CFO, The Magazine for Senior Financial Executives articles from February 2007

CFO, The Magazine for Senior Financial Executives archives from February 2007

Let there be light.(health-care costs)(Editorial)(Brief article)
February 1, 2007... SUNLIGHT IS A GREAT DISINFECTANT, and for six years now the SEC, the PCAOB, and FASB have been laboring to shine more light into the shady corners of financial reporting and compensation. Slowly, painfully, and at great cost, public companies...

Native American facts and fiction.(letters)(Letter to the editor)
February 1, 2007... Your recent article about Native American gaming ("The 5cents Empire," December 2006) inaccurately portrayed the current law on taxation of "sovereign" Indian nations. According to your article, "[Arnold] Schwarzenegger ran television...

Capital-market shortcomings.(letters)(Letter to the editor)
February 1, 2007... "Management or Manipulation?" (By the Numbers, December 2006) concisely demonstrates a shortcoming of capital markets: the incentive [to focus on] performance management rather than [properly] manage the performance of operating, investing, and...

Reform effort rebuked.(REGULATION)(Committee on Capital Markets )
February 1, 2007... TO ANYONE WHO HAS EVER GRUMBLED about shareholder lawsuits or Sarbanes-Oxley, last fall's debut of the Committee on Capital Markets Regulation should have been welcome. Comprising 22 members from the worlds of business, law, and academia, the...

Curing spring fever.(BENEFITS)
February 1, 2007... AS FLU SEASON approaches its peak, employers beware: sick days may affect the bottom line more than usual. A survey by CCH found that in 2006 unscheduled absenteeism among employees reached its highest rate since 1999. Large companies are...

Adieu to AS2?(AUDITING)(Accounting Standard No. 2)
February 1, 2007... AFTER TWO YEARS OF COMPLAINING about Accounting Standard No. 2, finance executives may finally get some relief. Last December, the Public Company Accounting Oversight Board (PCAOB) proposed repealing the much-maligned rules for auditors...

Not invented here.(KSR International)(Brief article)
February 1, 2007... A SEEMINGLY MUNDANE DISPUTE over gas-pedal design may result in a Supreme Court decision that would invalidate patents deemed too "obvious." And that may be bad news for, among others, companies that rushed to patent E-commerce business...

Phoning it in.(ETHICS)(Brief article)
February 1, 2007... WHAT'S THE BEST WAY FOR AN EMPLOYEE to blow the whistle on fraud or related infractions? The most popular way seems to be via hotlines or similar reporting tools. According to a joint report from the CSO Executive Council, an organization of...

"How'm I doing?".(PERFORMANCE)
February 1, 2007... WHAT YOU THINK about performance reviews may depend on which side of the desk you sit. When Salary.com surveyed 2,000 employees and 330 human-resources professionals, it found that while two-thirds of companies believe their performance reviews...

Ignorance is a defense.(LAW)
February 1, 2007... DIRECTORS AROUND THE COUNTRY sighed with relief late last year when the Delaware Supreme Court ruled for the defense in Stone v. Ritter, a lawsuit involving director liability at AmSouth Bancorporation. The court clarified its views on director...

Fear of FIN 48.(TAXES)(interpretation no. 48)
February 1, 2007... IN JANUARY, THE FINANCIAL ACCOUNTING STANDARDS BOARD surprised businesses by refusing to delay issuance of FIN 48, an attempt to clarify how companies account for uncertain tax positions on their financial statements. The guidelines, effective...

Planning for the best: a focus on budgeting signals better performance than a focus on controls.(by the numbers)
February 1, 2007... DOES YOUR FINANCE ORGANIZATION focus on budgeting and planning, or cost management? While the two are not mutually exclusive--the best firms focus on both--emphasizing one over the other could have a dramatic impact on the overall effectiveness...

View from Europe: corporate Europe is showing why the cost of combating global warming may be less than the cost of ignoring it.(top line)
February 1, 2007... JORDON BOYD DOESN'T see eye to eye with a lot of other CFOs. That's because the finance chief of Drax, a UK power generator, is a fan of the European Union's Emission Trading Scheme (ETS). The two-year-old mandatory program aims to mitigate...

Crossing over: the next big things in business technology? Ask your kid.(in tech)
February 1, 2007... TWO YEARS AGO, CFO hired a new IT employee, an under-25 staffer who sat in an open cubicle. Due to the placement of his desk, the employee's work habits were easily observed by colleagues. We watched with quiet amusement as this scion of...

An IPO resurgence? Private equity is helping to stoke the fire even as it offers a solid alternative to going public.(deals)
February 1, 2007... SINCE THE BURSTING OF THE IPO bubble early in the decade, young companies have had to reconsider the viability of an initial public offering. Certainly, would-be investors have set the bar significantly higher in the past several years, making...

The Hartford's David Johnson.(ON THE RECORD)(Interview)
February 1, 2007... EXAMINE THE CAREER OF DAVID JOHNSON and you begin to think that timing may not be his strong suit. In 1998, the former Merrill Lynch investment banker signed on at Cendant Corp., a company he had helped take public years earlier. Within months,...

Water for profit: undaunted by tight regulations and huge infrastructure costs, companies are diving into the water business.
February 1, 2007... WHEN MOST CFOs think about liquidity, they're calculating how fast they can turn assets into cash. But Aqua America finance chief David Smeltzer is just as likely to be concerned about how smoothly water is flowing through the 10,000 miles of...

Financing the chain: as new services come to market, finance executives are taking a second look at supply-chain finance.
February 1, 2007... With thousands of suppliers shipping everything from furniture to toys to its 1,400 stores, Big Lots Inc. has tong prided itself on its supply-chain management. But until recently, the closeout retailer had a few weak links in what might be...

The other stakeholder: new thinking about rank-and-file pay, health care, and workplace disputes is reshaping employee/ employer relationships.(HUMAN CAPITAL)
February 1, 2007... Workers of the world, hold tight. The delicate balance that has long marked the employer-employee relationship is becoming even more fragile. The tight labor market and improving economy have made workers--especially the good ones--more...

The enemy within: companies fear employee lawsuits more than any other legal threat. To prevent them, experts advise looking in the mirror.(HUMAN CAPITAL)
February 1, 2007... Emily Grothe was floored when she heard that a former partner at her energy consulting firm was suing her and the company for, among other things, violation of the Family and Medical Leave Act and the Americans with Disabilities Act. The...

Pin the tail on the doctor: a dearth of information leaves health-care consumers in the dark.(HUMAN CAPITAL)
February 1, 2007... Consumer-driven health plans may not be the worst way to moderate escalating health-care costs, since they bring a strong measure of free-market principles to an arena largely removed from market forces. [paragraph] It works like this:...

Just rewards: pressured by the tight labor market, companies are redesigning nonexecutive pay to attract--and keep--top performers.(HUMAN CAPITAL)
February 1, 2007... When Xcel Energy wanted to reward its rank-and-file for taking the initiative, it created Xpress Ideas, a rewards scheme that pays bonuses on the spot for useful suggestions. The program has been a hit among the company's 11,000 workers; last...

The other facts of life that birds-and-bees talk you're bound to have with the kids may be easy compared to the delicate matter of wealth and how to handle it.(your money)
February 1, 2007... JIM McConnell had a dilemma: he wanted to share his wealth with his children, but he didn't want the money to lead them astray or sap their will to succeed on their own. He's far from alone. Currently, about 2.7 million Americans have at...

Parting shots: why the views of departing employees can be the key to higher retention.(Your move)
February 1, 2007... WANT THE INSIDE STORY on your finance department? Ask the people who are quitting. Vince Cook, CFO of home health-care provider AccentCare, does exactly that by reading the transcript of every exit interview conducted with a finance employee....

Songs in the key of sarbox.(grapevine)(Steven Zelin)
February 1, 2007... IF AUDITS, merger negotiations, or FASB rulings don't put a song in your heart, maybe Steven Zelin can. Calling himself "The Singing CPA" the 31-year-old internal auditor at French investment bank Societe Generale in New York is putting a new...

New face at FEI.(grapevine)(Financial Executives International)(Brief article)
February 1, 2007... There's not much in finance that Michael P. Cangemi has not done. He's been a CFO, a CEO, and a CIO, and has authored numerous books on auditing. (In fact, a collection of more than 250 of his books on auditing and EDP auditing is even housed...