A biotechnology firm that’s working on world-changing, innovative research and development needs an accounting plan designed for this highly-specified industry. Complex transactions are the norm in this industry. Things like licensee agreements, research agreements, development arrangements and share-based payments are common. Most biotech firms can benefit immensely from bringing in a biotechnology financial advisor to help formulate an accounting strategy that accounts for all of these moving parts. Let’s look at some of the specific areas to consider when building a comprehensive plan for biotechnology bioprocessing and business management.
Biotechnology Bioprocessing and Business Managementat a Glance
Revenue recognition is a topic with which every biotechnology CPA is familiar. Biotech firms must comply with strict standards regarding revenue generated from customer contracts. Consistent, accountable documentation is essential in these cases.
Another factor that biotech firms encounter is frequent consolidation. This is an accounting issue that’s pretty unique to the biotech world, as firms are continually entering into arrangements to share research, development data and intellectual property. All of this movement of ownership and assets may need to be addressed through biotechnology tax planning and bookkeeping. It’s possible that using flexible, cloud-based software could help to streamline the processes behind tracking and monitoring these changes.
The Roles of Forecasting and Budgeting
Because biotechnology is often a project-based industry, accounting tends to emphasize forecasting and budgeting. It may be necessary for some firms to have accurate predictions in place to keep projects moving along. As a result, biotechnology bookkeeping strategies may need to focus on creating very reliable, timely cash-flow management. Cash-flow allocation may also be an essential aspect of biotechnology accounting because unnecessarily holding on to capital could hinder projects. Conversely, depleting cash reserves before securing the next round of funding could be devastating.
Some Considerations for Biotechnology Bioprocessing and Business Management
Biotechnology bioprocessing and business management may vary wildly by the company. This discrepancy is because various credits and tax codes can apply depending on your firm’s specific area of research. Additionally, tax planning is often complicated by things like partnerships and mergers. For biotechnology startups, it’s critical to understand potential research and development credits, payroll credits and other tax incentives.
Working With a Biotechnology Financial Advisor
Having a solid baseline when formulating an accounting strategy for a biotechnology startup firm may be easier if you bring in biotechnology bioprocessing and business management services. Fusion CPA offers accounting, bookkeeping, tax planning and biotechnology CFO business advisory services for firms and startups of all sizes. We may be able to help your biotech company optimize cash-flow management by introducing just a few changes. Also, we’ll explore options that may help your company maximize the unique tax incentives available in your sector. Our services may even prove useful if you have a full-time biotechnology CPA because we can bring in a strategic, fresh outside perspective. We’re dedicated to helping you make the most of the capital you have available to fund projects today while also looking ahead at capital allocation for future growth. You can learn more about our services by clicking the button below to schedule a complimentary discovery call today!
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