Tax Planning Strategies that Can Make a Big Difference

Raiza Kho

Raiza Kho

Director, Tax Services

Tax Planning Strategies that Can Make a Big Difference
Effective tax planning is very important to businesses as it allows them to maximize their profitability and make more accurate and informed financial decisions. Without an effective planning process in place, businesses can wind up paying more than necessary in taxes, funds that otherwise could have gone toward business operations expenses and capital investments.  
For businesses today, one of the biggest challenges related to tax planning is finding the right tax professional early enough in the taxable year to help ensure that planning processes move forward smoothly and are beneficial financially. Typically, businesses start their tax planning during fourth quarter, which they believe leaves them ample time to implement the plan – but this may not be the case.
When constructing your tax plan, it is important to ensure that you are operating your business and reporting your financials in compliance with all governing tax laws. While there may be a temptation to take an aggressive stance related to tax filings, that strategy can lead to tax evasion if you as a business owner are either not knowledgeable on new, evolving regulations – or not careful enough. As taxpayers, we all have a responsibility to contribute to our society. For businesses, that contribution comes, in part, in the form of taxes.
Looking for Knowledgeable and Trusted Tax Support? Click here!

Why Outsource

As a best practice, business owners should consider outsourcing their tax planning and should allow the tax professionals they select to guide them appropriately throughout the process to minimize the financial risks involved. 
Through an outsourcing model, your management team will gain access to proactive tax advising and planning experts who can ensure that your company remains compliant, stays on top of ever-changing regulations, and looks for opportunities to reduce your tax burden in every legal way possible. Businesses owners should consider outsourcing other corporate finance processes as well, including budgeting, fractional CFO services, and general accounting services. This is especially beneficial for industries with specialized needs, such as those requiring biotech accounting services or SaaS accounting expertise, where producing audit-ready management reports demands deep sector knowledge.
Selecting the right tax planning partner can be complicated as there are many firms to choose from, each with its own areas of expertise and fee structure. As a general rule, businesses should look for a partner they trust. That means doing your due diligence when evaluating contractors and accounting firms to ensure that they have a solid track record of success, references who can vouch for their work, a good reputation, and credibility in the industry overall. 
As part of your due diligence efforts, be sure to also ask potential tax planning advisors how aggressive they are willing to be when developing your plan. Every business is different, and every business owner’s tolerance for risk is different. These factors should be brought out in open and honest discussions that will set the precedent for the kind of ongoing communication you will want to have going forward.

Why Partner with Scrubbed

At Scrubbed, we handle tax planning and a range of other financial services for hundreds of businesses worldwide. Our team of accounting and tax experts brings to every client engagement the required industry credentials and licenses and a proven track record of success across a diverse range of industries, from healthcare, real estate, and nonprofits to manufacturing and distribution organizations, and financial institutions. Because we operate on a global basis, we are well versed in current tax laws both domestically and internationally. 
While our talented, versatile, and caring team of professionals is committed to providing your business with outstanding services throughout the tax planning process – and tax season – we can be contracted throughout the year to help with your financial and tax planning needs every step of the way. Our staff of CPAs and other professionals takes the time to truly understand your company and then apply a detail-oriented approach to our work that ensures the advice we give is timely, compliant, and that it allows you to take full advantage of all the deductions and credits available to your company.
As a result, with Scrubbed, your business can keep more of its profits ¬– funds you can use to invest in additional services, expanded product lines, and hire new team members.
Let us help you minimize your tax burden so you can focus on strategically advancing your business instead. Contact us for a free consultation today.



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How Biotech Firms Prepare Financials for IPO

How Biotech Firms Prepare Financials for IPO

Biotech IPOs experienced a surge in 2021, with more than 100 deals raising billions in fresh capital. However, enthusiasm cooled quickly. By 2022, deal volume dropped dramatically, and in 2024, only 24 US biopharma IPOs were completed, the lowest number in more than a decade.Despite this decline, the year ended with signs of recovery. According to GlobalData, the global biotech IPOs in 2024 raised $8.52 billion across 50 deals, the strongest performance since 2021. Investors, however, are becoming cautious and highly selective, favoring firms with later-stage pipelines and strong financial discipline.In this climate, financial preparation is the difference between stumbling through an IPO and stepping into the public markets with confidence. Partnering with specialized experts ensures that your firm is ready when opportunity arrives. To facilitate a successful IPO, here are the key steps biotech firms should take to prepare their financials:1. Start with a Strategic IPO RoadmapMost biotech firms begin preparing for an IPO 12 to 24 months prior to filing. This lead time is crucial, especially since meeting SEC reporting requirements, obtaining audited financial statements, and implementing system upgrades cannot be done overnight.A Reuters survey of healthcare executives in late 2024 reflected this cautious reality: while 64% expected more IPOs in 2025, many anticipated only modest growth compared to the historic highs of 2020 – 2021. With market timing still uncertain and investors highly selective, firms that create a structured plan, covering accounting, governance, and reporting milestones, will be in the best position to move quickly when the right window opens.2. Build Scalable, Compliant Financial Reporting Systems and ProcessesOne of the biggest challenges for biotech firms preparing for an IPO is upgrading their financial reporting systems and processes to meet public company standards. Many operate with lean finance teams and systems designed for private reporting. However, going public necessitates a significant step up in rigor, speed, and transparency.Some key elements to focus on include:Internal controls that meet Sarbanes-Oxley requirements, particularly SOX 404, which mandates an annual assessment of the effectiveness of internal controls over financial reporting.GAAP-compliant accounting policies and processes that address critical and complex areas, such as Revenue Recognition (ASC 606) for collaboration and licensing agreements, R&D Costs (ASC 730), which must be expensed as incurred, the classification of Financial Instruments as debt or equity, and the accounting for Intangible Assets.Scalable systems that can manage quarterly SEC reporting and investor communications effectively.Investing in these systems early can help reduce the risk of costly errors and position finance teams to meet tight deadlines once the firm goes public.3. Prepare and Audit Historical Financial StatementsThe SEC typically requires biotech firms to present at least two years of audited financial statements (sometimes three), along with interim quarterly data. These reports must meet PCAOB standards, which are more stringent than audits for private firms. A key distinction is the requirement for auditors to review and report on the effectiveness of internal controls over financial reporting (ICFR).This phase can be particularly complex for biotech firms, whose expenses are often R&D-driven and may include licensing deals, milestone payments, and joint venture arrangements.As EisnerAmper notes, the IPO process is “stressful and lengthy,” and should never be left to the last minute. For biotech firms with limited finance teams, the challenge is even greater. 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Schedule a free consultation today and learn how our team of CPAs and financial experts can help you enter the public markets with confidence.

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The ESG Translation Gap: Why Good Accounting Data Fails Sustainability Audits

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If I had to name the first common mistake I see growing companies make when they tackle ESG reporting, it is foundational: They don’t know if the data they are using is complete and accurate. More than that, they often don’t even know if it is the data they should be using.For years, ESG reporting was largely voluntary, a way to answer the public’s demand for accountability and show investors you were responsible. But as optional guidelines transition into emerging laws and requirements, the landscape shifts. Investors and regulators no longer want marketing campaigns. They want accurate data provided with assurance.This brings us to a harsh reality I share with teams newly subject to these regulations: If you are required to file a report in 2027 based on 2026 data, and you wait until 2026 to start preparing, you are already late.Leaders often assume their existing accounting systems are naturally ready to handle ESG reporting.They almost never are.The Illusion of AlignmentI see leadership teams fall into this trap constantly. They look at their organizational chart, see a separate Finance team and a separate ESG team, and assume they are covered.But in practice, these two teams are working in silos, speaking entirely different languages.I see this pattern constantly with companies that have been publishing ESG reports voluntarily for a number of years. As they prepare for mandated regulatory reporting, leadership feels secure because their ESG team is getting the exact reports they requested from Finance. But the moment you dig into the architecture and bridge the two teams, the gaps become obvious.Here is how the breakdown usually happens:The Ask: The ESG team needs data to calculate emissions, so they ask Finance for certain reports.The Hand-off: Finance, wanting to be helpful, pulls the data and hands it over.The Gap: Finance teams are wired to be compliant with accounting standards, but they aren’t trained to understand ESG reporting. ESG teams are great at translating finance data into emissions, but they don’t have the concept of an audit.Because the ESG team didn’t have an audit background, they didn’t know how to establish completeness and accuracy. They didn’t know how to look for certain accounting transactions that would otherwise be considered emission or non-emissive (i.e., advance or duplicate payments, reversed entries in the vendor reports). They were running calculations on raw data.The people didn’t fail: the structure simply wasn’t built to translate between the two departments.The Reality of Retroactive CleanupThe true operational complexity of ESG reporting reveals itself when you try to force accounting data into sustainability buckets.Take something as standard as a growing portfolio of leased facilities. From a purely financial perspective, a company might have these perfectly recorded. But you cannot translate that 1:1 to ESG data. For ESG, you have to review the business structure to see who actually holds ‘operational control’ so you can assign those facilities to the proper emissions categories..When a company’s data architecture isn’t set up for this level of granularity, teams are forced to go back and manually revisit hundreds of outstanding contracts. What should take a minute to encode upfront easily turns into a multi-month project just to find the proper data sources.When you wait to build the system, you force your teams to look backward instead of forward.What You Need to Check TodayThe fix is actively bridging the technical gap. You need professionals who can translate complex sustainability metrics into an accounting standard, and vice versa.If you are a CFO or sustainability leader reading this today, before making your next public ESG commitment, take a hard look at your architecture.Ask yourself these three questions:Are my on-book activities scoped properly? Check if all financial transactions have been mapped to the appropriate ESG requirement.Are my off-book activities accounted for? Ensure your people management, technology, and operational data are fully captured.Are all stakeholders involved? If ESG reporting is falling entirely on your Finance team, or solely on your ESG team without Finance’s oversight, you have a translation gap. Operations, HR, and Tech must understand the why and the how of the data they are providing.A calm, predictable reporting cycle is designed, never improvised. Build the data architecture a year or two before the regulations hit, and ensure your financial execution naturally supports confident sustainability reporting.

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