House Passes 2025 Budget Resolution, Setting Stage for Tax Cuts and Spending Reductions

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In a pivotal move that could reshape the tax and fiscal landscape, the U.S. House of Representatives narrowly passed the Fiscal Year 2025 budget resolution (H. Con. Res. 14) on April 10, 2025. The 216–214 vote, following Senate approval, kicks off the reconciliation process—a fast-track legislative path that could bring sweeping changes to tax policy and federal spending. 

Though the resolution itself doesn’t change the law, it sets a legislative roadmap for potential reforms that may significantly impact small businesses, taxpayers, and accounting professionals. Budget resolutions serve as blueprints for spending and revenue priorities and enable major legislation to pass the Senate with a simple majority. 

This year’s resolution stands out for prioritizing the restoration of expired tax provisions, reducing targeted federal spending, and encouraging business investment through tax code modifications. For businesses managing compliance and planning ahead, understanding what’s on the horizon is more important than ever. 

Key Provisions and Potential Impacts 

Tax Reform Initiatives
One of the most anticipated outcomes of this resolution is the potential extension and expansion of key provisions from the 2017 Tax Cuts and Jobs Act (TCJA). These include: 

  • Enhancements to bonus depreciation, which had been phasing out. Reinstating full bonus depreciation would allow businesses to deduct a larger portion of asset costs upfront, supporting capital investment. 
  • The estate tax exemption, which is also set to be cut in half beginning January 1, 2026. This change could have a significant impact on high-net-worth individuals and families, prompting a need for proactive estate and succession planning. 
  • Increases in the Section 179 deduction, which permits the full expensing of qualifying equipment. (Note: Section 179 expensing was made permanent under the TCJA, but any enhancements could still have value for certain businesses.) 
  • Continued support for the Qualified Business Income (QBI) deduction, which reduces taxable income for many pass-through entities. This deduction, along with reduced individual tax rates for business owners, is currently set to expire on December 31, 2025. Addressing the future of these provisions will be a major focus in reconciliation legislation. 

If included in future reconciliation legislation, these provisions would provide immediate benefits to a broad spectrum of businesses, encouraging capital investment and economic growth. 

Section 174 R&D Expensing Fix
Since 2022, businesses have been required to amortize research and experimental (R&E) expenses over five years, rather than deducting them in the year they are incurred. This change has strained cash flow, particularly for startups, technology firms, and companies investing heavily in innovation. 

The FY 2025 budget resolution signals strong legislative intent to reverse this requirement and reinstate full expensing under Section 174. Doing so would not only simplify compliance but also help reinvigorate U.S. R&D investment—a critical driver of long-term economic competitiveness. 

Federal Spending Adjustments
To balance out potential tax cuts, the resolution proposes reductions in non-defense discretionary spending. These spending restraints could affect federal programs like SNAP and Medicaid, though the White House has pledged to protect core benefits. Such cuts, if enacted, would likely provoke significant political and public scrutiny and may face challenges during the reconciliation phase. 

What Happens Next? 

With the budget resolution now finalized, the legislative process moves into its next—and arguably most impactful—stage. The House Ways and Means Committee and the Senate Finance Committee are expected to begin drafting reconciliation bills that include the actual policy changes outlined in the resolution. These bills will be closely watched by businesses, tax professionals, and policymakers alike, as they will define the tax landscape for years to come. 

Reconciliation allows these bills to pass with a simple majority in the Senate, bypassing the typical 60-vote threshold needed to overcome a filibuster. As a result, significant policy shifts could be implemented quickly, assuming political alignment within the majority party. 

What Should Businesses and Individuals Do Now? 

While the exact shape of the legislation is still unknown, there are several important steps you can take to prepare: 

  • Stay Informed: Monitor draft legislation and committee updates. Provisions related to depreciation, QBI, estate tax, and other business-friendly incentives are likely to change—some significantly. 
  • Review Tax Planning Strategies: Evaluate how the expiration of TCJA provisions on 12/31/25—especially those related to QBI, individual tax rates, and the estate tax exemption—could affect your financial position. Early planning may help you capture benefits before they phase out. 
  • Consult Your Advisors: Engaging with your tax advisors early will allow you to explore the potential implications of mid-year changes or retroactive provisions. Whether you’re planning a large purchase, considering gifting strategies, or weighing business investments, professional guidance is key. 
  • Plan for Flexibility: Build flexibility into your business’s financial models and cash flow planning. Whether it’s depreciation schedules, expensing rules, or estate strategies, changes could arrive before year-end. 

Conclusion

The passage of the FY 2025 budget resolution is a critical step toward what could be the most consequential set of tax changes since 2017. While it doesn’t enact changes directly, it sets the stage for swift legislative action through reconciliation. 

At Brady Martz, we are closely monitoring the situation and are here to help you interpret and prepare for whatever comes next. If you have questions about how these potential changes could impact your business or your individual tax strategy, don’t wait—reach out to our team today to start the conversation. 

 

Brady Martz Named Among Accounting Today’s 2025 Top 100 Firms

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Accounting and advisory services firm Brady Martz is proud to announce that it has been named among Accounting Today’s Top 100 Firms, Regional Leaders for the Midwest, and Fastest-Growing Firms in 2025. Each year, Accounting Today releases an annual ranking of the leading national and regional firms, as well as their chief executives’ take on the major issues facing their firms, and their strategies for success for 2025 and beyond.   

“Being named among Accounting Today’s Top 100 Firms, Regional Leaders, and Fastest-Growing Firms is a tremendous honor for Brady Martz. This recognition is a testament to the hard work and dedication of our team members, who consistently go above and beyond to serve our clients and communities,” CEO Stacy DuToit said. “As we look to the future, we remain focused on providing value-added services to our clients. We are grateful for this recognition and excited for the opportunities ahead.” 

To learn more about Accounting Today, trends in the accounting industry, and to view the 2025 leading national and local firms list, visit accountingtoday.com.    

Founded in 1927, Brady Martz has been delivering exceptional client service for almost a century. Headquartered in Grand Forks, the Firm operates across 10 offices in North Dakota, Minnesota, South Dakota, and Texas offering advisory, audit & assurance, and tax services to a diverse range of industries.

IRS Updates Guidance on 179D Tax Deduction: What You Need to Know 

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The Internal Revenue Service (IRS) has recently updated its Large Business & International (LB&I) Process Unit guidance on the Section 179D Energy Efficient Commercial Buildings Deduction. With the introduction of Form 7205 and increased IRS scrutiny, ensuring compliance and partnering with the right provider has never been more critical. 

Key Takeaways from the IRS Guidance 

To successfully secure the 179D deduction and withstand potential audits, building owners and designers must meet the IRS’s evolving expectations. Here are three essential updates from the latest guidance: 

  • Certification Standards are Non-Negotiable – The IRS requires that energy-efficient commercial building property certifications be conducted by licensed professionals, such as engineers or contractors, using IRS-approved software and methodologies. 
  • Allocation Letters Must Be Accurate and Timely – Designers claiming 179D deductions on government-owned or tax-exempt buildings must obtain allocation letters signed by an authorized representative. These letters must contain specific building details and clearly identify all involved parties. Unclear or retroactive documentation will not be accepted. 
  • Thorough Documentation is Mandatory – The IRS expects detailed energy modeling reports, well-documented energy savings calculations, and fully substantiated project files. Incomplete records can lead to audits or denial of deductions. 

Why Choosing the Right Provider Matters 

The IRS’s heightened focus on 179D reinforces the importance of selecting a provider with the expertise to navigate compliance and maximize deductions. Before choosing a provider, consider these key questions: 

  • Does the provider have in-house energy consultants creating energy models? 
  • Does the provider have government relations personnel securing allocation letters? 
  • Does the provider have licensed Professional Engineers to certify claims? 

How Brady Martz Can Help 

At Brady Martz, we help clients navigate complex tax incentives with confidence. Our team of experienced professionals provides the expertise needed to ensure compliance, secure maximum benefits, and reduce audit risks. Contact Brady Martz today to learn how we can help. 

Trump’s Global Tariffs – Major Ramifications for Trade and the U.S. Economy

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On April 2, 2025, President Trump signed an executive order introducing a sweeping new trade policy—”Reciprocal Tariffs.” This move is aimed at addressing what the administration describes as unfair trade practices from certain countries. With tariffs set to range from 10% to as high as 54%, U.S. businesses will face significant disruptions in their supply chains and an increase in costs. Companies operating in the U.S. must now brace for the economic consequences and take proactive steps to assess and manage the potential impact on their operations. 

What Are Reciprocal Tariffs? 

The new Reciprocal Tariffs policy targets countries the U.S. administration believes are not treating U.S. exports fairly. These tariffs are designed to level the playing field by ensuring that U.S. businesses are not disproportionately impacted by unfair trade practices. The rates differ based on the trading partner, with some of the most notable changes affecting major global players. 

Tariff Rates for Selected Trading Partners: 

  • China: 54% (20% existing tariff + 34% reciprocal tariff) 
  • Vietnam: 46% 
  • India: 26% 
  • Japan: 24% 
  • European Union: 20% 
  • United Kingdom: 10% 
  • Canada/Mexico: 0% for qualifying US-Mexico-Canada Trade Agreement (USMCA) products; otherwise, 25% 

Key Dates to Remember: 

  • April 5, 2025: Initial tariffs will take effect. 
  • April 9, 2025: Additional country-specific tariffs will begin to apply. 

What Does This Mean for U.S. Businesses? 

The immediate impact of these tariffs will be felt across various industries, particularly those that rely heavily on imported goods. Here are a few examples to illustrate the potential cost increases: 

  • Apple: Components purchased from China for $100 will now cost $154 at the U.S. border. 
  • Nike: Shoes manufactured in Vietnam for $100 will now cost $146 at the border. 

These increased import costs will likely lead to higher prices for consumers as businesses adjust their pricing to maintain profit margins. Industries such as automotive, steel, and aluminum, which are already subject to high tariffs, will continue to face significant strain. 

Potential Exceptions and Flexibility 

While the tariffs will apply to most imported goods, there are some notable exceptions. For example, imports under the USMCA will remain duty-free, and certain products, such as automobiles and automotive parts, will continue to face the current 25% duties. Additionally, the White House has indicated that these tariff rates could change depending on the outcomes of trade negotiations or retaliatory actions from affected countries. 

How Should Companies Prepare? 

With the new tariffs set to take effect soon, businesses need to reassess their supply chain strategies and understand the potential cost impacts. Here are a few steps to help navigate the evolving trade landscape: 

  1. Cost Impact Modeling:
    Businesses should model the likely cost impact of the new tariffs on their supply chains. Understanding how these tariff increases will affect margins is critical to both short- and long-term planning.
  2. Tax and Duty Mitigation Strategies:
    While the tariffs will increase costs, there are strategies available to reduce tax and duty burdens. For instance, companies can justify lower pricing for customs duty purposes while increasing non-dutiable service fees and royalties. This can help mitigate overall income tax payments while lowering customs duty costs.
  3. Review Contractual Obligations:
    Businesses should review their contracts with foreign suppliers to understand potential renegotiation opportunities in light of the new tariffs. These agreements may need to be updated to reflect the additional costs imposed by the tariffs.
  4. Explore New Markets:
    Companies heavily reliant on goods from high-tariff countries may want to explore new markets or domestic production options. Sourcing from countries not affected by the new tariffs could help offset the cost increases and minimize the impact on profit margins.

Preparing for Uncertainty 

Although the tariffs are set to take effect imminently, the trade landscape may continue to evolve. Trade negotiations or retaliatory measures from affected countries could alter the tariffs or introduce new trade policies. It’s important for businesses to remain agile and prepared to adapt to these developments. 

How Brady Martz Can Help 

At Brady Martz, we are committed to supporting our clients through every challenge and opportunity.  Whether you’re adjusting your business strategy, seeking guidance on financial planning, or navigating complex operational decisions, our team of experienced advisors is here to help. We take pride in offering personalized solutions to meet your unique needs and drive your business forward. Reach out to us today to learn how we can support your continued success. 

 

CEO Stacy DuToit Included in 15 Women You Need to Know in ND Business

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Top 100 nationally ranked accounting and advisory services firm Brady Martz is proud to celebrate CEO Stacy DuToit for being named one of the Greater North Dakota Chamber’s (GNDC) 15 Women You Need to Know in ND Business for 2025. This prestigious recognition highlights women across the state who are driving progress within their organizations, industries, and communities. 

GNDC honors women who exemplify leadership—whether through formal executive roles or by serving as influential voices in their fields. Since assuming the role of CEO in October of last year, DuToit has been instrumental in guiding the Firm’s strategic direction, fostering a culture of collaboration, and championing professional growth for team members. Her leadership has helped solidify Brady Martz’s position as a leading advisory and accounting firm in the region. 

“I am incredibly honored to be recognized alongside such inspiring women who are shaping the future of business in North Dakota,” said DuToit. “This acknowledgment is a testament to the strength of our team at Brady Martz and the impact we can make when we lead with purpose, innovation, and a commitment to our communities.” 

DuToit is a Certified Public Accountant (CPA) with extensive experience in auditing, accounting, tax, and business consulting services for privately owned businesses. A member of both the American Institute of Certified Public Accountants and the North Dakota Society of Certified Public Accountants, she has held several volunteer leadership roles throughout her career, including the Bismarck Mandan Chamber Foundation, Bismarck Downtowner’s Association, ND Jump$tart Coalition, and has served as a former Trustee of the North Dakota Certified Public Accountants Society Foundation. In 2024, DuToit was honored as one of Prairie Business magazine’s Top 25 Women in Business. 

Founded in 1927, Brady Martz has been delivering exceptional client service for almost a century. The Firm was recently recognized by Accounting Today as one of the fastest-growing firms from their 2025 Top 100 Firms/Regional Leaders list. Headquartered in Grand Forks, the Firm operates across 10 offices in North Dakota, Minnesota, South Dakota, and Texas offering advisory, audit & assurance, and tax services to a diverse range of industries.

Shareholder Amy Haagenson Recognized as Prairie Business Top 25 Women in Business

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Top 100 nationally ranked accounting and advisory services firm Brady Martz is proud to celebrate Construction & Real Estate Practice Segment Lead, Board Member, and Shareholder Amy Haagenson for being named one of Prairie Business magazine’s 2025 Top 25 Women in Business. This prestigious award honors outstanding businesswomen across North Dakota, South Dakota, and western Minnesota who have made significant contributions to their industries and communities.  

“We are thrilled to see Amy receive this well-deserved honor. Her leadership, expertise, and commitment to both our clients and our community make her a true asset to our firm and the region,” said CEO Stacy DuToit. “Amy respectfully challenges the past, keeps an eye on the future, and drives progressive change throughout the Firm. She is a remarkable leader, and we couldn’t be prouder.” 

With more than two decades of experience in accounting, Haagenson has dedicated her career to providing exceptional consulting, tax, and assurance services, primarily within the construction and real estate sectors. Haagenson said that her passion for working in the construction industry “stems from a deep respect for these family-owned businesses that generation after generation have built homes, roads, bridges, and infrastructure that keeps our communities strong and thriving.” Since joining Brady Martz in 2000, she has played a pivotal role in advancing the Firm’s industry specialization efforts, ensuring clients receive expert guidance tailored to their business needs. 

Beyond her professional achievements, Haagenson is the proud mother of three grown boys and is deeply committed to giving back to her community. She actively supports the American Institute of Certified Public Accountants and the North Dakota CPA Society while also serving on the YMCA Board of Trustees. Haagenson’s dedication to fostering professional excellence and strengthening community initiatives exemplifies the values that Prairie Business seeks to recognize with this award. The annual Top 25 Women in Business list celebrates remarkable women who are shaping the business landscape through leadership, innovation, and service. Haagenson’s recognition underscores her significant impact on the accounting profession and her dedication to making a difference in the lives of those around her.

The Impact of Tariffs: Balancing Costs, Supply Chain and Profitability

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REAL ECONOMY BLOG | February 14, 2025

Authored by RSM US LLP

Raising tariffs can drive up consumer prices, lower demand and hurt business profitability. Unless market forces are considered when employing tariffs, these negatives may occur without also achieving the desired benefit of a shift from foreign to domestic production.

As tariffs rise, imported goods often become more expensive, prompting consumer businesses to seek the lowest-cost supplier. A switch to domestic production occurs only if tariffs make domestic goods the cheapest option. Otherwise, tariffs simply increase costs, reduce supply choices and impose higher taxes without compelling a production shift.

Tariff dynamics

Consider the following chart that narrows in on these dynamics, where the dotted line represents the point of change from foreign supplier to domestic supplier. On the left side of the dotted line, the domestic sales revenue of a product is low until tariffs are raised high enough to make the domestic supplier the cheapest option, at which point domestic suppliers benefit. However, until that shift occurs, the net consumer price increases along with tariffs without the resulting benefit of domestic production.

Similarly, a Tax Foundation study of the tariffs that George W. Bush’s administration imposed in 2002 on imported steel showed that higher tariffs led to increased consumer prices and lower demand, causing job losses in industries that rely on those goods. If tariffs fail to shift sourcing to domestic suppliers, they reduce demand and limit consumer access to products without boosting domestic production and jobs.

Additionally, when input costs are higher due to tariffs, regardless of the tariff level, domestic manufacturers must sell their products at a higher price to maintain their margins. This results in reduced exports due to selling a now more expensive product compared to foreign competitors who do not have to pay those tariffs.

Tariff complexities

Even when tariffs are increased, targeting specific countries, unless the tariffs result in the domestic price being the cheapest price, businesses may find that switching to a different but still foreign producer is their most affordable option.

Additionally, the price differences between domestic and foreign producers vary depending on the product. Therefore, the same percentage tariff on all products may result in a switch to domestic production for some products, but for others, only an increased price passed on to consumers.

China offers unit values lower than the cheapest non-China alternative for about 45% of the product categories that the U.S. imports from China, according to the Federal Reserve Bank of St. Louis.

Importantly, quality and feature differences within product categories mean that the cheapest products are not always chosen, as products are not always directly comparable. Oftentimes, there is a mixture of foreign and domestically produced products sold at the same time, leaving customers to determine the value to place on certain features. This means that tariffs do not always have the intended effect.

A 2019 study by the National Bureau of Economic Research found that in response to 2018 tariffs on washing machines, in nearly all source countries, the price rose by nearly 12%. Interestingly, the price of U.S.-produced washing machines also went up, along with the price of dryers, which were not included in the tariff. While the increased domestic production resulted in roughly 1,800 more jobs, the higher product prices cost consumers $1.5 billion more. The net result is that consumers paid $815,000 per job created.

The takeaway

Consumer businesses should diversify their supply chains to ensure they can purchase products from the lowest-cost providers and weather cost increases caused by tariffs on specific countries. Higher tariffs raise costs regardless of the supplier. To maintain profitability, businesses must improve efficiency and, where possible, pass costs to customers by adjusting prices across products, including those unaffected by tariff increases, to meet demand and market share. In addition, businesses should leverage innovation and technology to enhance product quality and features, while also offering options to fit different budgets.

For more insights on tariffs, read: How an escalating trade war will affect global growth, inflation and employment.

This article was written by Peter Ramer and originally appeared on 2025-02-14. Reprinted with permission from RSM US LLP.
© 2024 RSM US LLP. All rights reserved. https://realeconomy.rsmus.com/the-impact-of-tariffs-balancing-costs-supply-chain-and-profitability/

RSM US LLP is a limited liability partnership and the U.S. member firm of RSM International, a global network of independent assurance, tax and consulting firms. The member firms of RSM International collaborate to provide services to global clients, but are separate and distinct legal entities that cannot obligate each other. Each member firm is responsible only for its own acts and omissions, and not those of any other party. Visit rsmus.com/about for more information regarding RSM US LLP and RSM International.

Regulation B Section 1071: Implementation Best Practices for Financial Institutions

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The financial industry is facing a significant shift with the implementation of Regulation B Section 1071, as mandated by the Dodd-Frank Act. This new rule introduces extensive data collection and reporting requirements for financial institutions making small business loans. Designed to promote fairness and transparency in lending, Regulation B Section 1071 seeks to uncover and address potential discrimination in credit access for small businesses, particularly those owned by women and minorities.

While the regulation represents a step forward for equitable lending practices, it also introduces operational and compliance challenges. For financial institutions, understanding the requirements and developing a strong implementation plan will be critical for navigating these changes.

In this blog, we’ll explore key considerations and best practices for implementing Section 1071 to ensure compliance while maintaining efficiency in your institution’s processes.

Understanding Regulation B Section 1071

Under Section 1071, financial institutions are required to collect and report data on applications for credit from small businesses. This includes gathering information on the race, ethnicity, and gender of the business owner(s), as well as the loan amount, application outcome, and pricing terms. The goal is to promote fair lending and provide policymakers with insight into access to credit across different demographics.

The rule applies to institutions that originated at least 100 small business loans in the previous two calendar years, covering a wide range of credit products such as term loans, lines of credit, and business credit cards. Noncompliance with Section 1071 can result in regulatory scrutiny, fines, and reputational harm.

With the compliance deadline approaching, financial institutions must take proactive steps to prepare for the implementation of this regulation.

Best Practices for Implementing Section 1071

To ensure a smooth transition and ongoing compliance, financial institutions should consider the following best practices:

  1. Conduct a Gap Analysis

Begin by reviewing your current loan application and reporting processes to identify gaps in compliance with Section 1071. Evaluate your institution’s ability to collect the required data points, and assess whether your existing systems and procedures can support the additional reporting requirements.

Key Considerations:

  • Are your loan officers trained to collect demographic information?
  • Do your current systems accurately capture and store the required data?
  • Is your team aware of fair lending rules and how to handle sensitive customer information?
  1. Upgrade Your Technology and Data Management Systems

Effective implementation of Section 1071 requires robust data collection, storage, and reporting capabilities. Financial institutions may need to upgrade their loan origination systems (LOS), customer relationship management (CRM) platforms, and data analytics tools to meet these demands.

Best Practices:

  • Implement systems that can securely capture and store sensitive demographic data.
  • Automate reporting processes to reduce the risk of errors and streamline compliance efforts.
  • Invest in technology solutions that support efficient data analysis for fair lending reviews.
  1. Train Staff on Compliance and Customer Communication

Collecting demographic information requires careful communication with customers to ensure transparency and compliance with fair lending regulations. Loan officers and other front-line staff should receive training on how to explain the purpose of data collection and handle customer concerns.

Training Tips:

  • Develop clear, customer-friendly explanations about why demographic data is being collected.
  • Train staff to address customer questions while remaining compliant with regulatory requirements.
  • Emphasize the importance of unbiased interactions during the loan application process.
  1. Establish Monitoring and Reporting Protocols

Regular monitoring of your institution’s data collection and reporting processes will be critical to ensuring ongoing compliance with Section 1071. Establish clear protocols for reviewing loan data, identifying discrepancies, and addressing potential issues.

Steps to Take:

  • Develop a reporting schedule to ensure timely submission of data to regulators.
  • Use data analytics to identify trends and detect potential fair lending risks.
  • Conduct internal audits to verify the accuracy of collected data and ensure adherence to regulatory requirements.
  1. Collaborate with Industry Peers and Experts

Compliance with Section 1071 is a complex task that benefits from collaboration. Financial institutions can engage with industry groups, consultants, and legal experts to share insights, develop best practices, and navigate challenges.

Benefits of Collaboration:

  • Gain access to industry-specific resources and case studies.
  • Stay informed about regulatory updates and interpretations.
  • Leverage the expertise of third-party consultants to enhance your compliance efforts.

The Path Forward: Building a Culture of Compliance

Implementing Regulation B Section 1071 is about more than meeting regulatory requirements—it’s an opportunity for financial institutions to foster transparency, fairness, and trust with their small business customers. By developing a robust compliance plan, investing in technology and training, and maintaining a proactive approach to risk management, your institution can successfully navigate this new regulatory landscape.

At Brady Martz, we understand the unique challenges financial institutions face in implementing complex regulations like Section 1071. Our team of experts can help you assess your readiness, develop a tailored implementation strategy, and ensure your institution remains compliant while achieving its business goals. Contact us today to learn how we can support your compliance journey.

Risk Assessments – Not a One and Done

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In today’s ever-changing business environment, organizations face new challenges daily, from evolving market conditions to emerging cybersecurity threats. As a result, the concept of risk assessment has become more critical than ever. However, many companies make the mistake of viewing risk assessments as a one-time task instead of an ongoing, strategic process.

This mindset can leave organizations vulnerable, as risks evolve alongside changes in technology, industry regulations, and global markets. To truly protect your business and remain resilient, risk assessments must be treated as a continuous process that adapts to the shifting landscape.

What Is a Risk Assessment?

A risk assessment is the process of identifying, analyzing, and prioritizing potential risks that could impact your business. These risks may include operational inefficiencies, financial vulnerabilities, compliance issues, or cybersecurity threats.

A comprehensive risk assessment typically involves:

  • Identifying potential risks or vulnerabilities.
  • Analyzing the likelihood and impact of those risks.
  • Developing mitigation strategies to reduce risk exposure.

While many businesses conduct risk assessments during audits or after a significant event (such as a data breach), a “set it and forget it” approach often leads to gaps that can compromise an organization’s stability and reputation.

Why Risk Assessments Must Be Ongoing

Risks are not static. Here are some key reasons why businesses should adopt an ongoing approach to risk assessments:

  1. Evolving Threats and Trends

Technology is advancing at an unprecedented rate, and so are the threats. For example, as businesses rely more on digital platforms, cybersecurity risks like ransomware, phishing, and insider threats continue to grow. A risk assessment conducted last year may not account for these new vulnerabilities.

  1. Regulatory Changes

Governments and industry regulators frequently update compliance requirements to address emerging risks. Without periodic risk assessments, businesses may inadvertently fall out of compliance, exposing themselves to penalties, fines, or reputational damage.

  1. Internal Changes

Internal changes such as staff turnover, mergers and acquisitions, or the implementation of new technologies can create unforeseen risks. Conducting risk assessments regularly ensures that new processes, people, or systems are incorporated into your risk management strategy.

  1. Market and Economic Shifts

Market volatility and global events, like inflation, supply chain disruptions, or geopolitical tensions, can introduce new financial and operational risks. Ongoing assessments help organizations stay proactive and ready to pivot as conditions change.

Best Practices for Continuous Risk Assessments

To embed risk assessments into your business processes effectively, consider these best practices:

  1. Schedule Regular Risk Reviews

Conduct risk assessments on a scheduled basis, such as quarterly, semi-annually, or annually, depending on your industry and risk exposure.

  1. Involve Cross-Functional Teams

Risk management isn’t just the responsibility of one department. Involve leaders from IT, finance, HR, operations, and other key areas to ensure all perspectives are considered.

  1. Leverage Technology

Use risk management software or tools to automate parts of the process, such as tracking risks, generating reports, or monitoring compliance metrics in real time.

  1. Align with Strategic Goals

Risk assessments should align with your organization’s long-term objectives. This ensures that resources are allocated toward mitigating risks that could derail your key initiatives.

  1. Perform Scenario Planning

In addition to analyzing current risks, consider potential “what-if” scenarios. This proactive approach can help you prepare for unexpected events.

Don’t Treat Risk Assessments as a Checklist

Risk assessments are not a one-and-done task—they are an ongoing commitment to safeguarding your organization from the unexpected. By adopting a continuous approach to risk management, you can stay ahead of potential challenges, protect your business assets, and build long-term resilience.

At Brady Martz, our experienced professionals can guide you through the risk assessment process, helping you identify vulnerabilities, develop mitigation strategies, and create a proactive plan to keep your business secure. Contact us today to learn how we can help you protect your organization and prepare for the future.

Mitigating Cybersecurity Risks in the Financial Sector: Best Practices for 2025

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As financial institutions continue to digitize their services and offer more online solutions to customers, the risk of cyberattacks and data breaches grows exponentially. With sensitive financial data, personal information, and proprietary business intelligence at stake, cybersecurity remains one of the most critical concerns for the financial industry. In 2025, the threat landscape is expected to become even more complex, with cybercriminals employing increasingly sophisticated methods to exploit vulnerabilities.

At Brady Martz, we understand the complexities of cybersecurity in the financial sector. With services like IT audits, we can help financial institutions assess their systems, identify vulnerabilities, and implement stronger safeguards against potential breaches.

In this article, we’ll explore the cybersecurity risks facing financial institutions in 2025 and provide a comprehensive guide to best practices that will help mitigate those risks and safeguard against potential breaches.

  1. The Growing Cybersecurity Threat Landscape

The financial sector has long been a target for cybercriminals due to the valuable data and financial assets it holds. With the rise of digital banking, cloud services, and mobile payments, these threats have become even more prevalent and sophisticated. In 2025, financial institutions can expect to see an increase in:

  • Ransomware Attacks: Cybercriminals continue to use ransomware to target financial institutions, locking them out of critical systems until a ransom is paid.
  • Phishing and Social Engineering: As the sophistication of phishing schemes increases, attackers are likely to target employees, customers, and partners with deceptive emails or phone calls designed to steal sensitive information.
  • Advanced Persistent Threats (APTs): These ongoing, targeted cyberattacks are designed to infiltrate an institution’s network and remain undetected for extended periods.
  • Insider Threats: Employees with access to sensitive data pose an internal threat, either intentionally or accidentally causing harm.

To combat these risks, financial institutions must be proactive in their approach to cybersecurity, employing a multi-layered defense strategy that includes technological, procedural, and educational measures.

  1. Best Practices for Cybersecurity in 2025

In 2025, financial institutions must adopt a comprehensive cybersecurity strategy to protect their digital infrastructure and maintain customer trust. Here are the best practices to mitigate cybersecurity risks effectively:

  1. Strengthening Identity and Access Management (IAM)

One of the key pillars of a secure financial institution is managing who has access to sensitive systems and data. Implementing robust Identity and Access Management (IAM) controls can help ensure that only authorized individuals have access to critical information.

Best practices for IAM include:

  • Multi-factor Authentication (MFA): Requiring two or more forms of verification (e.g., passwords, biometrics, security tokens) adds an extra layer of security to online transactions and internal systems.
  • Role-Based Access Control (RBAC): Limit employee access to systems based on their role within the organization, ensuring that only those who need access to sensitive data can access it.
  • Regular Access Reviews: Conduct periodic audits to review access permissions, removing or adjusting access for employees who no longer require it.
  1. Investing in Advanced Threat Detection and Prevention Tools

Financial institutions must deploy next-generation threat detection systems to identify and respond to cyber threats in real time. Technologies such as AI-powered security systems and behavioral analytics can help detect unusual network activity or unauthorized access attempts before they escalate into serious breaches.

  1. Educating Employees and Customers on Cyber Hygiene

Human error is one of the most common causes of cybersecurity breaches in financial institutions. Financial organizations should invest in ongoing education for both employees and customers about cybersecurity best practices.

  1. The Role of IT Audits in Enhancing Cybersecurity

Regular IT audits play a critical role in identifying potential vulnerabilities and ensuring that financial institutions remain compliant with evolving cybersecurity regulations. An effective IT audit can assess key areas such as access management, incident response readiness, and data encryption protocols, providing actionable insights to strengthen cybersecurity frameworks.

At Brady Martz, we specialize in IT audits tailored to the unique needs of financial institutions, helping them uncover vulnerabilities and implement solutions to mitigate risks proactively.

  1. Staying Ahead of Cybersecurity Trends

As cyber threats evolve, financial institutions must continuously adapt to emerging trends and technologies. In 2025, cybersecurity trends in the financial sector will likely include:

  • AI and Machine Learning in Cybersecurity: Using AI and machine learning to predict and detect cyber threats faster and more accurately.
  • Zero-Trust Security Models: Adopting zero-trust principles where no user or system is trusted by default, regardless of whether they are inside or outside the network.
  • Cloud Security: Ensuring that cloud infrastructure is secure, as more financial institutions shift to cloud-based services.

Mitigating cybersecurity risks in the financial sector is an ongoing, dynamic challenge that requires vigilance, advanced technology, and a commitment to continuous improvement. By implementing these best practices, financial institutions can better protect themselves from cyber threats in 2025 and beyond, ensuring the security and trust of their customers and maintaining a competitive edge in a rapidly evolving digital landscape.

At Brady Martz, we’re here to support your financial institution’s cybersecurity efforts with IT audits that provide the insights you need to strengthen your systems and safeguard sensitive data. Contact us today to learn how we can help your organization stay ahead of the cybersecurity curve in 2025.