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Tax prep question
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jakescia
Posted 3/26/2020 11:45 (#8140287 - in reply to #8139997)
Subject: RE: Tax prep question



Oskaloosa, Iowa 52577

Lots of factors in a billing.

Examples...........

Most people, especially with quickbooks, do not comprehend the controls they should be using in order to provide relatively accurate numbers.  All too many believe they can pull a list of amounts from whatever they believe are their "books", and a solid return can be done from that.  So.................

1.  We will not sign a return unless we have "substantial belief" that the cash account per books reflects the bank statements.  One primary reason is that if the cash accounts tie together, and the books balance, then the amounts in the books may be in the wrong accounts, but at least there is a large probability that they are stated properly.

2.  Once the cash accounts tie, then a good general ledger (and that means as prepared by the bookkeeper, and has little to do with the software one is using) can be "...read like a book."  If each transactions carries a good description, then one can quickly scan the accounts, and get a "feel" for the adequacy of the reporting.  Adjusting entries are made then to bring the books into proper presentations, for historic purposes.

3.  After that..........ie the adjusting entries..........including those for depreciation...........then the books can be summarized into "financial statements".......and every software has their own version of such a "listing of accounts".

4.  Those "listings" can then be the source of the numbers for the returns.

If any step above is not done...........then the adequacy of the "books", as support for the tax return, fails.

The clients should be able to handle steps 1 and 2.........and if done properly, all of the following steps are nominal in terms of time, but astronomical in terms of importance.

2100 seems to be a little high..........but that assumes that the general ledger is not a friggin' mess, and ties to the bank statements.

1500 seems to be about right.

I used to quote 750 for a corporate return, assuming 1 and 2 were tight.  I soon found that "bank reconciliation" is a foreign term to most............and getting the two to agree could easily take 3-5 hours.........300---500.


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