Rocklin, CA Accountant for Real Estate Agents
It only takes one serious error with accounting to make a mess of your real estate business. Get help from our dedicated CPAs. Call today.
Stockholders, creditors, and private investors often need assurance that the financial statements accurately represent the true financial position of a company.
Your stockholders, creditors, or private investors have different levels of risk tolerance, so we provide three levels of assurance to meet your needs.
Audit – Highest Level of Assurance
An audit provides the highest level of assurance. An audit is a methodical review and objective examination of the financial statements, including the verification of specific information as determined by the auditor or as established by general practice.
Our work includes a review of internal controls, testing of selected transactions, and communication with third parties. Based on our findings, we issue a report on whether the financial statements are fairly stated and free of material misstatements.
An Audit allows you to…
- Satisfy stakeholders such as employees, customers, suppliers and pressure groups, as well as the investing community, as to the credibility of published information.
- Facilitate the payment of corporate tax, goods and services tax, and other taxes on-time and accurately, thereby avoiding interest, penalties, and investigations.
- Comply with banking covenants.
- Help deter and detect material fraud and error.
- Facilitate the purchase and sale of businesses.
Here’s what you get…
You get the highest level of assurance because we go outside your company to obtain more information. Typically, we’ll have written communication with:
- Your customers, to check outstanding receivable balances,
- Your banks, to confirm cash or debt balances and terms,
- Your vendors, to verify outstanding payable balances, and
- Your attorneys, for information on pending or threatened legal action.
We also perform physical inspections by observing your inventory counting methods and perform test counts. We document and test each operating cycle, including sales and cash receipts, expenses and cash disbursements, and payroll. Our audit papers include a detailed work program to document the examinations and testing performed, as well as the client’s supporting work papers.
Audits Not Just for Public Entities
All public companies are required to have an annual audit, but some nonpublic entities must undergo an annual audit as well. These include local governments, not-for-profit agencies and other organizations receiving government grants.
Moreover, some financial institutions require audits of nonpublic companies based on the financing amount and/or the bank’s assessment of the company’s risk. Also, companies with absentee ownership (such as those owned by investment firms, or individuals who no longer run the business) may order audits as checks of their management teams.
Review – Limited Assurance
Less extensive than an audit, but more involved than a compilation, a review engagement consists primarily of analytical procedures we apply to the financial statements, and various inquiries we make of your company’s management team. If the financial statements or supporting information appear inconsistent or otherwise questionable, we may need to perform additional procedures.
A review doesn’t require us to study and evaluate your company’s internal controls or verify data with third parties or physically inspect assets. Rather, a review report expresses limited assurance in the form of the statement: “We are not aware of any material modifications” for the financial statements to be in conformity with the Generally Accepted Accounting Principles (GAAP). Reviewed financial statements must include all required footnotes and other disclosures.
Why might a business request a review engagement? It can be a good middle ground, providing the advantages of a CPA’s technical expertise without the work and expense of an audit.
Compilation – Lowest Level of Assurance
In compiling financial statements for a client, we present information that is the “representation of management” and expresses no opinion or assurance on the statements. Compilations don’t require inquiries of management or analytical procedures. Instead, we rely on our knowledge of accounting principles and a general understanding of your business.
Banks often require compilations from an independent CPA as part of their lending covenants.
Which Report Should You Use?
Each type of financial statement report may suit specific circumstances, depending on requirements from your client’s bank or other parties, as well as meet budgetary needs.
Understanding each report’s unique strengths and weaknesses can help you choose the most appropriate one. Please call if you have questions about which type of report is right for you.
Operating in the real estate industry requires a person to remain sharp and abreast of a number of developments at one time. A serious error when handling accounting as a real estate agent can affect your business in a number of ways. Fortunately, real estate agents can greatly benefit by working with an accountant that understands the nature of the real estate industry. If you are a real estate agent in Rocklin, California, and you need accounting services for your business, you should speak with an experienced Rocklin accountant for real estate agents.
The Cook CPA Group understands the many obstacles faced by real estate agents, and we are here to provide you with the diligent accounting services that you deserve. Our accounting team possesses several years of combined accounting experience, and we would be pleased to use our experience to work with you. To schedule a free consultation to discuss accounting services for your real estate business, contact the Cook CPA Group at (916) 432-2218. You may also schedule your free consultation online.
Accounting Tips for Real Estate Agents in Rocklin, CA
The real estate industry presents a number of challenges, whether you are a real estate agent or you are involved with investing in real estate. Many challenges involving real estate have to do with financial and accounting matters. Fortunately, the Cook CPA Group is prepared to address your concerns regarding a variety of real estate accounting issues. The following are some accounting tips that can benefit a real estate agent in California.
Become Familiar with Real Estate Regulations
Real estate regulations in California are governed by a variety of state and local laws. Many of these laws can affect how a real estate agent might handle the financial management of their business. Failure to understand local and state regulations can lead to a number of accounting issues. The skilled CPAs at our firm our ready to work with you to ensure you are compliant with California’s real estate regulations.
Choose an Accounting Method
Another important part of operating as a real estate agent is to ensure that you select an accounting method that works for your business. There are two types of accounting methods that you can choose from for your real estate business: cash basis method or accrual method.
The cash basis of accounting requires that a company recognize revenue when it is received or when it is paid out. Alternatively, the accrual method of accounting permits a company to recognize income when the revenue is earned and expenses are recorded when liabilities are incurred.
Keep Thorough Records
It is also vital for a real estate agent to keep thorough records of their financial transactions. For example, you should have a record of expenses and income for the company.
Ensure Business and Personal Assets are Separate
A real estate agent should also be sure to avoid the commingling of personal and business assets. For instance, using a business credit card to make a personal purchase can lead to a number of accounting problems. Opening a dedicated bank account for your business can help you avoid the commingling of assets.
If you engage in the mixing of personal and business assets, this could result in errors when calculating company expenses, which could, in turn, lead to a tax audit.
Manage Your Payroll Taxes
Whether you employ workers on a salary or a commission, it is vital to ensure you calculate payroll taxes. While you can use payroll software to resolve this accounting matter, it may be more prudent to work with an experienced California CPA.
The Cook CPA Group welcomes the opportunity to discuss how our accounting team could assist you efficiently operating your real estate business.
How a Rocklin Accountant Can Assist Your Real Estate Business
There are a number of reasons that you should consider hiring an experienced California accountant for your real estate business. An experienced accountant will be able to offer you guidance on a number of issues. Our experienced CPAs understand the intricate laws of the real estate industry, and we are capable of helping you manage multiple financial issues that may affect your business.
One way that your firm can assist you is by providing you with accounting services to file your tax returns. We can help ensure that your small business tax returns and your payroll taxes are timely filed. Failure to timely file taxes in California can lead to a number of legal problems. For example, you may be assessed multiple late fees, or you could be subjected to a tax lien under extreme circumstances.
Additionally, our real estate CPAs can provide the following services:
- Strategic business planning
- Financial statement audits
- Internal controls
- Small business accounting
- Corporate tax preparation
This is not an exhaustive list. You should waste no time in speaking with our accounting team today.
Contact Our Experienced Rocklin, CA Real Estate Accountants Today
If you need accounting help for your real estate business, contact an experienced Sacramento accountant for real estate agents. The Cook CPA Group is here to assist you if you are having difficulty managing your real estate finances. You may also contact our skilled team of accountants online to schedule your free consultation today.