Inventory Fraud

Knowledge Is Your First Line of Defense

Inventory is one of the biggest assets on a manufacturer’s balance sheet. It’s also one of the hardest assets to measure and track. Thousands of transactions flow through the inventory account each year—and many of these journal entries require subjective estimates, such as overhead allocations, write-offs, and valuation adjustments. In addition, many employees have direct daily access to inventory or inventory accounting records, providing an ongoing temptation to steal or cook the books.

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Topics: Manufacturing & Distribution

Using an IC-DISC to Lower Taxes

Manufacturers and distributors who export products should consider the use of an interest charge domestic international sales corporation (“IC-DISC”) to reduce their tax burden. Here are some frequently asked questions about this strategy.

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Topics: Manufacturing & Distribution

Wage Increases: Look before You Leap

Posted by Dawn Möeder, CPA of England and Wales on Apr 4, 2016

A recent Gallup poll shows that roughly three-quarters of Americans support a minimum wage increase. Factories and warehouses tend to employ a large number of entry-level and low-wage workers. So you may be considering a wage increase for your hourly workers. Here are some important questions to factor into your decision.

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Topics: Manufacturing & Distribution, Accounting Tips

Why Deal Structure Counts

Posted by Matt Peck, CPA, Partner, Tax Services on Apr 4, 2016

Comparing and Contrasting Asset and Stock Deals

The merger and acquisition market is picking up along with the performance of the manufacturing sector. Today’s market is generally more seller-friendly than during the recession, when buyers were primarily trolling for distressed companies. Healthy, profitable companies can typically sell at higher pricing multiples today than five years ago, which means sellers don’t necessarily have to concede to their buyers’ every demand.

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Topics: Manufacturing & Distribution, Accounting Tips

Are You Aware Of Your State and Local Tax Liabilities?

Does your company operate in multiple states? If so, you may owe state and local taxes to some of those states, even if you do not realize it. While it may be difficult to determine whether your activity in other states triggers a tax liability, ignorance is no defense, and the penalties for noncompliance can be steep, making this a critical issue for small businesses.

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Topics: Manufacturing & Distribution, Accounting Tips

Manufacturers’ Deduction

Posted by lgtcpa on Aug 4, 2015

The manufacturers’ deduction, also called the “Section 199” or “domestic production activities deduction,” is 9% of the lesser of qualified production activities income or taxable income. The deduction is also limited to 50% of W-2 wages paid by the taxpayer that are allocable to domestic production gross receipts.

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Topics: Manufacturing & Distribution, Accounting Tips, Tax

ASU Exposure Draft: Simplifying the Subsequent Measurement of Inventory

As the Financial Accounting Standard Board (FASB) continues their focus on simplification, the Board voted in May of this year to finalize Simplifications on Subsequent Measurement of Inventory. The Board’s inventory measurement simplification objective is to reduce the cost and complexity of the subsequent measurement of inventory while maintaining, or improving, the usefulness of the information being reported.

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Topics: Manufacturing & Distribution, Accounting Tips

Revolutionizing Manufacturing Materials

Posted by lgtcpa on Jun 10, 2014

New materials are constantly being created in order to keep up with our ever changing environment, economy and high-tech industries.

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Topics: Manufacturing & Distribution