Tax-Related Services The entrepreneur often doesn’t realize that tax planning is a source of business capital. Careful planning and the use of a CPA can enhance this source of funds. Income taxes must be paid on business profits; hence, they are expenses of a business. These income taxes, if properly planned, can be kept to a minimum, thus leaving cash available for financing your business. In addition, if a business should fail, you will want the most advantageous treatment of these losses. The CPA must always be aware of current changes in the tax law and can provide the proper vehicle for making the most of this source of funds. For example, the CPA can: assist in structuring the initial organization of proprietorships, partnerships (whether general, limited or limited liability) or corporations; assist in structuring a possible tax-free incorporation; assist in structuring business purchase, sale or liquidation transactions; prepare various compliance tax reports, such as individual, partnership and corporate income tax, payroll, sales tax, property taxes; handle tax examinations and tax planning strategies; assist in estate planning and personal tax planning; and assist in the implementation of executive compensation, retirement plans and employee benefit programs.
Financial Planning and Consulting Services A CPA can assist a business:
• in choosing the form of business organization • setting up an accounting system and procedures
• defining and obtaining reporting, operational and cost control needs • developing and evaluating the business plan, forecasts and budgets
• strategic planning; preparing special purpose reports including statements prepared on comprehensive bases of accounting other than generally accepted accounting principles • preparing reports with opinion on specific financial statement elements such as accounts receivable and inventory reports • discussing results of applying agreed-upon procedures to specific financial statement elements; implementing cash flow and management reports • structuring and implementing financing plans for the start-up, operation, and expansion stages • preparing reports to management on the strengths and weaknesses of internal accounting controls along with recommendations to correct the weaknesses • preparing bank loan applications for initial or expansion capital needs • computer selection, implementation and training; • providing advice on business valuations and mergers and acquisitions. The Minnesota Society of Certified Public Accountants maintains a free referral service to put businesses in contact with qualified CPAs. Contact the MNCPA at the telephone number listed in the Resource Directory section of this Guide.
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