Follow Ryan Linkedin Facebook
Email Ryan Email
Financial
Mar 12, 2019

Commitments and Contingencies

Sponsored Content provided by Ryan Skuce - Partner, Earney & Company, LLP

Financial statements provide a picture, a snapshot, of the state of your organization at one point in time – generally your fiscal year end – and how well you managed your funds over that fiscal year.
 
But that doesn’t complete the picture.
 
It is also important to inform the readers of your financial statements – your grantors, your lenders, your members and donors – about the future of your organization, in particular the financial implications of, you guessed it – commitments and contingencies.
 
Commitments are those obligations your organization is legally bound to, whether short-term or long-term, such as: leases of property or equipment; contracts for future purchases; or unused letters of credit or obligations to reduce debt.
 
Disclosing the nature, amount and terms and conditions of these commitments completes the picture of your organization’s cash position and potential liabilities. You may be planning a capital improvement but haven’t broken ground yet. You’ve entered into an agreement with the builder and that commitment should be disclosed to your readers.
 
Contingencies may or may not become liabilities. They are dependent on some uncertain future event, such as: risk of loss or damage to property; actual or possible claims; or pending or threatened litigation.
 
While you can’t predict the future and aren’t expected to account for any and all possible events, issues known to management at the time the financial statements are prepared should be disclosed. Your CPA will need to know, from you or your legal representative, the probability and potential gain or loss in order to properly disclose the contingency. A contingency may or may not appear on your balance sheet depending on the conditions, the amount and the probability.
 
Management will be preparing for the commitments and contingencies in the ordinary course of budgeting, cash management and overall strategic planning. It is equally important for the readers of your financial statements to be informed about those possible and/or probably future events. Contact your CPA for more details and advice regarding your specific situation.
 
Ryan Skuce joined Earney & Company, L.L.P. in 2003, and became a partner in November 2013. He works extensively with physicians, medical practices, and large medical groups. Ryan has experience in accounting and tax services including financial reporting and analysis, technical support, cash flow planning, physician compensation strategies, and medical practice strategic planning. He also has experience in the areas of accounting and tax for a variety of for profit and nonprofit clients. Ryan is currently a member of the American Institute of Certified Public Accountants (AICPA) and the North Carolina Association of Certified Public Accountants (NCACPA). Ryan works with his clients on evaluating operational and technical issues. He provides back-office accounting support, and recommends and assists in the implementation of ideas to cut overhead costs and streamline operations. With an in-depth knowledge of existing and proposed tax laws, Ryan often advises companies on tax deferment or savings through proactive structuring of transactions. He also assists his clients with Internal Revenue Service audits. He received his Masters of Science in Accountancy from UNC-Wilmington and resides in Wilmington, where he enjoys playing hockey with a local team.

Ecolarge 1016184145
Ico insights

INSIGHTS

SPONSORS' CONTENT
Mel profilephoto

Influencer Marketing: Tap Into Your Audience On A Budget

Mel Beasley - Wide Open Tech
Mikeharrington carolinaretreats 2

Boosting Off-Season Vacation Rental Income With Technology Upgrades: Gaming, Wi-Fi, Charging Outlets, TV, Streaming, Etc.

Mike Harrington - Carolina Retreats
Dane

Can You Do Well By Doing Good?

Dane Scalise - GriffinEstep Benefit Group

Trending News

Will $500M Development Across The River Sink Or Swim?

Cece Nunn - Oct 15, 2021

Wilmington Entrepeneur Launches MyPeriodPal

Johanna Cano - Oct 15, 2021

NCino's Expansion Progresses At Wilmington HQ

Cece Nunn - Oct 15, 2021

Info Junkie: Jhaniqua Farrar Palmer

Staff Reports - Oct 15, 2021

New Eateries Add Flavor To District

Justin Pope Williams - Oct 15, 2021

In The Current Issue

Health Care Heroes: Lifetime Achievement

“He’s a very quiet-spoken guy, and you would never know what a big deal he is just by talking with him,” said Jim Price, a retired OB/GYN, o...


Social District Could Serve As Business Boost

Wilmington leaders and business owners are hoping to establish their own social district in the downtown central business district (CBD) soo...


Health Care Heroes: Innovation

The Innovation category honors an individual or team behind a new scientific discovery, procedure, treatment or device that can save lives o...

Book On Business

The 2021 WilmingtonBiz: Book on Business is an annual publication showcasing the Wilmington region as a center of business.

Order Your Copy Today!


Galleries

Videos

Trying to Grow a Business?
2020 Health Care Heroes
2020 WilmingtonBiz 100