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New revenue recognition standard: subscription based organizations

After almost five years of talking about it, the long-anticipated revenue recognition standard is now being employed by the public filers. Private companies still have some time, but don’t procrastinate. There is a lot you need to do in 2018 to be able to apply the standard and the full or modified retrospective application. How …

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Revenue recognition: costs of obtaining contracts

By now most of us are experiencing information overload on the new revenue recognition standard and are contemplating to jump ship before the standard comes into effect. The Accounting Standard Codification introduces Topic 606 (too close to triple-six if you ask me), Revenue from Contracts with Customers, and it is effective to all nonpublic companies …

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Revenue recognition: manufacturing impact

The new revenue recognition standard is rapidly approaching with implementation only months away. If your distribution channels are simplistic in nature and your contracts are typically simplistic or generally simple purchase orders, you probably won’t have any significant impact. On the other hand, if any of these items apply, your accounting for revenue is likely …

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New revenue recognition standard, time to get ready

Accounting standards are constantly evolving, with new ones issued from the Financial Accounting Standards Board (FASB) every year. Many times, they have no impact to most private companies. However, the FASB’s new revenue recognition standard is expected to have one of the most far-reaching impacts seen in quite some time. Even if it doesn’t change …

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AZ Prop 206 and accounting for unused vacation, sick pay

In November 2016, Prop 206, the Fair Wages and Healthy Families Act was approved. The Act established a new state minimum wage effective January 1, 2017 and entitled employees to accrued earned paid sick time beginning July 1, 2017. This newly required accrued sick time may have an impact on your year-end accruals. A few …

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The importance of understanding your cash flow

Cash is King! That’s what we all learn in Accounting 101. And every business owner knows that cash is the heartbeat of the business. Profitable companies can go out of business because they do not have enough cash on hand to pay their debts. This makes it all the more important that you know exactly …

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How to account for subsequent events

Financial statements generally report on a company’s financial position for a specified period of time or reporting period. However, sometimes transactions will occur after the reporting period has ended and the point in time when the financial statements are ready to be issued. These transactions may influence a user of the financial statements opinion on …

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Year-end physical inventory count instructions

The year-end physical inventory count can be a daunting task for companies that have large amounts of inventory. Having a successful physical inventory count relies heavily on planning, emphasis and direction provided by management. There can be significant ramifications to an unsuccessful inventory count such as recounts of total inventory, material adjustments to accounting records, …

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The basics of preventing fraud in any business

Upon hearing the term “fraud,” companies like Enron and Worldcom typically come to mind. While it’s usually these large, complex cases that get the public’s attention, the truth is that numerous forms of fraud can run rampant in any type of organization. In fact, a study by the Association of Certified Fraud Examiners (ACFE) reported …

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New method of accounting for credit losses

A number of Accounting Standards Updates (“ASU”) will become effective in the next few years, and perhaps most notable among them are the new lease and revenue recognition standards. ASU 2016-13, which introduces ASC 326 to the codification, will also be impactful and is worth taking note of. While the new standard will not be …

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