According to reports from U.S. Bank, SCORE, B2B Reviews, and Skynova, a whopping 82% of SMBs
fail due to poor bookkeeping and cash-flow analysis.
We see this every day.
Our Client Advisory Services finds errors in 80% to 90% of our tax clients’ books (many are
egregious).
The Bottom Line:
If your Balance Sheet is not properly reconciled, there is a 100% chance your financial
statements are off and your tax return is incorrect.
We promise 100% accuracy in the preparation and review of financial statements. This is
why we offer Audit Insurance.
Ensuring accuracy in Financial Statements:
- Located missed or omitted deductions
- Greatly reduces or eliminates Audit Fail Risk
- Optimizes tax Strategies
Why reconcile monthly?
It reduces internal fraud risk – here’s proof:
Case 1:
Business operating for 20+ years with multiple partners.
Invited to audit the books, we found one of the partners had been siphoning funds through
multiple shell companies for two decades. Already found a total of $15 million has been
skimmed over that time and expect to find more once discovery requests are received . This
is now a civil court case and potentially will turn into a criminal one.
Case 2:
A company with issues reconciling its books brought us in. In short order, we discovered one
of the partners had set-up a mirror corporation competing with this one – nearly driving it
out of business. Our investigation revealed the entire operation and our client was awarded
the whole mirror corporation and forced the partner to relinquish all his equity as a result.
Case 3:
A Prosperity tax strategy client signed up for our advisory service: Father & Son business.
Senior and Junior had the same name but different accountants for their respective portions
of the business. We discovered that neither CPA differentiated the W2 income for the other
‘partner’ – meaning the Father’s return included his son’s income and vice versa. Decoupling this resulted in re-filing past tax returns, netting our client a massive windfall.
There are multiple reasons why a second set of eyes combined with monthly reconciling of
your books can help any business. It:
- Minimizes errors
- Maximizes deductions
- Course corrects current and past tax returns
- Detects internal fraud early
- Vets a potential purchase
- Polices an exit strategy
Some examples of the types of issues we’ve found:
- Duplicate vendor payments – over-paid by 2x.
- Five months of advance loan payments totaling more than $130,000 (client had no idea they’d overpaid)
- Improperly reconciled note resulting in loss of interest deduction
- Failure to charge sales tax: client faced a bill for $830,000, we reduced to $34,000
Prosperity Tax Advisors offers clients a holistic approach to maximize financial positions:
- Client Advisory Services gain a deep understanding of your historical tax position and
current situation - The Strategy Team creates custom-curated tax strategies tailored to meet your need in
that financial year (which can change over time)- Substantiates the strategies to streamline filing and reduce or eliminate Audit Risk
- Our CPA team can file for you or work with your tax prep and filing service to ensure
your return meets IRS specs
We turn your tax liability into investment strategies. Could your books use a second set of
eyes? Reach out today!