Case Study: CFO Advisory Team Brings Best Practices and Financial Clarity

CFO Advisory Services | Robert O. Mayer | Nov 09, 2021

Our CFO Advisory experts were introduced to a company, which will remain anonymous, because the company needed financial statement services so it could present a picture of its entire operation to a potential acquiring company. The deeper our team analyzed the company’s financial and tax history, the more apparent it became that the company was in need of a broader scope of services. 

“A More Proactive, Progressive Approach” 

Instead of having one financial statement, the company had three separate financials prepared by a sole practitioner CPA with whom the company had been working with for many years. The company did not show elimination entries or other adjusting entries that are required to reflect a single entity, which is what the company was trying to market to the acquisition target. 

This was the first sign that the company needed to make the transition from an individual CPA to an accounting firm with a wider range of expertise.  Their accountant had been preparing financial statements on an annual basis that were not up to current accounting standards. The company needed a more proactive, progressive approach. 

The CFO Advisory team prepared the company’s financials in a manner that enabled them to properly present them to the potential acquiring company. They obtained intracompany transactions and other eliminating entries that needed to be reflected and generated a financial statement that projected the company’s best image. In this case, a balance sheet and P&L were required to reflect the company’s financial condition for the potential acquisition. 

The company was in a much stronger, more confident position. In fact, leadership eventually walked away from the deal when the acquiring entity said they needed to change the terms.  

Assisting in Other Areas of the Company 

At this point, the company asked how Prager Metis could help in other areas of the business. The company’s bank sent a notification requesting that Prager Metis prepare financial statements on a consolidated basis, which the prior CPA had not done. 

The CFO Advisory team referred them to the SALT (state and local tax) team to review how the company was handling sales tax. Because of the ruling in the 2018 Wayfair case, which found that sales tax for online purchases must be considered and reported based on each state’s guidelines, the SALT team reviewed the company’s entire operation for a three-year period. 

We got them caught up with sales tax, negotiated down penalties, and paid interest to bring them to a state of compliance.  Prager Metis is now handling the company’s sales tax moving forward. 

The CFO Advisory team also performed a review of the company’s tax returns and found that they hadn’t been making the best possible use of depreciation. The tax returns also showed that stock had been passed down to the two company owners from their mother through a trust as part of estate planning.  

The former CPA claimed to know nothing about this, so Prager Metis is investigating to determine if returns were filed and reviewing the estate planning strategy to determine if it should be amended to maximize the family’s tax benefit. Prager Metis has also taken over all corporate and individual tax returns. 

Moving Forward with Compliance and Clarity 

Initially, the Prager Metis CFO Advisory team was brought in to assist with a potential acquisition, but this quickly evolved and expanded into broader services. CFO Advisory Services include ongoing consultations with the company’s controller for year-end closing, schedules for tax returns, and insuring  other accounting functions are handled properly. 

We can now implement best practices across the organization and provide the services necessary for the business to grow.  If we uncover other issues, we can address them as they arise to ensure compliance and financial clarity. Overall, the company is in a much stronger position from an accounting perspective and well-positioned for the future. 

For more information on Prager Metis’ CFO Advisory Services and the benefits and value these services can bring to your organization, please contact 


Top Ten Year-End Tax Planning Checklist

As the year draws to a close, taking proactive steps in your financial planning can significantly impact your tax liability. This checklist provides a guide to key strategies that individuals can consider before the end of the year to potentially decrease their income tax. By strategically managing income, deductions, and investments, you can optimize your tax situation and position yourself for a more tax-efficient financial future.

Read More »