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Manufacturer/Distributor
A national manufacturing company engaged RubinBrown for audit and tax services. During the initial phases of this audit and tax preparation RubinBrown professionals discovered the client had a compliance issue with the State of Michigan. Our initial review determined the client had compliance issues in numerous states. RubinBrown SALT professionals negotiated voluntary disclosure agreements with those states in which the client was not currently filing returns. These agreements enabled the client to limit the amount of tax liability and the eliminated late filing penalties saving the client more than $200,000.

Distributor
The examination of the income tax apportionment methods for a new client created a state tax savings opportunity. The previous tax preparer was unaware of the optional methods of state tax apportionment in Missouri. RubinBrown was able to assist the client in adopting a method that resulted in income tax savings.

National Manufacturer
The manufacturer was contacted by a state in which the client was not filing corporate income tax returns. RubinBrown assisted with the response to the nexus questionnaire and in doing so was able to convince the state that the company was not subject to their corporate income tax laws because the activities were limited to the mere solicitation of sales of tangible personal property. The estimated tax savings was more than $100,000.

Real and Personal Property Tax

Mining Operations
With assessment officials seeking value increases averaging more than 35%, RubinBrown's professionals were able to negotiate a multiple jurisdictional settlement of the value assigned to equipment, structures and ore reserves for this vertically integrated primary metal producer that resulted in average value increase of less than 5%.

Credit and Incentives

Small Business Manufacturer
A manufacturing client desired to expand its business to the State of Illinois. The expansion was budgeted to cost $650K, but the client had only a business plan and $50K of available cash. RubinBrown negotiated a $50,000 grant from the state, a $250,000 industrial equipment loan from the target county, and facilitated the client's introduction to a primary lender willing to provide the final $300,000 to fund the expansion.

Inventory Management

RubinBrown assisted a $100MM manufacturer in identifying and resolving a physical inventory issue at a decentralized warehouse. The warehouse had a poor inventory system, inefficient layout, and inexperienced warehouse personnel. Furthermore, the receiving, shipping, and cycle counting processes in place were not effective. Due to all of these factors, the client was not able to maintain accurate inventory records at the warehouse and was in danger of losing a significant customer.

• Facilitating a wall-to-wall physical inventory count and reconciliation
• Designing procedures to ensure proper inventory management
• Recommending the appropriate warehouse layout to maximize efficiency
• Communicating planned improvements to the client’s customers

A large distributor experienced a significant and unexplained book-to-physical inventory adjustment over several years. The unexpected adjustments prompted the private equity investors to engage RubinBrown to determine why the inventory adjustment occurred and how to prevent future negative adjustments.

• Recommending new standard cost procedures that accurately relieved inventory
• Developing a tool that evaluated potential book to physical differences on a monthly basis
• Comparing the capabilities of the existing general ledger system to the client’s current needs (most likely resulting in a new system)
• Evaluating existing staffing capabilities

A $1 billion food manufacturer utilized a co-packing facility for finished good production. Raw materials were provided by our client to the co-packer who then produced the finished goods. The co-packer had negotiated an accepted production loss percentage at 2 percent. Any production loss, spoilage, damaged product, etc. in excess of 2 percent was to be bourn by the contractor and credited to the client.

Raw material inventory levels were tracked and monitored by the co-packer who also completed a monthly inventory roll forward of the raw materials, work in process, and finished goods. Over time, the raw material inventory levels did not reconcile with the finished goods shipments alerting the client to significant differences in on-hand inventory.

• Working with the co-packer to determine the root cause of inventory differences.
• Evaluating inventory control procedures at the co-packer and recommending improvements.
• Reconciling usage records at the co-packer to our client’s records, and assessing the dollar impact.