Basic accounting for computer software engineering firms includes keeping track of bookkeeping, basic tax planning, payroll, and monitoring income and expenses. This standard financial accounting is key for the health and well-being of your business.
However, accounting for computer software engineering firms must also be addressed at the project level. Project accounting helps make sure that your individual projects are handled successfully.
Understanding The Differences Between Project Accounting & Standard Accounting
The major difference between standard accounting and project accounting is the time frame. A CPA for computer software engineering firms may review the finances of your firm on a monthly or quarterly basis. However, individual projects may be over in less time than that. For this reason, you need to take the pulse of your profits and losses, earned value, and utilization margins on a more frequent basis.
When you handle bookkeeping for computer software engineering firms on this micro-level, you are able to monitor things in real-time instead of after-the-fact. This way, you have more control over small decisions, which will affect larger decisions.
Use Project Accounting To Increase Efficiency & Profits
At the heart of accounting and bookkeeping for computer software engineering firms is a desire to improve efficiency and profits. When your firm tracks data on a project level, you are able to identify and make the best use of sources of profit and financial problems and then resolve them quickly.
In addition to looking at your finances on a global scale, a CPA for computer software engineering firms may be able to examine your accounts on a project basis. This can provide you with insights on the highest performing employees, what products or projects your firm should focus more time on, and how minute changes are impacting larger accounting trends in your firm.
What Is Involved In Tax Planning For Computer Software Engineering Firms?
Computer software engineering firms tend to accumulate earnings over time as opposed to maximizing current salaries.When engaging in tax planning for computer software engineering firms, accountants consider how The Tax Cuts and Jobs Act will affect taxation for engineering firms. Here are some of the major things our accountants here are at Fusion CPA take note of:
• On the positive side, the corporate tax rate dropped from 35 to a max of 21 percent.
• Some deductions that engineers could take in the past have been removed. This means that some firms and some individuals may see an increase in their federal income taxes.
• Revenue code section 199A offers a special deduction for some sole proprietors, partners, and owners of S corporations.
Based on this information, it may be beneficial to change your firm’s legal status to get the most out of current tax benefits
Navigating Your Firm With Experts
At Fusion CPA, we make it our goal to stay up-to-date with changes in the tax laws that can impact your firms’ health, for the better or worse. Part of the services we offer our clients includes tax preparation, accounting and bookkeeping for software engineering firms, and financial advice for the future. We are familiar with a variety of high-quality accounting platforms and software and our goal is to help you and your engineering firm make the most of every financial opportunity. We also offer CFO advisory for computer software engineering firms in Atlanta, Georgia, and throughout the country. You can learn more about our services by clicking the button below to schedule a complimentary discovery call today!
This blog article is not intended to be the rendering of legal, accounting, tax advice or other professional services. Articles are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes. We expressly disclaim all liability in regard to actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.