Many organizations are forming relationships with third parties to perform key business functions for a variety of reasons, including to help reduce costs, increase revenues or share business risks. But commercial relationships can be risky from an internal control and financial perspective, and thus can raise corporate governance and financial reporting issues.Indeed, based on KPMG LLP's research, at least 70 percent of reporting by business partners is incorrect. The reasons for misreporting may vary - misunderstandings, mistakes and occasionally fraud - but they all have a direct impact on the bottom line.
CPAs can provide value to organizations by understanding the risks involved in different kinds of commercial relationships. In addition, CPAs can help evaluate and improve the effectiveness of organizations' efforts to manage contract risks through contract compliance monitoring activities.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access