CFO, The Magazine for Senior Financial Executives articles from September 2003

CFO, The Magazine for Senior Financial Executives archives from September 2003

Bonus babies.(2003 Compensation Survey)(Brief Article)
September 1, 2003... Ignore the uproar over executive salaries: our annual compensation survey shows that CFOs made out just fine last year. Stock-option grants fell off, but jumbo bonuses helped boost the average total comp of finance chiefs by 21 percent. Which...

BPO buyer's guide.(Business Process Outsourcing)(Brief Article)
September 1, 2003... The outsourcing of business processes may be a money-saver, but it's not without pitfalls. In the feature story of our buyer's guide, contributing editor Russ Banham looks at how some U.S. companies are managing those risks. The guide also...

Your finance department is first-rate.(Ten Sure Signs)(Brief Article)
September 1, 2003... When it comes to self-awareness, CFOs are often flying blind. Sure, they know how their own finance team operates. And most zealously track numbers like DSO. But as assistant editor Lisa Yoon notes, numbers don't necessarily tell the tale....

Slogging it out.(from the editor)(Brief Article)
September 1, 2003... WE WON'T REALLY KNOW THE CONSEQUENCES OF financial-reporting reforms until they are tested in the next bull market. (May it begin soon.) What we do know is that the actions of Congress, market authorities, and regulators to restore investor...

Speaking out on audits.(letters to the editor)
September 1, 2003... I FIND IT INTERESTING THAT THE PUBLIC accounting profession is so defensive that it is playing the semantics game of "reasonableness" versus "fraud" ("How Audits Must Change" July). Are they saying that the significant accounting changes at...

Boss time.(letters to the editor)
September 1, 2003... I RECENTLY PUBLISHED AN ARTICLE called "I've Never Met a Bad Boss," which mirrors what Christine Cox, CFO of MetraTeeh Corp., had to say about learning more from bad managers than from good (Your Move, "Lasting Advice," July). In my case,...

Goodwill at a good price.(letters to the editor)
September 1, 2003... I ENJOYED YOUR ARTICLE REGARDING goodwill and the implications of FAS 141 and 142 (New Deals, "Goodwill to All Pieces," July). As the chairman of the valuation group for Clifton Gunderson LLP, one of the largest valuation groups in the country,...

Dealing with the debt.(letters to the editor)
September 1, 2003... GOOD JOB ON YOUR ARTICLE "SECOND Acts" (June). I've been managing midsize Chapter II companies on behalf of debtors for 30 years. From my perspective, the biggest reason that a high percentage of confirmed plans ultimately fail or require...

All in the ESOP family.(letters to the editor)
September 1, 2003... YOUR ARTICLE ON EMPLOYEE STOCK ownership plans ("Split Personality," June) was both timely and stimulating. Because the thrust of your article concerned public companies, which have no stock-liquidity problem, as contrasted with privately owned...

Windows into valuation.(Stock Options)
September 1, 2003... MICROSOFT CORP'S July announcement that it would stop issuing employee stock options--and expense all existing equity compensation, including stock grants--represents a huge break from the rest of the technology industry. But if anything, the...

Ticker tales.(newswatch)(Brief Article)
September 1, 2003... When word leaked out in late July that the Pentagon was working on a plan to create a futures market on the likelihood of such events as a terrorist attack, criticism was so harsh the plan was scrapped the next day. The idea was that...

Ballots over board ways.(Corporate Governance)(Brief Article)
September 1, 2003... IF NEW Securities and Exchange Commission chairman William Donaldson gets his way, shareholders could have a lot more say in how companies are run, and who runs them. The SEC issued a proposal in August that would dramatically change the...

Home rules.(Employment Law)(Brief Article)
September 1, 2003... A RECENT DECISION by a New York state court could have a wide-ranging impact on the nation's 32 million telecommuters and their employers. In July, the New York State Court of Appeals ruled that a woman who had worked for a New York...

The never-ending story.(Health Care)(Brief Article)
September 1, 2003... Two new studies confirm what CFOs already feared: health care cost increases will continue to soar through 2004. One forecast, by insurance brokers and consultants Aon Corp., estimates that health-plan rates will rise by more than 14...

The advocate.(Ten Questions)
September 1, 2003... COLLEEN SAYTHER, who took over as president of Financial Executives International in March, comes to the professional association at a turbulent time for senior financial executives. FEI, with 15,000 members and 85 chapters, hasn't been as...

Getting out the float.(Banking)
September 1, 2003... THE AVERAGE PAPER CHECK now logs an astounding number of miles as it travels back to its originating bank for verification after it is cashed. The trip affords cash-strapped companies a few extra days between writing the check and ponying up...

What's in a name?(Reform Update)
September 1, 2003... Along with current efforts to solidify controls and revamp questionable policies, some companies have engaged in a bit of window dressing in their attempt to regain investor trust. A case in point: the recent proliferation of corporate...

GM pulls a fast one.(Debt Market)(Brief Article)
September 1, 2003... WHEN GENERAL MOTORS CORP. summoned 55 investment bankers from 16 firms to the cafeteria of its Fifth Avenue office this past June--and piped in dozens more on speakerphone--it was clear the company had something big in mind. And it wasn't...

A little more secure.(Security)
September 1, 2003... The United States doesn't calculate how much Corporate America spends for homeland security--as stunning shortcoming, given that more than 80 percent of the infrastructure is in private industry's hands. And little of the neatly $40 billion in...

Are we there yet?(Global Confidence Survey)
September 1, 2003... PREPARE THE BULLS: CFOs are feeling better about the outlook for the U.S. economy. While few are ready to declare the downturn over just yet, most are increasingly optimistic. In fact, finance chiefs are more hopeful about economic prospects...

Two years later, still adrift? After 9/11, business continuity got plenty of attention, but many companies remain ill-prepared for disaster.(techwatch)
September 1, 2003... IN THE WEEKS FOLLOWING SEPTEMBER 11, 2001, the New York Board of Trade (NYBOT) was praised, in these pages and elsewhere, for having invested in a disaster recovery plan that proved nearly priceless. The commodities exchange had been spending...

Re-reengineering.(Business Processes)
September 1, 2003... TWO YEARS AGO, LexisNexis realized that its ability to serve new Web-based customers was severely strained. Thousands of small and midsize law firms represented a huge business opportunity for the company's legal-information services, but they...

Doubly blessed? Integrating HP and Compaq may have been the easy part. Can it now beat Dell and IBM at their own game?(new deals)
September 1, 2003... WHEN THE IDEA of combining Hewlett-Packard Co. and Compaq Computer Corp. first came up, HP chief financial officer Robert Wayman was skeptical. "I assumed we'd study it for two weeks and move on," he says. "In this industry, there's virtually...

Mold spreads: suits over health effects from mold increase corporate exposure, especially singe coverage is scarce.(Spotlight: insurance)
September 1, 2003... ONCE UPON A TIME, mold was a problem at work only if you avoided cleaning the office refrigerator for too long. Lately, though, it's becoming the hottest topic in property/casualty insurance, as lawsuits claiming health-related damages from...

Sticker shock: the true cost of Sarbanes-Oxley compliance.
September 1, 2003... Bill Teuber prickles a bit at the notion that the landmark Sarbanes-Oxley legislation has forced major reforms within EMC Corp. "I think about internal controls all the time; I didn't need the law to get me to think about them," says the CFO of...

A two-day conference total working capital management: strategies and tactics for sustainable improvement.
September 1, 2003... * SEPTEMBER 28-30, 2003 * THE PLAZA HOTEL, NYC YOU KNOW HOW TO BOOST CASH FLOW IN A CRISIS. Now, discover how to liberate fresh cash from operations in good times and bad by continuously reducing your working capital requirements. ...

Good to rate? It's not clear what went wrong at the rating agencies--or how to fix it.(Credit Ratings)
September 1, 2003... Sean Egan does not mince words. In letters to Congress and in interviews, the president of credit-rating agency Egan-Jones Ratings Co. compares his competition to "thugs" and "criminals." In a formal filing with the Securities and Exchange...

Barely working: companies squeezed more cash from their businesses this year--but not much.(The 2003 Working Capital Survey)
September 1, 2003... MAYBE THEY WERE PREOCCUPIED with governance issues. But whatever the reason, U.S. companies blew some good chances last year to generate extra cash via working capital improvements. That's the primary conclusion of CFO's annual working capital...

The 2003 working capital survey.
September 1, 2003... The 2003 Working Capital Survey DSO Company 2002 QUARTILE CHANGE AEROSPACE & DEFENSE GENERAL DYNAMICS (a) 29 (a) 1...

Has the world of risk really changed? A commentary from FM Global.(2003 Managing Business Risks: protecting value study)
September 1, 2003... The world has changed in countless ways in the past 24 months. Words like "terrorism" and "corporate scandal" have entered mainstream vocabulary. The public suddenly has a sharper perspective on risk--and believes that the world is a much...

Containing terrorism: federal antiterrorism programs have spurred a sea change in supply-chain security.(Special report: SCM)
September 1, 2003... EVERY YEAR, SHIPS from abroad deliver more than 7 million cargo containers to America's seaports. Framed in steel, standard oceangoing containers typically come in 20-and 40-foot lengths and can carry payloads weighing up to 60,000 pounds. They...

Compromising positions: will credit derivatives encourage more lending, or harm the interests of borrowers?(banking)
September 1, 2003... IF YOU'RE UNFAMILIAR WITH CREDIT derivatives, it's time to get acquainted, as bank are using these financial instruments more often. Credit derivatives--or swaps--make it possible for banks to limit their credit exposure without selling...

Stopping the flow: turns out, keeping hackers out isn't as much of a problem as keeping data in.(security)
September 1, 2003... LAST OCTOBER, A REUTERS REPORTER noticed that Swedish software company Intentia used nearly identical URLs, or Web-page addresses, when posting its first- and second-quarter financial results to the Web. Following the pattern, the reporter...

Lessons learned.(CFO Portfolios)
September 1, 2003... LIKE MANY INVESTORS, ED GOLDFINGER, CFO OF EMPIRIX Inc., in Waltham, Massachusetts, got "a bit overexcited" during the dot-com frenzy. And while he doesn't consider himself to have been "burned very badly," he says the experience taught him...

William Aylesworth will retire as CFO of Texas Instruments Inc. at the end of the year.(CFOs On The Move)(Brief Article)
September 1, 2003... William Aylesworth will retire as CFO of Texas Instruments Inc. at the end of the year. He will be succeeded by Kevin March, controller at the Houston semi-conductor company.

Maytag Corp.(CFOs On The Move)(Brief Article)
September 1, 2003... George Moore is the man for Maytag Corp. He was appointed CFO of the Newton, Iowa, appliance company. Moore replaces Steven Wood, who left to pursue other interests.

Universal Health Services Inc.(CFOs On The Move)(Brief Article)
September 1, 2003... Universal Health Services Inc. hired Steve Filton as CFO. He fills the spot vacated by Kirk Gorman, who resigned after a dispute with auditor KPMG. Filton was formerly controller at UHS.

Doing time?(grapevine)
September 1, 2003... When will we know if Enron Corp.'s Andrew Fastow is going to walk free or head up the river? No time soon, if the case of Paul Polishan is any indication. If you don't remember Polishan, don't worry. It's been more than 10 years since the...

All accounted for.(grapevine)(Brief Article)
September 1, 2003... The accounting community has a new sheriff: Donald Nicolaisen, appointed chief accountant at the Securities and Exchange Commission in August, is expected to assume the role later this month. Nicolaisen joins the SEC from...

BPO buyer's guide.(Business Process Outsourcing)
September 22, 2003... The outsourcing of business processes may be a money-saver, but it's not without pitfalls. In the feature story of our buyer's guide, contributing editor Russ Banham looks at how some U.S. companies are managing those risks. The guide also...

Your finance department is first-rate.(Ten Sure Signs)(Brief Article)
September 22, 2003... When it comes to self-awareness, CFOs are often flying blind. Sure, they know how their own finance team operates. And most zealously track numbers like DSO. But as assistant editor Lisa Yoon notes, numbers don't necessarily tell the tale....

Bonus babies.(2003 Compensation Survey)(Brief Article)
September 22, 2003... Ignore the uproar over executive salaries: our annual compensation survey shows that CFOs made out just fine last year. Stock-option grants fell off, but jumbo bonuses helped boost the average total comp of finance chiefs by 21 percent. Which...

SEC review.(Webcasts)(Brief Article)
September 22, 2003... Revised regulations? New accounting standards? Evolving technologies? Join your colleagues for an interactive, up-to-the-minute briefing with top SEC experts--delivered live to your desktop by CFO.com and the AICPA. To join US for our next SEC...

Finance eye for the IT guy?(editor's note)(Editorial)
September 22, 2003... Our bodies, our wardrobes, and our homes are (TV leads us to believe) badly in need of expert assistance. We are walking disaster areas--clueless in the kitchen, oblivious to the most basic precepts of color and design, apparently unable to...

Renewed ASPirations.(readers write)(Letter to the Editor)
September 22, 2003... I was pleased to read "Down but Not Out" by John Verity (Bookmark, Summer). The second-wave ASP has arrived and with a more pragmatic flavor; it is actually proving to be one of the most durable markets to have emerged from the dot-com...

PCs: terrible things to waste?(readers write)
September 22, 2003... Regarding "Out with the Old, Somehow" (Summer), I would like to share an idea about how to dispose of old computer equipment. I have been on the board of directors at the Boys & Girls Club in Paterson, New Jersey, for over 10 years. We actually...

Offshoring goes on & on.(Browser: news, trends, and research that drive IT strategy)
September 22, 2003... A recent study of IT outsourcing found that 42 percent of all engagements have an "offshoring" component, meaning that work is done in other countries where labor is generally cheaper. The study, a joint effort by IT research firm IDC and TPI,...

CFO as SOX coach.(technology and complying with the Sarbanes-Oxley Act of 2002 )
September 22, 2003... Despite survey after survey (including our own, on page 34) suggesting that the Sarbanes-Oxley Act of 2002 will not touch off an IT spending spree, software and hardware companies continue to insist that technology is a big part of the answer....

A public servant goes private.(Browser: news, trends, and research that drive IT strategy)(Brief Article)
September 22, 2003... Mark Forman, we hardly knew ye. Hired as associate director for IT and electronic government at the Office of Management and Budget in June 2001, Forman was, essentially, the federal government's CIO, with control of a $50 billion-plus IT...

Attention shoppers.(Browser: news, trends, and research that drive IT strategy)(Brief Article)
September 22, 2003... The fact that companies are spending less on IT these days has touched off a growth industry in shopping advice. PricewaterhouseCoopers, for one, has established a new IT Business Risk Management service that aims to help companies determine...

Phase up to reality.(Management)(Brief Article)
September 22, 2003... Most companies want their IT departments to add more value and run more efficiently, and many acknowledge that "IT portfolio management" is a valuable way to achieve those goals, yet few are actively implementing ITPM, In an effort to...

What's in store for data.(Browser: news, trends, and research that drive IT strategy)(Brief Article)
September 22, 2003... E-commerce may no longer be synonymous with dizzying initial public offerings, but it lurches ahead nonetheless. While far from sexy, the issue of data synchronization is the subject of much discussion these days between supply-chain partners,...

Harnessing bright ideas.(Intellectual Property)(intellectual asset management)(Brief Article)
September 22, 2003... Citing a Brookings Institute study that found an enormous shift in a typical company's value from tangible to intangible assets (from 20 percent in 1978 to 70 percent by 1998), Deloitte & Touche is stressing the very tangible benefits of...

Follow the money: even in tough times, companies often fail to track corporate spending. New software may help.(bookmark)(enterprise spend management )
September 22, 2003... The very idea of spend management" should appeal to any finance executive--particularly at a time when many companies face flat revenues. For many, though, the term is an oxymoron, as corporate spending has been anything but manageable. ...

Behind the music: MTV's explosive growth prompts a substantial financial reengineering effort, one that even the most buttoned-down companies can learn from.
September 22, 2003... MTV WAS BUILT ON COOL BUT NOW IT'S FEELING the heat. What was once a humble cable station known for airing music videos in endless rotation is now a programming powerhouse and media juggernaut. Fueled in part by a string of acquisitions,...

Hillenbrand: new life, and a new IT strategy.
September 22, 2003... Redesign processes first, automate second: it's hardly a new message. But while MTV Networks and many other companies are still working to get it right, Hillenbrand Industries Inc. seems to have figured it out. Publicly traded Hillenbrand...

IT directions 2.0.(finance executive survey on information technology)
September 22, 2003... OUR SECOND ANNUAL SURVEY OF CFOs AND SENIOR finance executives finds a surprising degree of optimism about technology, with companies not only prepared to spend more but also continuing to believe in IT as a source of strategic advantage. Given...

Does Dell stack up? The company that triumphed by selling "good enough" technology wants to challenge IBM and Hewlett-Packard. Is it good enough?(Company Profile)
September 22, 2003... When Michael Dell, chairman and CEO of Dell Inc., made the startling pronouncement last year that the Round Rock, Texas-based technology giant will double its revenues to $60 billion during the next several years, he sent a clear signal that...

Spreadsheets forever: on the eve of its silver anniversary, the electronic spreadsheet remains golden. Co-creator Dan Bricklin explains why.(Interview)
September 22, 2003... THIS MONTH THE SPREADSHEET TURNS 25.4. OR 23.9. OR 241 THAT'S THE beauty of the spreadsheet: change your assumptions and the numbers that derive from them change as well. So whether you're dating the spreadsheet's creation from its initial...

An easier call to make: IP telephony companies ask Corporate America the inevitable question: can you hear me now?(telecom)
September 22, 2003... About four years ago, Dave Thompson was looking for ways to cut his then-employer's telecom bills. There was some buzz around a new technology called Voice over Internet Protocol, or VoIP, a method of using the Internet, private data networks,...

Your replacement or mine? For desktop computers, something newish this way comes.(IT assets)(tablets or thin-client computers)
September 22, 2003... Although it seems long ago, there was a time when companies routinely replaced their old personal computers every three years and sometimes sooner. Now, with money tight and PCs powerful enough to handle most office tasks, companies are hanging...

Technology throws another curve: the camera may not lie, but it doesn't substitute for savvy management.(take-away)(Questec umpire evaluation )
September 22, 2003... "They've got physical numbers on a piece of paper. It's about control, manipulation, and coercion." Can you guess the speaker, or the context of that remark? Here are some hints: it involves shredded documents, a whistle-blower; and (potential)...