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At CPA Miami, we also provide auditing services. Our auditing services include:
• Audits of financial statements of a non-public Companies;
• Audits of financial statements of condominium associations or homeowner associations;
• Performing financial analysis, document assembly and assistance for other auditors to significantly reduce audit fees;
• Outsourced internal audit functions of compliance and operational efficiencies;
• Analysis and review of operational controls;
• Fraud examinations;
• Performing agreed upon procedures for third party lenders in the assessment of loan risk and review of compliance with loan covenants;
• Performing audits of lessees pursuant to percentage rent contract provisions
• Representing taxpayers in IRS Audits or Examinations
Frequently Asked Questions Regarding Financial Audits:
• What is a financial audit?
A financial audit, or more accurately, an audit of financial statements, is the review of the financial statement analysisof a company or any other legal entity, resulting in the publication of an independent opinion on whether or not those financial statements are relevant, accurate, complete, and fairly presented.
• What is the purpose of an audit?
The financial audit is one of many assurance or attestation functions provided by accounting and auditing firms, whereby the firm provides an independent opinion on published information.
The audit is designed to reduce the possibility that a material misstatement is not detected by audit procedures. A misstatement is defined as false or missing information, whether caused by fraud (including deliberate misstatement) or error.
In the US, the CPA firm provides written assurance that financial reports are fairly presented in conformity with generally accepted accounting principles (GAAP).
• Why is an audit performed?
Financial auditexist to add credibility to the implied assertion by an organization’s management that its financial statements fairly represent the organization’s position and performance to the firms’ stakeholders (interested parties).
• Who performs an audit?
Financial audits are typically performed by firms of practicing accountants due to the specialist financial reporting knowledge they require.
• Who uses audit information?
The principal stakeholders of a company are typically its shareholders, but other parties such as tax authorities, banks, regulators, suppliers, customers and employees may also have an interest in ensuring that the financial statements are accurate.
• When is an audit required?
Audits may be required by regulation or stipulation with agreements of the organization. For example, lenders may require an audit of the financial statements of an organization to help provide assurance as to the assertions of an organization in compliance with loan agreements.
Other organizations may be required to have the financial statements audited in accordance with regulatory provisions. For example, condominium associations may be required to have the financial statements audited pursuant to regulations to help provide oversight control to homeowners.
• How much does an audit cost?
This is difficult to say because all organizations requiring an audit are quite different. Factors of consideration are how extensive the audit must be, who are the ultimate users of the audited financial statements, whether an audit has been previously performed and by whom, etc.
• How do you get started?
To begin an audit, you will first need to talk with us to make a determination of whether an audit is most applicable or some other financial procedures are needed. Once the determination of which procedures are best is determined, the next step is to review if we have the expertise and availability to help you and that you available have the records and documentation in performing the audit and a projection of the audit fees associated with your audit engagement. The initial consultation in performing these basic procedures is provided at no cost or obligation. Call today!

Click here for State and local tax

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Planning to get the most out of any new business venture begins with making sure you get the greatest possible tax advantages for your investigation costs, start-up expenses, and other organization costs. These include costs such as advertising, salaries and wages of employees-in-training, travel and other expenses of lining up customers, suppliers, and distributors, and fees paid for consultants services and professional services.

You may assume that all of these start-up expenses are deductible as business expenses in the year you pay them, but that is not the case. Such expenses are not considered to be business expenses because they are not incurred in a going business. Instead they must be capitalized unless you make a proper election to amortize them ratably over a period of no less than 60 months once the business starts to operate. The costs of organizing a corporation can also be amortized over 60 months, if the corporation properly elects to do so.

Another complication with start-up expenses is that they are amortizable only by the person who incurs them. If your new business is going to be a sole proprietorship, that won’t be a problem. However, if the venture is to be a corporation, you can’t personally deduct the costs you incur before incorporation. Those costs are part of your investment in the corporation’s stock; you may want to contribute the funds to the corporation and let the corporation incur the expenses so that it can amortize them.

It’s also important to know that some expenses are treated more favorably than the regular start-up costs we have been talking about, and some less favorably. Start-up expenses for interest, taxes, and research costs usually can be deducted in the year paid. The cost of tangible property purchased for use in the business can be recovered by way of accelerated depreciation deductions over various periods, depending upon the type of asset, but generally faster than start-up costs. On the other hand, the costs of buying intangible assets for use in your business, such as customer lists or the goodwill of a purchased business, have to be written off over 15 years.

You want to be sure that you get whatever tax benefit you can from all of these expenses. To do so, you need to coordinate the expenses with the business’s starting date, and properly make the necessary elections. If you are expanding an existing business, rather than starting a new one, you may be able to deduct the expansion costs currently. We would be glad to help you explore these possibilities further to be sure that you avoid any costly pitfalls. Please do not hesitate to call our offices if you need any assistance for tax accounting services when planning your business start-up.

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Buying or leasing an auto for the use of your employees ought to be an uncomplicated transaction from the tax viewpoint, but it’s not. The plain fact is that the company auto creates more tax complications than almost any other type of business asset. That’s why it’s imperative for you to formulate an overall strategy with our experts, one that yields the maximum in tax savings, while keeping your paperwork and administrative burden at a minimum. This strategy will take into account the special rules that apply to your deductions for the company auto, the tax consequences of an employee’s personal use of a company auto, and the payroll implications of such personal usage.

As a general rule, your company can claim depreciation deductions for the full cost of a purchased company auto, or fully deduct its lease cost if it rents the car, as long as the value of the employee’s personal use of the car is treated as fringe benefit compensation income. However, there are extra complications if the car is what the tax law considers to be a luxury auto. For cars bought or leases commencing in 2002, for example, this means a car valued at approximately $15,300. Depreciation deductions are artificially low for purchased company autos that fall in the “luxury” class, which means it will take longer to recover your cost. And if your company leases a “luxury” company auto, it will wind up with a special add-back to income (called the lease inclusion amount) that varies with the value of the car and the year of the lease.

The employee’s personal use of the company auto creates a separate category of tax accounting services . That’s because the value of the employee’s personal mileage must be treated as noncash fringe benefit income that is taxable to the employee, but not deductible by the company (its deductions consist of depreciation or lease deductions and operating costs). There are four separate ways to value employee personal mileage, and each of them carries its own rules and conditions. Three of the four methods require detailed record keeping of business and personal usage.

The fringe benefit value of personal use of the company auto generally is subject to federal income tax withholding and FICA tax. However, your company can elect not to withhold federal income tax if it properly notifies affected employees of this choice. In addition, your company can choose to treat the company car as having been used entirely for personal travel. This option will greatly simplify the company’s record keeping burden, but usually will create extra taxable income for your employees.

Although the rules for company autos are complex, we can show you how to minimize their impact on your bottom line, on your payroll department, and on your employees. Please do not hesitate to call at your convenience for an appointment for accounting & bookkeeping services.

Certified public accountant

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Before you start a new business, there are a number of preliminary decisions to be made. One of the first choices you will face is the legal form in which you will operate the business. Should it be an unincorporated sole proprietorship, a partnership, a limited liability company, a regular corporation, or an S corporation? Each of these forms has both tax and non-tax advantages and disadvantages that must be weighed in conjunction with your own plans and personal situation.
Sole proprietorships, for example, are the easiest and cheapest business form to set up, and they can be operated with few formalities. However, they offer no personal liability protection and don’t allow you to get many of the tax benefits that are available to corporate employees.
Partnerships offer many of the same advantages and disadvantages as the sole proprietorship, but they allow the business to be owned and run by more than one person. Also, the liability problem can be overcome to a certain extent by forming a limited partnership, but partners whose liability is limited cannot be involved in actively managing the business. And losses from these partnerships may be restricted by the so-called passive activity rules.

A newer form of entity, known as the limited liability company, which is approved for use in almost every state, offers what many see as the best alternative for the typical small business. These entities can be set up to be taxed as partnerships, avoiding the corporate income tax, while the managing members ‘personal assets remain fully protected from business creditors.

S corporations also offer liability protection, without a separate corporate tax. Like partners and sole proprietors, however, more-than 2% S corporation shareholders are ineligible for tax-favored fringe benefits. Another potential drawback of S corporations results from limitations on the number and kind of permissible shareholders. These restrictions can limit an S corporation’s growth potential and access to capital in some businesses. In others, however, an S corporation can be a key ingredient toward success.

What about regular corporations, known as C corporations? They do not have the shareholder restrictions that apply to S corporations, but they are subject to a double system of taxation. That is, their profits are subject to income tax at the corporate level, and are also taxed to the shareholders if distributed as dividends. But if profits are to be plowed back into the business to foster the company’s growth, the tax price is usually lower than with an S corporation. And there are many situations in which the double tax can be substantially minimized. An advantage to this form of operation is that shareholder-employees are entitled to tax-advantaged corporate-type fringe benefits, such as medical coverage, disability insurance and group-term life.

Besides the question of choosing a form of entity or accounting firm for your new business, there are many other tax decisions to be made, and much planning to ensure that you meet your income and payroll tax reporting and compliance chores properly. How will you handle your start-up costs? Will your workers be employees or independent contractors? Can you qualify for a home office deduction? Should you set up a qualified retirement plan, and, if so, what kind?

Please do not hesitate to call to set up an appointment for consultants services to explore these important matters further. With our experience, we can help you come to the right decisions and implement them quickly so that you can concentrate on the success of your new venture.

audit accountant

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