Major changes in US trade policy are underway, and they are already affecting the cost of doing business. A new executive order issued in April 2025 sets a base tariff of 10% on most imported items, with higher charges available based on the country and product type. If your company relies on international suppliers, this is more than just a headline; it has a direct impact on your cost structure, financial projections, and strategic planning.
As your accounting partner, we want to help you change with confidence. Here's what you need to know—and how we can help protect your margins, keep your firm compliant, and position you to adapt swiftly in a changing trade climate.
1. Higher Import Costs Are Squeezing Cash Flow
What is happening: Tariffs increase the landing cost of commodities. For many businesses, this implies smaller margins—or the difficult decision to increase prices.
What this implies for you: Even a 10% tariff can significantly impact your COGS and cash flow. Without a plan, you risk being overextended, particularly if you carry inventory or operate on tight margins.
How we help:
● Analyze your new cost structure.
● Create budget scenarios based on changeable tariff rates.
● Identify ways to preserve margins and free up working capital.
Now is the time to stress-test your cash flow model before a catastrophe occurs.
2. Compliance Just Got More Complicated
What's going on: Tariff expenses affect inventory accounting, financial reports, and tax reporting.
What it means for you: If you're capitalizing inventory, the additional charges may impact how and when expenses appear on your books. If you are submitted to an audit, inaccurate reporting may raise red flags. When you work across borders, transfer pricing and international compliance become considerably more complicated.
How we help:
● Accurately classify and track tariff expenses.
● Ensure compliance with inventory value and reporting regulations.
● Adapt your tax plan to accommodate shifting spending timing and structure.
● Ensure transfer price aligns with global tax rules.
We'll help you stay audit-ready, up to current, and confident in your reports.
3. Planning in a Volatile Environment Requires Better Forecasting
What's going on: Tariff rates are not static, and policy changes can occur swiftly. This makes long-term planning a changing objective.
What this implies for you: It is more difficult to make accurate financial planning, pricing, and supply chain decisions when the rules may change next quarter. Without built-in flexibility, you risk overspending or losing out on cost-effective pivots.
How we help:
● Create flexible predictions
● Generate best- and worst-case scenarios based on changing policies
● Assess suppliers, pricing tactics, and sourcing possibilities.
We'll provide you with the numbers and knowledge you need to make informed decisions, regardless of what happens next.
4. Thinking About Reshoring? There Are Tax and Budget Implications
What's going on: Some corporations are considering returning to U.S. production to lessen their exposure to trade disruptions.
What it means for you: While shifting production locally may decrease long-term tariff risk, it entails initial costs—and potential tax advantages.
How we help:
● Analyze the cost-benefit of reshoring or regionalizing activities.
● Identify federal and state tax benefits or deductions.
● Optimize your investment structure for tax efficiency.
Before you make a decision, let's lay out the entire financial picture together.
Now’s the Time to Get Proactive
You cannot control trade policy, but you can influence how your company responds. With the correct financial approach, you can absorb costs, maintain compliance, and adapt quickly.
Let's discuss how these developments will influence your business—and what you can do to stay ahead.
Contact our office today to set up a planning appointment. We'll assist you negotiate tariff changes, manage risk, and safeguard your bottom line.
