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

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

Good grooming.(from the editor)
November 1, 2007... HERE'S A CONUNDRUM: 83 percent of CFOs have not named a successor, yet nearly half of CFOs are promoted from within. So why don't more companies systematically develop their in-house finance talent? According to a survey by Robert Half...

Accounting for Indian lands.(letters)(Letter to the editor)
November 1, 2007... [ILLUSTRATION OMITTED] The historical accounting in the Cobell case is being performed by the Office of Historical Trust Accounting, which reports to the Special Trustee. The Office of the Special Trustee for American Indians (OST) assists...

Second-tier benefits.(letters)(Letter to the editor)
November 1, 2007... As a commercial real estate adviser, I found the subject of your October Insight ("If You Build It, Will They Come?") intriguing and the analysis spot-on. Emerging collaboration tools and rapidly accelerating communications infrastructure are...

Health care is local.(letters)(Letter to the editor)
November 1, 2007... "Critical Condition" (September) is an understatement in describing the plight of national hospital chains. Let's face it: health care is local, because to be in touch with the local community and its needs, the decisions and the...

Innovators' dilemma.(PATENTS)(Letter to the editor)
November 1, 2007... NEW PATENT LAWS THAT GO INTO EFFECT this month are ostensibly designed to cut down on frivolous filings and a crushing applications backlog, but critics say they may have a chilling effect on innovation. Previously, any person or company...

Bitter medicine.(SUPPLY CHAIN)
November 1, 2007... [ILLUSTRATION OMITTED] IN AN EFFORT TO CURTAIL DRUG COUNTERFEITING, some 21 states have passed "pedigree" Legislation--laws that require the documentation of how drugs pass through the supply chain to the retailer. Much to the dismay of...

Lights, camera, audits!(STAFFING)
November 1, 2007... [ILLUSTRATION OMITTED] EVEN THOUGH THE INCREASING NUMBER of accounting graduates--up 19 percent from 2000 to 2004, according to the American Institute of Certified Public Accountants--should go a long way toward helping accounting firms...

Losses jump, spending doesn't.(COMPUTER SECURITY)
November 1, 2007... A snapshot of the latest Computer Security Institute survey findings on computer crime shows that the average toss per company suffering a breach is up substantially after several years of decline, but spending, white up slightly in dollar...

China's next miracle?(BANKING)
November 1, 2007... BARRED FROM U.S. SHORES FOR 15 YEARS, China's banks may soon reestablish a beachhead here. As summer ended, the Federal Reserve was evaluating applications from China Merchants Bank and Industrial and Commercial Bank of China (ICBC) to open...

How low can they go?(E-PROCUREMENT)(managing online auctions)(Brief article)
November 1, 2007... [ILLUSTRATION OMITTED] Wonder whether your suppliers are truly giving you a good deal? Two professors who study online reverse auctions (in which buyers solicit bids and award their business to the low bidder) have devised a mathematical...

See you at the office.(TELECOMMUTING)
November 1, 2007... [ILLUSTRATION OMITTED] TEN YEARS AGO, SUE SACHDEVA BECAME the first CFO ever quoted in these pages on the subject of telecommuting. She offered a strong endorsement of the concept, in no small part because by telecommuting she was able to...

Virtual agreement.(MANAGEMENT)(workin of virtual teams)(Brief article)
November 1, 2007... [ILLUSTRATION OMITTED] TEAMWORK ISN'T ALL it's cracked up to be, especially when the task at hand demands creativity. Research has shown, for example, that people working individually on a creative task will outperform the same number...

Stuck in a rut: despite years of investing in IT, outsourcing, and process improvements, finance departments still spend too much time on routine tasks.(by the numbers)
November 1, 2007... FINANCE EXECUTIVES HAVE LONG WANTED to play a more strategic role in their companies, to serve as multifaceted business advisers instead of one-dimensional number-crunchers. Companies have invested in technology and offshore operations to...

View from Asia: charity begins at home for Indian companies that want to expand the domestic market.(top line)
November 1, 2007... Businessmen cannot be philanthropists;' says Krishna Kant Rathi, CFO of Pantaloon, a big Indian retailer. "Our concern is profits" Absolutely, but Indian companies-including Pantaloon--see a benefit in positioning themselves as helpers to the...

Group therapy: groupthink can result in spectacularly bad decisions, but the malady can be prevented.(insight)
November 1, 2007... A plane crashes in the desert and six survivors are left to choose what items to salvage. Should they take a gun? Salt tablets? Heavy overcoats? How about a cosmetics mirror? With 15 possibilities and limited time to make their choices, the...

The host with the most: SAP boldly goes where a number of other software vendors have already gone.(in tech)
November 1, 2007... At the September unveiling of SAP's latest product offering--a hosted application aimed at midsize businesses--company officials extolled the virtues of rented software. "Globalization and digitalization are creating a new world of business;'...

Wireless transfer.(NETWORKING)
November 1, 2007... It's just a box, a little red box. But soon, that little red box may change how banking is conducted. Known as "CryptoVue," the biometric encryption system enables banks to conduct a wide range of financial transactions and data-processing...

Buying American: as Middle Eastern and Asian industrial powers supplant private equity as acquirers of U.S. companies, some targets gain advantage.(deals)
November 1, 2007... NASDAQ STOCK MARKET INC. was having trouble going global. For more than a year it had courted the London Stock Exchange, amassing a 31 percent stake before being rebuffed in a bid for a full-fledged merger. Last May Nasdaq changed course,...

Delta Air Lines: Edward Bastian.(ON THE RECORD)(Interview)
November 1, 2007... DELTA AIR LINES HAS ENCOUNTERED its fair share of turbulence this year. The nation's third-largest carrier not only spent the first quarter of 2007 in Chapter 11, it also had to thwart a $9.5 billion hostile-takeover bid from US Airways Group...

Who's next: succession planning should be a critical exercise in finance. Too bad so many companies avoid it.
November 1, 2007... WHEN OREN SHAFFER RETIRED FROM HIS POST AS CFO AT Qwest Communications earlier this year, controller John Richardson became the new finance chief. Assistant controller Bill Johnston took Richardson's old job, internal-audit head Pat Halbach...

The essential skills: to ascend to (and remain in) the CFO's office, you need much more than financial acumen.(Chief financial officers must have best personality traits)
November 1, 2007... No one becomes a CFO without possessing the commensurate finance skills. No one thrives as a CFO, however, without having much more. As Scott Simmons, vice president of Crist Associates, a Chicago-based recruiter, puts it: "No company wants...

The cash trap: cash may be a comfort in an uncertain economy, but it can also be a drag on shareholder value.
November 1, 2007... [ILLUSTRATION OMITTED] From 1995 to 2002, Terex Corp. was a terror on the mergers-and-acquisitions scene, snapping up a string of 22 takeover targets. Since then, the Westport, Connecticut-based manufacturer of construction and mining...

Debt in disguise: the boundaries between receivables securitizations and loans are blurring.(in practice)
November 1, 2007... [ILLUSTRATION OMITTED] Why does WESCO International Inc. use accounts-receivables securitization, a form of financing so closely linked to the subprime-mortgage meltdown? "Because we can," says senior vice president and CFO Stephen Van...

Fourth and goal: to buff up their fourth-quarter numbers, companies often play games with working capital. Unfortunately, the shine doesn't last, according to REL's Year-End Gamesmanship Scorecard.(working capital)(stastical representation of companies financial report)(Statistical table)(Financial report)
November 1, 2007... Let the games begin. The working capital games, that is. Right now, companies all over America, in every industry, are beginning a dash for cash. If past is prologue, many companies will go to great lengths to slash their working capital in the...

Can this retirement be saved? When spouses disagree about when, where, and how to retire, each may wonder just what they were working for all those years.(your money)
November 1, 2007... WHETHER YOU ARE CONTEMPLATING retirement in the near term or further down the road, you've no doubt run plenty of numbers, from asset-allocation percentages to investment returns to vesting schedules. Maybe you've even taken a guess at your...

What goes around.(grapevine)
November 1, 2007... [ILLUSTRATION OMITTED] IN HIS HEYDAY, Bill Lerach was so ruthless a class-action lawyer that in Silicon Valley his name was synonymous with being sued. Now Lerach is being "Lerached" himself--to the great delight of much of the corporate...

Farewell to a finance Whiz.(grapevine)
November 1, 2007... The world of finance lost a legend this past October when former Ford Motor Co. CFO J. Edward Lundy died at the age of 92. Lundy was one of the 10 "Whiz Kids" who were credited with pulling the auto company out of a 15-year profit slump...

The road ahead.(20/20 view on managing pension liabilities)
November 1, 2007... THERE WAS A TIME WHEN THE JOURNEY toward a financially secure retirement ran straight and smooth, both for employers and employees. Companies offered generous pensions to nearly all workers, and most workers logged many years of experience with...