Small business of-interest. Good read
Excerpt: PwC commissioned independent research firm BSI Global Research Inc. to interview 243 chief executive officers (CEOs/CFOs) of leading privately held US businesses in the second quarter of 2012. The interviewees were asked about their current business performance, the state of the economy, and their expectations for business growth over the next 12 months. We then compared their responses with the prior quarter’s results to see how the outlook has changed.
Read full article via Trendsetter Barometer — Business Outlook Report — The Harvard Law School Forum on Corporate Governance and Financial Regulation.
Small business of-interest and news-to-watch. A study with findings from the CFO side is believed to provide better insights into the issues and a probable fix.
Excerpt: Our findings raise a host of possible directions for future research. Here we only discuss a few broad themes, with more specific suggestions given at appropriate places later in the paper. One broad direction is increased attention to the sustainability of earnings, and the inter-temporal relation between earnings and cash flows. Another broad direction is closer attention to the role of standard setting in the determination and quality of earnings. Our survey suggests that standard setting has a first-order effect on the utility of earnings but there is a relative paucity of research that examines this connection. In addition, the evidence leaves little doubt that there is a sharp dissonance between standard setters’ and CFOs’ views on the proper determination of earnings, e.g., the roles of matching and fair value accounting. Research can help to bridge this gap, and more generally these are issues that go to the heart of accounting and affect much wider constituencies, so this is an area with much potential for significant work. Finally, there is considerable potential for further research into the detection of opportunistic earnings management, a topic of much interest to investors, auditors and regulators
Read full article via Earnings Quality: Evidence from the Field — The Harvard Law School Forum on Corporate Governance and Financial Regulation.
Small business heads up — know your responsibility and consequences.
Excerpt: The case demonstrates that even those CFOs who do not sign the tax returns themselves may become liable for the signer’s failure or inability to pay taxes. In general, responsible corporate officers and counsel who willfully fail to pay payroll taxes become personally liable for the taxes. While many business owners are stuck paying corporate payroll taxes out of their own pockets, a few also wind up going to jail for their failures to pay
Read full article IRS payroll tax Jenkins Dialogue Diaspora Trust Fund Recovery Penalty. From CFO.com
Human resources management accounting and finance teams.
Excerpt: Top CFOs know they are only as strong as their teams. From treasury to financial planning and analysis, their finance managers have a shared vision of being valued contributors in strategic discussions – adding insight and analysis at critical junctures of decision-making. How can CFOs attract, retain, and motivate finance talent to be much more than number-crunchers?
PwC and faculty at Wharton share insight on how top finance organizations can rise to the challenge.
Read introduction and download full pdf via PwC & Wharton focus on how CFO’s can build top-performing finance teams: PwC.
A good question and some answers for everyone … article also includes some how-to measure needs to expected results.
Excerpt: Making the business case for an accounting or HR system is clear-cut: Avoid unnecessary costs, manage cash better, reduce risk and you’re done. If you were to invest twice as much in one of those systems, you might increase business payoff by 20 percent, so you can find the optimization point for ROI in a single spreadsheet.
With a manufacturing systems, the extra payoff from investing in all the fanciest supply-chain add-ons, such as constraint-based production scheduling and inventory optimization, just isn’t there for most businesses. For both the CIO and the CFO, these systems are easy to think about–the data is hard to debate, and the outcomes are pretty much black and white.
Then there’s the CRM system. To misquote Tom Lehrer, “Life is like a CRM system: What you get out of it depends on what you put into it.”
Read full article via How Much Should You Spend on CRM Software? | CFOworld.
Here is good advice. The push to more and better measurements can sometimes backfire without better knowledge of just what we are seeing and what it means in the whole of the picture.
Excerpt: CFOs are keenly aware that while the popularity of the term “predictive analytics” is relatively new, the concept is really nothing revolutionary. Predictive analytics is often described as data mining or advanced analytics that, as a concept, has existed for a long time. The only difference now is the abundance of technologies, tools and applications in the marketplace to analyze the large amount of data available.
This proliferation has pushed some finance executives to immediately utilize the tools without first understanding their available data and devising a proper strategy that allows the organization to truly benefit from predictive analytics.
Read full article via Predictive Analytics: Look Before You Leap into an Implementation – Information Management Newsletters Article.
Important read. Detailing the extensions proposed on corporate regulations, namely CFO role. Leadership, management and board of directors
Excerpt: Self-proclaimed shareholder advocates have extended Sarbanes-Oxley reforms deeper and deeper into the business. Now some are going too far, pushing those regulations into areas that intrude on effective corporate administration. The latest and most misguided attempt to “improve” corporate governance in this way comes from Nell Minow, founder of the corporate-risk rating firm, GMI Ratings, who was recently quoted in The Wall St. Journal arguing that CFOs should report directly to the audit committee of the board.
Not “report regularly.” Not “report in executive session, without the presence of the CEO.” Both of these are common enough practices today. No, Minow is suggesting that CFO essentially work for the audit committee. As she puts it, when she’s evaluating a company, “the most important thing I look for in a CFO is someone who reports directly to the audit committee, because what I want is a CFO who is absolutely clear that his or her job depends on telling the truth to the board.”
There are four main problems with her proposal.
Read full article via Keep Your Sarbanes-Oxley Off My CFO – Bob Frisch – Harvard Business Review.
Good read. Many CFOs are confronted with new roles and whether by design or by default are not quite up to the tasks at hand.
Excerpt: … based on more than 100 CFO Transition Labs, we find many CFOs who aspire to the catalyst role are ill equipped to go beyond the numbers and effectively drive change that improves future company performance.
This issue of CFO Insights examines sources of resistance to change and provides some practical tools for CFOs to diagnose and navigate change efforts more effectively
Read introduction and download paper via Deloitte | Navigating change | CFO Insights | Finance transformation |Change management.
This is an interesting read. There is the talk and plan strategy and then there is the real world. What do you think?
Excerpt: On the seemingly endless list of skills and traits that synthesize into an effective finance chief, a case can be made that one stands out for its potential to make or break a career: solid prioritization. A sizable part of that je ne sais quoi we call “vision” could be described as a sense of what activities will render the most value for the organization.
But is prioritizing the same as strategizing? Not according to what some CFOs told Ernst & Young, which recently conducted in-depth interviews with 19 of them at companies throughout the Americas. While they agreed overall with the common view that they and their peers are and should be growing ever-more strategic, several argued for other, higher priorities.
Read full article via Ernst Young OfficeMax Besanko Moles Nike Campion Ragauss Delta Maestri Xerox Motorantim Prignolato. From CFO.com
More well written insight into the evolving role the CFO plays in today’s business. The study was conducted by Ernst & Young.
Excerpt: A major insight from the study indicates that CFOs are no longer expected to merely execute the business strategy handed down from the CEO and board of directors. Instead, they are increasingly being asked to develop strategy in existing and emerging growth markets while managing the ongoing demands of the finance function role. In turn, some CFOs believe their role is evolving from serving as a “chief skeptic officer” to a “chief growth officer” as they become major participants in the conversation about growth and business strategy.
Read full article via CFOs Get More Involved in Setting Strategy for CEOs. From Accounting Today
Recommended read — discussions and information addresses today….what has been learned and changed as the CFO role adapts and changes…leadership and management
Excerpt……Their insights were particularly timely. As companies navigate the increasingly complex waters of the global marketplace, CFOs are becoming a more influential part of the strategic-planning process.
Read full article….via CFO round table: Managing uncertainty. From AICPA Journal of Accountancy
There are still gains to be had with attention to the basics…..here is a reminder of what you should be doing …… Accounting
Excerpt……Over the past three years, CFOs developed a fine taste for productivity gains. And my most recent research shows they are looking for more 1. Surprisingly, some are turning, once again, to the basic transaction-oriented processes such as accounts receivable (AR) and accounts payable (AP). Why? Haven’t these processes already been made as slick as can be?
APQC’s Open Standards Benchmarking shows that, indeed, there are ample opportunities to reduce costs. Let’s look at AR, for example.
Read full article and download full paper here……via Accounts Payable and Receivable: Companies Still Don’t Get it | Proformative.
Small business takeaways……. global interests and heads-up
Excerpt……Multinational CFOs are increasingly looking to avoid the double taxation that can occur from selling a product in one jurisdiction when it is manufactured in another. Transfer pricing, or the movement of goods and services in order to allocate profits, has become a high-ranking concern for CFOs, according to a survey by Alvarez & Marsal Taxand, an affiliate of Alvarez & Marsal advisory firm.
Read full article…..via double taxation transfer pricing multinationals. From CFO.com
An update on the GAAP for small business / private company .. and news-to-watch.
Excerpt……CFOs and their tax departments at privately held companies will no longer be faced with the difficult and costly task of applying public accounting standards to their situations. The Financial Accounting Foundation (FAF) today established a new council to improve standard setting for private companies.
Read full article……via private company accounting GAAP FASB AICPA FAF. From CFO.com
Here is your May 2012 digital edition of CFO Magazine….. usually great articles…… I will look forward to browsing ..
CFO Magazine May 2012. From CFO.com