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Have you completed your company\u2019s year-end financial statements yet? Most calendar-year entities issue their year-end financials by March of the following year. Lenders and investors may think the worst if a company\u2019s financial reports aren\u2019t submitted in a timely manner. Here are three assumptions your stakeholders could make when your financial statements are late.<\/p>\n
1. Negative financial results <\/strong><\/p>\n No one wants to be the bearer of bad news. Deferred financial reporting can lead investors and lenders to presume that the company\u2019s performance has fallen below historical levels or what was forecast at the beginning of the year. Some companies also may procrastinate issuing financial statements if they\u2019re at risk for violating their lending covenants.<\/p>\n 2. Weak management<\/strong><\/p>\n Alternatively, stakeholders may assume that management is incompetent or disorganized and can\u2019t pull together the requisite data to finish the financials. For example, late financials may be common when a controller is inexperienced, the accounting department is understaffed or a major accounting rule change has gone into effect. Delays also may happen when external auditors and managers are at odds over adjusting journal entries \u2014 or when auditors are unwilling to issue an unqualified (clean) opinion or have going concern issues.<\/p>\n Delayed statements may also signal that management doesn\u2019t consider financial reporting a priority. This lackadaisical mindset implies that no one is monitoring financial performance throughout the year.<\/p>\n 3. Occupational fraud risks<\/strong><\/p>\n If financial statements aren\u2019t timely or prioritized by the company\u2019s owners, unscrupulous employees may see it as a golden opportunity to steal from the company. Fraud is more difficult to hide if you insist on timely financial statements and take the time to review them.<\/p>\n Don\u2019t procrastinate<\/strong><\/p>\n Late financial statements cost more than time; they can impair relations with lenders and investors. Timely financial statements foster goodwill with outside stakeholders. We can help you stay focused, work through complex reporting issues and communicate weaker-than-expected financial results in a positive, professional manner.<\/p>\n \u00a9 2024<\/em><\/p>\n <\/body> Have you completed your company\u2019s year-end financial statements yet? Most calendar-year entities issue their year-end financials by March of the following year. Lenders and investors may think the worst if a company\u2019s financial reports aren\u2019t submitted in a timely manner. Here are three assumptions your stakeholders could make when your financial statements are late. 1. […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13,7,10],"tags":[8,11,12],"class_list":["post-16854","post","type-post","status-publish","format-standard","hentry","category-aa","category-articles","category-news","tag-articles","tag-news","tag-updates"],"_links":{"self":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts\/16854","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/comments?post=16854"}],"version-history":[{"count":1,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts\/16854\/revisions"}],"predecessor-version":[{"id":16855,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts\/16854\/revisions\/16855"}],"wp:attachment":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/media?parent=16854"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/categories?post=16854"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/tags?post=16854"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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