{"id":1365,"date":"2014-02-16T22:07:21","date_gmt":"2014-02-16T22:07:21","guid":{"rendered":"http:\/\/suretyone.com\/blog\/?p=1365"},"modified":"2017-01-03T16:20:32","modified_gmt":"2017-01-03T16:20:32","slug":"contract-surety-tax-returns-are-not-financial-statements","status":"publish","type":"post","link":"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/","title":{"rendered":"Contract Surety – Tax Returns are NOT Financial Statements"},"content":{"rendered":"

Bottom line, tax returns are NEVER acceptable financial reports when applying for contract surety bonding<\/a><\/strong>. Except for very small bond requests a contract surety underwriter will require one more years of proper financial statements prepared by a certified public accountant (CPA). There are three levels of CPA service or \u201cscopes of engagement\u201d; \u00a0a compilation, review or preparation to full audit standards. For performance bond<\/a><\/strong> requests under $400,000, a compilation or reviewed statement can be acceptable when accompanied by bank statements and\/or other evidence of the veracity of the information provided in the statement. For all other requests a surety bond underwriter will invariably request an audited financial presentation, and preferably by the \u201cpercentage of completion\u201d method. Percentage of completion reports is superior to other methods because this particular technique estimates profits on partially completed projects.<\/p>\n

A GAAP compliant financial statement includes:<\/p>\n

* Auditor\u2019s Report
\n* Balance Sheet
\n* Income Statement
\n* Statement of Changes in Stockholder Equity
\n* Statement of Cash Flows
\n* Auditor\u2019s\/CPA\u2019s Notes<\/p>\n

All of these elements of a properly prepared financial statement are necessary for a performance bond underwriter in order to measure a contractor\u2019s financial condition at any one point in time. Most of the bond underwriter\u2019s analysis and the formulas used to determine bond approval limits are dependent on the organized presentation of the statement. Tax returns do not<\/span> contain the detailed information needed to accomplish an underwriting review.<\/p>\n

Retention of an accountant familiar with percentage of completion\/capital-cost methods of statement preparation is invaluable to a contractor. Poor financial statement presentations or submission of tax returns to support a performance bond<\/a><\/strong> submission are a frequent cause of declinations of a contract surety bonding request.<\/p>\n

National surety leader, Surety One, Inc. focuses on supporting the performance bonding needs of the commercial, highway, heavy industrial and construction contracting industries. We offer performance bonds to construction and commercial service contractor applicants small and large. Visit SuretyOne.com<\/a>, call (787) 333-0222<\/span> or (800) 373-2804<\/span>, or email Underwriting@SuretyOne.com<\/span> for a performance bond<\/a><\/strong> application package or information about any surety bonding need. Recu\u00e9rde que le asesoramos en SU idioma, as\u00ed que comun\u00edquese con nosotros, SU compa\u00f1\u00eda afianzadora preferida para la fianza.<\/p>\n","protected":false},"excerpt":{"rendered":"

Bottom line, tax returns are NEVER acceptable financial reports when applying for contract surety bonding. Except for very small bond requests a contract surety underwriter will require one more years of proper financial statements prepared by a certified public accountant… Continue Reading →<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[328],"tags":[26,27,1674,1675,1589,1676,345,332,1678,1574,1677],"yoast_head":"\nContract Surety - Tax Returns are NOT Financial Statements • Surety One, Inc.<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Contract Surety - Tax Returns are NOT Financial Statements • Surety One, Inc.\" \/>\n<meta property=\"og:description\" content=\"Bottom line, tax returns are NEVER acceptable financial reports when applying for contract surety bonding. Except for very small bond requests a contract surety underwriter will require one more years of proper financial statements prepared by a certified public accountant... Continue Reading →\" \/>\n<meta property=\"og:url\" content=\"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/\" \/>\n<meta property=\"og:site_name\" content=\"Surety One, Inc.\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Surety1\/\" \/>\n<meta property=\"article:author\" content=\"https:\/\/www.facebook.com\/Surety1\" \/>\n<meta property=\"article:published_time\" content=\"2014-02-16T22:07:21+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2017-01-03T16:20:32+00:00\" \/>\n<meta name=\"twitter:card\" content=\"summary\" \/>\n<meta name=\"twitter:creator\" content=\"@SuretyOne\" \/>\n<meta name=\"twitter:site\" content=\"@SuretyOne\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"C. Poindexter\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebSite\",\"@id\":\"https:\/\/suretyone.com\/blog\/#website\",\"url\":\"https:\/\/suretyone.com\/blog\/\",\"name\":\"Surety One, Inc.\",\"description\":\"Our Blog\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/suretyone.com\/blog\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/#webpage\",\"url\":\"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/\",\"name\":\"Contract Surety - Tax Returns are NOT Financial Statements • Surety One, Inc.\",\"isPartOf\":{\"@id\":\"https:\/\/suretyone.com\/blog\/#website\"},\"datePublished\":\"2014-02-16T22:07:21+00:00\",\"dateModified\":\"2017-01-03T16:20:32+00:00\",\"author\":{\"@id\":\"https:\/\/suretyone.com\/blog\/#\/schema\/person\/d34de27c146d5df3d1fb94d9b0c04605\"},\"breadcrumb\":{\"@id\":\"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/suretyone.com\/blog\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Contract Surety – Tax Returns are NOT Financial Statements\"}]},{\"@type\":\"Person\",\"@id\":\"https:\/\/suretyone.com\/blog\/#\/schema\/person\/d34de27c146d5df3d1fb94d9b0c04605\",\"name\":\"C. Poindexter\",\"sameAs\":[\"https:\/\/www.SuretyOne.com\",\"https:\/\/www.facebook.com\/Surety1\",\"https:\/\/twitter.com\/SuretyOne\"]}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Contract Surety - Tax Returns are NOT Financial Statements • Surety One, Inc.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/","og_locale":"en_US","og_type":"article","og_title":"Contract Surety - Tax Returns are NOT Financial Statements • Surety One, Inc.","og_description":"Bottom line, tax returns are NEVER acceptable financial reports when applying for contract surety bonding. Except for very small bond requests a contract surety underwriter will require one more years of proper financial statements prepared by a certified public accountant... Continue Reading →","og_url":"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/","og_site_name":"Surety One, Inc.","article_publisher":"https:\/\/www.facebook.com\/Surety1\/","article_author":"https:\/\/www.facebook.com\/Surety1","article_published_time":"2014-02-16T22:07:21+00:00","article_modified_time":"2017-01-03T16:20:32+00:00","twitter_card":"summary","twitter_creator":"@SuretyOne","twitter_site":"@SuretyOne","twitter_misc":{"Written by":"C. Poindexter","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebSite","@id":"https:\/\/suretyone.com\/blog\/#website","url":"https:\/\/suretyone.com\/blog\/","name":"Surety One, Inc.","description":"Our Blog","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/suretyone.com\/blog\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/#webpage","url":"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/","name":"Contract Surety - Tax Returns are NOT Financial Statements • Surety One, Inc.","isPartOf":{"@id":"https:\/\/suretyone.com\/blog\/#website"},"datePublished":"2014-02-16T22:07:21+00:00","dateModified":"2017-01-03T16:20:32+00:00","author":{"@id":"https:\/\/suretyone.com\/blog\/#\/schema\/person\/d34de27c146d5df3d1fb94d9b0c04605"},"breadcrumb":{"@id":"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/suretyone.com\/blog\/contract-surety-tax-returns-are-not-financial-statements\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/suretyone.com\/blog\/"},{"@type":"ListItem","position":2,"name":"Contract Surety – Tax Returns are NOT Financial Statements"}]},{"@type":"Person","@id":"https:\/\/suretyone.com\/blog\/#\/schema\/person\/d34de27c146d5df3d1fb94d9b0c04605","name":"C. Poindexter","sameAs":["https:\/\/www.SuretyOne.com","https:\/\/www.facebook.com\/Surety1","https:\/\/twitter.com\/SuretyOne"]}]}},"_links":{"self":[{"href":"https:\/\/suretyone.com\/blog\/wp-json\/wp\/v2\/posts\/1365"}],"collection":[{"href":"https:\/\/suretyone.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/suretyone.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/suretyone.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/suretyone.com\/blog\/wp-json\/wp\/v2\/comments?post=1365"}],"version-history":[{"count":1,"href":"https:\/\/suretyone.com\/blog\/wp-json\/wp\/v2\/posts\/1365\/revisions"}],"predecessor-version":[{"id":1860,"href":"https:\/\/suretyone.com\/blog\/wp-json\/wp\/v2\/posts\/1365\/revisions\/1860"}],"wp:attachment":[{"href":"https:\/\/suretyone.com\/blog\/wp-json\/wp\/v2\/media?parent=1365"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/suretyone.com\/blog\/wp-json\/wp\/v2\/categories?post=1365"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/suretyone.com\/blog\/wp-json\/wp\/v2\/tags?post=1365"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}