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Every company has at least one owner. And in many cases, leadership exists down through the organizational chart. But not every business has strong governance. In a nutshell, governance is the set of rules, practices and processes by which a company is directed and controlled. Strengthening it can help ensure productivity, reduce legal risks and,…
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Many nonprofit youth sports leagues are at risk for fraud and don’t even know it. Because cash transactions are common and leagues usually are managed by volunteers with little oversight, it’s easy for individuals with ill-intentions to take advantage. Unfortunately, sports league fraud is usually committed by board members or officers who are well known…
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When companies reissue prior financial statements, it raises a red flag to investors and lenders. But not all restatements are bad news. Some result from an honest mistake or misinterpretation of an accounting standard, rather than from incompetence or fraud. Here’s a closer look at restatements and how external auditors can help a company’s management…
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Income and losses from investment real estate or rental property are passive by definition — unless you’re a real estate professional. Why does this matter? Passive income may be subject to the 3.8% net investment income tax (NIIT), and passive losses generally are deductible only against passive income, with the excess being carried forward. Of…
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Think the rules for reporting employee stock options and restricted stock are too complicated? The Financial Accounting Standards Board (FASB) agrees — and it has simplified the rules starting in 2017 for public companies and 2018 for private companies. Here’s how: Old rules Under current U.S. Generally Accepted Accounting Principles (GAAP), for each share-based payment,…
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When it comes time to transition your role as business owner to someone else, you’ll face many changes. One of them is becoming a mentor. You’ll have to communicate clearly, show some patience and have a clear idea of what you want to accomplish before stepping down. Here are some tips on putting your successor…
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Every nonprofit organization needs a comprehensive succession plan to ensure smooth leadership transitions. Here are five tips for making a written plan successful: 1. Look within. It’s important to develop employees who can move up the ladder when an executive director or other senior manager leaves. But don’t rule out hiring an outsider. Promoting from…
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By midyear, most businesses that follow U.S. Generally Accepted Accounting Principles (GAAP) have issued their year-end financial statements. But how many have actually used them to improve their business operations in the future? Producing financial statements is more than a matter of compliance — owners and managers can use them to analyze performance and find…
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Debt is an integral part of many for-profit companies’ strategic plans, yet it has traditionally carried a stigma in the nonprofit world. That view is changing, as more organizations borrow money for major capital purchases, new program funding and other reasons. But before your nonprofit borrows, it’s important to understand that it takes prudent financial…
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Adequate insurance coverage is, in many cases, a legal requirement for a business. Even if it’s not for your company, proper coverage remains a risk management imperative. But that doesn’t mean you have to take high insurance costs sitting down. There are a wide variety of ways you can decrease insurance costs. Two examples are…
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