm will conduct a fresh risk assessment before the start of fieldwork. Why? Because your auditor wants to mitigate the risk of expressing an incorrect opinion regarding the accuracy and integrity of the company’s financial statements. Inadvertently signing off on financial statements that contain material misstatements can open a Pandora’s box of risks — from shareholder lawsuits to increased regulatory oversight. Continue reading


Buy Business Assets Before Year End to Reduce Your 2018 Tax Liability

iStock-647633878-773466-editedThe Tax Cuts and Jobs Act (TCJA) has enhanced two depreciation-related breaks that are popular year-end tax planning tools for businesses. To take advantage of these breaks, you must purchase qualifying assets and place them in service by the end of the tax year. That means there’s still time to reduce your 2018 tax liability with these breaks, but you need to act soon. Continue reading.


LIFO Lessons Learned

iStock-1039750426-317854-editedYou have choices when it comes to reporting inventory costs. One popular technique — the last-in, first-out (LIFO) method — assumes that merchandise is sold in the reverse order it was acquired or produced. That is, it allocates the most recent costs to the cost of sales. Although this method is often preferred for tax purposes, internal accounting personnel may be hesitant to use it for various reasons. Continue reading


It's Not Too Late: You Can Still Set Up A Retirement Plan For 2018

iStock-895857266-446637-editedIf most of your money is tied up in your business, retirement can be a challenge. So if you haven’t already set up a tax-advantaged retirement plan, consider doing so this year. There’s still time to set one up and make contributions that will be deductible on your 2018 tax return! Continue reading 


A Fresh Look At Percentage Of Completion Accounting

iStock-1011049164-121836-editedHow do you report revenue and expenses from long-term contracts? Some companies that were required to use the percentage of completion method (PCM) under prior tax law may qualify for an exception that was expanded by the Tax Cuts and Jobs Act (TCJA). This could, in turn, have spillover effects on some companies’ financial statements. Continue reading.   


Tax Reform Expands Availability of Cash Accounting

iStock-866779874-1-713403-editedUnder the Tax Cuts and Jobs Act (TCJA), many more businesses are now eligible to use the cash method of accounting for federal tax purposes. The cash method offers greater tax-planning flexibility, allowing some businesses to defer taxable income. Newly eligible businesses should determine whether the cash method would be advantageous and if so, consider switching methods. Continue reading


Here's A Smart Tax Move

IFF_DonateArt_IMAGE_560x292Donate appreciated art by year end. Continue reading. 


4 Steps To Auditing AP

iStock-949219374-231983-editedAt most companies, the accounts payable (AP) department handles an enormous volume of transactions. So, the AP ledger may be prone to errors or used to bury fraudulent journal entries. How do auditors get a handle on AP? They use four key procedures to evaluate whether this account is free from “material misstatement” and compliant with the U.S. Generally Accepted Accounting Principles (GAAP). Continue reading.


When Holiday Gifts and Parties are Deductible or Taxable

iStock-827986408-433321-editedThe holiday season is a great time for businesses to show their appreciation for employees and customers by giving them gifts or hosting holiday parties. Before you begin shopping or sending out invitations, though, it’s a good idea to find out whether the expense is tax deductible and whether it’s taxable to the recipient. Here’s a brief review of the rules. Continue reading.


Why Revenue Matters In An Audit

iStock-932162698-1For many companies, revenue is one of the largest financial statement accounts. It’s also highly susceptible to financial misstatement. Continue reading.


What's New at Machen McChesney?

iStock_41667068_LARGE-822670-edited.jpgSponsorships, new hires, announcements
Continue reading.


 

We hope you found value in The Value Report you've received this month. We look forward to finding even more ways to Return Value to you in the future. 

Please feel free to visit our website or visit our blog at any time during the month to interact with additional valuable resources and helpful information.
 
If you have any questions on the topics above, please feel free to send us a message.
 
Thanks,
Machen McChesney 
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Montgomery: 1761 Taliaferro Trail | Montgomery AL 36117

www.machenmcchesney.com

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