Our accounting, tax, audit, assurance, and consulting teams are well-versed in manufacturing. With an integrated service approach, we ensure advisory services are relevant and adaptable to each client’s business and market. Focused on increasing profits, we help manage working capital and develop strategies to reduce taxes. Also, we provide development application methods for manufacturing and non-manufacturing to manage overhead and evaluate costs. Sometimes, we may offer recommendations for alternative accounting and business strategies.
Manufacturing companies rely on efficient productivity and product specialization for profitability. Although labor productivity increased with computer systems, U.S. costs remain high, and many manufacturers continue to move production operations to lower-cost countries.
Almost all aspects of U.S. manufacturing are now automated. Manufacturing was the leading industry to use applications such as enterprise resource planning (ERP) and enterprise services architecture (ESA). Annually, U.S. manufacturers spend approximately $6 billion for computer equipment. These technologies streamline business processes and reduce labor hours.
Fewer manufacturers produce items from raw materials to finished goods. As a result, most manufacturers make products for other manufacturers. To minimize investment in materials inventory, companies practice some form of just-in-time, or lean, manufacturing. This process requires carefully coordinating deliveries from suppliers to reduce raw materials inventory and coordinating deliveries to customers to minimize finished goods inventory.
Regulation and Finance
Manufacturing faces many finance and regulation challenges. The sector is capital-intensive requiring large investments in plants and equipment. Many operations produce hazardous byproducts and EPA regulations are strict with large fines. Other regulators such as OSHA and the Labor Department impact employee-related issues.
We help clients reduce income and sales taxes through:
+ Maximizing Production Deduction.
+ Minimizing general and administration overhead computation.
+ Eliminating sales tax on energy and capital investment tax credits.
+ Research and development (R&D) tax credits.
+ Decreasing sales tax paid on certain equipment and supplies.
Audit processes are specific to manufacturing and may include:
+ Financial statements.
Collaborating with management, we evaluate and develop improvements in:
+ Product costing.
+ Practical overhead and labor application.
+ Bill of materials.
+ Product profitability contribution.
+ Process or job costing techniques.
+ Standard costing, including price and usage variances.
For questions regarding manufacturing, contact one of our team members.
Anthony J. Plese, CPA
Mark R. Dreher, CPA
Stephen J. Rodis, CPA
J. Douglas Bishop, CPA