Keeping an eye on accurate revenue and expense reporting are central to an accounting professional’s ability to add value to the company and to help improve the bottom line. Tools to accomplish this may include the following:

· The 80/20 rule normally applies when analyzing costs. If you begin with the top 20% of accounts with the greatest dollar amount and transaction volume, you are likely to address 80% of the potential errors in systems. Also, accounts that have been inactive for 20% of your product’s lifecycle pose an 80% greater risk of someone with devious intentions creating transactions outside of the norm.

· Establishing a tracking mechanism for contracts and agreements for equipment expiration dates for items such as telephone equipment, copiers, computer leases, office services, and vehicles maintenance can help to reduce expenses. There may be clauses in agreements that cause an automatic renewal or an early buyout clause that can cost a substantial amount of the remaining term of the agreement if your situation has changed to where the service, item or lease is no longer needed in this down market.

· Payroll costs are minimized by keeping an eye on what the company’s responsibilities are before they cost extra. Compliance with federal, state and local mandatory regulations for timely and accurate reporting of Worker’s Compensation incidents, employee garnishments, overtime rules and tax filings in various states can be extremely costly if you are unaware or choose to ignore the regulations and incur needless fines, penalties and/or interest.

· Analyzing your system workflow processes many times reveals duplication of efforts and points to opportunities to streamline processes, thereby saving time and reducing expenses. Additionally, gaps may be identified where revenue or expenses are not being reported appropriately or not at all. There may be situations that do not reflect all of the revenue possibilities which are costing money every time a transaction takes place.

Private companies, although not required to do so, may benefit by adopting some of the principles and techniques of Sarbanes-Oxley regulations which are followed by publicly-traded companies to keep a closer eye on financial reporting. This can be done by establishing key internal controls of Items that are sometimes overlooked in financial review and have the potential of becoming areas where the accuracy of reporting can go astray. This includes the documentation concepts of transactions’ answers to who, what, where, when and why by testing for completeness, existence/occurrence, valuation/allocation, rights/obligations, presentation/disclosure, custody of assets, and segregation of duties, to mention a few.

By applying the 80/20 rule, putting tracking mechanisms in place, complying with regulations, analyzing system processes and establishing key internal controls, you can proactively seek opportunities to reduce expenses to the company within the realm of your area of responsibility.