Client Transitioned From Cash Basis Accounting to Accrual Basis Through BGSF
Our client is an S Corp and maintains its financial records on the cash basis of accounting. They have historically presented audited cash basis statements to banks, investors and other interested parties. Professional services firms moved away from cash-based financial statements to promote comparability with other financial statement issuers, and our client decides to restate its prior year’s financial statements to accrual basis in accordance with GAAP.
Our team of Consultants worked directly with the client to develop a timeline for transitioning from Cash Basis Accounting to Accrual Basis.
Identify the significant accounting processes and groups of accounts and identify which accounts should be reviewed for accrual entries.
Gather supporting documentation for accrual entries and book journal entries; work closely with project managers to create a percentage of completion estimates for ongoing projects; create a process for the cost accumulation and overhead distribution to the WIP.
Prepare financial statements and supporting footnotes for audit; assist the auditors in the audit.
Clients Return on Investment:
Our client did not have the bandwidth to analyze and restate their financials as their bankers, investors, and others had requested. Our consultants quickly scoped the project, identified the resources needed and executed the assignment with minimal disruption to the accounting team. The consultant also implemented a tool for capturing cost by the project and to allocate overhead.