Accounting
methods changes

Are you using the correct
accounting method?

Make sure you are using the right accounting method for your needs

Accounting methods are prescribed ways of reporting an organization's income and expenses, using tax methods that clearly and consistently reflect income. Once an organization adopts a particular accounting method, it must normally continue to use that method unless a request to change methods is filed with the IRS, or the change is eligible for automatic IRS consent.

See how our accounting methods changes service could help your organization.
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Accounting methods changes

Consider who benefits

Organizations that have experienced dramatic changes (mergers, acquisitions, restructuring etc.)

Organizations that have experienced dramatic growth

Organizations that are subject to a switch in regulatory requirements

Consider the benefits

May improve cash flow through reduction of income tax obligations

Enhanced benefit likely as organization grows

May present a more accurate and consistent view of an organization's taxable income

May adapt to an existing or new IRS regulatory requirement

How AGH's accounting methods changes service can help your organization

Accounting method changes are most commonly related to how (and when) an organization reports its revenue and expenses (i.e., cash vs. accrual), how inventory is valued (i.e., LIFO vs. FIFO or other hybrid methods), or how depreciation is calculated. Accounting method changes in which tax code clarifications have delivered the opportunity for significant benefit include prepaid expenses, recurring-item exception for expenses, and advance payments regarding income inclusion or exclusion.

An AGH tax professional can evaluate your organization and the types of accounting methods currently in use, as well as your environment, goals and applicable regulatory requirements. The professional will then outline any proposed accounting method changes and the pros and cons of each, as well as help you file for IRS consent to an accounting method change (if necessary) and provide support in implementing the change within your organization.

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Shawn Sullivan

Executive Vice President
Tax Services

Shawn serves as one of two primary leaders in the firm’s large tax group. He has extensive public and private experience in the fields of tax and accounting and works frequently with clients in the manufacturing, wholesale/retail distribution, real estate development and management, construction, and contractor industries. In addition to enhancing business performance to minimize tax consequences, he has experience in mergers and acquisitions and international tax and business structuring.

A certified public accountant, Shawn is a member of the American Institute of Certified Public Accountants, the Kansas Society of Certified Public Accountants (KSCPA) and chairs the KSCPA Committee on Taxation.