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Audit approach overview
Our audit approach will allow our client's accounting personnel to make the maximum contribution to the audit effort without compromising their ongoing responsibilities
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Annual and short period audit
At P&A Grant Thornton, we provide annual and short period financial statement audit services that go beyond the normal expectations of our clients. We believe strongly that our best work comes from combining outstanding technical expertise, knowledge and ability with exceptional client-focused service.
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Review engagement
A review involves limited investigation with a narrower scope than an audit, and is undertaken for the purpose of providing limited assurance that the management’s representations are in accordance with identified financial reporting standards. Our professionals recognize that in order to conduct a quality financial statement review, it is important to look beyond the accounting entries to the underlying activities and operations that give rise to them.
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Other Related Services
We make it a point to keep our clients abreast of the developments and updates relating to the growing complexities in the accounting world. We offer seminars and trainings on audit- and tax-related matters, such as updates on Accounting Standards, new pronouncements and Bureau of Internal Revenue (BIR) issuances, as well as other developments that affect our clients’ businesses.
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Tax advisory
With our knowledge of tax laws and audit procedures, we help safeguard the substantive and procedural rights of taxpayers and prevent unwarranted assessments.
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Tax compliance
We aim to minimize the impact of taxation, enabling you to maximize your potential savings and to expand your business.
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Corporate services
For clients that want to do business in the Philippines, we assist in determining the appropriate and tax-efficient operating business or investment vehicle and structure to address the objectives of the investor, as well as related incorporation issues.
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Tax education and advocacy
Our advocacy work focuses on clarifying the interpretation of laws and regulations, suggesting measures to increasingly ease tax compliance, and protecting taxpayer’s rights.
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Business risk services
Our business risk services cover a wide range of solutions that assist you in identifying, addressing and monitoring risks in your business. Such solutions include external quality assessments of your Internal Audit activities' conformance with standards as well as evaluating its readiness for such an external assessment.
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Business consulting services
Our business consulting services are aimed at addressing concerns in your operations, processes and systems. Using our extensive knowledge of various industries, we can take a close look at your business processes as we create solutions that can help you mitigate risks to meet your objectives, promote efficiency, and beef up controls.
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Transaction services
Transaction advisory includes all of our services specifically directed at assisting in investment, mergers and acquisitions, and financing transactions between and among businesses, lenders and governments. Such services include, among others, due diligence reviews, project feasibility studies, financial modelling, model audits and valuation.
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Forensic advisory
Our forensic advisory services include assessing your vulnerability to fraud and identifying fraud risk factors, and recommending practical solutions to eliminate the gaps. We also provide investigative services to detect and quantify fraud and corruption and to trace assets and data that may have been lost in a fraud event.
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Cyber advisory
Our focus is to help you identify and manage the cyber risks you might be facing within your organization. Our team can provide detailed, actionable insight that incorporates industry best practices and standards to strengthen your cybersecurity position and help you make informed decisions.
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ProActive Hotline
Providing support in preventing and detecting fraud by creating a safe and secure whistleblowing system to promote integrity and honesty in the organisation.
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Accounting services
At P&A Grant Thornton, we handle accounting services for several companies from a wide range of industries. Our approach is highly flexible. You may opt to outsource all your accounting functions, or pass on to us choice activities.
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Staff augmentation services
We offer Staff Augmentation services where our staff, under the direction and supervision of the company’s officers, perform accounting and accounting-related work.
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Payroll Processing
Payroll processing services are provided by P&A Grant Thornton Outsourcing Inc. More and more companies are beginning to realize the benefits of outsourcing their noncore activities, and the first to be outsourced is usually the payroll function. Payroll is easy to carve out from the rest of the business since it is usually independent of the other activities or functions within the Accounting Department.
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Our values
Grant Thornton prides itself on being a values-driven organisation and we have more than 38,500 people in over 130 countries who are passionately committed to these values.
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Global culture
Our people tell us that our global culture is one of the biggest attractions of a career with Grant Thornton.
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Learning & development
At Grant Thornton we believe learning and development opportunities allow you to perform at your best every day. And when you are at your best, we are the best at serving our clients
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Global talent mobility
One of the biggest attractions of a career with Grant Thornton is the opportunity to work on cross-border projects all over the world.
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Diversity
Diversity helps us meet the demands of a changing world. We value the fact that our people come from all walks of life and that this diversity of experience and perspective makes our organisation stronger as a result.
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In the community
Many Grant Thornton member firms provide a range of inspirational and generous services to the communities they serve.
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Behind the Numbers: People of P&A Grant Thornton
Discover the inspiring stories of the individuals who make up our vibrant community. From seasoned veterans to fresh faces, the Purple Tribe is a diverse team united by a shared passion.
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Fresh Graduates
Fresh Graduates
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Students
Whether you are starting your career as a graduate or school leaver, P&A Grant Thornton can give you a flying start. We are ambitious. Take the fact that we’re the world’s fastest-growing global accountancy organisation. For our people, that means access to a global organisation and the chance to collaborate with more than 40,000 colleagues around the world. And potentially work in different countries and experience other cultures.
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Experienced hires
P&A Grant Thornton offers something you can't find anywhere else. This is the opportunity to develop your ideas and thinking while having your efforts recognised from day one. We value the skills and knowledge you bring to Grant Thornton as an experienced professional and look forward to supporting you as you grow you career with our organisation.
Over the past three months, I have attended numerous meetings with clients to discuss audit results and the audited financial statements that needed to be finalized in time for the statutory filing deadline. During such meetings, the discussion would normally revolve around the client’s financial statements, particularly on the company’s financial performance, which is the first thing the client examines.
I have yet to encounter a client that inquired or even looked seriously at the cash flow statements. I, myself, would have to admit to giving less focus on the cash flow statements. When we perform our audit, we prioritize the examination of items in the statement of financial position: the assets, liabilities and equity of the company.
This pattern makes me think about whether the cash flow statement is still relevant to business owners. Aside from the financial reporting standards’ requirement to submit cash flow statements, does it provide other value?
Is the cash flow statement really inferior to other financial statements? Aside from making the financial statements a page thicker, how does the cash flow statement help business owners analyze and understand their organization better? Is it possible that business owners do not see the importance of cash flow statements, because they do not have a clear picture of what it conveys?
The cash flow statement is a critical and integral part of the financial statements, as it tells business owners how much cash the business generates. The profit or loss statement is also important, as it indicates whether a company generates a profit. I once encountered a client asking why their company had no cash despite the profits earned. This is where the role of the cash flow statement comes into play, as it supplements the information provided in the profit or loss statement.
The financial statements are based on accrual accounting, which takes into account non-cash income and expenses to best reflect the financial health of a company. The use of accrual accounting, however, creates accounting noise; it is influenced by the management’s choice of accounting policies, judgements and estimates.
The cash flow statement tunes out these management choices and clearly delineates how much actual cash a company generates. In terms of the reliability of the balances, the cash flow statement allows little room for manipulation, unlike reported earnings. Unless tainted by fraud, this statement tells the whole story of cash flow: either the entity has cash or it does not.
The cash flow statement is classified into three sections: cash flow from operations, cash flow from investing, and cash flow from financing. The net cash flow (the change in cash and cash equivalents during the period) shares little information in itself; it is the classification and individual components that provide the information.
Cash flow from operating activities measures the amount of cash generated or used by a company as a result of producing or selling goods and services. Although negative cash flow from operations is expected in some circumstances (e.g., rapid growth), positive cash flows from operations are essential for long-term survival.
Cash flow from investing activities normally reflects cash outflows used for capital expenditures, business acquisitions, and investments. For an owner, capital expenditure (capex) is the most important item as this is necessary to support a company’s efficient operations and competitiveness. Lastly, cash flow from financing is dominated by debt and equity transactions. This provides information about the type of financing used to support the company’s operations and investing activities, any returns provided to stockholders (dividends or repurchase of shares), and repayment of debt.
Owners can use the cash flow statement to know where the money went and where it came from. A company could have a reasonably good profit, but the unmonitored amount of money being used to pay off its debts could put it out of business. An entity’s use of cash to build up inventories, finance capital expenditures and extend credit to customers are not visible in the profit-or-loss statement. The profit-or-loss statement could reflect good profits camouflaging the underlying problem of cash deficiency and liquidity, especially if the owner’s focus is solely directed at the bottom line.
Cash flow is relatively (but not completely) free of the drawbacks of the accrual concept; it is less likely to be affected by variations in accounting principles and estimates, making it more useful than the reported income in assessing liquidity and solvency. The cash flow statement can also help business owners make financing and investing decisions. When owners decide on the best approach to grow the business, they can use the cash flow statement to decide how to fund their growth. Owners can opt to fund their growth through operations—if the company generates enough cash flow from operations—finance it through debt or equity, or both.
The cash flow statement helps predict an entity’s ability to sustain (and increase) cash flow from operations, making it a valuable measure of a company’s strength, profitability, and the long-term outlook.
It can also help determine whether a company is liquid enough to sustain its operations. Organizations can also
use a cash flow statement to predict future cash flows, making it an essential budgeting tool. Owners should not disregard the information in the cash flow statement and should seriously use it to their advantage.
I look forward to the day when in the course of a meeting with clients, someone would ask about the items in their cash flow statements.
Boyet Murcia III is a partner of Audit & Assurance of P&A Grant Thornton, one of the leading audit, tax, advisory and outsourcing firms in the Philippines, with 21 partners and over 900 staff members. We’d like to hear from you! Tweet us: @PAGrantThornton, like us on Facebook: P&A Grant Thornton, and email your comments to boyet.murcia@ph.gt.com or pagrantthornton.marketscomm@ph.gt.com. For more information, visit our website: www.grantthornton.com.ph.
As published in The Manila Times, dated 25 April 2018